Proceedings of the Standing Senate Committee on
National Finance
Issue 41 - Evidence - May 29, 2013 (Evening meeting)
OTTAWA, Wednesday, May 29, 2013
The Standing Senate Committee on National Finance met this day at 6:46 p.m., in an open sitting, to consider the subject-matter of Bill C-60, An Act to implement certain provisions of the budget tabled in Parliament on March 21, 2013, and other measures introduced in the House of Commons on April 29, 2013.
Senator Joseph A. Day (Chair) in the chair.
[Translation]
The Chair: Honourable senators, this evening we are continuing our consideration of the subject-matter of Bill C-60, An Act to implement certain provisions of the budget tabled in Parliament on March 21, 2013, and other measures.
[English]
Honourable senators, this is our seventh meeting on the subject matter of Bill C-60. This afternoon we completed our review of the various clauses with government officials, so we have been through the entire bill on one occasion and we are now moving to witnesses outside of government who have an interest in this bill or who might be impacted by the legislation of the proposed bill.
We welcome Laura Eggertson, President of the Adoption Council of Canada. She will be speaking to Part 1, clause 9, changes to the Adoption Expense Tax Credit. This can be found at page 4 of the bill. Each of us has the bill in front of us, so if you need us to refer to the bill we can do that.
We also welcome Neil Pierce, President of the Alberta and Northwest Division of the Multiple Sclerosis Society of Canada. He is also the National Vice-President, Government Relations and Volunteer Engagement. He will be speaking on Part 1, clause 10, the first-time donor credit. This can be found at page 4 of the bill as well. There are two items and two presentations in relation to page 4.
Finally, we welcome Rob Cunningham, Senior Policy Analyst for the Canadian Cancer Society. He will be speaking on Part 2, clauses 53 to 61, measures relating to sales and excise taxes and excise duties. This can be found at pages 41 to 43 of the bill.
I would ask each of our guests to present brief introductory remarks and then we can engage in a discussion, question and answer comment. We will start with Ms. Eggertson.
Laura Eggertson, President, Adoption Council of Canada: Thank you very much, Senator Day and committee members, for the invitation to address you today.
As you have heard, my name is Laura Eggertson. I volunteer as the President of the Adoption Council of Canada, which is a national non-profit organization. I am here today as an adoptee and as an adoptive parent. I adopted two young women from foster care when they were eight and nine respectively.
We hope the changes to the adoption tax credit that the federal government introduced in this budget and that you are here to look at today will help more families who are considering adoption.
As the budget document mentions, there are roughly 30,000 children and youth in foster care across Canada who are available — meaning legally free — for adoption but who do not have permanent families. Many of them are Aboriginal, as Aboriginal children are overrepresented in the foster care system. The sad reality is that only about 2,000 children and youth are adopted from foster care every year. About 1,000 children are adopted privately, in addition to the 2,000 from foster care, and another 2,000 or so are adopted internationally.
As a country, we need to make finding permanent families for these children and youth a higher priority. These tax credit changes extend the time period in which adoptive families can claim expenses related to an adoption. Those expenses may include the cost of private home study or pre-service parenting training which parents in many provinces and territories must undertake before a child or youth is placed in their home.
In Alberta, for example, families may spend $12,000 a year to adopt privately. Previously, families could only claim those expenses in the year in which they occurred, even if they occurred several years before they adopted a child. That left many people unable to receive the full benefits of the tax credit, which is a 15 per cent non-refundable credit on up to $11,669 worth of eligible expenses.
The difference with this change is that now families will be able to claim all the expenses in the year that they adopt, no matter when the expenses actually occurred. As long as they have registered with a province or an agency to adopt a child, from that moment going forward they can claim the expenses even if it takes two or three years to actually have a child placed with them.
You may wonder whether this is an important change. To us, it is important not only for the way it will offset adoption expenses but because of the message it sends. It sends the message that our federal government cares about our Canadian children and teenagers who do not have permanent families.
These young people come into foster care through no fault of their own. We take them into care without their consent, but for their protection. We remove them from family members they love. We may separate them from their brothers and sisters. Then we shift them around from home to home, often for the rest of their lives. Traumatized and grieving, they spend those lives trying to adjust to each new home and new family. They have wonder how long each family will last. Most of them will not last.
Youth age out of foster care at 16, 18 or 21, depending on their province. That is when we consider them old enough to manage on their own, without permanent families to support and celebrate the milestones in their life. As one 21- year-old graduate of foster care recently asked, ``Who will come to my university graduation?''
As parents, all of us know that children need our support long after they have turned 18. They may even need us more in those post-teen years as they struggle with attending college or university, finding a job and starting their own families, especially in this economy. Without permanent families, many youth who age out of foster care end up homeless. They come in contact with the justice system. They live on social assistance, become teen parents and they may see their own children in foster care. The cycle continues.
At the Adoption Council of Canada, we believe we need to change the system to make it easier for Canadians to adopt children and youth of any age, or to make other permanent connections through kinship care, legal guardianship or customary care. One young man told us recently at age 17 that he was still seeking an adoptive family. ``I just want parents who will tuck me in at night,'' he said.
These changes to the adoption tax credit are a first step. We believe there is a strong leadership role that the federal government can play. We look forward to continuing to work with the government in the coming months and years on more ways to encourage adoption and permanency.
