[Recorded by Electronic Apparatus]
Monday, November 4, 1996
.1115 
[Translation]
The Chairman: We are in Montreal with the Finance Committee of the House of Commons. I would like to introduce Michael Hamelin and Harold Chorney of Alliance Quebec, Dr. Jack Diamond of the Montreal Neurological Institute, Col. J.R. Gilbert Saint-Louis of the Conference of Defence Associations, and Guy Lafleur of the Association québécoise des organismes de coopération internationale. Do you play hockey, Mr. Lafleur?
Mr. Guy Lafleur (Director, Association québécoise des organismes de coopération internationale): Sometimes.
The Chairman: Good! There is also Ken Whittingham of Development and Peace, Gordon Edwards of the Canadian Coalition for Nuclear Responsibility, and Nancy Worsfold of the Canadian Council for Refugees.
Thank you very much for being with us. We are going to begin with Alliance Quebec.
[English]
Mr. Michael Hamelin (President, Alliance Quebec): Thank you very much, Mr. Chairman, for the opportunity to address the Standing Committee on Finance at its session here in Montreal.
[Translation]
My name is Michael Hamelin and I am the President of Alliance Quebec. Harold Chorney has joined me this morning. Mr. Chorney is a member of the board of directors of Alliance Quebec and a professor at Concordia University here in Montreal.
[English]
Our approach here is twofold. On the one hand, we want to face some of the fundamental concerns of our communities of English-speaking Quebeckers, some 800,000 covering the province of Quebec. We want to do so in terms that have relevance to your deliberation.
Moreover, we want to suggest there are some new ways to view the financial and economic situation in Quebec. We think there are some initiatives that should be considered for direct and indirect government action in the face of serious economic conditions found in Montreal and in Quebec in general.
Alliance Quebec is here today in part because of our concern that the economic planning of government services may give ground on some of the hard-won victories, i.e., the issues of linguistic duality so important to English-speaking Quebeckers and to francophones living in the other provinces and territories.
Two examples will suffice to signal our well-founded concerns. First, will changes proposed to the jurisdiction over manpower training, now jointly held by the provinces and Ottawa, be based on spending considerations? Similar changes are being considered in other federal departments. Secondly, changes that are proposed to the very heart of the Canadian Broadcasting Corporation and its mandate, based on funding - these changes would threaten to compromise the delivery of services to rural and minority language communities.
English-speaking Quebeckers have justifiable concerns about the provision of manpower services, information and training to our official language minority communities throughout the province. The notion of devolution of power in this area might be the right solution. Alliance Quebec is open to that. Ensuring that minority language protection could end devolution, however, is considered absolutely essential.
In a separate and related matter, the whole concept of ensuring that French second-language training is considered a job skill in existing federal manpower programs and in any programs in the future is quite essential for the community as well.
It goes without saying that in order to maintain a strong and viable English community, that community and its components require the necessary tools to be able to work in what is essentially a majority francophone community here in the province of Quebec. Given the existing commitments that are there, which are fairly minimal at the present, we would strongly suggest that the notion of French second-language training as a job skill be considered immediately in any manpower training program.
Our second area of concern, of course, is the Canadian Broadcasting Corporation. As far as the CBC is concerned, it is incumbent on the government to ensure that a significant effort is made by public agencies to give life to the repeated references within our Constitution, our laws, and to the linguistic duality of the country. CBC plays an important role, sometimes an indispensable part, in Quebec's English-speaking communities.
There is an urgency with which we view any changes in the mandate of the CBC that allows the network to reduce, restrict, abandon, or even consolidate services in English and French across Canada. Yet the changes that are being reviewed include just such a shrinking of the linguistic minority commitment from the public broadcaster.
There is only one reason for the consideration of such changes: it is the loss of funding assurances that have been the backbone of this service for over 60 years as Canada's public broadcaster.
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We strongly urge the government and its senior financial officers to reconsider the CBC budget issue and to restore the assured and required funding that will allow for 60 years of pride in public broadcasting in Canada. Without it, the minority official language communities in Canada are harmed irreparably.
Again, on manpower, in recent months Alliance Quebec has stated its position that the Province of Quebec has our support to assume all responsibility for manpower training. However - and this is essential - that support is contingent on having the detailed specific legal assurance that current federal protection for minority language manpower services will be maintained by the province.
We are waiting for a clear answer on these questions. What is the current state of negotiations on manpower? Will any devolution of manpower jurisdiction provide for the comprehensive and clear transfer of obligations to the provinces under the Official Languages Act?
The obligation to enhance the vitality and development of minority language communities must remain. Similarly, Quebec and any other province must ensure that the equal status of both official languages be maintained in all spheres of activities.
[Translation]
I would now invite Professor Chorney to communicate to you some proposed items that fall within the jurisdiction of the Canadian government.
Mr. Harold Chorney (Board member, Alliance Quebec): My initial remark will be guided by the comment made by Mr. Martin in the document entitled in English The Economic and Fiscal Update, at page 70. He asked two questions to which I would like to respond.
[English]
First of all, the finance committee is supposed to consult with Canadians and advise on the update of economic assumptions, particularly with respect to interest rates and nominal income. Are these two variables, these projections, correct?
Secondly, what measure of the debt and the deficit ought the government to use in its discussion and presentation of these issues? I'll start with the latter first.
There's an excellent section in this statement, annex number two, on alternative measures. I urge everyone to read it.
The Chairman: We have not only read it, we have memorized it.
Mr. Chorney: I want to urge the other people to read it.
[Translation]
The Chairman: In both official languages.
Mr. Chorney: It's excellent, and I recommend that all participants read it.
[English]
It's a discussion of the different measures of the debt and the deficit. It makes the point that many journalists have a great deal of difficulty comprehending, but we as participants in the public policy process have to understand. In particular, they discuss the notion of measuring the debt and the deficit by the measure of the national accounts as opposed to the public accounts.
They actually give a table that shows that if you do this measurement on the national accounts basis, the total financial requirements for the government, which determines the national accounts, the debt to the GDP is not 75.5% if we look at it on the public accounts, or 74% if we look at it on the basis of net debt in the public accounts, but 55.3%. That is internationally comparable. Instead of the headline figures that the journalists and some politicians love to grab hold of, this is the more accurate measure.
I would urge the government to continue the good work it has begun by including this in all of its future presentations and by educating the journalists about the importance of it. Then we can have a more balanced debate about the debt-to-GDP ratio. I was very delighted to see that in the document, and I wanted to begin with a positive suggestion.
Secondly, in the document there is a general point of view put forward on low interest rates. Again, I congratulate the government for having achieved them, for having persuaded the Bank of Canada to cooperate with the money markets and bring the interest rates down. This is an excellent achievement and we want to preserve it. I had some quarrels in the past about how to go about doing that, but I'll leave those aside for the moment.
I'm very glad we have the low interest rates. It's an excellent contribution to economic recovery. When and if the Federal Reserve in the United States decides to raise the interest rates, we should put as much jaw-boning pressure on our own central bank not to follow as long as the Canadian dollar remains as strong as it is - and it appears to be rising. We should resist the temptation to have a knee-jerk response to a rise in the interest rates in the United States and preserve as long as possible the low interest rate climate that is now developing here in Canada.
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So if there's an error in the document, it's from my point of view and perhaps not from the alliance's. Sometimes when I speak these are my personal observations and I have to persuade my colleagues of them, but I don't always.
If there's an error in the document, it's underestimating the impact of the public sector cutbacks here in Quebec and across the country in giving the sense of pessimism to people about the future of the economy. Here in Quebec, of course, when there's pessimism in the English community and in the general community as a whole, there's political consequences for it in terms of national unity.
I would urge the government, and I'm sure they're aware of this, to pay as much attention as possible to this. They should argue with the people from Finance or from the Bank of Canada when they present a very tough low inflation scenario to you and say that this will deliver the goods. Ask them whether they have calculated the impact on our national unity for this.
I conclude by saying we need desperately not to toss aside infrastructure as a complementary idea to all of the things that are being done in terms of low interest rates. I would urge those people in the government who are in favour of an infrastructure program - and my gossip tells me it may even be the Prime Minister - to in fact see that a new infrastructure program is added to the mix of low interest rate options in terms of public policy the government is considering.
The Department of Finance and the bank, you see, operate with the NAIRU rate, the non-accelerating inflation rate of unemployment. They think it's 9%. This is far too high a rate of unemployment, in my opinion. We should target initially 7% as our objective and gradually work ourselves down to that.
