TABLE OF CONTENTS
Monday, May 30, 1994
Consideration resumed of motion 4549
(Motion agreed to on division.) 4557
Bill C-17. Consideration resumed of report stage 4557
Mr. Mills (Broadview-Greenwood) 4558
Mrs. Gagnon (Québec) 4563
Mr. Leroux (Shefford) 4566
Mr. Speaker (Lethbridge) 4568
Division on motion deferred 4569
Division on motion deferred 4570
Bill S-2. Consideration at report stage 4570
Motion for concurrence 4570
Motion for third reading 4570
Mr. Scott (Fredericton-York-Sunbury) 4574
Mrs. Dalphond-Guiral 4575
Mr. White (Fraser Valley West) 4575
Mr. Leroux (Shefford) 4576
Mr. Gauthier (Roberval) 4578
Mr. Gauthier (Roberval) 4578
Mr. Axworthy (Winnipeg South Centre) 4582
Mr. Axworthy (Winnipeg South Centre) 4582
Mrs. Gagnon (Québec) 4582
Mrs. Gagnon (Québec) 4583
Mr. Axworthy (Winnipeg South Centre) 4583
Mr. Axworthy (Winnipeg South Centre) 4583
Mr. Gauthier (Roberval) 4585
Mr. Gauthier (Roberval) 4585
Bill S-2. Consideration resumed of motion for third reading 4587
Mr. Speaker (Lethbridge) 4590
(Motion agreed to, bill read the third time and passed.) 4591
Bill C-31. Consideration resumed of motion for secondreading 4591
(Motion agreed to, bill read the second time and referredto a committee.) 4602
Bill C-32. Motion for second reading 4602
Mr. Speaker (Lethbridge) 4610
Mr. Breitkreuz (Yorkton-Melville) 4612
(Motion agreed to, bill read the second time and referredto a committee.) 4613
Bill C-17. Consideration resumed of report stage 4613
Motion No. 1 negatived on division: Yeas, 36; Nays, 156 4614
Motion No. 4 negatived on division: Yeas, 62; Nays, 130. 4614
Motion No. 19 negatived on division: Yeas, 26; Nays, 166. 4616
Motion No. 23 negatived on division: Yeas, 0; Nays, 192 4617
Motion for concurrence 4617
Mr. Martin (LaSalle-Émard) 4617
Motion No. 4 agreed to on division: Yeas, 130; Nays, 62. 4617
4549
HOUSE OF COMMONS
Monday, May 30, 1994
The House met at 11 a.m.
_______________
Prayers
_______________
PRIVATE MEMBERS' BUSINESS
[
English]
The House resumed consideration of the motion.
Mr. David Walker (Parliamentary Secretary to Minister of
Finance): Mr. Speaker, it is with a great deal of enthusiasm that
I join in this debate on the private member's motion first
presented to the House by the member for Nepean.
The need for change to the child support system is recognized
by Canadians and the government. As many in the House have
noted the question of child support touches deeply and in many
respects is a very personal issue. It relates to family
responsibilities and to the well-being of our children.
(1105)
Accordingly the government is committed to broad
consultations with those Canadians most affected. That is why
as task group of MPs has been formed to conduct a series of open
round table discussions on child support.
[Translation]
As many of you will have noticed, the subject of child support
payments raises, when it comes to parental responsibilities and
the well-being of our children, questions which are deeply felt
and which in many respects are very personal.
This is why the government is committed to broad
consultations with those Canadians most affected. It has,
therefore, set up a task force of members to hold a series of open
round table discussions on the subject of child support
payments.
[English]
As a member of that task group I welcome the deliberations of
the House. They constitute a thoughtful and highly valued
source of advice. At the same time I am confident that whatever
the results of our current debate, the House shares my eagerness
to hear what Canadians will say to the task group.
Over the coming weeks we will be asking Canadians to share
their experiences and make suggestions with respect to the tax
treatment of child support. The task group will provide feedback
and advice on this issue to our government colleagues.
We have worked out a schedule to reach a cross-section of
Canadians, including representatives of custodial and
non-custodial parents, child advocates, women's organizations,
lawyers, accountants, community groups and others concerned
about this issue.
We have set out a schedule of meetings in Regina, Montreal,
Vancouver, Winnipeg, Moncton, Toronto and Ottawa and are
providing ways for those not in those cities also to participate
and make their views known to the task group, to the
government, and to the House.
The task group will listen to Canadians with an open mind,
guided by a number of clear principles. Our over-arching
principle is that the child's needs come first. Tax rules for child
support must place paramount importance on the welfare of
children.
Second, we are committed to the principle of fairness. That
includes fairness between custodial and non-custodial parents
as well as fairness to other taxpayers. We must treat all family
situations equitably whether there has been a marriage breakup
or not.
Third, while tax equity demands that tax be paid on income,
this exercise is not at all about increasing government revenues.
The issue surrounding child support payments encompasses
more than just their tax treatment. Questions relating to levels of
support and enforcement are critical as well. It is a sad fact that a
great majority of single mothers in Canada receive no support
payments at all for their children and that the great majority of
support orders are not obeyed.
Our goals therefore are broader than those of the current
motion. We want to create a more equitable system for child
support determinations. That includes generally increasing the
value of child support awards, simplifying the process,
providing similar awards in similar family situations.
I can understand that Canadian women affected by the
Thibaudeau decision may be sceptical of the government's
intent. I want to reassure them that although the decision is
being
4550
appealed the government recognizes the need to improve the
child support system.
The fact remains, however, that the court's ruling has led to
tremendous uncertainty and possible chaos in Canadian family
law. As well, in dealing with only the income inclusion and not
the deduction the ruling has created an unbalanced system.
We expect to achieve significant progress toward a better
system by the end of this year. That includes reviewing the tax
system, legislating child support formulas to simplify the
system and finding more effective ways to enforce support
orders.
[Translation]
We hope to be able to make significant improvements by the
end of the year, specifically through revision of the tax system
and legislative measures on child support formulas in order to
simplify the system and with a view to finding more efficient
means of enforcing support orders.
(1110)
[English]
I am confident that the insights Canadians will provide the
task group will make a major contribution to this important
work.
I thank the hon. member for her motion and the House for the
opportunity to speak today.
Mr. Ian McClelland (Edmonton Southwest): Mr. Speaker, I
too am very happy to speak to this motion and I wish to
congratulate the hon. member for Nepean for bringing it to the
floor.
The motion, for those watching this on television, has to do
with the taxing of child support payments. It states that taxes on
child tax support payments should be paid by the payer rather
than the recipient. On its face it tends to make sense, but when
we delve into it a bit deeper we find a host of interrelated
considerations.
This bill is particularly timely following as it does the
Thibaudeau decision recently received from the Supreme Court.
This decision has caused a general review of the whole situation
of tax status and the support paid to families after a marriage
breakdown.
I have a couple of insights I would like to bring to this debate
and to the broader debate, but I want to assure those watching on
television that whether this bill survives or passes the
Commons, this is not the end of the story. It will go on.
Parliament will come to a reasoned position, one that will be
satisfactory to all of the various perspectives on this issue.
The broad perception is that the tax treatment is not fair. I
have a fair amount of personal experience in this because I have
been paying maintenance payments, as many people have, for
years. My ex-wife and I have talked at great length about this.
We have come to an agreement outside the judiciary on how we
would handle it.
The real problem was alluded to in a presentation by the hon.
member who preceded me. It is that the vast majority of people
who are required to make maintenance payments do not and they
skip. When we are looking at this we have to look at it in the
broader context. How do we get the deadbeat parents to accept
responsibility for looking after the children that they brought
into the world? Why is it that every time we turn around in our
country we are able to escape whatever responsibilities we
should have as individuals and pass them off to the state?
The broader question is how do we go about nailing the
deadbeats, whether they are male or female. Perhaps we should
look at changing the income tax structure so that if money is
paid by the state, then the people who owe it have to pay it back.
If the individuals owed the tax department the money, would
they get away with it? I think not. If they do not make their
payments and look after their responsibilities we as a people, as
a nation, are forced to look after their responsibilities.
As we go down this road it is going to be very important not
only to consider what is fair to the people who are involved, but
what is fair to the taxpayers and to once again inculcate the sense
of responsibility to people when they bring children into the
world to look after their responsibilities.
The problem is interprovincial because if people skip from
one province to another, they have to be tracked. It is a question
of will. If people involved in the breakdown, in the divorce, are
rancorous and do not want to pay, how do we go about doing this
with a sense of fairness so that they will pay? It is the children
who are involved that we want to protect.
I would like to read briefly from a very thoughtful letter I
received from a constituent on this issue just the other day. Her
name is Zanne Cameron and she wrote quite a long and involved
letter. It is very touching:
As a single parent receiving support payments, I was immediately bumped
into a 33 per cent tax bracket. The GST was introduced the same year, and I have
seen health care premiums increase from $80 in 1983 to $180 quarterly in 1994.
A middle class income is no longer $35,000 a year. It is somewhere over
$45,000 or more. Yep, it is tough out there. You know what, though? It is not
tougher for me than for married couples or single people with no children.
Making a living is not easy.
(1115)
In the broader context of doing what is right, we have to do
what is right for the family. The question then comes up, if
people are not divorced and choose to stay home and raise a
family or if one parent does, how is it that family then does not
4551
get the same tax break? That family cannot income split the
same as a divorced family does.
We should be ensuring there are reasons for families to stay
together rather than to break up. We cannot look at this as a
straight forward tax this person or tax that person situation. We
have to look at it based on what is best for the children and what
is best in the context of our nation.
I would like to read once more from Miss Cameron's letter:
No matter how you dice it, support payments are income to the receiving
parent. This is not really a feminist issue at all. All parents, single or married,
must pay taxes on their income. We as women are not special here, nor are we
the only single parents. The fathers of these children are also their parents, some
more so than others, but these are private issues. I do not feel that it is fair to
assume that all divorced men with children neglect them.
In conclusion, we cannot automatically assume every
marriage breakdown is the same. We cannot automatically
assume every divorced dad or every divorced mom is not
conscious of their responsibilities and may not end up being a
better parent because of the situation they are in.
Miss Cameron goes on to make a solemn kind of suggestion
which is that the income be split. The more one thinks of it, the
more sense it makes. Rather than taxing all one or the other, split
it down the middle and tax 50 per cent to the recipient and 50 per
cent to the payer. It does not necessarily have to be all one way
or the other. In a divorce, heaven knows there are all sorts of
very complicated issues which arise.
As part of a judgment why not decide who is going to get the
tax benefit so as to induce the most possible income will go to
the children? Why could it not be left that a person who is in a
fairly high tax bracket will make the payment to someone in a
low tax bracket to give the benefit of the tax deduction 100 per
cent to the payer? In another situation, if the recipient does not
want to pay any tax and the payer is quite happy to pay the tax,
then why could that not be done, or any combination?
We do not have to go all in one direction or all in another. If
for the sake of the tax department and for the sake of simplicity
we need to have it all one way or another, then it would seem to
me the appropriate thing to do would be to split it 50:50.
I want to reiterate to all of the people affected by the
Thibaudeau decision that on the face of it it does tend to make a
lot of sense. Many people out there think that perhaps this
Parliament is not sensitive to their needs. However, I want to
assure everyone that at least from this side of the House, I know
from the government side, but I think also from the Bloc, we are
going to work together as parliamentarians to come to an
agreement on this which will be palatable both to the payers and
the recipients and fair to all concerned. This is particularly to
benefit the children involved.
(1120)
Ms. Marlene Catterall (Parliamentary Secretary to
President of the Treasury Board): Mr. Speaker, I am pleased to
have this opportunity to speak in support of the motion of my
colleague, the member of Parliament for Nepean, and to
compliment her on bringing this issue to the House for debate.
In her motion the member is addressing a crucial factor
contributing to the poverty of women and children in Canada.
That is the tax treatment of support payments in cases of divorce
or separation.
Twenty years ago I first heard a woman who had been through
the experience deliver the warning that any woman is one
husband away from poverty. In 1994 the situation has not
changed much. The most recent report of the Vanier Institute
confirms that the majority of women who walk out of a marriage
walk into poverty. The actual figure is that two-thirds of women
whose marriages break up end up in poverty, along with their
children.
When Statistics Canada conducted its recent comprehensive
survey of women's experience of violence, it learned that 45 per
cent of women had experienced violent abuse during a previous
marriage; 15 per cent reported being victims of violence in their
current marriage. These figures indicate that women do leave
abusive marriages in great numbers, but to escape the danger of
a violent marriage they must be prepared to accept the abuse of
poverty.
When single mothers are poor, their children are poor. Since
this Parliament unanimously adopted a resolution to end child
poverty by the year 2000 the situation has become worse, not
better. At that time one in six Canadian children lived in poverty.
Now that ratio has grown to one in five, an increase by 20 per
cent of the number of poor children in one of the wealthiest
countries in the world.
As we promote better education and training, we ignore the
single greatest factor in children dropping out of school:
poverty. A poor child is four times as likely to leave before
completing high school.
As we try to address the challenge of maintaining a universal,
accessible health care system while containing its costs, we are
failing to address a significant factor adding to the demands on
our health care system: poverty. Poor children are many times
more likely to be seriously ill, to have serious accidents and yes,
to die than non-poor children.
The treatment of family income on the breakup of a marriage
is the significant factor in the poverty of women and children.
Report after report has shown the impact of both inadequate
support payments, the failure in 75 per cent of cases to pay the
support as ordered and finally, the taxation of support payments
in the hands of the custodial parent.
4552
Let me mention just a few of these reports from the last few
years. The Federal-Provincial-Territorial Family Law
Commission and its report on Financial Implications of Child
Support Guidelines, May 1992. The Ontario Fair Tax
Commission Report on Women and Taxation, November 1992.
The Status of Women Canada, Analysis of the Tax Treatment of
Child Support Payments, January 1993. Le rapport du
Protecteur du citoyen de la province de Quebec on Child
Support, Proposals for Reform, November 1993.
All these reports have said the same thing: the tax treatment of
child support payments needs to be changed. It is hurting women
and it is hurting children. All these reports identify the
taxability of child support payments in the hands of the
custodial parent as a major contributor to the poverty of women
and children. Canada is the only country in the world that taxes
child support payments in this way.
Most recently the Thibaudeau court decision has called the
tax policy discriminatory on the basis of marital status because
tax treatment for a couple supporting children is not the same as
for two separated people supporting children. Our government
has appealed this case in order to avoid the chaos of cases in the
thousands coming before the court to vary orders which were
established under the existing law and which some will argue
took into consideration the tax treatment of support payments.
(1125 )
The big losers again would be the custodial parents, most of
whom are women, and their children. Most of them do not have
the resources to ensure their interests are well represented
before the courts.
Our government is committed to achieving an orderly
transition from the present system to a better way. Our goals
generally are to increase the value of child support awards, to
simplify the process, and to create a more equitable system.
We realize the vast majority of single mothers in Canada
receive no support payments at all for their children and that the
vast majority of support orders are not obeyed. This represents
not only a burden to that majority of single parent householders
in this country, but to all of us as the responsibility for caring for
these families is often assumed by our social security system.
Our goal as a government is to achieve concrete results by the
end of this year, including reform to the tax system, legislating
child support formulas and finding ways of working with the
provinces to enforce support orders.
We know there are no easy answers. That is why an important
part of this process of finding solutions is listening to the
experience of people on the ground. That is why we have set up a
task force to consult with Canadians, to consult with those
involved with this most unfair system and to find those
solutions.
I want to congratulate my colleague from Nepean for bringing
forward this issue. With her motion she has ensured that at last
Parliament and not the courts will address the inequities of the
current tax laws. She will have to her credit what is all too rare in
our system: an action by an individual member of Parliament
that rights a wrong, that will potentially improve the quality of
life and the future prospects of over one million Canadians. I
congratulate her.
Mr. Pat O'Brien (London-Middlesex): Mr. Speaker, I
commend the hon. member for Nepean for bringing forth this
motion. This motion will help us participate in a much needed
debate on a very important topic.
Clearly the current system around the issue of child support
payments is unfair. It is outdated and simply is not working. The
hon. member has helped us to recognize this vital concern that
the system must be reformed and that we must find a system
which is fair to women, men and most especially to the children
who unfortunately experience the breakdown of the family.
Understandably, this has been a topic of interest in my own
riding of London-Middlesex and indeed obviously right across
this country. This is a vital concern which interests all
Canadians.
Both this motion and the Thibaudeau case show that the
current system is not working. It is outdated and in bad need of
repair. However, simply eliminating taxation of support
payments will not necessarily improve the situation.
Without discrimination against women I support the appeal of
the decision and the task force to consult further into taxation
measures and enforcement of child support payments. We need a
more balanced system which is fair to all involved. However, I
say again most especially we need a system that keeps as its first
priority an adequate level of support paid regularly and on time
to the children who have experienced the breakdown of their
family.
On a personal note, as an educator for some 21 years in
Ontario I can attest to the learning and social difficulties
experienced by many children who come from broken and
poorer families. All too often these children are unhappy in
school and they underachieve as a consequence. Let me hasten
to add there are many obvious exceptions to that. There are
young people who are so well balanced and mature they manage
to live through the breakdown of the family and carry on fairly
nicely to successfully complete their education.
(1130 )
I say again, and any teacher anywhere in this land can tell you,
all too often that is not the case. All too often these students have
a number of problems which must be overcome if they are to
successfully complete their education. Many times, unfortu-
4553
nately, that education is interrupted or prematurely ended
because of the problems that I have mentioned.
I commend the hon. member for this motion. We have heard
many people speak out on the issue in our ridings, in the media,
in this Chamber and obviously in the courts. Times have
changed and the legislation to deal with this important problem
must keep pace with the times.
As it now stands, the government is short $330 million in tax
payments and $660 million in deductions. The issues that this
case and this motion raise go far beyond narrow questions of
taxation or legal interpretation. Most important and as part of
his comprehensive review of social programs, the Minister of
Human Resources Development in co-operation with the
provinces will have to come to grips with the fact that the vast
majority of single mothers in Canada receive no support
payments at all for their children and that the vast majority of
support orders are not obeyed. That is a pathetic fact that I think
we all acknowledge. Indeed, one of my colleagues across the
way spoke to this on a more personal basis earlier.
We simply cannot have the courts and the laws of this country
flouted in such an important area as the support of one's
offspring.
The system dates back to 1942. That date alone calls to mind
that the system is outdated. The problem was that lawyers and
judges frequently failed to increase payments to offset taxes.
High income fathers got off without paying tax on part of their
income while children suffered to make up the shortfall. Even
with the tax benefit a majority of support agreements are in
default in Ontario and some two-thirds of children from
separated families live in poverty. That point has been made
before in this House and today again, but it is a point that is so
dramatic that it cannot be made too often. Some two-thirds of
children from separated families live in poverty and the fallout
of that, both in the school systems and in society at large, is
incalculable. It is really a major problem that our society must
come to grips with.
A modern and comprehensive approach would boost
enforcement and set minimum support guidelines to ensure that
children are properly served.
I am pleased to see the emphasis on fairness to Canadian
women and I am sure the first people to support this would be
those very women. The priority must at all times be the children
involved. Whatever is going to be most effective to make sure
that they are adequately cared for is the system that I and
Canadians want to support.
To sum up, an appeal of the Thibaudeau decision may not
seem necessary since Ottawa and the provinces are already
studying ways to improve child support guidelines. I think the
appeal is a good step as it will help us come to grips with the
system in a more comprehensive way and to find that balanced
system which we are sorely lacking right now.
Because the court only examined one side of the formula, the
tax but not the deduction, there is this imbalance of which I
speak. The father can claim the deduction but the mother no
longer pays tax, a far richer subsidy than anyone intended. I do
not think there can be anyone in this House and I have heard
from very few Canadians who would object to the statement of
the hon. Minister of Finance. He put it very succinctly and he put
it very well and with common sense: Someone has to pay the tax.
The fact of the matter is that someone must pay that tax. It
cannot simply be forgone.
In closing, I support the task force chaired by the Secretary of
State for the Status of Women because I fully recognize with the
government the need for change. Again I commend my hon.
colleague from Nepean for her motion. I hope the end result of
this process will be a much fairer system recognizing the needs
of the children.
(1135 )
Mr. Paul DeVillers (Simcoe North): Mr. Speaker, I am
pleased to offer my support to this motion which calls for the
government to amend the Income Tax Act so that child support
payments are no longer considered taxable income for the
recipients.
I would first congratulate the hon. member for Nepean for
raising this matter in the House of Commons.
Last March I wrote to the Minister of Finance urging him to
make changes to the Income Tax Act in order to rectify this
inequity. In the past few weeks the issue was thrown into a state
of chaos by the Federal Court of Appeal rendering its judgment
in the well publicized Thibaudeau case.
In effect the court ruled that separated custodial parents did
not have to include child support payments as part of their
income when filing income tax returns. This decision has raised
public attention to the urgency of reforming the Income Tax Act
with respect to child support payments. I am proud to see that
this government recognizes the importance of this issue and is
already taking measures to address the matter in the fairest way
possible.
[Translation]
I have no problem supporting this motion as well as the
government's recent decision to appeal the Federal Appeal
Court's ruling. I must admit that, at first, I was having my doubts
regarding the government's decision, but I then realized that
appealing this judgment would better serve the interests of those
who were the most concerned, namely children.
4554
[English]
The government appealed the Thibaudeau decision so it may
come up with a better arrangement to avoid a potentially
disastrous situation in the meantime. It is my understanding that
the court's ruling is causing much confusion among both
support payers and recipients.
Lawyers from across the country are receiving phone calls
from clients who want their support payments lowered. If the
court ruling was allowed to stand thousands of applications
would have to be litigated, Canadian courtrooms would be
clogged and the result would be needless anguish and expense
for all parties concerned.
In addition, it is also thought that the recent court decision
would further aggravate the problem of failure to pay support
payments since non-custodial parents would have less incentive
to comply with court mandated support payments without the
benefit of tax deductions.
Moreover, since the federal appeal court's decision did not
deal with the deductibility of child support by the payer it left in
question how the tax will be paid on income that is directed to
child support.
If the ruling was left untouched its effect would be that
separated parents unlike other parents would not be required to
pay taxes on money they use to support their children. Clearly
this type of scenario would create a very unfair situation for
married couples with children.
[Translation]
The government, realizing that a change is due, is going to
consult Canadians who are the most directly affected. The
Secretary of State for the Status of Women will head a task force
made up of MPs, which is to hold a series of public hearings,
very shortly, on various issues regarding child support,
including the tax system, and report to the government.
Moreover, the Minister of Justice asked a
federal-provincial-territorial committee on family law, which
is presently looking into a whole range of issues concerning
child support, to present its report before the end of the summer.
The findings of the task force and of the family law committee
will guide the government in its review of a new and fair child
support system.
