Archive for April, 2010

Drug Policy in Ontario- A Cautionary Tale

April 24, 2010

As far as I know, Beatrix Potter never wrote a tale about a pharmacist, but if she were alive today there would be no shortage of material to work with based on the verbal missiles being exchanged over the distribution of prescription drugs in Ontario. This time the dispute pits retail pharmacies against the provincial government which means Ontario taxpayers. In previous rounds we witnessed the brand name companies confronting generic manufacturers, and small pharmacies their larger rivals like Shoppers Drug Mart, Zellers and Walmart.

The focus of the present clash is the higher price of many generic drugs in Ontario and Canada than in most other developed countries with the following examples provided by the Ontario Ministry of Health – the percentages show how much the average prices of four drugs are lower in five other developed countries than in Ontario.

Enalapril (blood pressure) 82% lower
Gabapentin (epilepsy) 35% lower
Metformin (diabetes) 31% lower
Ranitidine (gastrointestinal disorder) 69% lower

In order to address this differential the Ontario government proposes to abolish the 20% professional allowance payment made by drug manufacturers to pharmacists for stocking and dispensing their generic drugs, an amount which is claimed to be pocketed by pharmacists and not passed on to consumers. Other parts of the legislation propose offsetting part of the loss by pharmacists being able to charge for dispensing health advice and for pharmacies in rural areas to receive additional payments.

In order to understand the incentives and constraints affecting the players, it is useful to outline the business model and supply chain linking drug manufacture and distribution to us the patients. Healthcare and our costs by way of prices for prescription drugs and taxes will be affected by the outcome of this struggle. As Beatrix Potter describes how Jemima Puddleduck is saved by Kep the collie-dog from the foxy-whiskered gentleman who was leading her to a simmering stew pot, so we need to construct our own story to warn against misleading arguments and actions that could result in unpleasant endings. I leave the reader to decide which animal corresponds to each of the current protagonists.

There are four main activities to consider, production of the drug, distribution to the final consumer, the decision-making process of consumers including the advice they receive on what to purchase, and the money flow involving consumers, government, insurance companies, pharmacies and drug companies.

Unlike the purchase of apples where the consumer decides what type and how many to buy, chooses from a number of competing outlets, and pays for them out of his/her own pocket, prescription drugs involve a different process. Physicians prescribe on behalf of patients with payment made from some combination of direct payment, medical insurance plans and government funding out of tax revenues. The money flows back from consumers to pharmacies, wholesalers, manufacturers and those undertaking research and development. Each stage has an interest in increasing its net returns namely income less expenditures. Final consumers have only expenditures and are interested in reducing these, namely the price of prescribed drugs.

Drug Production

The central character in this tale is the prescription drug which is produced and distributed to end users, we the public as patients. The supply chain starts with the production of knowledge often in a laboratory owned by a private firm or as part of university facilities. The costs of developing and testing a new drug before it is approved for use are often extensive and time consuming. The accuracy of cost figures reported publicly is difficult to determine. Those who have an interest in showing high costs, such as the brand name companies, will highlight the drugs which were expensive to develop. Not all drugs have high development costs but many do. Tax breaks and subsidies may reduce the private outlay by companies. Those who pay for the drugs, individuals, hospitals, insurance companies and governments point to those brand name drugs which were cheaper to get to market.

An important aspect is patent protection. Brand name manufacturers argue for lengthening the duration of the patent and for protecting it against infringers at home and abroad. Consumers have an interest not in eliminating patent protection but in restricting its length. No one knows what the optimum patent length is, or exactly what would happen in the absence of some or all protection. Once the patent life is terminated, other firms, the generic manufacturers, enter as producers and using substantially the same formula produce the previously patented drug using a different name. There is also nothing to prevent the brand name manufacturers from producing a generic version of their previously patented drugs. In this respect the brand name manufacturers have an advantage in part because they can plan their promotional campaign based on their experience with distributing the patented product. An additional practice is for the brand name manufacturer to develop a new patented drug that is only slightly different from the original thereby hoping to extend the period of protection and ward off effective generic competition.


At a certain point in the life of a drug, a generic competitor comes along and competes with the original branded version. Competition increases and prices fall, but the extent of the decrease depends on the distribution system and how the drug reaches the consumer.