In order to do this, we need an extra stimulus through a new infrastructure program. You could have a Montreal-Quebec component. I call it the relancement de l'économie de Montréal. It is a bond-driven finance infrastructure program targeted here in Quebec and in Montreal to dramatically lower the rate of unemployment.
So I would like to offer these suggestions.
[Translation]
The Chairman: Thank you very much. Mr. Lafleur, please.
Mr. Lafleur: I thank the Finance Committee for its invitation.
The Association québécoise des organismes de coopération internationale, which I am representing here, is a coalition of forty or so organizations involved in cooperation in development through sending funds or volunteer cooperants to the countries of Latin America, Africa and Asia. Among our members are such organizations as OXFAM-Québec, Jeunesse Canada-Monde [Canada World Youth], Cardinal Léger and his Endeavours, and Development and Peace.
I would like to discuss with you for a few minutes the official development assistance budget, one of the rare resources devoted by our society to the building of a world in which, as the UN puts it, security will be based on development and no longer on weapons. These concerns may appear remote when we consider the issues of employment and the issues of poverty that are present in our society today, but in a time of globalization we have to realize that what is happening in the neighbouring nations is also happening at home.
To borrow a term from a campaign that was conducted in the armed forces some time ago, I would say that ``if life interests you'', or ``if humanity interests you'', you should not forget that80 per cent of humanity now lives in what are called the poor countries and the developing countries. That's right, 80 per cent.
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Furthermore, 95 per cent of the new births on our planet will be produced in that part of the world. So if we want to see further than the end of our nose, we have to understand that, in a word without borders, the border between domestic problems and international problems is going to continue to shrink.
Do we really think that our societies will again become prosperous and fully employed in a world in which more than 50 per cent of the people are living in poverty and underemployment? Do we really think that our societies will live in peace, stability and security on a planet in which underdevelopment threatens to generate more and more Somalias, Rwandas, Zaïres and cases such as Haiti?
The globalization of the economy is proceeding apace, but as Mr. Pettigrew himself said more than once when he was Minister of International Cooperation, this globalization of the economy entails a procession of conflicts and exclusions, especially in the Third World.
Private investment, according to the statistics we now have, will pour into only a few of the countries in the Third World, perhaps a dozen out of more than one hundred. Market forces cannot by themselves satisfy the fundamental needs in food, education, health care, family planning, hygiene and cultural life, that are preconditions to economic development.
Do we not see, therefore, that the principle of cooperation is as necessary to the functioning of our planet as the principle of competitiveness of which there is so much talk at present?
The globalization of social justice, of sustainable human development for everyone, is lagging behind. In all honesty, we are a long way from devoting as many resources to it as to the globalization of the economy. The official development assistance budget rightly constitutes one of the rare resources devoted by our society to the international community, to the necessary cooperation between the peoples and the improved functioning of humanity.
Canada made solemn undertakings in favour of sustainable development in Rio, in 1992, and at the World Conference on Social Development in Copenhagen, in 1995. Yet what has it done in recent years? It will have reduced the official development assistance budget by nearly 50 per cent between 1991 and 1998.
Notwithstanding its relatively modest weight, the development assistance budget has had to bear much more than its share of the budget cutbacks in recent years. Today it represents only1.6 per cent of government expenditures, compared with more than 2 per cent in 1991.
Where are the peace dividends in a context such as that, when we were saying in 1990 that the end of the cold war would enable us finally to devote more significant resources to development assistance? During that time, in all fairness, we should point out that military expenditures were reduced by only 30 per cent, as opposed to 45 per cent for development assistance.
Today there is even talk about the Armed Forces developing humanitarian activities and how, to do this, they are even going to get money from CIDA. In our opinion, this is putting things upside down! Yet the overseas expertise of the NGOs in development and humanitarian intervention is recognized internationally, and it is much less expensive than intervention involving the Armed Forces.
How is this logic to be understood at a time when the United Nations is stressing that from now on security will be based on development, at a time when military expenditures in the world are declining substantially?
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When the government reduces its cooperation assistance budgets so drastically, in its own way it ``educates'' the Canadian people negatively. There is not only the budget cutting that affects our society; there is also the message that this cutting sends.
The message that is sent is that in effect our country no longer has the means to show its compassion or to be just. We also send the contradictory message to the poor nations of a wealthy country which, while ranking first under the United Nations program, in human development, reduces its generosity and its capacity to assume its share of the planet's problems.
Such messages, in our opinion, are unacceptable from the standpoint of the values of social and international solidarity that Canadian society and Canada's international relations are based on.
The Chairman: Mr. Lafleur, could you share with us your recommendations? I will then give you an opportunity to present your arguments. Thank you.
Mr. Lafleur: We suggest therefore that Canada at least put an end to the cutbacks imposed on the official development assistance envelope and stop the nosedive this funding has taken in recent years.
On the other hand, we suggest that resources be devoted to fundamental human needs.
Lastly, we think the government would benefit from examining, in terms of revenues for the coming years, such approaches as the Tobin tax on international financial transactions, a proposal that has been made in international forums for several years.
That is the message of solidarity and hope that the next federal budget should send to all Canadians and to the other nations of the international community. Thank you.
The Chairman: Thank you, Mr. Lafleur. Nancy Worsfold.
Ms Nancy Worsfold (Executive Director, Canadian Council for Refugees): Mr. Chairman, ladies and gentlemen, thank you for allowing me to address the Finance Committee once again.
[English]
The Canadian Council for Refugees is a coalition of 145 groups from across Canada who are concerned about refugee rights and about the integration of refugees and immigrants.
In the budget announcement of February 1995, the government imposed a new tax which violates refugee rights and which negatively affects the integration of refugees and immigrants. That tax, known as either the right of landing fee or the head tax, is a fee of $975 levied on all adults granted landing in Canada, payable upon application. This fee is on top of non-refundable processing fees, which generally start at $500 per adult for refugees in family class and are much higher for business applications.
Many groups have joined the call for the elimination of this unfair, counter-productive head tax. The latest group to join the chorus of opposition is the Liberal Party of Canada. Not two weeks ago, the Liberal Party adopted the following resolution:
- BE IT RESOLVED that the Liberal Party of Canada urges the federal government to
re-examine the entry fee of $975, with a view to its reduction or abolishment, as it creates an
impediment for those with large families wishing to migrate to Canada, and places a heavy
burden on those who are seeking to integrate themselves into the Canadian economy;
Furthermore, we agree with the Liberal Party that the head tax impedes integration. The head tax violates our international commitments. The head tax violates the spirit, if not the letter, of the Geneva Convention Relating to the Status of Refugees, which Canada has signed.
Article 34 states that signatories:
- shall as far as possible facilitate the assimilation and naturalization of refugees. They shall in
particular make every effort to expedite naturalization proceedings and to reduce as far as
possible the charges and costs of such proceedings.
The head tax is discriminatory. All adult immigrants and refugees are required to pay the same amount, $975 Canadian, regardless of their life situation and regardless of their country of origin. This creates a very unequal burden of taxation.
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It is not just an obvious discrimination that the wealthy investor must pay the same as the penniless widow. It is a profound discrimination on the basis of national origin because of the relative value of the Canadian dollar in different countries. The accountant from Italy must pay $975 Canadian - at most, a few weeks pay - but the accountant from India, faced with the fee of $975, is looking at several months', if not a year's, pay. The head tax is a far greater burden on anyone who is less privileged economically, especially women. It is an unthinkable fee for many refugees - those who have lost their homes and homeland and have been forced to flee.
You are, of course, aware that opportunities for economic advancement in refugee camps are extremely limited. The head tax is distasteful. Canadians should be profoundly ashamed that their government charges the head tax to refugees.
Our government is involved in a protection shakedown. A refugee is someone who has fled persecution, war, or gross violations of human rights. By charging the head tax, you are saying that you will protect them and they can stay, but they have to pay $975.
Furthermore, the head tax is truly taxation without representation. Any other group in Canada faced with such an unfair tax would have protested loudly and vigorously, but the head tax is sneaky. Most of those who are going to have to pay it are not in the country. They cannot protest. The head tax delays integration.
Let me tell you a story to help you understand what the head tax means to an individual life. Omar was a liberal journalist in Algeria. His newspaper was targeted by extremists. Knowing that it was just a matter of time before he suffered the same horrendous fate as his colleagues, Omar decided to flee.
But the Algerian government doesn't like liberals either, so he could not get an exit visa. Hiding out for weeks, he spent all of his money selling, furniture and heirlooms, to pay for false documents to allow him to flee. When he arrived in Montreal he made a refugee claim, and because he had spent everything to get out, he applied for welfare. He had brought with him documents that backed up his story and that he hoped would eventually help him start again as a journalist.