[English]
Currently there are over 1.2 million children who live in
poverty. If we consider that among female lone parent families
62 per cent have income below the poverty line it is easy to see
where the majority of these children come from.
In my opinion, the tax rules relating to child support payments
probably have something to do with these grim statistics.
I believe the question at hand is one of fairness for single
parents and their children. Child poverty has reached
frightening levels in this country. It must be dealt with now. This
government will soon introduce measures that will improve the
circumstances of single parents and their children. By making
reforms to the tax system and legislating child support formulas
to simplify the system, this government will demonstrate its
commitment to tax equity and reducing child poverty.
(1140)
This is a very important area of social policy and merits a
great deal of the government's time and attention. Unfortunately
the opposition parties are much more preoccupied with
constitutional issues and questions such as law and order. The
threat of Quebec separation creates economic instability and
stifles our growth, but worst of all it detracts our attention from
important social matters that need to be addressed urgently.
I am sure the members of the Reform Party would notice a
huge difference in the crime statistics they quote so often if
issues such as child poverty were the priority of all members of
this House.
Ms. Roseanne Skoke (Central Nova): Mr. Speaker, I am
pleased to speak to the motion today. I congratulate the hon.
member on behalf of Canadians families for taking the initiative
to bring this bill forward.
Tax treatment of child support is not merely an issue of
taxation. The tax treatment of child support goes to the
fundamental principles of justice and equity. The paramount
consideration in determining the issue of tax treatment of child
support must be in the best interest of our children and in the
best interest of the family, not the legal or economic
considerations which are often the determining factors in
taxation issues.
Fundamental to this legislative debate here today are the
principles of equity and fairness. To tax child support payments
is inequitable. To give a tax deduction to the payer of child
support is inequitable.
During my 17 years of practice in the field of family law I saw
the burdens that exist as a result of the inequities both economic
and social and that are still existing today due to the marriage
breakdown and the breakdown of families and family life.
The economic and social inequity is borne by the custodial
parent who is left without the burden to provide the financial and
the non-financial contribution to the support of the children as a
result of marriage breakdown.
I draw the attention of the House to the Moge and Moge
Supreme Court of Canada case and its reasoned judgment which
gives details of the hardship, the economic disparities, poverty
and inequities that exist as a result of marriage breakdown in our
society today. I also draw attention to the allocation of child
support, the quantum and the inequities that exist throughout
4555
our country. I recommend this decision to members for their
reading for background information.
Another inequity that exists is that a payer of child support
should be rewarded with a taxation deduction to provide an
incentive to support one's very own family. We should question
the underlying issues of morality and equity and ask why
Canada is the only country in the world to tax child support
payments and to provide such a deduction to the payer.
Another inequity in the present system is that the families that
stay together and are united in marriage are not provided a tax
deduction or allowed income splitting to provide economic
equity for our stay at home mothers or one income families.
In conclusion, in keeping with the fundamental principles of
justice and equity and to afford legal, economic and social
protection of our families as they exist today, all the inequities
that are raised in this bill must be addressed without delay.
Mr. Ronald J. Duhamel (Parliamentary Secretary to
Minister of Public Works and Government Services): Mr.
Speaker, I am pleased to be given the opportunity to speak on
this particular proposal.
The Thibaudeau case has occurred, the appeal has been
undertaken, there will be hearings, but what is important at the
end of all of this is to remember the following. Most people, and
most often women, do not get child support payments. Many of
those who do-and I am told it is a majority-do not get them
paid and many who do get them paid do not get them paid on
time. It would seem to me that unless these particular problems
are corrected at the end of the process we have done a great deal
for very little.
(1145)
Let us remember there is a great deal of inconsistency
throughout the country with respect to child support payments.
Let us remember that one can be given a particular award in a
particular province in a particular situation. Yet there can be a
like situation and the award can be entirely different. That is
within the one province, let alone comparing provinces and
territories.
Let us also remember that most people rearing families after
broken marriages are women. Let us remember that women's
earnings, their ability to earn and to spend on themselves and
their families, are reduced significantly as a result of marriage
breakdown. Let us remember that whenever they attempt to get
justice, either to have an appropriate amount paid or to have
whatever was decided paid on time, it often costs them a great
deal of money; most often resources they do not have.
[Translation]
Therefore, in my view, it is a matter of fundamental justice. A
number of things have occurred. A ruling was handed down, an
appeal will be launched and public hearings will be held across
Canada. That is all well and good, but, as I mentioned earlier, if
the problems I have identified-and I identified only a
handful-are not resolved, it will be most unfortunate, because
one thousand women, hundreds of men and thousands of
children are adversely affected. There are no specific provisions
in place to ensure that children do not fall into the poverty trap,
that they receive what is rightfully theirs and that they enjoy the
same opportunities as children who do not come from broken
homes.
[English]
Those are the few comments I wanted to make. I reiterate that
if at the end of the process the problems I have identified are not
corrected it will be for naught. In most cases women and
children suffer. We must correct that for their sake.
Ms. Mary Clancy (Parliamentary Secretary to Minister of
Citizenship and Immigration): Mr. Speaker, I am delighted to
have the opportunity to make a few comments in this debate. I
begin by congratulating the hon. member for Nepean on
bringing forward the motion. Her interest in and her support for
women and children caught in untenable situations have long
been known. We are all very grateful to the hon. member for
Nepean for bringing it to the forefront in the House of
Commons.
With regard to the whole way the income tax system deals
with the questions of child support and maintenance, there is a
rather high level of misapprehension and misunderstanding out
there among even those people who are involved in the system.
The first thing to remember is that we have a very bad rate of
collection of maintenance and child support in the country.
Currently only 37 per cent of child support orders are
enforceable in Canada.
When I started practising law in 1980 it was worse. The
non-compliers were in the high nineties. However clearly 63 per
cent of child support payments are unenforceable and in the
province of Ontario 80 per cent are either unenforceable or in
arrears. That is unacceptable in a country like Canada. That is
why I want to speak very much in favour of the government's
initiative in setting up the task force to go across the country to
consult with Canadians, the women who receive these payments
on behalf of themselves and their children, the men who pay the
payments, and the lawyers who represent them both.
The ramifications of the Thibaudeau case are not simple.
They are very complex. The problems of the tax system are not
simple; they are very complex.
4556
(1150)
We have here a question of fairness, not just fairness to those
people who are the payers and payees of child support but
fairness to families as my colleague from Central Nova and
other colleagues have mentioned. There is a question of fairness
to those mothers and fathers who co-parent and who also need
tax breaks.
There is the question of poverty among women and children.
It is very important to note that we should not separate women
and children. The number of children who live below the
poverty line is unacceptable and in the vast majority of cases
their mothers live with them. We have to look at the problem and
deal with it in the broader sense, not merely in the context of the
Thibaudeau decision and in the context of the Income Tax Act.
Fair taxes are something that we on this side of the House are
very concerned with. It is absolutely crucial that Canadians, and
Canadian women in particular who think the Thibaudeau case
was a bonus for them, understand there is more to it. We must
have a policy.
I commend the Minister of Finance, the Minister of Justice,
the Parliamentary Secretary to the Minister of Finance and the
Secretary of State for the Status of Women. This task force will
bring us the consultations we need to formulate the policy.
Hon. Warren Allmand (Notre-Dame-de-Grâce): Mr.
Speaker, I will be very brief. I simply want to say how much I
support the motion of the hon. member for Nepean.
As other members have pointed out, in other countries
including the United States, there is no tax on child support
payments to women who receive them. Yes, there is taxation on
alimony payments to former wives, to formers spouses, but not
on child support that is sent to a mother. If they can do it in the
United States certainly this is one area where we can copy them.
I also simply want to make the point that fathers who are still
in the family have the obligation in the family to support their
children. There is no special tax break of the same nature that
they have under the present law.
I simply as another member want to fully support the
initiative of the hon. member for Nepean and hope that the court
appeal will in no way impede in the long run what she is
attempting to do.
Mrs. Beryl Gaffney (Nepean): Mr. Speaker, I would just like
to have the consent of the House for a few moments to close the
debate on this very important matter.
The Deputy Speaker: Is there unanimous consent, given that
the time has expired, to grant a few more moments to the hon.
member for Nepean?
Some hon. members: Agreed.
Mrs. Gaffney: Mr. Speaker, I wish to thank everyone on all
sides of the House for speaking in support of Motion M-14.
The motion has received a tremendous amount of interest
right across the country. There have been an incredible number
of contacts made to me personally from every province, from
women, from custodial parents and from payers whom I want to
thank publicly in the House of Commons.
This motion was born because of the plight of children. We as
a nation have said consistently that to look after children we
must decrease poverty. We must ensure that our children are
properly looked after.
It was because of people bringing the issue to my attention
during the recent federal election campaign that I brought the
issue forward in the House of Commons. It has been a great
privilege for me to have had the opportunity to present it and to
have three one-hour debates on the votable motion before the
House.
Again, on behalf of all parents and all children, I hope we have
unanimous consent in the House to approve the motion. I thank
the Minister of Finance and the Minister of Justice. There is no
doubt in my mind that we will move ahead to enact some change
to the Income Tax Act to allow the children to be better taken
care of.
[Translation]
Mr. Gagliano: Mr. Speaker, before you ask us to vote on this
motion, as chief government whip, I would like to announce that
this vote will be a free vote as usual. All votes on private
members' business are free votes, and this one will be no
exception.
(1155)
[English]
I just said in French that before Your Honour asks us to vote I
would like to announce as chief government whip that the vote
will be a free vote as usual in Private Members' Hour.
[Translation]
The Deputy Speaker: Pursuant to Standing Order 93, the
hour provided for the consideration of Private Members'
Business has expired.
Is it the pleasure of the House to adopt the said motion?
Some hon. members: Agreed.
Some hon. members: No.
The Deputy Speaker: All those in favour will please say yea.
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
Some hon. members: Nay.
4557
The Deputy Speaker: In my opinion the yeas have it.
Some hon. members: On division.
The Deputy Speaker: I declare the motion carried, on
division.
(Motion agreed to.)
_____________________________________________
4557
GOVERNMENT ORDERS
[
Translation]
The House resumed, from May 26, consideration of Bill
C-17, an act to amend certain statutes to implement certain
provisions of the budget tabled in Parliament on February 22,
1994, as reported (without amendment) from the committee;
and of Motions Nos. 23 to 38.
The Deputy Speaker: Resuming debate on the motions in
group No. 5 or Motions Nos. 23 to 38 inclusive.
Mr. Michel Daviault (Ahuntsic): Mr. Speaker, I am pleased
to speak on Bill C-17, an act to amend certain statutes to
implement certain provisions of the budget tabled in Parliament
on February 22, 1994.
The provisions of Bill C-17 respecting unemployment
insurance are unacceptable, as a whole and individually,
particularly as far as benefit rates are concerned.
In my speech on the budget, I reminded the House at the time
that Montreal has become the capital of poverty. In March 1994,
according to Statistics Canada, there were 151,270 UI recipients
in Montreal. In the greater Montreal area, 18.5 per cent of
families are living under the poverty line.
I have asked a question about the effects the increase in
unemployment will have. The unemployment rate has grown
from 9.1 per cent in December 1989 to 13.8 per cent in
December 1993, exceeding the growth of the unemployment
rate in Saint John's, Newfoundland, for the same period, while
in Toronto it had gone from 4.1 per cent in December 1989 to
11.5 per cent in December 1993. I also pointed out that, even
before consultations on the needs of the population start, the UI
reform would have an absolutely catastrophic effect on the
provinces' finances.
The budget measures will result in an increased need for
social assistance at the expense of the provinces which will then
have to cut, as usual, in their social programs and services
because transfer payments are frozen.
Last Thursday, Statistics Canada announced that long-term
unemployment had increased in 1990, 1991 and 1992, which
means that fewer people received or qualified for
unemployment insurance. It is estimated that more than 10 per
cent of unemployed workers have turned to provincial social
assistance programs.
The Bloc Quebecois has proposed that this Bill, in Clause 22,
be amended by replacing line 16, on page 11, with the following:
``(ii) the greater of 57 per cent of the''.
The purpose of this amendment is simple. At present, the rate
of weekly benefit payable to a claimant is equal to 57 per cent of
his average weekly insurable earnings; the government plans to
reduce this rate to 55 per cent. The Bloc is merely asking to
leave it at 57 per cent.
As we know, insurable earnings are based on average
insurable weekly earnings over the reference period. For
example, a person whose average insurable weekly earnings
amount to $620 would see his or her benefits decrease from $353
to $341 if the bill is passed without amendments.
The government tackles its deficit by gradually eroding the
benefits of the poorest.
Let us also keep in mind that the benefit rate will be reduced
from 57 per cent to 55 per cent for about 85 per cent of
recipients.
(1200)
Once again, government savings are achieved on the backs of
the unemployed. I would like to remind you that businesses
whose annual UI contributions are less than $60,000 qualify for
a tax credit to cover the increase in their contributions up to
$30,000.
What a funny UI program: the government does not have
money to pay benefits to the unemployed but finds the necessary
resources to pay some employers' contributions to that same
plan. Another double standard, not to say anything about social
equity.
The changes to the benefit structure are simply designed to
erode income replacement programs and introduce the principle
of justification based on means. The double benefit rate
structure is outrageous. Like the Canadian Labour Congress, we
must recognize that workers' income is not based on their
family status any more than their premiums, hiring or dismissal.
For a government to conceive such a program strongly
contradicts the principle of income replacement and other
aspects of the labour market; it is a disgrace. This government is
destroying the basic principle of income replacement that was
the hallmark of the Canadian UI program for many years.
The formula described in clause 22 whereby a higher benefit
rate would be given to low-income claimants with dependants
hides the fact that other planned changes in this bill will
decrease the benefits paid to these same people.
In fact, the advantage of a higher benefit rate will be cancelled
by the stricter eligibility standard, a reduction of 12 to 10 weeks
of work and a reduced benefits period. The real reason for this
bill is to reduce benefit levels. I remind this House that the
benefit level has already been reduced twice: from 66 to 60 per
cent of salary under Bill C-21 in 1990 and from 60 to 57 per cent
4558
of insurable earnings through the amendments made in Bill
C-113 in 1993.
How can the public not be cynical towards governments when
it sees this Liberal government pursue the very policies it
denounced when it was in opposition barely a year ago? I will
take this opportunity to quote the present Prime Minister in a
letter dated March 26, 1993 to opponents of Bill C-113: ``The
Liberals are dismayed by these measures. By reducing benefits
and further penalizing those who voluntarily leave their jobs,
clearly the Conservative government cares very little for the
victims of the economic crisis. Instead of attacking the real
problem, it is attacking the unemployed-'' That was barely a
year ago.
Conservative or Liberal, it is the same thing. The poorest
people, who are the victims of this system, are attacked. The
proposed changes in Bill C-17 will lower the benefit rate for the
great majority of claimants to 55 per cent. The lower benefit rate
was adopted for just one reason: to reduce spending on
unemployment insurance.
Like others, including the Public Service Alliance, I reject the
two-rate benefit structure described in this bill, as well as the
lower general benefit rate. In fact, it is important for benefits to
be paid to all claimants on the basis of their former employment
income.
The government points out that the 60 per cent benefit rate
will apply to only 15 per cent of claimants. However, I will add
that the reduction of the benefit rate from 57 to 55 per cent will
apply to 85 per cent of claimants. The Canadian Labour
Congress points out that the higher benefit rate, even the 60 per
cent rate for recipients with dependents and a low income, is not
designed to increase the protection afforded to the unemployed.
The $12 per week involved is cancelled out by more stringent
eligibility standards or the duration of benefits, or both. In the
case of workers deemed ineligible because they cannot even get
12 weeks of work, this means a total loss. The government did
not tell us how many of those recipients who earn less than $390
per week and who have dependents will lose everything.
(1205)
With this measure, the Liberal government is getting closer to
the American pattern regarding weekly insurable earnings.
Indeed, Canada reduces its rate from 57 to 55 per cent, while in
most American States that rate is 50 per cent.
Taken together, the new unemployment insurance measures
will translate into savings of $725 million for the government in
the first year, and $2.4 billion in the two subsequent years. This
decision however causes a serious prejudice to the unemployed,
who will see their purchasing power diminish and will thereby
make less of a contribution to the economy of their region and
community. The government is only creating a greater gap
between the rich and the poor.
[English]
Eighty-five per cent of the claimants of unemployment
insurance will lose money in order that the government may
avoid the painful exercise of cutting costs of government
operations. Only claimants who have both dependants and a
dismally underpaid job will be able to receive 60 per cent of
insured earnings.
[Translation]
Like Quebec with the ``boubous macoutes'' of the Quebec
Liberal government, the rest of Canada will see the emergence
of its own flock of overzealous federal civil servants trying to
track down their quota of bad abusers the system. The witch hunt
is on.
For the most part, it is divorced workers responsible for single
parent families who will have to prove that they have
dependents. What an incredible mess! The government is adding
yet another administrative level, ``jobs, jobs, jobs'', at the
expense of taxpayers, to harass the unemployed.
Some used to say ``poor Canada''; now, thanks to the Liberal
government, this country will be even poorer.
[English]
Mr. Dennis J. Mills (Parliamentary Secretary to Minister
of Industry): Mr. Speaker, I am happy to have an opportunity to
speak on Bill C-17, an act to implement budget measures.
The Bloc Quebecois members are missing a central theme in
the budget. It has to do with small and medium size business. We
campaigned last summer on the fact that small and medium size
business represented the greatest hope for putting Canadians
back to work.
As Liberals we said that if the 900,000 men and women who
owned or operated small and medium size businesses were given
a proper environment, the chances of hiring Canadians were
very good. A central theme in this budget has been to try to
create that environment that will cause that entrepreneurial
spirit to move forward again.
There are a number of things that one has to do to create that
environment and they have all been listed in the budget. Of
course one of the very first items that we said we would address,
and we did say this in the budget, was access to capital for small
and medium size business.
All members of the House have been working on that issue
over the last three months. We are beginning to get some
movement. It is amazing that when the opposition stands up, it
picks one or two little pieces. It is all negative. It cannot seem to
find anything positive that we have done here in the House of
Commons or in committee in the last few months.
4559
Another theme in the budget which is related to the bill that
we are talking about today has to do with making sure that we
encourage our small and medium size entrepreneurs to trade
more on the international scene, on the global scene.
As members of Parliament, we have to be more creative when
we are looking at this budget and use it as an instrument of hope
as well as a way of giving guidance to some of our small and
medium size businesses.
(1210 )
Last week a group of parliamentarians from the government
side went to China for 12 days with 120 small and medium size
businessmen and women from every region of this country. I
would say through you, Mr. Speaker, to the opposition that over
90 per cent of them had never gone on a foreign mission before.
Going to China was a totally new experience.
We discovered number one that there is an economy over
there which is very receptive to doing business with small and
medium sized Canadian firms. It is not just the larger Canadian
firms that they want to do business with. In fact unlike a few
years ago when China was a place where it would take
sometimes as long as 10 years to complete a deal, today they are
moving in a very expeditious way.
I believe if we as parliamentarians would become more aware
of the economic opportunities that exist in a country like China
for our small and medium size business, we would then look
more at this budget that the Minister of Finance has put forward
where he is trying to create an environment which will inspire
that sector to take risks, to have the courage to move forward, to
hire again. If we showed them that their markets are not just in
North America but that there are tremendous markets as well in
the Asia Pacific region, I think we could trigger this economy
that we are all working desperately on to move forward.
My message today on Bill C-17 is the fact that all of the
components of the budget are an attempt to create a total
environment which will allow small business to reinvent itself,
to retool itself, to allow it to rethink its whole strategy for the
new economy.
If we approach the budget knowing that all of those options
exist then we will probably have a better chance of putting
Canadians back to work. The member said earlier in his speech
that jobs must be our focus. I think realizing that objective
would be a lot more realistic.
[Translation]
Mr. Pierre de Savoye (Portneuf): Mr. Speaker, like all my
colleagues, I am here today to speak to Bill C-17. For the benefit
of those listening, I would like to recall the purpose of the bill
before the House today. Bill C-17 is what is commonly referred
to as an omnibus bill, a kind of catch-all that contains measures
affecting a number of different acts and programs. It is a mixed
bag of provisions, the only connection between them being that
they are intended to implement proposals contained in the
budget brought down on February 22, 1994.
Of course when we talk about the budget, we talk about money
and when we talk about money, we can talk about so many
things, which is also the case today. Again, for the benefit of our
listeners, this bill contains amendments to the Public Sector
Compensation Act, the Governor General's Act, the Judges Act,
the Parliament of Canada Act, the Salaries Act, the Canada
Assistance Plan, the Public Utilities Income Tax Transfer Act,
the Atlantic Region Freight Assistance Act, the Western Grain
Transportation Act, the Broadcasting Act and the
Unemployment Insurance Act.
(1215)
Mr. Speaker, as you can see, a large number of acts and
programs are affected by this so-called omnibus bill. Our
listeners will probably have noticed that, in their presentations,
members have approached these subjects in various ways.
Today, I intend to discuss the Unemployment Insurance Act.
There are eight measures in the bill that will affect this
legislation. However, it has been two years since in Quebec, the
Société québécoise de développement de la main-d'oeuvre has
been prepared to take full responsibility for manpower, and
unemployment insurance is one aspect of this sector.
Unfortunately, like the Conservative government, the Liberal
government has yet to act on the requests made by the
Government of Quebec and, instead, is proposing new measures
that have made it incumbent on us in the Bloc québécois to try to
make the best of a bad situation, in other words, to take the
measures and make the necessary changes that would prevent
them from having a negative impact.
For instance, I would like to draw your attention to clause 22
in Bill C-17 which deals with the difference in rates of benefit
for a claimant without dependants and for a claimant with
dependants.
We know that in the case of claimants without dependants, the
bill proposes a rate of benefit that is 55 per cent of insurable
earnings, while in the case of claimants with dependants, the
rate is 60 per cent. The intent of the bill is commendable because
it goes without saying that claimants with dependants do indeed
have additional financial requirements.
Our concern stems from the fact that there is no clear
indication in the bill before us on whom the burden rests to
prove that the claimant does or does not have any dependants.
We are concerned that, as the bill is now worded, the burden of
proof rests with the claimant. My colleague who spoke earlier
alluded very clearly to this point. If this is in fact the case, the
bill creates problems for claimants who will be required to prove
that they do indeed have dependants and who will experience an
additional delay in receiving their benefits, not to mention all of
the bureaucratic frustrations this process is likely to entail.
4560
For this reason, the Bloc Quebecois proposed an amendment
which reads as follows:
For purposes of paragraph (1)(b), a claimant needs only to establish a prima
facie entitlement.
All the claimant would be required to do is acknowledge or
confirm that he or she does in fact have dependants. The rate of
weekly benefit provided under that paragraph would thus apply.
