36th Parliament, 1st Session
EDITED HANSARD • NUMBER 153
CONTENTS
Tuesday, November 17, 1998
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ROUTINE PROCEEDINGS
|
1005
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | GOVERNMENT RESPONSE TO PETITIONS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Peter Adams |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | COMMITTEES OF THE HOUSE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Child Custody and Access
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Roger Gallaway |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Procedure and House Affairs
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Peter Adams |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | QUESTIONS ON THE ORDER PAPER
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Peter Adams |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | GOVERNMENT ORDERS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA SMALL BUSINESS FINANCING ACT
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Bill C-53. Report stage
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Speaker's Ruling
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | The Deputy Speaker |
1010
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motions in Amendment
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Francine Lalonde |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motion No. 1
|
1015
1020
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Walt Lastewka |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jim Pankiw |
1025
1030
1035
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Nelson Riis |
1040
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Antoine Dubé |
1045
1050
1055
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Dennis J. Mills |
1100
1105
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jim Gouk |
1110
1115
1120
1125
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gurmant Grewal |
1130
1135
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Hélène Alarie |
1140
1145
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Ted White |
1150
1155
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Paul Crête |
1200
1205
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Roy Bailey |
1210
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jean-Guy Chrétien |
1215
1220
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Keith Martin |
1225
1230
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Pierre de Savoye |
1235
1240
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jason Kenney |
1245
1250
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Suzanne Tremblay |
1255
1300
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Deepak Obhrai |
1305
1310
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Rob Anders |
1315
1320
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gary Lunn |
1325
1330
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Darrel Stinson |
1335
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Eric Lowther |
1340
1345
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Werner Schmidt |
1350
1355
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | STATEMENTS BY MEMBERS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | MIGRAINE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Tom Wappel |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HEADSTART PROGRAMS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Keith Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | GUELPH—WELLINGTON COMMUNITY RADIO
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Brenda Chamberlain |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | 1998 GOVERNOR GENERAL'S LITERARY AWARDS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Peter Adams |
1400
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA-FRANCE INTERPARLIAMENTARY ASSOCIATION
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Yvon Charbonneau |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | RAILWAYS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Dale Johnston |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HARRIS CANADA INC.
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Bernard Patry |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HUMAN RIGHTS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Shaughnessy Cohen |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HEALTH
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Chuck Strahl |
1405
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ELECTION CAMPAIGN IN QUEBEC
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Guy St-Julien |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | SHERBROOKE MUNICIPAL COUNCIL
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Serge Cardin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | SOCIAL RIGHTS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Libby Davies |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ELECTION CAMPAIGN IN QUEBEC
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Denis Paradis |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FINANCIAL INSTITUTIONS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Odina Desrochers |
1410
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FISHERIES
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Mark Muise |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | SIMCOE—GREY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Paul Bonwick |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | POVERTY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Diane Ablonczy |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | EDUCATION
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Andrew Telegdi |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | EDUCATION
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Nelson Riis |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ORAL QUESTION PERIOD
|
1415
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FINANCE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Preston Manning |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Preston Manning |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Preston Manning |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Miss Deborah Grey |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Harbance Singh Dhaliwal |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Miss Deborah Grey |
1420
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Harbance Singh Dhaliwal |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | BUDGET SURPLUS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gilles Duceppe |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gilles Duceppe |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Yvan Loubier |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Yvan Loubier |
1425
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | PAY EQUITY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Alexa McDonough |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Marcel Massé |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Alexa McDonough |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Marcel Massé |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | AGRICULTURE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Rick Borotsik |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Lyle Vanclief |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Rick Borotsik |
1430
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Lyle Vanclief |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FINANCE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Monte Solberg |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Monte Solberg |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HAZARDOUS TOYS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Pauline Picard |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Pauline Picard |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FINANCE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Williams |
1435
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Williams |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | BILL C-54
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Francine Lalonde |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. John Manley |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Francine Lalonde |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. John Manley |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HEALTH
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Grant Hill |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
1440
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Grant Hill |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ICEBREAKING POLICY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Yves Rocheleau |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. David Anderson |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | PUBLISHING INDUSTRY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Sarmite Bulte |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Sheila Copps |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | FORESTRY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Duncan |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Bob Speller |
1445
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Duncan |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Ralph E. Goodale |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | HAZARDOUS PRODUCTS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Judy Wasylycia-Leis |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Judy Wasylycia-Leis |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Allan Rock |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | TAXATION
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Scott Brison |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
1450
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Scott Brison |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADIAN WHEAT BOARD
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Murray Calder |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Ralph E. Goodale |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA PORT AUTHORITIES
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Lee Morrison |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. David M. Collenette |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ICEBREAKING POLICY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. David Anderson |
1455
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | UNEMPLOYMENT INSURANCE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Pat Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Paul Martin |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA POST
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gilles Bernier |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Alfonso Gagliano |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | UNEMPLOYMENT INSURANCE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. George Proud |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Pierre S. Pettigrew |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | TAXATION
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Nunziata |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Harbance Singh Dhaliwal |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADIAN FARMERS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Howard Hilstrom |
1500
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Lyle Vanclief |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | PRESENCE IN GALLERY
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | The Speaker |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | GOVERNMENT ORDERS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA SMALL BUSINESS FINANCING ACT
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Bill C-53. Report stage
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Grant McNally |
1505
1510
1515
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Jocelyne Girard-Bujold |
1520
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Howard Hilstrom |
1525
1530
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jake E. Hoeppner |
1535
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Cummins |
1540
1545
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Grant Hill |
1550
1555
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Diane Ablonczy |
1600
1605
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Rahim Jaffer |
1610
1615
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Division on Motion No. 1 deferred
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motions Nos. 2 and 3
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jim Pankiw |
1620
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motions Nos. 4 and 5
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Hon. Alfonso Gagliano |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Deepak Obhrai |
1625
1630
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Gurmant Grewal |
1635
1640
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Walt Lastewka |
1645
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Werner Schmidt |
1650
1655
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Francine Lalonde |
1700
1705
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Jim Gouk |
1710
1715
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Ted White |
1720
1725
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Keith Martin |
1730
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CRIMINAL CODE
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Bill C-51. Third reading
|
1800
(Division 263)
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motion agreed to
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | PRIVATE MEMBERS' BUSINESS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADA STUDENT LOANS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motion
|
1810
(Division 264)
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Motion negatived
|
1815
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | CANADIAN HUMAN RIGHTS ACT
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Bill S-11. Second reading
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Diane St-Jacques |
1820
1825
1830
1835
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Lynn Myers |
1840
1845
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Diane Ablonczy |
1850
1855
1900
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mrs. Madeleine Dalphond-Guiral |
1905
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Libby Davies |
1910
1915
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | ADJOURNMENT PROCEEDINGS
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Agriculture
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. John Solomon |
1920
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Joe McGuire |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Aircraft Safety
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Bill Casey |
1925
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Stan Dromisky |
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Scrapie
|
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Ms. Hélène Alarie |
1930
![V](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/b_stone1.gif) | Mr. Joe McGuire |
(Official Version)
EDITED HANSARD • NUMBER 153
![](/web/20061116180405im_/http://www2.parl.gc.ca/common/images/crest2.gif)
HOUSE OF COMMONS
Tuesday, November 17, 1998
The House met at 10 a.m.
Prayers
ROUTINE PROCEEDINGS
1005
[Translation]
GOVERNMENT RESPONSE TO PETITIONS
Mr. Peter Adams (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, pursuant
to Standing Order 36(8), I have the honour to table, in both
official languages, the government's response to 20 petitions.
* * *
[English]
COMMITTEES OF THE HOUSE
CHILD CUSTODY AND ACCESS
Mr. Roger Gallaway (Sarnia—Lambton, Lib.): Mr. Speaker,
I have the honour to present, in both official languages, the
first report of the Special Joint Committee on Child Custody and
Access.
The committee is requesting an additional two weeks' time to
complete its final report.
PROCEDURE AND HOUSE AFFAIRS
Mr. Peter Adams (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I
have the honour to present the 44th report of the Standing
Committee on Procedure and House Affairs regarding the selection
of votable items in accordance with Standing Order 92.
This report is deemed adopted on presentation.
* * *
[Translation]
QUESTIONS ON THE ORDER PAPER
Mr. Peter Adams (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I
suggest that all questions be allowed to stand.
The Deputy Speaker: Is this agreed?
Some hon. members: Agreed.
GOVERNMENT ORDERS
[Translation]
CANADA SMALL BUSINESS FINANCING ACT
The House proceeded to the consideration of Bill C-53, an act to
increase the availability of financing for the establishment,
expansion, modernization and improvement of small businesses, as
reported (with amendment) from the committee.
SPEAKER'S RULING
The Deputy Speaker: There are 16 motions in amendment
standing on the Notice Paper for the report stage of Bill C-53,
an act to increase the availability of financing for the
establishment, expansion, modernization and improvement of small
businesses.
Motion No. 1 will be debated and voted on separately.
[English]
Motions Nos. 2 to 5 will be grouped for debate and voted on as
follows. A vote on Motion No. 4 applies to Motion No. 5. Motions
Nos. 2 and 3 will be voted on separately.
Motions Nos. 6 and 11 will be grouped for debate and voted on as
follows. Motions Nos. 6 and 11 will be voted on separately.
[Translation]
Motions Nos. 7 and 8 will be grouped for debate and voted on as
follows: an affirmative vote on Motion No. 7 obviates the
necessity of the question being put on Motion No. 8, and a
negative vote on Motion No. 7 requires a question being put on
Motion No. 8.
[English]
Motions Nos. 9 and 10 will be grouped for debate and voted on as
follows. A vote on Motion No. 9 applies to Motion No. 10.
Motion No. 12 will be debated and voted on separately.
[Translation]
Motions Nos. 13 to 16 will be grouped for debate and voted on as
follows: an affirmative vote on Motion No. 15 obviates the
necessity of the question being put on Motion No. 16, and a
negative vote on Motion No. 15 requires a question being put on
Motion No. 16. Motions Nos. 13 and 14 will be voted on
separately.
I shall now put Motion No. 1 to the House.
1010
MOTIONS IN AMENDMENT
Mrs. Francine Lalonde (Mercier, BQ) moved:
That Bill C-53 be amended by adding after line 22 on page 2 the
following new clause:
“2.1 The purpose of this Act is to increase the
availability of financing of small businesses, which would not
otherwise have access to financing.”
She said: Mr. Speaker, I would point out that the Bloc Quebecois
voted for the principle of the bill.
We thought it would reform the situation so SMBs would have more
ready access to the government guaranteed capital they need but
would not otherwise have access to under the usual credit
requirements. That was our understanding.
This in fact is what the minister said initially when he
introduced the bill.
Oddly enough, this bill, entitled an act to increase the
availability of financing for the establishment, expansion,
modernization and improvement of small businesses, contains no
provision stating that this is indeed the intent of the bill.
Given this obvious discrepancy, the Bloc Quebecois decided to
propose an amendment indicating clearly the purpose of the bill.
The Canadian Federation of Independent Business, the main voice
of small and medium size businesses needing financing, repeated
to us that the bill should make it easier for small and medium
size business to obtain funding. The president of the Canadian
federation stated at a press conference a few months ago that
29% of businesses reported having great difficulty obtaining
credit.
Very small businesses and new businesses have the hardest time
getting this financing.
A number of Bloc Quebecois members conducted a survey among
small and medium size businesses. Out of the more than 800 small
businesses that replied to these seven members, 89% said it is
difficult or very difficult to get financing. Yet, the Canadian
Federation of Independent Business feels that, because of the
greater competition generated by the active presence of the
caisses Desjardins, the level of satisfaction in Quebec is high.
This means that accessibility is the main problem. Given that
the act is entitled “an act to increase the availability”, it
must provide, in its body and not only in the regulations, that
such is its purpose.
We are in no way saying that lenders should not be serious, on
the contrary. But all of us here know that it is always easier
to lend to a well established business whose profitability has
been recognized for years, than to entrepreneurs who are just
starting up, who have put all the winning conditions on their
side, but who have to prove that theirs will be a profitable
venture.
1015
Therefore, we hope all members will support this provision.
Otherwise, given that a whole part of the act will now be
included in the regulations and thus come under the exclusive
authority of the minister, there is a risk that not only will
the act fail to increase availability of financing, but that it
will in fact reduce such availability. I am convinced that no
one here wants that to happen.
We know that small and medium size businesses create jobs. We
will go back to the need to look at this capability, which has
been recognized by everyone. But if these businesses are to
continue to create jobs, they must have access to the credit
they need.
It is not normal to have so many small and medium size
businesses find such access either very difficult or difficult.
However, we can understand why when we look at the sectors in
which they operate.
There are some sectors where it is easier. A new optometrist
setting up a business is likely to obtain credit fairly readily.
It can, however, be very hard for a small business involved in
the production sector or high risk sectors such as new
technologies.
Government loan guarantees ought not to apply only to loans to
businesses that would have obtained them anyway. Nor should
they lead banks to assume bad risks. That is not what we are
saying. However, we are saying that, given appropriate careful
consideration, small and medium size businesses must have access
to credit.
According to some people, things are getting easier. Credit is
even available on the Internet from a certain bank. But it must
be pointed out that ING bank, the one referred to, charges a far
higher rate of interest and, according to what we have been
told, loans only to businesses with proven profitability.
What I am trying to say here is that this bill is indispensable,
because some businesses would not otherwise have the necessary
credit to develop, to create jobs, to continue in operation, and
sometimes to grow significantly. We support this bill because
we are aware of how important it is, but its purpose must be
clear. That is what the Canadian Federation of Independent
Business has told us on numerous occasions.
I do not want to call on people's sympathy, but we need to know
just how risky it is for an entrepreneur to launch a business.
In French we say “launch themselves”. I am not sure how that
comes across in translation, but there is a reason for saying
“launch themselves”. It shows the big chance the entrepreneur
is taking. He puts all of his energy into it, often investing
everything he, his family and friends have been able to
accumulate with great difficulty.
It is therefore important, when he has done everything possible
for himself, for him to be able to have access to a guarantee so
that he may obtain a loan that would otherwise not be available
to him. I therefore invite my colleagues to support this
amendment.
1020
I repeat, 80% of the small businesses surveyed by us say that
this guarantee must apply to businesses that would not otherwise
have access to financing.
I hope, speaking for small and medium size businesses, that this
House will agree to having the content of the title reflected in
the bill itself.
[English]
Mr. Walt Lastewka (Parliamentary Secretary to Minister of
Industry, Lib.): Mr. Speaker, it is a pleasure for me to have
the opportunity to speak to this motion.
During debate of this bill in committee a lot of the discussion
centred around the same thoughts as put forward by this motion.
The motion says very clearly that the burden of proof will now be
on small businesses to prove that they have gone elsewhere and
were totally rejected. From my understanding, only those who
have been totally rejected will then be able to apply under the
program.
At the present time we have an incremental amount of about 56%.
This was talked about in the report and in the auditor general's
report.
The wording of the proposed amendment would create a program of
100% incrementality. I know we continue to move in that
direction. There is always a desire that the Canada Small
Business Financing Act be applied to small businesses in high
risk areas in order to start new types of businesses and expand
small businesses. I have a concern about this motion making it
100%.
The auditor general on numerous occasions has expressed the fact
that the more the program is opened up and the more we insist on
incrementality, the greater the losses are going to be. A balance
is required to be struck when we have a program like the Canada
Small Business Financing Act and the intention of the government
to have a full cost recovery over time. The proposed amendment
would limit the goal of achieving cost recovery over the 10 year
life of loans under the program established in 1995.
Industry Canada will continue to monitor the incrementality and
the cost recovery through independent studies to ensure that
these two elements remain in balance.
I know the members of the standing committee who have debated
this bill very thoroughly are very concerned about having proper
statistics and data on an ongoing basis. Although the bill
insists on a review every five years, the Standing Committee on
Industry will be bringing this up on an annual basis in order to
make sure we have good reports and understand what needs to be
done.
Approving Motion No. 1 which would force 100% incrementality
starting with this bill next April would not be fair to the small
businesses across Canada that continue to seek small business
loans because of their high risk factor. We want to protect the
new small businesses coming on stream and those that want to
expand.
I would suggest that my colleagues not support Motion No. 1.
Mr. Jim Pankiw (Saskatoon—Humboldt, Ref.): Mr. Speaker,
the official opposition is opposed to this motion but for reasons
somewhat different than those of my hon. colleague from the
Liberal Party.
1025
Essentially the motion states that the purpose of the act is to
increase the availability of financing to small business. That
is a noble thing and something certainly we in the Reform Party
would all like to see because we favour any measures that would
assist small businesses.
The point is that this entire approach, an act, a government
band-aid solution to a problem, is not the answer. Businesses
have a problem in financing their enterprises right now, but the
reason is not because of a lack of a government program or an
inadequate government program. The reason is much deeper and more
far reaching than that. It is because of government
mismanagement of the entire economy in general, but specifically
because of the high taxes individuals and businesses are
subjected to.
For example, the employment insurance premiums are fully
one-third over and above the break-even point of the EI fund. That
places a great burden on businesses. The average Canadian worker
pays $350 a year over and above the break-even point of the EI
fund. The average employer pays $500. Per employee, per working
Canadian, that is $850 over and above the break-even point of the
EI fund. What does the government do with that money? It spends
it on programs, useless, meaningless programs, I might add,
grants and giveaways to special interest groups, subsidizing
things like VIA Rail, CBC and on and on.
Mr. Dennis J. Mills: What is wrong with that?
Mr. Jim Pankiw: Mr. Speaker, I was just asked what is
wrong with that. I would like to explain what is wrong with
that.
In September a constituent of mine called me and said “I work a
9 to 5 job. I make $30,000 a year. I have a wife and three
kids. The fellow who lives down the street from me is on welfare
and makes more money than I do. Explain that to me”. I said
that first I would have to verify this and told him to send me
his tax returns. I verified his income and his monthly take home
pay after taxes. I checked with social services in Saskatchewan
as to what an individual in the same circumstances would be
making.
My constituent was not quite right. He is $220 a month better
off than if he were living on welfare. But he has to drive to
work every day. He has to put gas in his car. He has to
maintain his car. Not only that, on social services a person has
full medical benefits which are not available to ordinary working
Canadians.
That is the point. This country's tax system is so repressive
that people do not have a reason to go to work. They are better
off to sit at home on welfare. It amazes me that the Liberals can
sit over there and somehow justify that or think it is okay. Not
only does the excessive taxation result in a situation where
people do not even have the incentive to go to work any more, but
it is affecting businesses.
I used the employment insurance fund as an example. Fully $5
billion a year is taken over and above the break-even point of the
EI fund and dumped into government spending programs. That is
what is wrong with those spending programs. The gentleman asked
what was wrong with financing CBC and VIA Rail. In a utopian
perfect world it would be great if we could finance a railway and
have a wonderful state-run broadcaster. But in the reality of
today's world, in the reality of the extremely high taxes that it
takes to fund those types of things, the consequence is that we
have tax system so repressive that people are better off to sit
at home on welfare than they are to go to work.
That is what is wrong with those programs. That is what is
wrong with a government that spends far too much money and
involves itself in far too many programs in areas where it has no
business being.
1030
I get back to the small business financing act. If the Liberals
would just downsize government, get their little fingers out of
every program they want to devise and spend our tax dollars on,
and cut taxes, we would not need a government program to cover up
or try to be a solution for the problem created by their high tax
regime. That is so simple yet they do not understand it.
The Reform Party would drastically downsize government. At the
same time we would focus spending on areas that matter like
health care and education. We would increase funding to those
areas. We would substantially cut government spending so
Canadians would pay less tax and would have reason to go to work
because they would have a lot more take home pay. They would be
able to finance their business enterprises much more effectively.
The problem is not access to more debt. This program purports
to assist businesses in putting themselves further in debt. The
problem is access to their own equity. The government is taking
all the profit in the form of taxes. That is the problem.
The answer is not a government program that provides a taxpayer
backed guarantee to businesses that cannot gain financing. The
answer is to cut EI premiums to the break even point. The answer
is to cut the size of government and to lower income taxes and
capital gains taxes so there will be venture capital and
businesses will have more equity. In turn they would have no
problem financing their business ventures.
There is a fundamental principle that Liberals do not
understand. A dollar left in the hands of an entrepreneur, a
consumer, an investor or an ordinary Canadian citizen is far more
productive than that same dollar being taxed out of their pockets
and sent off to Ottawa to be administered by a bureaucrat, a
lobbyist or a politician. That is a very simple fact but the
Liberal government does not get it.
Maybe I do not give the Liberals enough credit; maybe they do
get it. They are so wrapped up in their world in Ottawa, in
their bureaucracy, in the big leviathan they have created that
they have lost touch with reality. They do not address the true
problems.
If that were not true, how could they possibly be contemplating
raiding the employment insurance fund? That fund was paid into
by workers and employers for the insurance of employment, but the
Liberals cannot resist getting their greedy little hands on that
money and diverting it to places where it does not belong and
violates the law of the employment insurance fund. In order to
do that they will have to change the law, and they will.
Canadians need to oppose that. Every working Canadian and every
employer in Canada must understand they are being ripped off,
that it is unfair and that it is harming them. It is harming the
economy and it is harming business.
The motion is noble in the sense that it states the purpose of
the act is to increase the availability of financing to small
businesses. I agree with and support that statement, but the way
to do it is not through yet another government program. The way
is to get government out of people's lives, to downsize
government and to cut taxes so businesses can truly have access
to more of their equity and therefore to more financing. The
answer is simple. I implore the Liberal government for once to
open its eyes to that fact and to do what is right.
1035
Mr. Nelson Riis (Kamloops, Thompson and Highland Valleys,
NDP): Mr. Speaker, it is amazing what Ottawa does to people.
My friend from Saskatoon—Humboldt talked about the Liberals
never leaving Ottawa or being captivated by Ottawa. I do not
mean this in any personal way to my friend from
Saskatoon-Humboldt, but members of the Reform Party came out
yesterday with the comments that they have decided to support the
bank mergers. I wonder who on earth they would have spoken to in
the country to come up with this conclusion.
An hon. member: Where did you read that?
Mr. Nelson Riis: That is what I heard, that members of
the Reform Party said they would like to have some more
competition in banking.
An hon. member: That is the point. We need more
competition.
Mr. Nelson Riis: However the competition is not coming
so in the meantime it should be no to bank mergers. Talk about
somebody being seduced by Ottawa, being captivated and overcome,
or being Ottawa-ized. It is something like being customized or
whatever.
Something else puzzles me. My friend from the Reform Party says
if we had the perfect world, as the Reform Party would describe
it, we would not need this legislation. We do not have the
perfect world and we probably will not have the perfect world by
the end of the week, by the end of the year or even next year. My
friends from the Reform Party would have to agree that their
perfect world will not happen soon, but in the meantime should we
do absolutely nothing to help the small business sector?
An hon. member: Absolutely. Reduce taxes.
Mr. Nelson Riis: My friend is saying that we should do
absolute nothing. The point is they are not the government but
they say we should have a perfect world. Soon my friends in the
Reform Party will say we do not have the perfect world but we
should do away with pensions. In a perfect world we probably
would not need pensions or a medicare system. We do not have a
perfect world and that is why we have governments.
What does the legislation do? Is it new legislation? No, it is
not. The legislation has been around for a long time. Some time
ago somebody acknowledged the fact that a lot of creative small
businesses, real entrepreneurs, people with good creative ideas
could not get financing from traditional lending institutions.
The banks would not listen to them. The banks could not care
less about a young person with a great idea. The banks or
financial institutions could not care less about a new
entrepreneur who arrives with creativity and energy but could not
get financing because he did not have the capital to put up for
security or because he was too creative. The government of the
day had to come up with something.
It asked what it could do to encourage financial institutions to
support people who create things, lead the way, are on the
cutting edge and build the country. What could it do? The banks
were not being helpful.
The government introduced the Small Business Loans Act.
Basically the legislation said that if one had difficulty
accessing financing from traditional lending institutions the
government would provide support in terms of a guarantee. If the
bank felt that a group in its judgment was too risky, we would
share in the risk, society and the bankers or society and the
lending institutions.
We have talked to small business representatives, individuals
and the Canadian Federation of Independent Business. We have
asked what they think about the program. They say their members
like it. I recognize they only speak for 90,000 small business
people.
A small business organization from Halifax to Inuvik to Victoria
could not be found that would not say it liked the program. Most
federal government programs are bogus when it comes to helping
small business. I am prepared to say that most programs are
fluff. Most programs sound good but do not work. There are two
or three that work well and this is one of them. That is why I
cannot understand my friends in the Reform Party saying they do
not support it. It is a mystery how they can say that.
It is fair country. It is a free country. They can support
what they want but it mystifies me. I ask the next Reform
speaker to explain in some detail why they do not support it.
I realize that they say if we had a perfect world we would not
need it. We do not have a perfect world. We will probably not
have a perfect world for another few weeks or months or years or
decades.
1040
An hon. member: Two and a half years. After the next
election, with the Reform Party.
Mr. Nelson Riis: My friend from Saskatoon—Humboldt is in
the wrong profession. He belongs at Yuk Yuk's on Friday and
Saturday nights. He is a stand-up comic. He said the Reform
Party would form the government in the next election. This is
the ultimate form of hilarity and comedy. He is a great speaker,
but he is in the wrong place. He will have great audiences at
Yuk Yuk's.
New Democrats will support the amendment. It goes to the crux
of what the legislation is all about. The legislation is about
helping small businesses but not any small business. If a well
established small business that has been doing well for a number
of years wants to expand into a new area, getting support from
the financial sector is not a problem.
My friend from Regina—Lumsden—Lake Centre has been a small
business operator. He has been liaising with the small business
community from coast to coast for many years. He would concur
with what I say. For many small businesses accessing capital is
not a problem. For others it is a problem, particularly the
sector we want to see expand and build. I am referring to new
businesses, young businesses that reflect the emerging new
economy of the country. They are often a little short of hard
assets and have difficulty accessing funding.
The amendment acknowledges that group. It acknowledges people
who would otherwise have difficulty accessing financing. I am
not referring to small business individuals who can easily access
financing. They do not need help. It is the ones who have
difficulty accessing funding.
This is where I differ from the parliamentary secretary. Why
not make the legislation exclusive and have it available only for
small businesses that cannot get funding elsewhere and help them
particularly? All of those that would normally get bank loans
anyway do not need the help. They could probably get loans at a
lower rate.
Why not make the legislation available only for business
entrepreneurs, business investors and creative people who simply
cannot find financing through traditional agencies? We as a
society want to see these folks expand and grow and to see our
economy grow. When the economy grows, jobs grow, the economy
prospers, the tax flows in and the country gets to be a better
place. That is what it is all about. That is what the
legislation is all about. That is why the amendment makes a lot
of sense to me. The auditor general has reminded us from time to
time that was the problem and the amendment acknowledges it
I beg my friends in the Reform Party to change their position on
the legislation. To my knowledge the Bloc Quebecois supports it.
I think the Conservatives support it. Presumably the government
supports it because it is behind the initiative. We in the New
Democratic Party support it. We need to send a signal to small
businesses and say that we are behind them. We want to
particularly help small businesses that cannot access financing
from traditional sources.
I ask my Reform friends to get behind parliament and join with
us to say that the small business sector is where the action is.
The small business sector is where the jobs are being created. We
are behind small businesses 100%. We want to support them. We
want to encourage them. We want to nurture them. That is why we
should all be supporting the legislation with enthusiasm.
[Translation]
Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ): Mr. Speaker,
I am pleased to address Bill C-53, an act to increase the
availability of financing for the establishment, expansion,
modernization and improvement of small businesses.
1045
Government members should support the amendment proposed by the
hon. member for Mercier, since the title of the bill itself
states that its purpose is to increase the availability of
financing of small businesses.
The hon. member for Mercier proposes that this financing program
apply to businesses that would not otherwise have access to such
financing. This would allow increased financing to businesses
that are in trouble. I do not understand why the Reformers seem
to disagree with this amendment. They said repeatedly in this
House that the act should apply only to businesses that would
not otherwise have access to financing. This is precisely what
the hon. member for Mercier is proposing in her motion.
Businesses that have access to the financial and banking
institutions' regular program do not need this legislation to
get financing. In fact, it would not be to their advantage to
use this program, since the interest rate charged to businesses
is 3% higher. Therefore, it seems that businesses should use the
other types of loans offered by banking institutions. As a rule,
the government should not take the place of banking institutions
that play a role in the economy.
Reformers who support that view should realize that the banks
would only be too happy if this were the case.
For once we agree, to some extent, that we should leave it to
banks and financial institutions to deal with regular loans, as
they do a fine job of it. In my mind, banks include the caisses
populaires, because half of the loans made in Quebec went
through the caisses populaires.
I will let the Reform Party clarify their position. However, as
far as I am concerned, they are contradicting themselves. They
seem bent on an ideology where government should completely
withdraw so that individuals have so few taxes to pay, if
any—not no taxes whatsoever, as government would disappear—or
play such a diluted role that its presence would be
insignificant.
Not surprisingly the NDP believes that government should take
action in a number of areas, including small business. In Canada,
98% of all businesses are small businesses with fewer than 100
employees—and the percentage may even be higher because the
statistics are not necessarily up to date—yet they account for
45% of all job creation.
There is much talk about large corporations. That is fine, but
large corporations do not need such a program. They have access
to other financing sources. This program is suited to the small
and medium size businesses that lost significantly fewer jobs
than larger ones did during the recession, in the early 1990s,
and created a significantly larger number of jobs in the
following recovery.
Small businesses ought to be encouraged, on account of the
various sectors they are involved in within the global economy.
I am thinking of the agri-food industry, for example, including
fisheries and forestry; in Quebec, 90.1 % of this industry is
controlled by small and medium size businesses.
The forestry and agri-food sectors are active in the various
regions.
As the Bloc Quebecois critic for regional development, this
program to enable small businesses—especially in the regions,
outside large urban areas—develop, have access to financing and
create and maintain jobs for people in the regions, especially
young people, is of great interest to me.
1050
The Conservative member for Chicoutimi, whom I saw just now,
knows what I am talking about, when I refer to the
Saguenay—Lac-Saint-Jean region. We have all kinds of problems in
keeping young people in the region. Who does most to keep them
in the regions? Small business, the target of this program.
In the construction sector, 88.2% of jobs in Quebec are in small
and medium size companies with fewer than 100 employees. In the
real estate sector, 73.6% of businesses are small and medium
size. In the wholesale sector, 66% of jobs in Quebec are in
small and medium size businesses.
In Quebec, in the retail sector, which is important in rural
municipalities, in small municipalities or in big city
neighbourhoods—small businesses are the ones closest to the
population and provide more personalized services—59.7% of
businesses are small and or medium size. Also, 53% of the
companies providing services to other companies are small
businesses.
For a bill to be a good one, it must meet several criteria. It
must be recognizable by its title. We agree with the title I
read earlier. This is a bill to increase the availability of
financing for small businesses. A title is all very well, but a
bill must be real, must go beyond a mere title. Its clauses,
its content and its regulations, if possible, must go with the
title.
Suprisingly, in this case, while the purpose of the bill is to
increase financing, not a single clause—I have read and reread
them, because I am a member of the Standing Committee on
Industry, where we studied the bill clause by clause—is
consistent with the purpose. That is why the member for Mercier
and I are requesting greater access be provided for those really
needing it, those who would not otherwise have access to the
regular bank financing programs. The government must give them
its endorsement, because the government is not doing the
lending. People have to understand, this is about guarantees of
financing. The government is a guarantor, with restrictions and
with control.
That is the role of the executive. It may not be the role of
the legislators, but it is the role of government, through the
executive, specifically the minister and his officials, to
ensure that the banks see to that.
So that is why this has to appear in the bill. We will talk
more about it when we consider the other amendments, those
proposed by the government and the Reform Party, which are
intended to add controls and restrictions and which serve to cut
the program that existed in the past. We in the Bloc Quebecois
want a better law, one more appropriate to the objective. This
law must make financing more available and not reduce it, limit
it or make it unobtainable.
The act includes so many conditions that, in the end, financial
institutions may decide to make financing available to
businesses that present no risks, but that could have access to
other sources of financing. I find it very contradictory that
this would be done in the context of a bill. Our objective is a
good one and we are acting in good faith. When the bill was
introduced in the House, we agreed with its principle at second
reading. We still do, but we are now a little suspicious and
sceptical, because we realize that the amendments proposed by
the Reform Party would in the end restrict the scope of the
bill.
We oppose restricting access to financing for small businesses.
Rather, we would like to see such access increased. I hope the
government will listen to our representations and realize that
our proposals are in line with the bill. Our amendment, which
was accepted by the clerk and by the Chair, is consistent with
the bill and this brings to a close—
1055
The Deputy Speaker: I am sorry, but the hon. member's time is
up.
[English]
Mr. Dennis J. Mills (Broadview—Greenwood, Lib.): Mr.
Speaker, I always enjoy having the opportunity to speak in the
House on this bill. It was the first or second small
business bill that I ever spoke on when I was in opposition.
When I was a member of the opposition it was the first time that
our party supported the Conservative government's amendments to
the Small Business Loans Act. Support was unanimous at that time
and we put the bill through the House in a day. When I listen to
the Reform Party saying it is not supporting this bill, I am
absolutely mystified.
A Reform Party member said in his speech concerning the realm of
taxes that taxes are so repressive in this country. That is the
issue. On that point I support the member. If the Reform Party
had any consistency or any real commitment to some of its core
public policy thoughts it would help create a real debate on the
issue of tax reform. It has been the most inconsistent, on
again, off again attempt to try to advance the debate on tax
reform that I have ever seen in the House. To try to weave
something to do with tax reform into a small business act is a
non-starter.
Eighty per cent of the new jobs created today
come from small business men and women. This is the
entrepreneurial energy, this is the realm where we get people
rolling up their sleeves and doing a hard, honest day's work.
This is not the realm of paper pushing. This is not the realm of
speculating on our dollar. This is the small business realm
which is carrying the country right now. Any attempt to
reinforce the small business realm has to be supported.
I am happy to see the Bloc Quebecois, the Conservatives and the
NDP member for Kamloops, who is responsible for building linkage
with the business community, supporting this program; everybody
in the House but the Reform Party.
The Liberal Party founded this legislation some 26 years ago
under the leadership of Prime Minister Pierre Elliott Trudeau.
We are happy to continue to be the warriors for small business.
An hon. member: Say it with a straight face.
Mr. Dennis J. Mills: I can say it with a straight face.
It is the same with bank mergers. I hear today that the Reform
Party is now supporting the bank mergers. Can it honestly
believe that a further concentration of power for banks will be
beneficial to small business?
1100
The Reform Party is now supporting the bank mergers.
The reason we had to get into the Small Business Loans Act in
this country was because the banks were not taking on the
challenge of helping young people with ideas to create new
businesses. That is the purpose of the Small Business Loans Act.
It is a risk loan. There is no doubt about it. But look at the
loan loss in the Small Business Loans Act file for the Government
of Canada. In relation to the number of jobs created and the
benefits, it is minimal. Yet today we hear Reform members saying
that they will stand in their communities and say to all the
small businessmen and women that they do not support the Small
Business Loans Act. I cannot believe it, but that is the
position that party has taken.
When the Reform Party came to the House I will never forget the
opening remarks of the leader. He said “We are going to bring a
new sense of decorum to the House of Commons. If we see
legislation that we feel is constructive, we are not going to
oppose for the sake of opposing. We will get up, we will support
it and we will speak about that legislation in a positive way”.
This is a piece of no-brainer legislation. It is legislation
that is very much motherhood, and the Reform Party, for the sake
of political expediency, is slowing down the process of putting
Bill C-53 through the House of Commons. This bill should have
been through the House of Commons, all three readings, a month
ago, but instead we have the Reform Party slowing it down. The
Reform Party is putting a drag on small business in this country.
The Liberal Party will continue to be the warriors for small
business in this country.
Mr. Roy Bailey: Tax, tax, tax.
Mr. Dennis J. Mills: Mr. Speaker, there is a member of
the Reform Party saying “Tax, tax, tax”.
Let me say to the Reform Party that we are three weeks away from
the Christmas adjournment. We are about five weeks away from the
budget of Canada being locked in, which will be presented during
the first part of next February.
I am a passionate believer in comprehensive tax reform. I was
hoping that the Reform Party would focus and get some
constructive debate going in the House on tax reform. Where have
those members been? They stand up the odd time and say “tax
reform”, but when was the last time they had an opposition day
in the House on tax reform? When was the last time in question
period they put 8 or 10 questions together on tax reform? They
hit it now and again, sporadically.
Those people over there are not interested in tax reform in a
substantive way. They throw it out now and again as though it
were some kind of policy gimmick.
To talk about tax reform when debating an amendment to the Small
Business Loans Act is a diversion and we will not be suckered by
it. The legislation will go forward.
Do not mix tax reform with the Small Business Loans Act. Any
day that the Reform Party of Canada wants to have an opposition
day, or any kind of debate on comprehensive tax reform, I will
stand in the House and support that type of debate.
1105
To mix tax reform with the Small Business Loans Act amendment,
when this is the backbone of the economy of this country, is just
wrong. I stand here proudly and happily behind my parliamentary
secretary in amending this act.
Mr. Jim Gouk (Kootenay—Boundary—Okanagan, Ref.): Mr.
Speaker, I am very pleased to stand this morning to debate report
stage of Bill C-53. I certainly had some things to say about
this bill, but I now have much more since hearing the last couple
of speakers.
I would like to start by addressing a comment made by the hon.
member for Broadview—Greenwood that Reform supports bank
mergers. The reason we have trouble having meaningful debate in
this House is because hon. members across the way and sometimes
down the way like to take the smallest grain of truth and twist
it, distort it and re-organize it until it says something
completely different than what it was clearly intended to say.
I will give them the benefit of the doubt. Perhaps instead of
deliberately misrepresenting it they are just sort of buried
under by the bull that comes from their own side and consequently
they make an honest mistake.
The hon. member put out a blanket statement that Reform supports
bank mergers. What he forgets is that there was a long, long
caveat involved. We said that if the banks opened themselves to
more competition and showed that there would be benefits for
small business and other people, then we were prepared to look at
it.
How he got from that position to the blanket statement that we
support bank mergers defies imagination.
Mr. Dennis J. Mills: Mr. Speaker, I rise on a point of
order. I want to put it on the record that what I said I
believed to be the truth. I apologize to the Reform Party. I
did not realize that its support of the mergers had a whole list
of qualifications. I am sorry I did not add that list of
“maybe”, “could be”, “might be able to support”—
The Deputy Speaker: I am sure the hon. member's comments
are appreciated, but I do not believe it is a point of order.
Mr. Jim Gouk: Mr. Speaker, the member's comments are
indeed appreciated. It is very gratifying to see that no matter
which side of the House we are on we recognize the attributes of
others.
