The All Party Co-operative Caucus continued its study of the co-operative sector on Wednesday, September 24. Mauril Bélanger, M.P. (Ottawa-Vanier) chaired the caucus, the fourth since being established in the spring. Mr. Bélanger opened the session by drawing attention to the amazing diversity of the co-op sector in Canada.
Twenty-seven MPs attended this Caucus, which was the highest attendance to date with good representation from the three main parties.
The guests invited to present on this occasion were Monique F. Leroux, President and CEO of Desjardins Group and Martha Durdin, President and CEO of Credit Union Central of Canada. Ms Durdin’s presentation offered an overview of the credit union sector in Canada and highlighted the stability of credit unions in the financial services market. Ms Durdin presented Credit Union Central’s proposed Capital Tax Credit to the Caucus with data that suggests supporting the policy would stimulate growth in the credit union sector. MPs were asked to discuss the proposal with their party caucuses as well as with finance Minster Joe Oliver.
Mme Leroux followed with some background on the history and success of Desjardins in Quebec and Canada and an overview of their current activities internationally. Mme Leroux made a point of highlighting the co-operative difference and remarked that profit is not the only objective of the Desjardins Group. Mme. Leroux indicated to the Caucus that she felt strongly about working together with all co-ops as well as government to grow the co-operative movement across Canada and the world.
Denyse Guy, Executive Director of CMC remarked, “the strong presentations initiated a great question and answer session that showed the interest we had hoped for. It’s good to see parliamentarians taking notice of the economic advantages of the co‑operative business model and leaving aside politics.”
The Parliamentarians wanted to know what caisse populaires and credit unions were doing to help small and rural communities with their economic development needs. Mme. Leroux responded that Desjardins is investing in technology to help connect rural and remote communities with the economic tools they need. Martha Durdin suggested that there is a regulatory burden on the credit union sector, however they are still trying to adapt to realize growth and to assist rural and remote communities. There are in fact 382 rural communities in Canada rely solely on credit unions for their financial services which indicates an important relationship with small or remote communities.
Caucus questions turned to the proposed Capital Tax Credit being requested, with an MP asking if Desjardins should not be included in the equation due to their size, and to focus the tax credit on helping “the little guy.”
Mme Leroux replied that Desjardins also has small players.. “Our policy point of view is that all credit unions and caisses need to be on a level playing field. Most regulations are designed to fit the corporate model,” she continued.
“Why a 5% Capital Tax Credit?” asked another MP, “where did that number come from?” to which Ms. Durdin responded that the gap between the corporate tax rate and the small business tax rate is roughly 5% as the rationale for the selected rate. Many credit unions are losing their small business status as they amalgamate to offer broader services to members.
The meeting was adjourned after final comments from the two guest speakers. Martha Durdin pointed out in her closing remarks that credit unions play a very important role and need a regulatory environment that will help them grow. With Monique Leroux adding that Co-ops can offer solutions that will help Canadians, the federal government needs to keep the co-op movement in mind when making decisions.
The next meeting of the All Party Co-operative Caucus is scheduled for October 22, 2014.