We would ask the committee to support these changes. I would be happy to answer any questions about these and other measures that the federal government can take. Thank you.
The Chair: Thank you very much.
Neil Pierce, President, Alberta and Northwest Division, Multiple Sclerosis Society of Canada: Thank you very much for this invitation to present on our first-time donor credit.
On behalf of the Multiple Sclerosis Society of Canada, I want to open by telling you a little bit about our mission. Our mission is to be a leader in finding a cure for multiple sclerosis and to enable people affected by MS to enhance their quality of life. People living with MS in Canada are our number one priority and are at the centre of everything we do in terms of funding research and providing services right across the country.
We support the measures in Bill C-60 that strengthen the capacity of the Canadian charitable sector to support families and individuals living with illness and disability.
We are encouraged by the recognition in Bill C-60 of the importance of and need to foster and promote a culture of giving in Canada. From 1990, the percentage of tax filers claiming donations has dropped by 29.5 per cent to 23 per cent in 2011. Over this period, the number of tax filers has increased by approximately one third, but the number of tax filers claiming donations has increased by just 3 per cent. The Canada Survey of Giving, Volunteering and Participating found that the majority of Canadians would give more if better tax incentives were in place.
The inclusion of this new, temporary, first-time donor's super credit for first time claimants of the charitable donations tax credit will encourage all young Canadians to donate to charity. This is an opportunity for us to grow a new generation of donors and to be able to teach young people about philanthropy. Encouraging new donors will also have an additional benefit of helping us to increase the number of volunteers that are helping our charitable sector across the country. Just like we are seeing a decline in the number of donors, we are also seeing a decline in the number of volunteers.
Furthermore, to build capacity in the charitable sector, we recognize the importance of considering future tax measures like the stretch tax credit, which provides incentives for existing donors to give more. These are average working families, typically people with the most money give more in the way of donations, the consideration of the stretch tax credit will enable more Canadians to be able to invest and support the charitable sector.
The stretch tax credit for charitable giving would increase the federal charitable tax credit for individuals by 10 per cent on all new giving that exceeds previous donations. This incentive will allow Canadians to ``stretch'' their giving even more. Research shows that more than half of donors would probably increase their giving if there were better tax incentives. This proposal should also be given priority in planning for future budgets and would build very nicely on the super tax credit introduced this year.
For the Multiple Sclerosis Society of Canada, these tax measures are critically important because we rely on donor income to meet the growing demand for MS services and to fund the $10 million that we contribute to research on an annual basis in search of a cure. To give an illustration, we raise over 96 per cent of our own money. We raise it $20 to $100 at a time, through special events for the most part, and we have a couple hundred thousand donors. Many of our donors are also aging, like myself, and I think there is an opportunity for us to reach their children, family, friends. These are the people who support us. This measure would be critically important in helping us to sustain our capacity to be able to do even more to help Canadians across the country.
I would like to take this opportunity on behalf of the society to thank you for this invitation, and I look forward to answering any questions.
The Chair: Thank you very much, Mr. Pierce. Mr. Cunningham?
Rob Cunningham, Senior Policy Analyst, Canadian Cancer Society: Thank you Mr. Chair, senators. I am the senior policy analyst with the Canadian Cancer Society.
[Translation]
Thank you for this opportunity to come and appear before your committee today.
[English]
First, let me acknowledge the important work he Senate has done over many years with respect to tobacco control. For example, Senate bills such as the Tobacco Youth Protection Act, co-sponsored by Senators Nolin and Kenny as Bill S-13 in 1998, Bill S-20 in 2000 and Bill S-15 in 2001 were on each occasion approved by the Senate. These bills contributed to the announcement in April 2001 of the Federal Tobacco Control Strategy. Among other examples, in 2006 the Senate adopted a motion urging that all federally regulated workplaces be 100 per cent smoke-free. This was followed by strengthening amendments to the Non-smokers' Health Regulations to do that.
Today, my testimony will focus on the tobacco tax increase in sections 53 to 61 of Bill C-60. This tax increase is to respond to a loophole, and applies only to the tobacco product category described as manufactured tobacco, in particular, roll-your-own tobacco. We support this increase and we recommend that all senators support this measure.
From a health perspective, tobacco use remains a leading preventable cause of disease and death in Canada, killing 37,000 Canadians each year from cancer, heart disease and stroke, emphysema and other diseases. The overwhelming majority of new smokers are underage youth. Higher tobacco taxes play a pivotal role in reducing tobacco use, especially among youth because youth have less disposable income. A vast number of studies confirm exactly what one would expect, that as tobacco taxes and prices go up, tobacco consumption goes down.
Bill C-60 takes action on a long-standing loophole that has seen roll-your-own tobacco taxed at a much lower rate than regular cigarettes. At one time, historically, one gram of roll-your-own tobacco was needed to make one cigarette. The tobacco industry changed its manufacturing practices so that less tobacco would be needed per cigarette. Now, instead of one gram, only half a gram or less is needed to roll a cigarette. This exploits the tax structure based on weight and, in effect, reduces the tax to half on roll-your-own. I have some examples.