Typically drugs are distributed from the manufacturer to a wholesaler who then supplies retail pharmacists and institutions such as hospitals. In turn, the drugs are supplied to consumers who have only limited input regarding these purchases. Leaving aside hospitals where physicians choose what to prescribe and the only real choice for the patient is to accept or decline the medication, other consumers receive prescriptions from a doctor and take them to a pharmacist for fulfillment. The pharmacist decides which particular drug to dispense depending on the availability of generic drugs and how payment is made.

This is where it gets tricky because of the types of drugs, brand name and generic and the alternative payment mechanisms, consumer, private insurance and government or some combination of these three.

An example may help to clarify the main alternatives.
A patient receives a prescription from a doctor for:
1. A brand name drug for which there is no generic alternative
2. A brand name drug for which there are one or more generic alternatives
3. A generic drug for which there are one or more alternatives

Payment can be:
A. By the patient
B. By an insurance company in whole or in part with the patient paying the balance
C. By the government in whole or in part with the patient paying the balance or with the insurance company paying the balance, or some combination of the above.

At this point we need to move from the stages of drug distribution to the payment of monies, although it is difficult to separate the two.

Follow the money

Like Kep the collie who tracked Jemima to find out where the foxy whiskered gentleman had taken her, it is necessary to follow the money trail to find out who is getting what. The money for drugs comes from a combination of user payments, insurance company financed health plans which in turn have been paid for by consumer premiums, and by government with monies from tax revenues or borrowing. Regardless of the institutional arrangement, consumers/taxpayers are on the hook for the cost of prescription drugs.

When the current Ontario battle is described as one between the provincial government and retail pharmacies, it distracts from the fact that the public pays either out of pocket, or with premium financed insurance plans or out of tax revenues. The protagonists are really retail pharmacies and consumer/taxpayers with drug manufacturers, insurance companies and governments having a variety of interests and involvement in the outcome.

Over the course of a year my prescription drugs are paid for by a combination of cash, the Ontario government, and an insurance plan with Great-West Life. In each case I pay, with cash, with my taxes which help to fund the government portion and with my premiums to the insurance company. I have a direct interest in the final price of the prescription regardless of the source of the payment. Thus, when the price of generic drugs are higher in Ontario than in other jurisdictions, I and other consumers should be as concerned as when the prices of gas, food and clothing are higher.

Consider the above cases. In 1. where there is only a brand name drug, there are no choices for the pharmacist to make and the supplier can determine the price, unless the government decides that an alternative cheaper drug is satisfactory even if it is not a direct substitute. The patient may have the choice of the cheaper drug paid for by the government or insurance company or pay directly for the prescribed branded drug.

In cases 2. and 3. where there are generic substitutes, especially more than one substitute, a choice is made as to which drug to use to fill the prescription. Here the pharmacy has input into the transaction, since the pharmacist may not carry all the available generic substitutes and may carry only those drugs for which professional allowances are received. The allowance is an incentive. Some refer to it as a kick-back for the pharmacist to carry a particular drug but with no incentive to pass any or all of this benefit on to the consumer. It is similar in many but not all ways to a rebate given by an automobile company to a car dealer that is taken by the dealer and not handed on to car buyers.

One reason why car dealers would have difficulty in pocketing a rebate is because retail competition is much more intense for cars than for generic drugs. The nature of the two markets do differ, but it is not just this comparison that matters but the fact that prescription drug prices for generic drugs are substantially higher in Ontario than in the markets of other developed economies as outlined above.

Response from pharmacists

Pharmacists have organised a spirited rebuttal to the proposed legislation that I outline here. More detailed arguments are found on the website of the Ontario Pharmacists’ Association:
1. Pharmacy profits will be reduced to such an extent that some pharmacies will go out of business and others will be forced to reduce services such as opening or dispensing hours. Pharmacy staff will be reduced and less time will be given to customers regarding their prescriptions.
2. Pharmacies in rural areas will be forced out of business due to the loss of revenues from removal of the professional allowances.
3. Patients will suffer from the reduced pharmacy services.

Issues to consider in evaluating the opposing positions relate to the business model for pharmacists. Small specialized pharmacies exist alongside and compete with big stores like Walmart, Shoppers Drug Mart and Rexall. Pharmacies are either part of larger stores selling a wide range of goods that often have slim margins but allow money to be made on volume, while higher margins are earned on a lower volume of prescription drugs; or the stores specialize more in prescription drugs and health related products only and have a smaller turnover with higher margins for what they sell.

A large diversified store can afford to have its margins squeezed on the more profitable prescription drugs without being forced out of business. A small pharmacy more dependent on its prescription drug business will experience a relatively larger negative impact on its profitability, and may have to close down or restructure its operations so as to diversify its sources of revenues and profits.

