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Proceedings of the Standing Joint Committee for the 
Scrutiny of Regulations

Issue 11 - Evidence - December 1, 2016

OTTAWA, Thursday, December 1, 2016

The Standing Joint Committee for the Scrutiny of Regulations met this day at 8:30 a.m. for the review of statutory instruments.

Senator Pana Merchant and Mr. Harold Albrecht (Joint Chairs) in the chair.


The Joint Chair (Senator Merchant): Colleagues, this morning we have witnesses from the Farm Products Council of Canada.

We welcome you, Mr. Pellerin and Mr. Meredith. I'm not sure who is going to start first. Please bring us up to date. We had asked you to appear before us because of the levies, to give us an update.



Laurent Pellerin, Chair, Farm Products Council of Canada: Good morning, everybody. Co-chairs, thank you for this invitation to participate in this meeting this morning with you and also for the opportunity to share with you what we are doing on the question that you have been raising in your last letter and for the last couple of years. It's always a different commodity, but most of them are in line with the same preoccupations.

We'll first share with you this morning a little bit about who we are, what we are doing, where we are coming from, the people we are working with in this big delegation of authority to a large number of provincial marketing boards, what we have done in the last couple of years, where we are on that today, and what we are exploring for the future to make sure that our work is getting better results.

First, who we are: I'm the Chair of the Farm Products Council of Canada. My name is Laurent Pellerin, as has been said. My colleague here today is Greg Meredith, Assistant Deputy Minister with Agriculture and Agri-Food Canada, in the Strategic Policy Branch. We have a shared responsibility for the Agriculture Products Marketing Act, the APMA. I'll explain to you what this shared responsibility is.

First, our core business as Farm Products Council of Canada is with the Farm Products Agencies Act. That's the act that created the council in 1972. That's the act, under Chapter 2, that created the supply management national agency, the quota system in the poultry sector, the four of them. We're not covering dairy. We're covering poultry, so chickens, eggs, hatching eggs and turkey. We also have a third chapter in our act that covers the research and promotion agencies. We have one in Canada Beef, and we receive some requests from different groups. So we are in the investigation process of looking after those requests.

Why I'm explaining our core business is because I want to make sure that you understand why, in 1995, Canada transferred to the Farm Products Council of Canada the administration of the second act that we have some responsibility in, the Agricultural Products Marketing Act. This is probably because of the main core business we have. We have to review the activity of the agencies, work with the agencies, make recommendations to the minister, but also entertain cooperation and collaboration with the provincial supervisory boards in agriculture.

Those provincial supervisory boards are grouped in a national association, NAASA: the National Association of Agri-Food Supervisory Agencies. Through those 10 provincial bodies, we also use them not only on our core business but also with the APMA, because they know and they authorize almost all of the provincial marketing groups to collect levies or pass regulations and things like that. So there is a link there.

When I came to this job in June 2010, I had my first round at the core business and the second round at APMA to better understand what it was about. I very rapidly realized that the relations with the provinces were very short. In fact, we were meeting through this NAASA association once a year, half a day. So you understand that it's not very much. So we extended those meetings to two full days a year, and we have done that for the last several years.

We also recovered the activity of the secretariat of this committee, so we brought back the secretariat in our organization. We have one staff dedicated to preparing the agenda, the minutes and the reports. We have quite a bit of a link with those people, and meeting twice a year gave us a good opportunity to know them better. And they know us a little bit better.

Plus, starting in my first year in this mandate, we participated in several provincial meetings. Every time we are in the province, we try to organize a meeting with the provincial supervisory board there, to improve our relations with those people. I did that for the last six years. I met almost everybody on an annual basis. Sometimes we're missing one of them, but I will say that it's a very well-attended meeting, not meeting only with the provincial chair of the supervisory board but usually meeting with their full board so that they better understand our job and we better understand their job. That's certainly a big plus in this relationship.

Every time that we visit the provincial supervisory boards in their ridings, in their hometowns, we share with them a list of the dedicated authority that we have on different commodities in their province. So they are aware of that, and I think we try to raise their understanding of the fact that they have to follow up more closely on those delegations of authority to make sure that, when provincial marketing boards change their levies or regulations, if there's an impact on the national scene, they are aware of that.

Keep in mind that we are in a federal-provincial type of relation. As a national body, a federal body, we have absolutely no authority on the provincial marketing boards. They keep that status very jealously. They want to protect that very highly.

So agriculture is a shared jurisdiction between federal and provincial. Production is the responsibility of the provinces, and they certainly don't want us to be seen as imposing conditions or directing any of the regulations there.

We keep that in mind. Sometimes we certainly would have preferred to be a little tougher on conditions, but the advice we received was always to be prudent on that, not to be seen as imposing or trying to regulate the provincial marketing board. So we have that in mind.

In my past life, I chaired farmer organizations for more 25 years, almost 30 years. I was the Chair of l'Union des producteurs agricoles in Quebec, one of the strong farmer organizations in this country. Within the years I was there, I chaired a marketing committee. I chaired this committee for several years, and we did the job there to compare the 10 provincial agricultural marketing acts in the 10 different provinces.

It was quite a surprise to discover, through the study, that the marketing acts in the provinces are very different from one province to the other. When we receive a comment or a request from your committee to investigate a situation, we first have to analyze correctly what committee it is, where it is, what is the possible impact and try to keep in mind that we don't want to interfere in their provincial process.

For example, on check-offs, on levies, if I look at my home province, Quebec, you will probably understand that they don't need this federal delegation of authority to collect levies because the point-of-sale in Quebec is the farm gate. No matter where you market your product — in the province, outside the province, export — it's covered by the Quebec legislation. That's not the case in most of the other provinces. When a national organization or a series of provincial marketing boards asks for delegation of authority, we need to look at where they are coming from because it doesn't have the same importance.

Sometimes they use that federal delegation of authority to close the possible loopholes, to make sure that nobody has the temptation to bypass the system. If you want to sell in the province, our provincial marketing plan covers everything. If you want to try to sell outside of the province to avoid the collection of the levy on your product, you don't have the right to do that, for example, in Quebec. In some provinces, they have the right. Anyway, if you want to try that, we have this delegation of authority that closes the door.

I gave you this explanation because I want to make sure that you understand that, sadly, some of those provincial marketing boards didn't enact their delegation of authority correctly, not always. There are a few of them. Every year, we have one or two here and there that are not doing their job completely correctly. We will never agree, as a council, that people maintain an illegal situation or a risk situation, so we certainly try to change that situation. But, overall, before being completely illegal, they will have to collect money under this delegation of authority.

In the 90 different delegations of authority in different commodities we have, if you look at the money that has been collected, in most of the cases, 100 per cent of the levies they collect is through their provincial authority. So the risk is not for us; it's not for you. It's not for the federal government. The risk is for them. If somebody is not happy with their collection of the levy, if they think that they do that illegally, the risk for them is to lose this possibility to use the delegation of authority if they don't do the thing correctly. That's my first point.

You understand that with 90 delegations of authority, we cover a lot of different commodities in ten different provinces. I'll say nine because Newfoundland doesn't have delegation of authority up to now. So nine provinces. It's a lot. Those 90 delegations are not the only regulations that have been created under those delegations. In fact, 165 regulations have been passed under those delegations of authority. It's quite a lot.

At the beginning of my mandate in this job, when they briefed me on the APMA, I was certainly not satisfied with the way it was working. As I said, we improved the working relations with the provincial supervisory boards. We took all occasions to inform the provincial marketing boards that they have a job to do. We also looked at how we can change those delegations of authority, clean up those delegations of authority a little bit, to make sure that they are better respecting their right or their authority.

So we tried a couple of times to change that one by one. You understand the process with the triage, the RIAS and the Treasury Board process, recommendations to the minister, gazette, back to the minister, back to us, back to the minister. If we continue to do that one by one, we'll never cover the 165.

So we decided in 2013-14 to regroup those delegations of authority: first, the easy ones, the ones that need to be revoked. I'll give you an example. We have a delegation of authority to collect levies when product is moving outside of the province in tobacco, for the Quebec marketing plan in tobacco. This plan no longer exists. In fact, we never received a request to revoke because the plan is closed, so no one will write or take the responsibility to request the revocation of this authority. That's for our side to clean up a little bit. We have actually eight of them that need to be revoked.

Instead of going one by one, we thought at that time that if we treat them in batches, we can simplify the process. That's what we looked at.

Within the 90 delegations of authority, 31 of them don't need to gazette their regulations. They do that through their own provincial regulations. So those ones we don't need to change in a short period of time. We have 59 that need to gazette their changes in regulations, especially on the levies. We always find, and you found, a couple of them. We will find one of them that didn't do the thing correctly.

We faced the potato situation in P.E.I. a couple of years ago. It took a long period of time to resolve that situation. We first had a debate: Do they have the right to have a different levy with product marketed in the province and product marketed outside of the province? It was quite easy to understand that it's a little bit more simplistic if you have the same amount of money on the two levies, but it's not an obligation. They can charge a little bit more if it costs more for the product going outside of the province or less if they think that it costs less. They have this possibility. It's not because the two amounts of money are not the same that they are illegal.

Added to what I said before, it's not because their regulation under this delegation of authority is not gazetted that they are automatically collecting money illegally. As I said, most of the time, most of the money is collected under the provincial authority, and this delegated authority just closes the door to the ones that want to create a loophole in their system. So there's not necessarily money collected under those delegations of authority.