This Export A label says that you only need 0.47 grams to make a roll-your-own cigarette. It says that it rolls 100 per cent more — you can get twice as many cigarettes as you used to get because they puff up the tobacco so you need less. This different company uses the same principle — 100 per cent more cigarettes than you used to get. You need less than half a gram. This bill allows the tax structure to catch up with what the manufacturers are doing to exploit this loophole.
This exploitation of the loophole led to lower prices, which discourages people from quitting or motivates them to smoke more cigarettes per day because it becomes more affordable. This is detrimental to public health and explains why we support Bill C-60 taking action on this loophole. The sales volume of roll-your-own tobacco varies across Canada from only 1 per cent of the market in Ontario to 13 per cent or more of the market in five provinces. Thus, this tobacco tax change will be particularly beneficial in some provinces.
A comparison with respect to youth across Canada finds a surprising number of youth using roll-your-own. Data from the Canada-wide youth smoking survey in 2009 found that among high school student smokers, 62 per cent of boys and 38 per cent of girls had used roll-your-own in the previous 30 days.
It should be noted that this tobacco tax increase in Bill C-60 will apply to some other forms of loose tobacco, such as chewing tobacco, snuff and water pipe tobacco, in addition to roll-your-own tobacco. These product categories are far more popular among youth as they tend to be flavoured, and among young adults, compared to those aged 25 and older, and provide a further reason why we support Bill C-60 and why it will have an impact on youth tobacco use.
By way of illustration, this is water pipe tobacco, sometimes referred to as hookah. Many parents are not familiar with this. We have examples here of tobacco in flavours of orange, cherry and banana. It is smoked with a water pipe. Among young adults and youth across Canada, it is taking off in popularity. It is a concern because it is addictive. We have some other examples of tobacco in mint, citrus and cherry flavours. This bill will affect that.
To conclude, the tobacco tax measure in Bill C-60 is a win-win. Not only does public health benefit but also $75 million of increased public revenue will be received each year. We again urge all senators to support this measure. Thank you; I look forward to your questions.
The Chair: You do not think that the increase will result in less use and, therefore, that $75 million increase in public revenue might be a bit high?
Mr. Cunningham: When Finance Canada came up with this projection, they factored in a reduction in use.
Senator Eaton: What is the cost of an adoption?
Ms. Eggertson: It depends on how you adopt. If you adopt through the public system, there may be virtually no cost. Many parents are choosing to do private adoptions with home studies first. That could cost $1,500 or $2,000.
Senator Eaton: What is a home study?
Ms. Eggertson: It is what a social worker does to ensure that a home is appropriate for children to be placed in. All provinces and territories require a home study before anyone can adopt either internationally or domestically.
Senator Eaton: There are licensed people you hire.
Ms. Eggertson: They are social workers. There can be a home study cost. You can also choose to get what is called pre-service training, which means a set of parenting classes that prospective adoptive parents have to take. That can be done privately. A lot of families are paying for these services first so they are adoption-ready before they even go to the Children's Aid Society, for example. You have to do all that as well if you adopt internationally or privately. There can be a variety of costs.
Senator Eaton: What about foster children? Is there a cost to that as well?
Ms. Eggertson: When I adopted, there was no cost. I chose to travel because my children were not right here in Ottawa. Other than that, there was no cost to me for the home study. If I were doing it today, I might chose to spend the money to get the private home study or the training because it moves you up a little faster to becoming adoption ready. If you adopt privately, there are legal fees, and counselling fees in some provinces, such as Alberta. Those can add up to the $12,000 cost I was talking about.
Senator Eaton: Can you give me a ballpark cost to adopt two foster children today if you did not travel?
Ms. Eggertson: If I did not travel, it might cost me nothing.
Senator Eaton: You would need a home study.
Ms. Eggertson: I would have that done through the public system, in which case there is a fairly long wait time. If I choose to pay for the first two steps, which are the home study and the training, it might cost me $4,000 or $5,000.
Senator Eaton: Really?
Ms. Eggertson: Yes.
Senator Eaton: I can see why that would be a disincentive for a lot of people.
Ms. Eggertson: It is possible.
Senator Eaton: Are there expenses after having adopted a child that a parent who gives birth to a child might not have on average?
Ms. Eggertson: Yes, that is a very good question. Many post-adoption expenses or supports are not covered. For example, if you adopt a child from the foster care system, the chance is that the child has been moved through multiple homes and has experienced a fair amount of trauma. There may be abuse and neglect issues, so counselling, tutoring and respite care for families can be costs.
I am trying to think of the many things. Quite a few post-adoption expenses are not covered, especially if you do not have private health benefits. Some provinces have subsidy agreements to encourage families to adopt and will factor in some of that cost, but it is hit and miss. Even in Ontario, what is covered in terms of those kinds of expenses varies greatly between one Children's Aid Society and the next.
Senator Eaton: Is there no standard across Canada?
Ms. Eggertson: There is not.
Senator Eaton: Would you like to see a standard?
Ms. Eggertson: We would love to see a standard across Canada.
Senator Callbeck: How much do international adoptions cost, roughly?
Ms. Eggertson: International adoptions vary a lot by country, but they can run to $30,000 or $40,000 easily for a family.
Senator Callbeck: The maximum amount of the tax credit is $16,000; is that right?