In recognition of this, the Ontario legislation includes two other provisions, one to pay pharmacists for the health advice that they give clients and the other is to provide a higher prescription dispensing fee for pharmacies in rural areas that have lower turnover. How payment for advice will be structured is unclear at this stage but may require customers to make appointments for a consultation with the pharmacist. Issues may also arise regarding the liability associated with a pharmacist’s advice for which payment is made.

Another factor to consider is the extent of the alleged loss of service to consumers as patients if some pharmacies are forced to reorganize. This has to be looked at in the context of mail-order distribution of drugs where there is already reduced opportunity for dispensing advice but increased sources of retail supply.


Complexity can be added to the above discussion by describing the role of drug formularies, the catalogues that list available drugs and are used by the industry to determine those that can be dispensed under different conditions. The foregoing discussion tries to identify the main factors influencing the supply and pricing of prescription drugs in Ontario in order to assess the likely impact of changing policies.

The final costs of the measures introduced by the Ontario government are uncertain, until the principal players in the supply chain adjust their transactions to the new policies. The economic effects will be found in the prices to consumers, both direct payments and indirect payments in the form of insurance premiums and taxes, and in the type of service received.

The initial response of some pharmacies to reduce hours of service for dispensing drugs, and thereby limiting revenues seems to be masochistic behavior, but perhaps generates some non-pecuniary satisfaction especially when undertaken in the riding of the Minister of Health. It’s hard for consumers to be unsympathetic to a policy which is trying to reduce the prices of drugs that are substantially lower in other developed countries, facts that are not contested. Perhaps Beatrix Potter could construct a happy ending for this tale.


Hitler’s Empire by Mark Mazower

April 16, 2010

Hitler’s Empire – How the Nazis Ruled Europe by Mark Mazower, Penguin 2008.

The Guernsey Literary and Potato Peel Pie Society (2008, Dial Press) is a whimsical tale, told in the form of letters, about life under Nazi occupation in the Channel Islands during the second world war. The details and experiences of occupation, a major focus of Professor Mazower’s book Hitler’s Empire, are of interest to me. The book documents the occupation experience in Europe, especially eastern European countries extending into the Soviet Union. Living in southeast England during the war I have always wondered what occupation might have been like and who would have collaborated and who resisted the Nazis. What I learned from this book about the war in addition to the more familiar general historical treatment was as follows.

First, Hitler’s ambitions for Germany were developed in the context of the spheres of influence that he saw Britain had with its empire, especially India, the US had in North, Central and South America and the spreading Japanese influence and designs in Asia. Germany, he felt, had been left behind in this expansion of territorial influence by other governments. Hitler aimed to move eastwards to achieve living space for Germanic peoples in Poland and Russia as an occupier, and to install regimes in Western Europe that would not be a threat as France had been in the past. If he could also reinforce outlets to the south, so much the better.

These aims were influenced by racial considerations. Hitler’s dislike of the Jews was coupled with a distaste for Slavic people and other minority groups, such as people with disabilities, as well as for Bolshevism. He signed the Nazi-Soviet non-aggression pact of Sept 1939 as a tactic to allow him to concentrate first on the dissolution of Poland without having to fight the Bolsheviks at the same time.

Second, the death rate among civilians in Eastern Europe and the Soviet Union was extensive, not just due to armed conflict but to the forced movement of peoples such as the Poles to the east. Civilians were sometimes killed by their own governments and by the Germans and Russians if they were in the wrong place at the wrong time. There were examples of Croats, Serbs and Ukrainians collaborating with the Nazis to move or liquidate selected groups among their own populations. Collaboration also took place in Denmark, Norway, Holland, Belgium and France where nationals rounded up other nationals at the request of the Nazis. This would surely have happened if the UK had been occupied.

Third, there was no detailed planning for how the newly occupied territories would be administered. Neither the German army nor bureaucracy, which Hitler did not trust, was tasked with this responsibility and so it was left up to Hitler and Himmler, head of the Gestapo, an organization subject to no judicial oversight, to appoint persons for different regions. These tended to be various unpleasant characters who implemented reprisals and reigns of terror to subjugate the conquered civilians. Local government required the Nazis to use existing bureaucrats, and as has been documented for Vichy France they often acted energetically to do the Nazi’s bidding. Sabotage of German persons and installations in occupied lands was met by reprisals involving the massacre of whole communities and the destruction of villages.
Fourth, the Nazis treated most of the populations of Western Europe far better than those in the east. While members of the Wehrmacht, the regular German army, at the beginning of the war often refused to take part in the atrocities ordered by Hitler, by the end of the war, as times became more desperate, they too engaged in these acts.