If you ask them to revoke their delegation of authority, I will tell you that they are not prepared to because it's some kind of insurance for them that they have the control of everything. You know that as soon as somebody is manipulating the system, it extends very rapidly to others, and it becomes very difficult to close the doors after that. They use the system in a comprehensive, total approach.

In 2014, we were ready to go with Treasury Board. We had discussions with Treasury Board. We were ready to go for those batch modifications. There were discussions. It took almost a year. There were a couple of changes in the analysts responsible for that file. Finally, in March 2015, they agreed that the batch approach was a good one. We developed that with Ag Canada because Ag Canada is still responsible for the policy direction on this act. We are responsible only for the administration. So we received a request from the provincial marketing board. We analyzed them and made the recommendation. We worked together on that part.

The Joint Chair (Senator Merchant): We can't just go on forever. So maybe the panel will ask you some questions that relate to what you're going to present to us anyway.

Should we hear from Mr. Meredith? Do you have a presentation to make?

Greg Meredith, Assistant Deputy Minister, Strategic Policy Branch, Agriculture and Agri-Food Canada: No.

The Joint Chair (Senator Merchant): Is it your wish, then, to let Mr. Pellerin finish?

Mr. Pellerin: I have a couple of minutes and then will be finished. I think we'll keep majority of the time for questions, if you have questions.

So in 2015, we were ready to go. Treasury Board agreed. I suspect that they didn't classify this file as a high priority in their treatment.

On our side, we measure the risk, and we also measure the financial risk. As I said, most of the money — when I say "most,'' it's really most of the money. In some cases 100 per cent of the money collected on their levy is under provincial authority. The financial risk, if you want to use the audit firms' vocabulary, is not a material risk; it's not a very important amount of money. That's probably why they didn't put that as a high priority for changes.

Then we entered into the pre-election period, the post-election period, and we just re-started the discussion with the new government to move ahead with Treasury Board. I heard this morning from Ag Canada that the triage is done. We are now back on the agenda to manage those delegations of authority by batch. We will start with Ontario. Ontario has already agreed.

So you understand, for those 59 groups, where we have to revoke, to take out the words "by order,'' we have to contact them one by one. There's no national authority to contact them. We have to do that one by one. Most of them are small groups with part-time staff, and the rollover of the chairman and board members is continuous. So in 2014 we were not in a position to contact them just like that.

I discussed this with my staff, and we started, very prudently, in 2014, because of the precaution I mentioned before not to be seen as entering into their backyard. In fact, we developed a form, very simple, one page: Who you are, who the person in charge is, who the chair and the director of your board are, how much money you are collecting, what your budget is and things like that. On a voluntary basis — I have them with me this morning — we received 60 per cent of those delegations of authority that answered this form in the first round, 2014-15, and we are continuing this effort to better know those people.

With the comments you directed to the Farm Products Council of Canada in the last couple of letters, we understand that we need to go a little bit further in personally measuring the materiality of the risk and how much money is at risk there. In the next version of the form, we'll certainly ask them for more precision on where the money is coming from — provincial marketing, outside-of-the-province marketing. We want to know the share of the amount of money to make a better decision on those delegations of authority.

As to some other options we are exploring — and we have been advised not to go there — there is a possibility. The Agricultural Products Marketing Act is a page and a half act, so it's not a very long act. But still, there's a clause where we can put in place a regulation to put conditions on the authorization or the approval of those delegations of authority. The condition could be that you have to file this form and provide that type of information, making sure that it's not seen as getting involved in their own administration but going a bit further than we are today. That's something that we put in the letter of March 24, 2015.

Do that by regulation under the act or do that through the vocabulary that we will be suggesting to the Treasury Board and Governor-in-Council in approval, imposing conditions to obtain this delegation of authority. So that's the type of thing we are exploring.

We'll certainly continue to invest, on an ongoing basis, in the building of our relations with the provinces. It's a tough exercise, I tell you, to visit them once a year. We try to manage that with actual meetings that we have in each of the provinces. We have the same pressure on our back on budget restraints and things like that, so we try to manage that with no extra costs. But I think it's possible to continue to improve this relationship.

I mentioned the differences in the acts between the provinces. I also want to mention the differences in the staffing in different provinces and the attitude. Quebec, B.C., it's almost a court. They administer the Farm Products Marketing Act as a court; it's a quasi-judicial approach. In some other provinces, it's almost policy directions. In Ontario, Quebec, 40, 50 staff, in that range; P.E.I., a person one day a week. So we have to work with that, too. I'm trying to make sure that you understand that when we direct a request to a province where there's very low staffing, the answer will not come back in the same week, in the same month, because this person has almost the same number of commodities to cover as they have in the big provinces.

That covers what I wanted to say.

The Joint Chair (Senator Merchant): So you have no timeline at all? You say that if they are understaffed, they don't answer you. Can you impose a time by which they have to answer you? How long can that go on?

Mr. Pellerin: As I said, it depends on the case. If you ask, for example, a provincial marketing board to change a levy, in some provinces the regulation obliges them to go back not only to their boards but to the annual meeting. So it could be a full year before they have the authorization to change their levy. It could be a long process. The person there can't answer within a week.

The Joint Chair (Senator Merchant): I think we'll start with questions.


Mr. Dusseault: Thank you for your presentation; it was very helpful. Of course, you are here because things are not moving forward quickly enough and the answers you are providing are unsatisfactory, in the committee's view.

Why were the periods before, during and after the election able to slow down the process of amending regulations in one way or another? This does not seem to me to be a major public policy matter. I do not see why the department's activities would slow down during the election period in order to let the incoming government make decisions in cases like this.

Why would the process slow down at those times?

Mr. Pellerin: I cannot tell you the reason. As I see the situation, it is because the matter was not dealt with during that period. The first time we were able to get it back on the agenda since the election was in the past few months, probably because there was a long list of decisions to make after the election. It took seven or eight months just to get the approval from the auditors of the agencies under supply management. That is improving, because the most recent case took three months. But the files submitted at the beginning of 2016 were approved last week, I believe, about ten days ago. Usually, not so much time is required.

Delays happen; there are new people. That is understandable, I feel. In any event, we have no control over that part of the process. We had made our requests, we set up our files, but the decisions were not made.

Mr. Dusseault: Were you always in contact with the department?

Mr. Pellerin: Yes.

Mr. Dusseault: Officials in the department told you that they could not move forward and the senior managers told you that it was not the time and that you had to wait.

Mr. Pellerin: No one told us that the files would not be worked on. The fact is that they were not worked on last year, before the election. Since the election, there has been no decision. However, that did not stop us from working on the issue. Today, for all the amendments that affect Ontario, we have an agreement from the Farm Products Marketing Commission. Ontario is our biggest group. So we worked in parallel during that time to move the matter forward.

Mr. Dusseault: Will you be able to provide a timeline that would tell us when the Treasury Board will move forward and publish the amendments to the regulations?

Mr. Pellerin: When we contact a province, with no authority to require a response from them by a certain date, we lose control of the program or the timeline. When we put a file into the machinery of government for its approval, we no longer have control over the situation. We communicate with Agriculture and Agri-Food Canada and the minister's office to make sure that the file is moving forward, but we have no control over the timeline. We are very happy when a file gets onto the agenda.


Ms. Jordan: Thank you for appearing this morning before this committee.

I have to say that I find some of your testimony quite disconcerting, for a number of reasons. First of all, we received a letter back in March saying that now the election is over, we can move forward with gathering information. This request was six years before that, and now you're just starting to gather information. This is a concern.

Then you said there are 54 groups that you have to notify one by one. You started in 2014. It's now almost 2017. You have 60 per cent, and you're going back to change the form to gather more information. When do you see this actually starting to move forward? Eight years is a long time for us to be waiting for answers on some of these things.

You have 82 orders now. I understand that there's a provincial-federal jurisdiction issue, but at the same time, from the federal perspective, you have 82 orders that need revision. I'm just concerned that two years from now we're going to be in another election phase, and you're going to say, "Well, now that we're in election, we have to wait again, and we have to start collecting information after the election is over.'' At that point, we will have been collecting it for 10 years. I would really like to know when this is actually going to move forward.

Mr. Pellerin: Certainly, if we hadn't regrouped those files in what I call batches, to make sure that we accelerate the process, you are right; probably not a lot would have been happening before the next election. But we frankly think that regrouping them by batch will shorten the process by far compared to going one by one.

Ms. Jordan: Excuse me, did you just say that you probably won't be going forward much before the next election? Is that what you just said?

Mr. Pellerin: If we go one by one. It's not because we don't want to go, madame. It's because, when we put a request in the Treasury Board process, we don't have the control of the agenda. It's no more our responsibility. So, if you ask me how much time, frankly, I don't have absolutely —

The Joint Chair (Senator Merchant): You are going by batches now.

Mr. Pellerin: By batches, yes.

For example, revocation will probably not take a long time because they agree that it's not a big impact. So the analysis there will not be complicated.

The change "by order'' probably will need a little bit more analysis on their side. Ag Canada has one; it is done. Our recommendation is already clear on that. So we are ready to proceed.

Senator Moore: Mr. Meredith, what is your role here? I was surprised to learn this morning that this national board has no authority over the provincial marketing boards. It's the first I've heard of that. What about Agriculture and Agri-Food Canada? Do you have any authority over Mr. Pellerin's group or over the provincial organizations? Who can make these things move?