Concerning the opening statement made by the Leader of the
Opposition when we first came to Ottawa, I too said “I am not
here to oppose for the sake of opposition. If they come with
good legislation I will support it. If it is not as good as it
could be I will try to offer constructive alternatives”. That
is what we are here to do.
I would also like to address the comments made by the hon.
member for Kamloops, Thompson and Highland Valleys, comments
which must seem at first to anyone viewing this debate as a
paradox. Here we have on the one side members of the Reform
Party, people who are clearly on the side, amongst others, of
small business, the engines of the economy of our great country,
and on the other side we have a representative of the socialist
workers' paradise party speaking out on behalf of business.
We would be hard-pressed to understand where he was coming from
if we did not realize that he holds the only socialist seat in
the interior of British Columbia. Every other seat in the
interior of British Columbia, a vast province, is held by the
Reform Party. He is the last holdout so, naturally, he has to
align himself with those who would support Reform in his own
riding because his strongest and best competition is going to
come from the Reform Party.
I certainly want to address the comments made by the hon. member
for Kamloops, Thompson and Highland Valleys, as well as the
comments made by the hon. member for Broadview—Greenwood as to
why we think, although we strongly support small business in
particular, there is a problem with this bill and the whole
approach that was taken to it.
Do we support small businesses having better access to money?
Of course we do. We just question whether they should have
access to their own money that is being taxed away from them in a
variety of different ways or whether they should have to go to
the bank to borrow money to pay the taxes that the Liberal
government has imposed upon them.
1110
I would like to give one specific example. I have done it
before in a different context, but I would like to do it today
for the edification of these members and others who might be
listening to this debate.
Before I was elected to parliament I was a small business
operator. When the CPP tax adjustment, the most incredible tax
grab this country has ever seen, was brought in, I tried to make
a comparison. How would that have impacted on me had I still
been in business? I was, I think, a fairly typical small
business operator.
I operated a small residential construction company. I had some
people who worked for me full time. I had some people who worked
for me part time, on an as need basis, as the various components
of the house construction came due. I sat down and analyzed it
and I decided that, realistically, I had approximately 10 full
time equivalents between my full time people and the number of
hours that were put in by the various part time people. Ten full
time jobs. The Canadian pension plan tax increase works out to
about $600 a year per worker. As the employer I have to pay my
side of that, which is $600 for me. That is $6,000.
I used to build about 10 houses a year. My profit for house
building was about $6,000 a house. If I built 10 houses, my
profit was $60,000. Of course, I had expenses. This tax
adjustment increased my costs by $6,000. It represented my
profit on one of those houses. Actually, it was not even 10
houses. I built eight houses a year. It has been so long since
I have told this story about the CPP tax adjustment that my
business has grown, although I have not been there. It was eight
houses a year. One of my eight houses I would have to build for
the Liberal government. It was profit out of my pocket.
Then came the workers' side. I know my workers very well and I
know that under these circumstances, had they still been working
for me, they would have come to me and said “Listen, we know
that the economy is not right, that you cannot give us a big
raise, that you are not raising your prices to customers because,
if you do, we simply will not be selling houses and we will not
be working. But we cannot afford another cut in pay. So we need
enough of a pay raise to cover the $600 increase in this payroll
tax”.
If I did that, which I certainly would try to do for those
workers, it would mean $600 per worker, multiplied by 10, which
would equal $6,000. That is my second house. That is 25% of my
gross profit just to pay the increase in one payroll tax. It is
not even to pay the whole payroll tax, the entire CPP, it is just
to pay the increase. It would cost me 25% of my gross income.
Why do we oppose this bill? Because this bill, instead of
addressing those very serious problems, says to small business
“Yes, we have overtaxed you on your employment insurance
premiums. We are hiking Canada pension plan premiums. We are
doing all kinds of other things, but we are going to save the
day. We are going to come up with legislation that will make it
easier for you to borrow money to pay us”. That is why we
oppose this provision of the bill and in fact the whole approach
the government has taken to the bill.
Should it be easier for small businesses to get access to funds
they need? Yes, it should be. Any bill that does that in a
realistic manner should be seriously looked at and considered.
But we have to approach it with the concept of why they are
borrowing the money in the first place.
If I have lost, as one small businessman, 25% of my gross income
because of the increase in a single payroll tax hike, then we
have a different problem. The solution to that problem is not to
make it easier for me to borrow money to pay my taxes.
I hope the hon. member will consider it from that point of view.
It is said to him and to all other people in the House and beyond
in the most sincere manner. We have a problem in this country.
Small business has a problem. Helping them to get further into
debt to deal with this problem is not the way to solve it.
1115
I hope that he will work with us in a very non-partisan way to
deal seriously with the real problems that small business has and
to find a realistic way out of it.
As he knows by the debt crisis the country faced and is starting
to find ways out of, the way to solve our problem as a nation and
as a government in whole is not to foist it on someone else, it
is so that we can all do better together.
I know the hon. member is grateful for the information he has
just received. I know the member has other points of view that
will counter. We can go off on tangents all over the place and
say this does not agree with that. We need a starting point.
Today we are debating government's helping access for small
business to borrow money. That is the point of view we have to
start from. That is the point of view we have to stay on today.
I hope all Liberals will reconsider their position in light of
the facts that have just come out.
[Translation]
Mr. Michel Guimond
(Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ): Mr. Speaker,
I am pleased to speak to this bill, because its topic is, of
course, of interest, and besides the kind of business addressed
by this bill is worthy of attention.
What do small businesses mean to us in Quebec and in Canada?
These are our corner stores, our hairdressers, our
professionals, our dry-cleaners, our restaurant owners, our small
manufacturing businesses with three, four or five employees,
very small businesses. I believe it is our duty as MPs to take
advantage of this opportunity to congratulate them for their
labours.
Because they are so much a presence in our daily lives, we are
not always really aware of them.
When buying a paper, taking shirts or suits in to be cleaned,
going to our dentist, we tend not to realize these men and women
work very long hours and have a multitude of problems to deal
with.
They are always asking themselves: How will I make the money
last 'til the end of the month? How can I gain a bigger market
share? Can I afford to buy out my competitor? Do I need to
think about a strategy agreement with the competition? What am
I going to do? Sales are not picking up enough, and the bank is
pressuring me.
We all know how the banks operate these days. The six major
banks are making billions in profits. As we say in
Côte-de-Beaupré, when it's time to pull the plug, so long!
You are reminded of your payments, and then you go belly up
taking with you one, two, three or five employees with their
families, parents, who do not qualify under existing employment
insurance regulations. It is a one way ticket to poverty. That
is the reality of small businesses.
I think we should take this opportunity to congratulate and
thank them. There are some in my riding. I know because I go
there regularly. Last week, we were on parliamentary recess,
but we were not on holiday. Even though Parliament was not
sitting, I am sure that the 301 members in this House did not
treat themselves to a week of holidays doing nothing. We worked
in our ridings, and I respect parliamentarians for this. I am
sure all 301 MPs worked hard last week.
1120
When we are not sitting here, we are working in our riding.
Since we in the Bloc Quebecois are sure the Parti Quebecois will
be returned in the November 30 election in Quebec, we took the
opportunity to meet people and talk with our constituents.
I would like to pay tribute to these business people, to the
SMBs in Beauport, Côte-de-Beaupré and Île d'Orléans, in the
tourism sector and in all other sectors.
In order to determine the Bloc Quebecois' position on this
bill—I think all observers recognize that we are not interested
in conventional politics—my colleague, the member for Mercier
and Bloc critic for industry, developed and sold to caucus a
survey to be sent to small businesses to get their opinions on
certain matters.
The 45 Bloc members in caucus could simply have said “We think
it should be put this way”. We wanted to consult and hear from
those concerned about the topic, those on the front line. We
developed a survey, and in my riding of
Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans we are doing
the final compilations. I have received some 70 or 75
responses. I want to thank all of those who took the time to
fill out the questionnaire.
It was most useful. As my colleague, the hon. member for
Mercier, mentioned earlier, I think we have received more than
1,000 questionnaires, perhaps as many as 1,200 by now, and they
keep coming in.
I hinted at the problems faced by business people; they do not
always have the time, when they receive a letter from their MP,
to immediately sit down and fill in a questionnaire. They set it
aside until they have a minute available, often at the end of a
long day. The owner of a convenience store that closes at 11
p.m. may get around to this kind of thing around midnight or 1
a.m. They must be commended.
Responses keep coming in. We have received approximately 1,200
so far.
Based on these questionnaires, we have been able to develop the
Bloc Quebecois' position on Bill C-53. There were a number of
expectations regarding this bill. One might have expected it to
contain provisions to improve access to credit for small and
medium size businesses in Quebec and Canada.
One might also have expected a program making credit available
to those who might not obtain financing otherwise. We also
expected this legislation to provide business people with tools
to finance their working capital in order to ensure the growth
and development of their businesses.
There is nothing in this bill to improve the situation for small
and medium size businesses. Regardless, given its purpose, our
party will vote in favour of Bill C-53, as I think my colleague
from Mercier indicated. However, we urge the government to very
seriously consider the amendments put forward by the Bloc
Quebecois to ensure that the legislation truly meets the needs
of small business.
We do not want the good news for these businesses to be only
that the small business loans program is maintained, but rather
that it is maintained and improved.
The purpose of our amendments is to correct the deficiencies we
have detected.
There will be an opportunity for debate, at committee stage and
again at third reading. We urge the government to seriously
consider the amendments introduced in good faith by the hon.
member for Mercier on behalf of the Bloc Quebecois.
Let me emphasize a few, starting with the first amendment,
dealing with section 2 of the act, to ensure the purpose of the
act is clearly stated. To some extent, insufficient financing is
worse than none at all, since the business cannot grow as it
should. This amendment therefore endeavours to clearly define
this program to provide financing that would not otherwise be
available to small and medium size businesses.
1125
Our second amendment concerns clause 13 and is aimed at
broadening the scope of pilot projects to include the financing
of working capital in order to ensure the growth of small
businesses.
The last two amendments we will be bringing forward concern
clauses 18 and 19, and their objective is to go beyond the
simple accounting vision of the small business loans program.
After hearing the witnesses who came before the Standing
Committee on Industry, we realize that not only are the
macroeconomic effects of the program not measured, but they are
not even known. Therefore, we are proposing that employment be
taken into account in measuring the usefulness of this program.
We need to do more than just tighten up the old SBLA. The Bloc
Quebecois believes that the accounting review proposed in this
bill cannot be made without assessing the need for economic
development. These amendments are vital to economic development
and to job creation.
Mr. Speaker, I know you represent an Alberta riding. Look in
your riding to see what type of businesses have created jobs
over the last five years. Of course we would all like to see
major industrial developments creating 2,000, 3,000 or 5,000
jobs. Of course we would all like General Motors to open a plant
in our own region and create 1,200 jobs. There is not one single
member here who would be stupid enough to say “thanks, but no
thanks”. We would all be happy about that.
But who has created jobs in Canada and in Quebec over the last
five years? It is not large businesses. Just look at the
numbers.
I worked in the pulp and paper industry for 14 years. The number
of workers in that industry has decreased considerably over the
last five years because of modernization and automation.
Who creates jobs and economic development? Small and medium size
businesses, and they need the encouragement of this government.
[English]
Mr. Gurmant Grewal (Surrey Central, Ref.): Mr. Speaker, I
am happy to speak on Bill C-53. I oppose this bill, which I
spoke to at second reading.
Government members have talked about bank mergers and the Reform
Party opposing the bill for the sake of opposing. That is
garbage. We are not opposing the bill for the sake of opposing.
My party's leader was accused of something he did not do. That
is normal practice for them. The media used to do that but have
learned a lot and do not do it anymore. Canadians have learned
about that and my colleagues from the other opposition parties
are learning that. However, the Liberals are slow to learn. Some
of the members will never learn, but let us forget about that and
talk about the bill.
Motion No. 1 was put forward by the Bloc member for Mercier. The
motion is similar to the motion proposed by the Bloc in committee
during clause by clause consideration of the bill. The Liberal
MPs in committee saw it as a friendly amendment but they voted
against it anyway. We also voted against it, not because we are
against increasing access to financing for small businesses but
because we do not believe the way to do it is through taxpayer
funded programs.
The bill is entitled an act to increase the availability of
financing for the establishment, expansion, modernization and
improvement of small businesses, but that is not what the bill is
about. The Liberals have failed to change the bill to suit
market needs. The official opposition would support the
modernization of the Small Business Loans Act, the precursor of
this bill, the Canada small business financing act.
1130
We would like to support improvements in financing for small
businesses because we recognize that small businesses are the
backbone of our economy. They are the ones that are creating 96%
of the jobs in this country. However, the Liberals are proposing
something which is not good enough. I will give the reasons why
the official opposition is not supporting this bill.
The objective of the bill is to increase the availability of
loans to small businesses. We mean incremental loans. This bill
does not provide significant additional loans to what is already
being provided by the financial institutions.
In 1996 a study showed that 46% of the beneficiaries would
obtain loans anyway even if the SBLA was not there.
This bill does not address the lack of working capital
availability for small businesses. We are talking about equity
of the businesses not debt financing. We need better tools for
small businesses. The Canadian economy has evolved significantly
since 1961 and essentially this legislation remains unchanged
regarding types of assets eligible for financing.
The service sector, knowledge based sector and information
sector form a much greater part of our economy today and have a
high net employment growth. Their needs are not addressed in this
bill.
Motion No. 1 does not address those needs. These questions
require careful consideration in reviewing this legislation.
The bill does not provide for capital leasing which is important
for small business. The bill does not provide adequate review of
risk analysis. There is no provision for losses. The borrowers
are not guaranteed. The financial institutions are guaranteed;
even if they make bad decisions their decisions are guaranteed,
but small businesses are not.
Another reason our party is not supporting the bill is because
of the job creation record which is very bad. According to the
auditor general the displacement effect is negative. The
government is boasting that the Small Businesses Loans Act
creates jobs but that is not true.
The bill does not put a mechanism in place to control the
financial institutions not to charge an administrative fee, which
they are not entitled to. They have been charging the
administrative fee when the loans have been provided under the
Small Businesses Loans Act.
Another important check should be that related borrowers do not
abuse the system. The larger companies will form smaller
companies or subsidiaries and will abuse the system because of
the threshold limit. The auditor general has found 23 examples
where related parties will collaborate and abuse the system. The
act targets small businesses. It is meant to support small
businesses, not large businesses.
Information on results provided to parliamentarians is not
adequate. It is not sufficient. We cannot monitor the output.
We cannot look at the results of the implementation of the act.
Industry Canada does not audit any accounts until a file becomes
a claim file. When the file is a claim file it will be audited,
but before that no one cares about it. No one looks into it.
Those are a number of the reasons that the official opposition
will oppose this motion.
1135
The Canadian Federation of Independent Business has been saying
that if the current abuses of the Small Business Loans Act were
curbed and if the parameters of the program were restricted, this
program would require less of an allocation of funds while being
effective in meeting the program's objectives.
The thresholds for financing are too high. The legislation
defines small businesses as those firms that have up to $5
million in sales. What kind of small businesses are we talking
about here? We are talking about medium size businesses. The
Small Business Loans Act is targeted. Its objectives are to
finance small businesses, not medium size businesses and not the
large businesses.
Large businesses are getting enough subsidies from this
government. Twenty-five million dollars was given interest free
to Bombardier, a firm in Quebec. Does the government give
interest free loans to small businesses? No. Canadians know
that.
The job creation record and so many other things I mentioned
will make sure that the official opposition is firm in its
decision not to support this motion. I will not go into more
detail. That is enough for members to learn something and to
look into it.
Until suggested amendments are addressed, how can any member in
this House support the bill? The department needs to clarify
expectations and develop indicators of the program's performance
in establishing, expanding, modernizing and improving small
businesses.
The official opposition is for small businesses but in the true
sense. We do not want to have legislation in place that has no
teeth. We do not want legislation in place just to give the
opportunity to pat the government on the back when it is not
doing anything good for small businesses. Small businesses
already pay high taxes. We know how employment insurance and CPP
premiums are killing jobs and killing small businesses.
Those are the reasons the official opposition and I in
particular will not support Motion No. 1.
[Translation]
Ms. Hélène Alarie (Louis-Hébert, BQ): Mr. Speaker, I am pleased
to rise in this House to speak to Bill C-53 and to support Motion
No. 1 moved by my colleague from Mercier:
That Bill C-53 be amended by adding after line 22 on page 2 the
following new clause:
“2.1 The purpose of this Act is to
increase the availability of financing of small businesses, which
would not otherwise have access to financing.”
It is the small businesses we are concerned about, and it is
unfortunate to note that, while the bill is necessary and we
support it, it does not meet all our expectations. It contains
no provision for further improving the situation of the SMBs as
it stands.
First, Bill C-53 does not give SMBs greater access to credit. It
does not make financing available to businesses that could not
have it otherwise. We must understand that, in the context of
this bill, SMBs unable to obtain financing from the banks at the
moment should not look for anything more from this program.
No mention is made of financing SMB working capital and, as we
well know, this is a major problem in most SMBs.
So the issues in this bill are quite apparent in the reading of
it. It might be a good idea to remind ourselves of the
importance of SMBs in our economy.
In 1995, the most recent census year, SMBs with fewer than 100
employees accounted for 99% of the 935,000 businesses operating
in Canada. That is huge. This represents our business employee
payroll. They therefore employed 42% of private sector workers
paying 38% of all salaries. There is nothing small about that.
The SMBs are also fragile. These same statistics indicate that
15% of them go out of business in the first year of operation.
More than half the businesses that existed in 1989 were no
longer on the market five years later, when the census was done.
1140
Overall, the Bloc Quebecois is in favour of Bill C-53, but we are
very disappointed that the revision of this bill does not pay
more attention to small business loans.
We must also add, as far as issues and context are concerned,
that the wages paid by small and medium-sized businesses are far
less than the impact they have on employment. Average wages are
therefore markedly lower than those of big business, and close
to two-thirds of salaries in Quebec come from big businesses or
major institutions.
The question may arise: “Do you have any proposals, do you have
a position on this?” Yes, the Bloc wants to see legislation that
serves small and medium-sized businesses.
The amendments proposed by my colleague, the hon. member for
Mercier, are intended precisely to enhance, to improve what our
small businesses need.
We need provisions to improve access to credit for small and
medium-sized businesses in Quebec and in Canada. In two
different surveys, including one by the Canadian Federation of
Independent Business, 29% of small and medium-sized business
owners report that the availability of credit is one of their
main preoccupations, if not the foremost. In other words,
one-third of small business owners are continually struggling to
find or renew credit.
In the second survey, carried out by Bloc Quebecois MPs among
small and medium-sized businesses in their ridings, 89% of
respondents report that it is very difficult, or difficult, to
get credit at a reasonable rate.
Only 10% of small and medium-sized businesses responded that they
were able to find funding in their community with any ease.
Some small and medium-sized businesses—and we had proof of this
when we met with the bankers and caisse populaire people—are very
well known in their own little circle. The relationship of
trust between the lending agent and the new or potential
business is therefore a given. This is not the same when the
small or medium-sized business is in a larger riding, or in an
urban area.
But that is not the only thing. There has certainly been a
change as far as the lenders are concerned. A few years ago, a
woman wishing to get a loan to start up a small business had to
face a most ridiculous situation.
The first question she would be asked was: “Do you have a
husband?” The second one was: “Is he gainfully employed?” The
third question was: “Can he secure your loan?” I am not going
back to ancient history. This is very recent.
However, some institutions were more open and lent more and more
often to women. It was realized that, because women were more
concerned and had a greater need for security, there were fewer
bankruptcies among women than among men.
We have gone beyond that first stage and women are now able to
get the loans they need.
But today there are others who are experiencing the same
stressful situation, namely young people. Our young technical
school and university graduates are full of ideas. They are our
wealth and they are prepared to start on a small scale. They no
longer have this mentality of trying to get a job with large
businesses or government organizations, since jobs are now very
scarce in these sectors.
What do these young people full of ideas and initiative do when
they graduate from university? They go to a banking institution.
That institution will not ask them if they have a husband or a
wife, but if they have a father or a mother. These young people
go through the same process that we women went through, perhaps
10 years ago.
It is unfortunate that the process is so difficult. This is why
we would like the bill to include a program giving access to
credit to small and medium size businesses that would not
otherwise have easy access to financing.
1145
I referred to young people. I also want to talk about innovative
businesses and ventures, several of which make it. If EDP
businesses had been prevented from getting financing, we would
not be near where we are now. At the beginning, it was
considered risk capital, but then it was realized that, on the
contrary, this was a solution for many. It is also risk capital
in the case of innovative people such as weavers. Who will
finance a weaver?
We want to give businesses the means to fund their working
capital, so as to ensure their growth and development. Some
businesses sell tires. It is a seasonal industry. They have a
tough time maintaining their working capital. The same goes for
the horticultural industry.
All these small and medium size businesses have fixed costs.
They must modernize their operations, they have to deal with red
tape, and they need accountants, legal advisors and other
experts. These are all costs of doing business.
Finally, the little country girl in me would like to tell you
that Quebec's Solidarité rurale has said that one job in a small
rural riding is equivalent to 1,000 jobs in a city.
[English]
Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, I
rise to speak on this first motion, but I must say I cannot
support it because the whole premise of this bill is wrong. It
represents a transfer of wealth from successful businesses and
workers to people who want to be successful businesses and
workers perhaps even in competition with the people who are
providing the funding through their guarantees for the loan
program to proceed.
The auditor general in his report has already proved that it
does not work to create jobs that way. We do not create jobs by
trying to take away jobs from someone else by robbing them of
income and capital to expand their businesses. So it is just the
wrong way completely to go about the whole financing for small
business.
I do not deny for a moment that small businesses are a source of
most of the jobs in Canada. Like my colleague from the Kootenays
who was speaking earlier, I have been a small business
entrepreneur since the time I arrived in Canada in 1979. I too
had to find financing to start a business and to begin employing
people.
In 1980 when I was first starting up my business in Canada I had
a new idea in telecommunications. Because it was a new idea that
the banks had never seen before they would not lend me any money
to get started. But never for a moment did it cross my mind that
I should somehow lobby government to provide some sort of
taxpayer funded protection for me to start my new idea. That
never even crossed my mind as an entrepreneur.
I found other ways to raise the money through private venture
capital and people who would grant me a lease on a new business
and so on. I was able to get started without the banks. My
business was extremely successful. It grew very well and I began
to employ people. When it had grown to the size of about 12
employees I sold the business and I moved into another area of
business which relates to this bill very well. That business was
financing small home based businesses through lease programs. I
actually filled through my small business one of the niches that
the banks would not fill, to help small fledgling businesses with
financing, in particular the ones that worked from home.
A lot of businesses these days are started at home. They have
difficulty getting financing to buy their first fax machine,
computer, office desks and all the equipment they need to be in
business for the first time. My company filled the gap by
providing financing to that area.
The problem was that sometimes in order to finance the company
we would have to put a mortgage on the person's home. As soon as
we did that in my company it became an investment, not a
business, and we were taxed at 50%. That was 50% tax on a
business. As a direct result of the government stealing away 50%
of what we made by helping that small business it prevented us
from investing in more businesses. The government took so much
off we did not have the capital to help more businesses.
1150
What I am illustrating here is a very effective way for the
government to help small businesses to get financing. It should
not tax so heavily the venture capitalists and the people
providing leases and mortgages to help small business. It should
cut the taxes for that group and then that group is left with
more capital in its businesses to help the fledgling businesses
get started. We are then not taking taxes from other successful
businesses for these new ones to start being in competition.
Frankly, small businesses can always find financing if they have
a good idea but it is the price of financing that becomes the
issue. What happens with this type of bill is that taxpayers end
up subsidizing the price by providing guarantees to the banks in
order to take more risks. Is that really a just sort of thing to
do, to cause taxpayers to subsidize the price of money that
people want to borrow for their good ideas? I do not think it is
a just way to approach the problem.
Accessing capital is the problem. It should not be done through
this type of bill where we use taxpayer funded guarantees.
I think the member for Broadview—Greenwood mentioned that the
loan losses were minimal. That may well be the case. I believe
about 6% of the loans are in default at the moment. However,
that is really not the question. The issue is not how many of
these loans are in default. It is whether it is the right way to
go about lending money to small businesses.
The point is who should absorb these losses. Should it be the
taxpayers, the entrepreneurs, the venture capitalists or the
creative financiers out there? I think it should be the
entrepreneurs, the venture capitalists and the financiers. It
should not be the taxpayers who absorb the losses. That is the
whole point. This bill is the wrong way to go about helping
small businesses with their finances. All it does is use other
people's money.
As we have said hundreds of times over the past five years in
the House, it is so easy for members on the other side of the
House to take other people's money and hand it out to other
people because it does not come out of their pockets. The
question I have to ask all members on the other side is if they
had to finance a small business asking for money, would they give
it the money out of their pockets. That is what it comes down to
in the end.
We would be much better off encouraging the private venture
capitalists and small lease companies like the one I ran before I
came to this House. We should help those companies by lowering
their taxation in order to have more capital available to help
these small businesses get started. That is certainly the way to
go about it.
We talked about bank mergers a bit this morning. Government
members all went ballistic that maybe Reform would support the
bank mergers if we got a few conditions imposed. Why not make
one of the conditions for a successful bank merger for them to
provide some sort of venture capital at a higher risk management
level for small businesses? We have a magnificent opportunity
here to talk with the banks and start bartering some conditions
without having to ever put a single dollar of taxpayer guarantee
on the line. We could do it by bartering conditions with the
banks.
There are plenty of good ideas out there. I hear them from my
constituents all of the time. There are other ways to approach
this which is really why the Reform Party is opposed to this
bill. We really believe it is the wrong way to go about it. All
that will happen in the long term is that the amount of
guarantees and the size of the portfolios will continue to
increase until we end up with the taxpayer on the hook for more
and more. It could be completely avoided by approaching it from
a different position.
When banks take a look at these proposals that come before them
from small business it is not because they could not care less.
That is a common idea that we put forward but if I use my own
example in 1980 when I was trying to get financing for my
telecommunications business, I could tell that the bank would
have liked to have lent me the money if it could have found some
way to make it fit its profile and if it had the confidence that
my idea was one that would work.
I am not going to make the banks out to be ogres because they
turned me down. They made a sound business decision on the basis
of the criteria on which they lend. It is a loan officer's job
to lend out money. That is what they are there for.
They keep their jobs by lending out money. They want to lend
money.
1155
I certainly do not hold a grudge against the banks for turning
me down. It actually missed out on making a tremendous amount of
income because I took my business to someone else, to a private
financier who made all the interest from the start-up costs as I
got my business off the ground. The profit went to other than
the banks.
It is not always that they could not care less. I do not
believe loans officers have that attitude. I think they do their
best to lend if they can.
As a member of parliament I have had people approach me from
time to time who were upset that their loans were turned down or
the loan applications were turned down or they had been to the
federal business development bank and could not get financing.
When I took a look at their situation, I would not have given
them the money either.
There are some people on the other side who think that
entrepreneurs starting a new business should not have to take any
risk, that somehow everybody else should take the risk but not
the person with the idea. We have to get a balance. Some of the
suggestions I made earlier in my speech would be good, practical
ways to handle the situation and that is why I am voting against
the amendment.
[Translation]
Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques,
BQ): Mr. Speaker, it is with great pleasure that I rise today to
speak on this bill and on the amendment moved by the hon. member
for Mercier. In so doing, she speaks for all would be
entrepreneurs who cannot make sense of the financing assistance
process for projects that may not meet traditional business
criteria in our capitalist system. She speaks for the people who
need a hand, a little extra assistance and special attention.
It is our duty to some extent, at the government level, to
ensure attention is paid to this kind of project.
In all our ridings, we have people coming to see us with some
interesting and dynamic projects, projects requiring the second
generation assistance to small business that was and can still
be provided through the SBLA program, but which we would like to
see improved in the future.
There is a great deal of competition to start up businesses at
present. Many people have been told for years to get into a
different line of work. Young people are being told they ought
to start up their own businesses.
The purpose of the amendment moved by the hon. member for
Mercier is to go beyond technical and housekeeping changes and
give those who want to start up a business a real chance to do
so.
This is particularly true in regions like mine, in KRTB and the
whole Lower St. Lawrence region.
There are business assistance programs like the self-employment
assistance program to help establish what is known as very small
businesses. What is also needed is programs that help businesses
grow, through tailored support and follow up, to give those who
are interested in starting up a business an opportunity to do
so.
This spirit, this willingness are not to be found clearly in
this bill. We think it should be supported because it contains
interesting provisions, but there is still room for improvement.
It is possible to give it more of a social flavour to allow
businesses to blossom in this country and to allow young
entrepreneurs to go into business. These entrepreneurs are not
necessarily young in terms of age, but there may be young
entrepreneurs of 40 or 50 years of age who, after a career in a
field where jobs have disappeared, see the opportunity to go
into another field.
They do not necessarily have all it traditionally takes right
from the start. They may occasionally be rejected by banking
institutions whose approach is based on accounting. One can
understand this vision that financial institutions have, but we
must ensure that, at the government level, we allow more and
more businesses to open. Small and medium size businesses are
the ones that create the most jobs.
In my region, for example, there is a multinational, Bombardier,
that has a dynamic and interesting plant that is doing well.
However, when the economy slows down or when business is a
little slow, we must have people ready to fill the void quickly
and to submit their projects. And we must listen to them so they
can launch and carry out these projects.
1200
It is often a question of attitude in receiving the
applications. To have an open attitude, financial institutions
must feel the government is behind them to support this type of
project.
Our first amendment, adding clause 2.1, is aimed at clarifying
the purpose of the bill. In a certain way, insufficient funding
is worse than no funding at all. Without sufficient funding, a
business cannot develop as it could and as it should.
It is a comment we frequently hear from people who started a
business and who come to see us. They often did it with a
maximum of energy and a minimum of resources.
They manage to survive, but they would need an extra hand,
particular assistance, a specific kind of assistance. Help to
really give people a hand up is not available at present.
The first amendment proposed by the hon. member for Mercier is
aimed at clearly defining the program so that it will also
provide financing to small and medium size businesses that would
not otherwise have access to financing. The door must be open,
a chance given, the idea given a chance to expand and to be
realized.
Perhaps one of the ways to assess how relevant and effective the
legislation has been, a few years down the road, would be to see
whether fewer of the people who have set up businesses end up
coming to see their MP feel frustrated because the program was
not sufficiently flexible to give them a chance to get started,
whether they have been getting a better reception when they go
knocking at the door of the financial institutions and the
development agencies because there is legislation covering
financing, and whether this bill gives them more latitude.
This situation is particularly true for women. A number of
women in my riding come to me saying “It is a reality that we,
as women, are more used to being straightforward in our personal
activities, used to telling it like it is”. They do not
necessarily have the traditionally male salesman's gift of the
gab, but when they come in to see their bankers they paint a
very clear picture of the reality of the business they want to
set up. They are not there just to “sell” it.
This may have negative impacts for them at present, but it would
be important for financial institutions to be more open to their
needs. Women with plans to open a business set out all of the
advantages and disadvantages and to put everything on the table.
They must not be penalized for doing so.
Knowing the advantages and disadvantages, what counts is finding
a way to deal with them and how help can be given. The bill
before us is one of the tools that can be used in this context.
It must be flexible, providing opportunities to women with this
sort of business proposal, who do not fit the traditional mould.
We are not talking about equality in presentation, in
organizations deciding on these matters, on loans in financial
institutions. People's attitudes need to change and we can help
bring about this change by amending the law.
I think we can apply the same reasoning to young people.
Special efforts have been made in Quebec, among other places, to
develop job training. We have started up the machine again.
Five years ago, the last Liberal government almost stopped
giving people job training; today we have started the machine up
again. These people we are training, who will be plumbers,
carpenters, electricians and workers in new areas of technology,
will need a boost to be able to start up businesses.
Twenty-five years ago, when people were working in these fields,
they often worked for others. Now, these people often have to
take over the business and they need the right conditions. Our
bill on financing for small and medium size businesses needs
flexibility.
We can make sure, for example, in the case of people who are
reaching the age of 55 or 60 and getting ready to sell their
business, that there is a way young people can take over and
thus provide for their family and help our regional communities
to achieve their full potential.
1205
Without questioning the entire bill, I think the Liberal
majority should look very carefully at the constructive
amendment proposed by the member for Mercier. This amendment
simply recognizes the fact that the government is responsible
for more than rubber-stamping the decisions made by financial
institutions. It is responsible for giving small businesses a
boost.
I think the bill before us can achieve this objective in the
end, and this is why it needs improvement.
[English]
Mr. Roy Bailey (Souris—Moose Mountain, Ref.): Mr.
Speaker, I have been listening with interest to such terms as
risk capital, investment and all other terms which the people in
my constituency are using a great deal these days.
In the last two days and in the week previous to coming back to
the House a minimum of 13,000 small businesses located across the
beautiful constituency of Souris—Moose Mountain are in deep
financial problems. They are not unlike other businesses in
Canada. They have a huge capital investment. They also have a
huge expenditure each year of operation. They have reached the
point in the last year where their annual income is down 70%. The
bad news is that the forecast for these 13,000 businesses is that
they will be down even further in 1999.
These businesses are sitting with a minimum of $500,000 or more
in capital outlay with huge taxes, tremendous taxes which have
gone up some 48% in five years. The products they put on the
market are literally worth nothing. These primary businesses do
not qualify for the same protection as the bill is talking about.
They do not qualify under this type of loan. They do not qualify
under the loan guarantee. They are simply sitting there
suffering and many will close up.
I go to the cities and the towns and talk to small businesses. I
ask what they would truly like more than anything else. The
other day I went to see the person who runs the Dairy Queen. It
is great stuff; there are no calories in it or anything. The
owner of the Dairy Queen asked me to send some people who had
change in their pockets so they can continue their spending
habits. I checked with the manager of another store and asked
how were her sales this August compared to last August. That is
the month when parents get their kids ready to go back to school.
Her response was that it was the worst August since the business
was established.
What I am referring to is directly related to the bill. Because
these 13,000 small business people are currently going down the
tube they will pull down a proportionate number of other small
business people in towns and cities with them.
I am referring to our primary industry in Saskatchewan. It is a
high investment. They vary in age. Many of them, 70% in some
areas, have to work for other businesses to support their
businesses. I conducted a research of three separate RMs and the
lowest was 50%.
1210
We can talk about business loans, business ventures and
everything else, but if the government does not take a look at
how it will support Canada's number one industry which is going
down the tube it is useless to have the bill before us.
I beg the government to take another look at the situation faced
by these 13,000 farmers in my constituency, many of whom will not
be farming next spring without some assistance. Other businesses
will go as well. They get no guarantees. They cannot draw upon
money which is theirs. They cannot take advantage of similar
government programs. I learned that under NISA they cannot even
draw from their own accounts if they are working off the farm.
I spent three weeks trying to pacify young people of 40 years of
age who are walking away and leaving what was left by their
ancestors, leaving what was their dream. While the government is
taking a look at the bill I beg it to remember the 13,000 small
family businesses in my constituency. The bill may assist
businesses but it will be an absolute failure unless it takes
them into account.
[Translation]
Mr. Jean-Guy Chrétien (Frontenac—Mégantic, BQ): Mr. Speaker, we
are debating Bill C-53, an act to increase the availability of
financing for the establishment, expansion, modernization and
improvement of small businesses.
In the mind of the minister, it is just another version of the
previous legislation. Several members from various parties,
mainly opposition parties, have proposed amendments.
Among these members, my colleague from Mercier proposed several
amendments, one of which I find particularly interesting. I am
talking about Motion No. 1, which was moved today, November 17,
and which reads as follows:
“2.1 The purpose of this Act is to increase the availability of
financing of small businesses, which would not otherwise have
access to financing”.
Right now, the banks are not really interested in providing
financing or lending money to small businesses that are not
absolutely viable. In other words, it is a lot easier for a
financial institution to lend money to Bombardier, for example,
or to General Electric or to another big company like Loblaws,
than to do so to a small business with assets of three quarters
of a million or a million dollars.
This small business often creates proportionally 10 to 20 times
more jobs than these large multinationals that think more about
money than about creating jobs.
In this context, I took part, with my colleague from Mercier, in
a large poll in my riding. I polled more than 1,300 small
businesses about the financing offered to them. I was amazed at
the response rate I got and I realized that financing is
essential and that it is also a concern for the vast majority of
our small businesses. For example, when there is the slightest
doubt, the interest rate on a loan goes up 1 to 3%.
1215
Obviously, if a business must pay maximum interest, its survival
becomes even more problematic. But there is worse. Someone
phoned me last week, when the House was not sitting, and invited
me to meet him and visit his small business. That person showed
me a letter from a banking institution asking for additional
guarantees or the institution would demand full payment of its
loan within 48 hours.
The bank is putting a gun to the head of this business owner,
who employs 10 people in a small rural community. This is a
major cause for concern. He turned to another lender who agreed
to provide financing, but at a much higher rate than was to be
expected at this time.
Our small and medium size businesses have the right to expect
provisions that will increase access to financing for them, both
in Quebec and in the rest of Canada. They are also entitled to
expect a program that makes financing available to small and
medium size businesses that would otherwise have a much harder
time getting financing elsewhere. Such provisions would also
provide entrepreneurs with the means to fund their working
capital—and that is important too—to ensure the growth and
development of their small and medium size businesses. These
comments were made when I polled 1,300 of these businesses in my
riding of Frontenac—Mégantic.
Bill C-53, as introduced by the minister, does nothing to
increase the availability of financing for small and medium size
businesses. It simply changes how the government's total
commitment is calculated, but there is no increase. The
underlying principle that guided this review of the SBLA does
nothing to meet the needs of small and medium size businesses.
The government is much more concerned about figures.
Bill C-53 does not help provide financing to businesses that
would not otherwise have access to such financing elsewhere.
Let us not forget that small and medium size businesses
currently create many more jobs than large businesses employing
500 or 1,000 people. There are fewer and fewer of these large
companies, with the result that, overall, small and medium
size businesses generate many more jobs.
For example, in 1994, businesses with less than 100 employees
accounted for 41.2% of all jobs in Quebec. I imagine the
situation is essentially the same in the rest of Canada. In
Ontario, that percentage is a little lower, at 34.7%.
Over the past 20 years or so, in Quebec and many other
countries, employment in small business has increased
significantly, rising from 36% in 1978 to 45% in 1993. Everyone
agrees, and the figures are there to prove it beyond any doubt,
small business is number one in creating jobs.
Small business plays the most significant role in job creation,
especially in agriculture, fisheries and forestry. We must
recognize also that it adds value to regional production. The
expectation is that the jobs will remain in the region.
1220
Take hog houses for instance. What good is it to have hog houses
in a given region if, once hogs have reached their ideal weight
for human consumption, they are shipped by truck or train over
hundreds of kilometres to facilities where they will be
slaughtered, processed and shipped overseas or sold for domestic
consumption in Canada?