Ms. Eggertson: The maximum amount is about $11,669, of which you get back 15 per cent only. The maximum would you get back after submitting your expenses figures to be about $1,700, I think.
Senator Callbeck: You mentioned that we need to make it easier to adopt. What suggestions do you have for the federal government besides increasing this tax credit?
Ms. Eggertson: How nice that you ask me that question. We have quite a few suggestions. We appeared before the House of Commons HUMA committee last year. We had a report done — a study on adoption — and we made quite a few recommendations. Right now it is harder to adopt interprovincially than it is to adopt internationally. It is very difficult to get provinces to agree to consider parents from outside their own province, even though there might be a good match outside the province. There is only one national photo listing service that lists children nationally. It is the one that we run at the Adoption Council of Canada. We get no financial support for that except from Alberta. That is a big resource that could help match both partners and children. However, we need a better memorandum of understanding among the provinces to make it easier to do that interprovincial adoption work.
We need statistics. That figure I gave of the 30,000 young people that we think are legally free for adoption is a 2004 stat. Since then, no one in the federal government has been collecting any statistics. We do not know how many kids are in care across Canada. We do not know how many of them age out every year. We do not know what percentage of them are Aboriginal. We do not know at what age they are being adopted.
There is a huge gap that we think the federal government could fill in terms of letting us know the numbers so we can see how well we are doing year over year. We cannot change it if we do not know how well we are doing.
There are many things. Post-adoption support is an area we would like to see the federal government contribute to, as well as a national public awareness campaign. Most Canadians do not know or have a lot of misinformation about children who are available for adoption, and they do not know how to go about doing it. That is another role we think the federal government could fill.
Finally, change the EI legislation so that parents who adopt get an equal number of weeks of leave as people who give birth.
Senator Callbeck: Really, you want the federal government to take a leadership role in the awareness and breaking down the barriers between the provinces, collecting the statistics and changing the EI.
Ms. Eggertson: We would love to see that happen. This is the first time we can see that the federal government has even stepped a toe in there. They created the Adoption Tax Credit a few years and are now trying to expand it a bit to help on the domestic scene, and that is important. However, we would love this to be the first in a suite of measures that the federal government undertakes.
Senator Callbeck: Let us hope it is.
Mr. Pierce, you talked about the super credit, and I certainly think it is a great step forward. You said that research shows that Canadians would increase giving if there were a better tax credit. You suggested another 10 per cent. What would that translate into in terms of dollars?
Mr. Pierce: I do not have the exact dollar amount to see what the benefit would be. This is a recommendation from Imagine Canada, and I am not sure exactly what that would translate into.
Senator Callbeck: Can you comment on this stretch tax credit that you talked about?
Mr. Pierce: The majority of giving in Canada is done by wealthy Canadians. There is an opportunity here to encourage more working families to contribute more. The stretch just increases the tax benefit for families, rich or middle income, to be able to entice them to give more.
Senator Callbeck: The more you give, the better.
Mr. Pierce: Yes.
Senator Callbeck: Mr. Cunningham, you showed a package of cherry-flavoured — that is tobacco, is it?
Mr. Cunningham: Yes, it is.
Senator Callbeck: With the new increase in Bill C-60, how will that affect the price? What does that sell for now and what will it cost with the change in taxes?
Mr. Cunningham: Different products sell for different prices, but if you had 100 grams, it will increase by about $5. Therefore, it goes from $5.78 to $10.62 in terms of the federal tax portion on 100 grams. By way of example, this is 105 grams, so this would increase by about $5.
Senator Callbeck: How many grams in that?
Mr. Cunningham: It is not well labeled. I am sorry; I do not have an answer to that question.
Senator Callbeck: Thank you.
Senator Black: I want to thank the three of you for what you do, particularly Mr. Pierce and Ms. Eggertson. Your volunteer work is a tribute to you and to your organizations, because we cannot have the quality of life that we enjoy if there are not people like you prepared to step up and make this contribution. I want to thank you both and also thank you for the work you do, because it is very important. I wanted to let you know. I do not know if you hear a lot of people thank you, but you should be thanked for what you do because it is very important to Canada.
I have one quick question for you, Mr. Pierce. In terms of this tax credit, have you done any back-of-the-envelope calculations as to the additional funds you think you will be able to benefit from because of it?
Mr. Pierce: We have not really done a real tight calculation. However, for Canadians living with MS, it is their families, neighbours and colleagues who support us. If we have 200,000 donors — and I would not classify them as young Canadian donors — I would say that we could increase our revenues substantially. I would hope that we could increase it by an additional 10,000 or 15,000 donors. It will take a lot of education, promotion and awareness. I think this is an excellent start.
Senator Hervieux-Payette: I will start with MS because I am very active and I know a bit about it. This has also been discussed a lot on the Hill with some special legislation, so maybe we are more aware of it.
If you collect more, is it to give more services to the people who are suffering from MS, or will it go to research? What proportion of the money goes to service versus research?
Mr. Pierce: We have a balanced spending policy. It is a guideline in terms of how much we spend on services versus research. We try to spend 50 per cent of net proceeds on services and the other 50 per cent on research. Our hope is to increase the amount in services and research that we can provide in order to ensure access to our services no matter where someone may live in the country.