The burden would rest squarely with the Commission to prove
that the claimant was not entitled to this rate of benefit. In my
view, this amendment would protect in the best possible way the
interests of the public and, in particular, of those individuals
who do have dependants and who would thus need to do nothing
more than simply say so.
When people file their income tax returns, they state certain
facts. The Department of Revenue takes it for granted that the
facts are correctly stated, and the onus is on it to prove
otherwise.
Moreover, most single parent families-and it is a fact of life,
one that I am not passing judgement on-are headed by women.
And if the present wording of the clause in the bill is maintained,
it is a good bet that some of these single parents, most of whom
are women, will have to prove their entitlement by travelling,
losing time from work or time to be with their children, to go to
the commission and show that they have dependent children.
(1220)
I think that it is adding insult to injury by again giving single
parents more work to do.
Therefore, the purpose of the Bloc's amendment is to remove
the burden of proof from the claimants and also to
avoid-unfortunately, such things have already
happened-setting up welfare police to investigate in the
neighbourhood of these claimants who say they have dependants
and to verify the accuracy of their statements, an approach that I
find inappropriate, to say the least, in a civilized society like
ours.
We admit that controls are required, but we say that care must
be taken in the way that they are exercised. In this context, we
believe that it is not only right but necessary for the burden of
proof to be on the commission so that people will not have to
worry and fret in order to prove their good faith; the good faith
of everyone concerned should be assumed.
As I mentioned earlier, unfortunately those who can benefit
from such a measure are usually those with the lowest salaries
and, quite often, these job categories are in direct relation with
the educational level. This is not merely a point of view: it is a
statistical fact.
These less educated recipients do not always know what to do
to protect their interests or have access to certain remedies.
They are not always able to express themselves easily and
defend their position.
Should these people, who are already less privileged by
society, have to shoulder an additional burden?
Finally, as I also mentioned, women responsible for single
parent families have neither the time nor the means to take care
of an injustice done to them. Yet, they have to do it to get the 60
per cent to which they are entitled, or else they will only receive
55 per cent of their insurable earnings. This gap will create
enormous problems, particularly for these people who,
generally, can barely afford to pay for their rent and food. Yet,
they are asked to take on a responsibility which the commission
would be in a much better position to assume.
In conclusion, I ask the House to approve this amendment,
since it would not affect in any way the increase provided for
recipients with dependents, but would give to the
implementation of this clause a human dimension which would
take into account, among other things, the plight of single parent
families, and which would ensure that a good decision is taken
in the appropriate manner.
Mr. Ronald J. Duhamel (Parliamentary Secretary to
Minister of Public Works and Government Services): Mr.
Speaker, I am happy to make a few comments regarding this bill.
[English]
One of the first things I want to do is pick up on a number of
points that have been made in the debates and to show that there
is some inconsistency.
For example we talk about an omnibus bill. That is really
quite correct. Various members have indicated that they wanted
to see it separated. Perhaps people have observed that the only
real commentary that has been received, and a lot of it has been
received, has been on the unemployment insurance provisions.
If it bothered so many people that this is an omnibus bill, surely
they would taken each section and would have said this or that is
what I oppose, with respect to each particular part.
(1225)
I find it interesting why it should be so. Clearly people who
oppose, if they are sincere, must have some specific
recommendations to make on every single part of the bill. I have
not heard that.
[Translation]
It is confusing. I mentioned unemployment insurance, and I
really have no criticism to make on that. I believe that what the
Bloc would like to do is very clear. When dealing with an
omnibus bill and claiming that it would have been simpler to
consider each element, one at a time, because of the multitude of
programs involved, it seems to me that it should have considered
them one at a time, and said: ``This is what we suggest regarding
4561
A, what we want concerning B, what should be done respecting
C''. During a debate, differences of opinion are expected.
I see some of my colleagues from the Bloc Quebecois with a
smile on their faces. They must appreciate my remarks. I shall
go on then. The Bloc's discourse seems to be blatantly
inconsistent. I will give you an example. On many occasions,
not only their leader, but several Bloc members mentioned that
they would like to see expenses cut, that we spend too much
money, that the deficit and the debt are staggering-we do
agree-and that we should manage our affairs better; and then,
when the government decides to do just that, they claim that it
should not cut anything, and that instead it should spend more.
There may be some logic in all that, and I am sure that my
colleagues from the Bloc will come and explain to me where it
is, in a little while. I know how eager they are to help me
understand things.
A few days ago, they were blaming the government for its lack
of long term vision. Mr. Speaker, you and I know that, after a
few months in the House, or even a few sessions or Parliaments,
the opposition loves to repeat that the government has no vision,
no long term or short term plan, that it does not know where it is
going, and so on and so forth. After a while, it gets rather boring.
Let us be a little bit more creative. We do have a long term vision
called social program reform. I am quite sure that you have
heard of it since a few questions were put to the Minister of
Human Resources Development on the matter. Our long term
vision is to bring about changes that will meet the real needs of
all Canadians.
It seems to me that we should be working together on such a
project with a view to finding creative solutions and go on from
there. This past weekend, it was announced that we lived in the
best country in the world. This was fantastic news. I have a
feeling that after hearing this announcement from the United
Nations, my colleagues from the Bloc will work hard to help us
not only to appreciate what we have, but to build on our
achievements in order that we may maintain our top ranking and
remain number one, together!
In another speech, mention was also made of duplication. You
know as well as I do, Mr. Speaker, and I believe my colleagues
know it too, that duplication exists everywhere, be it at the
provincial, municipal or federal level. Regardless of the level of
government, members have a responsibility to endeavour to
eliminate costly duplication. This is a positive, much
appreciated way to cut government spending. Of course, the
discussion focused primarily on duplication between the
provinces and the federal government. No admission was made
of duplication at the provincial government level. No admission
was made of duplication at the municipal government level
either.
(1230)
My friends from the Bloc admitted that duplication existed,
but were not prepared to say how it should be eliminated.
However, they do propose one solution to the problem, and
that is to break the country apart. They claim that this would
spell the end of duplication. Let me assure you that this would
not be the case. In my opinion, this solution is rather hard to
defend, Moreover, it is becoming increasingly difficult for the
Bloc to defend it as well. As I see it, we are gradually
eliminating instances of duplication. We are making progress
and my colleagues are aware of this fact.
My colleagues in the Bloc also talked about a centralizing
government and they know-they are well informed, but I feel
that some members sometimes choose what they
prefer-Canada is the least centralized country in the world.
Yes, in the world.
They know that. They do not like to hear that; they are starting
to blush a little. But who knows, one fine day they may rise in
the House and say: ``Yes, you are quite right, but we wanted to
say that because we believed that it would advance our cause''.
I think that people are starting to understand that some things
are exaggerated and people do not like exaggerations. Listen, we
should bring together all kinds of reforms going on in Canada
now; because we live in the best country in the world, we ask you
to help us find creative solutions.
Yes, there is duplication. We are negotiating to remove
duplication and we are refining the machinery of government.
Listen, if we centralize too much, I think that we are ready to
look honestly, openly and co-operatively at how we could make
the machinery of government more flexible.
[English]
I would feel that I had not done my duty if I did not address a
few comments about some of the statements made by the
Reform Party. Reform Party members feel that this particular
omnibus bill is une aberration de quelque sorte. They are open to
the observation and accusation I made that if they were so
concerned about this particular bill why did they not take it one
piece at a time and tell us precisely what they would have done
to change it? They did not do that. No, of course not. Why?
Perhaps there were some politics being played. I guess politics
are played in this House on occasion, even I play on occasion.
Anyway, I was rather surprised that the Reform Party would
do something like that, condemn this omnibus bill and not bring
forward certain specific recommendations to every single part
of the bill. Perhaps that is still coming. Perhaps, perhaps,
perhaps. Who knows? I hope so because if not it would be a
flagrant contradiction.
4562
As I indicated, a lot of things have been said about
unemployment insurance par mes amis du Bloc. Of course
Canadians will realize if they believe that these cuts have been
undertaken, these changes are really rather severe. If the Reform
Party had undertaken these cuts they would have been draconian
and dramatic and they would have hurt a whole lot more. We
have heard all kinds of comments as to what they would like to
do and it is not a gradual cut; it is an amputation.
I have addressed most of the concerns my colleagues have
raised both from l'opposition officielle, le bloc Quebecois,
including the other opposition party, the Reform Party.
As I indicated today there are a number of flagrant
contradictions. Politics are being played and I think they rather
enjoy it. They are becoming rather good at it. I must commend
them. Most of them are quite good at it, but at the same time they
are not fooling too many Canadians.
Canadians are listening and they are asking if the solutions
were as simple as the Reform Party proposes, why were they not
resolved a long time ago? Of course they condemn the solution
of the Bloc. All of the ills of the world will be corrected
supposedly by the separation of Quebec from Canada. Nobody
believes that, not even my friends from the Bloc believe that.
Today, if my colleagues from the opposition parties will do it,
in view of the United Nations report which shows us as the best
country in the world, I hope we will start working together not
only to maintain that position but to improve it in the spirit of
co-operative federalism.
Mr. Grant Hill (Macleod): Mr. Speaker, I have the
opportunity to break new ground today and I hope the
parliamentary secretary will be listening carefully.
(1235 )
I will start by saying that I am in agreement with the
government on this portion of Bill C-17. I will be speaking to
the portion on unemployment insurance. When I hear that
Reformers are always negative and do not have any constructive
alternatives, I particularly would like to explain why I am in
agreement with the government on this issue.
We are talking about unemployment insurance program
reform. I agree that unemployment insurance does need reform,
in fact it needs more reform than is proposed. Of course the
government is going through a social program review which will
allow that to take place.
I referred to the red book on this particular issue and looked
for what I could expect from the Liberal government during the
election campaign. What I understood from the red book was
that the Liberals would work with the provinces to redesign
social assistance programs, so sorely tested in recent years, to
help people on social assistance who are able to work to move
from dependence to full participation in the economic and social
life of the country.
During the election campaign I had a fairly specific proposal
to place on the table for the unemployment insurance program
review which reads: ``The Reform Party supports the return of
unemployment insurance to its original function; that is, an
employer-employee funded and administered program to
provide temporary income in the event of unexpected job loss''.
It was a fairly specific proposal. It is fairly obvious that is more
specific than the proposal I had from my opponent on the other
side.
Frankly I was hammered on this and other social program
issues during the election campaign. I was hammered as being
uncaring, as being a person who was involved in slash and burn
cutting with no compassion. I must admit those allegations hurt
me a little because I entered the national arena of politics for
compassionate reasons.
In my line of work I felt government mismanagement had a
specific and significant impact on my life and my work and the
life and work of those whom I had treated. I came here for
compassionate reasons. I strongly believe that if our social
programs are continually eroded by fiscal mismanagement that
we will not have social programs and compassion will be very
weak.
Last week I had an opportunity to talk with a number of grade
12 students in my constituency. Reformers have decided that to
represent our constituents better we are divvying up our time
and one week when the House is sitting we are actually in our
constituencies. I took that week to talk to my grade 12 students.
I had a number of messages to give them. The one specific
message I had to give was that our government and our country
is in debt and in serious trouble. I went through the figures: that
we are overspending $110 million a day; that we are half a
trillion dollars in debt; that over 30 cents of every $1 is spent
today on interest; and that every social program is in jeopardy,
including their educational needs and wishes.
The figures were not particularly meaningful to those grade
12 students. I rethought my proposals as I spoke to them and
tried to put them into a frame of reference they could better
understand. The one thing which seemed to strike home was
when I said that every single one of them who sat in front of me
owed the federal government a brand new pickup truck.
I was specific when I said: ``Each one of you owes the federal
government a pickup truck. It is a two-wheel drive pickup truck,
not an extended cab. It does not have electric windows, no
options whatsoever. It has an am-fm radio. It does not have any
trick wheel covers on it. It does not have radial tires. It is a basic,
brand new pickup truck. That is what each one of you owes the
government''.
4563
(1240 )
Then I asked: ``If everything comes about that the government
today is proposing during its mandate, where will you be at the
end of that mandate at the next election?''. Each one of them and
every single Canadian will then owe to the federal government a
pickup truck with an extended cab, alloy wheels and radial tires.
This truck will now have an am-fm radio with a CD player and
electric windows. It is still a two-wheel drive pick-up, not yet a
four-wheel drive.
These youths asked me: ``What are you saying to us? How
long can this go on?''. It cannot go on forever. It was like saying
to them: ``Suppose you pump gas at a gas station and make $100
a week but every week you spend $115. How long could you go
on?''. Obviously, it cannot go on forever.
The message I took to those grade 12 students is that my
generation and we in this House are mortgaging their future. The
grade 12 students in Macleod asked me to bring their message
back to the House of Commons: Stop mortgaging the futures of
the youths of Canada.
I went through the Bill C-17 proposals. I went to the
summaries of the proposals suggested by the minister. It is
always interesting to read the summaries.
On unemployment insurance the summary on page 5 of the
minister's document indicates: ``Changes will require claimants
to work for longer periods in order to be eligible for the same
number of weeks of benefits. For example, a claimant with 36
weeks of work and living in an area of 12 to 13 per cent
unemployment is entitled to 50 weeks of benefits under the
present schedule. In order to have the same entitlement under
the proposed schedule the same individual will have to work for
52 weeks''. That is 36 weeks has changed to to 52.
The summary on page 13: ``The proposed changes to UI will
improve the linkage between work and benefits while enhancing
adequacy and fairness in the provision of income support. The
changes will contribute significantly to job creation by
providing premium relief beginning on January 1, 1995''. It is
interesting and every Canadian should pay attention to this:
There is a linkage between providing premium relief and job
creation. In this document the Liberal government is saying
something I say very strongly.
I had a personal intervention in my constituency office earlier
this spring. A seasonal worker came to see me griping about the
unemployment insurance changes being proposed by my
colleagues. He was griping because he had been on
unemployment insurance and would have to work longer to get
the same amount of benefits. It was a criticism of the whole
process.
He asked me what I thought as a Reformer about the Liberal
unemployment insurance changes. I asked him what he would
think if I told him I did not think a seasonal worker would soon
have unemployment insurance benefits if we continued going
the way we were.
I told him: ``You have told me your story about how you
worked very hard as a seasonal worker. You spent your summer
on a road paving crew last year. You worked overtime and made
$45,000 during the good time of the year. Then you went on
unemployment insurance. You told me you went on
unemployment insurance by choice''.
He had told me he did not really have to be on unemployment
insurance; he could easily have obtained a job with a transport
company. He had a class 1 licence and the company was dying
for him to come and work. However for the convenience of his
family which I can understand, he chose to stay home during the
winter to be closer to his wife. Therefore he would not be driving
some place far away in the U.S.
He chose to do that because unemployment insurance was
there for him as an individual who had made a significant
amount of money during another portion the year. The principle
of his being able to choose that over working when a job was
available to him is something we must address or we will not
have unemployment insurance.
I support the direction of this portion of Bill C-17 and I say
that with no rancour whatsoever. As it is one of my committee
responsibilities, I will push toward a significant change in the
principle of unemployment insurance so that it becomes what it
originally was.
(1245)
I will end today with the message that came from my grade 12
students in Macleod, that the Government of Canada stop
mortgaging the future of our youth.
[Translation]
Mrs. Christiane Gagnon (Quebec): Mr. Speaker, this is the
second opportunity I have to participate in this debate on the
Budget Implementation Act, 1994. On April 14, I said no to
undue delays in reducing unemployment insurance premiums.
I also questioned statements by the Minister of Finance about
potential savings to businesses, savings that could be reinvested
to hire workers.
It is in that context that I will address today clause 26 of the
bill.
The philosophy behind clause 26 of Bill C-17 is simple. It
rests on the principle that, assuming the Minister of Finance's
forecasts are realistic, the businesses would actually reinvest in
job creation the amounts they have saved as a result of premium
reductions. There you go, jobs are automatically created!
If this scenario is likely, and that is what we are given to
understand, then the next logical step is to ask ourselves why the
same government that has come up with this scenario almost
simultaneously increased contributions to the plan. On the one
4564
hand, it tells us that premium reductions will undoubtedly result
in job creation and, on the other, it increases contributions. The
logic behind this line of action eludes us.
This government expects 40,000 news jobs will be created as
a result of its new policy concerning UI premiums. Let us take a
closer look, if you will.
Based on the government's own calculations, 9,000 jobs were
lost as a direct result of the UI premium rate increase that came
into effect on January 1.
In the context of the present scenario, rolling back the UI
premium rates starting January 1, 1995, would prevent the loss
of another 31,000 jobs slated to disappear like those that were
lost last January. If you add these 9,000 jobs to those that will be
lost come January 1, 1995, the grand total is indeed 40,000. And
that is what they call a ``40,000 job job-creation program''. In
terms of creativity, we have seen better, but not in terms of
demagogy.
The main question that comes to mind of course is: Why not
have acted earlier? Or to put it another way: Why did the
government, knowing that a premium increase would inevitably
eliminate jobs, go ahead with this increase?
We do not understand and we are convinced that many
Quebecers and Canadians are asking the same questions we are.
Will the 9,000 people who lost their jobs last January because
of the premium hike be impressed by the glorified job creation
program announcements? Of course not! How will the
government explain its inaction to these workers? How will it
explain that the jobs they lost will be re-created a year later?
How will it explain to these people that it preferred to wait for
one year before taking action, when the enormous personal
sacrifices made by those who lost their jobs were totally
unnecessary and unjustified? Will it blame these injustices on
the Official Opposition, the source of all evils? Maybe. We have
seen such demagogy before in this chamber.
The Official Opposition has vigorously denounced the
February 22 budget since it was tabled in this House. We
denounced the inequity of the lower benefits and the longer
qualifying periods for the unemployed. We denounced the
budget's inequity to some regions, especially Quebec and the
Maritime provinces. We denounced the odious impact on
women of budget measures that control their private lives. We
denounced the disincentive and despair that these measures will
create for young unemployed people at the beginning of their
working lives.
(1250)
The Official Opposition denounced the lack of vision of this
so-called ``new'' government. We have noticed and deplored
the lack of real job creation policies and we will continue to do
so, Mr. Speaker, until the government stops oppressing the poor
and protecting the rich. We will continue to press for the
creation of real jobs, new jobs, even if we are blamed for all the
problems in the world.
I am speaking today in favour of the proposal to amend clause
26 of Bill C-17 put forward by my colleague from
Kamouraska-Rivière-du-Loup. The proposed amendment is a
very concrete solution aimed at eliminating one of the irritants
created by the February 22 budget. This proposal is also
designed to facilitate, albeit in a very minor way, job creation.
The Official Opposition is thus trying to repair the damage done
by the government.
We must support a motion such as the one we are proposing
today to ensure that jobs are created as soon as possible. To do
so, we must reduce premiums as early as June 1, 1994 while
waiting for concrete, real job-creation policies.
Mr. Pierre Brien (Témiscamingue): Mr. Speaker, before
discussing the issue as such and the amendments tabled by some
members, I want to reply to the comments made earlier by the
hon. member for St. Boniface. The hon. member criticized the
Bloc Quebecois on a number of issues and, on several occasions,
he made comments which were quite inaccurate. I want to state
the facts and also look at the real intentions of the government,
in the light of the member's remarks.
He said that the Bloc is inconsistent since it is asking the
government to cut spending, while opposing the fact that the UI
budget will be reduced by several billion over the next few
years. Yet, there is no contradiction there. It is possible to cut
expenditures, but the government must certainly not start with
cuts which will adversely affect the unemployed. The hon.
member is telling us that, as regards spending reduction, the
only significant measure in the budget, of which this bill is the
result, is major cuts to the unemployment insurance program.
The hon. member said that the opposition lacked vision,
adding that the problem was not new. He must know what he is
talking about since he sat on this side of the House for a quite a
while. I remember that at the time he and several of his
colleagues, including the current Deputy Prime Minister, used
to vigorously denounce the UI reforms of the Conservatives. It
is rather amusing to read the speeches made then by those
people. They were talking about inhuman measures and other
similar things.
Yet, only four months after they took office, and after
claiming in many cases that it was impossible to implement
quick reforms because these things require in-depth reviews
and a long term approach through committees which have to
work for a year or two before changes can be made, the
government was more than ready in the case of the UI program.
And this only 18 months after the Liberals vehemently opposed
the idea of targeting UI to fight the deficit at the expense of the
unem-
4565
ployed. Yet, four months after they came to office, the Liberals
launched an all-out attack on the jobless.
This is where they will go and get a good chunk of the money
they need to reduce the deficit in a very small way, as they said
in the last budget.
The hon. member then went on to say that we live in the best
country in the world and that our quality of life is second to
none. He referred to a UN study, to the umpteenth version of a
study that is published every year and whose findings were
released during the weekend. According to the study, Canada
ranked first for the second time in three years, and he was very
proud of all that. Of course, he forgot to mention that the study
does not consider debt levels in its ranking.
However, the report did say there was some concern about the
future, because considering the debt, many programs may not be
possible to maintain, at least not as they are now. There are a
number of criteria in this study which are debatable, including
the number of tv sets per household, and so forth. This is quality
of life evaluated in North American terms. It is no coincidence
that a country like Canada comes out well in this study. Criteria
and values are ours, and they form the basis for the judgment
made by the study.
If the debt were included as a criterion, I think there would be
a little less enthusiasm, and I think the hon. member would be
the first person to acknowledge this. Fine, we can say our quality
of life is very good, but if next month I were to use up all my
credit, my credit cards and my bank loans, of course I would
have an excellent quality of life during that month. But I could
hardly say the same for the months after that. I might have a few
problems then, although for a while I would have a very good
quality of life. Well, it would be a quality of life on credit.
(1255)
He also referred to Canada as the most decentralized country
in the world. I must admit I found it hard to keep a straight face.
The hon. member must know a couple of countries. In any case, I
will mention two he should look at a little more closely.
Certainly Belgium, where the federal level is responsible only
for foreign affairs, international trade and currency. And even in
the case of foreign affairs, two of the three levels have certain
powers. I wonder how he drew the conclusion that he did. I
suggest he take a course in international politics and take a close
look at the Belgian model.
He could also look at Switzerland to see how the system in
that country works. He would realize that they are somewhat
more decentralized than we are here.
He also talked a long time about the duplication that exists
between Quebec and Ottawa. As a member I get terribly
frustrated when someone comes to my office and wants to apply
for a training program, and they tell him he is not eligible
because he is not on unemployment insurance. The program is
open only to unemployment insurance recipients. If he is on
welfare, he has to apply for a different program, because he is
not eligible for this one. And then these people say: ``But how
come we have these criteria, because after all it is public money,
and we want the training''. And again they are told this program
is not for them and that they have to go to the other level of
government, which is responsible in their case.
What we have here is a lack of vision and a lack of
consistency. The hon. member for St. Boniface knows this. And
what have they done about it since they came to power? Nothing.