People in the rural region where these hogs were raised, who had
to live with the smell of the manure spread on the land, are not
happy with just a few jobs.
If the hogs could be slaughtered locally and if the carcasses
could be processed locally, hundreds of direct jobs on the farm
and in the hog industry could be created.
The same thing goes for the maple syrup industry, where we could
do some processing locally. Instead of selling the syrup in
45-gallon barrels, we could sell maple candies in beautiful
gift-wrapped boxes, and things like that.
So, throughout the country, small businesses have been the main
source of job creation locally. For more small businesses to be
established, they need to be able to obtain the necessary
support and financing.
This morning, before I came to the House, I got a call from
Lac-Mégantic, where preparations are underway to set up Place aux
jeunes. As you know, we raise and educate our children.
They often choose to get some training or go to university in
some of Quebec's larger cities and many of them never come back
to the Lac-Mégantic area.
So, Nathalie Labrecque is working with the CFDC and the Comité
jeunesse de la région de Lac-Mégantic, in the Granite regional
county municipality, to set up a group called Place aux jeunes.
With appropriate financing, we could provide our young people
with the support they need to start up their own business.
[English]
Mr. Keith Martin (Esquimalt—Juan de Fuca, Ref.): Mr.
Speaker, it is a pleasure today to speak on Bill C-53 at report
stage. Once again, unfortunately, the government is using a
band-aid solution on something that is exceptionally important to
Canadians. It is not getting to the essence of the issue and it
is not dealing with the specific and effective solutions that
could be implemented today to dramatically improve the health,
welfare and economic future possibilities of Canadians.
My colleagues have and will mention the flaws in the bill, that
it is a band-aid solution and that it puts on the shoulders of
Canadians a $1.5 billion liability. Instead of providing these
small funds to businesses what the government should be doing is
creating the climate to improve the business community in Canada.
I will now talk about specific, pragmatic and effective
solutions the government can do in conjunction with its
provincial counterparts to improve the economic situation in
Canada.
I will start at the top, with fiscal policy. The government can
introduce a process for a 10% reduction in expenditures, not by
putting it on the backs of the provinces but by truly reducing
the expenditures within the public sector. It can do this in an
effective way by making sure that the good people it has working
in the bureaucracy are able to do the jobs they are trained and
tasked to do. At the end of the day all the hard work they do
will result in action as opposed to the situation we have now
where most of us in parliament are running around in a circle
because of all the work we have to do which does not result in
action, as opposed to having a system where meetings, tasking and
work actually result in action and outcome.
We could also enact balanced budget legislation. A balanced
budget law could be enacted and I am sure the government would
find a lot of acceptance on this side of the House.
We have asked for a debt reduction plan for a long time. The
government has not set debt reduction targets yet. It can and
should do that. By having and setting targets we have goals. If
we have goals, we have objectives. If we have objectives we have
something to shoot for.
Right now there is absolutely nothing.
1225
The next thing it can do is stop providing loan guarantees to
businesses. We have created in North America a corporate welfare
state where money is being given to the private sector,
particularly big businesses, not little ones. This is not
necessary.
Why should multimillion or multibillion dollar companies receive
money from taxpayers? That is what we saw in the case of
Bombardier and other companies. This is completely unnecessary.
The government has continued to fail in improving the taxation
policy. I have gone around, as most of us have, and asked and
consulted with the private sector, with small businesses. What
did they say? They begged and pleaded for a reduction in taxes.
They said the government does not need to give them money but it
needs to give them the ability to create jobs. They cannot
create jobs given the heavy tax burdens they have today.
Since we came here we have said that those tax burdens are
killing jobs. If the government does not believe this, let us
look at where economies have worked and where they have not. Let
us look at economies where they kept high taxation and what they
did after the taxation levels were lowered.
England and Ireland had high taxation rates and complicated
rules and regulations but have reduced them dramatically. As a
result their economies are booming.
Some on the left like to cite the example of northern Europe. We
need to look at Sweden. Sweden had a very high tax policy and
when it reduced those taxation levels the economy boomed
dramatically. That is what is happening.
Governments and countries that pursue a high taxation policy
kill their economies. Governments that pursue a low taxation
policy and lower regulations improve the economy.
Look at our case. My province of British Columbia is the worst
place in North America to do business, bar none. Premier Clark
likes to point his fingers to the far east and say it is the
Asian flu. Our economy was in trouble long before the Asian flu
hit. The statistics are there to prove that all across the
resource sector and many others.
Let us look at Alberta and Ontario where they have lowered
taxation rates, where they have lowered the rules and
regulations. As a result those provinces are improving
dramatically in their provincial economies.
Why does British Columbia not do that? More important, why does
the federal government not do that? Why do the feds not take it
upon themselves to intelligently look at this taxation system, to
look at what has worked before and lower the taxation levels that
are weighing like a huge rock on the shoulders of Canadians, be
it in the public or in the private sector?
We need a 20% reduction in personal income taxes, which can be
done. A marrying and harmonizing of the PST and the GST could
lower this. Also, why not look at a flat tax or a simplified tax
system?
I was having meetings last week in my riding, as most of us
were. People asked repeatedly why we cannot simplify the tax
system. As individual citizens, many people require a tax
specialist to do their taxes. That is absolutely insane.
Why does the Minister of Finance not work with the minister of
revenue to put some of their people together to see how to
intelligently simplify our tax system to make it fair and
applicable?
Our party has repeatedly suggested that we increase the minimum
taxes somebody pays, lower the tax rates for everybody. We have
proven that those in the lowest socioeconomic groups would
improve dramatically. We have to make sure they, most of all,
are taken care of.
More important, because taxation rates would be lowered all the
way through, including the business sector and the upper levels,
they would then have the ability and the tools to create jobs.
The left likes to talk about hitting the rich, hitting the
businesses. What happens when taxes are increased for the
business sector? They leave.
Comparing our taxation system to that of the United States, our
primary competitor, a family of two income earners will earn 44%
more in the United States than in Canada.
That in part is contributing to the brain drain. We are losing
our best and brightest. It is also contributing to the loss of
businesses.
1230
Clearly the government can see that and it can act. If the
government were to act and consult with other parties, it would
find agreement in pursuing this common agenda. Why the
government does not do this is beyond me. I think it is beyond
many Canadians who see what is going on try to understand why
this is happening.
Other things can be done. There are the regulatory policies. We
have a great ability to institute regulations. We have to
analyze whether those regulations are actually working and if
they are not, to remove them. Every government department should
look to see whether regulations which have been implemented
previously are necessary.
Right now we are piling regulations on top of other regulations
rather than trying to determine whether or not a regulation is
necessary. There would be widespread approval if this year the
government took it upon itself to rapidly develop a task force to
look at these regulations, eliminate the ones that truly are not
necessary, and then set up an ongoing process to evaluate the
necessity of the rules and regulations that we have.
The federal government needs to work with the provinces on
labour policy. Many rules and regulations in labour are not very
effective. I would like the government to look at the U.S.
experience with right to work legislation because where it has
been employed there has been a dramatic increase in employment.
There has been a dramatic increase in the order of $2,000 to
$3,000 per person who is working in a state with right to work
legislation.
I strongly encourage the government to work with the provinces
on the issue of education. Our education system needs to be
revamped radically in order to provide our young people with the
opportunities they will require in the future. I could go on at
length about the education system. I hope I will have an
opportunity later in the day to talk about that.
[Translation]
Mr. Pierre de Savoye (Portneuf, BQ): Mr. Speaker, this bill
replaces the Small Business Loans Act in order to reform the
Small Business Loans Program. The purpose of the program is to
increase the availability of financing for businesses with gross
annual revenues of up to $5 million.
This bill is aimed at increasing the availability of financing
for the establishment, expansion, modernization and improvement
of these businesses by allocating, between the minister and
lenders, portions of eligible losses incurred by lenders in
relation to loans of up to $250,000 to such businesses for those
purposes.
The government will continue to be liable for 85% of the losses
on loans not repaid, with the rest being the lender's
responsibility. The financial conditions regarding the loans
remain the same, that is 3% above the prime rate for variable
rate loans, and 3% above the mortgage rate for fixed rate loans.
The bill provides for the continuous operation of the program
subject to a comprehensive program review every five years. It
limits the minister's aggregate contingent liability to $1.5
billion for each five-year period. As for the department, it does
not have to compensate lenders for losses incurred when its
total contingent liability for the loans exceeds $1.5 billion in
a five-year period.
The bill also authorizes the minister to conduct compliance
audits and examinations.
A whole new series of measures are included in the legislation
to provide for the audit and examination of various reports to
verify that this act and the regulations are being complied with
in respect of a loan, including that the lender has exercised
due diligence, as provided in the regulations, in the approval
and administration of the loan.
The bill before the House authorizes the establishment and
operation of pilot projects to determine whether the program
should be extended to include loans to the voluntary sector and
capital leases. The minister's maximum aggregate contingent
liability in respect of each project is provided by an
appropriation act or another Act of Parliament. The pilot
projects have a maximum duration of five years.
1235
Also, the bill reforms the offence and punishment provisions.
Anyone found guilty of an indictable offence is liable to a fine
not exceeding $500,000 or to imprisonment for a term not
exceeding five years, or to both. However, anyone found guilty
of an offence punishable on summary conviction is liable to a
fine not exceeding $50,000, where it was only $1,000 previously,
or to imprisonment for a term not exceeding six months, or to
both.
The bill also provides for a comprehensive review of the program
every five years, in consultation with Parliament.
After this brief overview, I would like to address the crucial
issues underlying Bill C-53.
The Small Business Loans Act is crucial to small and medium size
businesses. Since these businesses are the engine of our
economy, Bill C-53 deals not only with issues directly related
to small business, but also indirectly with the issues of job
creation and productivity.
We all know how important small businesses are to our economy. A
few figures tell all there is to know: in 1995, when the most
recent recession hit us, small businesses with fewer than 100
employees accounted for 99% of the 935,000 businesses in
operation in Canada. These small businesses employed 42% of wage
earners in the private sector and paid 38% of all wages and
salaries.
However, small and medium size businesses are fragile. As a
matter of fact, nearly 15% of them shut down during their first
year of operation, and more than half of the businesses that
existed in 1989 were no longer in operation six years later.
Fortunately, the annual rate of new business start-ups exceeds
that of closures, allowing the renewal of this pool of employers
and jobs. In many cases, this high rate of closure of small and
medium size businesses is caused by insufficient credit. That is
why governments, particularly the Quebec government, are forced
to develop complementary programs.
Therefore, the Bloc Quebecois supports Bill C-53. However, we are
still disappointed by this review of the Small Business Loans
Act.
We had the right to expect certain things in this review of the
SBLA. For example, we had the right to expect provisions that
would give small and medium size businesses in Quebec and Canada
increased access to credit.
According to a survey conducted by the Canadian Federation of
Independent Business, 29% of small business owners say credit
availability is one of their main concerns. Moreover, according
to a survey of small and medium size businesses conducted by
members of the Bloc Quebecois in their ridings, 90% of them said
it was very difficult or difficult to obtain credit at a
reasonable cost. Only 10% said it was easy.
We also had the right to expect a program that increases credit
availability for those small and medium size businesses which
would not otherwise have access to financing.
In the same survey by Bloc Quebecois members, just over 50% of
businesses feel that the small business loans program ought not
to guarantee loans except those to small and medium-sized
businesses which would not otherwise have access to credit.
Finally, we would have been justified in expecting this new
legislation to give entrepreneurs the means of financing their
working capital so as to ensure the growth and development of
their businesses. In fact, 80% of small and medium-sized
businesses responding to our survey feel that the small business
loans program should also cover financing for working capital.
And what is there on this in Bill C-53? Unfortunately, nothing
that will make any further improvement to the situation of small
and medium-sized businesses.
1240
Bill C-53 does not improve small and medium-sized businesses'
access to credit. There is merely a change in the way the total
government commitment is calculated, but in actual fact no
increase. The main reason behind this revision is not the needs
of small and medium-sized businesses, but the accounting concerns
of the government, unfortunately.
Bill C-53 does not make it possible to provide funding to
businesses which would not otherwise have access to funding. By
focussing its reform on accounting concerns, the government has
not included in its assessment the macroeconomic effects of the
loan guarantee program.
It is in fact taking a step backwards in terms of the Small
Business Loans Act by strengthening the requirement for
diligence by the banks in according loans under this program.
In fact, small and medium size businesses that cannot find
financing with the banks should not expect things to be better
under this program.
There is also no mention of financing of working capital for
small and medium size businesses. There is no provision on this
in the bill, not even in what has been called the pilot
projects. However, small and medium size businesses have
clearly expressed their needs in this area. For these reasons,
the Bloc Quebecois has proposed amendments to make a law that
truly serves small and medium size businesses.
We want the good news for these businesses to be more than just
the fact that the loans program is extended, we want it to be
the fact that it is improved too.
This is the aim of the Bloc Quebecois amendments, which attempt
to respond to the major shortcomings we have noted.
More is needed than simply tightening up the old legislation.
The Bloc Quebecois considers that the proposed changes in
accounting require an examination of the need for economic
development. These vital amendments are being proposed for
reasons of economic development and job creation.
We are proposing an initial amendment to clearly establish the
aim of the bill. Insufficient funding, in a way, is worse than
none at all, because the business cannot develop as it might,
and, more importantly, as it should. This amendment therefore
is intended to clearly define the program so it may providing
financing to SMBs.
We have other amendments as well, and I will leave it to my
colleagues to tell the House about them.
[English]
Mr. Jason Kenney (Calgary Southeast, Ref.): Mr. Speaker,
I am pleased to rise in debate today on Bill C-53 with respect to
Motion No. 1 which was put forward by my hon. colleague from
Mercier, that the purpose of this act is to increase the
availability of financing of small businesses, which would not
otherwise have access to financing.
Let me make it perfectly clear at the outset what my caucus
colleagues have already said. The official opposition strongly
supports small business, the principal job creator and generator
of economic activity in this country. There is simply no doubt
about that.
I suspect that probably a majority of the members of our caucus
have had direct involvement in small business or are small
business people and understand the kinds of challenges that small
business people face. I think it is something members of all
parties in this House share. We all understand that small and
medium enterprises without a doubt over the past 20 some years
have been by far the major creators of jobs, prosperity and
incomes.
The question we must really ask ourselves is what is the most
effective policy that the government can adopt to promote the
growth of small business. There are really two basic approaches
that can be taken.
The first approach is for the state to intervene and to take
money away from people through taxation and in so doing to
destroy their profit incentive, to destroy their efficiency and
to destroy the potential creation of jobs in order to finance
government support schemes like the Small Business Loans Act loan
guarantees. That is one approach. It is an approach which the
Liberal Party, the government opposite, generally supports.
The other approach is to say that government ought not to be in
the business of picking winners and losers but that business
people ought to be allowed to do business without extensive
interference by government by means of taxation, regulation and
legislation.
1245
That is essentially the approach that we in the official
opposition support. For that reason we oppose the amendment and
the bill because they go in exactly the wrong direction.
What we need rather than sarcastic comments from colleagues
opposite is a vigorous policy which will unleash the unrealized
dynamism of small and medium Canadian entrepreneurs. There are
hundreds of thousands of jobs waiting to be created in Canada
today if only federal and other levels of government would get
out of the way of people who are struggling to create employment
through small business but are unable to because we face some of
the highest tax rates in the developed world.
We face them in payroll taxes, in capital gains taxes, business
taxes and property taxes. Canada has among the highest property
tax rates as a percentage of our GDP in the entire OECD. We face
them in income taxes. We face them in sales taxes.
Ask small business persons in the country and they will say they
have become for all intents and purposes unpaid tax collectors
for the government. They have to collect the GST. They have to
fill out endless forms for the same GST which the government said
it would abolish.
Give them tax relief so that small business persons realize
benefits after having spent their entire lives risking capital,
their life savings, pouring endless and incalculable value of
sweat equity into their businesses. The government at the end of
the day tells them that after all they have poured into the
businesses, all the jobs created, all the risks taken it will
take one third or more of the capital gains of small businesses
through the pernicious, destructive, job killing capital gains
tax.
If the government were really concerned about creating a growth
environment for small business and job growth through small
businesses it would stop playing around the margins with this
kind of state intervention, this kind of $1.5 billion taxpayer
liability through the small business loans guarantees. It would
stop bureaucrats picking who are going to be winners and losers
in the marketplace and it would let entrepreneurs be
entrepreneurs, invest in their businesses and reap the rewards.
Imagine that.
Let me utter a word which may be unparliamentary, profit. It is
a good thing. I know my colleagues opposite think it is a dirty
word. They do not like the words profit driven. That sounds
like an American concept. We in Canada do not like profits. We
like the bureaucrats absorbing those profits because members
opposite think they know better how to spend those profits
accumulated through taxes than do the small business people who
pay them.
This is the choice we face in the bill and in all the fiscal
decisions we make here. It is whether the bureaucrats and
politicians know better how to pick and choose winners and losers
among the hundreds of thousands of small businesses in the
country or whether consumers and business people themselves know
best how to create the conditions for growth.
We say unequivocally and unapologetically that we like the
profit motive. It creates wealth, businesses and jobs, and we
know that the kind of tax burden imposed by these tax happy, tax
and spend Liberals is exactly what destroys the conditions for
growth.
I would like to speak to many of the interest groups that
represent small business and various associations that appeared
before committee in support of Bill C-53. Let me be honest. It
is a constituency I am very sympathetic toward. Many of them
appear before committee and parliamentarians and say they want
tax relief but they also want all these loans, grants, guarantees
and diversification programs.
My message to those advocates of small business is for them to
make a choice. Do they prefer tax relief as the principal policy
for small business or government intervention?
1250
After all my experience and after having spoken with thousands
of small business people, I believe that ten times out of ten the
majority of small entrepreneurs will say they prefer tax relief
to government intervention, the kind contemplated in this bill.
There is no doubt about it. We cannot have both.
The small business community and its institutional voices need
to choose which direction they want to take. The only way
parliament and the government will deliver the meaningful,
creative and dynamic tax relief we need is if we get government
spending under control. The place to start and the first element
of government spending which should be reduced or eliminated is
direct government support for business, whether it is through
grants or loans or guarantees. Maybe it is radical but I believe
that a dollar left in the hands of a small business person is
several times more effective, efficient and productive than that
dollar taken away, circulated through a costly bureaucracy and
spent by a bunch of politicians.
We have to look at the experience in the country to see which
basic policy option works. We need to look at the experience of
my home province of Alberta where we have maintained the lowest
tax rates, no sales tax, the lowest small business tax rates and
the lowest income taxes. We have unbelievable economic growth
there. Let us cast our eyes to some of the eastern provinces
where there have been very high degrees of government
intervention, subsidies, loans, grants and guarantees for
businesses. What we see are stagnant growth rates and high
levels of unemployment.
The economic record is there for all to see. That is why I call
on all my colleagues to oppose this motion and this bill.
[Translation]
Mrs. Suzanne Tremblay (Rimouski—Mitis, BQ): Mr. Speaker, I rise
today to speak on the amendment moved by my hon. colleague for
Mercier during debate on Bill C-53, an act to increase the
availability of financing for the establishment, expansion,
modernization and improvement of small businesses.
My colleague's proposed amendment reads as follows:
That Bill C-53 be amended by adding after line 22 on page 2 the
following new clause:
“2.1 The purpose of this act is to
increase the availability of financing to small businesses, which
would not otherwise have access to financing.”
To be better prepared to speak on this bill, I asked that a poll
be conducted in my riding of Rimouski—Mitis. Nearly 300 small and
medium size businesses responded, answering a dozen or so
questions to help us get a picture of their situation on a
day-to-day basis.
Certainly, we would have hoped for a rate of participation
higher than 25%, but we must understand that, generally
speaking, small businesses and extremely small businesses often
do not have enough staff available to respond to all such
inquiries. Much of their time is apparently taken up by
mandatory paperwork; so, more often than not, when they want to
participate in a democratic process like this poll, they do not
have the time or staff to do so.
Something interesting came out of the information we gathered.
More than 55% of the small businesses in my riding have been in
operation for over ten years; 15% have been in operation between
six and ten years; 25% between two and five years, and about 5%
less than two years.
1255
It is also interesting to note that 50% of these businesses are
managed by men, 20% by women and 30% jointly by men and women.
The number of small businesses started by women keeps growing.
In fact, where previously 14% of small businesses had been in
operation for more than 10 years, nowadays 32% have been in
operation for less than 2 years. What this means is that women
are setting up more and more small businesses, which in turn
create jobs.
Small businesses are a major source of job creation and economic
development in our regions.
Respondents were asked how easy it was to get financing, based
on their opinion or experience or that of their neighbour.
Eighty-five per cent of them stated that it was difficult or very
difficult to get financing at a reasonable cost, based on their
own experience and that of other small business operators.
For those that said it was difficult or very difficult to obtain
credit at a reasonable cost based on their own experience, we
checked to see if there were striking differences between their
perception of their own situation and their perception of the
situation of others. Ninety-one per cent of respondents thought
the situation of others was the same as their own or worse.
Moreover, 68% of business owners who said it was easy to obtain
credit, based on their own experience, thought it was more
difficult for other owners.
We were intrigued by one thing in particular. Knowing the
importance of small business to the economy of both Canada and
Quebec, the government is now proposing to amend the existing
act.
Unfortunately, 70% of respondents to our survey—naturally we do
not want to make any generalization—said they did not know the
act that is being amended.
Three questions dealt with the credit needs of small business
owners. Question 6 sought to determine if the act should be
accessible to all small businesses or only to those which could
not otherwise obtain credit.
In the first instance, the legislation would apply universally,
whereas in the second instance, it would be a last resort.
Question 7 dealt with the notion of risk associated with the
type of business or the type of project that needs financing,
which has a direct impact on the level of risk guarantee
provided under the act.
Should the act help businesses without taking into account the
level of risk involved or apply only in cases where the level of
risk is considered reasonable?
Finally, question 8 asked the opinions and the needs of
entrepreneurs regarding the purpose of the loan guaranteed under
the act.
1300
In this connection, ought the bill to guarantee only loans on
equipment, real and personal property, or ought it to also
include the working capital of a business?
Sixty-two per cent of our respondents felt that all small and
medium-sized businesses ought to be able to avail themselves of
the legislation, regardless of whether or not they could borrow
money in other ways, or fund their projects in other ways,
unlike the present situation, which limits access to only those
which would not otherwise have access to funding.
When we see that a sizeable number of women are launching
businesses of this type, one is entitled to expect a degree of
openness in this area, since it is without a doubt almost
universally recognized that women generally have far more
difficulty than men in obtaining credit.
On the other hand, 91% of owners believe loans guaranteed under
the act should be made only if the risk presented by the company
or its plan is a reasonable one. This shows how wise the people
in my riding are, as they call for a more universal opening-up of
credit, as well as for guidelines and for only reasonable
projects to be funded.
In this research and in the responses that came from our
constituents, we also found out some very interesting things
about the reasons small and medium-sized businesses succeed or
fail.
I will probably have a chance to speak again in this debate in
order to provide more detail on the points of view expressed by
the men and women in my riding.
[English]
Mr. Deepak Obhrai (Calgary East, Ref.): Mr. Speaker, it
is a pleasure to rise today to speak to Bill C-53. My colleagues
mentioned some relevant points earlier as to why we are opposing
the bill, especially my colleague from Calgary Southeast.
Members of the Bloc have been talking this morning about the
survey they have done and the feedback they have received from
small businesses. Those are the bases of their argument. I have
been running a small business for the last 15 years and what I
will say is based on experience.
Small businesses, as we have heard constantly, are facing
financial crunches. Access to credit for them is very difficult.
Bankers present an opposite view, that they are working very hard
to give access to small businesses.
On one hand we have constituents complaining. On the other hand
the financial institutions are saying that they are doing a great
job. Something is not right. Let me tell the House why it is
not. From my experience banks do not understand small
businesses. That is the bottom line.
For the last 15 years I have been in business I was afraid to go
to the banks to ask for money. This fact has been recognized,
but we cannot stop entrepreneurial spirit. That is the strength
of Canada.
What have they been doing? They have been using other means.
Even the banking industry admits that they are accessing credit
cards at high interest rates. They are accessing from their
friends at high interest rates. Why? It is because banks have
not fulfilled their needs, irrespective of what promises they
have given.
As usual, the government that wants to say it is doing something
comes up with a program for giving guarantees so that small
businesses can access funds.
The program has been there for the last 25 years. Why are small
businesses still complaining that they cannot access credit
despite the fact that the same legislation we are talking about
has been in existence for the last 25 years? It makes us wonder.
Obviously there is something wrong. My colleagues have already
mentioned what is wrong. The high cost of doing business is
killing small businesses.
1305
In the last 15 years I have been a small businessman I
identified two costs that have been rising. Profits have not
been rising. Competition is coming, but two costs have been
rising. One is anything to do with the government, the
bureaucracy. That is one of the single highest costs that is
rising: taxation, user fees and government paperwork.
The second is the cost of doing business with the banks. Banks
have many means of raising their charges to small businesses.
There are straightforward service charges. They come along and
tell them the service charges, but there are costs associated
with overdraft privileges and high costs associated when cheques
bounce, which is not their fault in any event. This is a huge
burden. The economic climate of high taxation, bureaucratic
interference and paperwork is killing the spirit of
entrepreneurship. As my colleague said, it hits directly at
profits.
The government said that it would abolish GST and we are still
waiting for it to do it. I know from experience that small
businessmen are paying GST from their profits. It comes out of
their profits. The government may want to say that the consumer
is paying it. Yes, the consumer was paying it, but businesses
had to reduce their profit margins in order to accommodate that.
In principle I feel the bill is a great bill. It is there to
help small businesses. It sounds excellent. The government says
“Here is the money. We will guarantee it and the banks will run
it. You can access it”. As I mentioned, we keep hearing that
small businesses are having problems and the government is doing
the same thing again. We have a problem.
In his report the auditor general identified the problem. It is
abuse by both borrowers and lenders. Lenders look at it as
another way of making money without taking any risk. Who is at
risk here? Small businessmen are already at risk when they apply
for loans and the Canadian taxpayer is also part of it. There is
a double risk. The banks are have absolutely zero risk.
When banks look at applications that come before them they ask
why they should take any risk and they transfer it to the
government program. They are fine; the chapter is closed. Once
in a while they will take care of it. If they do not get it from
the program they can get the money from the bank. That is a very
simple statement. There is no initiative. There is no incentive
for banks to work in co-operation with small businesses when
taxpayers' money is at risk.
While the bill in principle may be right, it is not the way to
go.
The way to go is to create the environment, economic conditions
for small businesses to succeed, and they can succeed without
government intervention. Canadians have far more
entrepreneurship and are far more willing. They do not need the
government telling them what to do.
1310
In talking to people outside this country time after time they
make the point that they do not want to come to Canada to invest
because our payroll taxes are very high. The business climate is
not here. Instead of coming forward with band-aid solutions, the
first priority is to work toward creating an economic climate in
which small businesses can thrive, an economic climate where even
the banks will understand that they have a role to play.
I appeal to the banks that will be running this program to take
the interest of small business people into account. They have
done a terrible job in the past. They should improve.
Mr. Rob Anders (Calgary West, Ref.): Mr. Speaker, I will
read the intended purpose of act and then tell the House its real
purpose:
The purpose of this act is to increase the availability of
financing small businesses which would not otherwise have access
to financing.
That gets to the whole point of it. If its purpose is to
increase the availability of financing to small businesses,
should it be done by legislating it or by regulating it? Maybe
some members across the way or other colleagues in the House
think it works that way, but just because it is legislated or
regulated does not make it so.
The problem for small businesses is not that they do not have
the ability to acquire more debt. Their problem is that they do
not have enough equity. The government continues to raise their
taxes. It likes to talk about how small business is the backbone
of job creation, but since it took office in 1993 there have been
40 tax increases. The government is breaking the backbone of
business. The Liberals are taking baseball bats to the backbones
of small businesses.
Let me talk about how many different baseball bats the Liberals
have brought in. I will use the example of my home town of
Calgary, Alberta. Alberta has about 1.62 million workers.
Alberta pays into employment insurance to the tune of about $1.8
billion per year and only takes out $500 million. That leaves
$1.3 billion in the finance minister's coffers.
If we divide those numbers it is about $750 per average working
Albertan. That is money that is not in their wallets. That is
money that is in the finance minister's mountain high
overpayments in terms of the EI fund. That type of thing hurts
small business. I do not think that legislating and regulating
banks to try to give out more money is the way to do it. Why not
do a favour for small business rather than try to regulate and
legislate the banks? That is what small business wants.
If I were to knock on the doors of small businesses in my riding
I can bet dollars to donuts they would not say that the number
one thing they want from the government is more legislation and
more regulation telling them how to run their shops.
They would say they want lower taxes. That is what those
Liberals across the way do not seem to understand. They do not
hear that.
1315
This government said it was going to cut the GST. The
government said it was going to scrap, kill and abolish the GST.
But no, this government has left that type of shackling on
businesses in this country. This government said it would do
something about it and it did not do it. It was a broken
promise. The government does not like hearing about it, but it
is the truth, and the truth hurts.
If the sting and the venom of my tongue hurts the Liberals'
virgin ears, that is too bad. They need to hear the truth.
The GST was supposed to be scrapped, killed and abolished. The
Prime Minister promised so. The Prime Minister is on tapes right
across the land saying that he was going to do that if his
government was elected. But this government did not deliver.
This government fell short on that promise to small business
people in this country.
This government brought in 40 tax increases and its members
pride themselves on having balanced the budget. This government
does not like talking about the $24 billion more that it brings
in in taxes in this country. Taxes have gone up. The GST has
stayed. The government has raised CPP premiums and other payroll
taxes.
The Liberal government is milking small business people dry and
it talks about legislating and regulating banks. Shame on this
government. That is not the answer and this government knows it.
Why does this government not give taxpayers and small business
people in this country a break, rather than regulating them? That
is not the solution and this government knows it is not the
solution. For those members across the way who own small
businesses, they should know that is not the way to cure the
ailments of small business in this country. Small business is
not asking or begging for more regulation.
Let us talk about priorities. This government says it wants to
increase the availability of financing to small business. What
is this government doing about corporate welfare in this country?
Is corporate welfare somehow less important?
The government spends $4 billion a year on corporate welfare.
It gives money to its friends. I have certainly talked about
that with ACOA and other programs that go on under this regime.
It gives money to people who have given campaign donations.
There seems to be an interesting if not spurious correlation
there.
This Liberal government can find money for those things, but to
lower taxes we would have to twist the finance minister's arm and
break it at the wrist and the elbow.
This government does not talk about corporate welfare very much.
This government does not talk about the funding it gives to
special interest groups. Somehow that is more sacrosanct than
cutting taxes for small businesses. I do not think so.
The government gives money to crown corporations. It believes
that is more important than cutting taxes for small business.
Do members know that the CBC receives close to $1 billion a
year? It has been cut down a little, but at one point it was
$1.1 billion. Somehow that is more important than cutting taxes
for small business.
I see that some members are turning their tails and running.
The government has never come clean on this, but there are some
in this country who are questioning whether Canada Post is using
the money it gets from taxpayers for regular mail to
cross-subsidize its courier services, e-mail and other things
that it does in direct competition with Purolator Courier and
other courier associations and businesses in this country.
When we have the public sector competing with private sector
businesses, driving them out of business, eating up their
advertising, their revenue dollars and their clients, it is a
shame. This government happens to think that those types of
things are more important.
I would like to go through the 40 tax increases and the types of
things this government has brought in. It does not want to cut
taxes. This government wants to regulate and legislate instead
of getting to the whole problem of equity.
This government wants to give businesses more debt. We can bet
our bottom dollar on that. We are asking for a little more
equity. When people pay taxes they are incurring debt. If they
have a debt already and they are paying more, they have to take
on more debt.
1320
I bet this government would like to give them more rope to hang
themselves by. I bet the finance minister gloats over the $24
billion more he has taken in since 1993. The finance minister
and the rest of the Liberals love lining the government's pockets
and building up hordes of money.
I am going to go through some of these tax increases that seem
to be more important and more sacrosanct than cutting taxes for
small business. Instead, the government is proposing legislation
and regulations so that businesses have more rope to hang
themselves by.
The government put a tax on life insurance premiums and extended
it. What has that brought in? In the 1994-95 budgetary year it
brought in $120 million. It then got worse. One would think
$120 million in terms of tax on life insurance premiums and the
extension was bad enough, but it went up to $200 million, $80
million more.
This government is all about taxing life insurance premiums. It
is not about cutting taxes for small business.
What else is the government into? It is into income testing for
age credits. One might ask how much money that has brought in.
In fiscal year 1994-95 it brought in $20 million. In the year
after that it brought in $170 million. By the time we got to
1996-97 it brought in $300 million. Taxes keep going up and up
with this Liberal administration, but I do not hear about it
cutting taxes, lessening regulations and legislation. That is
the way it knows how to solve problems.
This government also went ahead and made changes to the tax
treatment of securities. For every single one of these five
years it has brought in $60 million more per year, for a total of
$300 million.
I realize that my time is up. I could go on and on. The
solution is not to legislate and regulate to provide capital to
businesses, it is to cut their taxes.
Mr. Gary Lunn (Saanich—Gulf Islands, Ref.): Mr. Speaker,
I am pleased to speak to the Bloc's Motion No. 1 and also to
defend the interest of small business for the business people of
Saanich—Gulf Islands and all of British Columbia.
I too will read the proposed motion:
The purpose of this Act is to increase the availability of
financing of small businesses, which would not otherwise have
access to financing.
Obviously they are at considerable risk.
I want to talk about the business climate in British Columbia.
It is in an absolute crisis situation. No matter who I talk to,
people are losing their homes and their jobs by the thousands
every day in Prince George, Cranbrook, Duncan, Lumby, Terrace.
Mills are shutting down. Every other day on the news we see
another mill shutting down. Some have suggested we will lose
another 10 by the end of the year. No matter who I talk to in
these communities, they feel the largest single contributing
factor for these job losses and their lives being devastated is
government regulation.
Yes, there is provincial government regulation, but there is
also federal. As these whole communities are being devastated,
the small businesses are being driven out of business as well.
That is what this government needs to focus on. It has to create
an economic climate in this country and in British Columbia for
these businesses to be competitive and to succeed. That is not
happening.
This program is not helping small business. When I speak to the
small business people in these communities, they tell me that
they are overburdened by government regulation. Small business
people in my community tell me they get government forms every
other day in the mail. If it is not a GST report they have to
fill out, it is a report from the Workers' Compensation Board for
premiums, or a report for Canada pension plan premiums. The list
goes on and on and on. It never ends.
These small businesses are absolutely burdened with bureaucracy.
That is what we should be focusing on to help these small
businesses.
1325
As my colleagues have said, it is the responsibility of this
government to create an economic climate so that small businesses
can succeed. It should not be raising taxes 40 times over four
or five years. It should not be raising payroll taxes.
Government members like to stand and say “We have reduced EI
premiums more than the Conservatives did”, but they do not tell
us that they doubled Canada pension plan premiums.
This is choking the small business community. What does the
government do? It says “We will bring in $1.5 billion. We will
be out there to champion the small business community. We will
make this money available”. Government is not telling us that
this is a huge liability for the taxpayer.
The purpose of this legislation is to help businesses which
would not otherwise have access to financing.
If we ask anybody in the business community what that means they
will tell us that these are high risk businesses which probably
will not make it.
Why is that? There are probably some poor business plans that
are not going to succeed, but a lot of them could if this
government would tackle the real problem instead of just trying
to put a band-aid on it, thinking it will go away. That real
problem is reducing government bureaucracy and creating an
investment climate for people to come in and take hold. That is
not there.
I cannot emphasize this enough. I speak to small businesses in
my community. They employ two or three people. They show me the
government forms they receive. They have to hire a full time
accountant just to look after their bookkeeping, to handle the
government bureaucracy and all the different forms from all of
the different departments.
They are not just getting them from the federal government, they
are getting them from the provincial government. The list goes
on.
It was ironic. I did a radio talk show in my riding. A
representative of the federal Liberal riding association came in
and said “Mr. Lunn is against small businesses. He does not
support the Small Business Loans Act”.
What a pile of hogwash. They do not understand the problem.
They think that if they throw money at it the problem will go
away.
After spending a year in this House the one thing I have learned
from this government is that it thinks that if it throws money at
a problem it will go away by itself, without it having to attack
the real source of the problem.
I would like to emphasize what is going on in British Columbia.
It is in a crisis situation. If we go to any of the interior
communities we will see people losing their livelihoods. They are
losing their homes. Why is that? It is because governments,
both federal and provincial, have created a climate through
government bureaucracy and policies in which these companies
cannot survive.
The spinoff, the rippling effect, the number of small businesses
that are closing is staggering.
Let us take the example of the softwood lumber quota. The
province of British Columbia has lost it through government
regulations. It is struggling to export its product. It is
forced into quotas by this government because of more
bureaucracy, more government regulations, more paperwork.
Members opposite can shake their heads, but these are facts. I
invite any member of the government to go out to British
Columbia, go to the small communities and to talk to these
people. Hear it from them. Look at the devastation that is
happening out there and then come back here and say “We need
more than just $1.5 billion to throw at people with business
plans who otherwise could not get financing from anywhere else”.
We have to do something for these people. What we see is
absolutely not acceptable.
1330
I think it is a disgrace that I have to look at this legislation
in the House and then go back to the people of British Columbia
and say this is what the federal government is doing for you.
They will say that I am their federal member. I shake my head
because these people are so frustrated. What are they going to
do? There are real problems out there. We need to start
attacking the root of the problems.
I will repeat that the government's responsibility is to create
an economic climate in which businesses can thrive, profit and
provide employment without government subsidies and taxpayer
liability. We are not doing that, although it is our role in
this House to do so.
Mr. Darrel Stinson (Okanagan—Shuswap, Ref.): Mr.
Speaker, I rise to discuss Bill C-53 and Motion No. 1 moved by
the Bloc. I will continue on from where my hon. colleague from
Saanich—Gulf Islands left off in regard to what is happening
today with small businesses and so-called small business loans.
The government is trying to infuse more money into a very bad
situation. I have listened to some of the speeches today. Some
members across the way have said how much they have done for
small business, yet in the history of Canada the small business
bankruptcy rate has never been so high. How much help has this
government given small business? Why is our system not working?
This program is already in place and the Liberals want to throw
more money into it. They know full well that it will not create
a better climate for small business, that it will not help the
entrepreneur go ahead. Canadians are overregulated and
overtaxed.
Last winter between Christmas and New Year's Day, I had a chance
to get away with my wife for a few days. We decided to drive
down to the coast of Oregon. A small business conference was
going on there. I met a couple of mayors and a bunch of council
people from Lincoln, Oregon. We got talking about the difference
in business attitude between down there and up here in Canada.