Because his case was well documented, he was accepted under the expedited process in three and a half months. Now traumatized but relieved, he must come up with $1,475 of his own for his landing application, plus another $1,575 for his wife and child, for a total of $3,050. If he doesn't land, he can't get his professional equivalency to go on with work. If he doesn't land, he cannot bring his wife and child. If he doesn't land, he will go on with temporary work permits, which most employers distrust.
The Chairman: Could I ask you to wind up? I think all of our guests were asked in the opening remarks if they could limit them to three minutes.
Ms Worsfold: I was asked to prepare five. That is what I was told on the telephone.
The Chairman: Okay.
Ms Worsfold: I've got only a couple more paragraphs.
The Chairman: Okay.
Ms Worsfold: You will allow me...?
The Chairman: I'll give you my personal word as a politician. Every individual will have as much time as they want to present their case, but I just wanted the opening round to -
Ms Worsfold: I'll finish really fast. I promise. I'll talk really fast.
The Chairman: No, no.
Ms Worsfold: But it matters. You're talking about -
The Chairman: I don't want you to talk too quickly, because la traduction simultanée est très importante.
Ms Worsfold: Okay.
He now must take his assistance cheque that he gets from provincial welfare to pay off federal fees. It just doesn't make sense. Should he stop eating? Should he never take the bus and stop looking for a job? What would you do?
If you think his problems are solved by the loan program, think again. The loan doesn't include a $500 processing fee - $1,000 for him and his wife. He would still have to pay back the loan out of his subsistence-level welfare. But in this case, Omar was turned down for the loan because he was not yet working. This is not helping Omar settle in and start a new life in Canada.
There have been suggestions that the head tax could be made payable at the point of landing instead of application, so it would be when you get your landed status. If this fee is maintained - and of course we urge that it be completely abolished - it would at least make sense for it to be levied at the point of landing. The Canadian Council for Refugees has already urged the government to delay payment of the $500 processing fee to the point of landing.
The head tax is fundamentally unjust. However, an altering of the time of payment will not make it just. Refugees will still start their lives in Canada with debts, integration will be delayed, people will continue to go hungry so that they can pay their head tax out of welfare cheques. Potential immigrants to Canada will continue to be discriminated against on the basis of their country of origin. We call on the government to follow the advice of the Liberal Party of Canada and the Bloc Québécois and abolish the head tax. Thank you.
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The Chairman: I think we get the message.
Ms Worsfold: I'll come back next year and say the same thing if you don't.
The Chairman: Thank you.
[Translation]
Mr. Saint-Louis and Col. Henry.
Col. J.R. Gilbert Saint-Louis (Chairman, Conference of Defence Associations):Mr. Chairman, ladies and gentlemen members of the Committee, I have the impression of being a bull in a china shop after listening to some of the previous comments. I am not a bull and I don't think I am in a china shop, but I think it is important that the message I have to convey this morning, as chairman of the Conference of Defence Associations, be clearly understood. I am going to repeat, perhaps, the words of my predecessor. I may even remind you that the message that was conveyed last year does not appear to have been heard.
I am going to try to keep within the three minutes allocated to me. If I forget something,
[English]
I hope that my colleague Sean will pick up and help me in this.
[Translation]
It is indeed a pleasure and privilege for me to represent the members of the Conference of Defence Associations before you today. My aim is to convince you that it would be most unwise and detrimental to Canada's national interest to impose still further cuts to the National Defence budget beyond those that have occurred over the last several years.
I would suggest instead that the time has come to start considering modest increases to defence, starting with the next budget.
In this respect, I will repeat to your committee the message delivered last year by my predecessor, Col. Blakely. I have distributed to you a copy of the major document, entitled Defence and the National Interest. The arguments it presents are still important and valid. I hope that each of you will have an opportunity to read it in full, and I mean in full, and not rely on a résumé prepared by your staff.
This document will provide you, inter alia, with a description of the Conference of Defence Associations, which represents several thousand Canadian women and men across the country. I can tell you now that these Canadians, members of the CAD, were not happy, last year, that the committee and the government ignored our advice and went ahead with further large cuts to defence in the 1996 budget.
My remarks this morning will note that this was not a wise decision, and that it reinforced a number of problems we are encountering as a nation at home and abroad.
Before proceeding to matters of budget detail, it would be useful to examine briefly several background factors. First of all, few would argue that Canadians face a crisis within their defence establishment. Somalia is perhaps the indicator of this problem and the tip of the iceberg that has been forming over a period of several decades. In other words, Somalia was a disaster waiting to happen.
Although one can point to a number of sources of the problem, including insufficient budgets and poorly spent funding, the demilitarization and bureaucratization of the Armed Forces, misguided application of the Charter of Rights, unification of the Canadian Armed Forces or the efforts of peace movements, and so on, we must above all keep in mind that there is one fundamental issue that has caused these factors to coalesce to form the critical mass of this iceberg.
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The unifying factor is the failure of Canadians and their government to understand the way in which the Armed Forces of the nation play a vital role in peace as well as war. The nature of this vital role is the essence of our argument that defence is a major cornerstone of the national interest. That is why we say to you that defence funding is as important to the well-being of Canadians as the funding provided for social programs.
As if lack of understanding of defence were not enough, Canada's policy of directing its major defence effort towards the United Nations missions and classical peacekeeping only adds to the problem.
The Chairman: Are you about to give us your conclusions?
Col. Saint-Louis: No, but I will at least add three more paragraphs, if you will so allow.
The Chairman: I can hardly deny you that.
Col. Saint-Louis: Thank you.
Recent history has shown that traditional peacekeeping is on the wane, and that as a general rule conventional military intervention is being resorted to more often, as in the past. The operations in the Gulf, Somalia and Bosnia were not successful or effective until strong military power was applied. Rwanda in particular led to catastrophic results because we refused to recognize the seriousness of the situation, which required a type of intervention other than the one dictated to us by our blind faith in a peacekeeping operation that our prime minister was determined to pursue.
Canada seems determined to ignore these hard lessons, just as it refuses to commit combat troops and seeks instead to undertake only headquarters and logistics functions at best, and non-military humanitarian support at worst.
The important point is, perhaps, that budget cuts have led us to this alternative by default, since they reduce purely and intrinsically military capabilities to that level.
I can stop at this point and ask my colleague to carry on with other points.
The Chairman: Excuse me. You have almost 50,000 colleagues. Are they supposed to appear before us? I will ask you to be brief.
[English]
Col Saint-Louis: Pardon me?
The Chairman: Colonel Henry, quite briefly, please. Could you be quite brief in this opening round?
Colonel (Ret'd) Sean Henry (Senior Defence Analyst, Conference of Defence Associations): I will be brief.
I think it is necessary to follow up Colonel Saint-Louis' words with a couple of specific examples of what he's talking about with respect to the DND budget.
In this respect, certainly members of CDA were rather upset at what I can only call misleading information - not untrue information but misleading information - that was passed in this committee last year, was in the committee report, and was repeated for a third time in a letter that the Minister of Finance sent to Colonel Saint-Louis in July. This was that DND should not be complaining, because it still gets the largest share of the departmental operational budget.
That's a true statement, but the trouble is that the departmental operational budget in total has been shrunk down to less than 20% of the total federal budget and by far the large part of that reduction was taken out of DND.
In the first place, DND is not a department just like any other department. It's a very special one. The fact, as I've already mentioned, is that the funding is down before you even start.
What is really important in all of this is not to look at departmental funding but to look at the entire federal budget. When you do that, you then see the point that Colonel Saint-Louis is trying to make, that by the time the budget 1996 wind-down is finished in fiscal 1998-99, we're going to see that 5% of the federal budget is spent on defence, down from about 10% a few years ago, and more importantly, that this will represent only 1% of GDP. That 1% of GDP puts us among the very lowest of the nations of the world, and yet we call ourselves a G-7 nation. That is a very important point to note.
.1155
The Special Joint Committee on Canada's Defence Policy from a couple of years ago, after months of study, said that defence spending should not fall below $10.5 billion per annum out to 1999. We are now down from $10.5 billion to $9 billion; that $1.5 billion has been devastating and will continue to be devastating upon the armed forces. There are charts attached to Colonel Saint-Louis' presentation that show this.
One of the most damaging aspects within the reduction of the budget of DND has to do with capital. Capital is mainly oriented towards equipment and is in the process of falling from 23% to 17%. Again, if you look at another chart attached to this presentation, you will find that by the year 2000 it's going to be down to 10%, which is where it was in the mid-1970s when the forces rusted out.