Mr. Meredith: You've got a couple of questions there. Let me talk a little bit about our role.

I have a policy advisory role for the minister that includes the APMA, the act that Mr. Pellerin administers. If there were legislative change, that would be my responsibility.

But Mr. Pellerin is quite correct that we do not, as a federal government, have a specific supervisory role over provincial bodies, and that's not unique to this particular circumstance. It's something that is part of our constitutional jurisdictional relationships. Mr. Pellerin did mention to you, though, that in the APMA there is regulatory authority for establishing conditions on how provincial bodies use federal delegation, and FPCC is looking at how to use that authority to make that sure these anomalies that the committee has identified don't persist.

The issue of timeline is part of your other question: How could we make this move faster? I think Mr. Pellerin is quite correct that the regulatory process is fairly well prescribed at the federal level and involves a number of stages that include Department of Justice drafters, who are experts in drafting regulatory language. It includes a review — and a fairly extensive review — at the Treasury Board level. And it includes a number of stages of consultation, sort of prepublication of the Canada Gazette and then after the publication in the Canada Gazette, of your intention to change a regulation. That involves a consultation period.

It is somewhat of a lengthy — and I can understand frustrating — period from the committee's point of view. But it is a prescribed process that we have to go through.

I think Mr. Pellerin and the FPCC have found a way, going by province, to try to accelerate and minimize the timelines required. But the regulatory process would have to be respected, and that is a lengthy time frame.

Senator Moore: Are you the person who monitors this within your department?

Mr. Meredith: Yes.

Senator Moore: So what do you think when things take eight years?

Mr. Meredith: I think we share the committee's perspective that this should be done as quickly as possible. We understand the committee's frustration at the time it has taken.

Senator Moore: We all have the same frustration, but what do you do about it? Are you the right person, or should it be Industry Canada that is in here? Who can make this move?

Mr. Meredith: From a policy oversight role, it is Agriculture Canada and my minister that have decision-making authority. We think that FPCC is moving in the right direction, that they have a roadmap that provides them with an avenue to resolve these issues. We understand the committee's frustration at how long it is taking, but at least the roadmap forward is clear.

Senator Moore: So do you have, in your mind, a time frame for when you want this cleaned up, and do you send a note to Mr. Pellerin, saying, "Look, I expect this to be done by a certain date''?

Mr. Meredith: I think we're bound by the same constraints that Mr. Pellerin has laid out in terms of regulatory process. It will take time. For example, how much can be accomplished in parallel? How many of those nine batches or by-province exercises can occur at the same time I think is dependent a little bit on FPCC capacity but, importantly, on the capacity of the various provincial organizations. I think it's quite accurate to say that capacities at the provincial level vary, that the organizations are sometimes very well staffed, as in the example given of Ontario and Quebec.

Senator Moore: Yes, we heard that.

Mr. Meredith: Some are not. Some are not staffed by professional bureaucrats familiar with the regulatory process but, rather, are headed up by elected officials from provincial farm organizations.

Senator Moore: Do I understand that you don't really get involved in this?

Mr. Meredith: No, I wouldn't say that. I would say that we are working with FPCC very closely, especially when it comes to changing regulation, which is what we're talking about here, not the exercise of authority that's already given, but changing it. Changing it, as a policy decision, will require a Governor-in-Council decision. That's where we would become involved and that's where we are involved with FPCC.

Senator Moore: Thank you.

The Joint Chair (Mr. Albrecht): Thank you, both of you, for being here today.

I understand that the provincial marketing boards have total autonomy to set their levies — I don't argue that — but as to the levies for their products that are being sold outside of their province, whether they're the same as the levies within the province or not, it's my understanding that it's the farm council's obligation to be sure that the orders are given and that they are gazetted.

Here, it seems to me you're making it an issue about money. I don't think this committee has ever been concerned that money is missing or that money has not been properly regulated. Our concern is the legality of the monies that are being collected.

I'm not a lawyer, but it seems simple that once a regulatory body or the marketing body in the province has set their levies, then it's simply a matter of making sure those levies are followed through with the orders that are necessary to make that levy applicable at the federal level. I understand that once that happens, it has to go through gazetting and Treasury Board approvals. But I don't understand why we would have 82 of them outstanding, with legal exposure to potential challenges.

Mr. Pellerin: If you look at what I said before, I mentioned very clearly that everything needs to be legal. There's no doubt about that. That's the first point I made.

After that, we consider what the risk is, who has the risk and how much money is at stake. That's the type of thing we did. I think it was important to measure the risk before acting.

The first time they had to enact delegation of authority, it's quite easy to make sure that they did that. The problem is they can change the provincial levy as often as they want, and they have no obligation to inform us that they change the levy. Sometimes we discover after the fact that they changed a levy, everything is in order, or they missed a little bit of that, especially under the federal delegation authority.

Same thing: The provincial supervisory boards don't have the responsibility or the authority to watch this delegated federal authority to collect levies. So there's a crack in the system where it's quite difficult to follow up the changes in the future.

When I came to this job, those delegations of authority were already authorized. In fact, we did four new ones in the last year. That's the only one. We don't have 82 of those delegations of authority that are actually illegal. Most of them are legal. The 59 that use the "by order'' obligation to gazette, most of them did that. The 31 that don't need — they are completely legal, actually; no problem with them.

So out of the 165 regulations that we have, I would say that on a yearly basis, from time to time, we have one or two here and there. Sometimes it takes a lot of time — maple syrup. You understand this one. It's a case and it's in court. We agreed together to say, "Okay, we're not happy with that. We have some degree of frustration on our side, too.'' But we decided to wait for the result of the court case. How long it will stay there, I don't know.

The Joint Chair (Mr. Albrecht): Our notes indicate that 13 cases are "at risk.''

Mr. Pellerin: On my list, actually, I have four cases where we need to be a little bit more — this maple syrup court case; we're not moving. The P.E.I. beef — I think this is resolved, actually.

The other is potato. It's terminated. The first round, and you come back with the second round. Frankly, when I went to P.E.I. the last time and visited the potato growers, I asked them to organize a meeting with the political marketing board there to make sure that, face to face, we gave them an explanation of where we were. When they told me they will invest $25,000 of legal fees in that file, I said, "Why did it cost $25,000?'' Those are very small groups. It certainly doesn't make sense to invest $25,000 in legal costs in managing this change in the levy between provincial and external.

So we put a little bit of time there to clarify this file, to make sure that we come to a resolution without that big investment and legal cost.


Mr. Di Iorio: Thank you, Madam Chair and Mr. Chair. My first comments go to you. If you can give me a little time, I would like to make some remarks about the Auditor General of Canada and the Agriculture Committee. I feel that we perhaps have to be looking elsewhere for solutions.

I have mentioned this once before: Canada is a real country. We have borders, we issue passports. We have a government, provincial governments, elections. We really exist. I appreciate the assistance that Mr. Pellerin provided to the committee; I have no doubt about his good faith. But clearly, if the shortcomings are not with the people involved, they are at an institutional level and we must make that distinction. As a committee of both Houses of Parliament, we cannot simply receive the testimony. I feel that we will not have the time to come up with the solution we need in the short time we have available. I do not think that we can simply come up with a solution as we have done in other situations. The problem seems to me to be much deeper than that and goes beyond Mr. Pellerin's role, or Mr. Meredith's. I make no comment about the work they have done, because I am not able to do so. I believe in everyone's good faith.

Let me give you an example and ask a question. Earlier, Mr. Pellerin said, "There is no obligation to inform us that they changed their levy.''

This is Canada. An organization cannot simply up and decide to increase or decrease its levies; they have to be accountable. Even though the organizations may be in provincial jurisdiction, for example, they have to publish notices in the Canada Gazette and hold public consultations. Mr. Pellerin and Mr. Meredith are given the staff and the budgets to supervise and monitor the activities. So there are public tools to allow the work to be done. Provincial organizations are not obliged to do so, of course, and they answer to provincial governments as to whether they do their work well. But they do not bother to send a letter saying that they have made a change.

We provide funding and authority to the relevant entities that are represented by the people here. That allows them to obtain information one way or another. In my view, in eight years, it should have been possible to have the mechanisms in place to get the information.

I hear Mr. Pellerin making distinctions. He says that, with maple syrup, that is just the way things are. That is no criticism, Mr. Pellerin, because I really appreciated your presentation and I know that your time was limited. If we had more time, I understand that it would not have been done that way. However, there are distinctions to be made here. Some categories may be in the twilight zone, we might even say in a black hole, but there are a lot of others that are not in the black hole, because there is a whole range. But we do not have the information. We do not know what can be done immediately, in three months, in six months, in a year.

We do not have anything like that. I am not criticizing you; I understand that your time was limited, but it was presented as a block. That is why I am simply using the example in my question, and I apologize for the long preamble. But I still want to set the remarks I will make later into context.

Let me go back to your comment that there is no obligation to inform you that they have changed their levy. Mr. Pellerin, I am sure you will agree that there are other ways to find out. This is Canada; we do not have a king who decides that people are going to have to pay a couple of cents more.

Mr. Pellerin: As I mentioned before, the relationships in this legislation were built into it well before I arrived, as the result of a voluntary exchange of information between the two levels of government. It was so that no frustration should arise over the areas of jurisdiction of the two levels of government. When I arrived, I saw that the situation as it existed was inadequate.