Finally, on a more general level, the circumstances of Hitler’s empire reinforces for me – it may be obvious to others – the importance of geography, location and timing for the conduct and outcome of major political and economic events. I am curious about the evolution and consequences of the British Empire from 1500 to the present. The more I read, the more I realize there are other comparative cases to study not just the Roman, Ottoman and Hapsburg empires, but, for example, the way in which the Soviet Union administered an empire for 75 years and the way the US and China behave imperiously today.

Imperial circumstances vary between cases. Whereas the Nazi example constitutes a horror story, a working research hypothesis is that empires have a variety of effects, some good and some less good. At this time, my hunch, unsupported by data, is that the British Empire resulted in benefits that outweighed the costs. In the future I will try to evaluate available evidence. One difficulty is to agree on a counterfactual situation. What would have happened in the absence of imperial rule? Would parts of the world have remained tribal and primitive by today’s standards? Would they have developed on their own with or without external aid? Or would they have been colonized by some other power? The alternative possibilities are numerous but any evaluation includes some implied alternative.

Immigration Industry In Canada

April 8, 2010


The discourse on Canadian immigration policy often makes reference to an immigration industry. I use the term loosely here to refer to the various advocacy groups that have an incentive to express an interest in the process of immigration, or more accurately migration which involves the outward as well as the inward flow of persons from and to Canada.

The immigration dialogue includes a variety of topics. Some examine whether the level and type of immigration should be increased or decreased. Others focus on the process for those entering the country and their settlement once they have arrived. Still others address the impact of migration on the cultural makeup of the country, what changes are occurring and what the implications are for Canadians. The last attracts headlines concerning issues such as dress codes that should be permitted in public places, public recognition of religious holidays, what languages should be used in the courts and for public documents, whether public funding should be allocated for faith based schooling, and whether religious court systems should be used to settle family and other disputes.

Most Canadians have a view on these topics which can affect their daily lives. Some have been studied and reported on in public inquiries with persons and organizations advocating particular positions. In a single article it is not possible to survey all the advocacy groups that relate to the many aspects of immigration policy. Here I attempt to outline how the immigration process is administered, who the interested parties are, aside from the immigrants, and what advocacy groups exist to provide input to the process and how they are financed.

The following three sections address (1) the stages of the immigration process, (2) statistics on immigration stocks and flows, and (3) the organization and funding of the individuals and groups which provide input into immigration policy.

Stages of immigration

Information gathering
Application making and processing
Transportation to Canada
Settlement in Canada – housing, employment, schooling, language training, dealing with government etc.
Application for citizenship

This barebones description of the process starts with the prospective immigrant gaining information about the possibility of emigration to Canada. This comes from a combination of Canadian government and other publications, word of mouth information from friends and relatives who have already emigrated, as well as media reports. With current communications facilities there is no shortage of sources. A Google search of “Canada and Immigration” gets 26.5 million hits in 0.16 seconds.

The application process is usually undertaken in the emigrant’s home country with details available on CIC’s website. At this stage, the applicant may decide to employ the services of an immigration lawyer or consultant – more on this later. Other websites point to useful information in addition to that provided by both the federal and provincial governments. While the federal government has the responsibility for immigration policy, it works with the provinces where the new arrivals will locate. For example, the provinces can also nominate persons to apply as economic immigrants.

Once CIC approves the application, the emigrant has to arrange transportation for him or herself as well as for any family members. The last may also apply to come later. Those accepted as permanent residents can sponsor family members to join them at a later date.

On arrival in Canada the process of settlement includes arranging for housing, employment, language training, schooling, health and social services and all the needs of any person living in Canada, but with the immigrant often being unfamiliar with opportunities and procedures.
Some years later, the immigrant who enters as a permanent resident can apply for Canadian citizenship after completion of a written test.

Outlined above is the entry process for a legal immigrant to enter Canada which includes refugees and asylum seekers. In addition, there are a number of illegal immigrants who arrive each year and add to the stock of those already in the country. After describing the flow of legal immigrants, we will outline how the illegals enter the country.