It is easy to see. He says that we made ``no concrete
suggestion''. We have been telling him for a long time that there
were concrete measures to be taken in the area of manpower
training. It is a very concrete suggestion and I am convinced that
he sees people like that every day or so in his office. I know I do.
Let us talk about what is being proposed now. They are
attacking the present unemployment system in many ways. They
are changing the number of weeks, the benefit rate and the rules
of eligibility. Since they cannot control unemployment itself,
they will at least control the number of unemployed people and
the way they will receive benefits. They are attacking the
unemployed themselves. That is where they put the focus in
order to solve the problem, despite the way they talked about
employment all through the campaign. They say: ``We will
decrease unemployment expenditures'' but they will not do so
by creating jobs; instead, they will modify the plan and make it
more stringent by increasing the number of weeks required and
decreasing the importance of criteria such as regional
unemployment, by increasing the number of weeks of insurable
employment from 10 to 12 and decreasing the rate of benefits
from 57 per cent to 55 per cent. For some the rate will increase to
60 per cent, but for most it will go from 57 to 55 per cent. They
talk very little about that.
Who will be affected most by such a reform in the area of
eligibility, expenditures, etc.? We can say that the Atlantic
provinces and Quebec will be hard hit. We heard figures like 630
million dollars in the Atlantic region, 735 million in Quebec,
560 million in Ontario and 430 million in the west. You know the
Maritimes will be the hardest hit.
Following the comments of my colleague for
Saint-Hyacinthe, the subcommittee on finance worked very
hard and saw to it that witnesses were heard. It was disrespectful
toward several of the groups that came to express their views
and their fears, particularly about the UI reform aspect of Bill
C-17. This was the case for the Acadian community, whose
presentation was cut short and whose members were thrown
out. It did not even take the time to listen to them. For a
government which stressed the importance of dignity and
openness, it showed blatant disrespect. Showing dignity is also
listening to people and letting them speak even if their visions or
views are different from our own. The committee did not even
bother to do
4566
that. This is quite astonishing, considering that that group had
for the most part supported the elected party.
In the few minutes I have left, I would like to ponder what will
happen now in view of these facts. What will happen if the
system is made stricter, or the entitlement period shorter? What
if beneficiaries still do not have a job at the end of their
entitlement period, since nothing would lead us to believe that
they will easily find one. They will simply have to become
welfare recipients.
(1300)
Then, which level of government will take them over? The
provincial level. Another level of government will pay the bill.
They are not in our records any more and they do not produce
any red ink here. They are now in the records of the provinces
which may end up with a tab of $100 million.
Researchers from the Université du Québec à Montréal,
economist Pierre Fortin and his group, have estimated at almost
$600 million the liability thus transferred to the provinces.
Therefore, we are passing the buck and telling the provinces:
``Make the choices that we refuse to make'', notwithstanding the
fact that their budgets are much smaller.
Here we have a budget of $160 billion, when in Quebec it is
less than $50 billion, that is less than a third. We are telling
them: ``You have more imagination, do the cuts we refuse to
make''. This is a terrible thing to do. Who are the losers in all
that? They are the individuals under attack and given little hope.
They are the consumers who just lost their jobs, that are often in
very difficult economic situations, and to whom we say that they
cost us too much and that they are responsible for the deficit. We
find that unacceptable.
This is why several of my colleagues have proposed
interesting amendments aimed at preserving an efficient enough
system, given that we are presently studying an in-depth reform
of social programs. I believe that what we have in front of us is a
major piece of legislation, and I call on my colleagues to support
the proposed amendments.
Mr. Jean H. Leroux (Shefford): Mr. Speaker, on October 25
last, the Canadian people elected a new government. In Quebec,
we were in the advantageous position of having the choice
between three political parties. Quebecers chose to send Bloc
Quebecois members to Ottawa. On October 25 last, the
objective, the campaign slogan of the Liberal government was
hope. All over Quebec, we heard ``Votez libéral pour l'espoir''.
Whenever I heard that slogan I thought that it did not make
much sense, especially knowing the government's background.
The Liberal government is to be blamed for most of the
Canadian deficit. All the Conservatives did afterwards was to
increase it. The Conservative government, which was in power
in the 1980s and early 1990s, increasingly curtailed citizens'
rights and now with Bill C-17, this government of ours is going
even further.
Since his election as leader of his party and the last campaign,
the Prime Minister is forever talking about bread and butter. We
now know that those are mere words. What the Prime Minister
and his cabinet are doing by amending the Unemployment
Insurance Act, is to take away a little bit more bread and butter
from the poorest members of our society. I rise today to
denounce the irresponsible attitude of a government which is
supposed to help economic recovery. A government which is
supposed to make Canadians and Quebecers feel better. But
what it is doing instead is taking a little bit more from
everybody.
The Liberals are hitting the poorest members of our society,
those who are the most in need. Losing your job is very sad. Mr.
Speaker, you and I are in an advantageous situation. We are
elected to serve for a certain period of time during which we do
not need to look for a job. You know as well as I do that losing
one's job is perhaps one of the saddest thing with which a person
must contend.
(1305)
All our government is doing is merely lowering the benefit
rate. People who once were entitled to 57 per cent of their salary
will now only be able to collect up to 55 per cent. Minor
adjustments have been made, but if we look at the figures, we
quickly see that two thirds of recipients will receive fewer
benefits than before. This is unacceptable. When a government
is given a mandate to govern, it must begin by focusing on the
least fortunate members of our society. That is not what this
government is currently doing. It is trying to reduce its deficit at
the expense of the most disadvantaged and that is unacceptable.
The Liberals have always adopted the liberal attitude whereby
the sky is the limit. Today, there no longer appears to be any
limit at all, and as a result, the least fortunate are becoming
increasingly dependant. What is this government doing? It is
lowering UI benefits and, as of result of its actions, provinces
will have to pick up a bigger share of the tab for social
assistance. Once again, this government is offloading its deficit
onto the provinces. This is unacceptable.
4567
As representatives of the people, we have a role to play. We
must ensure that all Canadian citizens are treated equally.
Parliament must also strive to narrow the inequity gap between
the classes. With Bill C-17, the Liberal government is making
the gap between rich and poor grow wider and wider. We, in the
Bloc Quebecois, cannot accept that. We were elected, Mr.
Speaker, you, I and all the hon. members, to protect the interests
of the people and, in this case, it would be in the interest of the
people to at least maintain UI benefits at the 57 per cent level.
This rate cannot be reduced.
The Canadian government seems to be strongly influenced by
the United States, where the rate is approximately 50 per cent.
But we have always had a slightly higher rate in Canada and
Quebec. This government did praise the merits of
unemployment insurance. The benefit rate has always been
slightly higher in Canada and Quebec and I think it cannot go
any lower. Let us not loose sight of those of our constituents who
are poor. We have in our ridings less fortunate people who do not
have enough to get by. The government has the duty-and the
duty of Parliament is to support a government that does so-to
do its job and be actively involved in creating employment. But
it is not the case here. This government talks about doing many
things. It plans to do this, that and the other, but actually does
very little. This government has accomplished very little.
As you know, the rate of unemployment in Quebec is about 13
per cent. In Canada, it is around 11 per cent. Some 450,000
Quebecers are presently unemployed, not to mention those who
lost their jobs but gave up looking for a new one because there
are none available. It is well know that the fishing, forest, tourist
and construction industries are seriously affected by the
measures contained in Bill C-17. Workers will be required to
work 12 weeks to qualify for unemployment insurance. There is
a danger that these people will not be able to meet the 12-week
requirement and will be forced to request social assistance.
(1310)
It is humiliating for someone who wants to work to be on
welfare. To wrap up, I think that the unemployment insurance
reform reflects the contempt of the Liberals for the unemployed.
The Minister of Human Resources Development admits to
pursuing the following objective: to force recipients to work
longer in order to qualify for the same number of weeks of
benefits.
The unemployed in Quebec and Canada did not choose to be
out of work and I think the government must do the best it can to
help them out.
Mr. Gilbert Fillion (Chicoutimi): Mr. Speaker, thank you
for giving me the opportunity to speak to Bill C-17 and
especially to the UI provisions on which my party has put
forward a few amendments that are, I think, in the interest of
Canadians.
I do not want to repeat the arguments made since this debate
started but I would still like to express my opinion on the use of
public funds to create jobs. Of course, whenever we talk about
unemployment, we also talk about job creation.
Every member of this House can now find out in his or her
riding the true extent of the infrastructure program announced
by this government, which will turn into a disaster in coming
days when municipalities will have to present their ratepayers
with borrowing by-laws in order to have access to the
infrastructure program. Let us look at what is now happening in
our ridings. Many of these projects will not be accepted because
municipalities are already deeply in debt.
We said at the time that it was another way for the Liberal
government to offload money it does not have onto provincial,
then municipal governments. In recent weeks, I also analyzed
what was being said and mostly listened to groups of young
people between 18 and 30 years of age that I would divide into
three categories: those who have jobs, young poorly-paid
workers without contracts but who still manage to get by on their
salaries for one, two or three years.
These workers still manage to get by. However, when their
contracts expire, they will fall into another category, that of
workers whose status is precarious and that is where it starts.
That is where it starts and when unemployment insurance
comes into play. For workers whose status is insecure, there are
only projects, jobs created under DEP or the Challenge program
or something like that, which under this bill would give these
workers lower benefits, because the rate is lower, after they had
accumulated a certain number of weeks of unemployment
insurance credits.
If you are lucky in that game and are back on UI, perhaps you
will be lucky again and find another project, but there will be no
third project. At that point, the insecure worker falls into the
unemployed category and that is my main point.
(1315)
We have nothing to offer our jobless young people who are 18
to 30 years old; we are losing that whole generation because we
have nothing for them. We are taking away their dignity and
forcing them for a few hundred dollars a month to take
compulsory courses in school again, which will be no use in the
end, since the training they will be given does not prepare them
for the jobs now vacant.
4568
You can be sure that young people in that situation-because I
know, I worked with them for over thirty years-develop a
certain fatalistic attitude which often makes them drink more
alcohol and also take more drugs; not having anything to do,
they find something to occupy their time.
The suicide rate is very high. Not a day goes by that we do not
see lack of work as the main cause of suicide among young
people aged 18 to 30. Of course they cannot afford to borrow, but
sometimes they have to and the interest rates they pay are
abnormally high. So they are caught in a trap from which they
will have difficulty escaping.
We devalue them. These people are socially devalued. We are
creating instability for a whole generation. If they are lucky,
they move in coop or low-cost housing units which, when not
supervised or when provincial governments make budget cuts,
often look like poverty ghettos. This is where our 18 to 30-year-
olds live.
They also share dwellings, which is not a healthy solution. If
they are lucky and do not belong to a single parent family, they
will go back to their parents' home, which is often the only
solution for many of them. This what you are creating by not
being able to come up with projects which will put people to
work and give them back their dignity. The stress and anxiety
related to the fear of not being able to find a job is very real for
these young people.
I also want to discuss the third amendment proposed by my
colleague regarding the approval of the House of Commons
given by resolution of that House, instead of the approval of the
Governor in Council. The Bloc Quebecois is not opposed to pilot
projects. This is important and I think it gives satisfaction to the
hon. member for St. Boniface. Again, we are not opposed to
pilot projects. In fact, we supported the one related to Operation
Dignity II.
We cannot oppose, and that is showing a constructive
approach, the implementation of new ideas. However, we want
the ministers, even though they are subjected to ministerial
accountability, to allow this House to review, examine, evaluate
and monitor each pilot project, since Parliament is the centre of
democracy and since elected representatives are accountable.
They must ensure government transparency, so that they are
not stuck with a fait accompli, as in the case of Pearson Airport
and all the dealings that went on with lobbyists. Once a debate
has taken place on a pilot project, the ministers are in a position
to evaluate the pros and cons. This enables them, and us as well,
to make better decisions. Then, the same information can be
transmitted to every Canadian.
(1320)
It is in this spirit that I will support the three proposed
amendments.
[English]
Mr. Ray Speaker (Lethbridge): Mr. Speaker, it gives me
pleasure to enter into this debate on Bill C-17, the budget
implementation act.
I was very pleased to attend all of the hearings with regard to
this bill at the committee stage. At that stage there were some
interesting presentations from those who wanted greater
benefits in terms of the unemployment insurance portion of the
act which in this omnibus presentation before us and those who
wanted to have the legislation concerning unemployment
insurance more on an insurance basis so that the books would be
more balanced and there would be less government intervention.
I would like talk about what I heard at those hearings. I want
to make sure that those ideas are presented in this assembly.
The Reform Party, as my colleague mentioned earlier, is in
support of the section concerning the unemployment insurance
changes. We support it for two basic reasons. First, we believe
there is a reduction in cost to business. Business across this
nation at the present time is under stress. We believe that the
reduction of cost can enhance employment opportunity for
many people in the working world.
Second, we believe that this amendment brings us closer to
the insurance principle whereby payments by the employer and
the employee will be equal to benefits that are derived
therefrom.
One suggestion made by a number of the groups is that we
should have more input by the employer and the employees with
regard to unemployment insurance. At the present time there is a
feeling that government has too much say as to how the program
is run. It was suggested that we should change the legislation
even more extensively than the legislation before us now to a
point where the government is one step removed.
I asked in that debate what would be the role of government.
The suggestion was that the role of government would be a sort
of funding agency that could play a part when there were surges.
In other words, if there was a surplus of funds in the
unemployment insurance fund, they could be the retainer of
those funds but when there is a demand on funds the government
would have this revolving fund available so that funds could be
put into unemployment insurance and there would be moneys
available at times of need.
That is a principle that we should consider here. I think it
would put the unemployment insurance fund on a basis whereby
it stands on its own merits and on its own financial support
system.
4569
We had some concerns regarding this Bill C-17 relative to the
section on unemployment insurance. First, there was the
question as to whether it should be a change in legislation just to
reduce the deficit. As reformers we certainly support any kind of
measures that go to reducing the deficit. If that were its only
purpose we would feel that supporting this amendment would
not be the right thing to do.
The second item that raised some concern with us was with
regard to the item which we call the two tier system whereby
there is the possibility of a means test for certain persons who
qualify for unemployment insurance. I would think in principle
it is not right that we have a two tier system. When a person pays
into an insurance program, whether that person is single,
married or whatever the status may be, that person should
qualify for a certain level of benefits. To enter this other
dimension into the system and at that time raise the question as
to a person's other means I think is wrong. I certainly would not
be in support of that area in this piece of legislation.
(1325)
The third area that concerns us is the fact that this legislation
was brought in with the budget. It was implemented with the
budget. Following that the government announced a very
comprehensive review of social programs. In a sense
unemployment insurance is an integral part. To approve
legislation in this assembly separate from this comprehensive
review I do not think is right. It certainly raises a concern with us
on this side of the House.
Fourth is with regard to the pilot projects. As a reform party
we are not against any kind of pilot projects where we can
experiment, look at efficiency or bring about avenues by which
we can better allocate and expend public funds. However, the
questions that are unanswered are the ones we are concerned
about. What really qualifies as a pilot project? Who will be
involved in these pilot projects? Will they be persons who are
really skilled and have expertise in the area? Are we looking at
some type of pilot projects that will satisfy some political
friends? I hope not.
The other question is what is it that we are really trying to
discover? What do we want to achieve through the pilot
projects? Is it another means by which we are evading the real
question before us? That question is certainly dealing with the
unemployed of this country. Are we trying to do things just to
pacify the general public by putting in place a pilot project
which in a sense is a delay tactic that is often used by
government in trying to avoid the main question that is before
us?
To resolve and deal with these problems, certainly the one
about unemployment insurance, we have to deal with the
primary question. The primary question as we all know is what
do we do about government spending? What actions must we
take to encourage growth in the economy? The primary question
is what actions must be taken. We feel and have said very
clearly in this House that one thing that must be clear to the
public and the investment community in Canada is that the
government does have a deficit reduction program.
The presentation of the budget, this budget implementation
act and other actions of the government to this time do not
indicate to the investment community, the business community
or the private individual community that the government has
come to grips with its spending. When we do and confidence is
in this nation and the economy grows then jobs will be available
and the concerns we have heard with regard to unemployment
insurance will certainly not be there. They will be set as a side
agenda very low on the priority not only of this House but of
Canadians.
I feel the solution lies in that area. However, in terms of the
unemployment insurance program we must remember that
program is not a welfare program. It is not a program by which
people can live for months and months on unemployment
insurance. It is a program that provides interim assistance
between one job and the next job opportunity.
As I listen to the Bloc Quebecois make its presentation in this
assembly I become concerned when it says benefits must be
extended extensively. What I hear in its message is that it wants
the benefits to be just about welfare benefits, not benefits on an
interim or temporary basis for those who are between jobs. If we
move to a point at which it becomes a program of longer term
financial security then we have moved away from the insurance
principle about which I spoke in the early part of my remarks
and that would be wrong.
(1330)
The Deputy Speaker: Is the House ready for the question?
Some hon. members: Question.
The Deputy Speaker: The question is on Motion No. 23. Is it
the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
Some hon. members: No.
The Deputy Speaker: All those in favour of the motion will
please say yea.
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
Some hon. members: Nay.
The Deputy Speaker: In my opinion the nays have it.
And more than five members having risen:
The Deputy Speaker: Pursuant to Standing Order 76(8), a
recorded division on the proposed motion stands deferred. This
will also apply to Motions Nos. 27, 28, 29, 30, 32, 34, 35, 36, 37
and 38.
4570
[Translation]
The House will now proceed to the taking of the deferred
divisions on the report stage of the bill now before the House.
Call in the members.
And the division bells having rung:
The Deputy Speaker: Pursuant to Standing Order 45(5)(a),
the whip of the Official Opposition has asked me to defer the
vote until later this day.
[English]
Accordingly, pursuant to Standing Order 45(5)(a), the
division on the question now before the House stands deferred
until later this day at 6.30 p.m., at which time the bells to call in
the members will be sounded for not more than 15 minutes.
* * *
[
Translation]
The House proceeded to the consideration of Bill S-2, an act
to implement a convention between Canada and the Republic of
Hungary, an agreement between Canada and the Federal
Republic of Nigeria, an agreement between Canada and the
Republic of Zimbabwe, a convention between Canada and the
Argentine Republic and a protocol between Canada and the
Kingdom of the Netherlands for the avoidance of double
taxation and the prevention of fiscal evasion with respect to
income taxes and to make related amendments to other acts, as
reported (without amendment) from a committee.
Hon. David Dingwall (for the Minister of Finance) moved
that the bill be concurred.
The Deputy Speaker: Is it the pleasure of the House to adopt
the said motion?
Some hon. members: Agreed.
Some hon. members: No.
The Deputy Speaker: All those in favour will please say yea.
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it.
Some hon. members: On division.
The Deputy Speaker: I declare the motion carried on
division.
(Motion agreed to.)
(1335)
[English]
Mr. Dingwall (for the Minister of Finance) moved that the
bill be read the third time and passed.
Mr. David Walker (Parliamentary Secretary to Minister of
Finance): Mr. Speaker, as the House knows, this is very
important legislation although it may appear to be housekeeping
to some. I would like to rise today to speak on this legislation
and to urge for its speedy approval.
This is not a bill to command great attention in the public
arena. Rather it represents some of the work-a-day measures
addressing tax fairness and good international and trade
relations that are a vital part of our endeavours on behalf of
Canadians.
The purpose of Bill S-2 is to implement reciprocal trade
treaties between our nation and Hungary, Nigeria, Argentina and
Zimbabwe, treaties that will eliminate double taxation on
income tax. As well, the bill implements the protocol to revise
the current tax convention between Canada and the Kingdom of
the Netherlands.
A tax treaty between countries is an important tool to provide
the benefit of certainty and stability regarding tax regimes,
benefits that concretely promote and facilitate international
trade and investment. Another benefit of such tax treaties is that
they also reduce annoyance in the operation of the national tax
systems involved in several ways.
First, they eliminate the necessity of paying tax on business
profits in the source country if there is no permanent
establishment in that country. As well, they provide a
mechanism to settle problems encountered by taxpayers.
More important, tax treaties eliminate or alleviate double
taxation in the instances where international transactions are
involved and may give rise to the same income being taxable in
the hands of the same person by more than one nation.
I should remind the House that the treaties enacted by this bill
are the latest within a longstanding process. The major reform of
Canada's income tax legislation in 1971 required Canada to
expand its network of double taxation conventions or tax
treaties with other countries. Since that time, negotiations for
the conclusion of new treaties or the revision of existing ones
have been entered into with almost 75 countries.
In this bill, the four tax conventions under review follow the
general pattern of the conventions previously approved by
Parliament. The number of Canadian tax treaties in force is
presently 52.
For the record, let me remind hon. members of the main
elements of the new treaties covered by the bill. These treaties
provide generally that dividends may be taxed in the source
country at a maximum rate of 15 per cent. However in the case of
intercompany dividends, the rate is often reduced if the
company receiving the dividends holds a certain equity interest
in the company paying the dividends. Such a reduced rate has
4571
been set at 10 per cent for the countries covered here, except for
Nigeria where it will be 12.5 per cent.
Regarding interest paid by a resident of one country to that of
another country, the rates set out in this bill are 10 per cent in the
case of Hungary, 12.5 per cent for Argentina and Nigeria and 15
per cent in the case of Zimbabwe. There are however some
exceptions.
Interest paid on a bond or a similar obligation of the national
government, a political subdivision or a local authority will be
exempt from tax in the country in which it arises. Also, these
treaties, except that with Zimbabwe, contain a certain provision
that will allow interest paid on loans or credits extended,
guaranteed or insured by certain state entities, in Canada for
example, the Export Development Corporation, to be taxable
only in the country where the recipient of the interest payment
resides.
(1340 )
These treaties also address the taxation of royalty payments.
They provide for a general rate of source taxation of 10 per cent
in the case of Hungary and Zimbabwe, 12.5 per cent in the case
of Nigeria and from 3 per cent to 15 per cent in the case of
Argentina, depending on the nature of the royalty. Copyright
royalties are exempt under the treaty with Hungary.
A number of other matters are dealt with in these tax treaties.
First, the treaty provisions dealing with capital gains reflect a
standard Canadian position enabling the source country to tax
gains arising on the sale of real property, business assets and
shares in the real estate companies.
Second, under the conventions, discrimination on the basis of
nationality is prohibited. This ensures nationals of one country
equal treatment with nationals of another country in the same
circumstances. However, this does not prevent a country from
providing fiscal incentives, for example, Canada's small
business deduction, on the basis of the residence of the taxpayer.
Third, Canada has also preserved its right to tax pensions paid
to residents of the countries covered by the bill. However, it is
important to point out, especially in light of the upcoming
D-Day anniversary, that war veterans pensions are generally
exempt from tax under the four treaties.