We are still trying to get back from that low point in the mid-1970s, which is mentioned in the presentation. This drains the lifeblood from the forces by creating the inability to provide critical basic equipment, placing the lives of Canadian troops at grave risk. I think I can do no better than repeat what Colonel Saint-Louis said at the beginning, that the time has come to stop cuts to defence. They have been very large, again as you will see from the attachment to this presentation. Stop, and in fact about the year 2000 start looking at some modest increases to put defence back on track.
I couldn't ask for anything better than to pass out copies of this article by Professor Bercuson, a noted political scientist from the University of Calgary, which explains very well what it is Colonel Saint-Louis has said.
The Chairman: I, as the chair, have done a terrible job. We started at 11:10 a.m., it is now almost 11:58 a.m. and we've had four witnesses; so that's taken us 3 minutes times each one, which is 12 minutes. But my watch must be fast, I guess. I apologize.
From the Montreal Neurological Institute, Dr. Jack Diamond, please.
Dr. Jack Diamond (Associate Director, Montreal Neurological Institute): Mr. Chairman and ladies and gentlemen, I am very glad to be here. You'll be pleased to know that I don't have a prepared text. As soon as you wave your hand, I'll stop.
The Chairman: You're wonderful. You're the only person in the room who's that tractable.
Dr. Diamond: Don't push me, of course.
First of all, I am associate director for scientific affairs at the Montreal Neurological Institute, where I foster and manage science. However, I actually do it at McMaster University in Hamilton, and I also represent that.
I know you have had lots of briefs about the funding of basic research. You've had briefs that have pointed this out, and I'll just summarize it by saying that of all the G-7 countries, only one has reduced its budget in the way Canada has, and that's Canada.
In the period from 1990 to 1998, in real dollars we will have reduced our support to basic research by 25%, and we are becoming regarded by the rest of the developed world as an underdeveloped country. There seems to be a perception we can buy everything from somewhere else, somewhere else usually being the United States. It's just like flying a plane; you send your pilots somewhere, they learn to how to fly the plane, and then they come back and they boost our economy by flying our planes.
.1200
Science doesn't work like that, and I thought the most useful thing I could do is not to speak to you about all these figures but to tell you what we mean by the infrastructure of science.
Science is a dynamic, continually growing phenomenon. As Japan has discovered, you can go only so far by taking over other people's advances. Japan is in a staggering state economically, because they've now got to build the science infrastructure they never had, and they're pouring hundreds of billions of dollars into it.
We can't afford to go that way. We've got to have a thriving scientific community here to promote the science we ourselves produce and to understand and use the science that other people produce. You can't import science like that; you must have the community do it.
Let me give you two little examples of what we mean by infrastructure, right down to the trench level. I have two technicians; one of them has been with me for 25 years, the other for 19 years. I have to struggle to get a minimum of three grants from various agencies simply to pay their salaries. Before I can buy a test tube, I have to get something like $80,000 to $90,000. The average MRC grant is much less than that. If I had only a Medical Research Council grant, I wouldn't be able to keep these people.
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These are skilled, highly trained technicians. These people do the work. They help us train the students, the post-docs we have in our labs, the future young scientists of Canada. Right now, where are they going? They're all drifting south of the border. They drift south of the border to get further training and stay there, because they get jobs. We don't have jobs. This is an appalling situation.
The government's telling us to ally ourselves with business. Business can't do this sort of science. Business can't invest in something that doesn't have a perceived end over at least a minimum of three or four years. That's not how business works. You can't blame them; obviously they're not in it for any other reason than to make their businesses economically successful. They wouldn't have supported a Fleming, who accidentally noticed that one of his dishes was killing all the bugs. They wouldn't have supported Crick and Watson, who worked for years to discover what now is the basis of a biotechnology industry. They wouldn't have supported the scientist who worked on quantum mechanics, which now is the basis of the semiconductor industry.
Business doesn't do that sort of thing. This goes on in basic science labs.
I'm a scientist. I can assure you that if you continue to starve us of money, you're starving your country. You're starving it of the industries that it could foster, the infrastructure, the people, the training, the whole educational system, and we will become dependent on some other country. That other country may not only be the United States, it may also be Germany or France or Sweden. It's an appalling state of affairs.
I'll stop there, Mr. Chairman. You can come back to me later.
The Chairman: Thank you very much, Mr. Diamond. You're so kind to the chair.
Mr. Ken Whittingham, please.
[Translation]
Mr. Ken Whittingham (Director, Communications and Research Department, Development and Peace): Good morning, ladies and gentlemen. Thank you for your invitation to me this morning.
[English]
I have four principal points I'd like to make today. As a former copy editor, I've been trying to edit my text while the witnesses have been making their comments. I'll attempt to do it in four minutes flat.
I want to make points concerning the economic situation in Canada and the conditions abroad that have a very direct impact on the lives of all Canadians.
The first point is that the effects of poverty are not limited to the poor, because poverty lies at the heart of so many social ills. It affects large segments of the population, and in that sense the middle class and the wealthy have just as much to gain from the eradication of poverty as do those defined as living below the poverty line.
When preparing budgetary policy, therefore, the federal government must take steps that go beyond simply caring for or helping alleviate the plight of the poor. Government policy must be based on the firm commitment to prevent any further increase in poverty levels. The fact that at least 15% of the Canadian population currently lives in poverty is already unacceptable. As important as it is, government policy must not concentrate, as it sometimes seems to, almost solely on helping business and industry become more competitive in the new global economy.
Government must look creatively towards other avenues of economic recovery, to new strategies that will lead to fuller employment, a broader tax base, and a better standard of living for large numbers of people.
Government must also do what it can to help anti-poverty groups and other grassroots movements carry out their work. Canadian government support for such groups has clearly been dropping steadily. Strategies to improve competitiveness in Canadian business obviously have their place, but there must be more of a balance. Other strategies must be adopted to help breathe new life into the Canadian economy.
Such a goal cannot be achieved overnight, but by attacking the root causes of poverty, significant headway can be made to change society's deeply ingrained notion that the poor are simply a fact of life and that the poor will always be with us.
A similar pattern in federal government thinking can be seen at the international level. Canadian government support for international development no longer seems to be a priority, as we heard a few moments earlier. Our external relations appear to be governed by the same criteria that apply to domestic economic policy; that is, we do whatever it takes to make Canadian business more competitive in the international arena.
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Canada seems to be putting aside the liberal humanitarian values and vision that guided our foreign policy through much of this century and linking our foreign policy very directly to business interests. This may result in short-term benefits, but if a large portion of the world's population is denied the opportunity to participate fully in the world economy, our own citizens will suffer in the long run.
We only have to look at the morning headlines to see what is happening in Africa. The question I put to you is: do we really want to live in a world where our own sons and daughters may be increasingly called upon to go abroad to try to end civil wars and disturbances? The answer obviously is no, but such upheavals are the inevitable result of the literally obscene abuses that are committed daily in the countries of the Third World. We must start asking ourselves today what we can do to prevent them.
My last point can be seen really as a mirror image of my second. Just as popular groups and anti-poverty movements must struggle more and more to eliminate the root causes of poverty here in Canada, so NGOs such as Development and Peace, which I am representing here this morning, also find less and less willingness on the part of the federal government to support the work we do overseas - work designed to give people the tools they need to change their lives, to participate more fully in global economic development.
We and they are looking not for charity or handouts, but for the right to live and work in dignity. By reducing funding to NGOs and by reducing international development funding in general, the Canadian government is condemning future generations of people the world over to lives of extreme hardship.
My four points again, in a nutshell, are that we must work not simply to reduce the effects of poverty but to have as a firm goal the eradication of poverty itself, and we must support grassroots movements working to eliminate the causes of poverty; we must not link foreign policy exclusively to business interest; we must not abandon, as I said, the liberal humanitarian values that seem to lie at the root of our current policy through most of this century; and we must continue to fund international development work and NGOs that are working to give people in the Third World the tools they need to live more productive lives.
The Chairman: Thank you, Mr. Whittingham.
[Translation]
Mr. Laurin, would you like to open the question period, if you please?
Mr. Laurin (Joliette): My first question is directed to the Canadian Council for Refugees.
Many people think the Canadian policy on immigration or refugee screening has become too lenient or too generous. I would like to have your comments on that.