The metrics of immigration

Immigration to Canada is part of a broader category of activities, namely the crossborder movement of persons. For example in 2008 about 30.5 million persons entered the Canada legally (and an unknown number of people illegally) divided roughly between 30 million tourists, 272 thousand temporary entrants as foreign students and temporary foreign workers, and 247 thousand as permanent residents divided as follows:
– 149,000 economic – skilled workers, provincial nominees and entrepreneurs/investors,
– 65,000 thousand family members of those who entered Canada in an earlier year, and
– 33 thousand as refugee or asylum claimants.

Unlike Australia and New Zealand, Canada has no reliable data on those who leave the country each year and their reasons for doing so. The figure of 30.5 million in 2008 is thus a gross as opposed to a net estimate (total immigrants less total emigrants) of those entering Canada.

In addition to the legal immigrants in 2008, there were illegal entrants who added to those already unlawfully present. Since illegals don’t advertise their presence the number in the country and entering the country in any particular year is based on estimates. One previous Canadian Minister of Immigration put the number at 500,000 present in the country in a given year, the result of past inflows and outflows. In contrast the number of illegals in the US is often put at 12 million. Relative to total population the US figure is 4% and for Canada 1.5%. The lower Canadian percentage may be an underestimate or result from Canada being a less attractive destination and due to the geographic proximity of the US to Mexico whence a large number of illegals originate.

The number of those known to be ordered deported from Canada in 2007 was 63,000 according to the Auditor General, 22,000 were in Citizenship and Immigration’s (CIC) working inventory and 41,000 of whom the department had lost track. The government introduced a proposal on March 30, 2010, to amend the existing asylum process. CIC notes:

“The proposed changes are important, because although there are many people who truly need Canada’s protection, many asylum claimants do not. Did you know that:
 in 2009, over 33,000 asylum claims were made, but only 42% of the claims finalized were accepted
 approximately 60,000 asylum claimants are currently waiting for a hearing
 decisions on asylum claims currently take an average of 19 months
 on average, it takes 4.5 years from the time an asylum claim is initially made until all the legal avenues have been exhausted and a failed asylum claimant is removed from Canada.”

Some illegals have avoided the deportation process by not being officially identified.

The different categories of migrants are important in understanding the advocacy process. For example those who enter as tourists, foreign students and temporary workers may overstay their visas or work permits and become illegals. Asylum seekers are automatically granted entry if they arrive at the Canadian border and make the request. Their application will be subsequently assessed but the ways of avoiding deportation are numerous and often result in asylum seekers remaining in the country. Temporary foreign students and workers can now apply to become permanent residents without first leaving the country and thus move from one category to another.

Advocacy interests

Some public policy areas are narrowly circumscribed such as quotas for dairy farmers where the producers and their associations lobby to maintain the policy while those affected by higher prices argue for their removal. So far, the farmers have won the day. The immigration process and associated policies are less easily circumscribed and identifying the incentives for lobbyists is more difficult.

Immigration has its own particular supply chain, as outlined in the previous sections, which impinges on a variety of interested parties. Here I list four levels and the associated types of advocacy.
1. At the macro level there are those arguing for more or less annual immigration flows, or for revamping the immigration and refugee/asylum process recognized by many to be in need of a major overhaul.
2. A second more micro aspect comprises the input of immigration lawyers and consultants who work and lobby on behalf of individual clients. They may also campaign for changes to immigration procedures.
3. A third dimension relates to the work of organizations that assist immigrants to settle in different parts of Canada. Since settlement occurs in provinces and cities, advocacy activities may take place at the provincial and municipal government levels but with funding from all three levels of government and elsewhere.
4. Finally the immigrant becomes a citizen and, if 18 or over, a voter at election time where s/he is courted by candidates running for office. Each person running for elected office has an incentive to seek votes and can become an advocate for immigrants.

The foregoing is one way of identifying the main interested parties in what is a complicated process with overlapping stages. Some will engage in advocacy at more than one level. For example, members of parliament may lobby on behalf of individual constituents but will also have a view on macro level immigration policy and the funding level for agencies that support the settlement process, especially those in their ridings. Below we expand on the actions and funding of each of the four stages.

Macro advocacy

In 2010, two of the issues influencing the current discussion of the annual intake of immigrants are first the current recession and the level of unemployment. Some argue that annual inflows should be reduced or further refined to reflect rising unemployment associated with current economic conditions, and note that in a time of large fiscal deficits new migrants cost more in terms of government services than they contribute in taxes. Opposing these views are those who point to the ageing Canadian population and the contribution which immigrants can make to the future workforce. Proposals include selecting immigrants with certain skills and permitting persons to enter Canada on a temporary rather than a permanent basis to address these issues.