We do not receive any government funding by way of annual core service grants. We have to raise our money and carry the overhead and hope we receive enough income to be able to pay the bills, provide the services and also ensure that we are able to meet our research commitments. These large research projects are multi-year projects and require multi-year commitments.
Senator Hervieux-Payette: Are you talking for the whole of the country?
Mr. Pierce: For the whole of the country, yes.
Senator Hervieux-Payette: Services and research should also be supported by government. If we look at the amount being given by the number of people suffering from that illness, do you compare that to your neighbour in terms of per capita? We will not compare the amount of money, but per capita, do you feel that you receive enough money to provide both services and research?
Mr. Pierce: On the services side, I would have to say that we are not reaching all Canadians. We are probably doing a good job, but we could do a much better job.
On the research front, provincial governments contribute to research. The federal government does also, but I think all of us could do more, and I am including the two levels of government, along with partners in the non-profit sector — i.e., the MS Society. I think there is opportunity for us to do much more. There are many more advancements and breakthroughs on the horizon, so I think we have to do more.
Senator Hervieux-Payette: I do not know if my colleagues are aware that it is an illness that is mostly suffered by women. Two thirds are women and one third are men. Of course, it is very well supported by women's organizations. Women in business hold fundraising every year for multiple sclerosis, and we have different women's organizations raising money in Quebec.
Is it different from province to province? You want to attract young people. I wondered which mechanism we could have to attract young people to give more to an organization like yours. You have to have some kind of a channel whereby people could send their donation, even a small amount of money.
Mr. Pierce: There is no question that there is a need to have multiple streams of revenue and that it is a very much a women's disease. We are reaching out through our networks to enlist support from women across the country that are in business. This opportunity with younger Canadians, younger girls and younger boys will just enhance our efforts.
We have a very strong grassroots-based organization, probably the strongest of any organization that I have been associated with. We have thousands of volunteers. The volunteer time is also worth money because without it we would not be able to provide a lot of the services. The more people you have volunteering is also an opportunity. Those are people who will contribute even more.
We are hoping to attract more young people as volunteers and introduce them to the charitable cause. People who support us and probably other causes are people who are close to the cause. Those are the people that we want to reach.
Senator Hervieux-Payette: Mr. Cunningham, do you think the money that will be probably collected with this could be devoted to do more education with youth? I think this is an area where we have not done enough. It is not just a picture on the cigarette pack; it is also, I think, television ads. Ensure that they are aware, and, of course, it should be through the media they use, such as Facebook and so forth. I have the feeling that this is growing with youth, not reducing. I guess I do not want this to go to National Defence; I want to give it to the youth so that they reduce their consumption.
Mr. Cunningham: We certainly need a comprehensive strategy to reduce tobacco use. Taxes are one component, legislation is another and education programs are another. The regulations for the warnings on the packages are excellent, but we know from studies and experience that sustained communications campaigns do make a difference. They need to be sustained, well funded and well designed. They impact youth and young adults. There is new media today, so, yes, it is an opportunity for us to do more, and we would support that.
Senator L. Smith: Ms. Eggertson, what steps are you taking with government to develop more support? What do you get right now? Do you have government funding?
Ms. Eggertson: We get no government funding now except Alberta gives us $10,000 a year to list some of their children on our photo listing website.
Senator L. Smith: Where does the rest of the funding come from?
Ms. Eggertson: The rest of our funding comes from membership contributions and from a very great supporter in Jockey International, the Jockey underwear folks who are a U.S. company but are very interested in adoption work and give us money for that. We have a fundraiser as well, national AdoptWalk, which takes place in Ottawa in September, and a few other small contributions.
Senator L. Smith: What is your annual budget?
Ms. Eggertson: I think it is about $96,000.
Senator L. Smith: To get the message out across a big country with $96,000 is pretty tough, is it not?
Ms. Eggertson: Yes, it is. We are always on the verge of whether we can keep our doors open because we are also the major source of information for Canadians who want to adopt anyway, for birth parents and anyone interested in adoption. We act as a clearing house as well in terms of answering phone calls and referring people to resources.
Senator L. Smith: What type of staff do you have to support you?
Ms. Eggertson: We have one executive director and a working board.
Senator L. Smith: Do you have a lot of volunteers?
Ms. Eggertson: Yes.
Senator L. Smith: You mentioned some of the things that you would like to put forward in terms of getting government support. You mentioned that it is hard to adopt interprovincially. Would one of your requests be to get the federal government to take a leadership role with the provinces? How would they do that?
Ms. Eggertson: We would like to see a first ministers' meeting on the issues of child welfare centred on adoption. We would like to bring people to the table and get them to work together on a memorandum of understanding that makes it easier for people who do want to adopt interprovincially. That might mean something like, for example, if you cannot place your children in your own province within a set time period, say six months, you open it up to parents from outside of that province. We think it needs to be easier so kids are not left in limbo their entire lives so that they age out of the system.
Senator L. Smith: What is your second request?
Ms. Eggertson: The EI issue is big for us. We think that would help because there are major attachment and bonding issues that take place for parents who are adopting, particularly older children. We would like to see an additional 15 weeks for adoptive parents — call it ``adoption leave.'' We are not trying to take anything away from biological parents and we want to stress that, because we are not interested in pitting parents of any stripe against each other. It has been portrayed that way and that is not what we are interested in, but we would like to have it recognized that we need another 15 weeks.