Ms Worsfold: It depends on what you are talking about. If you are talking about the immigration levels announced last week by the federal government -
Mr. Laurin: I am not talking about the number, but about the money that is spent on taking in refugees, the social benefits that are accorded to immigrants. You too seem to be saying that the government should reduce some expenditures attributed to refugees. So it is in that sense that -
Ms Worsfold: In relation to costs?
Mr. Laurin: Yes.
Ms Worsfold: In the first place, this question, I think, reflects the prejudices and misconceptions we have concerning new Canadians. All studies demonstrate that in the course of his life, a person born outside of Canada pays more to the Canadian Treasury than he takes out of it. From the fiscal standpoint, we get more profit from someone born outside of Canada than from someone born in Canada. It is a prejudice that new Canadians are more dependent on social services than others.
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It is true that refugees, in particular, often resort to social assistance at the beginning, but over the whole of their life persons who are not born in Canada are less inclined to use the social services than persons born here. So there is a clear profit for the Treasury.
Those are not arguments that I would use in favour of accepting refugees. To me, if someone must flee in order to save his life, where human rights are being violated, it is a humanitarian issue. If we want to make it a dollars and cents issue, it is a prejudice to think that the new arrivals cost more than people from here.
The people who come from elsewhere bring all kinds of other benefits to Canada, such as the possibility of getting involved in international markets through their contacts and language skills, or whatever. We also find among the new arrivals a much greater tendency to set up small businesses than among Canadians born here.
Mr. Laurin: My second question I would like to direct to Col. Saint-Louis. We of the Bloc Québécois have made many recommendations, and many requests to the government for a reduction in expenditures on the army.
Throughout the questions that have been asked in various committees, particularly in the Public Accounts committee, there has been a realization that the army was suffering from a very great malaise, namely, its mismanagement. There was a recognition that there was a lot of waste in the army.
If, based on the budget cutbacks that have been applied to it, the army had managed more effectively, wouldn't that have compensated for the cuts that were made and enabled it to continue to procure the essential services it needs to fulfil the missions that Canada assigns to it?
Col. Saint-Louis: That's a big question, and I hope to be able to take at least two minutes to try to answer it. I will ask for Sean's assistance on this point.
There are at least two levels. There are the investment expenditures or the capital spending, and there are the current operations expenditures, to which must be added the whole aspect of what may be, how should I put it, the Canadian Armed Forces establishment. How might the level that applies to the Canadian Forces be designated?
I mentioned - and if I didn't mention it, it is in my written submission - that, among the problems, there were no doubt, as in any large organization that has not been challenged over the years, some problems of mismanagement of expenditures.
This can neither explain nor justify the astronomical cuts that have been made for five or even eight years, by which the Armed Forces operational budget has been reduced, particularly if we decide that the existing organizational formula should be changed.
What I mean by that is that we would have to know whether we are heading toward a peacekeeping military structure, that is, soldiers who are not soldiers, or whether we want to develop and train soldiers who are capable of acting as real soldiers, even if it means training them in terms of other, non-military or quasi- military roles, depending on the missions we will want to assign to them.
When we talk about investment expenditures, we are thinking about what an inventory of our present aging equipment discloses. I think the current government is not totally unaware of this. Three years ago they put the axe to the helicopter acquisition, saying that the six billion dollars set aside for that purchase were to be spent elsewhere. But we still don't have those helicopters and the ones we do have, even if they meet current needs, may not meet the future needs of the forces.
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The savings that can be achieved through better management of expenditures are not sufficient to meet the financial needs of genuinely military armed forces. That's the first thing I would say to you; that is the answer I would give you.
Having said that, we recognize that all is not well. The least I can do is to acknowledge this. The newspapers have been having a heyday over it for years. However, it is not enough to note this; it is necessary to find the solution and commit ourselves immediately and firmly to its implementation. There are a whole series of ailments, which I noted, or simply causes of problems on which we have to begin spending some time.
The Chairman: Thank you, Mr. Laurin. Excuse me, but the reply was perhaps a big long and there are a lot of members. I will try to come back to you.
[English]
Mr. Grubel.
Mr. Grubel (Capilano - Howe Sound): I have a quick question for Mr. Chorney. He had a quick suggestion at the end. He mentioned a concept called bond-financed infrastructure spending. Is that correct?
Mr. Chorney: Yes, that's right. I was thinking of that in the context of Quebec and Montreal, first of all, where we have quite a dreadful unemployment situation of 12.5% and very deep pessimism in the economy, in addition to a referendum on secession, which would be an excellent suggestion. I hope the colleagues who were here earlier take that up with their own colleagues. In addition, I think it would be an excellent idea as part of an infrastructure program to try to sell very low interest rate bonds as special recovery bonds for Montreal, bons pour la relance de l'économie montréalaise ou québécoise.
Mr. Grubel: But they are not basically different from the bonds a government issues when it finances a deficit.
Mr. Chorney: I would like these bonds to be guaranteed by the provincial government, which then enables the Bank of Canada to acquire some of them. It enables investors who would like to see the Montreal economy recover in the interests of Canadian unity and in the interests of Canada.
Mr. Grubel: But when the international investors look at it, it will be exactly the same as, if not worse than, the bond issued in response to an ordinary deficit. Yes or no?
Mr. Chorney: Would it be exactly the same or worse?
Mr. Grubel: Thank you very much. I would like to go on to another question, please.
Mr. Chorney: I'm not sure what you've asked.
Mr. Grubel: The interesting proposition I heard here is the suggestion that there is a magic bullet, and the magic bullet in this case is to finance job creation without adding to the debt. You call it something different and I just wanted to know whether in fact there was something else. There obviously isn't.
I'd like to talk to Ms Worsfold, who's very committed to a cause. There are lot of people who are committed as you are. I'm personally committed to a democracy, and I want to tell you the problem I face.
I represent my constituents. If you wish, I can show you the log of telephone calls, letters, and personal interventions I get. Do you know what topic is at the top?
Ms Worsfold: Yes.
Mr. Grubel: What is it?
Ms Worsfold: It's immigration.
Mr. Grubel: Immigration. Now, which way do you think the arguments go? The way you would like them to?
Ms Worsfold: Mr. Grubel, the argument I made was with regard to the head tax.
Mr. Grubel: You spoke at length. I heard what you said. Which way do you think they're going? Do you think we should take more refugees, that we should get rid of the landing fee? Should we have foreigners have a vote here as to whether they should be taxed or not before they come? Which way do you think they go?
Let me tell you. It's a rhetorical question, obviously.
Ms Worsfold: Obviously.
Mr. Grubel: Most of the points are being made. We are running a huge deficit. We have to stop all the expenditures that come up with immigration.
You talked about a journalist. What is the rate of unemployment among journalists? They say their son wants to become a journalist, and here we have somebody coming from abroad. What do I say to these people? I know what you answered in response to -
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Madame Finestone, what did you say, please?
Mrs. Finestone (Mount Royal): Nothing. I'll say it when it's my turn. Excuse me for interrupting.
Mr. Grubel: I've made some of these studies on the economic impact of immigration myself. The studies you read are by my former students. It is also clear that when they first arrive, there are large expenses for the government. Only later do some of them repay.
The studies you are referring to are based on a time when immigrants were selected by the Government of Canada on the basis that they would be young, educated and highly productive. With over 50% of the immigrants now coming into this country - not selected but self-selected, and family unification - those numbers have turned around. I cannot in all due conscience tell my constituents who are complaining about this that they are all wrong, that they they are not competing for jobs and are paying more into tax revenue than they are collecting.
How can we solve this dilemma? Can you somehow help me so that I don't face this dilemma? On the one hand, they are asking me to vote in favour of the landing fee, to vote in favour of stricter rules for immigrants, refugees and things of this sort.... How can we get out of this dilemma?
I understand the passion and the troubles you are talking about. Why should Canadians not have the right to pass laws and say that people who are not Canadians who wish to come in this country have to meet certain conditions, and one of them is to pay a fee?
Thank you.
Ms Worsfold: I've been asked a series of questions. I'll try to answer as many as possible.
You mentioned that the numbers have turned around with regard to the return on immigration. The study Diminishing Returns indicates that the percentage return on a non-Canadian over a Canadian is slightly less now, but it remains that a non-Canadian is more of a net gain to the public treasury than a Canadian-born, although the percentage is slightly less than it was in the past.