They told me of six new companies that had started during a
two-week period. They were started by Canadian entrepreneurs who
had been chased out of this country by this government.
Members on the other side ask about the American economy. It is
coming from our Canadian entrepreneurs who have been chased out
of this country. They have been chased out by those people, the
government and its overtaxation and overregulation. Do Liberal
members think those entrepreneurs are happy there? Do Liberals
think those people want to invest $50,000, $100 million or $200
million in this country? They do not. They have no confidence
in the ability of this government to help them survive in this
economic climate.
Liberals stand up day after day to say how great they have been
to Canadian businesses. Let us take a look. There have been 40
increases in taxation since the Liberals have been in power. I
will say it very slowly for those on the other side. That is a
four with a zero at the end in tax increases. And the Liberals
say they are the great saviours of the Canadian business climate.
Shame on them. Shame on them for even standing up and saying
that. It is total hypocrisy.
This government is like any government before it, like the
Conservative and Liberal governments before it: “We will throw
more money out there to make us look good. We will have
something to throw out there so we can say this is what we tried
to do although it did not work. We are so sorry it did not
work”. Governments have been trying this from day one in Canada
and who has been paying for it? The taxpayers, those who are
sitting outside this House, those who are sitting up in the
gallery. They are the ones who pay for it.
The Liberals sit on the other side and think they have money.
They think they have their own money but they do not.
The Liberals have the people's money. They have the workers'
money. Look after it for a change. It is total hypocrisy.
1335
The Liberals campaigned that they would get rid of the GST and
they would help businesses. They said they would scrap the GST.
What did they do? They came along with a better idea, a bigger
scam on the people of Canada. They would harmonize the GST. The
cost went up another 3% through harmonization. Nice going Mr. and
Mrs. Government on the other side. Shame on them. They cannot
justify the 40 tax increases, so they will not mention them. They
cannot justify any of them. They would sooner have a bill like
this one which adds $1.5 billion more to try and address the
problem.
The problem has been there since the day the program started.
People come to my office time after time wanting to know how they
can access the money that is supposed to be there for small
business loans. It is not there. Most of them would be far
better off going to their families and keeping the government and
its regulations out. What kills business is taxes and
overregulation.
If this government really wants to do something for the
entrepreneur, for the business minded people, if it really wants
to keep them in this country and not chase them across the line
or to other countries like it is doing today,—it is called the
brain drain—then start cutting the taxes. Get out of their
faces and let them go ahead and compete. Get rid of the
interprovincial tax barriers. Start treating Canadians as human
beings instead of digging into their pockets and taking their
money any time it feels like it.
Mr. Eric Lowther (Calgary Centre, Ref.): Mr. Speaker, I
am so pleased to follow my colleague now that he has the
attention of some of the members opposite. Hopefully they will
listen to the continuation of the well reasoned arguments that
our party has put forward.
I am troubled by this motion as I know many constituents are. It
is such a sad reflection on the lack of leadership on the other
side. The best the government can do is to put forward a bill
that puts the struggling small businesses further in debt and
offers them no possible relief or hope. This is not the way to
increase the viability of small businesses in Canada. If they
were more viable, lenders would be lining up to make sure money
was available to them. This kind of motion makes it all that
much more difficult.
Why are small businesses having such a hard time? A number of
small businesses in Calgary Centre have spoken to me over the
past year and they have listed their concerns. Never have they
come to me to say that they need more access to loans to get them
further in debt. Every priority they have presented to me has
related to taxes, taxes and taxes. They listed the property tax
they pay and how high it is. They listed the provincial taxes
and the income taxes. The most painful of all is the payroll
taxes. It is particularly painful when they see, hear and read
about a surplus they and their employees have paid into but they
will not be given any relief in that arena by the finance
minister.
Particularly troubling to me was one small business owner, an
elderly fellow. He and his wife ran an electronic shop. He
showed me on paper that he could actually make a profit but after
paying taxes, he was in a losing position. He lost money because
of his taxes. It is tragic especially when we sing the praises
of small businesses being the engine of our economy and then we
tax them into bankruptcy. It is tragic.
1340
We have heard previously from members today about the rate of
bankruptcy in this country. Is this the best solution we can
come up with for businesses that are going bankrupt? We are going
to make the availability of more financing that they would not
otherwise have access to drive these businesses that are carrying
the tax burden further into debt through government loans. Is
that the best we can do?
Certainly that seems to be the best members on the other side
can do, but that is not why we are here. We are here to see that
these small businesses become successful and to give them some
tax relief. This component of our business community should be
the first to receive tax relief.
The president of the Restaurant and Food Services Association in
my riding has come to me more than once. He has written to me.
He has never asked for access to more financing. Each time what
he has asked for is relief from taxes. He has pointed out to me
that the restaurant business is where many young people in our
country get a start. They learn how to work within a company,
serve and build their job skills. Yet restaurateurs are so
burdened by payroll taxes that many of them are limiting the
number of young people they hire and this is where our young
people get a start.
At the other end of the spectrum, many professionals and people
trained in our universities who venture out in small
entrepreneurial enterprises carry the weight of a mountain of
bureaucratic red tape and the tax burden. That is one of the
factors why this country is faced with a brain drain. Educated
professionals look at the options and ask do they stay in Canada
or do they go somewhere where their efforts are going to pay a
dividend. It is not here that they choose to stay.
We are asking that we get serious about some real solutions for
small business. It comes from a climate that allows small
businesses to succeed, not to get further into debt, a climate
that allows them to make a profit. Some members in the House do
not like to hear the word profit. Allow small businesses to make
a profit, to reinvest it back into their companies, to expand, to
employ more Canadians. Keep more Canadians here, young
Canadians, instead of driving them across the border because of
the heavy burden of taxes and government red tape.
No, that is not the answer. We need to show leadership in that
area and it is leadership that is sorely lacking. That is why we
are so concerned about this particular motion today and this
bill. It so typifies that lack of leadership.
Let me also point out that our country has the highest tax rate
in the G-8, which is something we have mentioned before in the
House. Canadians are starting to hear it. We hear the finance
minister talking about surpluses, yet he is refusing to give
Canadians the tax relief they deserve.
We have seen the vibrancy in Alberta. Why? Because Alberta has
one of the most positive climates in Canada for entrepreneurs and
business people to succeed. People are moving to Alberta and
they are succeeding in Alberta. But the Liberal government
refuses to take that as a lesson and allow for that kind of an
environment to flourish in the rest of the country.
I refuse to accept the statement some would make that the
success of entrepreneurs and businesses somehow means that those
who are underprivileged or who are in need would be left out. My
very own riding of Calgary Centre, the vibrant community of
Calgary, in some ways is becoming the new business capital of
Canada. I would say that the charities, the concern and the
caring in that community is second to none in Canada.
It does not follow that just because there is business success
somehow that means the underprivileged are forgotten. I put
forward the strong example of Calgary Centre, my own riding where
just the opposite is true. When there is success in business and
the economy is strong, the needs of the underprivileged are cared
for that much better than when business is struggling and under a
heavy burden of tax.
1345
We are so concerned about the lack of leadership on this issue
shown by the government. It is so important. That is why we have
made mention of this. We are making a point to bring this to the
attention of the people in the gallery, those watching and
hopefully the few members opposite who are listening.
My closing appeal for the young people of the country, the
families that want to have a future, stay in Canada and have an
opportunity to grow, raise a family and be strong contributing
Canadians is that on their behalf instead of a weak approach of
putting businesses further in debt that the government,
parliament and all of us be committed to strengthening the
economy through lower taxes, less government regulation and let
the Canadian people flourish and build a stronger country.
Mr. Werner Schmidt (Kelowna, Ref.): Mr. Speaker, it is a
privilege to follow an as erudite and eloquent speaker as the
member for Calgary Centre. Was that not a thrill to listen to
him advocate on behalf of our young people, small businesses and
to encourage the entrepreneurship of those who are aspiring to
become big businesses? That is tremendous. I congratulate my
hon. colleague who presented a very balanced view of what is
happening in Canada.
I will talk about the entrepreneurship that is so characteristic
of small business people. The people who start small business
are entrepreneurs in the absolute and best sense of the word
because the entrepreneur is someone who takes his own initiative,
motivation, ideas, learning, skills and abilities and applies
them in a way that will make him some money, that will allow him
to express himself, to get that self-actualization to the fore so
that he can become that respected member of the community.
Entrepreneurs are the very people who are the most charitable in
giving their time, money and skills to the community. Recently we
had a fundraising dinner for the cancer clinic in Kelowna. The
fundraiser was populated by primarily small business people.
What did they do? Ninety of these small business people raised
$90,000 in one evening for the Kelowna clinic cancer centre. Is
that not something to be proud of? I think that is wonderful and
we should congratulate them. Those are the very same people who
stand behind the United Way and have helped build the social
conscience among the members of the community. Those are the
kinds of people who have that have the spirit and drive that says
I want to help myself and I want to show the aggressiveness and
the way in which I can build a better community. That is what
those entrepreneurs and small business people do.
That is not all they do. They are the source of most new jobs,
with 85% created by small business people. Is that not something
we should reward?
If that is the case perhaps this is a really good amendment
because it is supposed to help small businesses. The interesting
thing is that it says the purpose of the act is to increase the
availability of financing of small business which would not
otherwise have access to financing.
If that is the purpose then I want to ask what has the
experience been. There was a Small Business Loans Act which had
a purpose very similar to this one but how did it actually work
its way out? In many instances the financial institutions
recognized that if they would grant a loan under the provisions
of the Small Business Loans Act they would be able to collect a
better interest rate and besides that they were absolutely
assured that the loan would be repaid regardless of what happened
to the business.
If that does not sound, smell, taste or look like a subsidy to
the financial institutions I would like to know what it is.
I think we had better really look at this carefully and say what
are we really doing here. Are we subsidizing those big banks that
had profits last year of $1.5 billion for one bank? They do not
need the subsidy. But the small businessman needs a break. He
does not want a subsidy. I have not heard a single small
businessman say to me they want me to get them a subsidy.
1350
What they say is “Give me a fair break so that I can compete
fairly, that I can compete honestly and so that I can apply my
skills in the best way possible. Reduce my taxes. Reduce the
intrusion of government in my work and do not give me subsidies.
If you give me a subsidy you are probably going to give my
neighbour a subsidy. But worse than that, you are probably not
going to give a subsidy to me and give it to somebody else and
that person is going to compete with me”.
I will give a specific case of a business that was doing very
well. It wanted to expand and did. It borrowed $250,000 to
expand the business, put a new product line in place and to make
it more efficient. What did the business discover? It discovered
that in another community that had the same market area as it
did, the government came in with a subsidy for exactly the same
business. Here we have an honest entrepreneur trying to compete
with this big mammoth, giant government which gave this person an
interest free loan. Is it any wonder that both those business had
problems? That is the kind of thing we want to avoid.
Small business is also the centre of most new ideas and
innovation. If we look back on the communication industry and
how it has flourished, where did it start? We can look all the
way back to Alexander Graham Bell. Where did he start? In big
business? He started as a tiny little business. We can go back
to the computer industry, back to the chips, back to virtually
any of these things that are happening today. Where did they
start? They started as small businesses. They did not start
with the Small Business Loans Act. They started not with a
special subsidy. They started because they had a good idea, they
had a few dollars and they put their enterprise to work. That is
how it works.
Does this mean I am opposed to small business? It is the exact
opposite of that. It gives small businesses the courage, the
enthusiasm, the support, the level playing field so that they can
compete fairly and squarely with other businesses so that the
best person can win. Let us face it, that is what we want.
It is government's responsibility to create a playing field that
is level, an environment that encourages distribution and
advancement, that builds on the talents and skills of the people.
That builds a nation. The strength of a nation does not rest
primarily on its natural resources. It rests on the motivation,
on the skills, the abilities and the knowledge of the people.
Because that is where it rests, it finds its greatest application
in small business. That is where we need to look.
This government should be ashamed that it gets in the way of
small business with its bureaucracy, gets in the way of small
business by not giving it the opportunity it should.
Let us encourage this government. It has done wonderful things
but there are some things it is doing that are wrong. That is
what has to be taken care of.
The GST should go. The government said once it was going to go.
There are all kinds of members over there who said it should go.
Did it go? No. It harmonized the GST, which costs even more
money. That is a disgrace.
What is it that we now need to look at with regard to small
business? New jobs. If there is one thing that would encourage
our young people, the graduates, more than anything else it is to
recognize that their skills, their abilities, their training will
result if a job.
Last summer I met with two university students, bright young
people. They came up with a truck and a trailer. On the truck
they had wheelbarrows, rakes and other tools. On the trailer
they had some lawnmowers and other gardening equipment. I asked
them what they were doing.
They said they got a little loan and bought this equipment and
were in business. Guess what happened. At the end of the summer
they had paid off the loan, paid for the equipment and saved
enough money to pay for their next year's tuition. They were so
proud of being able to build the business. They were so happy and
they are now putting that equipment to work during the winter,
getting ready for the winter clearing of snow and things of that
sort.
1355
This started because these young people had some skills and
ability and could not find another kind of a job and so decided
they could help themselves. That is what this government should
be doing. It should encourage our young people.
It is a great world. Canada is a great country and that is what
we need to build on.
STATEMENTS BY MEMBERS
[English]
MIGRAINE
Mr. Tom Wappel (Scarborough Southwest, Lib.): Mr.
Speaker, I am pleased to inform the House that the week of
November 14 to 20 is migraine awareness week.
Over 3 million Canadian men, women and children suffer from the
pain of migraine, a debilitating neurological disorder which
costs the Canadian economy an estimated half billion dollars a
year.
The Migraine Association of Canada provides information and
compassionate telephone support to help sufferers manage this
disorder. The association is launching its third annual campaign
to increase awareness of the serious nature of migraine.
Volunteers across Canada will display information in workplaces,
community centres and schools to foster a greater understanding
of the symptoms of migraine and their effects on the sufferer.
Please join me in wishing the Migraine Association of Canada and
its volunteers a very successful migraine awareness week.
* * *
HEADSTART PROGRAMS
Mr. Keith Martin (Esquimalt—Juan de Fuca, Ref.): Mr.
Speaker, one year ago 14 year old Reena Virk was brutally
beaten to death in my riding by a group of teenage girls.
The Virk family, displaying enormous courage, turned its pain
into positive action supporting effective crime prevention tools
such as my private member's Motion No. 261 which passed in the
House of Commons in May and calls for a national headstart
program.
It focuses on strengthening the bond between parents and
children, particularly those between the ages of zero and eight,
so that children will have their basic needs met.
Headstart programs have decreased child abuse by 99%, youth
crime by 60%, teen pregnancies by 50% and saved $30,000 a child.
Headstart programs have also decreased the single leading cause
of preventable and irreversible brain damage, fetal alcohol
syndrome which plagues one-third of the people in jail.
An ounce of prevention is worth a pound of care and I call on
the government to act on the contents of Motion No. 261 and work
with the provinces to implement a national headstart program so
we will not see more deaths like Reena Virk's.
* * *
GUELPH—WELLINGTON COMMUNITY RADIO
Mrs. Brenda Chamberlain (Guelph—Wellington, Lib.): Mr.
Speaker, when most people want local, up to date news they tune
in to their community radio station. But the community radio
stations in my riding of Guelph—Wellington, CJOY and Magic
106.1, provide so much more than this. They play a crucial role
in building community spirit by promoting local events and
encouraging people to support local charities.
During last year's ice storm and again in the aftermath of
hurricane Mitch, CJOY and Magic helped to co-ordinate our
community's response, keeping us informed and telling us how we
could help. These are just two examples of the important role
local radio plays in my riding.
I thank CJOY and Magic for their dedication to our community and
for their generosity in donating free air time to local
organizations and charities. They are a big part of what makes
Guelph—Wellington the best place to live in Canada.
* * *
1998 GOVERNOR GENERAL'S LITERARY AWARDS
Mr. Peter Adams (Peterborough, Lib.): Mr. Speaker, the
1998 Governor General's Literary Awards were presented today.
These awards are given to the best English and French language
work in seven categories.
1400
This year's winners are Diane Schoemperlen, Christiane Frenette,
Stephanie Bolster, Suzanne Jacob, Djanet Sears, François
Archambault, David Adams, Pierre Nepveu, Janet Lunn, Angèle
Delaunois, Kady MacDonald Denton, Pierre Pratt, Sheila Fischman
and Charlotte Melançon.
Our thanks to the Canada Council for the Arts which administers
the awards and provides invaluable support to Canada's writers
and artists all year long.
I congratulate today's winners. All Canadians should be
immensely proud of the extraordinary wealth of literary
achievement and promise that exists in Canada today.
* * *
[Translation]
CANADA-FRANCE INTERPARLIAMENTARY ASSOCIATION
Mr. Yvon Charbonneau (Anjou—Rivière-des-Prairies, Lib.): Mr.
Speaker, on behalf of the Canadian branch of the Canada-France
Inter-parliamentary Association, it is my pleasure to draw your
attention to the presence in this chamber of a delegation of the
French branch of our inter-parliamentary association.
The French delegation is led by French branch chairman François
Loncle, the member for l'Eure, who is accompanied by fellow
member François Deluga and Senator Jean-Marie Poirier.
The purpose of the meeting our association's standing committee
is currently holding in Ottawa is to establish our schedule for
the coming year and come to an agreement on the next steps to be
taken in strengthening both the parliamentary and governmental
partnership and co-operation between our two countries.
* * *
[English]
RAILWAYS
Mr. Dale Johnston (Wetaskiwin, Ref.): Mr. Speaker, last
week while on route to an evening meeting in my riding I had to
stop quickly for a freight train crossing the road in front of
me. I felt fortunate that I had seen it for at night trains at
crossings not equipped with lights, bells or barriers tend to
blend into the darkness.
If all railway cars had markings on their sides to alert
drivers, many accidents could be avoided. Railways have taken
the initiative and are painting reflective strips on the sides of
their new cars and on cars that come in for repairs. The problem
is that in today's intermodal marketplace trains may be hauling
cars belonging to U.S. shippers or even the Government of Canada.
The government needs to make the safety of the motoring public a
priority. The Minister of Transport has the regulatory authority
to make reflective markings mandatory on all railway cars
travelling in Canada, and he needs to do it now.
* * *
[Translation]
HARRIS CANADA INC.
Mr. Bernard Patry (Pierrefonds—Dollard, Lib.): Mr. Speaker, I am
pleased to inform the House that, on November 9, 1998, Harris
Canada Inc. and the Government of Canada announced a $133
million investment in the Montreal and Calgary divisions.
The Montreal project entails a $9,861,900 investment by
Technology Partnerships Canada, as part of a global investment
of $72 million over four years. This is a project to develop
wireless point-to-multipoint broadband access systems, which will
make functions like high-speed Internet access and video access
accessible without wired components. This investment is expected
to generate 320 jobs in Montreal by the year 2005.
I should point out that, since 1996, Technology Partnerships
Canada has invested more than $300 million, which helped
maintain or create 3,875 jobs in the greater Montreal area.
* * *
[English]
HUMAN RIGHTS
Ms. Shaughnessy Cohen (Windsor—St. Clair, Lib.): Mr.
Speaker, I am pleased to rise in the House today to commend the
efforts of the Prime Minister and senior ministers in our
government for their steadfast approach to promoting human rights
at the APEC meeting in Kuala Lumpur.
I applaud the Prime Minister's direct insistence that former
Malaysian deputy prime minister Anwar Ibrahim receive a fair and
honest trial. On November 14 our Minister of Foreign Affairs met
with the father of opposition MP Lim Guan Eng who was wrongfully
jailed for disagreeing with the prime minister of Malaysia.
I am proud of our Liberal government's strong effort in
championing the cause of human rights at home and
internationally.
* * *
HEALTH
Mr. Chuck Strahl (Fraser Valley, Ref.): Mr. Speaker, we
know that Canadians are more concerned about health care than
almost any other issue. It is no wonder. While our health
minister says “trust me” and “read my lips”, Canadians are
saying “Let's read his record”.
Did the health minister promise to ban tobacco sponsorships
forever?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise to compensate all hep C
victims?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise amendments to the Patent
Act that would lower drug prices?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise pharmacare?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
1405
Mr. Chuck Strahl: Did he promise home care?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise openness and
transparency in his department?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise more funding for health
care?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: Did he promise to reduce waiting lists
in hospitals?
Some hon. members: Yes.
Mr. Chuck Strahl: Did he deliver?
Some hon. members: No.
Mr. Chuck Strahl: The record speaks louder than words and
the record of the minister is so abysmal it begs one final
question. Does the health minister want to be prime minister one
day?
Some hon. members: Yes.
Mr. Chuck Strahl: Will he ever deliver?
Some hon. members: No.
Mr. Chuck Strahl: Heaven help us. No way.
The Speaker: I am not sure if that should be one
statement or ten.
* * *
[Translation]
ELECTION CAMPAIGN IN QUEBEC
Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.): Mr. Speaker,
what is at stake on November 30 is clear.
A vote for the Liberal Party is a guarantee that there will be
no referendum on the separation of Quebec.
A vote for the Liberal Party shows unequivocally that it is
possible to improve Quebeckers' quality of life.
A vote for the Liberal Party is a show of confidence in Canada
and Quebec's ability to improve their economic, social and
cultural positions in the world.
A vote for the Liberal Party is an insurance policy for the
majority of Quebeckers who are opposed to the separation of
Quebec from the rest of Canada.
* * *
SHERBROOKE MUNICIPAL COUNCIL
Mr. Serge Cardin (Sherbrooke, BQ): Mr. Speaker, on November 1,
municipal elections were held in many Quebec municipalities,
including Sherbrooke, which I have the honour of representing in
this House.
In the 12 electoral districts, voters elected women to 50% of
the positions on the municipal council. Sherbrooke, which is a
leader in many areas, is once again making history by having the
first municipal council with as many women as men. This is to
the credit and benefit of the voters, since these women have a
lot to offer to society.
I congratulate all those who were elected in Sherbrooke, and
particularly my wife, Mariette Fugère, who was elected in the
electoral district which I represented for 12 years.
I am confident that on November 30, voters in my riding will
elect as many women as men to the National Assembly, that is
Marie Malavoy in the riding of Sherbrooke, and Frédéric Dubé in
the riding of Saint-François, this in the best interests of the
people of Sherbrooke.
* * *
[English]
SOCIAL RIGHTS
Ms. Libby Davies (Vancouver East, NDP): Mr. Speaker,
Canada's anti-poverty groups are in Geneva today briefing UN
officials on Canada's utter disregard for the conventions of the
UN covenant on social, economic and cultural rights, a covenant
that calls on government to work to ensure basic social rights
like the rights of shelter and adequate nutrition.
Anyone committed to social justice now awaits what is sure to be
a devastating UN rebuke. The central government has become adept
at ignoring the cries of outrage emanating from within Canada's
borders. The question is when that condemnation comes from the
UN will it still be ignored.
We in the NDP are calling on the finance minister to commit
today to using the $10 billion budget surplus, a product of his
continued attacks on the poor, to at least meet the basic
requirements agreed to in the UN covenant.
* * *
[Translation]
ELECTION CAMPAIGN IN QUEBEC
Mr. Denis Paradis (Brome—Missisquoi, Lib.): Mr. Speaker, this
evening, an important debate is being held in Quebec. It is the
leaders' debate, which is being held as part of the campaign
leading up to the November 30 election.
It will give the Liberal leader an opportunity to show
Quebeckers that Canada is a land with a future of great
achievements for the start of the next millennium.
Brome—Missisquoi wants to be part of it.
The debate will provide an opportunity to underscore the reality
and the issues of the upcoming election. A vote for the Parti
Quebecois is a vote for a referendum, as the Bloc Quebecois
leader indicated at the start of the campaign.
The debate will bring out the fact that Quebec enjoys a special
status in North America because of its culture, its geography
and its economy.
There is no doubt. A better life in Canada requires Quebec.
* * *
FINANCIAL INSTITUTIONS
Mr. Odina Desrochers (Lotbinière, BQ): Mr. Speaker, according to
the word going round in the papers, it would appear that some of
Canada's chartered banks are boycotting Quebec bonds.
We learn in fact that neither the Bank of Montreal nor the Royal
Bank have any Government of Quebec bonds. And yet, they have
$1.4 billion worth of federal bonds and over $420 million in
bonds issued by five provincial governments elsewhere in Canada.
It is a scandal that the financial institutions wanting our
savings cannot even be bothered to invest them here.
I am sure this information will give a number of people who were
perhaps thinking of doing business with these banks cause for
reflection.
* * *
1410
[English]
FISHERIES
Mr. Mark Muise (West Nova, PC): Mr. Speaker, this coming
Saturday has been designated as World Fisheries Day. It is
important that Canadians and the rest of the world recognize the
importance of the fishery in our economies and the devastating
consequences that will result if we do not start doing a better
job at protecting this industry.
The collapse of the northern cod fishery is a prime example of
what can occur when we take fishing stocks for granted. The
results are that thousands of fishers have been forced out of the
fishery, bringing to an end a way of life that has survived for
generations.
I am not convinced that our fisheries minister has learned
anything from past mistakes. For months now I have tried to
focus his attention on the serious illegal lobster activity going
on in West Nova. The minister is intent on believing that the
problem has been addressed.
Fishers, along with regional DFO officials, continue to tell me
otherwise. It continues to be a serious problem that must be
addressed before the lucrative West Nova lobster industry goes by
the wayside like the northern cod fishery.
* * *
SIMCOE—GREY
Mr. Paul Bonwick (Simcoe—Grey, Lib.): Mr. Speaker, I
rise today to make you, our Prime Minister, my colleagues in the
House and in fact all of Canada aware of one of the greatest
economic opportunities in industry.
The opportunity I speak of is Simcoe—Grey. Simcoe—Grey is
situated in the most beautiful part of southwestern Ontario and
indeed all of Canada. We are strategically located within a two
hour drive of well over 10 million people.
We also have access to a variety of university and college
campuses. These facts, coupled with a group of mayors and
councillors that are willing to work with business, make my
riding an ideal investment opportunity.
I ask industry officials to think of the potential: the third
largest market area in North America, skilled labour pools, open
for business attitude and a quality of life second to none.
On behalf of the residents of Simcoe—Grey I say please visit
our riding. We are open for business.
* * *
POVERTY
Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): Mr.
Speaker, the living conditions of the very poorest in Canada are
worse now than in a very long time. The numbers of the homeless
continue to rise and the line-ups at food banks grow longer.
Aboriginals living on reserves are often living in third world
conditions. After tax incomes remain well below individual
incomes of the 1980s.
Next week several Canadian anti-poverty groups are visiting the
United Nations to point out that for too many Canada is not the
best country in the world in which to live.
The government has shamed Canadians by ignoring UN questions
about our social problems for two years. When it finally had to
submit a report, the government simply refused to answer some of
the strongest concerns.
Yet the government sits on $10 billion in overtaxation for the
first six months of this fiscal year alone. Why does the
government continue to overtax and cut services to the most
disadvantaged in our society?
* * *
EDUCATION
Mr. Andrew Telegdi (Kitchener—Waterloo, Lib.): Mr.
Speaker, I rise today to applaud the achievements of the two
universities in my riding of Kitchener—Waterloo.
In this year's Maclean's magazine annual ranking of
Canadian universities our reputation thrives. The University of
Waterloo is considered the best overall comprehensive university
and Wilfrid Laurier is the fourth best overall primarily
undergraduate university.
U of W is considered the best overall, the most innovative and
ranks highest for the leaders of tomorrow. Within comprehensive
schools it ranks first for the average entering grade and student
awards.
In its category Wilfrid Laurier ranks first in the proportion of
students with 75% or higher and second in average entering grade.
Post-secondary education is the key to our future prosperity as
a nation. The tangible commitment our Liberal government has
included increased funding for granting councils, centres of
excellence, improvements to the Canada student loans program, the
millennium scholarship fund, research infrastructure renewal and
the Canada Foundation for Innovation.
I congratulate both universities for their excellent standing in
this annual survey and commend them for always striving to be
better.
* * *
EDUCATION
Mr. Nelson Riis (Kamloops, Thompson and Highland Valleys,
NDP): Mr. Speaker, I acknowledge the great contribution made
to the economy and society of British Columbia by the University
College of the Cariboo.
The University College of the Cariboo created a cult of
innovation for young entrepreneurs and investors throughout the
central part of British Columbia. It developed a culture of
openness, welcoming students from over 21 different countries to
study and to enrich the educational atmosphere of that university
college.
Its programs from degree granting to training and upgrading
reflect the totality of the British Columbia economy. The plans
of the University College of the Cariboo reflect a changing
economy, a very innovative university college to meet the demands
of the ever changing economy of the 21st century.
It is a model for the rest of Canada and provides the kind of
educational experience that truly reflects the realities of the
new millennium and the true realities of a knowledge based
economy.
ORAL QUESTION PERIOD
1415
[English]
FINANCE
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, for yet another year the auditor general has refused to
sign off on the finance minister's accounting trickery.
The auditor general says the finance minister is improperly
billing the taxpayer today for spending that will not happen for
years. He objects to the finance minister's trying to hide
billions of dollars from Canadians who want tax relief and debt
reduction today.
What is the point of even having an auditor general when this
finance minister simply laughs in his face and ignores his
recommendations?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the accounting procedure that was followed in this case
is the one followed in the private sector. It is more open and
transparent than that which has been recommended by the auditor
general in the public sector.
We believe government has a responsibility to be as open and
transparent as possible. That is why we booked the liability as
soon as it was incurred.
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, the auditor general has pointed out that the finance
minister is billing Canadian taxpayers for programs that have not
even started yet.
If a private business were to book expenses that have not yet
been made to hide the true size of its profit, the revenue
minister would have that business in court.
Why should the finance minister be allowed to get away with
accounting practices which would land a taxpayer in court or in
jail?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the Leader of the Opposition is wrong on both counts. In
fact, the millennium foundation has been set up. Second, it
happens all the time in the private sector that when obligations
or liabilities are incurred they are booked.
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, the finance minister is playing a shell game with the
money of Canadian taxpayers. He pads expenses with future
projects to make the surplus look smaller so he can say there is
no money for tax relief. He cuts $7 billion out of health care,
gives $2 billion back and thinks no one will notice there is $5
billion missing.
Does the finance minister actually think these kinds of shell
games will fool anyone other than gullible Liberal backbenchers?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the real difference of opinion between us and Reform is
how that money was spent.
The last budget was one of the most important education budgets
ever brought forth by the government. We gave students a tax
credit on their deductions. At the same time we gave single
parents a $3,000 grant.
Reform in its taxpayers' budget said it would take $200 million
out of education.
Miss Deborah Grey (Edmonton North, Ref.): Mr. Speaker,
the finance minister should do card tricks the way he talks his
way around things.
The government knows the auditor general is the top watchdog in
the country to look after the government's books and he should
obey them. He has not done that. Businesses and home owners
would not be allowed to cook their books the way the government
has.
I ask the revenue minister, because he would be so happy to sue
anybody who took after this kind of bookkeeping, will he stand in
his place right now and say that the way the finance minister is
cooking his books is wrong, plain and simple?
Hon. Harbance Singh Dhaliwal (Minister of National Revenue,
Lib.): Mr. Speaker, this finance minister is the best finance
minister we have ever had. We are very proud of the work he has
done. Members opposite should be embarrassed to ask the
questions they have asked of this finance minister.
Miss Deborah Grey (Edmonton North, Ref.): Mr. Speaker,
in the words of one great Canadian philosopher, beauty fades but
stunned is forever.
This minister knows that when one cooks the books in a
business—
1420
The Speaker: A few years ago we had reference to
Shakespeare. We are coming a bit close. I ask the hon. member
to watch her language.
Miss Deborah Grey: Mr. Speaker, long live the king.
The auditor general has refused to sign off on the government's
books. It can try to discuss that away but it simply will not
work. If the auditor refused to sign off on a private company's
books Revenue Canada would move in, the management would be fired
and there would be an investigation.
I again ask this question of the revenue minister and I would
like an answer. Should Canadian businesses be allowed to operate
their books the way the finance minister has been, thinking he is
against the law?
Hon. Harbance Singh Dhaliwal (Minister of National Revenue,
Lib.): Mr. Speaker, obviously the hon. member does not know
much about business.
When business people have liabilities those liabilities are
booked. Those liabilities are banked whenever they exist. She
should do her homework. She should talk to business people and
find out how they do their accounting. Obviously she does not
know a lot about business.
* * *
[Translation]
BUDGET SURPLUS
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker,
yesterday in this House the Minister of Finance confirmed his
desire to continue to dip illegally into the employment
insurance fund and admitted that he had deliberately
underestimated the size of the budget surplus.
He said, and I quote:
Why does the minister assess his surpluses at a minimum, while
dipping into the employment insurance fund to a scandalous and
immoral maximum?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, what
I said yesterday, and what I say again today, is that we intend
to proceed in a balanced manner. Every year since we came into
power, we have cut employment insurance contributions. Last
year, we reduced taxes and put money into the sectors of the
future.
This is an approach that works and one we will continue to use.
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker,
speaking of balance, one month ago the Minister of Finance was
telling us there would not be a budget surplus.
One week ago, his own department told us that, after six months,
there was a surplus of $10 billion. Why such a discrepancy?
The answer is one of two things: either this minister is
incompetent, or he refuses to debate with his colleagues, the
Minister of Health and the Minister of Human Resources
Development, in order to decide what to do with the surplus.
Which of these is the right answer?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the
hon. member is mistaken.
Some hon. members: Oh, oh.
Hon. Paul Martin: I have always said we would be going to have a
surplus this year. I said so in the economic statement.
Moreover, Canadians need to be proud of this.
What I am still saying, and I would like to quote the senior
economist at Mouvement Desjardins, is “The presence of numerous
risks, both from the economic and the financial point of view,
calls for continued caution”. That is our position.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, the
chief economist for the Mouvement Desjardins predicted a $15
billion surplus by the end of the fiscal year, while this
morning the Conference Board anticipated a surplus of $10
billion. These are the true figures.
For three years now, the Bloc Quebecois has accurately forecast
the situation of our public finances. This year, the surplus
will, in our estimation, reach $15 billion. We are proposing to
allocate $7 billion to the employment insurance fund, $6 billion
to health and $2 billion to tax reduction, for a total of $15
billion. This is our proposal.
What is this minister, who plays with numbers to hide the
reality, proposing?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, allow
me to quote François Dupuis, the senior economist of the
Mouvement Desjardins, who said “While the financial context has
stabilized in recent days, we must not forget that the situation
remains highly volatile. The presence of numerous risks, both
from an economic and financial point of view, calls for
continued caution”.
We are being cautious. The Bloc Quebecois wants to take us back
to the days when we had a deficit.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, now
that the minister is done saying things that make no sense, I am
asking him what he has to say to the president of the Canadian
Chamber of Commerce, who recognizes that there will be a surplus
in excess of $10 billion by the end of the current fiscal year,
who accuses the minister of playing with numbers, and who asks,
on behalf of all Canadian entrepreneurs, that the Minister of
Finance show a little more respect.
1425
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the
hon. member is contradicting the senior economist of the
Mouvement Desjardins. He is contradicting the senior economist
of the Bank of Commerce.
He is contradicting the vast majority of economists in Canada,
who are advising us to remain cautious and who agree with our
principles, which are to reduce the debt, lower taxes and invest
in sectors of the future, including health.
* * *
[English]
PAY EQUITY
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, in
August the government rationalized yet another delay in honouring
its pay equity debts to its own employees, claiming that further
clarification was needed from the courts. With today's federal
court decision to throw out the Bell case, the pay equity issue
is now crystal clear. Will the minister agree to stop the delay
and just pay?
Hon. Marcel Massé (President of the Treasury Board and
Minister responsible for Infrastructure, Lib.): Mr. Speaker,
the basic issue has not changed. There are two groups of women
that would be submitted to two different systems of pay equity
and we have to appeal to make sure the law is clarified.
The judge did not make a decision on methodology in the judgment
of today but merely sent it back to the tribunal of first
instance. Therefore we are back with exactly the same problem we
had. We have two different methodologies. We cannot treat two
groups of women differently in terms of pay equity. We are in
favour of the principle but we have to appeal.
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, when
this government likes a decision it touts it and when it does not
like a decision it studies it endlessly. Obviously the
government must have anticipated today's court decision as one
possibility. Surely the government had a plan. Does the plan
include paying its debts to its own employees or will it dredge
up more excuses for more delays?
Hon. Marcel Massé (President of the Treasury Board and
Minister responsible for Infrastructure, Lib.): Mr. Speaker,
the union appealed when it did not like the judgment in the Bell
Canada case. In our case we cannot as a government treat two
groups of women, the 20,000 women in the Bell case and the women
in the public service, in different ways. We still have the same
problem. We have two different methodologies and we still must
ask the court to clarify the law. We believe in the principle of
pay equity but we must treat women, whether in the private sector
or in the public sector, in the same way.
* * *
AGRICULTURE
Mr. Rick Borotsik (Brandon—Souris, PC): Mr. Speaker, in
1995 the government dismantled the long term safety net programs
that were put into place by Progressive Conservative governments
to deal with commodity pricing.
A farmer from Manitoba said that dealing with short term cash
inputs without long term commodity price safety nets is like
giving Valium to a cancer patient.
When will this minister and his government put in the proper
safety nets for our agriculture commodities?
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food,
Lib.): Mr. Speaker, I remind the hon. member of what we
inherited in 1993 which caused us to take a very serious look at
the future of not only support to agriculture but support for all
Canadians, a $42 billion deficit. In spite of that and with that
saddle on our back, we have worked with the industry to put in
place a safety net system to support the Canadian agricultural
industry. We are continuing to work with it and we are presently
reviewing that support.
Mr. Rick Borotsik (Brandon—Souris, PC): Mr. Speaker,
two weeks ago the minister met with provincial agriculture
ministers and industry stakeholders. At that time the minister
said it was time for discussion, not for decisions. It has been
reported that yesterday the United Kingdom put $250 million into
its agriculture industry. Perhaps it is time for decisions to be
made.
When will this minister put those types of funds back into our
industry so farmers can put crops in this year?
1430
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food,
Lib.): Mr. Speaker, we are continuing those discussions with
the provinces and with the industry participants. We are taking
this very seriously. We are looking at it in a very thorough and
comprehensive way. We are determined to do all that we possibly
can in order to provide all the support we can for the producers
as they go forward into the completion of this year and into the
1999 crop year.
I remind the hon. member the farmers will not be planting this
year. It will be next year.
* * *
FINANCE
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker,
today the auditor general said “In my opinion the 1997-98
surplus is understated by $2.5 billion, and accounts payable and
accrued liabilities as well as the accumulated deficit are
overstated by the same amount”. He goes on to say “I consider
this stated accounting policy to be inappropriate”.
Does the finance minister really think that the top accountant
in Canada, the auditor general, is wrong? Is he saying that the
auditor general, the watchdog for taxpayers, is wrong and that
the finance minister is—
The Speaker: The hon. Minister of Finance.