Fourth, the treaties provide that in Canada double taxation of
foreign source income of Canadian residents is alleviated by
way of a foreign tax credit, in accordance with the limitations
provided for in the Canadian legislation. Reciprocally, relief
from double taxation is granted in the other treaty country and in
accordance with the method recognized by that government.
Let me turn to a final undertaking enacted by this legislation.
Bill S-2 will implement a protocol to the tax convention signed
by Canada and the Kingdom of the Netherlands in 1986. This
updates the existing treaty to take into consideration changes
made to the respective laws and policies of the two countries.
For example, in 1992 Canada announced that it was prepared
in tax treaty negotiations to reciprocally reduce the withholding
tax rate on direct dividends. This was seen as a valuable
incentive to encourage international direct investment. In the
1993 budget, the government stated its willingness to enact
bilateral exemptions from withholding taxes on payments made
for the use of computer software. I am pleased to say that the
Netherlands is the first country with which we have completed
such an agreement.
Under this bill, in cases where a dividend recipient holds 25
per cent or more of the capital or 10 per cent or more of the
voting power of the dividend paying corporation, the
withholding tax will be reduced to 5 per cent from the current 10
per cent. This reduction will take place over a five-year period
starting from 1993. As regards interest payments, the protocol
reduces the rate to 10 per cent from the current 15 per cent.
As well, the agreement eliminates the withholding tax on
royalties for computer software and on interest paid to pension
plans.
In simple summary, the four tax conventions and the
Netherlands protocol contained in the bill provide some
equitable solutions to the various problems of double taxation
existing between Canada and certain international partners.
Each of these countries hopes to implement the bilateral
convention as soon as possible. Consequently I commend this
bill to the House and urge its speedy passage.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot): Mr. Speaker,
I welcome this opportunity to speak again, this time on third
reading of Bill S-2, a bill that deals with tax conventions
between Canada and Hungary, Nigeria, Zimbabwe, Argentina
and the Netherlands.
(1345)
I would like to take the next few minutes to repeat the reasons
for our objections to Bill S-2, that is to say, the objections of the
Bloc Quebecois. We do not object to these tax conventions
because we object to the countries as such. In other words, the
members of the Bloc Quebecois, Quebecers in general and
Canadians in general as well, on whose behalf we occasionally
speak as the Official Opposition, do not object to Hungary or
Nigeria or Zimbabwe or Argentina or the Netherlands.
4572
However, there are certain inconsistencies in the Canadian tax
system as well as in the rules and traditions of this tax system,
and we often find these inconsistencies in tax conventions of
this kind.
As you know, Mr. Speaker, we support free trade, and in fact
we were instrumental, and when I say we I am referring to
Quebecers, in adopting two international agreements. The first
one was with the United States and the second included Mexico.
We also supported arrangements to improve the rules of
international trade, like those that were adopted last December
at the GATT talks.
We also have a tradition of international co-operation and a
tradition of reaching out internationally. We remember Lester B.
Pearson, whom we admire for his international involvement,
and Jean Lesage in Quebec.
Therefore, it is not in that regard that the Bloc Quebecois has
to show its opposition in the case of international treaties. Tax
treaties are usually a good thing because they allow businesses
to avoid double taxation on the benefits of their various
affiliates.
Tax treaties also have the merit of creating reciprocal
agreements, which allows to draw a clear line between two
countries regarding taxation of the profits of companies,
because to be effective, those tax treaties must call for levels of
taxation that are roughly equivalent between two signatory
countries.
Besides, and this will be my first negative point in assessing
Bill S-2, as the auditor general mentioned several times, there
are flaws in the principle underlying tax treaties and in certain
agreements signed with countries that are considered as tax
havens.
In some of those countries, for instance Barbados, Cyprus,
Malta and Singapore, who have signed tax treaties with Canada,
corporate taxation and all that pertains to income or capital
gains taxation is much lower than Canadian taxation.
As the Auditor General underlined it in his 1992 report, no
corrective measure was adopted, even in the last budget of this
government, despite all that was said. According to the Auditor
General, incomes earned in countries that are tax havens and
that are designated by order may enter Canada tax free even if
they have not been taxed or have been at a very low rate.
The Auditor General also said in his 1992 report: ``The
Department of National Revenue Taxation is aware of a number
of taxpayers who have used this scheme-tax havens-to be in a
position to move $500 million into Canada tax free''.
This first point is already appalling enough. I must tell you
that, at the present time and since 1984, middle-income
taxpayers have been crippled by the Canadian tax system.
Incredible sacrifices are asked of the poorest in our society since
the last budget, while other taxpayers, probably those with very
high incomes, because they are the only ones who can take
advantage of those flaws, are allowed to move $500 million tax
free from foreign countries to Canada. I find this appalling.
(1350)
The second negative aspect regarding tax treaties is that the
foreign revenues of Canadian corporations, which are subject to
little or no tax, give the Canadian shareholders access to the
same federal tax credit on their dividends as on dividends payed
by a Canadian company which operates and pays taxes in
Canada. How can we speak of developing the Canadian
economy while this measure maintained by the tax treaties
hampers our economic growth and the development of Canadian
businesses?
Good Canadian corporate citizens which pay their taxes also
pay for other corporations which benefit from this type of
exchange, this type of deduction. And we are asked to quietly
support such a bill when tax treaties as a whole should probably
be reviewed to determine where are the tax havens and the tax
loopholes which allow bad corporate citizens not to pay their
fair share of taxes for years and years. I find it rather absurd that
we are asked to support this bill when all those treaties should be
reviewed.
The third negative aspect regarding tax treaties is that,
according to the existing legislation, a corporation operating in
Canada can deduct interest on the money it borrows to invest in a
foreign subsidiary. Companies that invest in tax havens have
found two ways to avoid paying taxes. First, they deduct their
loan interests and then they bring back to Canada, free of tax,
their profits which are subject to little or no tax in foreign
countries.
I am not the only one to say so. For about three years now, the
Auditor General has been saying that the tax conventions
legislation is full of holes. Let me quote the Auditor General on
this issue. It is always interesting to quote someone who is
non-political and neutral, someone who can put his fingers on
the problems linked to the Canadian tax system and the inaction
of the federal government which does not seem to want to do
much about the various loopholes. In his 1992 report, the
Auditor General said, and I quote: ``That deduction of interest
reduces Canada's tax revenue and, at the same time, the related
income is not necessarily subject to tax in Canada. It may be
received as a tax exempt dividend and may never appear in the
Canadian tax base''.
So, by using such tactics, Canadian companies can avoid
paying taxes first by transferring to the Canadian parent
corporation the losses incurred by their foreign affiliates. In
other words, the Canadian companies which report losses due to
their foreign production operations can deduct these losses in
Canada, which means that Canada is losing a similar amount of
money in tax revenues. Second, according to the tax treaties,
profits made by Canadian corporations can be redirected to
foreign countries. If profits are made here, in Canada, and
taxation levels are lower in the countries where the Canadian
parent company has a foreign affiliate, profits can be taxed in
the other country. Third, by using such tactics, Canadian
companies avoid paying taxes by converting their profits in
exempt income.
4573
One element of the Canadian tax system that needs to undergo
an in-depth review is all of the tax treaties and the legislation
concerning the Canadian tax conventions, because that is what
allows people who take advantage of all these loopholes to laugh
all the way to the bank.
Among the many examples I could use, I would like to quote
only one striking example the Auditor General gave us. I quote:
``A Netherlands Antilles subsidiary of a Canadian company had
assets of $865 million and income of $92 million. The offshore
income is not taxed on entering Canada, but it carries the federal
tax credit on dividends paid to Canadian shareholders''.
Imagine! That allowed the Canadian parent company to report a
$29 million tax loss in Canada. There was no production on
Canadian soil. No jobs were created. There was no investment in
machinery or equipment in Quebec or in Canada. The company
was engaged in a production activity in a foreign country
without creating economic activity either in Quebec or in
Canada, yet it was able to deduct from that foreign activity an
operating loss of no less than $29 million.
(1355)
If that is not exporting jobs and economic activity that are so
precious to us, I do not know how else to describe this flight of
capital.
The Auditor General gave us an idea of the costs related to
loopholes in the legislation governing tax treaties. According to
him, for 1990 only, Canadian businesses invested nearly $92
billion in non resident companies with which they have a
non-arm's length relationship; $92 billion, that represents
significant production activity exported elsewhere and
substantial tax exemptions for production activity exported
elsewhere. That also represents a lot of tax exemptions on
profits from economic activities not exercised on Canadian soil;
it amounted to $92 billion for 1990 alone.
Of course, some of this $92 billion has been invested by good
corporate citizens. There are companies doing real trading with
countries not considered as tax havens, but there are
nevertheless examples that can be drawn from the current
situation to show that some of these investments in countries
considered as tax havens are suspicious. Take for example the
investment of $5.2 billion made two years ago in companies in
Barbados, a recognized tax haven. These investments generated
$400 million in dividends which were tax exempt when received
on Canadian soil. As another example, $10.9 billion were
invested in companies in Cyprus, in Ireland, in Liberia, in the
Netherlands and in Switzerland, all countries also considered as
tax havens. These investments generated more than $200
million in dividends which were tax exempt once brought into
Canada.
According to the Auditor General himself-who does not
hold a membership card from the Bloc Quebecois, nor from the
Liberal Party, nor from the Reform Party-and I quote: ``It is
reasonable to conclude that hundreds of millions of dollars in
tax revenue have already been lost and will continue to be if
nothing is done to remedy the situation''. That was in 1992. The
Conservatives did nothing in 1992 and 1993. Then, in 1993,
there was a change of government, but to the same effect: the
Liberals have done nothing in the face of a tax scandal, a flight
of capital scandal, whereas Quebec and Canadian taxpayers are
being bled dry. This is unacceptable. It is a disgrace.
The Auditor General recommended a comprehensive review
of tax arrangements so that we can really determine which
countries we should have tax arrangements with, countries that
are not mere tax havens, and do not encourage massive capital
exodus as well as the loss of hundreds of millions in tax
revenues for Canada. This is not the time for such a waste of
money. On February 23, the Minister of Finance said that cuts
were in order. But instead of eliminating loopholes such as tax
arrangements, he targeted unemployment insurance.
I noticed your signal, Mr. Speaker.
The Speaker: I thank the hon. member. He will be able to
resume his remarks at three o'clock.
It being two o'clock, pursuant to Standing Order 30(5), the
House will now proceed to Statements by Members pursuant to
Standing Order 31.
_____________________________________________
4573
STATEMENTS BY MEMBERS
[
English]
Mrs. Georgette Sheridan (Saskatoon-Humboldt): Mr.
Speaker, last Friday over 500 people gathered in rural
Saskatchewan to mark the designation of Quill Lakes as an
international site in the western hemisphere shorebird reserve
network.
Prairie wetlands are vital habitat for shorebirds and
waterfowl. Prudent management of delicate ecosystems like the
Quill Lakes is crucial to the survival of many North American
migratory species.
The designation of Quill Lakes will help Canada meet its
international commitment as a signatory to the global
convention on biological diversity.
The Quill Lakes designation is an accomplishment in
partnerships. This project succeeded because of co-operation at
all levels of government, international, federal, provincial and
municipal. Experts, officials and local citizens co-operated to
safeguard this wetland area.
4574
There is good news. I am told that on Friday one keen-eyed
participant spotted a piping plover, one of the endangered
species that will benefit from the project.
* * *
[
Translation]
Mr. Michel Bellehumeur (Berthier-Montcalm): Mr.
Speaker, as the member for Berthier-Moncalm, I am proud to
rise today to salute Jacques Villeneuve's outstanding
performance in the Indianapolis 500.
At the age of only 23 and making his debut on the Indy circuit
this year, the son of the legendary Gilles Villeneuve
accomplished a real feat by finishing second in one of the most
prestigious car races.
Because Jacques Villeneuve shows so much determination at
the start of his career, I am convinced this second place finish is
only the beginning of a long series of successes and victories for
him.
* * *
[
English]
Mr. Bob Ringma (Nanaimo-Cowichan): Mr. Speaker, I
rise today to recognize the fourth anniversary which occurred
just last week of the democratic election in Myanmar or Burma.
Unfortunately we cannot celebrate this important date because a
repressive military regime has not allowed the democratically
elected government to take its rightful position.
Calls from the international community, including a petition
to the United Nations signed by the majority of members of this
House, have fallen on the deaf ears of the ruling junta.
The National League for Democracy won 80 per cent of the
seats four years ago, yet its leader remains under House arrest.
On this anniversary we once again call on the Burmese
military rulers to release the democratically elected Daw Aung
San Suu Kyi, or prime minister, in order that she may participate
fully in the shaping of Burma's future in accordance with the
will of the Burmese people.
* * *
Mr. Andy Scott (Fredericton-York-Sunbury): Mr.
Speaker, I congratulate the Muriel McQueen Fergusson
Foundation in Fredericton-York-Sunbury on the success of
its major fundraising luncheon last Wednesday. The foundation,
now nine years old, has the ultimate goal of eradicating family
violence in our communities.
Just a year and a half ago the foundation established the first
research centre on family violence in Canada. Working in
co-operation with the University of New Brunswick and
community organizations, the research centre's primary
objective is understanding the cyclical nature of family
violence.
Family violence is one of the most serious social problems
today. It underlies obstacles faced by youth, impacts the
workplace, undermines the economy, promotes substance abuse
and fosters violence outside the family. The list goes on.
I encourage members of the House and all Canadians to show
support for the agencies in their communities committed to the
elimination of family violence.
* * *
[
Translation]
Mr. Robert Bertrand (Pontiac-Gatineau-Labelle): Mr.
Speaker, on May 10 in Rimouski, Environment Canada
inaugurated the Weathercopy Service for the Eastern part of the
Lower St. Lawrence and the western part of the North Shore.
As a result, the authorities in charge of public safety and
emergency measures for these regions will receive weather
warnings and weather forecasts directly from Environment
Canada via radio transmitters and receivers, as soon as they are
issued by the meteorologists at Environment Canada.
According to public safety authorities, this information is
essential in order to take the necessary precautions in the event
of an emergency, provided there is a quick and reliable access.
Weathercopy is a new technology, a world first developed by
Dataradio Inc., a Canadian company. The development of this
technology was fully financed by the company itself. This is
another good example of co-operation between the public and
the private sectors.
* * *
(1405 )
[English]
Mr. Larry McCormick (Hastings-Frontenac-Lennox
and Addington): Mr. Speaker, with the consolidation of
military colleges in Quebec and British Columbia into one
operation based at Royal Military College, many staff and
students will be transferring to the greater Kingston area.
Contrary to the concerns that have been voiced by various
Quebec interests, let me say to the faculty, staff and students at
Royal Roads and collège militaire royal on their transfer to our
area that our residents are looking forward to the enriching
experience that these newcomers will bring to our communities.
4575
Therefore, on behalf of the residents of the townships of
Pittsburgh and Ernestown, I extend a warm hand of friendship,
welcome and understanding to future RMC students and staff.
Let me also give my assurance that Pittsburgh and Ernestown
townships will work together with RMC Base Kingston and
others to establish a community liaison to assist in making the
transition an enjoyable one for all concerned.
* * *
[
Translation]
Mrs. Madeleine Dalphond-Guiral (Laval-Centre): Mr.
Speaker, today is the first day of National Access Awareness
Week. While this government, as part of the proposals in the
Martin budget, prepares to enlarge, at its peril, the holes in our
social security net, the Official Opposition wishes to draw the
attention of this House to the fact that equality among all
individuals also applies to the right to work.
Like everyone else, the disabled have the right to work in an
environment that is considerate of their needs. The government
has a responsibility to assist their integration in the work place.
Today, we wish to pay tribute to the courage and perseverance of
these men and women and we say to them: Because your whole
life is an example that enriches our society, we promise that your
rights will always be respected.
* * *
[
English]
Mr. Randy White (Fraser Valley West): Mr. Speaker, I have
reviewed the details about a lady who was brutally beaten and
raped in 1987 in my riding. Wayne Alexander Perkin was
convicted of this terrible crime, given six years, and paroled
early.
Last week I sat with Corinne Schafer in her home as she talked
about her sister Angela's death. I attended court last Thursday to
hear the verdict on the same Wayne Perkin found guilty of
brutally murdering Corinne's sister Angela in 1992 while he was
out on parole.
I am sad for Corinne, her family and friends. I am frustrated at
a justice system that time after time has proven itself
ineffective. However, most of all I am angry at a government
that mimics its predecessors. The government has the power to
change many aspects of the justice system now, yet it continues
to drag its feet.
Canadians elected a government of Liberal ideals. I wonder if
they realize they were electing a government that is unable to
deal with reality.
* * *
Mr. Jerry Pickard (Essex-Kent): Mr. Speaker, Canada's
greatest resource is our youth. They are languishing with a high
unemployment rate of almost 20 per cent.
Parents such as I who have children in this age category are
very concerned about their future. The priority of the
government is to put the enthusiasm of these young minds and
bodies back to work.
New initiatives such as Youth Services Canada, the youth
internship program and the expansion of summer employment
programs are doing just that. Reforms to the Canada student
loans program and other learning initiatives will better train
young people for the jobs of the future.
In Essex county the conservation authority is sponsoring a
youth service pilot project. Approximately 16 participants will
work for nine months, gaining valuable experience and earning
credit to further their education and employment opportunities.
Through these initiatives the government is giving our youth
the necessary tools to build a prosperous future for themselves
and our country.
* * *
Mrs. Dianne Brushett (Cumberland-Colchester): Mr.
Speaker, I rise today to share information with my hon.
colleagues regarding the real value of ACOA, the Atlantic
Canada Opportunities Agency, to the four Atlantic provinces.
In Atlantic Canada ACOA partially funds or administers
many co-operative agreements, programs and projects. Often in
the past the public heard only of the failed projects. Today I wish
to share one of the many success stories with the House.
Earlier this month I had the pleasure of participating in a sod
turning to announce a $16 million expansion at Intertape
Polymer Group in Truro. The parent group of Polymer Group
contributed $14.6 million, while the federal and provincial
government through ACOA contributed $1.4 million to the total
project.
(1410)
This expansion creates 45 new jobs, for a total of 300 full
time, long term sustainable jobs. This is an international
company that can compete locally and globally-
The Speaker: The hon. member for Leeds-Grenville.
4576
Mr. Jim Jordan (Leeds-Grenville): Mr. Speaker, 50 years
ago on June 6, 1944 thousands of Canadians with their allies
stormed the beaches of Normandy in an exercise that became
known as D-Day. On the 50th anniversary of the beginning of
the downfall of the Nazi regime in Europe, Canadians will be
paying tribute to thousands of their fellow Canadians who took
part in the invasion.
I encourage all Canadians to take part in the upcoming D-Day
ceremonies in their respective communities so that the pride of
country and the great courage displayed by Canadians 50 years
ago are not allowed to fade from our memory.
* * *
[
Translation]
Mr. Jean H. Leroux (Shefford): Mr. Speaker, the Bloc
Quebecois wishes to congratulate the Government of Ontario
for having raised the level of the debate on Quebec sovereignty.
Ontario has devised a plan aimed at preserving the major
economic links between the two economies in the event of
Quebec accession to sovereignty.
The Ontario business community has put pressure on its
government to make sure that trade between the two entities is
maintained regardless of the political status of Quebec. Bilateral
trade between Quebec and Ontario accounts for more $48 billion
a year. Obviously, business circles have every reason to try to
protect these fruitful economic relations.
This calm and thoughtful reaction on the part of the
Government of Ontario is a pleasant change from the recent
thunderous and irresponsible statements by Premiers Harcourt
and Romanow.
* * *
[
English]
Mr. David Chatters (Athabasca): Mr. Speaker, I take this
opportunity to give special recognition to Alberta and
Saskatchewan farmers who this month are sending wheat flour
to the maritime families that are coping with the devastation of
the Atlantic fishery.
During the depression, Atlantic fishermen sent salted cod,
fruit, honey, clothing and other items to western farmers, trying
desperately to survive the devastation of their industry. The
grain these farmers are donating will produce 50,000 pounds of
flour, enough to make 95,000 loaves of bread. By donation the
flour will be shipped east and distributed to needy families
through the Newfoundland food bank.
It is wonderful to see grassroots Canadians pulling together in
a time of need, especially when their political leaders continue
to debate the future of Confederation.
* * *
Ms. Paddy Torsney (Burlington): Mr. Speaker, there has
been much excitement lately over the positions held by the Bloc
Quebecois on aboriginal self-government. It would seem that
there are several and that they are in conflict with one another.
Mr. Turp, president of the Bloc Quebecois policy
commission, has denied the statements he previously made and
published regarding aboriginal self-determination. Mr. Turp, an
international law scholar, now has no comment on the issue.
He is, however, quoted in the Vancouver Sun as saying that he
has taken a ``liberal and generous'' interpretation of the rights of
our aboriginal peoples. I believe liberal and generous are in line
with the Liberal government's approach toward aboriginal
issues. If indeed Mr. Turp's knowledge and research on the issue
are blocked by the Bloc, I would like him to know that his
liberalism and generosity in aboriginal affairs would certainly
be welcomed elsewhere.
* * *
[
Translation]
Mr. Ronald J. Duhamel (St. Boniface): Mr. Speaker, we
made it once more. Canada is first in the world according to a
United Nations report.
[English]
This report of the United Nations places Canada in terms of
human development in first place out of 173 countries. It
considers average income, life expectancy and educational
attainment.
[Translation]
Considering this enviable situation-the fact that we live in
the best country in the world-why should anyone want to
destroy it? Why not work together to improve even more the
situation of the men and women of Canada?
* * *
(1415)
[English]
Mr. Stan Keyes (Hamilton West): Mr. Speaker, I rise in the
House to relay my constituents' message that we stay focused on
the mandate we were given by them last October. We must not be
4577
sidetracked by all the counterproductive constitutional
fearmongering from members opposite.
Let us not forget that there are millions of people who are
unemployed in this country. Let us not forget that we have a
$460 billion national debt to reduce. Let us not forget that we
have a criminal justice system that is in need of serious reform.
Most important, let us not forget the strong message voters sent
to the previous administration.
We were elected to foster a sense of hope for the people of
Canada by providing them with good government. We were not
elected to sleepwalk into the abyss of the constitutional unity
debate.
* * *
Mr. Bill Blaikie (Winnipeg Transcona): Mr. Speaker, I
would like to express a concern of the NDP caucus, the Canadian
Labour Congress and others about discussions that are
apparently taking place within government about a project or
initiative called ``Waiving Compliance with Regulatory
Requirements''.
Many people are very concerned about extending more and
more discretion to ministers to waive compliance with certain
labour and environmental regulations with respect to certain
projects or applications by companies.
I call on the Minister of Human Resources Development and
others to scrap this project now. There is enough leeway in the
regulatory regimes now. We do not need any more deregulation
than we have had already.