I don't accept your arguments on self-selection versus government selection. Family class are people who are chosen by Canadians, and I don't think that makes them self-selected at all. With regards to -
Mr. Grubel: What input do you have when somebody comes from -
Ms Worsfold: Canadians sign sponsorship undertakings saying they will support this individual for ten years. Although I would agree that there have been problems with regard to the enforcement of those undertakings, the reality is that somebody in Canada has a commitment to that person. The fact that it is not the government but a Canadian citizen selecting that person, I don't quarrel with. I still say they are selected by Canada -
Mr. Grubel: When somebody from Germany has come here because he was young, has a skill highly in demand in Canada, comes here even before he's a citizen and says he cannot live without his parents and grandparents and then he brings them in here - how can I tell my constituents the Government of Canada, the people of Canada, had a voice in the selection of those parents and grandparents?
Ms Worsfold: Mr. Grubel, I will send you a copy of our Facing Facts: Myths and Misconceptions About Refugees and Immigrants in Canada -
Mr. Grubel: Just explain that to me.
Ms Worsfold: Let me finish, please. I will send you a copy of the publication you need to specifically explain some of this.
Mr. Grubel: I'd like to have it on the public record how the Canadian people had a say in the selection of that individual.
Ms Worsfold: Because the Canadian public has voted for governments that have created an immigration policy that values family.
Mr. Grubel: I'm sorry, you're not answering the question. You have told me I am wrong. In my example a young German has come here. He decides to bring his parents and other relatives here. Earlier you said the people of Canada, individuals sponsoring that individual, had a say in whether or not these parents should come in here. How can I explain that to my constituents?
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Ms Worsfold: The individual is in Canada. He has met the income requirements, he fulfils the Canadian value of family, and he is taking responsibility for those parents.
Mr. Grubel: Thank you, Ms Worsfold. I'm getting signals that I'm going on too long.
Thank you, Mr. Chairman.
The Chairman: Thank you, Mr. Grubel.
Mrs. Finestone, please.
Mrs. Finestone: Thank you, Mr. Chairman.
I just want to underscore the fact that I don't agree with one single observation made byMr. Grubel of the Reform Party. I support 100% the observations made by Canadians that ours is a country of generosity, a country built by immigrants. And as my colleague Mr. Discepola just said to me, except for the aboriginals, who were here when we got here, we're all immigrants.
I think the development of Canadian public policy has shown a great spirit of humanity, of welcomeness and an openness to diversity. That's the strength of this country. It's the hidden asset of this country. It is the reason this country can grow internationally. It's because we have all those people from the four corners of the earth living here in peace and harmony, even when we have little family squabbles.
Thank you, Mr. Grubel. I don't like what you stand for in those observations.
Mr. Grubel: I don't like what you stand for either. So there!
Mrs. Finestone: The next issue I would like to raise -
Mr. Chairman, I really want to talk to the military for a moment, but I have to support the observations made by Alliance Quebec. You know the situation here in Quebec is difficult, and some of us feel we live on the edge of an abyss in a country that we love, which includes Quebec within Canada.
This morning Ghislain Dufour and others alluded to the fact that political instability has created a lot of discomfort. But in addition to political instability and the changes we have to make is the devolution of various areas of work. Within that devolution it becomes vital - and I'm saying this as a guest to this committee, for which I thank you - that you must ensure that whatever is transferred includes language protection for minorities.
[Translation]
Whether it is English-language minorities here, in Quebec, or French-language minorities outside of Quebec, it is absolutely necessary that any transfer or devolution include protection for the two official languages of Canada. Furthermore, I insist as well that in manpower training, people do their learning in a language they understand and that the French language be another tool that they learn to handle,
[English]
so that they receive their new training in the language they understand, and secondly, they learn the language in which they're going to work as another language, as another tool.
With respect to the sense of belonging, the sense of participation - Linus's little blue blanket, if you want to call it that - communities of English-speaking.... If you go through the Gaspé, the Eastern Townships or the Hull-Outaouais area, anglophones are everywhere, and we need the communication link that is part of the Broadcasting Act, and the CBC board of directors has no right -
[Translation]
In the CBC it is absolutely necessary that we have stringers, as they are called in English, who report what is happening in all the English-language communities, throughout Quebec. They should improve the reporting for French-language persons outside of Quebec, not only in Regina but throughout the rest of French Canada. It is appalling, and it is not intelligent.
[English]
The last thing outside of the stringers is newspapers. Community newspapers, as everyone should know, and certainly politicians know, stay in the corner of your kitchen table or perhaps on the bathroom shelf. People read the community newspaper from cover to cover.
It is vital that two things happen. One, minority language communities and minority newspapers, whether religious or commercial or otherwise, must have the kind of government support that the postal subsidy gave them before. They must be circulated and supported, and government ads in both language newspapers must be there so you can extend the information to the minority groups within your country.
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That said, and as I'm sure you can tell by my remarks I'm at all upset by this whole thing, it is vital. Michael Hamelin and Alliance Quebec, someone else can ask you if they want elaboration on it. I live with it as you do. The linguistic duality is vital.
I would support what you've said, Nancy. I don't agree with the head tax, and my party knows that. In a democracy one has to support, and I believe one supports our government.... I think we've done everything else right, but I don't like what we do on the head tax. I know they don't like it called a head tax; they want it called a landing fee. But I call it a head tax.
[Translation]
Mr. Lafleur and Mr. Whittingham, I am sure that you are right in a certain sense: our world is very small.
[English]
The global village is there, and we have to do both sides of the global village. In protecting the global village we have to protect ourselves and our neighbours. If we don't have a creative intellectual approach, Mr. Diamond, then we are never going to have independent research that will lead, as you pointed out, to serendipity. Serendipity through basic and fundamental research and development is key. We can't link everything in this world to the marketplace.
That said, let me go to the main focus of my question this morning.
The Chairman: I think you're just about out of time.
Mrs. Finestone: My last observation goes as a question to Mr. Henry and Mr. Saint-Louis. I would like to understand the relationship between what I call the militia, who are selling you the veteran's November 11 poppy, the role they play in our ridings, the importance of that volunteer force that is called upon once or twice a year to get training, and its relationship to your document, which has a lot of money and figures and graphs about buying equipment. You must have people you can call in to use that equipment if you need to call up your armed forces. Peace-making and peace-keeping are different from actual wars. I want you to deal with that.
The Chairman: Thank you. You have about one minute.
[Translation]
One minute, please.
Col. Saint-Louis: I might refer you to the report of the Special Commission on the Restructuring of the Reserves, which was chaired by the former Chief Justice Dickson, for a somewhat fuller reply than the one I will give you in one minute. I have 30 seconds left in which to tell you that, yes, the militia, which is the army reserve, or the air and naval reserves are the military presence in the regions and can help disseminate the Canadian entity throughout the regions to some degree.
One of the problems we are now experiencing in the militias is the problem of the regular army's control over the reserves. We are, or course, going to tackle that long-term problem and be able to make some proposals, perhaps within one or two years. There is a complete presence of more than 180 reserve units throughout the country. I am talking only about the reserves at this point; I am not talking about the rangers and cadet corps, which cover young people between the ages of 12 and 17. You have over 2,000 or 2,500 cadet corps in the various forces. This is, in our view, a very important consideration.
The reserve must be trained to the same level as the regular forces and be prepared to go and fight or serve in the missions assigned to it by the government.
The Chairman: Thank you very much, Ms Finestone. Mr. Discepola.
[English]
Mr. Discepola (Vaudreuil): I have no questions.
The Chairman: Mr. St. Denis.
Mr. St. Denis (Algoma): Thank you, Mr. Chairman.
Thank you to all of you for being here. I would like ask a question of Mr. Lafleur.
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I was a CUSO cooperant in Jamaica in the early 1970s, and I can appreciate to some extent the very important work that NGOs do abroad to advance the cause of world development.
I'm sure that as the Minister of Finance and others contemplated how to deal with the federal deficit, it was with great difficulty that the subject of what to do with foreign aid was addressed. I for one hope that we have seen the end of cuts and hope that in the future we can get back to our targeted percentage of GDP as far as foreign aid is concerned.
What I would like to ask you, Monsieur Lafleur, is this. It's my perception that progress with respect to so-called Third World development and the eradication of poverty has not been all we would hope it to be. The foreign aid budgets of Canada and other industrialized nations aside, we have to be more effective with development dollars. In the past we've seen big macro-projects such as dams. I'm wondering whether the future in development has to do with smaller communities, rural areas, or the microeconomy, and if there aren't better ways to do what we've been doing, steering away from foreign aid dollars simply a means to deliver dollars to our companies that trade in services and goods overseas.
I'm wondering whether you would address the question of the effectiveness of development dollars, be they Canadian dollars or other industrialized nations' dollars, so that taxpayers, who ultimately pay for it, can see that it does make sense to invest in foreign aid. As you mentioned in your opening remarks, we're interdependent in this world, and the better our neighbour does, the better we will do as well.