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the accounting firms of Coopers & Lybrand as well as
Ernst & Young have submitted letters. Letters from both of these
firms were tabled in the public accounts committee stating that
the procedures followed by the government were procedures
followed by the private sector and were well within the judgment
capabilities of the government to do.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, the
auditor general is independent. He reports only to parliament.
The finance minister has a political constituency to appeal to.
Does the minister not understand the need of parliament to have
an independent person like the auditor general oversee the
finances of the nation so we can avoid this kind of political
trickery? Does he not understand that?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, when we took office in 1993 one of the things we found
was the reason that the deficit came out higher than it should
have was that there were obligations that had not been reported
by the government at that stage. We decided under those
circumstances that we would be open and transparent as no other
government has been. That is why we have done this and we will
continue with that procedure.
* * *
[Translation]
HAZARDOUS TOYS
Mrs. Pauline Picard (Drummond, BQ): Mr. Speaker, yesterday,
Greenpeace released a damning report that shows how negligent
the Minister of Health had been on the hazardous toys issue.
Besides the notice issued yesterday as a result of the
denunciations by Greenpeace, how can the minister justify
sitting on his hands all this time, when he has been aware for
over a year of the threat posed to our children by these toys?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker, we
gathered evidence showing the risks and, yesterday, we took
action. We put out a notice to parents, advising them to discard
toys that constitute a hazard or pose a risk. We acted
responsibly.
Mrs. Pauline Picard (Drummond, BQ): Mr. Speaker, in light of
the danger, why did the minister, who does not miss a chance to
encroach on the provinces' jurisdiction over health, not take
action sooner?
Would he not have been better off looking after his business
properly?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker, we
acted absolutely responsibly. We closely monitored the
situation. We examined the studies presented by Greenpeace and
others. We collected evidence and, after considering all the
facts, we took action. Yesterday, we issued a notice to all
Canadian parents concerning toys that pose a risk.
* * *
[English]
FINANCE
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, let me
quote the auditor general. He states “The $2.5 billion has been
recorded as owing to an organization that was not in existence at
March 31, 1998”. We know that the Prime Minister has imaginary
friends. Now the Minister of Finance has imaginary organizations
and calls this good accounting.
1435
Why does the finance minister not just acknowledge that he is
building a slush fund for the next election?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the government had taken a decision. There was a
cabinet decision.
The institution in question was set up before the government's
books were closed. I am sure the hon. member knows that the
millennium scholarship fund is not a slush fund but in fact is a
very important instrument to help students fund their education.
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, we do
not deny helping Canadians and we want to help Canadians. The
minister is taking the money and expending it today so he has it
to spend just before the next election, as if he is doing a great
thing by the Liberal Party.
It is a slush fund by any name one might want to call it.
Whether or not other auditing companies agree with the statement,
the auditor general says no way. When are you going to listen to
the auditor general—
The Speaker: I ask the hon. member to address his
question through the Chair.
Mr. John Williams: Mr. Speaker, I apologize. I would ask
the Minister of Finance to tell us when he will listen to the
auditor general and respond to his concerns.
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the hon. member is a member of the committee that read
the Coopers & Lybrand letter. He knows that what we are dealing
with is a judgment call and a judgment call that is perfectly
within the government's capability.
What distresses me is that the hon. member, a member for whom I
have a great deal of respect, again refers to the millennium fund
as a slush fund. He knows full well that the costs of education
are onerous for many students and it is a responsibility of all
levels of government to help students pay for their education.
That is the way we will build a future. That is not a slush
fund and I am sure the hon. member wishes he had—
The Speaker: The hon. member for Mercier.
* * *
[Translation]
BILL C-54
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, my question is
for the Minister of Industry.
On October 30, the 12 provincial and territorial ministers of
justice unanimously called for the withdrawal of Bill C-54 on
e-commerce and the protection of personal information because,
and I quote “It constitutes a major intrusion in areas of
provincial and territorial jurisdiction”.
When will the Minister of Industry be announcing his agreement
to withdraw his bill, as requested unanimously by the Quebec and
Canadian ministers of justice?
Hon. John Manley (Minister of Industry, Lib.): Mr. Speaker, the
protection of personal information in electronic form is very
important for all Canadians.
We will protect it, we will pass Bill C-54. This is not an
intrusion into provincial jurisdictions. It does not even apply
in the Province of Quebec, where such legislation already
exists.
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, Bill C-54 is
so muddled that the some forty experts at the information
meeting organized by Industry Canada each had a different
interpretation.
Given all this confusion, when will the minister announce he is
withdrawing his bill?
Hon. John Manley (Minister of Industry, Lib.): Mr. Speaker,
never, because the protection of private information is too
important for Canada's consumers.
* * *
[English]
HEALTH
Mr. Grant Hill (Macleod, Ref.): Mr. Speaker, the Liberal
assault on medicare is pretty plain: $7 billion gutted from
provincial transfers, 188,000 people left in pain on waiting
lists, and thousands of health care workers leaving Canada every
year.
Why would anybody trust this health care minister with such a
dreadful record on health?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
if Canadians want to know where the parties stand on medicare,
they should consult the record. When they look at the record
they will find out where the Reform Party stands on medicare and
the Canada Health Act.
They will find that the leader of the Reform Party said he
“would amend the Canada Health Act to allow user fees,
deductibles and private delivery of services”. He said that he
“would require some Canadians to pay at least a portion of their
own health care costs under certain conditions”.
The Reform Party would cut $9 billion from social programs. And
that is the party that expects us to listen to it on medicare.
1440
Mr. Grant Hill (Macleod, Ref.): Mr. Speaker, is it not
interesting that the lawyer for the court tries to wiggle out of
his own record by deflecting attention to somebody else.
Some hon. members: Oh, oh.
The Speaker: I would ask the hon. member to go to his
question.
Mr. Grant Hill: Mr. Speaker, the trust is gone. Carl
Erickson is on a waiting list. He does not trust this minister.
The hepatitis C compensation people do not trust this minister.
Why would anybody trust this Minister of Health with his dreadful
record and pay attention to his record?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
in fairness to my profession, I think I should first make it
clear that lawyers do not wiggle. They step deftly. Let me do
just that in pointing out that so far as the member and his party
are concerned, the verdict is in. The verdict is that if
Canadians want to see medicare protected, if they want to see
health care in the future as they have seen in the past, if they
want to see investments in social programs and social justice,
they will support this party and this government.
* * *
[Translation]
ICEBREAKING POLICY
Mr. Yves Rocheleau (Trois-Rivières, BQ): Mr. Speaker, with regard
to the issue of icebreaking on the St. Lawrence River, the
president of the Coalition maritime et industrielle nationale
wrote the following to the minister, on July 3:
Very few or our 27 recommendations were accepted. Most were
rejected, ignored or altered to serve the interests of the coast
guard.
How can the minister have the nerve to tell us that he
implemented the recommendations of a committee when it is
absolutely not true?
Hon. David Anderson (Minister of Fisheries and Oceans, Lib.):
Mr. Speaker, as regards the icebreaking fee structure, we did
follow the committee's advice. The committee was made up of 10
members. Seven were from the Great Lakes and the St. Lawrence.
There were people from Ontario and Quebec.
They proposed a rate scale. We accepted it. This is exactly what
happened.
* * *
[English]
PUBLISHING INDUSTRY
Ms. Sarmite Bulte (Parkdale—High Park, Lib.): Mr.
Speaker, my question is for the Minister of Canadian Heritage.
Critics of Bill C-55 allege that it is protectionist and it will
hurt Canadian advertisers. Will the minister inform this House
how this legislation will indeed help our magazine industry?
Hon. Sheila Copps (Minister of Canadian Heritage, Lib.):
Mr. Speaker, I want to thank four out of the five parties in the
House who understand the importance of keeping Canadian spaces
for Canadian voices and Canadian children, and I would further
underscore, as have also successive Canadian governments.
[Translation]
The governments formed by various political parties have always
supported the right of Canadians to protect their own culture in
their own country.
[English]
There is only one political party in this House that prefers to
speak for the Americans and that is the Reform Party.
* * *
FORESTRY
Mr. John Duncan (Vancouver Island North, Ref.): Mr.
Speaker, Greenpeace is killing forestry in British Columbia and
the government is helping.
The leaders of the local forestry union asked the Prime Minister
to meet with them to discuss this crisis. He told them to go and
see the labour minister who told them to go and see the human
resources minister who yesterday said no.
Why does the minister not save everyone's time and just admit
that he does not give a damn?
The Speaker: Perhaps Rhett Butler could say it, but not
in this House.
Mr. Bob Speller (Parliamentary Secretary to Minister for
International Trade, Lib.): Mr. Speaker, the Government of
Canada is very concerned about any misinformation campaign on
Canadian forestry practices being waged by any group or
government.
1445
I also want to make it very clear that sustainable forest
management is a very high priority for the Government of Canada.
We enforce our forest practice codes to the letter. Our missions
and consulates around the world are standing up for the Canadian
forest industry, the workers, the producers and the governments,
and I think they are doing a good job.
Mr. John Duncan (Vancouver Island North, Ref.): Mr.
Speaker, the Liberals place no priority on this issue which
affects our largest export. This is because the Liberals do not
care about problems west of the Rocky Mountains.
The other question from those devastated families is: Why does
the minister treat foreign lobbyists better than Canada's own
forestry representatives?
Hon. Ralph E. Goodale (Minister of Natural Resources and
Minister responsible for the Canadian Wheat Board, Lib.): Mr.
Speaker, long before this member or that party engaged in this
issue in this House, this government and our provincial
counterparts were working very hard on delivering the message
around the world that Canadian forest practices are sustainable
and that we can be trusted to pursue those practices in this
country.
Among other things, we invite buyers to come to this country to
look at our practices, and those buyers who have come and seen
for themselves go home and change their opinion because they have
seen the truth in Canada.
* * *
HAZARDOUS PRODUCTS
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, last year the health minister said that Canadians
concerned about toxic toys were misinformed. The minister even
voted against a bill by the member for Acadie—Bathurst to label
toys containing phthalates. Now the minister finally issues a
warning, but there is no list of the hazardous products and we
cannot even get through on his 1-800 number.
What is the minister doing to resolve this retail nightmare?
Will the minister at least agree to the labelling of toxic toys?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
we went one step further than that. We took toxic toys off the
market. That is the way we should behave.
I will say something else to the member. Rather than acting as
the member would have us do without evidence, we spent the last
many months with other countries examining the facts in
scientific tests to determine what the facts were. Based on the
evidence, all of which was published on Monday of this week, we
acted in a responsible way. For us the bottom line is the safety
of Canadians.
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, the minister has done no such thing. The minister has
created chaos at the retail level and he has refused to deal with
poisonous substances in terms of phthalates, lead and cadmium.
Will the minister finally admit that he was wrong? Will he take
steps to ensure that children's safety is put first? Will the
minister regulate any products that have dangerously high levels
of phthalates, lead and cadmium? Will the minister do everything
to ensure that children are not exposed to dangerous substances
that cause neurological damage? Will the minister do it now?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
Canadians by now, along with most members of the House, have
learned to filter out the fevered rhetoric of the New Democratic
Party. Instead they focus on what the reality is.
The reality was explained calmly yesterday by scientists from
Health Canada who tabled the proof, who took the public through
the facts, who explained which toys are safe and explained why
others are being taken off the shelves.
I believe it is clear to Canadians what course they should take.
It is equally clear that this government has acted in the public
interest.
* * *
TAXATION
Mr. Scott Brison (Kings—Hants, PC): Mr. Speaker, in 1989
the current finance minister said that he was worried that the
government would attack the deficit on the backs of the people
who could not afford to bear the burden. Yet a recent survey
shows that low income Canadians have been the hardest hit by this
government's regressive tax policies. Bank of Canada figures
show that Canadians have the highest personal debt ever.
Is the finance minister satisfied that he has helped put this
government in the black by putting Canadians in the red?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, what happened in 1989 is that we were objecting to the
increasing taxation as we headed into a period of recession,
which is what the previous government did. Since that time
obviously Canadians have suffered. Fortunately, if we take a
look at what has happened, in 1996-97 family disposable income
rose and the net worth of Canadians increased.
1450
Mr. Scott Brison (Kings—Hants, PC): Mr. Speaker, the
government has balanced the books by overtaxing Canadians.
Federal tax revenues have ballooned from $116 billion in 1993 to
over $151 billion this year. As well, policies like free trade,
implemented by the previous government, have helped generate
revenues to pay down the deficit. Yet the current finance
minister was opposed to free trade in 1990. The finance minister
has flip-flopped on free trade.
I ask him today to do the right thing and flip-flop on tax
reductions. Do the right thing now, take our advice and give
Canadians the tax relief they need.
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, perhaps the hon. member was not here for the last
budget, but after we had eliminated the $42 billion deficit we
immediately began to proceed to reduce taxes by $7 billion over
the next three years. Four hundred thousand taxpayers have been
eliminated from the tax rolls.
We very much hope that we can continue to do this.
Let there be no doubt about it, tax reduction is an important
priority for this government, but, unlike the opposition, so is
health care, so is education, so is research and development and
so is the basic social fabric of the country.
* * *
CANADIAN WHEAT BOARD
Mr. Murray Calder (Dufferin—Peel—Wellington—Grey,
Lib.): Mr. Speaker, my question is for the Minister of
Natural Resources.
The so-called Farmers for Justice are complaining that the
voters' list for the Canadian Wheat Board contains the names of
people who are deceased.
I would like the minister to explain why they are putting dead
people on the voters' list.
Hon. Ralph E. Goodale (Minister of Natural Resources and
Minister responsible for the Canadian Wheat Board, Lib.): Mr.
Speaker, the House of Commons Standing Committee on Agriculture
and Agri-Food expressly amended Bill C-4 to specify that CWB
directors will be elected by producers. That was supported by
all parties and by all major farm organizations.
The word “producer” is a defined term in the act. It includes
actual producers and those who are interested parties legally
entitled to share in a portion of an actual producer's crop.
This latter category obviously, in some cases, includes those who
are administering the estates of interested parties. It is up to
farmers themselves to ensure that the information shown in CWB
records is accurate and up to date.
* * *
CANADA PORT AUTHORITIES
Mr. Lee Morrison (Cypress Hills—Grasslands, Ref.): Mr.
Speaker, we know that the Senate is full, but the Liberals still
have a good patronage haven, the Port of Halifax.
The intent of the new Canada Marine Act was to devolve control
of seaports to local stakeholders. In Halifax nominations to the
port advisory committee by local shipping, commercial and labour
interests were ignored to make room for the same Liberal hacks
who have run the port for years.
Now Merv Russell and his crew are incestuously engaged in
selecting themselves and their buddies as port authority
directors.
When will the Minister of Transport defend the public interest
and stop abetting this nonsense?
Hon. David M. Collenette (Minister of Transport, Lib.):
Mr. Speaker, we are setting up 18 Canada port authorities across
the country and they are all being treated in the same way. They
are all being treated fairly, according to the dictates of the
law.
There are many inaccuracies in the hon. member's question.
First of all, the interests that he claims were not on the
advisory group are represented. The Chamber of Commerce is
represented. Local business is represented. Trade unions are
represented. They are all represented. What he is doing is
getting sucked into a local partisan political debate in Halifax.
I would have thought he was above that.
* * *
[Translation]
ICEBREAKING POLICY
Mr. Michel Guimond
(Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ): Mr. Speaker,
my question is for the Minister of Fisheries and Oceans.
Yesterday, in reference to his unfair policy of charging for
icebreaking, the minister stated, and I quote:
At the time, the committee thought it had achieved the most
satisfactory compromise—
Are we to conclude that, at the time he refers to, the minister
finally realized the error of his policy of charging for
icebreaking, and that he intends to change it before irreparable
damage—
The Speaker: The hon. Minister of Fisheries and Oceans.
Hon. David Anderson (Minister of Fisheries and Oceans, Lib.):
Mr. Speaker, the policy is clear. Vessels using the icebreaking
service must meet 17.5% of the costs. Not half, merely 17.5%.
A committee made up of representatives of the ports and of
interests in the St. Lawrence and the Great Lakes drew up a
scale of fees. We accepted it. It is based on ships'
crossings, and 85% of them—
The Speaker: The hon. member for Winnipeg Centre.
* * *
1455
[English]
UNEMPLOYMENT INSURANCE
Mr. Pat Martin (Winnipeg Centre, NDP): Mr. Speaker, the
EI system is showing an incredible surplus of $600 million per
month, yet less than 40% of unemployed Canadians qualify for
benefits.
Now the government suggests that it will use some of its fiscal
surplus to provide tax cuts to the wealthy. It is like some
perverted version of Sherwood Forest where it intends to rob from
the poor to give to the rich.
Will the finance minister reject calls from the Business Council
on National Issues and others to take billions from the pockets
of the unemployed to line the pockets of the rich? Will he
commit today to use the EI surplus only to restore benefits and
eligibility and for no other purpose?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, the hon. member knows full well that we reduced EI
premiums. We have done so every year.
He also knows that in the last budget the 400,000 people who we
took off the tax rolls were the lowest income Canadians. At the
same time, the tax cuts that we brought in benefited those
earning salaries of less than $50,000. The national child tax
benefit brought in by my colleague, the Minister of Human
Resources Development, is directed toward poor families with
children.
The fact is that the tax cuts we bring in are really dedicated
to those who need them most.
* * *
CANADA POST
Mr. Gilles Bernier (Tobique—Mactaquac, PC): Mr. Speaker,
it seems to me that Canada Post has once again run amok.
I have been given information from several Canada Post employees
that Mr. Barry Bennett, the director of the Fredericton region,
used the Fredericton sorting station to store his sports car last
winter.
When exactly did the minister begin allowing Canada Post
managers to use crown owned properties as their personal storage
facilities?
Hon. Alfonso Gagliano (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, I thank the member
for bringing this case to my attention. It is the first time I
have heard of it. I will investigate it right after question
period and we will see what happens.
* * *
UNEMPLOYMENT INSURANCE
Mr. George Proud (Hillsborough, Lib.): Mr. Speaker, for
months now we have been hearing opposition members complain that
the government does not care about seasonal workers, that the
employment insurance system does meet the needs of Canadians and
that the government is only interested in balancing its books on
the backs of the poor.
Can the minister tell us what he has done recently to prove the
opposition wrong? What has he done to fix the unemployment
insurance system?
Hon. Pierre S. Pettigrew (Minister of Human Resources
Development, Lib.): Mr. Speaker, on November 10 I announced
the launch of a new small weeks project in 31 high unemployment
regions of our country.
This small weeks project is a direct result of our commitment to
monitoring EI reform on a continuous basis. We are investing a
further $225 million so that workers who often rely on EI
benefits are not penalized when they take on as much work as
possible.
This clearly shows our commitment as a government to make
changes—
The Speaker: The hon. member for York South—Weston.
* * *
TAXATION
Mr. John Nunziata (York South—Weston, Ind.): Mr.
Speaker, the Minister of Finance knows that ordinary working
Canadians are being ripped-off by the tax system.
The National Hockey League Players Association earns tens of
millions of dollars tax free every year as a result of a loophole
in the tax system.
Does the Minister of Finance believe that it is fair that
ordinary working Canadians should be subsidizing rich hockey
players who earn on average $1.25 million a year? When will the
Minister of Finance close this unconscionable loophole in the tax
system?
Hon. Harbance Singh Dhaliwal (Minister of National Revenue,
Lib.): Mr. Speaker, what the hon. member is saying is simply
not true.
All hockey players in Canada are required to pay taxes. They
are required to pay on the number of games they play within
Canada. It is pro-rated. They do pay taxes just as any other
Canadian.
* * *
CANADIAN FARMERS
Mr. Howard Hilstrom (Selkirk—Interlake, Ref.): Mr.
Speaker, this government is gouging farmers. It collects $138
million through user fees by agencies such as the Canadian Grain
Commission and the Canadian Food Inspection Agency. It is within
the agriculture minister's power to immediately cut these costs.
To date he has done nothing.
Why does the agriculture minister keep on ripping the last of
the profits from our Canadian farmers?
1500
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food,
Lib.): Mr. Speaker, the Canadian Grain Commission provides
the guarantee to the Canadian producers of grain and to the rest
of the world that we have the finest and highest quality grain.
The recovery costs on that system to the producers is the same
now as it has been for many, many years. On the Canadian food
inspection system, in the efforts that we had to take in order to
recoup from the incredible financial situation that we inherited,
we have asked the industry after a long consultation to
participate in covering some but only a minor portion—
* * *
PRESENCE IN GALLERY
The Speaker: I draw the attention of hon. members to
the presence in our gallery of Mr. Arthur Donahoe,
Secretary General of the Commonwealth Parliamentary Association.
Some hon. members: Hear, hear.
GOVERNMENT ORDERS
[English]
CANADA SMALL BUSINESS FINANCING ACT
The House resumed consideration of Bill C-53, an act to increase
the availability of financing for the establishment, expansion,
modernization and improvement of small businesses, as reported
(with amendments) from the committee; and of Motion No. 1.
Mr. Grant McNally (Dewdney—Alouette, Ref.): Mr. Speaker,
it is a pleasure to speak to this amendment.
In this bill the government is taking a look at small business.
It wants to provide more funds for small business. We would argue
on this side of the House that what the government should do is
provide the economic climate for small businesses to flourish and
prosper in Canada.
1505
I visit businesses in my riding. I talk to employers who work
very hard at their businesses and who employ a small number of
employees. They do not mention that they need a subsidy.
It is the government's responsibility to provide an economic
climate that would help to foster a positive economy for our
country. We know small business is the engine of job creation in
Canada; it is not government but small business.
Subsidies can have the effect of rewarding one small business in
competition with another with the other company's own tax
dollars. That does not seem to make sense. It would make better
sense for the government to focus on the things it can take care
of, such as high payroll taxes.
There are very high EI taxes in Canada. Today in question
period we heard the finance minister openly defy the auditor
general's report. The auditor general said that the accounting
practices the minister is employing are not proper and that he
would not sign off on those government estimates. Yet the
finance minister stands in his place and says that it is okay,
that the Liberals can do this, that they are the government so
they can do this.
That is exactly the kind of thing small businesses would like to
see changed. They would like to see payroll taxes decreased.
The Acting Speaker (Mr. McClelland): I know the hon.
member for Dewdney—Alouette is having a bit of a difficult time
but I can assure the hon. member for Dewdney—Alouette that he
has the undivided attention of the Speaker if that of no one
else.
An hon. member: Does he read well?
Mr. Grant McNally: Mr. Speaker, thank you. I appreciate
that.
The Minister of Transport indicates that I am reading my speech
well. I have no notes before me. I am simply telling him and
the government what the people of my riding are telling me. They
are telling me that they are sick and tired of high payroll
taxes. Those payroll taxes are the taxes that are stopping them
from hiring more employees. It is those payroll taxes, which the
Minister of Transport seems not to be aware of, that are causing
employers in his riding and in my riding to work very long hours
because they cannot afford to hire more staff to do the job. I
have talked to a number of such employers in my riding. If he
had any interest in the small businesses in his riding, he might
do the same.
The government is currently overcharging employees by $350 on
their EI premiums. Businesses are paying a whopping $500 more for
each employee than they need to. That means in a company with 10
employees, each are paying $350 too much. If they could keep
that money they could spend it in the local economy and stimulate
that economy even further. With the current premiums and the 10
employees, the employer is paying an extra $5,000 per year. If
it were a larger company with 100 employees, the government would
be overcharging it by $50,000. That is wrong. It kills jobs.
We know, and the Minister of Finance has said this himself, that
high payroll taxes are a cancer on job creation in Canada.
Yet he goes ahead with these policies. He barges ahead. He
defies the auditor general who has said that these accounting
practices are not ones that he can agree with.
1510
There is also the issue of high CPP premiums. We know that
those premiums have had to be increased because of the
government's mismanagement of the CPP fund. We know that those
payroll taxes are also increasing. They are going to increase by
73% over the life of those increases, over the six years that
this government has implemented its plan of grabbing back more
money from Canadians.
What this government could do is take note of these types of
payroll taxes and work to lower them. It could do that. It has
the power and the ability to do that. We see other bills being
brought forward by the government. However, issues that Canadians
and small business people are talking about in lowering their
taxes are being ignored. It is quite unbelievable.
We saw that again today in question period when the Minister of
Finance said that it is okay for the government to do that kind
of thing, that it is well within the government's purview to do
that. The Minister of Finance is saying to Canadians and small
business people that it is okay for him to extract extra cash
from them, which is not needed for the EI surplus because there
is already a large surplus there. He is saying that to working
Canadians. He is saying that to small business people in Canada.
Those are the kinds of things the government should be
addressing. We would encourage it to address those issues. Those
are the things that really strike at the heart of working
Canadians and small business.
If the government were really concerned about small businesses
it would go about making changes and implementing policies and
plans that would get the bureaucracy and red tape out of small
businesses and allow them to flourish.
When I was talking to small business owners in my riding I was
quite surprised by the number who told me that they would like to
hire more employees. I know I mentioned this earlier but I do
not think the government was listening. They would like to hire
more employees but they have such an incredible amount of red
tape right now and are paying such high payroll taxes that they
just cannot do it. A number of them told me something very
shocking and surprising. They were on the verge of selling their
businesses and going back to work for someone else. They simply
cannot put in the long 18 hour days any more. It is beyond their
capability to do that.
That is sad because what that means is that those individuals
who are creating the jobs are being saddled with such high taxes
that the government is providing them with a disincentive to do
better. Of course the better they do, the higher their taxes are.
The more employees they hire, the more payroll taxes they pay.
In fact they are overcharged for every employee, as I mentioned
earlier. That is hurting them. It is simply not an effective
policy. It is the kind of thing we and small business have been
asking the government to address for a very long time.
We do not see responses from the government. We do not see it
moving in this direction. We see it moving in other areas that
are not effective. We have to assume then that the Liberal
government is devoid of any new ideas, of any practical
implementation of things within its power to put in place. It
would be very simple for the government to do that. It is a
shame it has not taken the time to put those policies in place.
It is for that reason I cannot support the amendment or the
bill. I would encourage the government to focus on lowering
payroll taxes and making life easier for small businesses because
they generate the jobs in this country.
1515
[Translation]
Ms. Jocelyne Girard-Bujold (Jonquière, BQ): Mr. Speaker, I am
pleased to rise in the House today to speak to Bill C-53 and to
support the amendments brought forward by the member for
Mercier. These amendments are aimed at making the act more
responsive to the real needs of small and medium size
businesses.
Even though the Bloc Quebecois is extremely disappointed with
this so-called review of the Small Business Loans Act, we do not
for one minute think that the SBLA should disappear. On the
contrary. However, we want the government to be more attentive
to the needs of small and medium size businesses in reviewing
the act.
The truth is that small businesses are extremely important.
Statistics reveal that large businesses no longer are and will
no longer be the main creators of jobs. Small businesses will
give opportunities to those who want to become their own boss
and to succeed in a field in which they chose to specialize to
create their own job and to create other jobs for people who may
join their small business.
With my colleague from Mercier and several members of the Bloc
Quebecois, I took part in a poll of small and medium size
businesses in my riding because we know how important this act
can be for them. It is a matter of life and death.
We asked the interviewees very specific questions and the
response rate shows beyond any doubt that the amendment put
forward by the hon. member for Mercier indicates exactly where
the small businesses stand right now and what they need in order
to survive and if possible expand, and hence create jobs.
In answer to the first question, 90% of the small businesses
responding stated that they find it very hard to get financing
at a reasonable cost. Several of them added, and I quote:
More and more often, we have to put up not only our own assets
but those of our spouse. Our own recognizance is not enough.
Banks often charge small businesses higher fees. Since the banks
do not make a lot of profit on personal loans, they hike up the
service fees that are not legislated.
To increase the term of a loan from five to eight years does not
make any sense.
Not enough financing is in some ways worse than no financing at
all, because the business cannot develop and expand as it could
or as it should.
The second question was used to find out if the Small Business
Loans Act was well known. And 55% of the respondents indicated
that they did not know the legislation very well and 45% knew
about it, but the vast majority, more than 90% of the
respondents, thought the legislation could be enhanced. I would
like to quote some of the comments made most frequently: get rid
of capital tax; there are so many criteria to have access to
financing and to qualify that, in the end, we would not need it.
On the fourth question, 95% of respondents felt that loans
should be given for working capital and not only for equipment
and assets and real property. The pilot projects will provide a
good opportunity to establish the options in this area.
The last question for heads of SMBs read “From your experience
and according to your staff, would it be easier to develop SMBs
if they had ready access at reasonable cost to management
advice?” The answer was 98% affirmative. Also “In your
experience, would there be fewer bankruptcies?” Ninety-five per
cent said yes.
For these very eloquent reasons supported by a very enlightening
poll in addition to arguments my colleagues have made, we tabled
the amendments to improve Bill C-53 for SMBs, that is, to make it
serve them, employment and productivity better.
We want the good news for these businesses to be not just the
extension of the small business loans program, but its extension
and its improvement. The aim of our amendments is to respond to
the shortcomings we and the SMB managers have noted.
1520
[English]
Mr. Howard Hilstrom (Selkirk—Interlake, Ref.): Mr.
Speaker, the Canada small business financing act deserves more
scrutiny than what it will get and more critical comment that may
not be listened to by the government as the bill proceeds through
the House of Commons.
The motion we are discussing today by the member for Mercier is
that Bill C-53 be amended on page 2 by adding in a new clause.
Clause 2.1 states:
Where I start to wonder what is really meant by this
amendment is when it states:
What is a small business? A small business is simply an
individual, a man or a woman, who has an entrepreneurial spirit,
a spirit of being able to say “I don't really want to work for
someone else, I want to work for myself and, as a result, I want
to start up my own business”.
Small business is the backbone of a lot of our communities. As a
result, we need these kinds of people, these entrepreneurs who
will stand up say they can make it work.
There is no doubt that an entrepreneur who comes forth with a
better widget, a better product, a new product that has never
been thought of before, a service or an idea that needs promotion
and development will need to access capital.
However, in accessing that investment capital his idea, his
service, what he is thinking of, the job he may be wanting to put
forward to create employment may not be good. As a result, when
the entrepreneur goes in for financing from the normal sources or
even from relatives or their own investment sock they may have
put away, they may find that the financial institution or the
independent lender says their idea is not good enough and they
are not willing to finance it. What the financial institution may
say to the entrepreneur is that their idea has little or zero
chance of success.
It would seem to me this amendment is then going to state that
where an entrepreneur has no chance of success maybe the
government will step in and kind of make sure they do get
financing.
The country is littered with empty plants, both small and large,
where government has stepped in and said it is great to be
producing this bottled water in Saskatchewan. There are
magnificent magnesium processing plants in Alberta. Manitoba has
certainly had its share of plants that started up, ran for a
couple of years and then shut down because they were not viable.
We therefore have to be concerned when we see amendments like
this which state that financing should be provided to businesses
and entrepreneurs which otherwise have no access to financing.
1525
When there are amendments and clauses in acts like that it is an
open invitation to the government of the day to use the financing
and guarantees of loans that are not economically viable or
financially stable. It simply uses these special little sections
to provide money to people who in lots of cases are looking to
the government for support, and in return the government expects
to get votes. That is why I have a problem supporting this
amendment to Bill C-53.
We know that any time the government starts passing legislation
it will cost money. Every act costs money. If it is not
necessary or will not do the job it is meant to do then it should
not be passed.
In this case financing a small business idea that is not
economically viable and will not work is not where government
should be priorizing its funding, or in the case where it does
not put the money out directly where it guarantees the loan and
ultimately ends up paying it off.
The cost of legislation can be seen in all manner of things that
have been passed in the House in the last five years, probably
even longer. I refer to the Firearms Act which this year is in
the neighbourhood of $130 million plus the $200 million the RCMP
is expected to come up with for a computer system.
The purpose of the Canada small business financing act is
certainly not to support money losing businesses and ideas. The
effect it has is to demoralize those business entrepreneurs who
are making a go of it with a good idea and they see someone else
have an unfair competitive advantage through government support.
The cost of government applies across the whole sector. At
present we see small businesses near agricultural communities
suffering because of the cost of government on the agricultural
sector. Certainly it would help if the cost of government on
agriculture were reduced.
I mentioned to the agriculture minister today that many of the
user fees and cost recovery programs the government has
instituted over the years could well be set aside, either
suspended and/or terminated. That would leave more money in the
hands of small businessmen like farmers. In essence they are
small businessmen. As they spend and the money flows through the
economy everyone would have more capital with which to start
small businesses.
The costs to small business are the same as in agriculture. One
could think of a hardware store or whatever in a small town. Some
of the costs are applied to all business such as the GST and the
employment insurance premiums that are taken off. In this case
there is a lot more paid in than is needed to keep the fund
going.
We see Canada pension plan premiums rising all the time and we
end up in 20 or 30 years with a pension that is so small compared
to what we invested that we should have just saved our money in
the first place.
We see business and personal taxes so high they are killing
investment. They kill the idea of a small business man or woman
trying to get ahead. It may be financed to get the business
started but if it is killed after it gets going with taxes,
employment insurance, GST and all these onerous taxes, why bother
starting it in the first place?
I do not support the amendment to Bill C-53. I suggest to the
government that it look at getting out and reducing the cost of
small business. That would have a lot more benefit than trying
to finance some business that does not have a chance in the first
place.
1530
Mr. Jake E. Hoeppner (Portage—Lisgar, Ref.): Mr.
Speaker, it is a pleasure to speak to Bill C-53, an act to
increase the availability of financing for small businesses which
would not otherwise have access to financing.
You are aware, Mr. Speaker, of what small business is about if I
gauge it right. You have been involved in small business and
know what is needed to run a small business: financing and
capital. I started thinking in layman's terms as far as a farmer
is concerned. If you ain't going to make it, why borrow more
money and do it? That seems to be the intent of the bill.
There is a saying on the farm that if government helps once we
will survive. If it helps twice we will get very sick and if it
helps another time we will die. That is possibly what is
happening here. If a businessman does not deserve or cannot be
provided with financing by somebody, maybe death will be there in
the long run anyway.
I do not want to take anything away from entrepreneurs. I give
the example of a gentleman that I have known for a number of
years. He had some financial problems in his business venture
and had to shut it down. He got another idea which he felt was a
deserving idea. He required some financing from financial
institutions but was turned down time and time again.
I did not realize that this had been going on, but when I saw
him he had started a business and was doing fairly well. I asked
him where he finally found an institution that would give him
financing. He said he never found one but had asked a couple of
friends whether they would be part of what he was doing. He
found some private money and got started. He was very
successful.
I asked him what he had to do to persuade somebody that he was
stable enough or entrepreneurial enough to start a business. He
said he had to pay 18% interest for the money. That was what he
had to do.
He was honest, worked hard and made it. If the money had come
easily and he thought if he did not make it the government would
back him up, I wonder if he would have put in the same effort and
asked other people to advise him or to help him. This is what I
am talking about when I say that perhaps government helps too
much. It helps us to die, not to survive.
I thought a very interesting comment was made in the House the
other day when we were debating the farm crisis on a motion the
Reform put forward. A question was asked of the agriculture
minister who said that no farmer should be able to farm without
getting a job on the outside. That is the type of help the
government wants to give to the farming industry. Does it
realize it is a small business compared to large manufacturing?
That was a rather discouraging answer.
We just heard the hon. member for Selkirk—Interlake talk about
some of the fees assessed against farmers. I will point out a
very simple illustration on my farm in the last month or so. We
grow some very desirable durum which the U.S. likes in its
milling industry as far as pasta manufacturing is concerned. As
it happened we thrashed the durum and took it into the elevator.
It was graded a number 3CW durum which is a fairly good grade for
the pasta industry. When we started hauling the durum to the
elevator a few pieces of ergot were found in it, which is not
desirable at all.
It was downgraded it to No. 5 durum. This was a setback to my
boys on the farm. It reduced the price of the product and
probably would result in their bottom line being even more in the
red. They took a sample into the U.S. to be analysed and to see
what the Americans would pay for very high quality durum with a
bit of ergot in it.
1535
The Americans took a look at it and said they did not mind, that
they would take the durum. It was a good idea. We could go to
the wheat board and get a buyback. The wheat board would
accommodate us and help us get a better price for the durum. The
Americans offered us $4.55 for the durum within the same distance
of our farm as the Canadian elevator. The initial price is $1.57
for No. 5 durum.
This meant we could triple our income if we could get a licence
to export it to the U.S. When we asked the wheat board for that
export licence, it wanted to charge us $5.12 for durum which they
said was rotten and no good.
This is the way government helps industry and small business. It
gets them on their feet then taxes them to death. If our small
business had the same type of tax relief as other industries in
other countries they would be very viable.
American farmers get a $6 billion tax write-off just because of
depressed prices. That would help every farmer in Canada. Not
only would it help farmers, but they would have money to spend in
rural communities where other small business people would
benefit. As well, more taxes would be earned.
This is what we have come to. The government gives the
perception that it is doing something that is good for the
country when actually it is destroying it with overtaxation, with
trying to keep viable industries that probably should never be
operating.
I want to be very fair. I would like all businessmen or
constituents with the idea of starting their own business to have
that opportunity. The best teacher they could have in life is
running their own business and being their own boss. It gives
them the idea of how many sleepless nights it sometimes takes to
earn a feeble living that is maybe less than they would get from
the payment of wages in another profession.
A level playing field, an opportunity to work within a system
that treats everybody fairly and equally, is a must in democracy.
That is why I urge the government to look at tax reduction and to
look at creating level playing fields rather than giving handouts
which we have seen do not work.
Mr. John Cummins (Delta—South Richmond, Ref.): Mr.
Speaker, it gives me a great deal of pleasure to address the
issue of the availability of financing for small business which
would otherwise not have access to financing.
The reason I am pleased to speak to the issue is that it gives
me an opportunity to advance the notion, as my colleagues have
done, that the problem facing business today is not so much the
availability of financing as it is the management of business and
the high taxes that businesses must endure.
I will give an example of what I mean to talk about. About a
year ago I received a phone call from a fisherman back home, a
gentleman whom I did not know at that time. He had been a long
time participant in the fishing industry but was concerned about
his ability to pay his bills that year, especially the mortgage
on his boat.
He had suffered from a poor catch and poor prices in the 1997
season. To his knowledge he had tried every opportunity or every
avenue for financing that he could. Some help was needed. He
wanted to know if I had any advice for him.
1540
I gave him some directions on some of the lenders of last resort
I know, some of which were government agencies. I suggested that
he try his luck at finding alternate financing for his vessel. He
phoned me back a few weeks later and said that he had been
successful. He had managed to renegotiate a loan and felt that
he would be off the hook and able to survive another year. He
was quite pleased with that.