Mr. Di Iorio: How long have you been there?

Mr. Pellerin: Since June 2010. I saw quickly that it was inadequate and that we needed to go further. If we had to revise each of the delegated authorities in a quick process, would we set some criteria? I hesitate to use the word "conditions'', because I am sure that would not be well received by the provinces. We should have a more detailed form that would let us be up to date with the information, such as the sums of money that are collected and used, and the portion of the product that leaves the province. If we had that kind of general information at hand from the outset, we would be in a better position today. Working retroactively has its limits. We have to live with the delegations that have been granted and we are seriously considering adding criteria of that kind for the delegations to come.

You are right, it is impossible at the moment for us to categorize the various commodities, to know which are in the black hole and which are in order. We know the commodities across Canada quite well. For example, ten delegations are for the dairy sector. With those ten delegations and those ten provincial marketing boards, I have absolutely no concerns that all the monies are being legally collected. We have some in the poultry sector, for chicken, which has supply management, a double regulation, that is. I have no doubt that everything is collected legally. There is no black hole in that sector. They have staff to do the work, unlike smaller organizations that do not have full-time staff, which makes it more difficult to get information. As for the 90 delegations of authority and the 165 related regulations, the vast majority are in order and operate legally.

For the illegal organizations, either we discover them, or provincial regulators discover them, or the joint committee has uncovered some. Each time, contact with the delegations was quickly made. We do not get all the answers immediately, but the contacts are made quickly and we ask again if we need to.

Mr. Di Iorio: Of the 165 regulations related to delegations of authority, we noted that the language needed to be revised in 80 of them. So that is half the texts.

Mr. Pellerin: To my knowledge, the figure of 82 would no longer apply. Consultations were held with each of the groups. The information we received helped us to clarify the situation. As for the figures I gave you this morning, of the total of 90 delegations of authority, 31 are not subject to any change. So the figure of 82 no longer applies. We are asking for eight delegations to be rescinded and 59 to be amended, meaning removing the requirement to publish a notice in the Canada Gazette. We had a discussion with the joint committee, with Agriculture and Agri-Food Canada and the Treasury Board to determine whether it is acceptable to proceed in that way. We had long discussions. We came to the conclusion that it was acceptable to remove the requirement, because that was already the case for 31 delegations. So we need an amendment to cover those 59 delegations and not all of the delegations require amendment.


The Joint Chair (Senator Merchant): Colleagues, I think at this point we're going to ask our counsel to make a comment.

Evelyne Borkowski-Parent, General Counsel to the Committee: Mr. Pellerin, is it true that the federal powers over interprovincial and international marketing of agricultural products were recognized by the courts in the 1970s?

Mr. Pellerin: Yes. As I said before, the jurisdiction in agriculture makes clear that production and provincial marketing are provincial responsibilities. Interprovincial and international trade and exports are under federal responsibility.

Ms. Borkowski-Parent: So this led to the federal government making the Agricultural Products Marketing Act. Instead of using the power that had been recognized by the court to collect levies on international and interprovincial marketing, it was a decision of Parliament at that time to delegate these powers to the provincial marketing boards for ease of administration. Then producers don't have to determine, "This potato is going to an international market, and this potato is going to a provincial market.'' It allows the board to impose a uniform levy on producers; is that correct?

Mr. Pellerin: It's correct, but it's not complete. It's not covering all possible situations.

Ms. Borkowski-Parent: But that was the intent of the act.

Mr. Pellerin: I have difficulty to agree with your interpretation of the intent, because the Agricultural Products Marketing Act was adopted in 1949. We are in 2016. I'm not aware of the date that the marketing acts were adopted in each of the provinces, but I know that in Quebec it was 1956.

Ms. Borkowski-Parent: We're diverging.

The federal government delegated its powers to the provincial marketing boards, piecemeal, in a variety of delegation orders; is that correct?

Mr. Pellerin: Can you repeat the question?


Ms. Borkowski-Parent: The federal government has delegated its powers over interprovincial and international marketing of agricultural products to provincial boards. It has delegated its powers to provincial boards and has done so separately for each agricultural product, correct?

Mr. Pellerin: Yes.


Ms. Borkowski-Parent: Then those boards have to make levy orders if they want to collect monies under their federal head of power.

Mr. Pellerin: Yes.

Ms. Borkowski-Parent: So when you say that there's no authority for the Farm Products Council of Canada to ask what's been done under those orders, I'm a little puzzled. Wouldn't you say that the very least a board can do if it's going to exercise those powers delegated by the federal government is to keep you posted on the amount of money —

Mr. Pellerin: With regard to the presentation of the situation you are making, trying to set an order, they don't first receive the delegation authority from the federal level. To receive the federal authority, they have to already have provincial authority to collect money. So the bulk of their money collection is not under the delegated authority; it's under the provincial authority. The rest of the possible collection of levies is when and if there's a product market outside of the province and/or for export. In most of the cases — look at dairy — almost none is exported. With chicken, it's same thing.

They basically have, first, their provincial delegation authority to collect the levy, and when there is a possibility or a risk that they will have to market the product outside of the province — for example, P.E.I. potatoes. They are not eating all the potatoes they are producing there. There are a lot of potatoes going outside of the province. That's one of the groups that utilizes this delegation of authority to collect levies, as well as the products going outside of the province.

As I said, in Quebec, they can collect all their levies under the provincial authority if they want, and that's the case. They only use delegation of authority to make sure they close the possible loophole there, that if somebody — and it has happened in the past — wanted to sell outside of the province to avoid a levy, they say, "Hey, by the way, we have this delegation authority, so you better follow the rules here.'' How much are they collecting under the provincial delegation? Zero.

So I have difficulty, generally, with your interpretation of the order and the real impact on the daily management of those provincial marketing boards.

Ms. Borkowski-Parent: My question was not on the management of marketing boards, and no one here is talking about regulating provincial matters. I'm saying if the federal power is used — and whether it is used a little bit, more, or very much is kind of irrelevant — wouldn't you say that's enough authority for you to collect that information and make sure that the orders are up-to-date? Some of them have not been updated in 20 years.

Mr. Pellerin: I think I've been clear on that. If there's a little bit, more, or a lot collected under the federal delegation authority, I want to know how much. Actually, all the past delegations that have been approved are not part of the criteria that have been asked for or requested by the provincial marketing boards.

Personally, if we have to do a new approval tomorrow morning — and it's not me who approves the delegation authority; it's a government process — I would strongly suggest we need those criteria there. But I'm not presuming that because someone has a delegation authority that he automatically collects money under the delegation authority. That's my basic point.

Because I know a lot of those groups, I know that most of them are not collecting one penny under this delegation of authority. It's a kind of protection against people who want to play with the system. It closes the possible loopholes. It closes the circle there to make sure that there is a well-managed system and that there are no free riders in the system. That's it.

The Joint Chair (Senator Merchant): Do you have a supplementary?

Mr. Dusseault: Just to clarify something.


If a provincial body collects a contribution for a product intended for export, you say that it collects the contribution under its provincial authority, but does it then reimburse the federal government? How does that work?

Mr. Pellerin: All the amounts collected go to cover the costs of the provincial marketing boards. No money is paid to the federal government. All of the amounts collected are used by the group concerned for its activities in administration, research and promotion.

Mr. Dusseault: The boards have federal and provincial authority, but, in most cases, they collect contributions solely under their provincial authority, regardless of whether the product is intended for export or for provincial markets.

Mr. Pellerin: Yes; in practical terms, their provincial authority allows them to collect 100 per cent of the production in the province. For various reasons, producers like their marketing boards; the regulations stipulate that they have to go through those marketing boards. Even though the product is sold outside the province, it is first put on the market in the province through a common marketing mechanism.

Mr. Dusseault: Are the monies paid at that point? Is any federal authority involved?


The Joint Chair (Senator Merchant): Can you give him a quick answer? Does the federal authority not come into play?

Mr. Pellerin: On his question?

The Joint Chair (Senator Merchant): Yes, please. He asked you if the federal authority —


Mr. Dusseault: At that point, federal authority counts for nothing, if everything goes through —

Mr. Pellerin: It does not count for collecting money, in certain cases, that is a fact. Just because the power exists does not mean that it is used.


The Joint Chair (Senator Merchant): Colleagues, we have a few more questioners.

Mr. Diotte: I want to keep it short because everybody has been fairly lengthy.

We're looking for a solution to this whole thing. Could you give us three solutions? If you could wave a magic wand, what would you do to solve it if you had absolute power?

Mr. Pellerin: The first answer is to bring some criteria around the approval of those delegated authorities, with some discussion with the provinces to make sure we're not creating a war between the two levels of government. But adding a couple of criteria to a long formula, but grabbing this information a little more clearly.

A question that has been raised by several people around the table: We want to know how much of this money is really collected under the authority. Is there money collected under the authority and who is doing that? We don't know, actually.

I know by my past experience. I've been around those groups for the past 40 years, so I know. As I said, I know there is no collecting. Maple syrup doesn't need that in Quebec, but they need this toolbox to make sure they cover all possible situations. If we ask them tomorrow morning, "You are not using, so we have to revoke,'' they would say, "No, we want to make sure we have the full toolbox in place.'' Because if a problem happens and you have to obtain the delegation of authority, it will be too long; it will be too late. That's part of the situation.