[Translation]
Mr. Lafleur: The NGOs' position is not that we should be spending more but that we should be spending better. Based on the 25 years of collaboration between CIDA and the NGOs, there are ways to target more effectively.
I would like to provide some examples of how we are spending not necessarily more but better. In this respect, we feel we are on relatively solid ground, because the Auditor General of Canada himself, two years ago, noted how the CIDA programs were in some respects in contradiction, to the degree that, between the objective of fighting poverty and the objective of promoting certain commercial interests of Canada, companies are getting involved in building dams and communications systems that don't always correspond to the needs of the majority in the Third World.
The auditor himself made some recommendations along those lines, and we are convinced that Canada, with its 25 years of experience and the sectors that are involved in international cooperation, would have the ingredients to build a less costly but more effective partnership.
We have to deplore the fact that for several years the portion of assistance going to the poorest countries has been substantially reduced. Canada was playing a role in some African countries, where we have stopped making contributions for several years now, to the extent that we found there was no future for trade relations with those countries.
From the trade standpoint, this may be defensible, but from the standpoint of compassion and a longer-term view of security in the world, the logic is not obvious.
I might point out in this regard that the United Nations has proposed that a larger share of the assistance budget go to meeting fundamental human needs. This does not mean building huge infrastructures at this point, but focusing on social development and human resources development.
It has often been said that we must instead develop resources so that the human resources already present in the Third World countries can themselves develop in order to fill the overall development needs that there are down there.
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Basically, in those countries, it is not the human resources that are lacking, quite the contrary, but often, there must be a way of supporting those resources. There need to be certain funds, not a lot, but well placed.
Lastly, I will talk about the whole issue of intervention in conflicts. For several years we have been noticing that because the problems of development have not really been addressed in the Third World countries, there are more and more conflicts. Underdevelopment produces situations of war and conflict.
We say we must develop some means of assistance, perhaps not much larger quantitatively but certainly more effective. In terms of conflict prevention, there have been some meetings over the last year in which the NGOs and the Canadian Armed Forces have begun to examine together the possible complementarity of their resources. There are some situations in which the Armed Forces should intervene, but how might they do so in a more general framework or in a way that complements the NGOs? Human needs are being taken into account.
We say we must greatly increase the consensus-building and joint action between the various organizations working in the Third World, so that the great expertise that Canada has developed over the last 25 years can be put to use in the interests of more effective intervention.
The Chairman: Thank you very much.
[English]
Mrs. Brushett.
Mrs. Brushett (Cumberland - Colchester): There is one point I would like to follow up on with Mr. Whittingham with regard to the CIDA and the funding as well. It's been suggested to us that we should use our unemployed youth and let them do the work rather than sending quantitative dollars that we don't have here in Canada.
Mr. Whittingham: Well, speaking for my own organization, Development and Peace, we have never sent people overseas. We rely on partners in countries of the Third World who we feel have a better understanding of their own situation and their own problems. We provide help to them to give them the tools to allow them to make changes. I believe many of the other Canadian NGOs have been cutting back drastically in recent years in terms of the number of people they send overseas.
So I really don't think that is a solution, if that's the sense of your intervention.
Mrs. Brushett: Well, we're looking at it in two ways. As you know, deficits have certainly been strangling the country, so it's looking at the funding as well as looking at how to use our highly educated youth in a very productive way to help countries.
Mr. Whittingham: There's obviously a possibility to use some people, but I don't see it as a major strategy. In a sense it's exporting our problem or temporarily solving a problem here. I'm not sure that large numbers of Canadian aid workers going overseas is the way to go.
[Translation]
Mr. Lafleur: Most Canadian organizations are aware that the human resources are very considerable in the Third World countries, and have great potential. Exporting our own unemployment problems to countries in which, in some cases, unemployment or underemployment are already at 50 per cent would certainly not be a solution.
So we have to find a medium term. I think it is important that Canada's young people develop contacts with the societies of the developing countries, but this is certainly not a solution to our own problems of underemployment.
[English]
Mrs. Brushett: Mr. Chair, if I may, I have one quick follow-up for Dr. Diamond.
We've been doing a lot as a task force of the federal government to look at our research and how we get more commercial applications flowing from it. It seems there's plenty of venture capital out there, but how do we connect and link that venture capital to the entrepreneurs? Then how do we make them aware of what research might be applicable even though it wasn't originating in a certain area but may be tied in to some developments?
Do you think basic science research should be utilized only in universities and government-funded laboratories such as NRC? Do you have some ideas here as to how we might make that link and connect it to greater applications and greater job creation?
Dr. Diamond: We're certainly very much in favour of making the links you talk about, of course. When I say ``we'', I mean people like me who are trying to urge government to put more money into basic research.
We're not opposing the concept that we are going to make links with industry. What we are saying is if that drives what we do in our basic research then we are going to founder, because industry takes what it thinks it needs, it fosters what it thinks it needs, but very often the most important advances have not been predicted by industry. That's the whole point, you see.
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There are lots of anecdotes here. I'll give you one I just learned on Friday. We, through the networks - which we're very much in favour of, and I'm part of one of the networks of centres of excellence - have established links with industry. We promote these ourselves.
We've established a way of using our new PhDs to do their post-doctoral training in industry. We sent a number of these applications to an important biotech company in Canada to review to see which ones they were interested in. I'm not patting myself on the back here, but I discovered on Friday that they were only interested in two and they happen to be my two students.
It's not because I'm a wonderful trainer of students; it's because I, of all the ones they had, happen to run a lab where the students learned basic animal research, as it happens. They were into some of the modern biotechnology, but they had spent years learning how to do experiments. These experiments are not done in industry. They wanted my people because nobody else could do them. That's exactly a small example of where the basic research we do in the universities is not done in industry.
Mrs. Brushett: To follow up on that, then, it's been recognized by almost all the witnesses I've seen through the Atlantic region that we are failing in fundamental, basic science research. How do we support that in these pre-budget hearings? What would you recommend in a specific way that our government do to endorse or support basic research?
Dr. Diamond: I'm sorry - and I really feel badly about saying this in the sense of what others have been saying - but it comes down to money in the end. Research costs money.
Mrs. Brushett: But how do we do it? How?
Dr. Diamond: Give us the money, that's how.
Mrs. Brushett: But to the universities, to whom?
Dr. Diamond: We have the agencies. We have also the voluntary agencies, which you mustn't forget, but they're also suffering. I happen to be chair of the ALS scientific advisory committee and we're also desperately trying to fund basic research.
But the Medical Research Council and its equivalent in other areas of science are being starved. They're doing the best they can, even if we may not always agree with their policies. In effect, they don't have the money to give. We have more people crying out for the money to do this basic research than they are able to provide for. I'm talking now specifically about health-related research.
You go to international meetings and there are all the students and young people from other countries. You learn what they're doing, and we aren't able to do it. We can't compete. We are literally losing our competitive edge and, with it, all the economic spin-offs these other countries are enjoying, which come from that. So basic research really is an engine that drives the economy. It's not a luxury. It's not people living in ivory towers.
Do I sound as though I live in an ivory tower? I hope not.
Mrs. Brushett: Thank you, sir, very much. I appreciate it.
The Chairman: Thanks, Mrs. Brushett.
[Translation]
One last question, Mr. Laurin.
Mr. Laurin: I have a question for Mr. Diamond but first, I would like to comment on the last statement by Ms Finestone. We should watch out, when alluding to statements by witnesses, that we don't make them say things they did not say. Ms Finestone alluded to Mr. Dufour, who spoke about instability in Quebec. Mr. Dufour did not say that the political situation was the only factor of instability. He said it was one factor among others that he was unable to assess, the significance of which he did not know. It should not be emphasized too much.
Mr. Diamond, I would like you to tell me, if you know the answer of course, what percentage of basic research funded by the federal government is done in Quebec, compared with the rest of Canada. And even by adding government grants to basic research, how might we ensure that researchers remain in the country and don't go, after a year or two, to the United States where, it must be said, the research field is much more attractive.
The Chairman: That's a good question.
[English]
Dr. Diamond: I'm afraid I can't easily tell you the figures. Our perception in Canada is that the basic researchers in Quebec may do slightly better than in many of the other provinces through the FRSQ, for example. You have in Quebec perhaps fewer voluntary agencies than in Ontario, but we don't have in Ontario the equivalent of the FRSQ doing quite that.
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I can't give you that percentage figure, but it probably is pretty even. I don't think we're doing better or worse in Quebec than any other province, if that was one part of your question.