I obtained a call from that same gentleman a couple of months
ago after the conclusion of the 1998 fishing season, which was a
disaster in British Columbia. Again the request from this
individual was for help. He needed alternate financing for his
vessel. Otherwise he would lose it. I told him that I had given
him the best information last year. If he cannot survive on that
there is not much I can do. The problem is not in the fishery
itself but in the management of the fishery.
Let us take a look at what happened last summer and consider
some of the causes for the concern of the gentleman. On June 19,
1998 the Department of Fisheries and Oceans issued a backgrounder
on the management of the fishery in British Columbia.
The problem last year which the minister expressed endlessly and
with some accuracy was a concern about the viability of coho
salmon, in particular coho salmon on the upper Skeena River and
on the Thompson River. In an effort to minimize catch
opportunities, the minister proposed dividing the coast into
yellow zones and red zones. I will just read what he said on
yellow zones in the backgrounder:
In the yellow zones, recreational fishing will proceed as usual
except all coho must be released.... Barbless hooks must be used
when salmon fishing.
Fishing opportunities will be available in the areas they gave.
Red zones were described as areas where there would be no
fishing. Let me read what he said about red zones:
In red zone areas salmon fishing will be restricted but
opportunities will remain for all other finfish and shellfish
harvesting. Within the red zone small nearshore areas will be
open to carefully monitor fishing salmon in order to determine if
selective fishing for salmon other than coho can be conducted
with the objective of zero mortality for the stocks of concern.
Monitoring by independent observers will be employed to evaluate
the ability to avoid encounters of coho. If coho are encountered
in these small experimental areas, the fishery will be moved or
closed. The location and times of experimental fisheries were
set out.
The backgrounder went on to identify area one on the north coast
including offshore areas. From June 16 to August 26 the waters
of area one were closed to salmon fishing except for the
nearshore areas from the entrance of Masset Inlet to Langara
Island and a three-quarter mile ribbon around the island.
According to the original documents presented by DFO scientists
that whole area on the north coast was considered a red zone. It
is an area where coho were prevalent.
1545
In fact, in one area just off the northern part of the Queen
Charlotte Islands there is a point called Coho Point. That point
was not named because of a lack of coho. It was called Coho
Point because that was an area of some coho prevalence when the
fish were running. That area in the rejigged management scheme
allowed for sport fishing only. It is an area, interestingly
enough, where the Oak Bay Marine Group operates a large fishing
lodge. There are a couple of other lodges that operate in that
area as well.
It seems to me and it seems to many other people that the big
problem here was not a matter of trying to protect coho, but a
matter of trying to provide some sport fishing opportunity for
those people who are rich enough to be able to afford to attend
these lodges. It had nothing to do with protecting fish.
This preference did not stop there. The department decided that
it would promote sport fishing in that area. It says in this
same release that Fisheries and Oceans Canada is working with the
Canadian Tourism Commission, the Sport Fishing Institute and
Tourism B.C. to develop tourism and a marketing campaign aimed at
encouraging recreational fishermen to come to British Columbia.
It says that the CTC, the Canadian Tourism Commission, has
already committed funding of $350,000 for this project and
further federal support is expected shortly. That further
federal support did come and it was in the amount of several
million dollars.
In a sense we should not complain too much. It is federal money
that is designed to help promote British Columbia business. But
let us go back a minute. How is that money going to help the
small boat owner who came to me in 1997 and said he could not
afford to make the mortgage payments on his boat? How is it
going to help that fellow one year later when he came to me and
said “Can you help me? Can you find funding for me again?” It
will not to do him any good.
The fishing records in that area show that the interception of
coho by the commercial fleet in 1997 was minimal. It was
something like 1,000 fish for the whole season. But we have on
record that day after day probably close to 900 coho were killed
in this barbless hook sport fishery in that area. To me that is
a great problem.
It points to another shortcoming of the federal government. The
British Columbia job protection commissioner, in talking about
the problems facing the commercial industry, recommended to
fisheries management that some effort be made to promote the
marketing of B.C. salmon. That is most appropriate because this
fall there were opportunities to fish chum salmon, but there were
no buyers. Fishermen were prepared to go fishing, but nobody was
prepared to buy the fish. That is pretty sad because that is a
top quality food product which was allowed to go unharvested
because there were no markets.
In fact the federal government has made no effort to market
commercially caught salmon in British Columbia. That has to be
seen as a huge problem for the fishing industry and it is one
problem that is not going to be addressed simply by making more
loans available. Making more loans available in the commercial
industry at this time is only going to drive people into the
poorhouse further and faster.
Mr. Grant Hill (Macleod, Ref.): Mr. Speaker, I get little
chance to talk about small business, which of course is the
backbone of our country, and it is a privilege to do that.
It has been fascinating to watch the Ottawa idea about how to
help small business. I think that people in Ottawa say that
small business needs helps and their idea is to organize a
government program for small business.
1550
That is not what I think small business in this country
requires. In fact, in my own community when I ask small business
people what they need they say “The best thing for us would be
to get government out of our way”. I agree with that.
I look for help for small business by getting government out of
the way, by reducing red tape, by removing a lot of the
barricades and barriers to their success.
I will use an example of exactly what I think happens to small
business when government gets in the way. I am using a
provincial example. It has little to do with the federal
government, but it is an example close to my own home and one
that I think illustrates very well the issue of government
interference in the marketplace.
The Alberta government decided that primary resources were not
sufficient, that we should branch out. That, on the surface,
sounds very positive. In looking for secondary industry a
fabulous idea came to the Alberta government.
The idea came from a fellow with a good intellect. He came up
with a concept for smelting magnesium by a very high temperature
electrical process. This was proven by a very, very small
experimental process in a laboratory. It never had any large
scale testing, but he convinced government officials that this
was an extremely useful thing for Alberta.
Alberta had cheap electricity. We had good railroad access to a
community close to my home of Okotoks. There was magnesium ore
not so far away. This would be an absolutely perfect way to
advance the fact that Alberta needed a magnesium industry.
That magnesium, of course, was in use in the automotive industry
for tire rims. It is a light metal, so it is useful for the
automotive industry.
They built what I would charitably call an edifice, the MagCan
plant, halfway between Okotoks and High River in a little
community called Aldersyde, right on the railroad line.
Millions of dollars of taxpayer funds were spent on the
MagCan plant. Charitably speaking, it was a white elephant. I
suppose that if I stood inside the building it would be difficult
in the MagCan plant to take a softball and toss it to the roof.
That is how tall this building was. It was full of expensive
equipment.
They brought magnesium ore all the way from British Columbia and
piled it up. It was quite a sight, glistening in the sun. They
brought in huge amounts of electricity, more electricity than is
needed for a large city. There were huge transformers.
When it came time to put the ore in the smelting process and
flip the switch, it fizzled. It flopped. Zip. Nothing. That
MagCan plant stands today with pigeons flying around this
beautiful edifice of taxpayer funds all because some distant
bureaucrat decided that this kind of process had a good chance of
success. It did not.
Had that individual gone for private resources, they would have
said “Do you think that little experiment on the lab table is
really going to generate the kind of magnesium that we require?
Don't you think we should have a pilot project that might be big
enough to fit into a garage? Don't you think maybe we should
spend $30,000 proving this? Don't you think you should come up
with $30,000 out of your own jeans?”
That is the way successful small business gets organized. This
individual put up not a nickel, not a penny.
I had another person come to me in my riding not so long ago, a
fellow who had a great idea. This idea was to put winglets on
aircraft instead of de-icing fluid. It was a fabulous idea.
De-icing fluid is toxic. These winglets would cover the wings.
When the plane is ready to leave they take them off and there is
no ice, no snow and no need for toxic chemicals.
1555
He said to me “Doc, where do you think I should go for funding?
Is there a government program?” I said “Is there what? You
wouldn't dream of going to a government program with this.
Taxpayers' money should not go into this. This is an investment
opportunity. That is where you should go. I know three
individuals”.
He went to those three individuals and they said to him “The
tax system in this country is so tough that we have taken all of
our speculative funds offshore”. Where did he get his money?
Offshore, away from Canada, away from a fair taxation system
which we do not have, away from the entrepreneurial spirit in
Canada which we do not have. This is a sad story of a young man
with a fabulous idea who had to leave this country. He lived
here, he breathed here, he wanted to pay taxes here, but he had
to leave.
I want to give another example of how Canadian small business is
treated here. We are moving now into an area that is closer to
home for me. We have spent a lot of time going through the
natural health products area over the last while. My personal
philosophy on this issue has been that the public should have
access to natural health products if there is not proven harm,
not proven side effects and not proven contamination. People who
want to look after their health with preventive measures should
be allowed to do that.
To my surprise, I found that the health protection branch, when
it decides for sometimes very arbitrary reasons to stop making a
product available in Canada—it cannot be marketed, sold,
distributed by wholesale or retail and cannot be used—allows the
Canadian consumer a three month personal supply by mail order or
by going to another jurisdiction, in particular the United
States. That is illogical to me. If a product is not safe, it
should say no, ban it and not allow it into the country. If a
product is safe, surely it would allow a Canadian retailer to
market the product.
I have an example of a little pill called Stevia which has just
been taken off the market in Canada. It is a herbal sweetener.
It has nothing to do with anything toxic. People can pop it into
their drinks to sweeten them. But it does compete with another
sweetener. I suspect that might be the reason it would be taken
off the market.
Government getting out of the way of small business and
providing an environment for small business is what we expect.
That is what we look for. That is what small business hopes for.
We do not need more government programs. We do not need
individuals who will tell us to use taxpayers' money in a
speculative manner. That is the last thing Canadians want. It
is the last thing that small business wants. And it is the last
thing that I will vote for.
Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): Mr.
Speaker, today we are debating Bill C-53, the Small Business
Loans Act.
Right now we are debating an amendment at report stage. The
bill has been examined by the committee, has come back to the
House and some amendments have been proposed. This is Motion No.
1. It is an amendment to restate the purpose of the the act. It
states:
The purpose of this Act is to increase the availability of
financing of small businesses, which would not otherwise have
access to financing.
I think that what motivates this bill and this amendment is a
recognition of the fact that capital is in short supply for small
businesses in this country. Of course, capital is what allows
businesses to put infrastructure in place, to put inventory in
place, to have proper computerization, to hire qualified people
and to succeed.
1600
It has long been a concern in this country that for a variety of
reasons small businesses have had difficulty in obtaining the
kind of financing they need. Some people point to the fact that
the big bad banks refuse to a large degree to take a chance on
small businesses. Unless a small business can secure a loan or
prove it does not really need it, a bank will turn down the loan
application. There have been cases that would give merit to that
concern.
The banks have made some strenuous efforts over the last while
to try to address that problem. Many banks have ombudsmen who
re-examine loan application turndowns which are felt to be unfair
and too harsh by small business applicants. There has been some
action on the part of the banks to be more proactive in this area
and to be more responsive to the concerns of small businesses.
The proof of how serious banks are about being more open and more
responsive to the concerns of small business in their need for
financing to some degree remains to be seen but the problem has
been recognized.
This amendment proposes to essentially force banks and lending
institutions to provide loans to small businesses. It states
that the purpose of the act is to increase the availability of
financing of small businesses which would not otherwise have
access to financing. I assume that means banks would have to
make financing available to small businesses that would not be a
good credit risk in the ordinary prudent course of business. We
have to question whether that is a fair and reasonable
requirement to place on the banks. If lending institutions are
forced to provide financing to dubious or shaky business ventures
then everybody will pay the price.
Banks are not some enormous monster in a cave. The banks are
us. Banks are people who own bank stocks. Banks are unions.
Unions have a huge amount of their pension funds invested in bank
stocks. They are pensioners in this country. They are all kinds
of people who have bank stocks. If banks have to essentially
give away money in the form of bad loans or unwarranted loans, we
will all have to pay the price. I do not think a lot of us, our
pensions or our RRSP investments can take that kind of hit.
While I am sympathetic to the plight of small businesses and
their need for financing, the answer is not to have a forced draw
or confiscation of bank moneys in order to finance small
businesses with no ability to convince a reasonable lender of the
merit or soundness of their enterprise or of their ability to
repay loans. Most reasonable Canadians would probably agree with
that.
The question remains of what we should do for our small
businesses that are obviously struggling, that do not have the
necessary resources to keep up with technology or to rent good
premises where they can do booming business. There is a line in
real estate that location is everything. Another is hire the top
people. We all struggle with that almost every day in one way or
another.
My suggestion to this House and to the proposer of this
amendment is that other factors can be addressed to assist small
businesses in this dearth of capital and financing which is a
real problem and a fact rather than forcing private institutions
to cough up money against their better business judgment.
1605
As other speakers have, I suggest that the biggest problem for
our small businesses is that government stands by hovering over
their profits, ready to pounce on them and confiscate a huge
chunk of them as soon as they appear. It is pretty hard for
small businesses to pay the freight when government is sucking
away their proceeds. A large part of the answer is for the
government to examine why small businesses do not have the
capital and finances they need to succeed. A large part of it is
that government is taking too much in taxes.
I would like to concentrate on two taxes which are sucking the
life out of small businesses. These are two payroll taxes, the
CPP payroll tax and the EI payroll tax. Those are the two taxes
the finance minister when he was younger and more objective said
were a cancer on job creation. All of a sudden when the finance
minister wants to look good and wants to look like he is getting
out the red, he decides that putting small businesses in the red
is better than him being in the red. So he takes money from
small businesses partly in the form of payroll taxes to make his
books look good.
Let us look at the facts. By the time the CPP payroll tax is
phased in will cost every business roughly $700 more per
employee. That is in addition to what it will cost the employee.
Let us look at the EI payroll tax. The business will pay $500
per worker more than is required to meet the benefit claims of
the system. In other words, the employer does not pay only the
$500 per worker, but $500 of that is an overcharge necessary to
meet the requirements of the program.
What does the finance minister do? He wants to keep that money.
Why does he want to keep that money? He wants to make his books
look good. He wants to hoard it against an election so he can
dole out to Canadians some nice goodies and say “Are we not
wonderful? Vote for us we will give you everything you want”.
That is the way politics works. What does this do to small
businesses? It sucks the lifeblood out of them. They are paying
$500 per worker more for EI than they ought to. They pay $700
per worker for CPP premiums which may or may not keep a shaky
system in place. Those charges discourage businesses from doing
business. They take money from businesses.
One of my colleagues talked about how his house building
business would lose 25% of its profit because of the CPP payroll
increase alone.
We have small businesses starved for cashflow and starved for
finances. What does the government do? It sucks more money out
of them.
I challenge the government. Rather than put some piece of
legislation in place that has a hearts and flowers approach to
helping small business financing, let small businesses pay
reasonable taxes, keep a lot more of their profits and prosper as
will everybody else. That would be a dimension of this debate
which should be seriously considered by the House.
Mr. Rahim Jaffer (Edmonton—Strathcona, Ref.): Mr.
Speaker, I am pleased to rise to speak on Bill C-53. I will be
restricting my comments to Group No. 1 amendments put forward by
my hon. colleague for Mercier.
Bill C-53, an act to increase the availability of financing for
the establishment, expansion, modernization and improvement of
small business, is this government's attempt to put a band-aid
solution on a problem of access to financing for small business.
1610
The Liberal government has helped to create that problem.
The mandate of the Small Business Loans Act is to facilitate
debt financing for small, young businesses that would not likely
obtain that financing under the current banking oligarchy in
Canada. This mandate, which will be maintained under Bill C-53,
essentially dictates that the government and therefore the
taxpayer should take on more risk than private lenders are
prepared to incur.
The only reason the taxpayer is forced to incur that risk is the
Liberal government has mismanaged and over regulated the banking
industry.
Even with the changes contained within Bill C-53, the taxpayer
still covers 85% of any small business loan defaults. One of the
amendments put forward by my hon. colleague calls on this
taxpayer liability to be reduced to 50%. I am sure members of
this House have enough respect for the average Canadian working
to support this proposal.
Whether the members chose to support or oppose this bill, it
must be remembered that the essential aspect of Bill C-53 is to
provide high risk loans that the private sector cannot or will
not provide.
If members of the House believe this is a fair risk to place on
the shoulders of Canadian families they should support the bill.
If they believe it is an unfair risk to place on the taxpayer
they should oppose the bill. Furthermore, if members believe the
private sector can and should provide small business financing
they should oppose the bill and force the government to make
fundamental changes to the financial services sector.
Two questions immediately came to mind after reviewing this
bill. Why should the taxpayers take on more risk than the banks
and is there no other way to ensure that small businesses have
access to much needed investment capital?
The intervention by the government maintained by Bill C-53 will
remove important market forces from the lending process and will
lead to the funding of less viable business ventures. This may
help to garner political support for the Liberals but will do
nothing to foster a healthy economy.
This government seems to have no concern for average Canadian
families struggling every day under the highest tax burden in the
G-7. Clause 5.1 of Bill C-53 illustrates the government's
indifference to the fact that it is playing politics with the
paycheques of Canadian people.
This section refers to the minister's liability should a loan
not be repaid. However, it is clear that the liability is that of
the Canadian taxpayer. It is not the industry minister's problem
if high risk loans are defaulted on. It is the taxpayers'.
For this reason I fully support the amendment and would include
reference to the taxpayers in the legislation so that it is
transparent to legislators just who is ultimately responsible
should the loans under this act fall to default.
I think the issue of risk should be examined more closely. Risk
is a key element in the proper functioning of a free market. If
it is artificially lessened or eliminated from market
interactions it leads to a misallocation of scare resources. That
is, lending institutions will be less inclined, despite the
provisions for due diligence contained in Bill C-53, to evaluate
the long term viability of a business venture.
This situation will lend itself to the financing of
unsustainable market ventures and it is the taxpayers under this
regime who will inevitably be the losers.
This is supported by the government's own statistics which show
that the default rate under the Small Business Loans Act was
about 5% while the private sector was at approximately 1%. This
is substantial when one considers the amount of money at stake.
The industry department proudly claims that the taxpayer has
only a $1.5 billion liability. This is not an insignificant
amount of money. Canadian taxpayers are at their breaking point.
Someone has to say enough is enough.
Everyone in this House understands the vital role that small
businesses play in the Canadian economy. Many of my colleagues
from the official opposition are small business operators. We
understand the difficulties small business owners face.
I remind the House that high taxes and regulations come first to
mind when I think of how tough it is survive in a small business
climate. If payroll and income taxes were lower, life would be
easier for small business owners.
However, the government does not care enough to do anything about
these problems.
1615
If members of the House wish to stand and talk about their
commitment to small businesses, then they should first return
every cent of the EI surplus. Until that time they have no right
to speak on behalf of small business.
The impact of small business on the Canadian economy is
substantial and Reformers have always supported the needs of
small businesses. However, Bill C-53 is not a debate about
whether small business is valuable, it is a question of whether
small businesses can get access to financing without the
government intervening in the economy.
High risk small business ventures can be financed in a
competitive banking system, provided the lenders are not
unnecessarily restricted from conducting their affairs in a
manner that allows them to incur risk without incurring losses.
It is really that simple.
The Reform Party is committed to getting the government out of
the business of business and out of the pockets of average
Canadian families, but this bill further entrenches the
government's role in the banking industry. We must push
aggressively to change the industry so that small businesses can
get access to financing without the government setting the terms
of that financing.
Bill C-53 and its predecessor the Small Business Loans Act allow
the government to ignore the real obstacles to small business
financing. No more taxpayer dollars should be placed at risk
until the government has made substantial changes to the banking
industry to create real competition.
At this point small businesses' access to finance can be
reviewed and new legislation can be tabled if the government can
demonstrate a legitimate market failure.
The government just cannot seem to get the fundamentals right.
Bill C-53 plays politics with the taxpayers' paycheques. It
demands that the taxpayer take on more risk than the banks by
guaranteeing loans. Let us get the government out of the
business of business and off the backs of the Canadian taxpayers.
[Translation]
The Acting Speaker (Mr. McClelland): Is the House ready for the
question?
Some hon. members: Question.
The Acting Speaker (Mr. McClelland): The question is on Motion
No. 1. Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
Some hon. members: No.
The Acting Speaker (Mr. McClelland): All those in favour will
please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. McClelland): All those opposed will
please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. McClelland): In my opinion the nays have
it.
And more than five members having risen:
The Acting Speaker (Mr. McClelland): Pursuant to Standing Order
76(8), the recorded division on the motion stands deferred.
[English]
Mr. Jim Pankiw (Saskatoon—Humboldt, Ref.) moved:
That Bill C-53, in Clause 4, be amended by replacing line 26 on
page 3 with the following:
That Bill C-53, in Clause 4, be amended by replacing line 33 on
page 3 with the following:
1620
Hon. Alfonso Gagliano (for the Minister of Industry)
moved:
That Bill C-53, in Clause 4, be amended by replacing lines 41 to
45 on page 3 with the following:
That Bill C-53, in Clause 7, be amended by replacing lines 18 to
22 on page 5 with the following:
Mr. Deepak Obhrai (Calgary East, Ref.): Mr. Speaker, as
my colleagues and I said this morning, we oppose the bill. We
gave excellent reasons as to why the official opposition does not
agree with the bill.
We recognize that since we do not have a majority the chances
are that the bill will go through. Therefore, my colleagues have
come up with amendments which will bring more accountability to
this issue and two motions were put forward.
One is to make sure that only one family member receives the
loan. As well the limit is being reduced from $250,000 to
$100,000. The average loan has been $65,000. Reducing the limit
to $100,000 in no way will have a major impact but it will bring
more accountability and ensure that the loan is given to small
businesses.
This morning I read a news item which said that the banks are
going to set up a small business bank. This came out of their
desire to merge. They have said to the small business people
that they will set up a small business bank to address this
issue.
I am glad to see that the banks feel they have to do that. They
have come up with an innovative idea. I think it is a good idea.
They are addressing that issue, but that is the whole point of
what we have been trying to say. The banks have to come up with
innovative ideas to address the issue of small business
financing. It is not a bill like this one under which the banks
can hide and not take any risk and say they are helping small
businesses.
The debate this morning by the official opposition has been that
the private sector and in this particular instance the banks have
to take more responsibility. They have to come up with
innovative ideas on how to finance small businesses. They need
to change their thinking. The banks have to change from thinking
about how much money they can make. The banks must think of how
they can be partners with small businesses to improve the
Canadian economy. That is the thinking that requires change.
I was talking with the vice-president of the CIBC. He said they
understand and realize there needs to be a change in thinking and
that they would be working on it.
I would just tell them that they had better hurry up so that they
do not miss the boat. The official opposition is asking for the
banking sector to open up to more competition.
1625
There are ways the banks can work with small business. As I
said, I have had experience with small businesses. That is why I
am saying that the way the banks can help small business is to
set up advisory councils of business people who can advise the
banks so they can broaden their criteria on how they give out
loans. And here we have another intervention by the state in the
banks through this bill by saying the state is coming in and it
will guarantee the loan. The banks will shirk their
responsibility.
As I mentioned this morning, this kind of financing has been
available for the last 25 years but still there are complaints
out there that small businesses are having a hard time accessing
funds. This bill is not going to solve the problem of financing
for small businesses.
Some good news I mentioned earlier is that the banks want to set
up another institution that will primarily address the needs of
the small businesses. Great. It is a good idea. They should
have done it a long time ago.
In the overall picture the responsibility for the burden on
small business is the economic climate created by the government.
We have made it clear and we are saying it again. The high
level of taxation, which takes into account payroll taxes, the
bureaucratic reporting and the huge amount of paperwork
businesses have to do which is an indirect cost on small
businesses is what leads them to ruin and stops an entrepreneur
from putting time into the business to make it successful.
Business people are asking to be left alone so they can carry on
doing their business. That is what they want to do. Is the
economic climate there for them to do it? No. They are mired by
government bureaucracy. They are mired by reporting structures.
They are mired by this report and that report.
When I started a small business 16 years ago it was great fun.
One would work hard, pay one's little taxes, pay one's employees
and get going. It used to be fun. Today it is not fun. It is
becoming a burden. Today you have to think “Oh man, I have to
send in this report. I have to do this and I have to do that”.
What a change over 16 years in doing business in this country.
The blame lies partly with that side. And I am talking from
experience.
I am telling the government to create the environment and reduce
the taxes. The GST which the Liberals said they were going to
remove is another big headache. The reporting structure of it is
a problem. We need to create the economic climate to let
Canadians do their job and let Canadian businesses try.
1630
The motion we are supporting is an attempt to bring forward
accountability. We hope the banks will not shrink from the
responsibility of addressing the issues. We hope the government
will recognize that it has to create a climate in which small
business can thrive.
Mr. Gurmant Grewal (Surrey Central, Ref.): Mr. Speaker, I
pleased to speak to Group No. 2 which contains Motion Nos. 2, 3,
4 and 5. The bill is about small businesses. If there is a big
storm the big trees fall. Only the grass remains green and
survives a big storm. It is very important that we take care of
small businesses at least as much as big businesses.
I have no difficulty in supporting the motion, but one thing
that is clear is that the Liberal government has had all the
opportunities. Some amendments were brought forward from 1993
and so on, but nothing significant was addressed or taken care of
to enable small businesses to get the benefits the act intended,
not to mention that medium and big businesses borrow money from
it.
The rationale behind Motion No. 2 which we are dealing with is
that it is designed to prevent one family member who is part
owner of a small business from taking out a loan if another
family member has already done so. The idea is that the system
should be more equitable. It should be fairer and should not be
subject to abuse as it has been in the past according to the
auditor general.
According to the Small Business Loans Act each borrower has been
limited to a maximum loan of $250,000. The auditor general
detected a few cases in the sample loan file where certain
individual corporations with substantial common ownership managed
to collectively obtain numerous loans far in excess of the
stipulated maximum loan amount of $250,000.
In one case, according to the auditor general, a group of 23
related corporations managed to collect more than $4 million
under the SBLA. This is a gross abuse of the system. Although
Industry Canada had already notified lending institutions in
writing that such loans would not be covered under SBLA after
July 1996, detection of such cases by the department is difficult
because of the lack of complete access to loan file information
during review of submitted claims. These practices are contrary
to the intent of the act.
The auditor general also noted that while the Small Business
Loans Act specifically defined the eligibility conditions of
those who may borrow under the program, there were no provisions
designed to prevent a group of entities with substantial common
ownership from gaining multiple access to loans under the
program.
The auditor general recommended a clarification of this issue to
ensure the SBLA program meets the goal of providing financial
assistance to smaller businesses within the acceptable risk
exposure of the government.
These practices are contrary to the intent of the act. Currently
there are no provisions under the Small Business Loans Act to
prevent this even though such rules exist under the Income Tax
Act, which has provisions designed to limit access to the low
corporate rate of tax for smaller businesses and to prevent abuse
by the creation of a number of related corporations. More rigor
is needed to address the issue.
We would like to support Motion No. 3. We know that the
government is slow in learning, but I am the one who brought
forward the issue in Motion No. 2 and No. 3 in the first debate
we had on the bill.
I am glad that it is learning but learning slow and I am glad to
support Motion No. 3. The rationale is that the amendment lowers
the maximum amount of a small business loan from $250,000 to the
pre-1993 level of $100,000.
1635
Groups such as Canadian Federation of Independent Business made
presentations before Senate and House committees which called
into question whether the ceiling of $250,000 was too high.
Industry officials concede that the average size of loans made
under the old SBLA was only $65,000. In view of this, present
levels could be trimmed. I am glad the government has learned
that.
The problem of column shifting appears to be more pronounced in
loans over $100,000. This could mean a number of things, but
most likely there is an inverse relation: the larger the size of
a loan to an SME, the smaller the bank's willingness to
underwrite the loan. There is an inverse relation between the
amount of the loan and the willingness of the bank.
From its inception to March 31, 1993 the program made $339
million in net payments to lending institutions over a 32 year
period. Following amendments to the Small Business Loans Act in
1993 the program considerably broadened eligibility criteria and
increased the maximum loan amounts per borrower from $100,000 to
$250,000. The auditor general noted it and it has been
addressed. I am glad that it has been addressed in the bill.
The Canadian Federation of Independent Business which has over
90,000 members has been saying that if the current abuses of the
Small Business Loans Act were curbed and if the parameters of the
program were restricted, the program would require less of an
allocation of funds while being effective in meeting the
program's objective. The thresholds for financing are too high
in the old SBLA. The legislation defines small businesses as
those firms that have up to $5 million in sales. That is not
small.
The CFIB says that we are not talking about small businesses in
this case. What we are talking about is medium or large size
businesses. That becomes an alternative source of financing for
medium and larger businesses, depriving smaller business of the
facilities which are intended for them. Small businesses are not
being given any advantage compared to what medium and larger
firms are getting from Bill C-53.
If the size of the loan and the size of the annual sales of the
business were reduced, we would have a system that serves smaller
businesses. We would also have a system with a drastically
reduced rate of abuse, which is important.
As I said in the beginning the government cares about larger
businesses, not about smaller businesses. When the storm comes,
the government will remember that smaller businesses which are
supporting our economy can survive any type of storm but the big
firms are subject to falling.
The government has been giving big businesses all the big
benefits it could give. We know that Bombardier got $25 million
worth of interest free loans. We know that Bombardier or some
other businesses like it have been getting all those facilities.
Bombardier also got sole source contracts of $2.85 billion from
NATO through the government.
Smaller businesses have been subject to abuse. They have been
subject to high taxes by the government. CPP and EI premiums
have been so high that smaller businesses could not cope. Even
the government knows that $350 per employee and $500 per employer
are being paid too much by the smaller businesses.
I summarize by saying that I am happy to support Motions Nos. 2
and 3. Motions Nos. 4 and 5 are more of a technical nature
rather than of any significant legislative importance. We will
be supporting Motions Nos. 4 and 5 along with Motions Nos. 2 and 3.
1640
[Translation]
The Acting Speaker (Mr. McClelland): It is my duty pursuant to
Standing Order 38 to inform the House that the questions to be
raised tonight at the time of adjournment are as follows: the
hon. member for Regina—Lumsden—Lake Centre, Agriculture; the hon.
member for Tobique—Mactaquac, Asia Pacific Economic Cooperation
Summit; the hon. member for Cumberland—Colchester, Aircraft
Safety; the hon. member for Louis-Hébert, Scrapie.
[English]
Mr. Walt Lastewka (Parliamentary Secretary to Minister of
Industry, Lib.): Mr. Speaker, first I will speak to Motions
Nos. 4 and 5 which reference the Fisheries Improvement Loans Act.
After review of the act it was seen that reference to the
Fisheries Improvement Loans Act was no longer required.
Several small business support programs were restructured in
1987. Fishers became eligible borrowers under the Small Business
Loans Act and no new loans were made under the Fisheries
Improvement Loans Act. Loans that were still outstanding
continued to be administered by fisheries and oceans and
borrowers continued to make payments on those loans. Some 85
loans were still outstanding under the program when the bill was
being developed. It was decided that a reference to the
Fisheries Improvement Loans Act was necessary.
We have subsequently learned that the loans still on the books
under the old Fisheries Improvement Loans Act have declined to a
negligible amount. Given that most of these loans will soon be
paid off the books, reference to the Fisheries Improvement Loans
Act in the proposed Canada Small Business Financing Act is no
longer required. An amendment to the same effect was made to
clause 3 when the bill was at committee. I urge all members of
the House to support these amendments as technical clean-up of
the bill in its references to the fisheries loan act.
There have been many comments with respect to Motion No. 3 which
recommends the reduction of the amount that can be lent to small
business from $250,000 to $100,000. Much of the discussion has
been referenced to the CFIB, that its recommendation was to
reduce the amount to $100,000. The Canadian Federation of
Independent Business surveyed its members and found that over 49%
supported leaving the limit at $250,000. It notified the
standing committee along that line.
I remind everyone here, especially the official opposition, that
other stakeholders like the Canadian Restaurant and Food Services
Association, the Canadian Bankers Association and some
independent witnesses in committee also spoke to maintaining the
$250,000 limit.
There was much discussion on related borrowers which is what
Motion No. 2 addresses. I am surprised the member for
Saskatoon—Humboldt put forward this motion after all the debate
we had in committee including a discussion of the preliminary
regulations. It was agreed among the bankers and the
stakeholders, the CFIB, the Canadian Restaurant and Food Services
Association and the department, that they would look at and come
up with the respective regulation that would follow up on the
auditor general's comments.
1645
This process has started. It is well under way and the
regulations will be issued in due course, after the bill is
approved, hopefully by all members of this Chamber, despite some
earlier comments.
With respect to Motion No. 2, there are some 1,600 deliverers of
what is now known as the SBLA, the future Canada small business
finances act.
Because of the timing for regulation approval and training of
between 1,500 and 1,600 deliverers, this item will be taking
effect, as noted by all the people as discussions were held in
the industry committee.
For that reason, I would not now support going back on what we
had said in committee and on what we had agreed to with respect
to the regulations coming forward to change the items shown in
Motion No. 2.
I wanted to speak to those motions. Hopefully members of the
official opposition will realize that there has been more fine
tuning of this act. The standing committee on industry had great
discussions.
I welcome the new NDP member on the committee, specifically the
member for Kamloops, Thompson and Highland Valleys. I want to
mention his contribution. He took a great interest in this bill
and has shown that he wants to be more involved with small
business.
I hope all of the opposition parties, when the time comes, will
approve this bill for the benefit of small business rather than
for political reasons.
Mr. Werner Schmidt (Kelowna, Ref.): Mr. Speaker, this
amendment is very positive. I would like to refer, in
particular, to the hon. member's comments just now about
“related”.
We need to be very careful about “related” and how we define
it. It is all very well to argue that we are going to have this
very carefully defined through regulation and things of that
sort. I agree that has to be done. However, there are times
when “related” needs to be defined very clearly in the
legislation itself. Perhaps even this definition may fall
slightly short of what is needed.
I want to refer to a practice which has happened. I do not know
how often it has happened, but I know of at least several
instances. A company, which was not such a small business,
needed capital of about a million dollars. It discovered that,
yes, there was a small business loan that it could get. However,
the maximum it could get was $250,000 and it needed $1 million.
With their ingenuity—and a lot of these small business people
are characterized by their ingenuity—they said “How can we do
this?” They divided the company into four subsidiaries. Each
of those subsidiaries qualified for a small business loan.
Subsequently, each of those four businesses borrowed to the
maximum of $250,000. Lo and behold, the full $1 million was
available to the company.
There was common ownership among the four subsidiaries.
Obviously, what was happening was that they met all of the
technical requirements of the regulations and the provisions of
the act; however, they definitely did not meet the spirit or the
intent of the legislation. I believe that is really what is
behind this motion.
1650
I believe that the hon. parliamentary secretary who spoke a
moment ago recognizes full well that that is precisely what is
involved here and I hope this amendment makes that very clear.
The other point we need to recognize, which I want to reinforce,
is the point that was made earlier by my colleague for
Calgary—Nose Hill, which had to do with payroll taxes and the
impact those taxes have on the effectiveness and profitability of
small businesses and their ability to hire people.
She referred to the Canada pension plan. The point that needs
to be added is that over the next four years Canada pension plan
premiums will increase by about 71%. There will be no
corresponding increase in the benefits received by the individual
who subscribes to the pension plan. The difficulty for the
businessman who has an employee is that it will cost him an
additional $700 a year to have that person on the payroll, and
yet the individual does not receive additional benefits. We need
to recognize that this is what is happening.
The other point has to do with EI premiums and the hon. member
covered that point very well. But we need to recognize that when
the two are added together it means that each new employee costs
the small businessman roughly $1,200 a year. That is a very
significant amount of money. That reduces the bottom line by
that amount of money.
I want to draw the House's attention to something I find rather
unique. I discovered it in the November 14 weekend edition of
the Globe and Mail. What struck me was the logo. The BDC
has a new logo. It says “We are a different kind of bank. We
are the small business bank”. The ad reads:
Buy Japan without risking principal. The Business Development
Bank of Canada, Japanese Stock Index Linked Notes, Series 2, due
November 24, 2006. Interest based on 100% of any increase in the
Nikkei 225, Japan's major stock market index. If held until
maturity, principal is fully protected and paid. Direct
obligation of Business Development Bank of Canada, an agent of
Her Majesty and right of Canada. No direct foreign currency
exposure. RRSP eligible as Canadian contact.
For further information, please call CIBC Wood Gundy Securities
Inc. 1-800-563-3193.
In very small print it says:
CIBC Wood Gundy Securities Inc. is a member of the Canadian
Investor Protection Fund and a subsidiary of Canadian Imperial
Bank of Commerce. The Nikkei 225 Index is intellectual property
of Nihon Keizai Shimbun, Inc. (“NKS”) and is compiled and
calculated solely by NKS. “Nikkei 225” is a service mark of
NKS, which licenses the use of the index and the mark to the
issuer of the Notes but does not sponsor or endorse the Notes.
I have a couple of observations. First, in this ad the Business
Development Bank of Canada is offering to sell or make available
to investors and individuals notes that have guaranteed principal
if held to maturity. If we invested $1,000 and we left it until
November 24, 2006, we would be guaranteed the full principal on
the maturity date.
1655
Preliminary investigations suggest that the notes themselves are
backed by a basket of stocks on the Nikkei Stock Exchange, the
Japanese stock market. This suggests that the interest is based
100% on any increase in the Nikkei 225. So if there was no
increase, then only the principal would come back. If there was
a substantial increase, then the value of those notes presumably
would increase by the value of that basket of stocks.
This is interesting. It looks to me that these are Japanese
stocks that are being talked about, yet it says clearly that
there is no direct foreign currency exposure nor is there foreign
content. It is RRSP eligible as Canadian content. This is an
interesting ad. It requires a lot more study before we get into
the detail of what is going on.
I would also refer to the CIBC Wood Gundy Securities Inc., which
is a subsidiary of the Canadian Imperial Bank of Commerce. We
know that last week the CIBC advised the world and all of its
shareholders that in the previous quarter its profit had dropped
by 70%, largely as a result of its unsuccessful operation within
the investment market.
I am not suggesting that there will necessarily be bad
performance. However, the BDC is acting as an agent of the
crown, an agent of the Government of Canada, which means that if
the stock market goes down, as it did recently, in November 2006,
the Canadian people will be responsible for the full principal
that has been invested.
If this is a different kind of bank, a bank for small business,
I would like to know what in the world is going on. It is
incumbent upon the Minister of Industry and the Minister of
Finance and even the Prime Minister to look at this and ask
“What are we doing with this kind of a corporation in Canada?”
[Translation]
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, from the very
start of the debate, I have been hearing our Reform colleagues
say that if taxes and wages were lower, small businesses would
be doing just fine, and that in any case government guaranteed
loans were not needed when businesses were sound.
With all due respect, unless the situation out west is very
different from that in Quebec, what they are saying does not fit
in with the needs of small businesses.
In a number of sectors, start-up or expanding companies represent
a risk. Members who were with me when bankers appeared before us
know that, every time we asked them about start-up companies,
they said that there was indeed a risk, that a new venture is
always a risk. An expanding business needs room to grow and this
also represents a risk.