Who advocates these changes? As well as individuals including academics, research organizations such as the C.D. Howe Institute, the Canadian Centre for Policy Alternatives and the Fraser Institute publish studies on immigration policy, as well as on citizenship and multiculturalism. Their work is financed by a combination of donations from individuals and foundations, sale of publications and research sponsored by the public and private sectors. While political parties develop their own policy positions, they may fund and the use the research services of institutes and universities. Macro immigration policy is also widely discussed in the media where advocates of opposing positions are interviewed. Advocacy at this level tries to influence government policy.

Other sources of information that feed into this process emanate from specialized websites here and abroad. In Canada, Immigration Watch Canada reports on all aspects of the immigration process. Websites in the UK include Migration Watch UK and in the US the Migration Policy Institute performs similar functions. There is no shortage of web sources that provide support for the many aspects of immigration policy.

Immigration lawyers and consultants

This group contains persons who make their living in whole or in part by selling their services to those seeking to immigrate to Canada. The quality of their advice varies enormously since there are low professional entry barriers both for lawyers once they have been called to the bar, and for those who self-identify as immigration consultants. Unfortunately the more complex the immigration entry process becomes, the more opportunities and incentives arise for advisors who may not have recognized qualifications.

Basic information about the requirements for different categories of migrants is available on the Citizenship and Immigration (CIC) website, but navigating through the process, especially for those who do not speak English or French, requires the assistance of lawyers and/or consultants. Each application tends to have its own particular dimensions. One of the easiest, if not the cheapest, ways to immigrate to Canada is to buy entry in one of the business categories.
CIC notes that “immigration representatives include:
• lawyers who are members in good standing of a Canadian provincial or territorial law society
• Immigration consultants who are members in good standing of the Canadian Society of Immigration Consultants, and
• notaries who are members in good standing of the Chambre des notaires du Québec.”

Lawyers specialising in Canadian immigration, refugee and citizenship services are listed using an internet search engine or the telephone yellow pages for individual locations. Ottawa lists 12 lawyers or law firms. Toronto, Montreal and Vancouver have many more. Some lawyers belong to the Canadian Chapter of the American Immigration Lawyers Association. A Canadian total is difficult to estimate but my impression is that there is no shortage of legal services, probably of varying quality, being offered for sale.

Who is a member of the Canadian Society of Immigration Consultants (CSIC) and what do these persons do? The CSIC website sets out the membership conditions which include being a Canadian citizen, permanent resident or status Indian plus admission testing and payment of annual fees – see Listed are about 1650 active members, 4 suspended and about 830 revoked members. Contact information is provided to reach active members.

These persons work mainly at the micro level advocating on behalf of the particular circumstances of their clients. They stand to gain from increased flows and more complex admission procedures that require their services. They are paid on a user-fee basis. There is no easy way to list all the industry members nation-wide. A starting point is the CIC website where the leading hits for a search of “immigration consultant” warns about the actions of “unscrupulous, dishonest and bogus immigration consultants and representatives.” Some consultants operate in the underground economy which is hard to monitor.


A third level of advocacy is associated with individuals and organizations that assist the new arrivals to settle in Canada – to find housing, employment, language training, education, access to social services and to get their qualifications certified or recognized in Canada. CIC has outsourced many of these activities to local, municipal and provincial organizations for which this and other federal departments provide some funding. Additional revenue comes from private and corporate donations and from the work of volunteers. Assessing the financial equivalent of volunteers’ contribution of time is difficult, but my impression is that it is considerable.

A Canada-wide listing of these organizations is not possible here, but some idea of who they are and what they do is gained by looking at data from Ontario, from Ottawa and from a list of grants made by CIC each year.

For Ontario, an umbrella organization is the Ontario Coalition of Agencies Serving Immigrants (OCASI);
“OCASI was formed in 1978 to act as a collective voice for immigrant-serving agencies and to coordinate response to shared needs and concerns. OCASI is a registered charity governed by a volunteer board of directors. Its membership is comprised of more than 200 community-based organizations in the province of Ontario.
OCASI member agencies provide community and social programs for immigrants and refugees in Ontario. Our member agencies provide a wide range of programs and services which help immigrants adapt to life in Ontario. Many agencies offer specialized programs for women, refugees, seniors and young people. These include:
• advocacy, community development and social action
• language and orientation classes
• individual, family and vocational counselling
• interpretation and translation
• information and referral
• job training
• legal assistance
• health services

For Ottawa, the Ottawa Community Immigrant Services Organization (OCISO) acts as an umbrella organization.