The Chair: Did you say another 15 weeks?
Ms. Eggertson: Adoptive parents get 35 weeks parental leave currently, but not the 50 weeks that biological parents get, which the courts have recognized is for the actual physical costs of childbirth.
The third would be a national public awareness campaign that the federal government helps to fund, working with us so that we can make Canadians aware of the need.
The fourth would be post-adoption support issues and training for social workers across the province to work with families so that when they do adopt, especially from foster care, older kids and sibling groups, they have the support that it takes to keep those families going.
Senator L. Smith: You said you wanted more data from the federal government.
Ms. Eggertson: We have no one collecting the information. We are currently engaged in trying to get the provinces to release that information to us, and we cannot even get it very easily. It would be very helpful to know how every province is doing and how we are doing as a country in terms of making permanency plans for our kids.
Senator L. Smith: Are these five recommendations that you have given me prioritized?
Ms. Eggertson: Data collection is probably the first one just because we need to know how we are doing. It is not a rigid list.
Senator L. Smith: Where are you with your efforts to try to position your group?
Ms. Eggertson: We would love the help of the Senate.
Senator L. Smith: Are you sort of nowhere, or are these the ideas you have? You talk about them, but you have difficulty getting an audience.
Ms. Eggertson: We are not having a lot of uptake, but it is moving in the right direction. We recently met with provincial child and youth advocates from across the province who are very interested in this because they have a responsibility for children in care.
Personally, I find it is hard not to get discouraged when none of our public figures speak about these issues. You would be hard pressed to find premiers ever talking about this in public or leaders in the government. Some do, and we have some champions, I think. Jeff Watson is an MP who has spoken about this issue a lot, but it is rare.
Senator L. Smith: Would Alberta be the place to attack because they actually give you money and other provinces do not?
Ms. Eggertson: Alberta and New Brunswick are leaders, and Ontario is getting better at this. Those are three provinces that I think are making good strides. It is not to say the others are doing nothing, but it needs to be a much higher priority. We need to talk about it more; we need to open up the discussion.
It is a very sensitive political issue in terms of Aboriginal kids. My two daughters are both Aboriginal. My view is that we need to start having these conversations because it can no longer be acceptable to leave kids in care for the rest of their lives because we do not want to address the difficult issues of how we place them if we do not have enough adoptive parents.
Senator L. Smith: Thirty-three thousand children are available to adopt. Two thousand are adopted in Canada yearly and two thousand are adopted by Canadians outside of our country. Of the 33,000, what percentage are Aboriginal children?
Ms. Eggertson: Very few are adopted.
Senator L. Smith: Like you said, you had 33,000 children.
Ms. Eggertson: We have roughly 30,000 who are eligible, legally free for adoption.
Senator L. Smith: What percentage of them would be Aboriginal?
Ms. Eggertson: We do not know. That is some of the data we would like. We do not even know that. We think many of those are legally free for adoption, but they are not being placed.
Senator L. Smith: How many areas do you focus on in your advertising? Is it just tobacco? Is that your number one focus of the Canadian Cancer Society?
Mr. Cunningham: We work on the whole range of issues from prevention through to palliative care. The educational efforts we make in awareness could include screening, indoor tanning, healthy living, and healthy eating and exercise. This bill has some provisions with respect to tobacco taxes so our testimony today is with respect it to tobacco taxes. Thirty per cent of cancer deaths are caused by tobacco. It is the number one cause of preventable cancer deaths. That is why it is important for us.
Senator L. Smith: Are there other factors besides tobacco that you would focus on? I am trying to get a sense of where your fight against tobacco falls in your overall program of key issues that you are trying to stand up against and get more support. Is tobacco the number one killer?
Mr. Cunningham: It is the number one cause of cancer deaths, yes, but again, we work on a full range of issues. In terms of prevention, people who have cancer, we are trying to increase survival rates. Research is very important with respect to that, as is access to treatment. People living with cancer in terms of our various programs are fundamentally important.
Senator L. Smith: What type of budget do you people work with?
Mr. Cunningham: We are the largest voluntary charity in Canada. Our annual budget exceeds $200 million Canada- wide.
Senator L. Smith: You are a big outfit.
Mr. Cunningham: We are.
Senator L. Smith: Mr. Pierce, could you give me some idea of your annual budget?
Mr. Pierce: Our annual national budget varies depending on the year, but we raise between $55 million and $60 million a year. Probably over 95 per cent of that is raised $20 to $100 at a time.
Senator L. Smith: If I understood correctly, you said the actual number of donors may have dropped but that the percentage has increased by about 3 per cent; is that correct?
Mr. Pierce: Yes.
Senator L. Smith: Is the indebtedness of Canadians and the rising household debt a problem for you in terms of raising money?
Mr. Pierce: It certainly is. As the economy declines, we can see an effect on donations. As the economy goes up, there is more optimism.
Senator L. Smith: Is that the number one problem you have or is it a demographic shift from an aging population?
Mr. Pierce: I think there are multiple factors. There is the economy; there is the aging population.