I believe that the thrust of the bill is to ensure that, when a
small business which is considered a risk but has a reasonable
chance of being successful cannot get a loan, the government
steps in to guarantee the loan. This is the intent of the bill.
I might have been the first one to say that small businesses
should pay lower EI premiums, but I will never say that lowering
them means that start-up or expanding companies no longer need
the Small Business Loans Act.
1700
The same thing goes for lower wages. We are not looking to
create an economy based on lower wages. What we want is an
economy where small businesses about to start up choose to
operate in sectors where work is highly paid and people can earn
a decent living. You can be sure that developed countries and
nations enjoying stronger growth have not relied on low wages.
Although I feel I need to defend this bill against the attacks
of my Reform colleague, I also want to tell my Liberal
colleagues that they could have done a much better job of it. In
fact, this bill is supposed to help small businesses, but what
we have seen is some kind of negotiations with the banks and the
big franchisors.
It is important to understand that we need the banks to lend the
money and to compel them to meet a number of conditions, that
the loan guarantee cannot be seen as their chance to get some
bad loans paid back, which is why the spirit of the legislation
has to be clearly stated. Unfortunately, nowhere can it be found
in this bill.
Nowhere in the bill before us is the spirit of the legislation
mentioned. The regulations previously included in the
legislation have been withdrawn. The committee agreed to ensure
that the regulations would not be changed without prior
consultation of the parties and the committee. We hope things
will stay that way. The regulations really reflect the spirit of
the legislation.
Here are some of the points we, in the Bloc Quebecois, want to
make about these amendments.
The first point that we will continue to make is that the
purpose of the act must be stated in the act. We will also make
the point that, in assessing the act, we must not only ask
ourselves if the total cost of the loans will be paid by the
borrowers.
There are fundamental questions that must be asked. What is the
effect on the economy? What is the effect on employment as well
as on the survival and the growth of small and medium size
businesses?
When a loan application is denied, when a prospective business
is denied access to a loan and cannot start up as a result, how
much does it cost to our economy? How much does it cost in terms
of money that is not being injected into our economy? How much
does it cost in terms of social spending for the person who is
unemployed? We must take into account the costs of a business
not being able to get off the ground as well as the risk of
problems for small and medium size businesses.
We will make that point. We will also make the point that pilot
projects must include working capital.
Everybody knows that the financing of working capital is almost
an essential requirement for a business that wants to start up
or to grow. We agree that it is not appropriate to use this
general program to finance working capital. However, we think
there should be at least a pilot project where working capital
would be guaranteed, but the business receiving the loan would
also receive management counselling.
1705
A number of my colleagues and I sent out simple questionnaires
to our small and medium-sized businesses. One of the things we
asked was: “In your opinion, if credit were easier to get, would
the growth of your business be better, and would the risk of
bankruptcy be lower?” Many of the respondents said “Yes”. The
reason we asked this is that, in our experience, small and
medium-sized businesses often do not manage to hang on for more
than a year and a half, two years, two years and a half, because
of administrative problems, yes, but also because they often
have financing problems.
The Canadian Federation of Independent Business had good reason
to say that this is a very significant problem for more than 29%
of businesses.
This is why we are going to defend these points which will help
advance the financing of small and medium-sized businesses.
It is worthwhile pointing out at this time that loans for
equipment account for 73.4% of the total, loans for land, 12.8%,
and loans for commercial space, 12.8%. It seems to me that this
should help our colleagues beside us understand the importance
of this bill, because equipment is what enables the company with
some commercial space, whether or not it owns the land, to get
started up.
Sometimes the business also needs to finance its working
capital.
Businesses which have to purchase products for use in their
production, to purchase raw materials to be manufactured, and
then sell their products perhaps without any return for three
months, may fail, despite all their spanking new equipment,
their employees, because they lack the working capital.
We ask that all this be looked at in order to improve the bill,
and not to make it unworkable, as my colleagues next to us would
like to do.
[English]
Mr. Jim Gouk (Kootenay—Boundary—Okanagan, Ref.): Madam
Speaker, I have a couple of points I would like to raise under
Group No. 2. One deals with some of the comments made by the
hon. member from the Bloc who just spoke. The other deals with
comments made by the government side.
Starting with the comments on the government side, members said
they held their committee hearings, listened to people across the
country and got a particular input from those people. But then
later they said there were supplemental letters to the committee.
I am not aware of these. I have seen what was presented at
committee and I have not gone beyond that. In that committee
many groups, including the Canadian Federation of Independent
Business, specifically said they thought the ceiling on this was
too high.
I go back to a time when I was on the transport committee. There
was one particular blatant piece of legislation that I recall,
the Canadian Transportation Act. On that we had a tremendous
number of interveners from across this country, from one end to
the other. A huge majority of them, in the 90% range, were
opposed to clause 27. They were clearly against it and they went
on at great length to explain why they were opposed to it. I made
an amendment at committee to delete that clause which was so
objectionable to so many people.
I found it incredibly interesting that not one of the government
members supported that amendment to delete that clause of the
bill.
When the hon. member from the government said that the Canadian
Federation of Independent Business amended its position after
consultation with its membership, I do not know if he misspoke
but he gave a figure that less than a majority was in favour of a
higher ceiling.
1710
It is most curious that he used a figure of less than 50%
because it automatically implies that more than 50% still wanted
that lower ceiling.
The member from the Bloc made reference to how the Reform Party
says the answer to this is lower taxes and lower salaries. She
is half right, which is probably not bad on an average day. We
certainly think there should be less tax. No one has suggested
that people should get paid less as the answer to businesses
making more profit. We would like to see people making more
profit and able to buy more things which means they should have
more disposable income.
We have for a long time been very clear about disposable income
and the ability of a Canadian business to compete and to sell its
products cheaper by all means, but not by cutting profits. Most
cannot cut their profit as most of it has already been taken
away.
I refer to the speech I made earlier today. I hope the hon.
members listening were privy to that. I used an example of my
being in small business just prior to being elected. I was in
the construction business and the results of the increase of the
CPP tax alone accounted for two of the eight houses I built each
year; 25% of my gross profits, not for all payroll taxes, not
even for all the cost of the CPP. This was just for the amount
that this government was increasing it by, 25% of my gross
profit, $12,000 a year.
I carry a dandy little device, a financial analyst calculator.
While I was listening to the hon. member speak I pulled my
calculator out of my briefcase and quickly calculated the $1,000
a month, which is what the government would have taken out of my
pocket were I still operating my small business just for the
increase in the CPP alone. I calculated the amount at 9%
interest which is pretty nominal for a small business trying to
get a loan these days. I amortized it over a 10 year period,
compounded semi-annually, which is the normal banking practice.
It would have required a loan of $80,000.
What we are saying is that the problem with this whole bill with
its $250,000 limits, government guarantees and high ratios which
we will get into in part three of this debate, is that it
suggests we have to give more money and back up more. What we
have to do is stop taking money away. I do not care if we are
talking in terms of intent, in terms of how high a ceiling we
should put on this or what ratio we should guarantee. The best
way to help businesses is to stop taking their money. We should
not be creating legislation that makes it easier for them to
borrow money to give to the government.
As a small business operator, if I had to maintain my gross
revenue income flow to pre-CPP tax increase levels I would have
to go to the bank and borrow $12,000 a year. Over the course of
10 years I could take and amortize with interest a loan of
$80,000. That is $120,000 with interest payments added up that
my business would have to put out in order to come up with the
money the government would take out of my pocket for the CPP
increase alone.
The problem in this bill is not whether the whole ceiling should
be lowered. It is the government's approach to the idea of what
small business needs. It somehow thinks that it is all right to
fix the whole problem in our economy by making it easier for
business to borrow money.
We will repeat in each section of this bill that the true way to
solve the problem for small business is to leave the money in
that business.
I remember back in the late 1970s the banking industry decided
this was a pretty vibrant economy and it could make tons of money
by just getting businesses and individuals to borrow more.
Contrary to what we have now where we have to go on bended knee
and beg the banks to loan us money, in the late 1970s they were
begging people to take it. Because it was so easy and they made
it sound so great, people borrowed more and more.
1715
They wanted to borrow $50,000 to buy a used machine they saw.
They felt they should be able to borrow $125,000 and buy a new
one. This was no problem. They would write a cheque right then.
That is what this government is leading people toward. The
government has increased the cost to operate business then makes
it easier for these businesses to borrow money. We get into a
vicious cycle.
This government and Liberal governments in the past, all
governments past, the old style politics of Canada operated by
the two principal parties that have occupied this House, have
often in many parts of Canada created a dependency on government.
They have created that for businesses and individuals and they
have created it for entire regions of this country. They created
dependency for a race of people, a culture of people, through the
Indian and northern affairs legislation and acts of that branch
as well.
Now this government is trying to do it once again. This
government is trying to get businesses on hook to the generosity,
in its view, of the Liberal government through a loans program.
There is something wrong when the government thinks that the
first thing it has to do is tax away everyone's money then turn
around and loan some back. It will arrange to have some of it
loaned back. The government will guarantee it. That is mighty
generous of the government considering what it is really
guaranteeing is individuals' own money. The government took the
money from them in the first place. The amount the government
stands to lose can be paid out of the CPP increase alone.
I think we should be lowering those limits. The majority of
people who borrow money, the majority of businesses that borrow
money, traditionally borrow on average far less than what we
would like to see that ceiling reduced to, partly in response to
many of the groups that spoke in committee. We think that is
good.
The real way to solve the problem, which the government will
hear a lot and I hope it sinks in, is that it will have to
recognize that borrowing money to overcome oppressive taxes is
not the answer to getting the economy going in this country
again.
The government should deal with all businesses by ensuring that
they get to keep some of that money in their pocket. Businesses
earned it. It belongs to them. The government has not earned
it. Unlike the thinking of the finance minister the money does
not belong to the government.
Mr. Ted White (North Vancouver, Ref.): Madam Speaker, we
are talking about Motion Nos. 2 and 3.
Anyone who has ever applied for loans probably found it
disappointing if they were turned down. It would be unusual if
at some time in our lives when we applied for a loan we were not
been turned down. It is not always because the idea was not good
or the product we wanted to buy was not a decent product but it
could just be because the proposal or our income was not
sufficient to support the loan.
This does not remove the disappointment but one of the things
this bill does is facilitate dependency by groups of businesses
that cannot qualify through the normal lending channels. That is
one of the thrusts we have been talking about today.
The government is going about financing small business the wrong
way. What the government is doing is building a dependency where
people who cannot get money through a regular bank can go through
the back door by having taxpayers guarantee the loan.
Earlier today when I was speaking on the first group of
amendments, I was talking about the alternatives that can be used
to get around that. It is not a problem that these businesses
cannot get money. Businesses can always get money. But it is
the problem of there being a price to be paid for it. Sometimes
these people do not want to pay the price.
When it is a new business, a risky venture, it may be a good
idea but the banks have never seen it before. Individuals
approach various banks and the banks say they have never seen any
history of this type of business and do not think they can make
it and they do not qualify.
Those individuals are not satisfied that they cannot get the
money from the banks. But there are alternatives out there if
they pay a bit more in interest.
We have had examples today from some of my colleagues of
businesses that were started with borrowed money from friends or
from a venture capitalist. I explained that my business, prior to
being a member of parliament, was specializing in the financing
of home based businesses. Certainly we lent the money out at an
interest premium to the banks because we were filling that niche
of handling that risky area of business.
1720
The biggest problem we had as a small company involved in that
financing sector was that when we used mortgages as a guarantee
the government considered us to be in an investment business and
it taxed us at a 50% rate on our profits. That took away our
ability to reinvest in these people. Yet we were willing to make
all sorts of creative financing options for people that made it
possible for them to get into business. In the five years we ran
the leasing business prior to my becoming a member of parliament
we never had a single loss.
Yet we always took on businesses that could not get financing at
the regular places. All it took was a little creativity. Instead
of going through the normal procedure a bank might go through of
making people fill out pages and pages of information about their
personal financial history and being unable to prove they had a
previous background, we would look instead for stability and
trustworthiness.
We did that in a very simple way. We had five telephone
directories in our office that went back five years. The first
thing we did when a person called and asked for lease financing
was look in those telephone directories to see if the person had
lived in the same place for five years. If they had, that gave
us the first good clue that the person was stable, reliable and
would be there.
Second, we asked applicants for their job histories. Had they
worked at the same place for a good length of time, four or five
years? A second clue that they were trustworthy, reliable and
would not run away would be if they had the same job for five
years, had just been laid off and thought they would get into
business for themselves. If we leased them a fax machine or a
photocopier they would not just run away and disappear out of
sight.
Third, we asked if we could do a credit check on their credit
cards to find out if they were up to their limit. If the people
going into business were not up to their credit card limits, that
indicated they were not yet under financial stress.
Those were all good signs, being in the phone book for five
years, having a good steady job prior to going into business for
themselves and having credit cards that were not maxed. If these
criteria were met they got their loans. That is all we did.
There was no indepth financial investigation of their pasts. We
just looked for reliability, trustworthiness and a sense these
people would not run away if something went wrong.
Of course a portion of the loans we made started to go bad.
People would miss payments. Because these people were
trustworthy and believed in their ideas we could approach them,
talk with them and make arrangements for them to catch up. They
could find alternative positions, to sell the equipment or to
make adjustments to their portfolios.
That sort of creativity is possible but because the government
taxed away so much of what we made from this exercise we were
robbed of capital to expand. The demand for what we could do was
much greater than what we could ever fill.
The government response is to build dependency by providing
money at a bank market rate by making taxpayers carry the can on
any defaults. It was mentioned earlier that only a small
percentage are in default. It is about 5.6% to 6%. The
aggregate amount that can be paid out under this program is $1.5
billion. A default rate of 5.6% amounts to about $75 million
under default at any particular time. That is a significant
chunk of money. We should be pretty concerned about the
liability faced by taxpayers when they are guaranteeing these
sorts of loans.
That is why the amendments proposed in Group No. 2 are being put
forward. Motion No. 2 makes sure no loans are made to relatives
of the initial borrower to put more money into the same business.
It is not right to use a loophole to get around the intent of
the act. If we have decided a business can borrow a certain
amount it is not right to allow relatives working in the same
business to borrow their share and to increase the total amount
being risked on a particular business. That was the reason we
introduced this amendment stating the loan must not be in
addition to other loans made under this act to persons related to
the borrower for the operation of the same small business. More
than two of my colleagues have given examples found by the
auditor general of abuse in this area.
1725
The other amendment we put forward is that the amount given to
the borrower does not exceed $100,000. Industry officials had to
admit that the average loan size was $65,000, which is still a
reasonable chunk of change for people starting a small business.
Borrowing $250,000 for the average person is a lot of money.
That is more than starting a small business. There really is no
need to go to that level. Restricting it to $100,000 is quite
enough, especially if the minister will not agree to preventing
this multiple borrowing we are trying to correct with Motion No. 2.
I urge members to support the Reform motions and if they do they
will significantly improve the bill.
Mr. Keith Martin (Esquimalt—Juan de Fuca, Ref.): Madam
Speaker, it is a pleasure to speak on Bill C-53, Motions Nos. 2
and 3.
We have gone through this before. The government is nibbling
around the edges. The bill unfortunately will not address the
problems affecting the private sector by any meaningful way. I
will continue with the speech I was making earlier on
constructive solutions that can be applied to the bill if the
government would listen. It would find there would be widespread
agreement among the electorate.
There are various things the government can do with respect to
labour policy. It can work with the provinces. I challenge the
ministers across the way to call their provincial counterparts
together to deal with the issue of labour policies which are
having a restricting effect on the ability of the private sector
to function as well as it can.
Unionization techniques are being done to quite significantly
restrict productivity. Certain things can be implemented. For
example, there is the aspect of members taking a strike vote. The
strike vote or a vote on whether to unionize should be a silent
or anonymous vote rather than public. Often strong arm tactics
are used on members to vote for unionization or a strike. That
should be done by a secret ballot system.
The aspect of sexual bargaining should be banned, as this also
restricts the private sector.
It is really horrible that we have not been able to address
these significant problems that have been beleaguering the
private sector for so long.
The government has an enormous role to play regarding industrial
policy in reduction of interprovincial trade barriers. We had an
opportunity to do that in this House and rather than taking
meaningful measures to reduce interprovincial trade barriers the
government once again nibbled around the edges.
The private sector says we have more boundaries east-west in
Canada than we have north-south. In part that can explain the
reason why, although we have implemented free trade agreements,
they have not been as good as they can become because the
Government of Canada has actually impeded and impaired the
ability of the Canadian private sector to be competitive with its
counterpart south of the border because it has not done much with
removing the interprovincial trade barriers that hamstring them
so badly. I would encourage it to do that.
By eliminating direct subsidies to businesses we can save
taxpayers a lot of money. They really are not necessary because
the private sector does not want the money. It wants the
environment that will enable it to be productive.
We have a fetish for introducing regulations but have little
desire to remove them. British Columbia has enacted 3,000 new
regulations since the government was elected.
The Acting Speaker (Ms. Thibeault): I must interrupt the
hon. member. When the bill is brought back before the House for
debate he will have approximately six minutes left.
* * *
1730
[Translation]
CRIMINAL CODE
The House resumed from November 5 consideration of the motion
that Bill C-51, an act to amend the Criminal Code, the Controlled
Drugs and Substances Act and the Corrections and Conditional
Release Act, be read the third time and passed.
The Acting Speaker (Ms. Thibeault): It being 5.30 p.m., the
House will now proceed to the taking of the deferred division on
the motion at third reading of Bill C-51.
Call in the members.
1800
[English]
(The House divided on the motion, which was agreed to on the
following division:)
YEAS
Members
Adams
| Alarie
| Anderson
| Assad
|
Assadourian
| Asselin
| Augustine
| Axworthy
(Saskatoon – Rosetown – Biggar)
|
Axworthy
(Winnipeg South Centre)
| Bachand
(Richmond – Arthabaska)
| Bakopanos
| Barnes
|
Beaumier
| Bélair
| Bélanger
| Bellehumeur
|
Bellemare
| Bennett
| Bergeron
| Bernier
(Tobique – Mactaquac)
|
Bertrand
| Bevilacqua
| Bigras
| Blondin - Andrew
|
Bonin
| Bonwick
| Borotsik
| Boudria
|
Bradshaw
| Brien
| Brison
| Brown
|
Bryden
| Bulte
| Byrne
| Caccia
|
Calder
| Cannis
| Caplan
| Cardin
|
Carroll
| Casey
| Catterall
| Cauchon
|
Chamberlain
| Charbonneau
| Chrétien
(Frontenac – Mégantic)
| Clouthier
|
Cohen
| Collenette
| Comuzzi
| Copps
|
Crête
| Cullen
| Dalphond - Guiral
| Davies
|
de Savoye
| Debien
| Desrochers
| DeVillers
|
Dhaliwal
| Dion
| Discepola
| Doyle
|
Dromisky
| Drouin
| Dubé
(Lévis - et - Chutes - de - la - Chaudière)
| Dubé
(Madawaska – Restigouche)
|
Duceppe
| Duhamel
| Dumas
| Earle
|
Easter
| Eggleton
| Finestone
| Folco
|
Fontana
| Fry
| Gagliano
| Gagnon
|
Gallaway
| Gauthier
| Girard - Bujold
| Godfrey
|
Goodale
| Graham
| Gray
(Windsor West)
| Grose
|
Guarnieri
| Guay
| Guimond
| Harb
|
Hardy
| Harvard
| Harvey
| Herron
|
Hubbard
| Ianno
| Iftody
| Jackson
|
Jennings
| Jordan
| Karetak - Lindell
| Karygiannis
|
Keddy
(South Shore)
| Keyes
| Kilger
(Stormont – Dundas)
| Kilgour
(Edmonton Southeast)
|
Knutson
| Kraft Sloan
| Laliberte
| Lalonde
|
Lastewka
| Laurin
| Lavigne
| Lebel
|
Lee
| Lincoln
| Longfield
| Loubier
|
MacAulay
| MacKay
(Pictou – Antigonish – Guysborough)
| Mahoney
| Malhi
|
Maloney
| Manley
| Marceau
| Marchand
|
Marleau
| Martin
(LaSalle – Émard)
| Martin
(Winnipeg Centre)
| Massé
|
Matthews
| McCormick
| McDonough
| McGuire
|
McKay
(Scarborough East)
| McLellan
(Edmonton West)
| McTeague
| Ménard
|
Mifflin
| Mills
(Broadview – Greenwood)
| Minna
| Mitchell
|
Muise
| Murray
| Myers
| Nault
|
Normand
| Nunziata
| Nystrom
| O'Brien
(London – Fanshawe)
|
O'Reilly
| Pagtakhan
| Paradis
| Parrish
|
Patry
| Peric
| Peterson
| Pettigrew
|
Phinney
| Picard
(Drummond)
| Pickard
(Chatham – Kent Essex)
| Pillitteri
|
Plamondon
| Power
| Pratt
| Price
|
Proctor
| Proud
| Provenzano
| Redman
|
Reed
| Richardson
| Riis
| Robillard
|
Robinson
| Rocheleau
| Rock
| Saada
|
Scott
(Fredericton)
| Sekora
| Solomon
| Speller
|
St. Denis
| Stewart
(Brant)
| Stewart
(Northumberland)
| St - Jacques
|
St - Julien
| Szabo
| Telegdi
| Thibeault
|
Thompson
(New Brunswick Southwest)
| Torsney
| Tremblay
(Rimouski – Mitis)
| Ur
|
Valeri
| Vanclief
| Vautour
| Volpe
|
Wappel
| Wasylycia - Leis
| Wayne
| Whelan
|
Wilfert – 205
|
NAYS
Members
Ablonczy
| Anders
| Bailey
| Benoit
|
Breitkreuz
(Yellowhead)
| Cadman
| Casson
| Chatters
|
Cummins
| Duncan
| Epp
| Forseth
|
Gilmour
| Goldring
| Gouk
| Grewal
|
Grey
(Edmonton North)
| Harris
| Hart
| Hill
(Macleod)
|
Hill
(Prince George – Peace River)
| Hilstrom
| Hoeppner
| Jaffer
|
Johnston
| Kenney
(Calgary - Southeast)
| Lowther
| Lunn
|
Manning
| Martin
(Esquimalt – Juan de Fuca)
| Mayfield
| McNally
|
Meredith
| Morrison
| Obhrai
| Pankiw
|
Penson
| Ramsay
| Reynolds
| Ritz
|
Schmidt
| Scott
(Skeena)
| Solberg
| Stinson
|
Strahl
| Vellacott
| White
(Langley – Abbotsford)
| White
(North Vancouver)
|
Williams – 49
|
PAIRED
Members
Alcock
| Bachand
(Saint - Jean)
| Baker
| Bernier
(Bonaventure – Gaspé – Îles - de - la - Madeleine – Pabok)
|
Canuel
| Chan
| Coderre
| Finlay
|
Fournier
| Godin
(Châteauguay)
| Lefebvre
| Leung
|
Marchi
| Mercier
| O'Brien
(Labrador)
| Perron
|
Sauvageau
| Serré
| Shepherd
| Steckle
|
St - Hilaire
| Venne
|
The Speaker: I declare the motion carried.
(Bill read the third time and passed)
PRIVATE MEMBERS' BUSINESS
[English]
CANADA STUDENT LOANS
The House resumed from November 5 consideration of the motion.
The Speaker: Pursuant to order made on Thursday, November
5, the next deferred recorded division is on Motion No. 132.
We will vote again under our relatively new system. Because the
mover is on my left, those in favour of the motion in the rows to
my left starting with the fifth row and moving to the front will
vote and then we will go to the other side.
1810
(The House divided on the motion, which was negatived on the
following division:)
YEAS
Members
Axworthy
(Saskatoon – Rosetown – Biggar)
| Bachand
(Richmond – Arthabaska)
| Bernier
(Tobique – Mactaquac)
| Borotsik
|
Brison
| Caccia
| Casey
| Cummins
|
Davies
| Doyle
| Dubé
(Madawaska – Restigouche)
| Earle
|
Hardy
| Harvey
| Herron
| Keddy
(South Shore)
|
Laliberte
| MacKay
(Pictou – Antigonish – Guysborough)
| Martin
(Winnipeg Centre)
| Matthews
|
McDonough
| Muise
| Nunziata
| Nystrom
|
Power
| Price
| Proctor
| Riis
|
Robinson
| Solomon
| St - Jacques
| Thompson
(New Brunswick Southwest)
|
Vautour
| Wasylycia - Leis
| Wayne – 35
|
NAYS
Members
Ablonczy
| Adams
| Alarie
| Anders
|
Anderson
| Assad
| Assadourian
| Asselin
|
Augustine
| Axworthy
(Winnipeg South Centre)
| Bailey
| Bakopanos
|
Barnes
| Beaumier
| Bélair
| Bélanger
|
Bellehumeur
| Bellemare
| Bennett
| Benoit
|
Bergeron
| Bertrand
| Bevilacqua
| Bigras
|
Blondin - Andrew
| Bonin
| Bonwick
| Boudria
|
Bradshaw
| Breitkreuz
(Yellowhead)
| Brien
| Brown
|
Bryden
| Bulte
| Byrne
| Cadman
|
Calder
| Cannis
| Caplan
| Cardin
|
Carroll
| Casson
| Catterall
| Cauchon
|
Chamberlain
| Charbonneau
| Chatters
| Chrétien
(Frontenac – Mégantic)
|
Clouthier
| Cohen
| Collenette
| Copps
|
Crête
| Cullen
| Dalphond - Guiral
| de Savoye
|
Debien
| Desrochers
| DeVillers
| Dhaliwal
|
Dion
| Discepola
| Dromisky
| Drouin
|
Dubé
(Lévis - et - Chutes - de - la - Chaudière)
| Duceppe
| Duhamel
| Dumas
|
Duncan
| Easter
| Eggleton
| Epp
|
Finestone
| Folco
| Fontana
| Forseth
|
Fry
| Gagliano
| Gagnon
| Gallaway
|
Gauthier
| Gilmour
| Girard - Bujold
| Godfrey
|
Goldring
| Goodale
| Gouk
| Graham
|
Gray
(Windsor West)
| Grewal
| Grey
(Edmonton North)
| Grose
|
Guarnieri
| Guay
| Guimond
| Harb
|
Harris
| Hart
| Harvard
| Hill
(Macleod)
|
Hill
(Prince George – Peace River)
| Hilstrom
| Hoeppner
| Hubbard
|
Ianno
| Iftody
| Jackson
| Jaffer
|
Jennings
| Johnston
| Jordan
| Karetak - Lindell
|
Karygiannis
| Kenney
(Calgary - Southeast)
| Keyes
| Kilger
(Stormont – Dundas)
|
Kilgour
(Edmonton Southeast)
| Knutson
| Kraft Sloan
| Lalonde
|
Lastewka
| Laurin
| Lavigne
| Lebel
|
Lee
| Lincoln
| Longfield
| Loubier
|
Lowther
| Lunn
| MacAulay
| Mahoney
|
Malhi
| Maloney
| Manley
| Manning
|
Marceau
| Marchand
| Marleau
| Martin
(Esquimalt – Juan de Fuca)
|
Martin
(LaSalle – Émard)
| Massé
| Mayfield
| McCormick
|
McGuire
| McKay
(Scarborough East)
| McLellan
(Edmonton West)
| McNally
|
McTeague
| Ménard
| Meredith
| Mifflin
|
Mills
(Broadview – Greenwood)
| Minna
| Mitchell
| Morrison
|
Murray
| Myers
| Nault
| Normand
|
Obhrai
| O'Brien
(London – Fanshawe)
| O'Reilly
| Pagtakhan
|
Pankiw
| Paradis
| Parrish
| Patry
|
Penson
| Peric
| Peterson
| Pettigrew
|
Phinney
| Picard
(Drummond)
| Pickard
(Chatham – Kent Essex)
| Pillitteri
|
Plamondon
| Pratt
| Proud
| Provenzano
|
Ramsay
| Redman
| Reed
| Reynolds
|
Richardson
| Ritz
| Robillard
| Rocheleau
|
Rock
| Saada
| Schmidt
| Scott
(Fredericton)
|
Scott
(Skeena)
| Sekora
| Solberg
| Speller
|
St. Denis
| Stewart
(Brant)
| Stewart
(Northumberland)
| Stinson
|
St - Julien
| Strahl
| Szabo
| Telegdi
|
Thibeault
| Torsney
| Tremblay
(Rimouski – Mitis)
| Ur
|
Valeri
| Vanclief
| Vellacott
| Volpe
|
Wappel
| Whelan
| White
(Langley – Abbotsford)
| White
(North Vancouver)
|
Wilfert
| Williams – 218
|
PAIRED
Members
Alcock
| Bachand
(Saint - Jean)
| Baker
| Bernier
(Bonaventure – Gaspé – Îles - de - la - Madeleine – Pabok)
|
Canuel
| Chan
| Coderre
| Finlay
|
Fournier
| Godin
(Châteauguay)
| Lefebvre
| Leung
|
Marchi
| Mercier
| O'Brien
(Labrador)
| Perron
|
Sauvageau
| Serré
| Shepherd
| Steckle
|
St - Hilaire
| Venne
|
The Speaker: I declare the motion defeated.
1815
The Acting Speaker (Mr. McClelland): The House will now
proceed to the consideration of Private Members' Business as
listed on today's order paper.
* * *
[Translation]
CANADIAN HUMAN RIGHTS ACT
Ms. Diane St-Jacques (Shefford, PC) moved that Bill S-11, an act
to amend the Canadian Human Rights Act in order to add social
condition as a prohibited ground of discrimination, be read the
second time and referred to a committee.
She said: Mr. Speaker, it is with emotion and hope that I
initiate today the second reading debate on Bill S-11, an act to
amend the Canadian Human Rights Act in order to add social
condition as a prohibited ground of discrimination.
I would like to be able to start my presentation by stating that
we have every reason to be proud of living in this country
because Canada is internationally recognized as one of the
leading proponents of human justice, as a country whose society
is said to acknowledge every human being's right to dignity,
respect and equal opportunities. Unfortunately, I cannot make
such a statement because nothing could be further from the
truth.
As governments in this country concentrate their energies on
reducing the budget deficit, the equality deficit caused by
poverty in the form of discrimination is being overlooked. While
being increasingly recognized on the international scene as a
human rights issue, poverty remains one of the main barriers to
equality in Canadian society.
Indeed, Canadians who, because they are poor, are excluded from
the social, economic and cultural life the rest of us enjoy are
often treated like second class citizens. The everyday reality
of many Canadians, living in poverty generally means lack of
food, substandard housing, increased vulnerability to illness
and systemic barriers to schooling and employment.
But, to add insult to injury, there is more to this horrific
state of affairs.
1820
In addition to having to endure the material hardships that
accompany poverty, poor Canadians are always having to face
ostracism and negative stereotyping in their dealings with
financial institutions, owners, businesses and their staff,
officials, the legal system, neighbours and strangers and in the
media.
Canadian society is indeed intolerant of the poor. This
disparaging treatment is in part fed by the generalized
obsession with the debt and the deficit, as I mentioned.
Canadians who depend on social programs in order to live are
disparaged and humiliated by taxpayers as a whole.
The conclusion is self evident. Disparagement of the poor
promotes discrimination against them. In other words, I would
say they are faulted in a way for being poor.
Despite this general attitude, I am convinced that many
Canadians would be upset to see how financial institutions treat
the poor.
Although I recognize the recent efforts by the banks to give
disadvantaged clients greater access to basic services and to
treat them fairly and courteously, I feel they have a long way
to go when I hear that some people are still having trouble
cashing their government cheque.
As recently as last month, the media in Quebec were talking
about how difficult it is for welfare recipients to obtain
services in federally chartered banks as well as in the
provincially regulated caisses populaires.
A simple amendment to the Canadian Human Rights Act would
prohibit discrimination against the poor and would give these
people an effective recourse when they are discriminated
against, for example, when they are denied housing or the
possibility to open a bank account.
Let us not kid ourselves. There are still people in this country
today who are victims of discrimination when they do such simple
things as apply for a job, look for an apartment or open a bank
account.
Add to that the feeling of shame from having to stand in line at
the soup kitchen and the feeling of anguish from not knowing if
their children will have a roof over their heads and food on the
table the next day. Members will certainly agree with me that
these people unquestionably need to have their right to respect
and to dignity protected under the law.
I am talking about the protection of a right since Bill S-11,
which supports both the intent and the purpose of the Canadian
Charter of Rights and Freedoms, does not grant any special
privilege to the poor in Canada. Its sole purpose is to ensure
explicit recognition of poverty and its related attributes, such
as being a welfare recipient, and to prohibit discrimination
against the poor in areas under federal jurisdiction.
Need I remind members that the Canadian Human Rights Act does
recognize that some people in our society are considered
vulnerable and must be protected against discrimination. The
prohibited grounds of discrimination include race, national or
ethnic origin, colour, religion, sex, marital status, family
status, disability and, since not too long ago, sexual
orientation.
Bill S-11 simply proposes to add the words “social condition” to
the list of prohibited grounds of discrimination in section 2
and subsection 3(1) of the act. And the reason for that is very
simple: one-fifth of the Canadian population does not live the
same way you and I do.
I know this concept is hard to grasp for those of us who have
never had to face the human misery associated with real poverty.
Let me ask you to follow me for a few seconds on an imaginary
trip that might help you measure the magnitude of the terrible
social and human problem that poverty is.
Imagine yourself coming home to announce to your family that you
just lost your job, a job in which you poured all your talent
and energy, sometimes at the expense of your loved ones, because
there was just not enough time.
Now, you have all the time in the world, but what are you going
to do with it? You just did not think this could ever happen to
you. In the weeks that followed the initial shock you started
looking for work, knocking on every door and meeting every
employer who might need your services.
Unfortunately, the labour market is saturated. While being
apologetic and polite, employers constantly explain to you that
they have to face the new economic realities. They simply do not
need you.
Weeks have gone by. You have used up your savings and your
retirement fund. You must now sell the car, and you will soon
have to do the same with the house, because you can no longer
pay the mortgage.
1825
You managed to save face in front of your friends and your
neighbours during the first few weeks of this nightmare. But now
they are aware of the situation. There is no way you can hide
the sad reality of your human and social decline. You are a poor
and undesirable human being that one may nod to but would rather
cross the street not to have to acknowledge.
For some time now, no one has come to shake hands with you and
ask you how you have been. No one wants to hear bad news. It is
too depressing. You may think you have reached bottom, but you
are wrong. You have seen nothing yet, because now you have to
find ways to survive.
So you go to your bank manager, with whom you have always
enjoyed a friendly relationship, and now it is his turn to tell
you, in a very official tone, that he cannot lend you money. “I
am sorry, but I have to abide by the rules of the institution.
My hands are tied, you have to believe me”, is what he tells
you, secretly hoping this is the last time he has to deal with
you.
What is next? To whom do you turn to? To a food bank? No. To the
state, of course, to this welfare state that cares so much about
the have-nots in our society. You will have to forget about your
pride and your dignity, that is if you have any left. But you
have no choice. You have to feed your hungry children, who are
giving you a reproachful look, blaming you for the social stigma
that will no doubt mark them for the rest of their lives.
Poverty is a debilitating scourge which strikes at random. Let
us stop thinking we can be spared such a plague and let us work
together towards its elimination.
“The day will come when nations will be judged not by their
military or economic strength, nor by the splendour of their
capital cities and public buildings, but by the well-being of
their peoples: by their levels of health, nutrition and
education; by their opportunities to earn a fair reward for
their labours; by their ability to participate in the decisions
that affect their lives; by the respect that is shown for their
civil and political liberties; by the provision that is made for
those who are vulnerable and disadvantaged; and by the
protection that is afforded to the growing minds and bodies of
their children.”
This quote from the United Nations report entitled “The Progress
of Nations” sums up perfectly the spirit in which I am
undertaking this initiative in the House today in order to give
some dignity back to the poorest citizens of this country.
The Prime Minister himself said: “Canada may not be a
super-power, but we are a nation who speaks on the international
scene with great moral authority”. Are we really entitled to
waiving our moral authority in the face of other economic world
powers? I wonder. We are indeed perceived as such, but what are
the facts? I willingly acknowledge that for the fifth year in a
row, the United Nations world report on human development has
rated Canada as having the best quality of life compared to 174
other countries.
However, in spite of this highly desirable ranking with regard
to human development, according to the same report, out of 17
industrialized countries, Canada has the 10th highest level of
poverty.
Indeed, according to the UN human poverty indicator, 11.7% of
Canadians live under the poverty line, a most embarrassing
situation for a country that is so proud of its moral values.
I say that citizens of this country have a right to expect their
government to take without delay the steps required to reinforce
and clarify the current legislation on human rights.
The Canadian Human Rights Act, which is the keystone of our
legislation in this regard, is essentially aimed at protecting
citizens against discrimination and guarantees equal
opportunities in federal jurisdictions such as
telecommunications and banks. It also embodies the international
human rights commitments Canada has made since the Universal
Declaration of Human Rights was signed in 1948.
With the Canadian Charter of Rights and Freedoms and provincial
legislation on human rights, this Canadian law promoted the
fundamental values of equality and human dignity.
Unfortunately, this act is not currently clear or consistent.
Although it is aimed at promoting equity for all Canadians, it
perpetuates the discrimination it seeks to eliminate by
protecting only certain vulnerable groups.
The fact that the Canadian Human Rights Act does not include
social condition among prohibited grounds of discrimination is
an indication of the social and economic alienation of the poor
and of their lack of influence in the Canadian political system.
1830
Until this oversight in the legislation is corrected, the poor
will continue to be the victims of discrimination and prejudice.
The specific purpose of Bill S-11 is to rectify the situation by
building a society where everybody are equal.
That is why this bill is so important to me. The almost ideal
society where everyone is entitled to the same respect and the
same human dignity is now within our grasp. The poor may be the
only marginalized group that has not yet been included in the
Canadian Human Rights Act. It is up to us, as members of this
House, to correct this deplorable flaw in the legislation.
From a practical point of view, this will tell employers and
service providers under federal jurisdiction that they cannot
discriminate against a person because he or she is, for example,
a welfare recipient. I want to emphasize that adding social
condition as a prohibited ground of discrimination would not
force businesses to provide services if they have good reason to
believe that the client is unable to pay or that he or she
clearly represents a financial risk.
Indeed, paragraph 15(g) of the act states clearly that there is
no discrimination when an individual is denied services or is a
victim of any adverse differentiation and there is bona fide
justification for that denial of differentiation.
Having said that, I want to mention that national antipoverty
organizations that are unsatisfied with the lack of legislation
on human rights have started to use the judiciary system to
bring about some change. They essentially claim that
marginalized groups that are not listed in the charter of
rights, but who are the victims of such discrimination, must be
considered on the same footing as the groups that are listed and
be treated as such under the law. They only have to prove to the
court that these groups are the victims of such discrimination.
For example, this was the direction taken by homosexuals rights'
advocates when they got tired of waiting for politicians to act.