We need a couple of criteria to make sure there's better reporting, better oversight from our side and access to information. Yes.


Mr. Mendicino: Thank you for your presentation this morning.


To come back to what some of my colleagues have said, you seem to share in the frustration, but I'm not sure that many of us feel as though that frustration will be alleviated by a concrete plan to reduce the timelines and the delay that has brought you before this committee.

To come back to our counsel's question, do you agree that there is a delegated authority to you or to your officials to go back and find out whether there are outstanding amounts for the purposes of updating these orders or not? I don't know that we got a clear answer.

Mr. Pellerin: Delegated authority to national farm products to do oversight in the APMA act? No, there is nothing there to give us the authority to go back to the provincial marketing boards and impose any of the conditions. As well as other federal-provincial relations, it's on the basis of a joint or common agreement that needs to be developed.

Mr. Mendicino: I don't know if our counsel was able to hear that answer or not.

Did you catch the answer? Does that help clear up anything?

Ms. Borkowski-Parent: I'm very clear on the legal aspects of this.

Mr. Mendicino: I'm sure there are maybe one or two lawyers around this table.

Imagine for a moment a white board, a tabula rasa. How do we get the timelines down? Is it a resource issue, a rules or process issue? There doesn't seem to be a concrete, specific plan that you are presenting to the members of this committee to address the central concerns around delay. I think that's why you continue to sense some frustration.

Forget all of the corporate-speak. Just give us the fix. How do we get the timelines and the delay down? Be creative, gentlemen.

Mr. Meredith: If I may, I'll go back to counsel's earlier question. You've hit on what is a source of frustration, because the authority doesn't exist to actually compel certain behaviours. That's a challenge for Mr. Pellerin and his team. They have to rely on collaboration.

What they've proposed is to look at that authority that exists in the APMA —

Mr. Mendicino: Let me stop you right there, since you're answering my question. What does that authority look like, in plain and simple language? What would you need in the way of a regulatory instrument to do what you need to do?

Mr. Meredith: My answer isn't going to satisfy you. You manage expectations —

Mr. Mendicino: Try us first.

Mr. Meredith: As a public servant, I'm not in a position to create policy advice or to hypothetically speculate about what the solutions might be. I can describe to you what mechanisms we have and how we can use those existing mechanisms, but you can understand that my role with respect to being a witness at committee doesn't include speculating about what government policy options might exist or could exist in a hypothetical world.

I can say that Mr. Pellerin and the team have been looking at what kinds of conditions might be within their authorities to impose when they're delegating these levy authorities to provincial boards that would make the transmission of information and the conditions around which the federal authority is exercised more transparent and provide a mechanism for information flow and for appropriate exercise of authority, without stepping into provincial jurisdiction, which is a delicate area, as you can imagine.

Further to counsel's question and to yours, the only mechanism that exists right now for Mr. Pellerin and the government is to rescind the delegation, which you can imagine is a very significant step. By its very severity, it means we are rarely —

Mr. Mendicino: Can I stop you right there? If we all agree that rescinding delegation is an extreme sanction, what are some of the other more moderate sanctions or steps that could be taken that don't exist right now?

Mr. Meredith: Madam Chair, again, I'm just not in a position to speculate on policy options that might be available to the government.

The Joint Chair (Senator Merchant): We understand that.

Mr. Mendicino: No one is going to hold you to it. We're just looking for some ideas.

Senator Runciman: My thoughts are pretty much along the same lines. I'll be brief.

I know Mr. Pellerin said that they're seriously looking into this, but I don't think we can leave the meeting this morning feeling very optimistic about anything positive occurring.

From what we're hearing — and maybe Mr. Meredith isn't in a position to really comment — but it doesn't sound to me, and maybe I'm being unfair, that the ministry is looking at this seriously. I'm wondering if we should be looking toward the ministry for an answer to this. Mr. Pellerin is dealing with the tools he's been given, and he's having a difficult time. We can appreciate some of the challenges.

We talked about rescinding delegation, and we can understand the implications associated with that. What about transferring delegations? What are the implications there? If the provinces are already collecting the monies and the monies are staying in their revenue stream, what the implications of simply transferring that, getting it out of our bailiwick?

Mr. Pellerin: Transferring to the provincial supervisory boards?

Senator Runciman: Transferring the delegation with respect to levies out of province or out of country? Maybe you're not in a position to respond.

Mr. Pellerin: The same position. If we have recommendations to the minister to change the act, it would be a very different process. But we never investigated that possibility.

Senator Runciman: That's a headache out of your office.

Mr. Pellerin: It's completely out of the box, and it's not bad, but I don't have an answer for that.

Are the provincial supervisory boards prepared to accept the legal authority —

Senator Runciman: Maybe it's something our counsel can look at and then, as a committee, we can make a recommendation to the minister, since we're not getting answers here.

Mr. Pellerin: May I make a comment on the first part of your intervention?

Senator Runciman: Sure.

Mr. Pellerin: Just to bring back in your understanding that, on my side, I'm quite positive about the actual situation. We're not looking at 90 delegations that are illegal. In fact, outside of those 165 regulations that we have, we find a few here and there — actually, we have 4 out of 165. So it's not a completely bad situation.

For each of them, we addressed those things. As I mentioned before, maple syrup, we agreed to put that on hold because of the court case. So we are down to 3 out of 165. So it's not a mess. It's a situation where nobody can have our support and your support because they are acting illegally. Understand that; that's a clear point for me. But we don't have a big pile of people acting illegally there. I don't want to create this perception or to maintain this perception in any of your minds today. It's quite the opposite.

Mr. Anandasangaree: I'm going to suggest that we move forward from the witness and try to figure out how we can resolve this. We appreciate what you've said so far. To be very frank, it hasn't been very helpful.

I'm going to suggest to counsel that going forward we have people of authority who can give us a lot more guidance as witnesses, because to be fair, I don't think we got anything done today. I'm going to suggest that we have people who are able to give us a lot more direction. Having said that, I think we need to explore our options.

Madam Chair, if it's okay with the committee, I'm going to suggest that we thank the witnesses for their time.

The Joint Chair (Senator Merchant): I think we have one more question first.

Mr. Genuis: I want to say, parenthetically, that I think I heard one of the witnesses say in response to a question that they're not here to give policy advice. My understanding of the mantra of the bureaucracy is "fearless advice, faithful implementation.'' I was hoping we would at least get one of the two.

I want to ask to clarify: Is the minister aware of your appearance today and of the concerns that have been raised by the committee? Has the minister been briefed on these issues? I want to understand, ultimately as the person accountable for the department, what his level of awareness and engagement is.

Mr. Meredith: Yes, the minister is aware. I believe he's communicated with the committee on occasions in the past. Maybe Mr. Pellerin has more detail. But, yes, he is aware and takes very seriously the committee's concerns about the delegation orders.

Mr. Genuis: Mr. Pellerin, do you have anything to add to that?

Mr. Pellerin: Just to mention that every communication we have between this joint committee and the Farm Products Council of Canada, those letters and communications are copied to the Andrea Lyon, the Deputy Minister of Agriculture, who is in direct communication with the minister.

Senator Moore: I have one small question.

Mr. Meredith, in response to my ask, you said that you serve in a policy adviser role. You said the minister is aware of you being here today and of our concerns. What, if anything, are you going to tell the minister or suggest to the minister has to be done here by way of policy and some kind of a fix, as Mr. Mendicino was seeking?

Mr. Meredith: Madam Chair, I'm very sorry. I don't mean not to answer a question like that, but my policy advice to the minister is privileged to the minister. I'm not at liberty to speculate here what I might or might not provide to him.

Senator Moore: Let me interrupt you. Do you think there's anything that has to be fixed here? I'm not sure you do.

Mr. Meredith: Well, I think we've actually proposed the fix, which is to address the outstanding issues in a fairly systematic way. We will have to follow the regulatory process, and that's a long one and a difficult one. Nevertheless, the road map is there.

The other issues that we were recently talking about regarding the conditions under which federal delegations are exercised are also part of our discussions. I think that's the proposal we have right now to pursue.

The Joint Chair (Senator Merchant): Thank you very much for appearing before us. As you can tell, we have a lot of questions and frustrations. I'm not sure we got the answers. We could proceed the way that has been suggested. I don't think it's finished. But I do appreciate very much that you were here this morning for a lengthy time, and I know that you tried to answer the questions as best you could. I think you're finding your position a little frustrating as well, but there has to be some resolution that we can work toward, because this thing has been going on for a long time. I realize you're fairly new here, only a few months, but I think the committee will want to follow this up in some fashion.

Mr. Pellerin: Again, thank you for your invitation and the opportunity to share with you what we are doing. Perhaps it's not to your full satisfaction, but I hope you understand that we are working hard on it. Every time we receive a communication we activate the machinery to make sure that we respond to those requests as quickly as possible, and in the best possible manner. We're not just sending letters saying we're working on it. We contact the provincial group, move ahead and follow up as strongly as we can.

The Joint Chair (Senator Merchant): Thank you.

The Joint Chair (Mr. Albrecht): We'll look to our counsel for some preliminary remarks before we head into Item No. 2 on our agenda under "New Instruments.''

Ms. Borkowski-Parent: If the committee will allow me, I have a few announcements.