Senator L. Smith: What about cultural differences? In Quebec we learn that it is a new phenomenon for many francophones because there are francophone and anglophone people who have given for years but in some of the cultural communities it is a new experience, if you like, that people are trying to develop more of. Is the cultural issue with new immigrants and some of these folks part of it also?
Mr. Pierce: For new immigrants, if the disease affects the family, we can count on their support more so. We have to develop a culture of giving among young Canadians. Certainly, there would be a cultural aspect there.
Senator L. Smith: When you said that, the first reaction I had is when we hear the difficulty of young Canadians getting jobs today and being able to live with big indebtedness, with credit cards and lines of credit, I wonder if that is impacting them and, if that is the issue, how do you overcome that objection?
Mr. Pierce: There certainly is. Many young people are volunteering. That is their first foray into the world of philanthropy. I think that to encourage more young people to volunteer, to build experience on their resumé, will help them achieve their job sooner.
Senator L. Smith: How do you compete against the fellows who are trying to raise money for cancer? I am not trying to be mean-spirited, but you are in a competitive marketplace.
Mr. Pierce: Actually, we do not try to compete. Each of our causes is important enough to draw our own pool of support. When you look at the number of Canadians living with MS, the old estimate used to be between 55,000 and 75,000. There is a new study out now. It is not confirmed yet, but the numbers are probably much higher than that.
Senator L. Smith: Do you have a breakdown of the number of donors who are female, if women are the folks who have the highest percentage of this disease?
Mr. Pierce: Typically, the majority of our donations are family donations, so a husband and wife.
Senator Hervieux-Payette: Some universities are now giving credits to people for admission into certain faculties if they do volunteer work, especially in the faculty of medicine. This is a powerful thing. It is not just the grades that they get in school.
Mr. Pierce: That is how I got my first job. My two daughters, of course growing up with their dad working in the volunteer and non-profit sector, have volunteered since they were in grade 6. That helped with scholarships at university. It helps kids get a job.
Senator Wells: Mr. Cunningham, in my experience, businesses are very good at altering their practices to fit new rules, and you have given a perfect example there. We put a tax measure in place and they have used it to turn it into a promotional tool to increase their sales and to increase consumption. Looking ahead, do you foresee the tobacco companies doing something based on the legislative proposals that we have in place now?
Mr. Cunningham: I think your concern is legitimate, especially with the tobacco industry. They have a very long history of exploiting loopholes in terms of marketing practices, voluntary codes or targeting kids. There is a lot of money at stake. It underlines why we as Canadians and legislators have to be vigilant to respond quickly. If they were to exploit this gap further, with a different type of manufacturing practice, it is essential that the government be in a position to respond quickly with a further tax adjustment.
Senator Wells: Ms. Eggertson, can you talk about the 30,000 children available for adoption, or eligible for adoption — I am not sure what the right word is. What is the dynamic between the age of the child and the adoption rate? I do not want to use this term but it is the only one I can think of: Is there a non-beneficial cut-off, if you know what I mean? Where is it bad luck to be at what age?
Ms. Eggertson: If you are six, you are considered pretty old for adoption. That is the fact. Most kids in care are six and older. It is pretty easy to get babies adopted, even with challenging health issues. When you think about it, a six- year-old is not very old yet. I was pretty unusual adopting at eight and nine. A handful of kids in the province of Ontario have been adopted over the age of 10. The reason I use the age of 10 is because Ontario recently introduced its first provincial subsidy for children adopted over age 10, and there are very few.
Senator Wells: That was going to be my follow-up question. Given that there is what I will call a cut-off age, and given that we are talking about the budget, are there tax incentives that could be presented? I hate to put it down to dollars, but finances are an incentive for action.
Ms. Eggertson: We talked about a couple of things, and this is based on what happens in the United States. They have a special needs adoption tax credit in the United States, and ``special needs'' is defined quite broadly. It can mean older children who come from the foster care system. It is a refundable tax credit, so you do not have to submit all of your expenses and you get the maximum. That would be a big incentive for families.
Again, I have to stress that people do not adopt these kids to make money off this. As all parents know, it is a tremendous lifelong commitment. The majority of people who adopt in this country are not well-off. They are middle- income families. It is not that anyone will do this for the money, but the money would help in terms of offsetting expenses like counselling and all of those things. Tutoring is a big thing for a lot of parents because the students have changed schools a lot and need help to catch up. They may have learning disabilities, and so on.
A refundable tax credit, a special needs adoption tax credit, would be quite helpful, as would a post-adoption tax credit. Some states in the U.S. have a credit that families can claim every year if they have adopted from foster care. It may only be a thousand or two thousand dollars a year, but it adds up and is helpful in offsetting those expenses.
Senator Wells: For the record, I am shocked at the low budget you have and the amount of work that you do. You should be credited.
Ms. Eggertson: Thank you.
Senator McInnis: Many of my questions have been answered.
Mr. Cunningham, with respect to tobacco prices, I recall experiences that there is a threshold with respect to the cost. Governments are always anxious to gain revenue, so they were not reluctant to put taxes on products, particularly this product. However, the difficulty is that it entered the black market, which was quite a major issue here a number of years ago. I do not even know what one pays for a pack of cigarettes today and whether it is $20.
Mr. Cunningham: It depends on the province, the size of the package, and so on.