Noting their success, other groups in search of equality are
already starting to follow suit.
By amending the Canadian Human Rights Act to include social
condition among prohibited grounds of discrimination, parliament
will then fulfil its responsibility to abide by the Canadian
charter of rights, while saving taxpayers the costs associated
with court challenges in order to bring the Canadian Human
Rights Act in line with the Constitution of Canada and
international commitments made by Canada on human rights.
On both a symbolic and practical level, it would be important,
on the 50th anniversary of the Universal Declaration of Human
rights, for Canada to reaffirm the commitments it made when
ratifying international covenants, including the International
Covenant on Economic, Social and Cultural Rights.
I remind the House that Canada ratified this international
covenant in 1976.
By signing this covenant, the federal government recognized the
right of all Canadians and of their families to enjoy an
adequate standard of living, including food on the table, good
clothing, appropriate housing and living conditions that keep
improving. The agreement also provides for periodical reviews of
Canada's compliance with the covenant.
This committee is currently carrying out its third periodical
review. I am afraid that, once again, as a government, we will
get bad reviews. Need I remind the House that, while the
standard of living has improved for some Canadians in certain
areas, Canada has yet to guarantee access to the bare
necessities for its most vulnerable citizens.
Food banks, which were nowhere to be found in the 1970s, now
number in the thousands and can be found in 450 communities.
The problem of affordable and adequate housing has now become a
full-blown crisis: almost 400,000 Canadians live in substandard
housing.
These are some of the issues that convinced the National
Anti-Poverty Organization and the Charter Committee on Poverty
Issues to travel to Geneva, in May of 1993, to appear during the
examination of Canada's second report on the implementation of
the International Covenant on Economic, Social and Cultural
Rights. The brief submitted to the Committee on Economic, Social
and Cultural Rights, as well as the testimony of these two
national anti-poverty organizations, emphasized the inequities in
what they ironically call “the land of plenty”. Not
surprisingly, committee members were quite stunned by the
information they were provided with, since they thought all
Canadians enjoyed an exemplary standard of living.
They were also shocked to find out about the high levels of
poverty among children and single mothers, the large number of
food banks, and the state of disrepair of a large proportion of
low-cost housing units.
1835
On June 10, 1993, the Committee on Economic, Social and Economic
Rights tabled its conclusions, in which it expressed a number of
concerns about poverty in Canada. The committee was alarmed at
the persistence of poverty in the country, and at the fact that
no significant progress had apparently been made in the previous
decade. It expressed its particular concern that more than half
of all single mothers and a large number of children live in
poverty.
The committee recommended among other measures that the
legislation on human rights include more explicit provisions on
social, economic and cultural rights. By passing Bill S-11, we
would confirm Canada's will to take these criticisms into
consideration.
I also like to think that, by expanding the scope of the
Canadian Human Rights Act, we are doing more than merely
defending an ideal. The protection of these rights could well be
one of our most powerful tools in the fight against poverty,
since it promotes human dignity, justice and equal
opportunities.
Since the Canadian Human Rights Act is a powerful education
tool, establishing standards would help create social
behaviours. A dialogue would then follow, so that institutions
and the public in general might better understand what it means
to live in poverty.
In another vein, I want to say that the fact that most
circumstances leading to discrimination based on social
condition come under provincial jurisdiction does not justify
the absence of this prohibited ground from the federal act.
People in this country have the right to seek remedy and redress
when federally regulated institutions such as banks, airlines
and telecommunications companies practice discrimination based
on social condition.
Bill S-11 does not infringe on the provinces' legislative powers
since the Canadian Human Rights Act only applies to areas under
federal jurisdiction. This being said, it should be noted that
the provinces are ahead of us and have acted in their respective
areas of jurisdiction.
As a matter of fact, in eight provinces, the human rights act
prohibits discrimination based on social condition, social
background, source of income or being on welfare. The steps they
took are aimed at protecting the poor against discriminatory
practices in areas under their jurisdiction such as housing and
public services. The prohibited ground of discrimination applies
to every activity legislated by the provinces except in Ontario
where it only applies to housing.
I am pleased to add that my home province is a leader in this
area since for the past 13 years the Quebec Charter of Human
Rights and Freedoms has prohibited discrimination based on
social condition in every area covered by the charter.
May I conclude by repeating once more that poverty is a serious
threat to the right to equality, and that it has no place in an
affluent country like Canada.
I urge you to consider poverty in the light of human rights. I
suggest that the prejudice the poor have to face in Canada is
similar to that of the marginalized groups listed in the
Canadian Human Rights Act. Yet, poverty is still not recognized
in the law as a direct and dominant cause of inequality and
disadvantage in Canadian society.
I urge all my colleagues in the House to correct this
regrettable legislative weakness. Let us stop saying it is time
to act, and let us do something right now by passing Bill S-11.
[English]
Mr. Lynn Myers (Waterloo—Wellington, Lib.): Mr. Speaker,
I am pleased to rise in the House today to debate this very
important issue. It is a matter of great importance not only to
the residents of Waterloo-Wellington but to all Canadians.
I support the essence and spirit behind Bill S-11, an amendment
to the Canadian Human Rights Act to add social condition as a
protected ground under the act. I believe the drafter of Bill
S-11 intended it to provide protection to the poor and to
prohibit discrimination based on economic discrimination. This
is laudable and should be supported by all members.
My concern is not with the object and aim of Bill S-11 but
rather the overly broad and necessarily confusing nature of the
exact wording. Simply using an open ended term such as social
condition will add confusion to the act and will result in an
endless sea of litigation.
1840
If we are serious about assisting the poor and disadvantaged in
society, we must create opportunities for jobs and provide
education, training and the necessities of life so that they will
be able to participate as full and equal members of society. We
must provide a remedy through our human rights legislation for
prejudicial treatment of the poor in a manner that makes that
protection meaningful.
This year we are celebrating the 50th anniversary of the UN
declaration of human rights. It is a fitting time to review our
current human rights legislation to ensure that it protects the
most vulnerable of society. In Canada we have honoured our
commitment to the declaration for 50 years. I might remind all
members of the House that article 25 of the declaration states:
Everyone has the right to a standard of living adequate for the
health and well-being of himself or herself and his or her
family, including food, clothing, housing and medical care and
necessary social services, and the right to security in the event
of unemployment, sickness, disability, old age or other lack of
livelihood and circumstances beyond his or her control.
Recently the United Nations in its human rights development
index report gave Canada top marks as being the best place in the
world to live based on 1995 data. The hon. member mentioned that
in her opening speech. I believe that Canada received the high
rating because Canadians take our commitment to human rights very
seriously. That is why the government is committed to a broad
review of the human rights act in this area. We want to ensure
that the act is an effective instrument that protects the human
rights of all Canadians.
Let us go a step further and note that although Canada received
high marks the authors of the report cautioned Canadians to note
that there was a growing wealth disparity among Canadians. This
is unacceptable. Acknowledging this, the federal government is
very committed to protecting all Canadians. We are particularly
concerned with designing programs that provide specific relief to
the most needy.
The Government of Canada and provincial and territorial
governments have agreed that children are a top public priority
and have jointly participated in the design of the national child
benefit system. This initiative is an important one which aims
to prevent and reduce the depth of child poverty and to promote
attachment to the workforce.
In addition, the 1997 federal budget announced a $850 million
per year increase to the Canada child tax benefit for low income
families. The 1997 Speech from the Throne committed at least an
additional $850 million within this mandate for the national
child benefit, and this was confirmed by the recent 1998 budget.
The addition of the ground of social condition as stated in Bill
S-11 is to extend the protection currently provided by the act to
include economic rights. However we need to ask what we mean by
economic rights. We must be very clear on the meaning of this
additional ground if we want the Canadian Human Rights
Commission, the tribunal and the courts to understand the exact
type of problems we hope to address by adding the words social
condition to the Canadian Human Rights Act.
Let us sit back for a minute and examine the purpose of the
Canadian Human Rights Act, what it can achieve and what impact
adding this new ground will have on the act as a whole. The
Canadian Human Rights Act is an anti-discrimination statute. It
does not provide for rights directly but rather it provides for
redress of an individual or a group of individuals who believe
that they have been the victim of discrimination.
The act covers discriminatory acts in the context of employment
and the provision of services and facilities customarily
available to the public. Notably the act only applies to the
federal sector. This includes the federal government and
federally regulated employers and service providers such as
banks, airlines, railways, telecommunication and interprovincial
trucking companies. The vast majority of small businesses,
schools and religious institutions are governed by provincial
human rights legislation.
Groups that appeared before the senate committee on the bill
such as the National Anti-Poverty Organization provided firsthand
experience about the poor in Canada. They spoke of the plight of
the homeless, the problems of people below certain income levels
finding housing, for example, and the difficulties they encounter
in accessing services from banking to telephones. These are some
of the problems ostensibly that this amendment was designed to
resolve.
However this motivation may be somewhat misplaced. First,
housing is primarily a provincial matter. Many provincial human
rights codes currently provide as an enumerated ground of
discrimination sources of income or receipt of social assistance.
1845
This ground provides a remedy for discrimination for individuals
living on social assistance. For example, when a landlord
refuses to rent to a family because it is on social assistance,
this type of discriminatory act is captured by the provincial
human rights codes that contain the ground of social assistance.
It is important to note that the only province in Canada that
has the ground of social condition in its human rights
legislation is Quebec. Quebec formally added this ground in
1996. There have not been a large number of tribunal decisions
on this ground but we know at this point that this term includes
both the objective element of being poor with the social aspects
of prejudicial treatment against people who are poor. It is too
early to determine the impact of adding this ground in Quebec and
of course the impact on the federal jurisdiction as I stated
earlier is not clear.
There are problems in the federal jurisdiction that do not need
to be talked about here but clearly need to be addressed. The
National Anti-Poverty Organization for example, citing Quebec
statistics found that 80% to 90% of the poor were refused
services from the banks, services such as cheque cashing or
opening an account. I understand that the banks have taken some
measures to correct these actions. We must be sure that no one
is denied a service because the source of their income is
provided by the state.
I am concerned that the banks and telecommunications companies
may not be doing enough to ensure that their policies do not
discriminate against the poor. It is this type of situation that
needs to be looked at in the broad review of the Canadian Human
Rights Act.
We will look at determining the scope of the problem of the poor
in this country in the context of what relief the Canadian Human
Rights Act could possibly offer. We will then work to find a
solution that is tailor made to address the specific problems
that we uncover.
Left as it is, Bill S-11 simply incorporates a term that might
make us feel good but it does not effectively address the
problems in the federal context nor provide a truly effective
remedy for the poor.
By comparison, look at the prohibited grounds currently listed
in the act, for example, race, national or ethnic origin, colour,
religion, age, sex, sexual orientation, marital status, family
status, disability, and conviction for which a pardon has been
granted. For the most part these grounds are immutable
characteristics.
We know what the ground marital status means for example. It
includes single, common law, same sex partners and married
couples. This ground has resulted in changes to federal programs
to ensure that they do not discriminate on the basis of someone's
marital status.
I am strongly in favour of addressing the real needs of the
poor. No one can support discrimination against anyone simply
because his or her income is below a certain level. But I am
concerned that we have not in any meaningful way fully canvassed
the legal implications of the term social union in the federal
context. There would be real concerns in terms of where we are
heading.
Does it mean we must not discriminate because of someone's level
of income? We apply different income tax rates based on
different income levels. Does it mean then that the Income Tax
Act could be suspect as potentially contrary to the human rights
act if we adopt such a term? We would have to be very careful.
We would also have to note carefully the employment insurance
program which requires specific criteria to be met before someone
is eligible to obtain benefits. Would this program also be
suspect?
Could RRSP provisions be subject to scrutiny under the Canadian
Human Rights Act given that individuals of certain income types
and levels, or very low levels of income cannot take advantage of
this provision? I certainly hope not. That would be most
unfortunate.
If we are going to provide additional protection for the poor,
and I believe we should and I think all members of this House
believe we should, we want it to be meaningful. Let us take the
time then through the broad review of the Canadian Human Rights
Act to research this problem and to find a solution that will
provide meaningful protection for the poor. I believe that is
what all Canadians want.
Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): Mr.
Speaker, I too am pleased to enter the debate on this private
member's bill. I sense the deep caring of members of this House
for those who are less fortunate or disadvantaged particularly
because of their social condition.
1850
The proposal is that the Canadian Human Rights Act would add
social condition as a prohibited ground of discrimination. I
think the concern for others that is behind this bill is
something we all share and applaud. The question is whether this
proposed remedy is appropriate, whether it will do the job and
whether it will have the consequences we hope it will have.
The first question I have for the sponsor of this bill is what
is the definition of social condition? There was no definition
offered by the member in her speech. It is very important that we
define our terms.
We saw the problem the Liberals got themselves into by
committing themselves to something called pay equity. It was
undefined and it was left up to courts and tribunals to sort out
what the legislators meant. They came up with the result which
the proposers of the measure did not like. Now the Liberals are
in the very embarrassing position of having to fight the
interpretation of their own legislation. That is not a good
position to be in.
If we are going to add something into such a critical and strong
piece of legislation as the Canadian Human Rights Act, we had
better know what we are talking about.
The eight provinces that have similar provisions in their human
rights legislation use somewhat different terms. Newfoundland
uses the term social origin. Nova Scotia, P.E.I., Manitoba and
Alberta prohibit discrimination on the grounds of source of
income. Saskatchewan and Ontario prohibit discrimination on the
basis of being in receipt of public assistance.
The member in her speech mentioned source of income or being in
receipt of public assistance as a concern encompassed by the
bill. We need to be clear about what we are talking about.
I noticed that the senator who introduced this bill in the
Senate said “poverty is a serious breach of equality rights,
which I believe has no place in a country as prosperous as
ours”. It is suggested by the senator that social condition
refers to poverty. If it does, I think we should be clear about
that so that we do not get unwarranted or unexpected
interpretations in our desire to protect some Canadians.
The senator also referred to the absence of any direct
recognition of poverty as a pervasive source of inequality and
disadvantage in Canadian society. If we are talking about
poverty, perhaps that is what we should say.
Quebec is the only jurisdiction in which the term social
condition is used. It is listed as a prohibited ground of
discrimination and it is not defined in the Quebec statute. How
has it worked out in Quebec? What has happened is that virtually
all applications in which social condition is stated as a ground
of discrimination were dismissed by the Quebec courts. I would
suggest it is not a very strong protection for people when the
courts do not find the term to be sufficiently specific to
actually use it to protect people.
There is only one case concerning the refusal to rent a housing
unit that was found to be discriminatory on the basis of social
condition. That is not an experience the Parliament of Canada
would find very helpful in protecting the people we want to
protect under the bill.
The human rights tribunal in Quebec has taken a broader
interpretation of the term social condition, as human rights
tribunals have done for example in the case of pay equity.
Damages were awarded in seven of eight decisions that we have
been able to identify. In those seven judgments, the social
condition was defined fairly narrowly as being a social
assistance recipient.
1855
It is important that legislators legislate from their hearts.
But they also must legislate in a way that is objectively and
legally effective to protect people in society.
The other question I have concerns the whole area of the law of
unintended consequences. If we are going to protect people on the
basis of social condition, nobody knows exactly what it is.
Senator Cohen made a very revealing comment at the end of her
intervention on this subject. She said “In passing this bill,
hon. senators, we provide protection for our most vulnerable
citizens”. We all want to do that. “While you or I may not
fully understand the significance of this law, it is clear to me
that those who live in poverty consider this to be an extremely
important statement about their worth and their value as citizens
of this country”.
There probably is not a member in this House who does not think
it is extremely to important to affirm the significance and value
of each human being, each citizen of this country. We need to do
this, but to put an undefined and possibly wrongfully interpreted
term in our legislation in order to make this kind of affirmative
statement is very dangerous. At the very least, it is a very
poor and illogical way of bringing forward a social consequence
that we would all support.
We have to look at how this term could possibly be
misinterpreted. For example, as the member who spoke before me
pointed out, social condition could be used to bring a case that
higher income people should not be given higher progressive taxes
because it would be discriminatory. By taxing the higher income
people more because of their higher incomes, their social
condition could be seen as being treated in a discriminatory way.
We want to be careful that those kinds of interpretations cannot
be made because our terms are carefully defined.
While the intent of the bill is something we all support, I
would argue very strongly that this House carefully consider
whether it is appropriate and whether we are going to get the
results we want by passing the bill in its present form.
Social condition is largely subjective whereas other prohibited
grounds, such as race, ethnic origin, colour, religion, sex, age,
all of those things are objective. We have to be very careful
when we put subjective criteria in place. We may know what we
want and we may think we know what we are getting but we can get
something completely different. It would be very irresponsible
of us as legislators to do that.
When we talk about this legislation, I would support having a
very careful look at how we can remedy the wrongs and the ills
that the member so eloquently points out. In my view the bill
would not do that. It could very well have undesirable
consequences because it has not been carefully drafted at this
point and we could be quite aghast at the consequences in years
to come.
For that reason, although I fully support the intent behind this
bill, the compassion and caring that motivates it, I think it
would be a poor piece of legislation for the House to pass. I
would ask members to go back to the drawing board and come
forward with something more specific and effective to do the job
than this bill would do.
1900
[Translation]
Mrs. Madeleine Dalphond-Guiral (Laval Centre, BQ): Mr. Speaker,
it is with pleasure that I rise today to speak on private
member's Bill S-11, an act to amend the Canadian Human Rights Act
in order to add social condition as a prohibited ground of
discrimination.
This is a short bill. It contains only two clauses. But it
nevertheless addressed a shortcoming in the existing Canadian
human rights legislation, a major shortcoming, by prohibiting
discrimination on the basis of social condition.
The first clause of the bill states that:
1. Section 2 of the Canadian Human rights Act is replaced by the
following:
2. The purpose of this act is to extend the laws in Canada to
give effect, within the purview of matters coming within the
legislative authority of Parliament, to the principle that every
individual should have an equal opportunity with other
individuals to make for himself or herself the life that he or
she is able and wishes to have, consistent with his or her
duties and obligations as a member of society, without being
hindered in or prevented from doing so by discriminatory
practices based on race, national or ethnic origin, colour,
religion, age, sex, sexual orientation, marital status, family
status, social condition, disability or conviction for an
offence for which a pardon has been granted.
Clause 2 reads as follows:
2. Subsection 3(1) of the act is replaced by the following:
3.(1) For all purposes of this act, race, national or ethnic
origin, colour, religion, age, sex, sexual orientation, marital
status, family status, social condition, disability and
conviction for which a pardon has been granted are prohibited
grounds of discrimination.
It might be interesting to take a brief look at the meaning of
“social condition” and its importance in the various provinces.
In Quebec for instance, this ground of discrimination is part
and parcel of the Charter of Human Rights and Freedoms, whose
section 10 reads as follows:
(Discrimination forbidden)
10. Every person has the right to full and equal recognition and
exercise of his human rights and freedoms without distinction,
exclusion or preference based on race, colour, sex, pregnancy,
sexual orientation, civil status, age except as provided by law,
religion, political convictions, language, ethnic or national
origin, social condition, a handicap or the use of any means to
palliate a handicap.
Moreover, the Ontario Charter of Human Rights stipulates that
receiving social assistance is a banned ground for
discrimination only in connection with housing. In Manitoba, in
Alberta and in Nova Scotia, source of income is a forbidden
ground for discrimination. In Saskatchewan, it is receiving
social assistance, while Newfoundland refers to social
background.
In fact, all of these provisions are aimed at banning
discrimination based on poverty.
In practice, however, this is unfortunately limited to being a
welfare recipient.
Only the Quebec law includes a broader interpretation by having
integrated the term “social condition” without restricting it to
receiving social assistance. Quebec jurisprudence has, in fact,
defined social condition as encompassing income, occupation,
level of education, and social background. It is therefore a
very broad interpretation, one aimed at clearly emphasizing that
it is forbidden to discriminate against the poor, who are
becoming more and more numerous as we know.
One example of discrimination based on social condition is a
landlord's refusal to rent to a person solely because that
person is on welfare. Here, the reason for refusal is not based
on the ability or inability to pay the rent, but solely on the
fact that the person is receiving social assistance.
Another example, under federal jurisdiction this time, would be
a bank's refusal to open an account for a person on welfare. It
is a matter of public knowledge that certain banks do not
hesitate to charge for opening an account, this being
particularly aimed at social assistance recipients.
1905
I think this bill sends the message that at the dawn of the
third millennium discrimination against poor people is
unacceptable. Quebec long ago adopted this value. It is high
time the poor were protected against discrimination in areas of
federal jurisdiction.
At a time of globalization and free trade, it is more important
than ever that individuals' basic rights be respected,
especially the right to equal opportunity.
In this context, it is totally unacceptable for business people,
such as the president of Bombardier International, to be anxious
about the Prime Minister's discussion of human rights in
Malaysia.
It is true that it may be easier for the little guy from
Saint-Maurice to talk about human rights in Malaysia than to
respect them in Vancouver.
Nevertheless, it is regrettable when fundamental human rights
are sacrificed at the altar of international trade.
We cannot fail but protest the fact that current Liberal
government policies are broadening the rift between rich and
poor. More and more children are growing up in poverty in
Canada, more and more families are poor.
Entrenching Bill S-11 in the charter should amount to more than
wishful thinking. The best way to fight discrimination against
social condition is to improve the living conditions of our
fellow citizens who find themselves in difficult economic
straits incompatible with human dignity.
This government must take specific action to ensure justice for
our society's most disadvantaged. Changing the employment
insurance plan, returning to the provinces the money savagely cut
from transfers, reducing income tax for the middle class—these
are all ways to show that the improvement of social conditions is
a priority of this government.
Unfortunately, I fear that such wishes, while easily realized,
will not become a reality. However, I would hope that Bill S-11
will be passed unanimously by this House. It at least will
become a reality.
[English]
Ms. Libby Davies (Vancouver East, NDP): Mr. Speaker, I am
very pleased to rise in the House to support Bill S-11, an act to
amend the Canadian Human Rights Act, in order to add social
condition as a prohibitive ground of discrimination.
I express my thanks to Senator Cohen who worked very long and
hard to raise this issue not only in the Senate but in Canadian
society. Senator Cohen has done a lot of very good work
including producing an excellent report on poverty in Canada. I
also thank the member for Shefford who has brought this bill from
the Senate into the House for debate.
In March the chief commissioner of the Canadian Human Rights
Commission said: “Poverty is a serious breach of equality rights
which I believe has no place in a country as prosperous as ours.
Human rights are indivisible. Economic and social rights cannot
be separated from political, legal or equality rights. It is now
time to recognize poverty as a human rights issue here at home as
well”. She said this in her annual report to parliament in
1998.
The commissioner is saying what we know from our own experience
and what I know from my own riding of Vancouver East, that
poverty is one of the greatest barriers to equality in Canada.
There is no question when we look at what is happening around us
that poor people are losing their rights. Discrimination is
growing. We are witnessing a growing homelessness that is now at
crisis proportions in Canada. There is an increasing environment
of poor bashing. We are seeing municipal bylaws that are
discriminatory against poor people such as anti-pan handling
bylaws.
1910
There is a growing environment in this country where there is
increasing discrimination against poor people.
All of that is contrary to the universal declaration of human
rights. It has been very interesting to hear members from the
Liberal Party and the Reform Party talk about how this bill and
the idea of a prohibited ground based on social conditions is too
difficult for us to deal with.
We can always find reasons not to do something. But the fact is
we all know in our hearts that poor people do face vicious
discrimination. We need the political will to say it should be a
prohibited ground as we do in provincial legislation so it is not
an issue that there will be too much litigation or it is too
difficult, too complex. It already exists as a legal entity, as a
legal ground. We are now saying this should be included in
Canadian human rights.
What I want to focus on is real point here, that the greatest
source of discrimination against poor people in Canada comes from
government policy. Yes, there is discrimination by landlords,
banks, businesses, services and even in our general attitudes and
stereotypes about poor people. But there is no question that the
greatest discrimination is from public policy.
Yesterday and today in Geneva representatives from NAPO and
anti-poverty groups are briefing UN officials on Canada's
hypocrisy when it comes to dealing with poverty. This deals with
the UN covenant on economic, social and cultural rights which
Canada was a signatory to in 1976.
The anti-poverty groups are meeting with a UN committee to
expose what has been Canada's blatant disregard for the covenant
as we now are seeing in this growing environment of
discrimination against poor people.
I think it is interesting to note that this is not the first
time that anti-poverty groups have had to appear as witnesses to
the UN committee to point out what is happening in Canada.
In 1993 NAPO and the charter committee on poverty issues went to
the UN committee and exposed the extent of Canada's shocking
non-compliance with the UN covenant. This is where we really get
to the heart of discrimination and what is happening with growing
poverty in Canada.
I would like to talk about some of the things that have taken
place. We could go back to 1989, to a good day in the House of
Commons when the House unanimously passed a resolution to
eliminate child poverty by the year 2000, something all members
stood up and voted for and it was a very noble gesture. What
happened?
In 1993 the federal government abandoned social housing, one of
the key issues that determined health and poverty in this
country. In 1995 we saw the loss of the Canada assistance plan
that had laid out basic rights and conditions in terms of social
entitlement.
In 1996 we saw the era of the Canada health and social transfer
that abandoned and eliminated those universal rights in Canada
and for the first time saw a massive downloading and slashing of
social programs that were now up to $6 billion or $7 billion that
has affected the most vulnerable people in society.
This brings us to 1998. This discrimination is still going on
and I believe it is the worst form of discrimination,
discrimination by government and public policy. The child tax
benefit discriminates against the poorest families in Canada by
denying people and families on welfare the right to the child tax
benefit. That is discrimination, something that should be
outlawed if we had social conditions in the human rights act.
We only have to look at the EI cutbacks to see another form of
discrimination. I think it really begs the question why the
government is reluctant to support this amendment.
I went back into the records to see what kinds of positions have
been taken by Liberal members in previous years and I came across
a very interesting quote in Hansard of May 1993. This is
what a Liberal member had to say with regard to the UN covenant
on social, economic and cultural rights: “The UN, hardly an
enemy of Canada, says that the government record on child
poverty, on homelessness and on food banks is deplorable. We live
in one of the wealthiest countries in the world yet we are
condemned internationally because the Conservative government has
disregarded the reality of poverty”.
1915
That was a statement by the Liberal member for Hamilton East in
May 1993. The same members who are now part of the government
have systematically created policies and programs that have
discriminated against poor people and have increased poverty in
Canada.
There is no question that our goal and why we should support the
bill as a very important step is that we should be working
together to end discrimination on the basis of social condition.
It is very important to say that is not enough. Our goal must
also be to force the federal government to set concrete targets
to eliminate poverty and homelessness.
As pointed out by my colleague in the Bloc, if we eliminate the
conditions of poverty, elevate people out of poverty, provide
jobs, housing and social support, we are meeting the goals and
targets we should have.
The greatest challenge for us is to get governments, not just
the Liberal government but all governments, to examine their
record and acknowledge their policies which have quite
deliberately and consciously created increased poverty in Canada.
This is not an issue of individual poor people who are to blame,
although they often are. We only have to look at workfare
programs as yet another form of discrimination. It is the years
of slashing social programs and of scapegoating poor people that
has brought us to where we are today.
We have an opportunity in the House today to do the right thing
and to say that social condition is something that can work. We
can join together like we did in 1989 with the resolution to
eliminate child poverty. We can say that social condition should
be a prohibited ground of discrimination and should be in the
Canadian Human Rights Act. We can do the right thing. I ask my
colleagues to think seriously about the issue, join us and vote
for the bill.
[Translation]
The Acting Speaker (Mr. McClelland): The time provided for the
consideration of Private Members' Business has now expired and
the order is dropped to the bottom of the order of precedence on
the order paper.
ADJOURNMENT PROCEEDINGS
[English]
A motion to adjourn the House under Standing Order 38 deemed to
have been moved.
AGRICULTURE
Mr. John Solomon (Regina—Lumsden—Lake Centre, NDP): Mr.
Speaker, farm families in Canada are in crisis. Since my
question to the Minister of Agriculture and Agri-Food last month
on the farm crisis on the prairies net farm income has dropped
not to 40% of last year's income but to 70% of last year's
income. This is a crisis by any description. That is one
particular description of a crisis.
We also have the lowest net farm income in western Canada since
the great depression of 1929 and the 1930s. At $3,400 per farm
this year that is the lowest per farm net income recorded since
Statistics Canada began keeping records in 1926. The agriculture
and food industry in Saskatchewan is related to over 40% of all
jobs in the province. We have a very significant crisis as well
as a social crisis.
Whenever farmers' incomes fell in the previous decade the media
and the Liberals implied that farmers were to blame because they
insisted on growing wheat for a world that already had enough.
The implicit message was to diversify or perish. What have the
farmers done? The irony is that today in Saskatchewan farmers
are growing peas, lentils, sunflowers, spices and raising llamas,
wild boars and even fainting goats. We now face the lowest farm
income levels in history.
As well agricultural exports from 1989 to 1997 doubled in
Canada. Yet net farm income declined over that period. Machinery
operation costs increased 21% over the past five years.
Fertilizer costs increased 57%. Farm chemical costs increased
63%. Liberal government user fees increased by $138 million as a
result of the privatizations of the agricultural industry.
We have seen U.S. subsidies for wheat at $2.68 U.S. per bushel
when the price of wheat right now is $2.46 U.S. per bushel.
In addition to that subsidy we have also seen an increase of $6
billion by the U.S. treasury for its farmers, which now totals
about $22 billion Canadian. That is what U.S. farmers are
getting from their government. Canada is getting zippo as far as
subsidies are concerned. Europeans are providing $5.35 U.S. a
bushel subsidy for their wheat producers.
1920
The Liberal government betrayed and abandoned farmers by doing
away with the Crow rate. Other countries in Europe and the
States backed their farmers with their treasuries. I call on the
government to commit to a national agricultural policy which will
stand up and protect farmers in this very serious condition. I
call upon the Government of Canada to establish an emergency farm
aid program around the national agricultural policy which I would
like to see it announce in the House of Commons tonight.
Mr. Joe McGuire (Parliamentary Secretary to Minister of
Agriculture and Agri-Food, Lib.): Mr. Speaker, I commend the
hon. member for raising the question about the crisis in farm
income.
The minister of agriculture is very concerned about the farm
income situation. When the official opposition requested a
debate in the House of Commons on farm income, it was the
minister who led the debate.
Further to the debate in the House of Commons the minister
convened a meeting on November 4 with industry leaders,
provincial ministers and farm leaders. At that time officials
were instructed to accelerate the process to consider both short
term and long term solutions to the expected farm income declines
in 1998 and 1999. Federal and provincial deputy ministers of
agriculture met on November 5 and 6 and are actively developing a
full range of options that could be considered.
As well, the industry advisory group on safety nets met on
November 10 and will be sharing with the minister and officials
its view on alternative actions that could be undertaken by
governments including the possible approaches in designing a
national disaster program.
We have worked co-operatively with our provincial colleagues and
industry players on developing the current safety net system. We
will continue to work co-operatively on making the system even
better. This is a key priority for the minister of agriculture.
He is diligent in his efforts to ensure that farmers across
Canada have the necessary tools to manage price and income
fluctuations that are beyond their control.
The minister is committed to acting as quickly as possible but
not rashly, irresponsibly or prematurely. The necessary tools
are being developed to improve the effectiveness of the farm
safety net system as quickly as possible, but I am sure the hon.
member will agree that inequitable, ineffective and unaffordable
ad hoc measures are not the answer.
Action must be taken quickly, however. It is important to take
the time necessary to ensure the actions taken are the best ones
for farmers and for all Canadians.
AIRCRAFT SAFETY
Mr. Bill Casey (Cumberland—Colchester, PC): Mr. Speaker,
I rise to ask questions about the aircraft safety issue following
the horrible crash of Swissair flight 111 off Peggy's Cove some
time ago. Coincidentally just last night another aircraft had a
forced landing in Gander, Newfoundland. The problem was similar
to the one reported in the Swissair crash. This one did not
crash but it was a forced landing because of loss of cabin
pressure and smoke in the cockpit.
When I asked this question before the minister responded that we
have no evidence that there is a wiring deficiency or a wiring
problem in aircraft in Canada. I take exception to that and I
will get into it in a second.
Another thing he said was that there certainly was no hazard or
no danger as long as planes are properly maintained. I would
like to address both those issues and ask the parliamentary
secretary to respond.
Certainly on the question of wiring, it is very clear in the
report called “FAA Aging Transport Non-Structural Systems
Plans” that the organization or the task force identified to
research the situation acknowledged that a more extensive
examination of aging aircraft systems was needed.
More aging airplane models need to be evaluated and the wire
analysed in laboratories to fully characterize the condition of
the wire on our aging transport airplane fleet. Certainly wiring
was the big issue in that report.
1925
The FAA went on to identify the top four aging concerns. It is
probably the most highly recognized aircraft safety organization
in the world. The top four aging concerns were wiring,
connectors to wiring, grounds and ground straps, and circuit
breakers. These concerns are all related to wiring. That is
exactly what we have been saying all along. Wiring is an issue
that should be addressed.
The second issue that I want to bring forward is maintenance.
The minister said that even though these planes perhaps have
problems as long as they are properly maintained everything is
okay. However the FAA went on to say that its studies also
revealed that current maintenance practices for systems were too
general and that standard repair practices were needed. It said
that there was definitely a need to improve inspections. The
review found that some wiring systems were difficult to inspect
and that there were insufficient inspection criteria for
corrosion on flight control and hydraulic systems.
Again I bring to the attention of the parliamentary secretary
that wiring is an issue and inspections do not cover it. That is
very clear from the FAA report.
I would like the parliamentary secretary to address those
remarks of the FAA. I would like him to acknowledge the problem
like the FAA has done. There is a problem with wiring. There is
a problem with aging aircraft. There is a problem with
inspections.
I would also like the parliamentary secretary to comment on the
specific wiring deficiencies and any efforts made or attempts
right now to try to determine what the problems are. I would
like him to comment on the FAA remarks that improved inspections
and maintenance procedures were definitely required right away.
If the parliamentary secretary could address those three issues
by the FAA I would be very grateful.
Mr. Stan Dromisky (Parliamentary Secretary to Minister of
Transport, Lib.): Mr. Speaker, I am pleased to have the
opportunity to respond to the matter raised by the hon. member
for Cumberland—Colchester on October 20, 1998 as well as this
evening regarding aircraft safety and kapton wiring.
During the certification of both foreign and domestic aircraft
used in Canada, Transport Canada assesses aircraft wiring systems
including the use of kapton wiring for appropriate installation.
The U.S. Federal Aviation Administration addresses the
limitations associated with the use of kapton wiring. It does
not prohibit its use but it does caution on proper installation.
When installed in accordance with FAA guidelines and subjected
to the appropriate maintenance inspection procedures, there are
no identified problems associated with the use of kapton wire.
While Transport Canada is aware of Department of National Defence
initiatives concerning this wire, there is no evidence of an
identified safety problem with the use of kapton in the civil
environment.
Despite the position taken by the U.S. navy that kapton was
totally unacceptable for its aircraft, there was no clear
experience to indicate a widespread problem on civil aircraft. It
is not Transport Canada's practice to require changes on in
service aircraft unless experience has shown it to be necessary
to take such action. If it is shown through inspections, service
difficulty reporting or occurrence investigation results that
there is a problem with kapton, Transport Canada as regulator
will take prompt and appropriate action to mitigate the safety
risk.
In closing, Transport Canada continues to monitor closely the
overall transportation safety board investigation into the
Swissair accident and to evaluate information as it becomes
available.
[Translation]
SCRAPIE
Ms. Hélène Alarie (Louis-Hébert, BQ): Mr. Speaker, since January
1, 1997, the federal program implemented by the Canadian Food
Inspection Agency has resulted in the elimination of some 11,500
lambs and sheep in 236 herds.
This massive slaughter of nearly 10% of the animals has
seriously affected the sheep industry in Quebec. Most animals
have been slaughtered as a preventive measure, and some
producers have lost their whole herd.
Last June, the Bloc Quebecois requested a moratorium on the
slaughtering of sheep, and this moratorium has been respected,
because it was imperative to take stock and put an end to the
carnage.
1930
Today, we are asking the government and the minister of
agriculture to act responsibly and fairly toward sheep producers
and to prevent there being two categories of victims—those
predating the October 27, 1998 order increasing maximum
compensation and those of January 1, 1997.
Fair treatment. Since the industry and the department have
agreed on maximum compensation after October 27 of some $600 a
head, it would be fair if all producers received the same
settlement. If the agency cannot legally act retroactively, the
minister can set up ad hoc programs or income security measures
similar to disaster relief.
The Government of Quebec is doing its very large part to support
sheep producers. Today, in fact, it accorded a maximum loan of
$100,000 per business interest free for three years to all
Quebec producers whose animals were slaughtered between January
1, 1997 and October 27, 1998.
So now what are those primarily responsible for the slaughter of
these many sheep—the agency and the department of
agriculture—waiting for to do likewise? We simply want them to
be fair and equitable.
[English]
Mr. Joe McGuire (Parliamentary Secretary to Minister of
Agriculture and Agri-Food, Lib.): Mr. Speaker, the hon.
member's question on September 30 was: “Can the minister assure
us that Quebec sheep farmers are receiving the same treatment
from the agency in all aspects as their counterparts in other
provinces, and is he prepared to produce agency documents to
prove this?”
I am happy to report that the information requested was provided
to the hon. member for Louis-Hébert in writing.
As the hon. member has stated, we have ordered a number of sheep
quarantined and slaughtered, primarily in Quebec. These actions
have been taken to control and prevent the spread of scrapie and
to protect Canadian consumers and the sheep industry. Our
actions have been based on Health Canada's recommendation that
animals that have been infected or exposed to scrapie must be
kept out of the food chain.
As a result of the difficult but necessary actions to date,
there has been significant progress made in containing the
further spread of scrapie in the sheep population in Quebec.
We sympathize with the situation of these farmers who have
worked hard to develop their industry. We have taken a number of
steps to assist them.
Since the beginning of 1997 the Government of Canada has paid
out more than $2 billion in compensation to sheep farmers in
Quebec. In February we amended our legislation to include
compensation for disposal costs. Recently we doubled the maximum
level for compensation available for sheep destroyed to $600.
In addition, the Farm Credit Corporation developed a deferred
loan program to assist affected farmers in re-establishing their
flocks. We have also committed close to $400,000 to research
into validating a test for scrapie in live animals. In taking
all these steps we have made every effort to consult with and to
work with representatives of the sheep industry.
I can assure the House this government has treated Quebec sheep
farmers fairly and equitably.
The Acting Speaker (Mr. McClelland): The motion to
adjourn the House is now deemed to have been adopted.
Accordingly, this House stands adjourned until tomorrow at 2 p.m.,
pursuant to Standing Order 24(1).
(The House adjourned at 7.33 p.m.)