First, at the last meeting, a member had requested a flow chart of the regulatory process. We prepared that for you this morning and it's being distributed right now. It distinguishes between the regular process and the miscellaneous amendment program for Governor-in-Council regulations. I'm happy to answer any questions that members might have on this.

The Joint Chair (Mr. Albrecht): Please keep this with your packets for now. We won't discuss it today, but there will obviously be opportunities for questions at a future point.

Ms. Borkowski-Parent: It should illustrate the process linearly.

Also being distributed right now, for your information, is the proposed poster for the position of counsel that is currently vacant in our section. With the robust work that the committee has undertaken this fall, we're looking forward to having the position filled. You can rest assured that the process will be guided by the principles of transparency and merit, as it has been in the past. This is the poster that will be posted publicly so that people can apply.

Lastly, questions were raised at the last meeting regarding Bill S-2 and the use of interim orders, some of which would be made pursuant to the Motor Vehicle Safety Act. Some of the proposed amendments would have an effect on the regulatory process. Thursday of last week, you will have received a background note, which is also being distributed right now, analyzing those provisions.

On the issue of vague and subjective language, if it is the will of Parliament to bestow in a statute broad discretion to a minister, there is less basis for the committee to object. The same would not be true if that discretion was bestowed to the minister in a regulation.

The note also explains the proposed changes to the exemption order and interim orders. Once again, we're available to address any concerns that members may have on this issue.

One of the issues highlighted in the background note is the use of consecutive interim orders, which ties in to point 2 of the agenda today. May I move to point 2?

The Joint Chair (Mr. Albrecht): Before we move to point 2, I know not everyone had received this when our counsel started talking. I simply want to make sure you're aware that this posting for counsel will be posted. You all have that, and the other material relating to the flow chart.

In terms of Bill S-2, I want to make sure Senator Runciman is okay with moving directly to our agenda today and come back to this.

Senator Runciman: Yes, let's come back to it. We haven't had time to absorb it.


(For text of documents, see Appendix A, p. 11 A:1. )

Ms. Borkowski-Parent: SI/2016-26 was the fifth of seven orders made pursuant to subsection 6.41(1) of the Aeronautics Act. These interim orders, which are taken to deal with a significant safety risk, may contain any provision that could otherwise be contained in a regulation. The interim order ceases to have effect in 14 days unless it is approved by the Governor-in-Council. Once approved, the interim order expires on the earlier of one year after its making or on the date the regulations are amended.

The committee had questioned the propriety of the practice of successive interim orders when the Minister of Transport made a series of 11 interim orders on private operators. The committee then indicated that relying on successive ministerial orders circumvented the regulation-making process. Although the minister at the time acknowledged the committee's concerns, there was no commitment not to use that practice in the future.

In the case of SI/2016-26, the problems are twofold. First, when the Governor-in-Council approved the interim order, the order had already lapsed, which means that the Governor-in-Council's approval was of no force and effect.

Interim Order No. 5 was then made on June 16 and approved by the Governor-in-Council five days later, which means it will be in force until June of next year. The department confirmed that during that period of May 6 to June 15, there was no enforcement action taken.

More importantly, though, it appears that the department sees the recourse to an extended series of interim orders as an acceptable practice. This issue also takes on a broader significance when one considers the current trend of conferring authority on ministers to make interim orders in lieu of going through the regulatory process. The note prepared for you today lists eight statutes that contain that type of mechanism.

The Joint Chair (Mr. Albrecht): Members, we have a number of issues here. The department has indicated that it could be reasonably expected the regulations will be made by spring of 2017. That's one comment in our notes.

The other concerning comment is that cabinet, or the Governor-in-Council, actually approved the interim order realizing they couldn't do so because the 14 days had expired.

We also come back to interim Order No. 5, which indicates clearly that the Department of Transport continues to use this methodology.

Committee members, what are your thoughts?

Senator Runciman: Chair, this ties in, as counsel suggested, to the issue I raised last week regarding Bill S-2 and the use of an interim order related, in that instance, to being able to avoid public safety regulations requirements.

We have a history with this department's use of interim orders, and I think we should be expressing our frustration directly to the minister. It's indicated in here that they seem to be unconcerned with the letter of the law, and I think we should let them know that if we don't get some kind of an adequate response — to be considered at the time; hopefully we'll get something — we can decide whether or not it may be time to call the minister in to the committee and talk about this frequent, recurring use and extension of these interim orders, rather than moving to the regulatory stage.

The Joint Chair (Mr. Albrecht): Thank you, Senator Runciman.

Are you comfortable, committee members, with their timeline of spring 2017, or do we want to put a tighter timeline on this and, as Senator Runciman suggested, some clearer expectations?

Mr. El-Khoury: Can we define which months in spring 2017?

The Joint Chair (Mr. Albrecht): You can. The committee is the master of its own destiny.

Ms. Jordan: I'd say we respond with an April deadline.

The Joint Chair (Mr. Albrecht): That we expect regulations to be in place by April 2017?

Ms. Jordan: Yes. If not, I would suggest we would then move forward with Senator Runciman's suggestion.

The Joint Chair (Mr. Albrecht): I'm not sure they're mutually exclusive.

Senator Runciman, if we go with this expectation, do you think we need to follow through with further frustration on the part of the interim order issue?

Senator Runciman: No, I'd like to see the frustration incorporated into the letter.

The Joint Chair (Mr. Albrecht): All agreed?

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): Thank you.

I'm going to look to our counsel to see if there are any really strong priorities that we absolutely need to get to today and prioritize those. We have roughly 15 minutes left of our normally allotted time; however, we can go beyond that with the committee's approval.

Ms. Jordan: Are we going to discuss what we heard this morning?

The Joint Chair (Mr. Albrecht): We can come back to that.

Ms. Jordan: Can we come back to that while it's still fresh?

The Joint Chair (Mr. Albrecht): Colleagues, would you prefer to do that now?

Counsel, is it okay if we leave some of these other items?

Ms. Borkowski-Parent: We'll bring them back.

The Joint Chair (Mr. Albrecht): One of the other questions is that because of the timelines being severely scrunched, what are the options for meeting next week, as well as two weeks from now? We're getting behind, and I don't want to keep pushing things out indefinitely. At the same time, we have schedules. Is there any objection to meeting next Thursday if we need to?

Counsel, I should look to you first.

Ms. Borkowski-Parent: It's really up to the committee. We'll be there.

The Joint Chair (Mr. Albrecht): We don't want to put you in an awkward position; only if you can handle the extra date.

Mr. Anandasangaree: I may not be able to attend.

The Joint Chair (Mr. Albrecht): That's always the reality for committee members' schedules. We can find someone to replace you. We may not need to.

Let's move ahead with a follow-up discussion regarding our witnesses.

Ms. Jordan: I want to circle back to what we talked about this morning with these witnesses and how we didn't really get any enlightened answer, at all, in what they said and how we should proceed from here.

I think Mr. Di Iorio made a good comment in that there's obviously a problem in the system; it's not just a problem with the witnesses.

My question to this committee is: What are our next steps with regard to these outstanding problems? We have a lot of them. I couldn't believe it when they said it would be at least two years before we can even get to some of them. That, then, would give them almost 10 years.

I think this really needs to be taken further up the chain, whether that's having the Deputy Minister of Agriculture or the Minister of Agriculture appear before the committee. They mentioned Treasury Board holding up things an awful lot, which I found very interesting.

Where do we go from here?

The Joint Chair (Mr. Albrecht): It seems to me our counsel was very clear in her definition of accountability: They do have the authority and there's a reticence on their part to exercise that authority because of provincial/federal jurisdiction. I think that's inappropriate, and I think that's what we need to deal with. Are we prepared to tell them they need to start exercising their authority?

Mr. Brassard: Similar to what my colleague said, we had a sidebar conversation over here as to whether we should move it up to the deputy minister, the minister or perhaps even the Auditor General, but I don't know whether we have the authority.

I'm sure everyone around this table would agree when I say that I don't know why they exist if they're effectively not doing anything and they seem to be punting everything over to provincial authority.

Do we have the authority to have the Auditor General look into their role, their function and what it means in terms of overall governance? Or are we satisfied as a committee just to have the deputy minister or the minister come in? I think that's the question we need to resolve here.

The Joint Chair (Mr. Albrecht): I'll look to our counsel for comment.

Ms. Borkowski-Parent: As to the relationship with the Auditor General, that is something I would have to look up, rather than mislead you. I don't have that answer right now.

In the past, the chairs have written to other committees, as was suggested by Mr. Di Iorio, to apprise them of situations that could be of interest at the time, whether it was official languages or another topic.

As for the Auditor General, I'd rather look into that before I make any commitment.

The Joint Chair (Mr. Albrecht): We do have the suggestion of deputy minister or minister.

Mr. Di Iorio?


Mr. Di Iorio: As I indicated just now, I am familiar with Mr. Brassard's comments. In my opinion, this is a matter that can be entrusted to the Auditor General and I would actually like our legal counsel to do the appropriate checking. However, when you see what an Auditor General examines, this is certainly an organization, a part of the machinery of government, that he should be looking into, because we are faced with a situation where money is being collected without authority. We are a committee of both Houses of the Parliament of Canada. So we cannot just sit here, listen to that, and do nothing.