_____________________________________________
4577
ORAL QUESTION PERIOD
[
Translation]
Hon. Lucien Bouchard (Leader of the Opposition): Mr.
Speaker, my question is for the Deputy Prime Minister.
Kingston city council recently passed a special resolution
blocking the construction of a French language high school on
an abandoned industrial site. The school would also have housed
a francophone community centre. You may recall that the
students of École Marie-Rivier have been attending classes for
the past seven years in cramped, makeshift structures without
washrooms.
Does the government intend to intervene directly to compel
Kingston city council to approve the construction of a French
school equipped with proper sanitation facilities?
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, it is unfortunate that the
Leader of the Opposition is travelling around the country these
days professing to be the great defender of francophone rights
outside Quebec. When the time came to authorize real
self-determination for Acadians outside Quebec, he and his
party voted against this proposal. Why? In his own words, to
punish those who voted against Charlottetown. The following
question then arises: Does the Leader of the Opposition truly
want to support student rights or is he merely interested in doing
some politicking to advance his own separatist goals?
Hon. Lucien Bouchard (Leader of the Opposition): Mr.
Speaker, I know the Deputy Prime Minister to be a polite,
courteous and honourable person. I know she will want to check
Hansard and the Votes and Proceedings of the House where she
will see that the Bloc Quebecois voted in favour of linguistic
equality for New Brunswick's Acadians. That is the truth. The
Deputy Prime Minister is repeating the gossip and false rumours
making the rounds. The Bloc Quebecois voted for equality-
The Speaker: Order! Order! I know that all members want to
hear the questions and answers during Question Period. The
Leader of the Opposition.
Mr. Bouchard: Thank you, Mr. Speaker. In any event, a check
of Hansard will settle this argument. I would like Hansard to be
verified immediately since I want Canadian citizens to be
informed at three o'clock that we stated the truth.
Does the government recognize that the decision of Kingston
city council is indicative of the kind of obstacles encountered by
francophones outside Quebec when they try to avail themselves
of their French language education rights? Getting back to the
issue that concerns us and to this blatant example of injustice,
can the Deputy Prime Minister tell us what steps she intends to
take in order to have this hateful decision reconsidered?
(1420)
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, if the Leader of the
Opposition were really interested in Kingston's francophone
students, he would have taken the time to learn the reasons why
city council decided to oppose the relocation of the school. The
proposed site was only steps away from a dangerous toxic waste
treatment site and Kingston city council did not want students
going to school there if their health would be endangered. The
decision had nothing to do with the fact that they were
francophones, but rather with the fact that the proposed location
was close to a toxic waste site.
Hon. Lucien Bouchard (Leader of the Opposition): Mr.
Speaker, I see that the Deputy Prime Minister supports this
decision and that far from distancing herself from it, she is even
justifying it, even though it will continue to deprive students at
4578
École secondaire Marie-Rivier of washrooms. Imagine, no
washrooms for students, in a country like Canada.
My question is for the minister of defence. In view of the
fierce opposition in the city of Kingston to the construction of a
school for francophones, will the minister of defence continue
to argue that Kingston is the best site for a bilingual military
college, one where francophones will feel comfortable?
[English]
Hon. David Michael Collenette (Minister of National
Defence and Minister of Veterans Affairs): Mr. Speaker, the
Deputy Prime Minister answered the substance of the hon.
member's question and I thought she did so very effectively.
With respect to the consolidation of the military colleges in
Kingston there will be no change to our decision. There will be
one military college that will be located at Kingston.
In fact I was in the area this morning talking with the local
press. I am really quite heartened by the attitude that the people
of that area have toward making Kingston a showplace of
bilingualism as a federal institution.
* * *
[
Translation]
Mr. Michel Gauthier (Roberval): Mr. Speaker, my question
is for the Deputy Prime Minister.
Despite appeals from the Government of Quebec, the
Kanesatake Band Council has continued the work to expand the
Indian cemetery. In a letter to his federal counterpart, the
Quebec Minister of Native Affairs, Mr. Sirros, asks the federal
government to begin negotiations quickly with the Kanesatake
Band Council.
As trustee, did the federal government intervene directly with
the Kanesatake Band Council to convince it to stop the work and
to return to the negotiating table or are we to understand instead
that Chief Jerry Peltier still refuses to return to the negotiating
table?
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, the federal government has
just appointed a negotiator in the person of lawyer Michel
Robert for the very purpose of negotiating an end to this
situation.
But on these issues, all sorts of opinions must be taken into
consideration, including Daniel Turp's; speaking on
self-determination for native people, he said to the Quebec
National Assembly: ``In my opinion, the fact that the natives are
a people, that they consider themselves to be a people gives
them a right to self-determination in the same way as Quebec''.
Of course, when we consider the issue of self-determination
for native people, we must consider not only the opinions of
negotiators in this context but also those of the Bloc Quebecois's
advisers.
Mr. Michel Gauthier (Roberval): Mr. Speaker, my second
question is still for the Deputy Prime Minister.
Can she tell us if the federal negotiator will make stopping the
work now going on in the pine grove a precondition for resuming
negotiations?
(1425)
Does the federal government agree that it must act quickly to
forestall any escalation in Oka? Does the federal government
agree on that?
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, obviously, when a
negotiator is appointed by the federal government, he has all he
needs to end this conflict. We want it to be settled generously,
equitably and fairly in the interests of all concerned. We have
confidence in the ability of lawyer Michel Robert and we await
results. We do not want to consider proceeding until we have
seen at least our negotiator's report.
* * *
[
English]
Mr. Jack Ramsay (Crowfoot): Mr. Speaker, my question is
for the Minister of Justice.
Larry Fisher, who served a 23-year sentence in prison for
raping seven women, was released from prison last Friday.
Fisher is now free to travel wherever he pleases without any
obligation to declare himself to local enforcement officials.
In an internal memorandum issued last week by the RCMP, it
warned that because of his past criminal history it is likely that
he will reoffend. So that people like Larry Fisher can be
identified by local law enforcement officials, will the Minister
of Justice include a national registry of sexual offenders in his
forthcoming package of judicial reforms?
Hon. Allan Rock (Minister of Justice and Attorney
General of Canada): Mr. Speaker, in response to the specific
question, it is not something that is planned at present but a
national register of sexual offenders is something I would be
happy to consider and discuss with the hon. member once I have
had an opportunity to examine its implications.
I will deal more broadly with the thrust of the member's
question without commenting on the case of Mr. Fisher who has
completed his sentence and has been released at the end of the
sentence which, by the way, was served without parole.
4579
Let me speak more generally about the whole question of the
release of offenders. As the hon. member will know, we have
long since identified as a matter requiring action the whole
question of the release of high risk offenders at the end of their
sentences of incarceration.
I have already started with my colleagues in the provinces and
territories an examination of alternatives. We have planned
meetings with the ministers of health of those jurisdictions later
this year to discuss specific changes to provincial mental health
legislation to permit assessment and, if public safety requires it,
continued confinement of such persons beyond the end of their
criminal sentence in order to protect society.
Mr. Jack Ramsay (Crowfoot): Mr. Speaker, I thank the
minister for his answer and his concern in this area.
Following in the same vein, it was recently reported that Easy
Street, a children's centre in Calgary, unwittingly hired a janitor
who had just been released from a 12-year sentence for sexually
abusing a seven-year old girl.
Calgary vocational services which helped the man get the job
said it knew of his criminal record but was bound by
confidentiality. This example shows that action is needed now.
Will the Minister of Justice include a national registry of child
abusers in his forthcoming package of judicial reforms?
Hon. Allan Rock (Minister of Justice and Attorney
General of Canada): Mr. Speaker, in concert with the Solicitor
General and the Minister of Health, we are releasing a
discussion paper on the whole question of a national child sex
abuse register for the protection of children to adapt existing
technology to permit us to store for retrieval in appropriate
circumstances particulars of convictions for sexual abuse.
Protection of children in cases such as the one referred to by the
hon. member is our paramount concern.
After we have the benefit of the views of Canadians including
the provincial authorities on the alternatives set out in our
discussion paper, we will put in place a national register with
respect to those convicted of child sexual abuse.
As I informed the House last week, our objective is to have
that in place in the fall of this year.
Mr. Jack Ramsay (Crowfoot): Mr. Speaker, again I thank the
minister for his response to these very urgent public matters.
On Saturday the Manitoba Teachers' Society endorsed a
resolution that would inform schools whenever they had a young
offender in their classes. Similar requests are likely from both
Alberta and Ontario in the next few weeks.
(1430)
Will the minister's forthcoming proposal include these
requests, namely that school officials be informed of young
offenders in their midst?
Hon. Allan Rock (Minister of Justice and Attorney
General of Canada): Mr. Speaker, I believe the changes we are
going to introduce in legislation to be tabled in the House will
meet those concerns.
I have engaged in discussions with chairs of school boards,
with representatives of schools, with police forces, with parents
groups. I am keenly aware of the strong feeling that where
public safety requires it, information about young offenders
should be shared, particularly in those cases involving crimes of
violence.
I am confident that the changes we will propose very shortly
to the House of Commons will meet those concerns and answer
the needs that have been identified by the hon. member.
* * *
[
Translation]
Mrs. Pauline Picard (Drummond): Mr. Speaker, my
question is for the Minister of Health. After excluding the
provinces from the National Forum on Health, the Minister of
Health may have to backtrack because last Friday in Calgary the
Prime Minister contradicted her by opening the door to the
provinces' participation in this forum.
Does the Minister of Health still refuse to ensure the
provinces' direct involvement in the national forum or will she
review her position after the Prime Minister said he was ready to
consider provincial participation in the forum?
Hon. Diane Marleau (Minister of Health): Mr. Speaker, let
me inform all members of this House that I have had and will
continue to have extensive discussions with my provincial
counterparts. I even had some again this morning.
Let me also inform you that several of the provinces have
already expressed their interest in participating in this important
forum. It must be said once again that the purpose of the forum is
to bring together health care experts to start a dialogue with
Canadians and advise the Prime Minister. It is not intended as a
decision-making forum replacing the meeting of provincial and
federal health ministers.
Mrs. Pauline Picard (Drummond): Mr. Speaker, my
supplementary question is this: Can the minister assure us that
the provinces will become full participants in the consultation
process which the National Forum on Health is, in addition to
the federal-provincial conferences planned for that purpose?
4580
[English]
Hon. Diane Marleau (Minister of Health): Mr. Speaker,
most of the provinces are very much in accord with what we are
doing concerning the national forum on health. We continue to
work with all the provinces to ensure their co-operation.
Let me be very clear here. We must not let intergovernmental
squabbling interfere with the real objectives of this forum which
is to look at the future of the health needs and health
requirements of all Canadians.
* * *
Mr. Grant Hill (Macleod): Mr. Speaker, my question is also
for the health minister.
The federal component of health care funding has dropped
and continues to drop. It is now in the neighbourhood of 22 per
cent of our health care spending.
Will the minister agree to open up the Canada Health Act to
bind the federal government to a specific percentage of health
care funding?
Hon. Diane Marleau (Minister of Health): Mr. Speaker, the
Canada Health Act does not specify any amounts in transfer
payments. That is done under EPF.
In the last nine years, there have been some decreases in
funding. However, the good news of the past budget was that we
maintained the funding of EPF health and we hope to continue to
do that with the co-operation of all.
(1435 )
Mr. Grant Hill (Macleod): Mr. Speaker, frankly, the answer
does not satisfy the Canadian public. The funds are dropping and
continue to drop as a percentage of health care funding.
Our party has been criticized for slashing and burning in
terms of social programs. Our party would cut theme parks in
Shawinigan, cut limousines to ministers, cut fancy health
programs for members of Parliament and cut pensions for
members of Parliament, to look after health care.
Will the minister put her money where her mouth is?
Hon. Diane Marleau (Minister of Health): Mr. Speaker, for
a party that is so generous when it comes to cutting, what
surprises me is that it is actually looking at establishing a two
tier system, on having extra billing.
This party is not for cash register medicine whether there is an
express lane or not.
* * *
[
Translation]
Mr. Pierre de Savoye (Portneuf): Mr. Speaker, my question
is for the Minister of Health. Responding to a question from the
opposition on the hepatitis C issue, the minister refused to take
action to identify and warn those who were infected, merely
suggesting that people see their doctor. The fact is however that
hepatitis C is often asymptomatic.
How can the minister responsible for public health refuse to
take action on the hepatitis C issue when several thousand
Canadians, unaware of their condition, can transmit the virus to
others and even die from it?
Hon. Diane Marleau (Minister of Health): Mr. Speaker, we
continue to strive to make the Canadian blood supply system
safe. But let me tell you that there are many partners in this
system. The role of Health Canada is to ensure that blood
products are as safe as possible.
As for the Canadian Red Cross Society, its role is to keep a
precise record of the blood products distributed. Hospitals also
have a major role to play, as well as physicians, who are
responsible for keeping their patients well informed.
For our part, we are examining our role as a regulating
authority to make sure that all these people work together to
ensure our blood supply system is the safest possible.
Mr. Pierre de Savoye (Portneuf): Mr. Speaker, since tens of
thousands of Canadians have already been infected, does the
minister agree that, by accepting to make arrangements
immediately to reach people who may have been infected, she
would not only improve their quality of life but also reduce
considerably the risk of hepatitis C spreading?
Hon. Diane Marleau (Minister of Health): Mr. Speaker, as I
just said, there are many partners involved in the blood supply
system. There are many partners in the health system, including
the provinces, who have a major role to play. I am really
surprised to see the Bloc Quebecois, which is so intent on
leaving this Confederation and making sure that we do not
infringe upon provincial jurisdictions, rise today and urge me to
tell the provinces what to do.
* * *
(1440)
[English]
Mr. Jim Abbott (Kootenay East): Mr. Speaker, my question
is for the Minister for International Trade.
4581
The minister was quoted recently as saying that perhaps the
dispute between Canada and the U.S. over softwood lumber
could be taken away from the present dispute settlement panel
procedures, which have ruled in Canada's favour in the past, and
moved into some broader based discussions that could lead to
resolution.
Can the minister ensure the Canadian softwood lumber
industry and all of the workers that this will be an improvement
particularly considering that Canada has won just about every
round in this ongoing dispute over the existing procedures?
Hon. Roy MacLaren (Minister for International Trade):
Mr. Speaker, we fully expect to win the next panel reviews.
There are two more during the months of June and July and we
expect to win them as well.
The point I had in mind was that it is always available to
United States' interests to retrigger, to reinstitute the whole
process for a fourth time. Surely it is in both our interest and the
United States' interest to proceed on a basis that does not once
again trigger this whole tiresome process.
Mr. Jim Abbott (Kootenay East): Mr. Speaker, I appreciate
the minister's answer.
I was wondering if the minister was thinking of trying to take
the dispute settlement that is currently being used against us,
where Canada is being harassed, and actually making it a
separate part, almost like an auto pact; in other words, taking the
softwood lumber out from under.
I can tell the minister that I had a discussion with
Congressman Sam Gibbons, a senior congressman, who thought
that was a good idea. Would the minister support that?
Hon. Roy MacLaren (Minister for International Trade): I
would be glad to hear in rather more detail what the hon.
member has in mind.
The point that we both share is that there is this possibility of
ongoing harassment, as the member puts it, and since both
industries, both sides of the border, are to a degree integrated
and share common environmental problems, common supply
problems, it must not be beyond our wit to come up with some
better solution to our difficulties than this constant recycling of
dispute settlement panels.
* * *
[
Translation]
Mr. Yves Rocheleau (Trois-Rivières): Mr. Speaker, as we
recently saw, the Minister of Industry totally distanced himself
from the election promise made by his party to transform the
defence industry productivity program into a conversion
instrument rather than a program supporting civilian technology
for military purposes.
My question is: Will the minister explain why DIPP, which
was not deemed adequate to facilitate industrial conversion
when the Liberal Party formed the opposition, is suddenly
perceived as an effective tool to facilitate the conversion of
military industries to civilian production?
Hon. John Manley (Minister of Industry): Mr. Speaker, I
thought the answers I provided to other Bloc Quebecois
members on that issue were quite clear. As mentioned in the red
book, DIPP will indeed be the basis of our conversion program
for military industries. Also, as I indicated, since we were
elected, 39 out of 41 proposals accepted by this government
concerned civilian projects or both military and civilian
production, and had nothing to do with DIPP.
I do not understand why the Bloc objects to the fact that, even
with a program such as DIPP, we can choose proposals related to
civilian purposes, and also objects to the commitment we made
to the effect that we could change some aspects of that program
to stop the wasting of money, by setting up a system which
would benefit from contributions made by companies. This is a
program for the conversion of military industries.
(1445)
Mr. Yves Rocheleau (Trois-Rivières): Mr. Speaker, I have a
supplementary. Does this mean that the Minister of Industry was
refused the financial resources required to implement a true
conversion strategy, which might explain why he is now
extolling the virtues of DIPP, which was so strongly criticized
by his party when it formed the opposition?
[English]
Hon. John Manley (Minister of Industry): Mr. Speaker, I
can only believe that the Bloc keeps repeating the same
ridiculous allegations in the hope that sooner or later people will
start to believe them.
What we have made clear is that there is a program of defence
conversion. Yes, DIPP needs to be expanded and yes, we need to
create a revolving fund, but fundamentally we made a key
promise when we went to the polls last October which was in
part to cut subsidies to business.
The Bloc keeps wanting us to write cheques to companies
which somehow or other were not aware that the Berlin wall
came down in 1989 and their shareholders are not willing to
invest enough now to give them a plan for the future. If that is
the kind of company the member wants us to give money to, I am
sorry I do not agree with him and the government does not agree
with him.
We are prepared to work on strategies for companies. We are
prepared to help them identify markets. We are prepared to work
with their managers and their shareholders. However it has to be
4582
a co-operative effort including all of the stakeholders in each
case, in each company.
* * *
Mr. Stan Keyes (Hamilton West): Mr. Speaker, my question
is for the parliamentary secretary responsible for fitness and
amateur sport.
The recent report of the core sport commissioner
recommended among other things the elimination of federal
funding for 19 amateur sport programs. Six of the targeted
programs are Olympic sports, two of which saw gold medal
performances for Canada from Myriam Bédard and Jean-Luc
Brassard at Lillehammer. The report also recommended cutting
funding to lacrosse which we in this House just declared
Canada's national summer sport.
Will my hon. colleague give this House her assurance that
these recommendations will never see the light of day?
Ms. Albina Guarnieri (Parliamentary Secretary to
Minister of Canadian Heritage): Mr. Speaker, the minister
remains a good sport when it comes to funding those sporting
activities which remain important to Canadians.
The minister has been unequivocal in his intent not to
discontinue funding to biathlon and to the Canadian Freestyle
Ski Association. Officials are currently reviewing the Cal Best
report. The minister intends to make his call on the core sport
concept before the end of the summer.
* * *
Mrs. Diane Ablonczy (Calgary North): Mr. Speaker, my
question is for the Minister of Human Resources Development.
The minister has assured this House that the Canada pension
plan is in good shape with a healthy surplus.
However, almost all the surplus, 93 per cent of it, is loaned out
to provinces at bargain basement interest rates. For example, it
has just been reported that a Saskatchewan crown corporation,
SaskTel, owes $100 million of its huge $600 million debt to the
Canada pension plan at below market rates.
How could cheap loans to debt ridden governments and crown
corporations be in the best interests of CPP contributors and
beneficiaries?
Hon. Lloyd Axworthy (Minister of Human Resources
Development and Minister of Western Economic
Diversification): Mr. Speaker, the hon. member may be
interested to know that this arrangement in terms of using
surpluses of CPP as a basis for provincial use has been in place
since the mid-1960s. It is not simply a program to lend to crown
corporations.
If the member would speak to some of her colleagues who
have been in provincial government she would know that the
provinces also provide guarantees on whatever loans that are
given to their agencies. Those are usually on a return interest of
about 11 per cent, as I understand it. In effect the process has
been in place for 30 years.
We are certainly glad the Reform party wants us to take a new
look at this co-operative arrangement with the provinces and do
something about it. Generally the program has worked very
well. It has been a very important source for all provincial
governments to invest in a wide variety of important
infrastructure and educational institutions in their provinces. It
is too bad the Reform party wants that program to come to an
end.
Mrs. Diane Ablonczy (Calgary North): Mr. Speaker, what
really is going on is that some of the provinces are funding some
of their activities with low interest federal money instead of
with tax dollars. They are getting further into debt because of it.
Also CPP premiums are now expected to rise to keep pace with
payments of benefits.
(1450)
Will the government agree to a moratorium on these low
interest loans and ensure that from now on CPP surplus funds
will be invested with an eye to a reasonable rate of return?
Hon. Lloyd Axworthy (Minister of Human Resources
Development and Minister of Western Economic
Diversification): Mr. Speaker, I will quote directly the auditor
general who says in his most recent report: ``The CPP fund earns
a reasonable rate of return on its investments''.
If the hon. member is not prepared to take my word for it,
perhaps she will take the word of the Auditor General. In the last
report he underlined the fact that CPP funds are in fact being
used for useful investments at a proper reasonable rate of return.
* * *
[
Translation]
Mrs. Christiane Gagnon (Quebec): Mr. Speaker, my
question is for the Minister of National Defence.
The third annual report of the Department of Defence
Advisory Council on Women in the Canadian Armed Forces
indicated that harassment is still quite frequent within this
organization. In an article published on May 21 in La Presse, it
was mentioned that the changes to the harassment policy of the
department included, among other things, a new complaint
process which is not controlled by the military hierarchy.
4583
Can the minister tell the House what concrete measures his
department took to fight sexual harassment?
[English]
Hon. David Michael Collenette (Minister of National
Defence and Minister of Veterans Affairs): Mr. Speaker, there
is no question that this has been underlined in a number of
reports by the human rights commissioner and others in recent
years. The armed forces is taking very strong steps to combat
discrimination and harassment of women in particular in the
armed forces.
In fact, this morning I was at a workshop in Gananoque of the
spouses of Canadian forces personnel. They are working as a
group within the department but also are volunteering their time
to educate others in the wider military community to make sure
this horrible trend of harassment in Canadian society does not
spread any further or certainly any deeper in the Canadian
military.
[Translation]
Mrs. Christiane Gagnon (Quebec): Mr. Speaker, is the
Minister of National Defence in a position to appraise the new
complaint process in use since last year and tell us how it was
perceived by the women in the Canadian Armed Forces?
[English]
Hon. David Michael Collenette (Minister of National
Defence and Minister of Veterans Affairs): Mr. Speaker, this
whole process is going quite well. I will make available to the
hon. member either privately, or by giving a statement in the
House or depositing a document at the table, all the measures we
have taken in the last year to address these very serious
problems.
* * *
Mr. Jim Gouk (Kootenay West-Revelstoke): My question
is for the Minister of Human Resources Development.