Senator McInnis: The point is that if 37,000 Canadians are dying from cancer as a consequence of smoking, obviously governments would want to eliminate that because of health costs. The difficulty — and I do not know where the threshold is — is that you have a major black market. The criminal element comes in here and tractor-trailer loads of cigarettes are moving across the border. Can you comment on that? It is a terrible dilemma that we find ourselves in.
Mr. Cunningham: You are right. It is essential that we have effective contraband measures in place. The good news is that even according to the tobacco industry contraband has dropped by half between 2008 and 2010, for a number of measures in terms of the location of border posts near Cornwall and of better provincial legislation. Some federal measures have contributed. Bill S-16 that has already been considered by your colleagues in the Standing Senate Committee on Legal and Constitutional Affairs has further enforcement measures that will help.
I wanted to note one thing of interest. I have provided this to the clerk, but I do not know if it has been distributed.
The Chair: No, it has not been yet, but it will be. It has to be translated. Go ahead.
Mr. Cunningham: This graph shows the comparable tobacco tax rates by province and territory. Ontario and Quebec have the highest contraband problem, but interestingly they have the lowest tobacco tax rates. In Western Canada, where there is very little contraband — and the tobacco industry admits that — tobacco rates are higher. The reason contraband is worse in Ontario and Quebec is not because of higher prices and taxes, because they have much lower taxes than in Western Canada and in some Atlantic provinces, but it is the proximity to illegal factories and the source of supply. That is not the case in Western Canada. Higher tax prices do not have to lead to higher contraband. Measures implemented in Western provinces demonstrate that, but the point you raise is important. We have to ensure we have effective contraband measures in place. We have recommendations in that regard and there is more governments can do.
Senator McInnis: Like what?
Mr. Cunningham: For example, dealing with illegal factories. The key is to block the supply of raw materials, the leaf tobacco and the cigarette papers that are going to these factors. If these factories do not have these raw material inputs, they cannot make cigarettes. That is a measure that the U.S. authorities have used with some success for a few illegal factories on the American side of Akwesasne, near the Canadian border. They blocked them, made the financial viability of these illegal factories much different and forced them to get a licence. That is a fundamental example.
Another example is that the Canadian government should be working with the American government much more actively to shut down the remaining illegal factories on the U.S. side of Akwesasne, very close to the Canadian border. Targeting the source — we know what the sources are and where they are — is essential and is key to making progress.
The Chair: Mr. Cunningham, we heard from Mr. Pierce that the super deduction for first-time donors is something that he supports. You raise a lot of money in donations. Is that something that you look upon as being helpful or will be helpful?
Mr. Cunningham: We rely on charitable donations from Canadians. Anything that facilitates and encourages additional charitable donations is something that we welcome and support. I am not able to discuss in the same level of detail that Mr. Pierce did with respect to this particular aspect of the bill, but fundamentally we have to welcome any help in this area.
The Chair: But have you no sense as to whether it will make a significant major impact?
Mr. Cunningham: I do not have any projections to provide in terms of forecast for additional donations to us.
The Chair: Thank you for your comments with respect to Senators Kenny and Nolin. You would be pleased to know they are continuing to serve in the Senate of Canada and are doing good work for Canadians. I hear regular positive comments about the work that they did with their tobacco non-smoking legislation 15 years ago now.
Ms. Eggertson, could you help me with the wording of the amendment itself? As I understand it, there is a window during which you could add up all of your expenses for adoption and then make a deduction and get 15 per cent of that. That window is expanding a bit at the front end, as I understand it.
Ms. Eggertson: That is correct.
The Chair: Nothing at the back end has changed in this legislation?
Ms. Eggertson: That is correct.
The Chair: We did have that discussion here. The wording is moving back to the time that an application is made for registration. Does that mean that if my wife and I wish to adopt a child, we register if we have not found someone?
Ms. Eggertson: It is largely for people who are adopting through the public system in Canada. If you want to do that you go to your local department — in some provinces it is your ministry of children and youth — that might be responsible for adoption. You go and you register with them and you start the process.
In Ontario you would go to your local Children's Aid Society. You register and say, ``I would like to adopt a child.'' Again, they look at your application. It is moving to that point, or it is when you contact a lawyer and begin the court process to adopt, if it is a private adoption. That is how they are going to calculate when you can start to claim the expense.
The Chair: And internationally?
Ms. Eggertson: Internationally it is probably not going to make a huge difference. The expenses are so much larger internationally already that people can already pile those expenses together to take advantage of the tax credit. Again, it is only 15 per cent of a total figure, up to $11,669 this year. If you have a $30,000 adoption, you have already got a lot of that money that you can put together in the year that you finalize your adoption. It was because it was for smaller figures, domestically, that you were not able to take advantage of it.
The Chair: That helps me understand a bit of this. So the date that you go and register is the beginning. Then would you go through all of the household tests.
Ms. Eggertson: You go through home study.
The Chair: All of that comes after?
Ms. Eggertson: Yes. You go through some training. It may take two or three years to actually have a child placed in your home.
The Chair: Ms. Eggertson, Mr. Pierce and Mr. Cunningham, thank you very much for being here. This is very helpful. We very much appreciate the work you are doing for Canadians.
(The committee continued in camera.)