Our way of operating limits us in terms of an in-depth analysis of the situation. We do not have the resources to be able to examine this, but we can send a very strong recommendation to the Auditor General. While, legally, we cannot force him to investigate, we can send him a clearly structured letter, informing him about our concern, about our view that no solution is even beginning to be worked on, and about our major worry that money is being collected by the authority of the Government of Canada, although that authority is perhaps not validated provincially.

The Auditor General will make of that what he wants, but he will at least have been informed by a committee that represents the major parties in both houses.


The Joint Chair (Mr. Albrecht): My concern is that in terms of actually getting action, the Auditor General would simply point out the problems.


Mr. Dusseault: I agree with the proposal to send the auditor general a letter from both joint chairs because it is possible for us to advise the auditor if we see something that concerns us. He will then be free to take any steps he needs in order to conduct an investigation. That may be for the long term because we will have to wait two years or more to get the results from both sides, but I think it would be a good avenue. We could also send a letter from both our joint chairs to the Agriculture Committee to make them aware of the situation, somewhat like the letter to the auditor general, explaining our proposals and inviting them to examine the matter in more depth.

Then, as for the report, I do not know whether this is the best time, but we could hear what our colleagues have to say about it. If we want to submit a report requiring a response in 120 days, the government would have to prepare a response. I do not know if this is the ideal time to do that.


Ms. Jordan: To Mr. Brassard's point, they kept punting it to provincial authority because they said they're a joint group and they have the provincial and the federal regulations.

They're not the only group that has that type of structure where there's provincial and federal, and yet we don't see anyone else appearing before us with these kinds of problems. Why is it a problem for this group specifically to have a joint provincial-federal regulation governing body, but we have not seen this same type of problem in other organizations? That's my question. Is there a different structure for them than everyone else, or are they really just not doing what they need to be doing?

Ms. Borkowski-Parent: It would be speculation on my part at this point. As Mr. Pellerin hinted, provincial boards are guarding their jurisdiction very strongly.

That being said, as I mentioned, the federal power over agricultural products marketed outside of the province has been recognized by the court. It is a valid federal power; there's no doubt about that. There seems to be a reluctance to see that that power, when you collect a levy on a potato going outside the province, is actually a federal power. The money is still going to the provincial board, but it's because the federal government has delegated that authority to the provincial boards.

But as to why, specifically, they seem to have greater problems, I couldn't say.

Ms. Jordan: There are other organizations, though, that do have this same type of set-up. There are other groups within this government that have the same type of provincial-federal board structure. Is that correct?

Ms. Borkowski-Parent: Whenever we talk about commerce, anything that is provincial will fall to a provincial head of power, and anything interprovincial and international will fall under the federal head of power.

In that instance, because it was difficult for producers to say, "This is going here and that is going there,'' historically I think the agreement was made with the federal government that to prevent having to distinguish the end use of a product, the federal government would not collect the levies and would let the provinces handle it.

Ms. Jordan: My concern, then, is why this group has more problems or appears here without other groups having the same type of issue. That's something I want to point out.

The Joint Chair (Mr. Albrecht): Your point is well taken. That's something we need to follow up on.


Mr. Di Iorio: I agree with bringing in the minister, but the second part of my suggestion is that we send this matter to the Agriculture Committee for investigation and study. The three major political parties are represented on that committee, so they can call witnesses, bring in experts and explore the situation in depth. That is something that our way of operating does not permit.

Ms. Borkowski-Parent: The other option would be to submit a report on a situation that our committee finds of concern in terms of the orders made under the aegis of the Farm Products Council of Canada. The report would be submitted with a request for a response from the government in 120 days.

Mr. Di Iorio: The reason why I mentioned the Agriculture Committee is that Mr. Pellerin has put everything together and has come up with nothing. Well, he came up with a little by indicating that the dairy and poultry sectors are in order and that the situation is different with maple products. However, he seems to have put everything together. The Agriculture Committee has experience in these matters and could, in my opinion, specifically examine the situations as presented. That is why I mentioned that committee.


The Joint Chair (Mr. Albrecht): The way I see it, at this point we have basically five or six options. We could ask the minister or deputy minister to come in; we could send a letter to the committees; we could send a letter to the Auditor General; or we could discuss the issue of filing a report with Parliament.

We're all over the place right now. I hear various perspectives on that. I think we'll have to decide priority-wise. My opinion would be to start with the minister and the deputy minister together, make them aware of this issue and have them address it, before going down all those other routes. They're all in our toolbox. That's my personal perspective; it's the committee's call.

Mr. Anandasangaree: I'd like to get our counsel's view.

Ms. Borkowski-Parent: The deputy minister, as Mr. Pellerin mentioned, is cc'd on all the letters that we send. She was supposed to appear this morning, but there's been a change of date and Mr. Meredith was sent this morning. But Ms. Lyon is aware.

Mr. Anandasangaree: Do we not subpoena the witnesses?

Ms. Borkowski-Parent: No, it's an invitation.

Mr. Anandasangaree: We do have the power to subpoena, right?

Ms. Borkowski-Parent: Correct.

Mr. Anandasangaree: At what point do we use that?

Ms. Borkowski-Parent: When the committee decides to exercise its powers. It's a motion.

The Joint Chair (Mr. Albrecht): I'm looking to the committee for direction and motion to move forward with one of these options.

Ms. Jordan: I move that we strongly invite the deputy minister. What I would think we should do is tell her that we did not get the answers that we wanted this morning; that the gentleman who stood in her place — the policy adviser who can't talk about policy — did not answer our questions. I would really like to see the deputy minister appear before this committee. If she says no because there's no time, then I think we have to move to a subpoena.

Mr. Brassard: I would support that motion. In the context of the Auditor General and the deputy minister appearing here, I think we should advise the deputy minister when she's here that we've had discussions about potentially bumping this up to the Auditor General if no fix is found for this issue.

The Joint Chair (Mr. Albrecht): Thank you, Mr. Brassard. I think she will be reading the minutes of this meeting carefully, but that's a point well taken.

All in agreement with inviting the deputy minister to try to get further answers on these questions that were not answered today? All agreed? None opposed. That is carried.

Counsel, do we need to take any further action to help you?

Ms. Borkowski-Parent: No.

Is it premature to write the letter to the Auditor General and the other committees? Or should we go ahead with that as well?

The Joint Chair (Mr. Albrecht): My understanding is that we are going to go ahead with the deputy minister. She will be aware of this from reading the minutes of this meeting. We can also inform her in the letter, if you want, that that is an option, but at this point we're going to start simply with the deputy minister. That's my understanding of what the committee just moved.

Ms. Borkowski-Parent: All right. Thank you.

The Joint Chair (Mr. Albrecht): It's 10:15. As far as I'm concerned, we have the option of going another 15 minutes and possibly finishing our agenda, or we can adjourn now and call another meeting.

I see general agreement on continuing. Do we have agreement on that? Okay, we'll continue until 10:30 if necessary.


(For text of documents, see Appendix B, p. 11B1.)

Shawn Abel, Counsel to the Committee: Three matters were raised with respect to this instrument. There is agreement to make amendments addressing the first and third issues, which would establish how the date for a payment sent by mail should be determined and would require a notice of violation issued under the act to contain a notice number, which is then required to respond to that notice of violation.

With respect to the second matter raised, it was questioned whether paragraph 10(1)(p) of the act might be a relevant enabling authority. This enabling provision was not cited in the recommendation preceding the instrument. The agency agrees that it would be a relevant authority but will seek the confirmation of the department before confirming that.

If members are satisfied, a letter could be drafted seeking a progress report on the promised amendments and a final answer on that one point.

The Joint Chair (Mr. Albrecht): All agreed?

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): Again, the timelines in the May 3 letter are very vague. The committee is prepared to put tighter timelines on that.

Mr. Abel: Should we ask for a firmer timeline?

The Joint Chair (Mr. Albrecht): I would. They're saying "in the coming months.'' That's a pretty general statement. How many? Do you want to put a number there? Three months? All in agreement with three months?

Hon. Members: Agreed.










(For text of documents, see Appendix C, p. 11C1.)

Mr. Abel: This is a fairly lengthy file. I should inform members that a letter came in on November 25. It was intended to be circulated but then it didn't seem like we would get to it, so it wasn't circulated. I'll discuss the content of it as we go through.

Responsibility for these regulations is split between the Department of Immigration, Refugees and Citizenship and the Canada Border Services Agency.

Beginning with matters under the CBSA's purview, 20 issues were resolved by amendments to the regulations, which were made this year. There are six matters where the agency promised some time ago to make amendments, but these amendments have not been mentioned in recent correspondence. There are also two outstanding statutory amendments the agency has agreed to pursue. These would address a drafting deficiency in the act and clarify questionable authority for certain regulatory provisions.

In its letter of June 18, 2015, the agency stated it was reviewing possible approaches but also strangely suggested that it might consider non-legislative avenues. It was unclear what that could refer to, and a further inquiry was made, but the agency's March 15, 2016 letter only stated that an explanation will be forthcoming later.

Finally, there are also two substantive points still outstanding. These are discussed in the analysis session of the note prepared for today's meeting and also in the November 25 letter received by the agency. The letter mentioned also discusses unrelated matters on another file.

Concerning, first, section 39 of the regulations, which is on page 3 of the note, the agency's reply could be considered satisfactory. Section 39 identifies three classes of persons that an officer must allow to enter Canada following an examination. Initially, it seemed like this might conflict with or override other requirements that foreign nationals must meet in order to enter the country as a temporary or permanent resident. The agency's letter provides confirmation requested by the committee, which is that the classes set out in section 39 are special cases for which neither permanent residency nor temporary residency status applies. Therefore, it seems there is no conflict.