The lack of a chairman for the board of referees in Kootenay
West-Revelstoke has denied residents the right of appeal on
UIC problems. I raised the issue in the House with the Minister
of Human Resources Development on March 11 and was
promised speedy results. The latest word is nothing until at least
next fall.
Why is this relatively simple process taking so long? What
will the minister do to ensure the rights of the people in my
riding are not put off any longer?
Hon. Lloyd Axworthy (Minister of Human Resources
Development and Minister of Western Economic
Diversification): Mr. Speaker, the reason for taking our time is
that we want to make sure we get the best person possible in the
riding of Kootenay West-Revelstoke. It does take some time
for consultations, but I can promise him we will certainly have
an appointment in that post before the fall.
Mr. Jim Gouk (Kootenay West-Revelstoke): Mr. Speaker,
my supplemental is also for the Minister of Human Resources
Development. It is a repeat of the question I asked the minister's
parliamentary secretary on March 25, with no results.
Will the minister extend the term of the previous chairman,
Rocco Mastrobuono, until this drawn out process finally comes
to an end?
Hon. Lloyd Axworthy (Minister of Human Resources
Development and Minister of Western Economic
Diversification): Mr. Speaker, the hon. member's question to
the parliamentary secretary was very effectively and properly
answered. The government would like to make an appointment
as soon as possible, as soon as we find the proper person. I have
committed to the hon. member that we will look at his request
with special dispatch. There will be a new chairman of the board
of referees as soon as possible.
* * *
Mr. David Iftody (Provencher): Mr. Speaker, my question is
for the Minister of Industry concerning the finance department's
small business assistance report which was recently released.
The report attempts to allege that the banks have not created a
credit crunch for small businesses. This report blatantly
contradicts testimony to the industry committee presented by
Canadian small business people from all regions of the country.
(1455)
Who is telling the truth? Can the minister tell this House who
we should believe, finance bureaucrats or the Canadian business
people?
Hon. John Manley (Minister of Industry): Mr. Speaker, it is
an easy call to make.
I am not sure what methodology was used in that report which
was widely published last week. It was prepared for the previous
government.
My view is, and I have heard the views of business people
from across Canada as has the industry committee, that in fact
there is a problem getting adequate financing for small business.
The government has identified the small and medium sized
business community as the key factor in creating jobs. We have
been discussing with the banks a code of conduct for lending
practices which we hope we can agree to with them. A number of
banks admitted to the committee and other places that in fact
they were not doing as much as they could have done for the
small business community. We are looking to the banks to
respond to the challenge, particularly for knowledge based
4584
industry, particularly for the needs of small business to get
adequate funds to grow and expand. Those are the initiatives we
are pursuing.
Export oriented, knowledge based small business is the key to
Canada's future. We need the banks to be partners in ensuring
that is what happens.
* * *
[
Translation]
Mr. Benoît Sauvageau (Terrebonne): Mr. Speaker, my
question is for the Minister of the Environment.
Canada has not yet passed legislation to force ships sailing in
Canadian waters to have a double hull. So the risk of spills
causing considerable damage to the environment is still very
high. Because of the St. Lawrence Seaway, Quebec is directly
concerned by this absence of legislation. A chemical spill in our
river would be catastrophic for the environment and our
economy.
Can the minister, who announced on February 8 she would
table her action plan before April 1st, explain to this House the
delay of more than two months on an issue of such crucial
importance for coastal regions in Quebec and Canada?
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, the legislation on double
hulls was passed in 1993.
Mr. Benoît Sauvageau (Terrebonne): Mr. Speaker, if
legislation was passed in 1993, how can the minister explain
why it is taking her so long to implement a contingency plan in
case of spills while her colleague, the Minister of Transport,
plans to delay until the year 2015 the implementation of
regulations concerning the transportation of dangerous goods in
double hulled ships?
Hon. Sheila Copps (Deputy Prime Minister and Minister
of the Environment): Mr. Speaker, I repeat, there is no delay.
The double hull legislation was passed last year. I do not know
where the Bloc member and his colleagues were at that time, but
the legislation already exists.
* * *
[
English]
Mr. Jim Silye (Calgary Centre): Mr. Speaker, my question is
for the Minister of Justice. Among the rights listed in the
Charter of Rights and Freedoms as guaranteed to all Canadians
is the right to freedom of association, that is the right of
Canadian citizens to choose for themselves those individuals or
groups with whom they do or do not wish to associate.
Does the Minister of Justice support this right of freedom of
association?
Hon. Allan Rock (Minister of Justice and Attorney
General of Canada): Mr. Speaker, that is the sort of question
one would prefer to hear the supplementary to. Let me say
without qualification that subject to the supplementary, of
course I do.
Mr. Jim Silye (Calgary Centre): Mr. Speaker, I will accept
that waffle as a probable, yes.
In 1990 Norma Janzen of Langley, B.C., was fired from her
job teaching children with learning disabilities. She had refused
to join the B.C. Teachers' Federation fearing that a strike would
force her to abandon her students, something she did not want to
do.
This was a clear breach of Mrs. Janzen's right not to be forced
to associate with the union. Mrs. Janzen has had to file a lawsuit
to re-establish the freedom she has been denied.
Given the minister's response, will he instruct the Solicitor
General and the Minister of Human Resources Development to
seek intervener status in the case in support of Mrs. Janzen?
Hon. Herb Gray (Leader of the Government in the House
of Commons and Solicitor General of Canada): Mr. Speaker,
the hon. member has raised a matter which is of concern I am
sure to the constituent in question, but this is something which
falls completely under provincial jurisdiction. It is certainly
open to the individual in question to challenge the matter in the
courts and to seek the support of those who share her views, but I
do not think this is a matter for which the federal government
has a special role to play and certainly not the Solicitor General,
even though I understand the member's concern.
* * *
(1500)
[Translation]
Mr. Don Boudria (Glengarry-Prescott-Russell): Mr.
Speaker, my question is for the Minister for International Trade.
The minister is aware of the U.S. Secretary of Agriculture's
tirades claiming, once again and quite wrongly, that Canada
subsidizes grain exports.
Can the minister tell this House how successful our
government is in convincing the U.S. government of the validity
of our position?
[English]
Hon. Roy MacLaren (Minister for International Trade):
Mr. Speaker, the member may want to recall a number of
instances in which both the minister of agriculture and I have
made clear to the United States administration our complete
4585
disagreement with their allegation that Canadian grain exports
to the United States are subsidized.
We have taken every occasion to underline that basic position
to the United States administration, as recently as my visit to
Washington last week. We explored with the United States
administration how they came to make this contention. We have
agreed to meet with them further on this subject toward the end
of June.
However, as the hon. member will know, the United States has
imposed on itself a deadline of mid-July for a resolution of this
issue in one way or the other.
* * *
[
Translation]
Mr. Michel Gauthier (Roberval): Mr. Speaker, I have two
points of order. The first one concerns my political party.
During Question Period, the Deputy Prime Minister
mentioned that the Bloc Quebecois had voted in this House
against a motion to entrench the equality of both language
communities in New Brunswick.
According to the Votes and Proceedings of this House, Bloc
members voted for the motion, and their votes are duly
recorded; only the Reform Party, that is Miss Grey, and Mr.
Nowlan voted against it.
The Speaker: During Question Period and during debates, it
happens at times that members have a different interpretation of
events that are related. These are matters of debate, not points of
order. I hope that members will be more discriminate in their
choice of words and in what they say in the House.
This is not a point of order, it is a matter of debate. I am
willing to listen to the member's second point of order.
Mr. Michel Gauthier (Roberval): Mr. Speaker, my second
point of order is to the effect that, during Question Period, we all
clearly heard the Minister of Transport call the Leader of the
Opposition a liar, whereas what I just said proves beyond any
doubt that the Leader of the Opposition was absolutely right.
Mr. Speaker, not only was the Leader of the Opposition right,
but on top of that, the word ``liar'' is unparliamentary.
The Speaker: Order, please.
Has the hon. Minister of Transport something to say?
Hon. Douglas Young (Minister of Transport): Mr. Speaker,
you will understand that I find it extremely difficult to sit here
and listen to the minister, or rather the MP, who was a minister
under the former Conservative government before becoming the
Leader of the Opposition.
Mr. Speaker, on December 11, in this House-
(1505)
The Speaker: Order! So, my dear colleagues, this is a very
simple matter. I will ask the hon. Minister of Transport-I had
not done so before but I will now-whether he used the word
``liar'' in this House. Obviously, this is unacceptable and I
would ask him, if he has used such words, to withdraw them
right away.
Mr. Young: Mr. Speaker, of course, the respect I have for this
House forces me to recognize that the phrase ``to tell lies'' or the
term ``liar'' are unacceptable in this House. So I withdraw the
word ``liar''.
Some hon. members: Hear, hear.
The Speaker: I accept that statement.
_____________________________________________
4585
ROUTINE PROCEEDINGS
[
Translation]
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons): Mr. Speaker, I
have the honour to table today in the House, in both official
languages, a number of order in council appointments which
were recently made by the government.
Pursuant to Standing Order 110(1), these are deemed referred
to the appropriate standing committees, a list of which is
attached.
* * *
[
English]
Hon. Charles Caccia (Davenport): Mr. Speaker, it is my
duty and indeed my pleasure to present today in conformity with
Standing Order 109 of the House of Commons to table the first
report of the committee of the environment and sustainable
development.
In doing so, I would like to take the opportunity to thank the
government for this most interesting assignment; the members
of the committee for their work, advice, input and very
thoughtful support; the clerk, researchers and support staff for
their dedication, advice, guidance and the benefit of their
experience.
I would also in a particular way like to thank all the witnesses
and those who in large numbers advocated the thrust of this
report, making most valuable recommendations on how the
proposed commissioner of the environment and sustainable
development is to operate.
4586
We have looked at the future well beyond the next election.
We have produced a report which, if adopted, would serve
Canada well into the next century. What we are proposing, if
adopted, would take Canada to the forefront in the global
community both in anticipating and preventing depletions in our
ecological and natural resource capital and in integrating
economic with environmental goals so that once and for all we
get out of the dangerous balancing act we find ourselves in as a
society.
In adopting the committee's recommendations, the
Government of Canada will be giving substance to its
commitment to an environmentally sustainable future and will
assume its rightful place as a leader in the world community.
* * *
[
Translation]
Hon. Lucien Bouchard (Leader of the Opposition) moved:
That, pursuant to Standing Order 81(4)(a), consideration of Public Works
and Government Services Votes 1, 5, 10, 15, 20, 25, 30, 35 and 40 of the Main
Estimates for the fiscal year ending March 31, 1995, by the Standing Committee
on Government Operations, be extended beyond May 31, 1994.
(Motion agreed to.)
* * *
(1510)
[English]
Hon. Warren Allmand (Notre-Dame-de-Grâce): Mr.
Speaker, I have a petition signed by over 800 residents of
Quebec requesting effective political action to stop the violence
and genocide in Bosnia.
The petitioners point out that despite numerous UN
resolutions and ceasefires, there are still excessive cases of
atrocity and violence against Bosnian civilians: rape, murder
and ethnic cleansing.
The petitioners ask Parliament to support measures to stop
this inhumane conflict and bring justice and peace to the
Bosnian people.
Mr. Ronald J. Duhamel (St. Boniface): Mr. Speaker, I have a
petition from men and women in my constituency of Islamic
faith of several different backgrounds and nationalities who
would like to have the concept of guardianship considered as an
alternative form of adoption.
These people of the Islamic faith believe that guardianship
would have equal legal and moral obligations as does adoption.
Therefore I urge the government to consider this particular
request of these Canadian citizens.
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons): Mr. Speaker,
Question No. 37 will be answered today.
[Text]
Question No. 37-Mr. Mills (Red Deer):
With respect to the electoral observer's trip to the Ukraine on March 24, 1994,
sponsored by the foreign affairs department, (a) who attended, (b) what was the
cost by person and (c) what was the total cost?
Hon. André Ouellet (Minister of Foreign Affairs): (a)
Participants list is included. (b) The costs which are noted
reflect budgeted costs. The actual expenditures have yet to be
calculated since claims for all of the participants are not yet in.
Our preliminary assessment is that the actual costs will be, for
the most part, under budget.
Parliamentarians-$9,892.00 X 6. Ukraine specialists-
$10,600 (Including travel to Ottawa for a briefing) X 7.
Monitors (42 days)-$25,700 (Including travel to Ottawa for a
briefing and professional fees) X 2.
(c) Total costs $184,952.00.
Canadian observers for legislative elections in Ukraine
March 27, 1994
Following observers were in Ukraine for the period March
21-31:
1. Mr. Jesse Flis, Parliamentary Secretary to the Minister for
Foreign Affairs, (LIB)-Mission Head
2. Ms. Carolyn Parrish (LIB)
3. Mr. André Caron (BQ)
4. Mr. John Loney (LIB)
5. Mr. Walter Lastewka (LIB)
6. Senator Marcel Prud'homme (IND)
7. Mr. Oleh Romaniew, President of the Ukraine-Canadian
Congress
8. Ms. Alexandra Chycozij (Toronto, Ontario)
9. Mr. Myroslav Tracz (Winnipeg, Manitoba)
10. Mr. Victor Nachoneshny (Edmonton, Alberta)
11. Mr. Andrew Hluchowecky, Information Section,
Ukraine-Canadian Congress (Ottawa, Ontario)
12. Ms. Patricia Sembaliuk, (Winnipeg, Manitoba)
13. Mr. Orest Dubas, Editor Ukraine-Canada Policy and Trade
Monitor (Montreal, Quebec)
Following monitors were in Ukraine for the period from
March 6 to April 16:
14. Mr. Bill Mukanik, federal Returning Officer
15. Mr. Don Slobodzian, former provincial Returning Officer
(Alberta)
4587
[English]
The Deputy Speaker: The question as enumerated by the
parliamentary secretary has been answered.
Mr. Milliken: I ask, Mr. Speaker, that the remaining
questions be allowed to stand.
The Deputy Speaker: Shall the remaining questions stand?
Some hon. members: Agreed.
_____________________________________________
4587
GOVERNMENT ORDERS
[
Translation]
The House resumed consideration of the motion.
The Deputy Speaker: The hon. member for
Saint-Hyacinthe-Bagot has about 24 minutes left.
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot): Thank you,
Mr. Speaker, for the accuracy in your time assessment. I had
calculated 23 minutes and 49 seconds myself, but I accept your
time of 24 minutes.
So we were considering at third reading Bill S-2, which
renews a tax agreement between Canada and five other
countries, namely Hungary, Nigeria, Zimbabwe, Argentina and
the Netherlands. It is never very enjoyable to be interrupted in
the middle of a speech, so I will repeat some of the points I
covered in detail in the first part of my speech.
The first point is that the Bloc Quebecois has nothing against
the countries that have signed the tax agreements mentioned in
Bill S-2. The Bloc Quebecois, like all Quebec sovereignists, has
shown in the past that it is open to the world, has a deep-rooted
tradition in the international cooperation and development area
and supports mainly North American but also international
agreements of all kinds.
You will recall how we supported the Free Trade Agreement
with the United States and Mexico, as well as the GATT
agreements signed last December. After long and laborious
negotiations, we came to support these conventions, these
international agreements.
The same thing applies to tax conventions. When they meet
the original needs and the criteria that have been set, we have
nothing against such conventions. First and foremost, these tax
conventions are used to avoid taxing twice a company which has
foreign affiliates.
(1515)
These are indeed very worthy conventions, but for them to
meet their main goal, there has to be reciprocity between Canada
and the countries with which we have signed these conventions.
There must be reciprocity as well as commensurate tax
treatment for profits made by the companies, capital profits and
a similar series of exemptions for private corporations.
But, these last few years, the Auditor General of Canada as
well as some Liberal members, then in opposition, denounced in
no uncertain terms some of these conventions which were
signed and are still being renewed between Canada and
countries considered as tax havens for hundreds of millions of
federal government tax dollars.
I was pointing to the flaws of the tax convention system and
explaining why we have so many reservations about a measure
like Bill S-2, as we have long been asking for a review of each of
these arrangements between Canada and various countries to
discover which countries do not deserve reciprocity agreements
or tax treaties such as the one under review this afternoon.
We were not the only ones who denounced these conventions.
Several others have already done so. For example, in December
1992, the sitting hon. member for Ottawa-Vanier, himself a
Liberal, criticized loopholes in tax conventions with countries
considered as tax havens, by declaring the following: ``We are
really worried because the Department of Finance has done
nothing to eliminate most of these schemes''-he was talking
about schemes concerning tax conventions with countries
considered as being tax havens-``used by foreign subsidiaries
to avoid taxation. In my opinion, this problem is not new and we
are confronting it again this year''.
Indeed, the problem is not new. I would say that, since 1987 or
approximately 1987, the Department of Finance has been
``dealing with'' the problems of tax loopholes associated with
tax treaties. Indeed, in 1987, the Department of Finance
announced that it would study the taxing of foreign affiliates.
These studies were never tabled. Imagine! The Department of
Finance of Canada has been aware of the problems for seven
years, and has let them deteriorate for seven years. It has let
these problems deteriorate while the Conservatives were in
office, and it is letting them deteriorate under the Liberals.
I am extremely disappointed that the Minister of Finance and
the Liberal government did not respond to our numerous calls
for a serious and comprehensive analysis of those tax
conventions that are causing the loss of hundreds of millions of
dollars to the federal treasury in a period where, for some time
already, we can no longer afford to deliberately lose hundreds of
millions of dollars. This government continues to be inactive in
the examination of those tax conventions. Even worse, it is
proposing us to extend those conventions before analyzing their
provisions as a whole.
This government perpetuates the injustices detected in some
tax conventions, the sieves for Canadian corporations that do
not carry out their duty as good corporate citizens in terms of
contributing to the elimination of the deficit and debt problem of
the federal government. I would tell you that the Liberal
government, the Liberals, the members of the Liberal Party of
Canada are only sensitive to two words: ``lobby'' and ``friends''.
4588
(1520)
As was the case for all taxation decisions that have been made
since the evening of October 25, since the last election, and in
particular since February 22 or 23, when the Liberal government
tabled its first budget, these two words have become
commonplace within the Liberal Party.
All taxation decisions have been made on this basis, on the
basis of lobbyists and friends of the party. Perhaps I should have
mentioned a third word: lobbyists, friends of the party. Friends
who have been handsomely paid for their support since the
Liberal Party came to power.
Friends who, for several years, have made generous
contributions to the Liberal Party of Canada. Friends who are
also stakeholders in tax loopholes such as those provided for in
income tax treaties, family trusts and different leaks in the
Canadian tax system.
With regard to the funding of political parties, is it normal that
big Canadian corporations contribute such huge amounts to the
Liberal Party of Canada in the same way they contributed and
may still be contributing huge amounts to the Conservative
Party of Canada, as they did last year?
Is it democratic, in a country that prides itself on being
democratic, for a government to have both hands tied and not to
be able to run the country freely because those people, from the
Liberal Party of Canada, have to please those who contributed
generously to the fund of their party? They have to be careful not
to disappoint them. The Liberal Party has to go on. Like any
other great federalist party, the Liberal Party must have some
continuity. So, when these people come to power, the first thing
they have to do is to please the friends of their party.
When someone wants to change a tax convention, for
example, and when a Canadian business that made donations to
the fund of the Liberal Party of Canada for many years comes
under fire for its ability to evade taxation in Canada, it is quite
usual, for this government, not to take its responsibilities and
bring about sound reforms.
When we learn that the National Trust Company contributed
$12,454.70 to the Liberal Party in 1993 and the Royal Bank of
Canada gave $45,000 to the same party, we are not surprised to
see that this government refuses to put in place measures that
could affect it, nor can we fail to notice a certain complicity
between a federalist message and the annual report of the Royal
Bank or any other analysis of the constitutional impact of a
certain decision that the Quebec population could make.
Is it normal too for the Liberal Party to receive $25,000 from
the Royal Trust Company, $42,000 from the Bank of Nova
Scotia, $40,000 from the Toronto Dominion Bank and $31,253
from Scotia McLeod and so forth? I could go on, there are many
other examples.
In any case, the Liberal Party of Canada gets half of its funds
from big business. So, not surprisingly, when the time comes to
make decisions in the public interest, decisions which could
further restore the public finances, at least in part, and which
could somewhat tighten the budgetary policy or close tax
loopholes, these measures, the real initiatives that should be
taken, are not.
The Liberal Party, a great Canadian party, like the
Conservative Party, came to office with its hands tied; they feel
uneasy because they have to deal with lobbies and friends of the
party.
(1525)
By the way, we saw over the week-end that if you are not part
of a lobby, if you are not a friend of the party, you are at a
disadvantage. A newspaper article this week-end said that rich
families lobbied the government to keep their tax exemption.
The Canadian Press article mentioned family trusts and said: ``A
lobby representing some of Canada's oldest and wealthiest
family businesses talked the former Conservative government
out of imposing capital gains tax on sheltered trust funds worth
billions''.
They managed to do the same with the Liberal government,
the present Liberal administration. They succeeded to do the
same, because despite pressures from the Bloc Quebecois, from
the Reform Party and from people fed up with social injustices,
tired of paying for fiscal mismanagement and weary of lack of
control on public finances, despite all these pressures, the first
budget of the Liberal Party did not abolish the privileges of
family trusts and did not plug the loopholes created by tax
treaties signed between Canada and countries considered as tax
havens.
I will continue with the article, because I found it fascinating
and very representative of everything we have denounced about
this government, about patronage and party friends. You know
that family trusts were instituted by Pierre Elliott Trudeau. I can
call him by his name since he is no longer a member of
Parliament. It was Trudeau's idea. Trudeau is our phantom of the
opera; he haunts this place. Every time you happen upon a bad
measure, as it turns out, Trudeau was behind it. And if it is not
Trudeau, it is the current Prime Minister of Canada.
Interviewed in Toronto, Mr. Sharwood, the former president
of Guaranty Trust, one of the contributors to the Liberal Party
fund, indicated that the majority of the members of his
association-read lobby or interest group-are family
businesses that go back several generations. The association
also represents families among the wealthiest. This means that
all the wealthiest families are bunched together in the same
lobby. These families, the wealthiest in Canada, have
contributed to the Liberal Party of Canada election fund. So you
can imagine what kind of a welcome is extended to anyone from
this lobby when
4589
he or she knocks on the door of the finance minister or of the
Prime Minister.
I am not surprised to see how powerful these lobbies are,
considering they spend millions, even hundreds of millions-if
you put together all the contributions made by large
corporations formed into a lobby-on furthering their own
interests, not those of the people of Quebec or Canada. I am not
surprised to see that they manage, as they often do, to prevent
this government from making perfectly legitimate decisions
that would certainly be welcome, given all the sacrifices asked
of taxpayers in Quebec and Canada, people who are already
crushed by the tax system.