The other part of your question, if I understood correctly, is how do we keep our young people here in Canada. Young people are an exciting group, and I wonder, Mr. Chairman, if I might take30 seconds to tell people how little they often know about this. I'm not suggesting that you here do, but you may not.
To get to a PhD takes on average six years. During that six years when they may have a family, they are living now just above the official poverty line. When I first came to Canada in 1970, the official pay they got was less than the official poverty line.
Now they get about $15,000 a year. They do that for six years. So they start that when they're 23. They now approach the age of 29, they get their PhD, now they have to do 3 to 4 years of post-doctoral fellowship. This brings their salary up to about $25,000 to $30,000 a year. So now four years later they're 33, and now they are trying to go out to get work, and we haven't got the jobs for them.
Some of the institutes can keep them for a while through agencies. They can get support for five or six years perhaps, but the universities have been on freezes now for many years. We're not looking for tenure track positions, but even non-tenure track positions, just something that gives them a salary for a few years - we haven't got it.
It's very hard to keep them. In fact, what we're being asked to do - this is terrible - is to tell them in the middle of their careers that there is no future for them in Canada. We'd like to put them in industry, but there isn't an enormous industry in Canada. There's much more south of the border.
So at the moment the drift is inevitable. It really is inevitable. If you could just see these people. They are coming in idealistic. They're Canadians. They're drifting away.
We have to support more research by giving more positions in universities, by funding more positions in our institutes, and above all, by giving the kind of grants that make research grow and thrive, because this spins off economic benefits. There's no question about it.
[Translation]
The Chairman: Thank you, Mr. Laurin.
[English]
Mr. Grubel.
Mr. Grubel: I just have a quick comment on Mrs. Finestone's intervention. I think it's very unfortunate that she has joined this committee even just for one day, because in the past we used to have a dialogue with witnesses, and we refrained from - except for a little jab here and there - outright political attacks on each other. I don't think this has raised at all the quality of life in this committee.
I find it also, returning to the substance of it, highly ironic that her vitriolic attack on the Reform Party comes from a party that in the red book said they would pass immigration levels of 300,000, and then passed a law reducing it to 150,000, and which has without any consultation imposed what she called a ``landing fee''. I believe she's totally out of touch with the people.
I have been trying to establish whether there were any other arguments other than compassion that I could use with my constituents to refute their constantly urging me, badgering me, that the current immigration policy is bad. I'm arguing against them. I don't appreciate at all that kind of attack on me or on my party coming from a party that, in itself, has promised one thing and then has delivered exactly the opposite.
Thank you, Mr. Chairman.
The Chairman: Thank you, Mr. Grubel.
We have just a couple of minutes.
[Translation]
I wanted to suggest that each of you take a maximum of 15 seconds to give us a final message, but I noticed that Col. Henry would like to say something prior to that.
[English]
Col Henry: I want to pick up, Mr. Chairman, on your offer to let me make a few points if I cut things short earlier.
To go from where Mr. Laurin ended with respect to overall funding, you have to understand that ever since from 1970 to 1973, when the budget was totally frozen, there has been a general underfunding situation. To make it even worse, about one-third of the funds that were allocated to defence were not spent on military effectiveness, they were spent on purely political ends. I won't go into that, but they were political ends by and large.
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The recent drawdown of defence activity concentrated on a lot of those political ends, such as closing bases and so on. The problem is that the money saved by doing this was not plowed back into defence. You have the same problems in defence, only at a much lower rate. Those cuts to the defence budget did not help defence, it made it worse. That money was taken away.
With respect to what that has done to the forces - it's in the presentation, although I didn't cover it - the forces today are a shell and incapable of mounting major military operations, even peacekeeping. This is a nation that 50 years ago, with half the population, put an army, navy and air force of a million people in the field and was tremendously successful.
Today we are a G-7 nation. We have at this point in time in Bosnia 400 fighting troops. A nation of 30 million, a G-7 member, can only come up with 400 fighting troops. The Netherlands and Portugal each have 2,000.
I spent a week about a month ago down in Washington, and then I went on to Europe and talked to people in governments, in academia, and elsewhere. They're fed up to the teeth with Canada. They've had it with Canada as far as our defence contributions are concerned. This in turn has an impact on our international well-being, which has an impact on our domestic well-being. That's why CDA says that defence, relatively speaking, is as important as social programs.
If you don't have the proper international stability in getting along with your trading partners, it's going to have an impact on your economic well-being. That economic well-being of Canada, although some progress has been made, is extremely fragile.
It's fragile because of our large commitment of trade to the U.S. and so on. Our productivity is low and so on. That's why CDA makes this point.
The Chairman: Thank you very much. Fifteen seconds, Mr. Whittingham.
Mr. Whittingham: I want to say that Development and Peace believes that what we're calling for is more of an equilibrium in government policies between the need for greater competitiveness for Canadian business and the need for social programs as well in this country. There seems to be a sink or swim policy, which is no longer acceptable.
A final point is that if we can set specific figures for deficit reduction, we should be able to set specific figures as well for reduction in poverty levels. Thank you.
The Chairman: Thank you. Jack Diamond.
Dr. Diamond: I'm a scientist. I'd like to do an experiment. I'd like to speak to you as Canadians, not politicians, which means this experiment will pay off. We're not asking you to do it forever. Do it for a few years, and you will see for yourselves the benefits and then you'll keep on doing it. I won't have to ask you again.
The Chairman: Thank you. Mr. Saint-Louis.
[Translation]
Col. Saint-Louis: I'm sorry if I managed to ruffle some feathers this morning. However, I do think it is important to sound the alarm and to say that we must stop cutting back on national defence.
I think there is no more fat, except perhaps for the chairman of the CDA. So, let's give at least the minimum, to train a military organization that is capable of doing its job.
The Chairman: Thank you very much. Ms Worsfold.
[English]
Ms Worsfold: I have two points. One, abolish the head tax. Two, I agree with Mr. Grubel in that there is a backlash against refugees and immigrants. In my opinion, it's partially egged on by the pronouncements of your party. I'd call on the government to give more thought to public education about the benefits of immigration and the importance of protecting refugees.
I would point out that for reasons I don't understand, the Department of Citizenship and Immigration does not systematically or effectively promote or defend their policies. Heritage Canada's policy disallows any anti-racism dollars being spent on countering the anti-immigrant or anti-refugee backlash.
[Translation]
The Chairman: Mr. Lafleur.
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Mr. Lafleur: In a time of globalization, we wish to insist that alongside the globalization of the economy, the globalization of justice and compassion also be on the agenda. In that sense, the Canadian government should support the efforts of the organizations which, in Canada, are working on cooperation and education of the Canadian public.
The Chairman: Thank you, Mr. Lafleur.
[English]
Michael Hamelin.
Mr. Hamelin: I want to reiterate again the importance of financial planning taking into consideration the development of official language minority communities across Canada and the maintenance of institutions that support them.
I want to thank Mrs. Finestone for being here today and actually providing some enlightenment on some subjects that are very important to us.
The Chairman: All personal endorsements are gratefully received.
Mr. Hamelin: Thank you, Mr. Chairman.
Mr. Chorney: As the grandson of immigrants who came to this country and helped build it, I'd like to continue this and say that basically the government should be very careful not to rely solely on the reduction of the interest rates because of the danger that the unemployment rate will not come down as quickly as they would like.
The Chairman: Thank you very much. Did you want 15 seconds?
Col Henry: I have just a final plug. In far more lucid terms than I could ever do...please, if you do nothing else, read this article. Thank you.
The Chairman: Thank you very much.
[Translation]
On behalf of all the members, thank you very much. Today we were hearing from people who reminded us that as a humane and equitable country, we have an obligation toward those from other countries who are poor and do not have the same opportunity as we Canadians do. Some refugees from the Third World are coming to Canada.
We also heard from people who reminded us of our duty toward linguistic minorities, whether in this province or elsewhere in Canada, and people who reminded us of the proud tradition of our military forces, which are now fighting for peace and which have suffered many cutbacks, although not more than many other departments. We are going to work with them to ensure that the proud tradition of our Armed Forces is respected. You have suffered a lot, and we know it.
Dr. Diamond says that we have cut too much in the area of basic research. The 25 per cent cuts over the last eight years have had a big impact on the students, our universities and our institutions. We all know, around this table, that it is fundamental to our economic future that we have a fundamental research base in our universities.
Thank you very much to everyone for their testimony, and for helping us in our research. We will resume at 2:00 p.m.
The sitting is adjourned.