Turning to the second matter, on page 4 of the note, subsection 47(2) requires that someone who posts a guarantee for a person or persons entering the country must be able to ensure that the persons will comply with conditions imposed by an officer. Previous replies clarified that an officer must determine whether the guarantor has the capacity to ensure compliance, and the agency indicated that there are a number of factors that an officer ought to consider. These factors direct an officer to consider family ties of the guarantor, their financial situation, their previous history as a guarantor, or surety under the act, and any potential association with known or suspected criminals.

Although the agency stressed that the circumstances an officer must consider vary widely, the factors listed by the agency appeared to be relevant questions that one should ask in every case. Members therefore considered, the last time this file was reviewed, that these factors ought to be expressly set out in the regulations in order to avoid the possibility of arbitrary treatment of persons in similar circumstances.

In its recent letter, the agency disagrees. It cites a preference to make changes to their administrative policies instead. Administrative documents, of course, are not binding on officers and they may be changed at any time without notice. The agency suggests that a regulatory amendment would create "a minimum set of factors to be considered by officers.'' It is unclear why that would be objectionable.

It is also stated, given the variability of cases, that it is not practicable to identify an exhaustive list of factors. The committee, of course, did not suggest an exhaustive list of factors but rather a general set of factors that the agency itself had already identified.

The agency also noted that regulatory amendments would need to be drafted in a way that would allow officers to consider other factors not listed. This hardly amounts to an objection. It is both obvious and trivial. Requiring an officer to consider a set of general factors would not prevent the consideration of any other relevant factor — in the agency's own words, what would be put down as a minimum set to be considered.

The end of the letter seems to indicate that the agency has already begun examining how to change its administrative policies and has put aside the possibility of regulatory amendments. Perhaps, then, a further response from the committee is warranted.

In sum, with respect to the CBSA's area of responsibility, if members wish, a further letter could be drafted seeking a substantive response concerning the two outstanding statutory amendments, an update on the six promised amendments that haven't been mentioned in some time, and seeking the agency's reconsideration on this last point concerning guarantors.

I would suggest, perhaps, that members consider that question before I move on to the department's responsibility.

The Joint Chair (Mr. Albrecht): Are there any comments from members?

I know for me, as a member of Parliament and I'm sure all of you, this issue comes up frequently in our constituencies and I often wonder how objective the process is. I think this is something the committee should be seized with. I don't know if any of you have that same issue with visas being denied and what sometimes seem like very subjective rules.

I look to the committee for comments.

Mr. Genuis: What always baffles me about immigration cases is where people seem to apply multiple times and get different responses. There's a sense that if you apply again it might be viewed slightly differently based on who is looking at it, in terms of the subjectivity of it.

I agree, Mr. Chair, that we need to pursue this and push back to get the clarity that we have always thought appropriate.

The Joint Chair (Mr. Albrecht): I'm seeing general agreement. Unless I hear specific further comments, I'll ask our counsel to follow through with a request that this be addressed.

I think you've hit on it, especially in the last sentence at the bottom of page 4:

. . . at least in a general fashion, in order to ensure that similar persons in similar circumstances are not treated differently for arbitrary reasons.

That's the nub of the issue here.

All agreed? We'll move forward with that. Thank you, counsel.

Do you want to move on to the IRC?

Mr. Abel: Turning to the matters under the department's responsibility, the department's letter of May 27, 2016 agrees that subsection 20(2) of the Financial Administration Act was incorrectly cited in making these regulations, and I can confirm that more recent amendments to the regulations have not included that citation.

As with the CBSA, six amendments promised by the department have not been mentioned in some time, and this leaves eight other outstanding matters for which amendments are now promised.

There are some further issues I need to discuss on two points, however. I would draw members' attention first to point 67, on pages 7 to 9 of the note. The committee has questioned whether reference to an offence of a sexual nature is sufficiently clear in subparagraph 133(1)(e)(i). Given that the term used in the French version — infraction d'ordre sexuel — is the same as the heading above the portion of the Criminal Code dealing with sexually related offences, it was asked whether these were the offences that were intended to be included.

The department previously responded that the term is meant to be open-ended and not limited to just those offences. Those offences are listed, however, along with others in the relevant administrative manual maintained by the department as offences that could qualify under this term.

At its last review of this file, the committee did not accept the department's assertion that it ought to remain open to officers to decide on a discretionary basis what would amount to an offence of a sexual nature. Whatever offences are intended to be included ought to be expressly stated, since the department has given no reason as to why this could not be done. Doing so would help to avoid arbitrary treatment, especially in relation to such serious concerns.

It is particularly unclear why any offence listed under the heading "Sexual Offences'' in the Criminal Code should not be considered a sexual offence for the purpose of sponsoring a person's entry into Canada. The department's reply primarily acknowledges that there is a discrepancy between the French and English terms, but this was never the committee's concern. While the terms do not align with the headings used in the Criminal Code, and it may be preferable to align them, the Criminal Code is not the enabling act for these regulations.

With respect to the committee's actual stated concern, the department states that it will examine ways to ensure all relevant convictions are considered. Perhaps, at the least, confirmation ought to be obtained that this means a clarification will be made in the regulations themselves.

Next, I would draw members' attention to point 92, which is on page 10 of the note.

The committee identified a possible conflict between section 180 and two other provisions dealing with requirements for persons entering Canada on a temporary basis. The department previously provided a satisfactory explanation as to why these provisions are not in conflict, but members recommended that section 180 ought to be clarified to make this clear to readers. The committee suggested a possible wording to this effect and the department's most recent reply only took issue with the appropriateness of that suggested wording.

While the given explanation is certainly valid, the department did not go on to indicate whether it would agree to an amendment, generally. The department may obviously employ any wording it would prefer as long as the application of section 180 is clarified. This was put to the department again in a June letter, but a further response has not been received.

To sum up, on matters under the department's purview, a letter could be drafted seeking a report on the promised amendments, including those earlier amendments which have not been mentioned in some time, and I would suggest perhaps a further commitment could be obtained with respect to points 67 and 92.

The Joint Chair (Mr. Albrecht): Thank you, counsel.

I want to refer to page 6, three quarters of the way down, just above number 61: an amendment is promised but, again, no timeline. Is it appropriate for us to suggest a timeline there?

Mr. Abel: If members wish, I will convey that.

The Joint Chair (Mr. Albrecht): There are very vague commitments here that really are meaningless. Under that one I would suggest we put a timeline. Four months?

I would make the same suggestion at the top of page 7, relating to Item No. 61, and the words "in the near future.'' We're getting a little more precise. Again, I think we can follow through with a timeline of four months. Is that agreed?

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): Then, at the top of page 9: "Perhaps a firmer commitment should be sought.'' I think we're agreeing that should be the case. We'll follow our counsel's recommendation on that.

On number 69, no timeline. We would, again, propose four months.

On page 11, it's the same thing; an amendment needed. They agreed to the change in wording, but they're not actually agreeing to the principle of the one possible suggestion in wording.

I think we're in general agreement that we should include timelines in all of our expectations. All agreed?

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): So ordered.

Committee, do you want to continue for another few minutes?

Ms. Jordan: I'm sorry. I have a meeting in 15 minutes.

The Joint Chair (Mr. Albrecht): We have the option of calling an additional meeting or deferring this for two weeks. I look to counsel in terms of the priority of these items.

We have Parks Canada coming again in two weeks, so we'll still be here. We'll be here until Christmas.

Ms. Borkowski-Parent: I can bring those items back at the next meeting. There aren't that many.




























Ms. Borkowski-Parent: If I may just say, so I don't have to bring them back, 27 statutory instruments were found to be satisfactory and met all the committee's criteria. We would usually close those files, if the committee agrees.

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): Those are at the end of our agenda.

Ms. Borkowski-Parent: Those are on pages 5 to 7. I can bring Items No. 5 to 9 back at the next meeting.

Mr. Dusseault: When is the next meeting? Is it on December 15?

Ms. Borkowski-Parent: Yes.

Mr. Dusseault: I'm not as optimistic as you that this meeting will happen.

The Joint Chair (Mr. Albrecht): Suppose it isn't on the December 15. Are we putting anything in jeopardy by leaving it until the first week back? I'm looking to counsel.

Ms. Borkowski-Parent: The first meeting back would be in February. Keeping that in mind, should the committee want to have an extra meeting to cover those items, it shouldn't be very long.

The Joint Chair (Mr. Albrecht): I'll look to the committee. Would you prefer to meet next week and clear the deck so we could come back clean, or do you want to take the chance that we will be here on December 15? I think we will be, looking at the agenda that's coming down. You're right; we may not be.

Mr. Dusseault: I would suggest meeting next week.

The Joint Chair (Mr. Albrecht): Is there agreement? I think I see general agreement. We'll meet next Thursday morning at 8:30, and we will probably not be here for more than an hour.

Mr. Genuis: You said it would go an hour. Can we firmly schedule it to end before 10:00 to make it easier for those with house duties — or not, but just so we have clarity on the end time.

The Joint Chair (Mr. Albrecht): So 8:30 to 10:00. Thank you very much for your patience.

(The committee adjourned.)

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