“Ottawa Community Immigrant Services Organization (OCISO) is a non-profit organization that has been assisting immigrants and refugees with settlement and integration issues since 1978. We are a multi-service agency with award-winning programs for students and schools, English language training, immigrant women, job seekers, victims of torture, families and communities.
Annually, more than 8,000 immigrants and refugees land in Ottawa to make it their home, with approximately 4,500 newcomer students in Ottawa’s schools. OCISO serves more than 25,000 immigrants and refugees every year. Our services help newcomers to help themselves by providing information, counseling, and support.

We rely on our donors and sponsors in addition to the funding we receive from various levels of government. We are grateful for our core funding, without it we would be unable to offer our wide-ranging programs. We are also grateful to our community donors and sponsors whose help makes these programs even better. To find out more about our core funding, click here.

Similar organizations and service providers are replicated across Canada more so in some locations, such as Toronto, Montreal and Vancouver, than others. All require financing which results in their applying to the funds available from different levels of government. Since demand exceeds the supply of funding, these organizations continually petition their sources and there is competition for the limited monies available. Rather than advocating about total levels of annual immigration, these organizations focus on the resources needed to fulfill their particular missions.

A further level of detail is made possible by examining CIC’s list of the recipients of grants and contributions over $25,000 to organizations and individuals with outlines of the purpose of the funding at
For the period October 1 – December 31, 2009, almost 200 grants and contributions were made to individuals and organizations across Canada, more than 60 of these were in excess of $1 million. The largest grant of $13 million was made to the South Asian Family Support Services of Toronto, and the second largest ($9 million) to the Settlement and Integration Services of Hamilton, Ontario, both for language training and settlement services. In fact because some organizations received more than one grant in this period, the number of organizations receiving more than $1 million is larger than noted above.

Nine Ottawa based recipients were awarded a total of $9.5 million in the fourth quarter of 2009. They are illustrative of the range of organizations and activities supported by the program:

Algonquin College – $3 million for language training
Carleton University – $50K for research on refugees
Catholic Immigration Centre – $1.9 million for its HOST program
Conseil économique et social d’Ottawa – $134K for volunteers
Groupe Anti-Délinquance en Poésie – $42K for juvenile delinquency
Immigration Women Services – $511K for settlement services
Jewish Family Services -$693K for anti-racism training
La Cité Collégiale – $1 million for language training
Ottawa Chinese Community Centre – $2.2 million for language training.

As noted, organizations may, in addition to government funding, be the beneficiaries of individual and corporate donations and volunteer services in kind. A visit to the Ontario Ministry of Citizenship and Immigration website will lead to numerous public and private sector programs that can be tapped for possible funding by immigrant related organizations – see Additional information is gained by visiting municipal websites.

In this mix, there are bound to be organizations with similar mandates, and it is doubtful that the present structure is the least cost way of delivering the required services. On the other hand it would probably be costly in political terms to attempt a rationalization the process, especially if it appears to offend particular interest groups.

Elected representatives

At the federal level, Canada is divided into 308 electoral ridings (with proposals in 2010 to increase the number to 338), as well as into provincial ridings and municipal electoral districts. Here the focus is on the federal scene for which Statistics Canada reports on the ethnic composition of the 308 ridings. This is one way of estimating the strength of political interest in immigrant issues.

Vancouver and Toronto are examples of places where ridings tend to have a high percentage of ethnic voters and PEI and Newfoundland are those at the low end. Statistics Canada, based on the 2006 Census, reports the percentage of total visible minorities by federal ridings. These include the following non-random examples – two ridings in each case:
BC 40% and 67%
Ontario (Ottawa) 20% and 31%
Ontario (Toronto) 53% and 41%
Newfoundland 0.5% and 0.7%
PEI 1.1% and 3.1%

Politicians and their parties consult these figures when planning electoral campaigns. A platform that appeals to a particular ethnic group or to immigrants as a whole can attract votes at election-time. At the riding level, one example is the sponsorship of a bill (Bill C-148 received first reading June 18, 2009) by two Liberal MPs, Ruby Dhalla and Bob Rae that would extend Old Age Security payments to immigrants after three years residence in Canada instead of the current ten years. Dhalla’s riding of Brampton Springdale contains a population with over 50% visible minorities; Rae’s riding of Toronto Centre has over 40%.

Because of the growing ethnic diversity of the population no political party in Canada much of an incentive to discuss immigration policy or to propose measures that might alienate the ethnic vote. This has resulted in the immigration and refugee/asylum process becoming dysfunctional as illustrated by the build-up of large backlogs of unprocessed applications, delays in deporting detainees and a growing number of illegal migrants in the country. Since 2008, the federal government has introduced legislation which attempts to remedy this situation.

Ethnicity by riding is one issue. The aggregation of particular ethnic groups across ridings creates diasporas in Canada which in turn have political implications. Recent immigrants understandably maintain contact with their country of origin aided by reduced transportation and communications costs. Diasporas of Indians and Pakistanis – Hindus, Sikhs and Muslims, Jews and Arabs, Tamils and Sinhalese, Serbs and Croats, and Protestant and Catholic Irish, express their conflicting views and lobby for Canadian foreign policy to reflect their viewpoints. A recent example is contained in the remarks by a retired Canadian diplomat that Canadian politicians pursue foreign policy goals in order to corner “the ethnic vote in Canada,” and that they formulate foreign policy on the Middle east so as to win votes at home (Ottawa Citizen, March 29, 2010, A1,A4).

Advocacy at the level of elected politicians is a function of the democratic process where candidates and their parties craft platforms that increase their chances of being elected. As ethnic voters become increasingly important overall and in particular ridings, platforms are developed with these, amongst other, voters in mind. Advocacy funding comes from both political parties and from organizations that represent the ethnic groups.

A further place for learning about current Canadian immigration issues is the parliamentary committee process where witnesses, often members of the immigration industry, appear to present their positions on policy proposals. Both the House of Commons and the Senate have a Standing Committee on Immigration. Here lobbyists interact directly with Senators and with elected representatives whose receptiveness is conditioned by the ethnic composition of their ridings.

Another avenue of advocacy is the media that serve ethnic communities. Little known to most English and French Canadians are the ethnic newspapers and broadcast media that serve these communities. According to,
Canada now has 14 full-service radio stations to provide programming for various ethnic groups, and more than 60 mainstream radio stations include ethnic programming in their schedules. Toronto’s CHIN, for example, broadcasts in over 30 languages.
In the field of print media, there are more than 250 ethnic newspapers, representing over 40 cultures, including 7 non-English dailies. Some publications, like the Chinese version of Maclean’s magazine, are distributed nationally.
Ethnic television is flourishing too. In 1979, the CRTC granted a license to CFMT-TV, Canada’s first multicultural television station. Based in Toronto, CFMT broadcasts programming in 22 languages throughout Ontario. Two similar stations have been licensed in Montreal and Vancouver. Five more ethnic specialty and pay-television services, and 44 digital specialty services, have also been licensed across the country.

The following points attempt to summarise the avenues for lobbying for the four stages discussed above and their funding sources.

1. Macro issues such as overall level and type of immigrants
Political parties, lobbyists, research institutes, individual researchers
Funding from interest groups, foundations, individuals
2. Individual immigrant applications
Private lawyers and consultants (official and other)
Funding on a user-fee basis
3. Settlement for newly arrived immigrants and refugees
Funding by CIC, various other departments and agencies at all three governmental levels, by corporate and private donations and by volunteers
4. Elected members and political parties
Constituency level issues that generate support for candidates.
Funding by political parties and ethnic based organizations

There is no clear distinction between the stages of the immigration supply chain which as depicted above does not, but should, extend to citizenship and the operation of multicultural policies that follow the fourth stage. Unlike the lobbying that takes place by farmers for dairy quotas where the subject matter is clear and opponents (consumers) poorly organized, immigration entails a messy process with overlapping stages and issue areas which allow various coalitions of interest groups to form around particular issues and then dissolve to reform around other issues.


I began this research by being curious about what was meant by the immigration industry in policy discussions. My understanding is that it refers loosely to those persons and organizations that have incentives to and are interested in advocating certain points of views about immigration, refugees and the multicultural dimensions of Canada. Because of the wide variety of related topics, it is difficult to draw a boundary around these lobbyists, to discover their incentives, to identify the funding sources and to quantify the amounts that each receives. By describing four stages to the immigration supply chain, it is possible, on a preliminary basis, to understand the roles of particular interest groups. My impression is that there is a considerable amount of public information available that would help to improve our knowledge of who we are and who we are becoming.

Immigration Industry in Canada

April 8, 2010