I am not surprised when I look at the arrangements, at the
family trust issue. I am not surprised, but I was even less
surprised when I participated in the debate on the bill tabled by
the Minister of Transport concerning Pearson airport. During
that debate, which was very similar to this one on tax
agreements and family trusts, we discovered that friends of the
party had once again shown great strength, forming lobbies to
ensure that the Minister of Transport, in his legislation
regarding Pearson airport, would retain some discretionary
power to, perhaps, compensate them if he deemed appropriate to
do so following the cancellation of the contract for the
privatization of that airport.
(1530)
There, as in the case of the two previous issues, and
particularly this one on tax agreements, we noticed that friends
such as Leo Kolber-he is the senator who organized a small
lunch at $1,000 a plate during the elections to finance the
Liberal Party of Canada's campaign-played an active role in
the privatization of Pearson airport. Leo Kolber had invited
friends such as Charles Bronfman. Herb Metcalfe, a lobbyist
with the Capital group, was also present, as well as Ramsay
Withers, a federal lobbyist with close ties to the current Prime
Minister.
So, there were many friends of the party who, again, formed a
lobby to ask that at least some clauses in the bill tabled by the
Minister of Transport provide benefits to them. These are
friends of the party who formed lobbies. Imagine their power:
they exert direct pressure on the Liberal Party to make sure it
implements measures which will benefit their own interests.
When I see all this and when I look at what the government's
last budget, which was its first one, contains in the way of
budget cuts at the expense of the average citizen, I am disgusted,
because I have yet to hear a single Liberal, among all those who
have been complaining bitterly about such cuts for the past eight
years, object to the fact that the government is doing nothing
about unfair practices and loopholes in the Canadian tax system,
while on the other hand, in order to improve the state of the
federal treasury, it introduces measures like cutting $5.5 billion
from the unemployment insurance fund, eliminating the age tax
credit, and generally, measures that come down hardest on the
neediest in our society who are already depressed because they
have no work, and are now facing additional constraints.
As in all other areas, it is clear the members of this
government are arrogant and cynical in the extreme. I keep
repeating this because it is true. Every day I wonder how the
Liberals can treat people the way they did, the Liberal members
of the finance subcommittee which examined the bill on
amendments to the Unemployment Insurance Act. I am really
disgusted at the way they behaved.
People came from the Maritimes, all the way from St. John's,
Newfoundland, to appear before the committee, which hardly
bothered to listen to their grievances about the unemployment
insurance cuts. The government did listen to the lobbyists who
asked them not to eliminate certain tax conventions with
countries that are considered to be tax havens. The government
did listen to the richest families in Canada who wanted the
government to maintain the outrageous preferential treatment of
family trusts.
They came all the way by car, like those who came from the
Acadian peninsula, and they were thrown out because they came
to express their grievances. They came to say they were
ashamed of supporting a government that had promised to put
the economy in the Maritimes back on track, but instead had
shown it could not care less what happened to them and dozens
of communities in the Maritimes.
I get rather emotional whenever I talk about inequity and
unfair taxation, because as a newcomer in politics, I sincerely
believed that people who for years had been fighting for more
tax equity and who made their objections heard every time the
Conservatives introduced measures which they themselves
condemned, were sincere. I thought that these people were
sincere. In spite of our differences of opinion on constitutional
matters, I really thought that they were sincere, but I realize now
that they are nothing more than good actors. They are excellent,
but the play does not last forever.
(1535)
When I see this kind of measure, when I see the richest
Canadians keep their privileges when the poorest members of
our society are being asked once again to tighten their belts, this
year, next year, and until the end of this government's mandate, I
tell myself that, one day, common sense will prevail. People will
realize that this government is a puppet government, and that it
may be time for Quebec to change the constitutional order of
things, to take its future into its own hands, and to implement
real measures. It is time for fair taxes, for a Quebec tax system in
a sovereign Quebec, based on the principle of equality for all,
and taking into account the needs of our poorest citizens.
I have been wishing for and dreaming of such a system. These
people are making this dream of a fair tax system even brighter.
Let us dispel the nightmare of this unfair federal tax system.
4590
[English]
Mr. Ray Speaker (Lethbridge): Mr. Speaker, it gives me
pleasure today to speak on Bill S-2, the Income Tax Convention
Act, which deals with a number of tax conventions. My intention
in the next few moments in the debate is, first, to support the
principle of the bill; second, to raise some general questions;
third, to raise our specific concerns with regard to points in the
bill.
As I listened to the debate so far on the bill there is a lot of
latitude I could take. I could move all the way from the countries
we are dealing with here-Hungary, Nigeria and
Zimbabwe-and into the bedrooms of the nations, it seems, in a
very easy and facile way in this assembly.
In looking at the bill, as was mentioned by the Parliamentary
Secretary to the Minister of Finance it is certainly a
housekeeping bill, but there is a very important principle in it.
The extent to which we deal with the principle and apply it in
relationships with various countries of the world is very
important not only to Canadians but to the other countries
because today our world is certainly changing as never before.
Technology is allowing us to deal with every country of the
world. Whether they are friends or semi-friends, we can deal in
a businesslike way with countries. People in this country can sit
in their living rooms, their kitchens or small offices in their
homes and deal with countries anywhere in the world in terms of
our technology and making business arrangements. That is one
aspect of it.
Another aspect is that we want people in our country to use
their skills, abilities, knowledge and technology to work with
the people of other countries. They can exchange the same
attributes we have so that they can be of benefit not only to other
countries but also to persons who work within the confines of
other government jurisdictions.
As was mentioned, the purpose of the bill is to prevent income
tax evasion, double taxation or unfair taxation of people who
work between one country and another. That principle is
certainly important.
The countries we are dealing with at this point in time are
Hungary, Nigeria, Zimbabwe, Argentina and the Netherlands. If
there are other areas of the world we should deal with, we should
do so to make sure there is consistency. This is a good first step.
(1540)
What are some of the general questions I would like to raise
for the parliamentary secretary or the Minister of Finance to
consider in their response at a later period in the debate?
First, why are we only signing on with the limited number of
countries listed and not some of the emerging markets we will be
trading with in the future?
Second, is the reason for these conventions that tax evasion
exists in Canada due to our comparatively high level of
taxation? Or, is it that the government is not willing to prevent
the problem from occurring by bringing our tax level in line with
those of other countries? Is the problem we are facing a tax
question rather than the consistency question that has been
raised here?
Third, is it realistic to expect these conventions to be
workable when Canada's tax system is considerably more
complicated than that those of the countries with which we are
signing these conventions?
Fourth, is our high taxation level responsible for people
leaving to go to these countries and is that the reason we need
these conventions?
There are some specific concerns I wish to raise with regard to
Bill S-2. First, article 21 on page 43 of the bill allows for
Canadian professors teaching in Nigeria to be tax exempt from
both the Nigerian government and the Canadian government. Is
the government allowing tax loopholes to exist that we should
deal with in terms of our tax policy?
The second concern I raise is with regard to article 10,
paragraph 2(b), at page 60 which allows Canada to tax dividends
emulating from Zimbabwe funds invested in Canada at 15 per
cent but Canadian dividends from investments in Zimbabwe can
be taxed at 20 per cent. Is this contrary to the concept of
reciprocity?
The third question I raise is with regard to article ll, paragraph
3(a), at page 61 concerning interest arising from Canadian
bonds held by Zimbabwe investors that can only be taxed in
Zimbabwe. In this case the converse is also true. This is a
questionable article because it is unlikely that very many
Canadians will invest in Zimbabwe government securities. This
is interest that will leave Canada and probably will not return.
Those are some of the general questions I have with regard to
the bill and some of my specific concerns. I would appreciate it
if the parliamentary secretary, or one of the government
members who has investigated the bill further, could respond to
those questions.
On behalf of the Reform caucus I would like to say that in a
specific sense with regard to the principle we support Bill S-2
and will do so on the floor of this assembly.
4591
Mr. Walker: Mr. Speaker, I have already spoken at this stage
of the bill. I just want to indicate that the comments of the
Reform Party spokesperson were heard and that a response will
be made.
(Motion agreed to, bill read the third time and passed.)
* * *
(1545)
[Translation]
Hon. David Anderson (for the Minister of Canadian
Heritage) moved that Bill C-31, an act to amend the Canadian
Film Development Corporation Act, be read the second time and
referred to a committee.
Ms. Albina Guarnieri (Parliamentary Secretary to
Minister of Canadian Heritage): Mr. Speaker, the government
of Canada is pleased today to propose to the members of this
House amendments to the present Canadian Film Development
Corporation Act, in order to create a loan guarantee program
that will give companies in the Canadian film and video industry
easier access to sources of private funding.
This program, which is the outcome of a very detailed
analysis of the needs of the Canadian film and video industry,
will allow better management of public funds without involving
the federal government in any additional expenditure. It will be
managed by one of our major national cultural institutions,
Telefilm Canada, and will guarantee loans totalling $25 million
annually.
The program, in fact, will be an invaluable financial incentive
contributing to the growth of the Canadian film and video
industry. Its objective is clear and its scope considerable: to
encourage our financial institutions to become better acquainted
with this industry and devote more of their resources to funding
Canadian production and distribution companies. For it must be
said that the financial institutions have always been reluctant to
participate in funding companies of this type, because they were
unfamiliar with the cultural sector and considered intellectual
property as inadequate security from a financial perspective.
In recent years, the financial position of the film and video
industry has been affected by the continuing decline in resources
available from both public and private sectors. Telefilm
Canada's annual resources will shrink by some $195 million, or
22 per cent, over the period from 1992-1993 to 1997-1998.
On the one hand, the banks are not co-operating as much as
they might and, on the other hand, government funding has
consistently fallen. If this trend continues-and there is little
chance of a turnaround in the foreseeable future-production
will decline and this will inhibit the government's efforts to
ensure that Canadian cultural products of quality are available
on our own market.
The time for action is now. Change is necessary if Canada's
cultural industries are to establish themselves in the new
cultural landscape that is now taking shape. They have always
had to deal with the proximity of the ``American giant'' whose
vital mass culture assures worldwide success.
Ours is one of the most open cultural markets on earth. While
this is certainly enriching for all Canadians, such openness also
represents a threat to our own creative artists. We cannot allow
our national culture to be marginalized in our own domestic
market, or fail to provide it with every opportunity to prosper in
foreign markets.
The loan guarantee program is an innovative solution to this
problem. As well as demonstrating this government's
commitment to protecting our cultural sovereignty, it aims to
diversify the funding sources of a fast growing industry and
foster good business relations with new financial partners.
(1550)
[English]
The situation is especially pressing in that a study conducted
in 1992 reveals that the growth of the Canadian film and video
industry is limited by chronic lack of access to sources of
interim financing. It is difficult, even impossible, for Canadian
film and video companies to obtain from the banks the funding
they need for their activities when their only guarantee is a letter
of intent from a broadcaster or distributor.
The contract signed on the basis of these guarantees are worth
an estimated $70 million to $100 million a year. This shows how
important they really are. Once it is in place, the loan guarantee
program will rectify what has been a problem to the industry and
could generate up to $143 million in activities related to film
and video production and create several thousand jobs.
The Canadian film and video industry which barely existed 20
years ago has experienced phenomenal growth and is now a
major employer and a producer of high quality entertainment
programs.
The figures speak for themselves in this regard. The total
revenue of this industry, despite fluctuations from year to year,
rose from $122 million in 1980 to more than $835 million in
1992, with the number of direct and indirect jobs totalling more
than 50,000 in 1992.
According to Statistics Canada, the revenue from exports of
film and broadcast products jumped by $210 million from 1980
to 1989 to reach $230 million. There is no doubt that this is a
vital and viable sector of Canada's economy. The loan guarantee
program could not come at a better time to stimulate the growth
4592
of a dynamic Canadian industry and to establish a relationship
of trust between cultural enterprises and financial institutions.
It is possible to hope for better co-operation between the
cultural and financial sectors and over the long term reduce
dependency of the cultural sector on public funding. This is the
objective of this legislation.
The risk is small. Any potential losses will be covered by a
reserve fund established with Telefilm's current parliamentary
appropriations and the user fees levied from recipients. Telefilm
Canada will subject applications for loan guarantees to close
scrutiny using strict criteria to ensure that only promising
projects submitted by solvent companies receive such
assistance.
This is the first step in that direction. It is not unthinkable that
the Government of Canada, if it considered it appropriate, would
contemplate extending this program to the publishing and sound
recording industries which also suffer from chronic under
funding and the same lack of understanding on the part of
financial institutions.
The minister has asked the officials in his department to study
this possibility. In a way it would be a question of applying the
same tried and tested solution to a similar problem. The
challenges of the 1990s must be met with the solutions of the
1990s. The importance of the cultural sector, both in terms of
strengthening our national identity and the economy, calls for
judicial changes to the structures already in place, especially at
a time when borders are fading and it has become imperative to
preserve everything that makes us unique as a country.
The loan guarantee program partakes of such a vision and
attests to the government's commitment, set out in the red book,
to promote Canada's cultural development. It is an innovative,
effective and economic tool that will contribute to the prosperity
of one of our most flourishing cultural industries, enhance the
production of quality Canadian cultural products and enable
banks to better understand the needs of Canadian cultural
enterprises.
(1555)
[Translation]
Mr. Louis Plamondon (Richelieu): Mr. Speaker, first of all, I
would like to say that the Bloc Quebecois fully supports this
legislation, and this includes the official critic, the hon. member
for Rimouski-Témiscouata and all members of the Bloc.
We know that this proposal is the result of three years of
discussions conducted by the Department of Communications,
the Treasury Board, the Department of Finance and Telefilm.
The process, which started under the Conservative government
three years ago, has finally led to the tabling of a bill, and I want
to congratulate the government on acting so promptly in this
respect. We seldom hear good news from the government
nowadays, but when we do, I think we should stress the fact, and
I am delighted to salute this initiative on behalf of all my Bloc
colleagues.
It was high time the government interrupted a bleak series of
cutbacks that have been a burden on the cultural sector in
Canada and decided to introduce a measure long awaited by the
film community.
Between 1992 and 1998, the government would have cut
about $100.5 million from its grants to a film industry in full
expansion.
The measure before the House today is a godsend for the film
industry which suffers from a glaring lack of capital funding.
Good projects that never set off the ground because of lack of
cash are legion.
A study by the Department of Canadian Heritage has revealed
that today, letters of agreement between producers and
distributors worth a total of between $70 and $100 million have
not been signed because of lack of money.
Furthermore, many very interesting projects never get beyond
the production stage because they are not judged to be
commercially viable. This bill will fulfil its purpose if it also
reminds Telefilm Canada of its original mandate, which is to
support all Canadian cultural products, not just the commercial
ones.
Like SOGIC in Quebec, Telefilm Canada should give equal
treatment to commercial films and documentaries, television
and cinema, as well as female and male filmmakers and
producers.
If it achieves its twofold purpose, Bill C-31 will ease the
plight of Quebec and Canadian producers who are waiting for
the government to deliver on another measure that is essential to
the survival of this industry, and I am referring to a tax credit
that would replace the existing tax relief for depreciation.
A tax credit would directly benefit Canadian film and video
production, unlike the present tax shelter. It is estimated that
only 7 per cent of the cost of this tax measure is reinvested in
Canadian productions as such. The tax credit would not require
any additional investment.
Introduced in Quebec in 1990, the measure has been a real
success story and truly serves the interests of the Quebec film
industry.
In concluding, I again wish to congratulate the government on
this very appropriate initiative, and as an incentive to keep up
the good work, I would like to quote what was said a few weeks
ago by Pierre DesRoches, outgoing president of Telefilm
Canada: ``A country that does not have what it takes, either
intellectually or financially, to make a feature film does not
deserve the name''.
Finally, I would like to reiterate the support of Bloc members
for this bill and express the hope that the bill will pass all three
stages today, so that producers who have been waiting for years
4593
will perhaps not see their dreams come true but at least have
some way to get the money they need to start production.
[English]
Mr. Bob Ringma (Nanaimo-Cowichan): Mr. Speaker, my
remarks on Bill C-31 will be premised on the assumption that
most of us in this Parliament want to do what is best for our
country as a whole and for the industries, such as the film and
television industries which are a part of that entity.
(1600 )
What is the best role that Parliament can play? My thought is
we should try to have the most thorough examination possible of
any subject that forms the basis of a bill before the House.
I do wonder if Bill C-31's timetable is going to permit the
examination the bill merits. It was tabled on Thursday, May 26.
It was announced on Friday last that second reading would be
today, Monday, May 30. I found out about it Friday afternoon. I
do not think that is too much time to gather the facts on a subject
one is not particularly familiar with.
One of the problems the public at large is having with the
government and Parliament is the perception that decisions are
made behind closed doors, that government with a majority in
Parliament can do as it pleases. This House could dispel that
impression by bringing things into the open. I am not suggesting
there is anything concealed with Bill C-31, but surely more time
for consideration would help the debate as well as the public
perception of it.
What should be examined in detail is the whole concept of
government assistance to industry versus free enterprise. There
is a role for government to play, especially regarding start-up
industries.
There is, for example, a real lack of venture capital in Canada.
The government should not get into the business of providing
venture capital, but it should encourage it through taxation rules
on capital gains. If the government does get involved with the
provision of loans or loan guarantees, it should do so for a
strictly limited period of time. No industry that habitually
depends on the government for support is going to prosper in the
long term.
As we consider the extent to which the Government of Canada
guarantees loans, we should be mindful of Canada's deficit and
debt situation. With the federal debt at the $500 billion dollar
mark the government must send out a signal of fiscal
responsibility and a capability and willingness to get things
under control. Its signal to date is inadequate. While Bill C-31 is
a relatively minor matter, the loan guarantees it proposes
exacerbate the government's position on the side of fiscal
responsibility.
On the positive side of this bill we note that similar loan
guarantee programs exist in several of our provinces. Quebec,
Ontario, Saskatchewan, Alberta and British Columbia all have
programs of guarantees. They have experienced a very low rate
of default which is good news.
It is also noted that the Canadian Film and Television
Production Association and l'Association des producteurs de
film et de télévision du Québec both believe this program will be
of great benefit to the industry. The government has stated it
believes the program should only exist for a short period of time.
That is on the positive side of it.
(1605)
Also on the positive side, there is evidence of real growth in
the industry in western Canada. Activity in indigenous Alberta
productions has increased by 360 per cent in the last few years.
British Columbia has enjoyed similar growth. This increase has
come without any federally guaranteed loans. It shows that
relationships between the producers and Canadian financial
institutions is healthy and is improving. Perhaps this indeed
demonstrates there is no longer a need for guaranteed loans.
This House should look closely at what is happening in the
industry in western Canada, that the provinces alone are able to
furnish the guarantees necessary and that this is having a very
positive effect on the industry. It is growing and succeeding.
Why then do we have to keep coming in with federal government
intervention?
The other concern I would voice, but on the positive side
concerns co-operation interprovincially and internationally.
There are joint production efforts going on between the
provinces and between our country and others. This also is a sign
of success. That is where we should allow the industry to
capitalize on its success and go in that direction.
If this program goes ahead another concern is the equitable
distribution of loan guarantees. This is to be to all of the
provinces. I would like to know from the government what
process will be used to ensure an equitable distribution if the bill
takes effect. If the effect of Bill C-31 is to regionalize the
industry, to concentrate more development in Ontario and
Quebec as opposed to the development which is going on in the
west of Canada then again it is not going to have the effect it
should be having. If it is going to regionalize, please let us make
sure this regionalization is not concentrated in one area but is
spread throughout.
The spokesman for the bill in committee mentioned a promise
to get rid of Telefilm as a crown corporation. I would like know
from the government what the time schedule is on that and when
it thinks it should happen. Also, why was the statement made
that Telefilm could eventually be done away with when the
4594
government is doing more now to jack it up with Bill C-31? I do
not quite understand that.
In conclusion, I encourage the government to introduce bills
such as Bill C-31 with a little more leeway in the timing to allow
for more comprehensive preparation for debate. We do agree the
government has a role to play in encouraging industry,
particularly fledgling industries in Canada. However, it seems
to us the role should concentrate on providing appropriate tax
incentives rather than loans or loan guarantees.
(1610 )
If in its wisdom and with its majority the government decides
to proceed with this bill, we caution it to put a time limit in the
bill, a sunset clause as it were, and to ensure that the
international financial community fully understands why this
temporary assistance to this Canadian industry is needed.
Ms. Guarnieri: Mr. Speaker, I rise on a point of order. Are
there questions and comments?
The Deputy Speaker: No.
Mr. Julian Reed (Halton-Peel): Mr. Speaker, as a matter of
fact I thought this would be a question and comment period
myself, but now that I have the floor I will address some of the
comments made by my hon. friend from the Reform Party.
In this House I may be the only member of the Alliance of
Canadian Cinema, Television and Radio Artists. I have knocked
around the industry performing professionally since 1966. I can
recall where film was at that time, where it went and what the
inhibitions were to its proper and orderly development in this
country.
Film development and the development of a base for film
production in Canada is much more than loan guarantees,
although they are part of it. It is much more than tax incentives
which have not always worked in the past.
The requirement has been for a consistent employment of
both technical and performing talent which would allow the
medium to continue to grow in this country. It is not enough to
establish an industry on a one-time basis. What happens is you
can bring in a lot of mediocre capability and end up with a
mediocre product and then have nowhere to go from that point
onward.
To this point the development of film drama in Canada with
the assistance of successive governments has been consistent. It
has been consistent enough so that the talent base has been
maintained and cultivated in this country, not just the talent base
for performers but the talent base for technical people, the
technical base for all of the ancillary needs of a film industry.
It has grown to where it is starting to be recognized as being
one of the best places to produce films and television programs
in the world. That was not so in 1966 when producers and
directors who in the main were from other countries looked upon
Canada as a place to go to to get cold.
I recall a company in Toronto called Film House which
established one of the most sophisticated and advanced systems
for film dubbing. It ended up failing because it could not attract
the volume of work needed to keep afloat.
It has been a constant battle, a constant effort, to prove that
Canadian capability ranks as world class in order to attract the
kind of-my friend refers to joint efforts with other
countries-joint effort as a result of assistance to the Canadian
film industry that allows the rest of the world to look on it as
being second to none. As hon. members will know, we are now
in a position where we are able and do produce television series
and so on which we export to the rest of the world.
(1615)
Film production as we know is a very individualized effort.
My friend talked about making sure that these loan guarantees
were spread across Canada. I have to tell him that film
production is site specific. It is not relegated to the major
centres of this country. Feature film is shot in every province of
Canada but it is done on a film specific basis. I believe that loan
guarantees in this case are probably superior to tax write offs.
I can remember when there were very attractive tax write-offs
in the film business. A lot of film was produced that never saw a
screen. It never got farther than the can but it fulfilled the
requirements for the tax write-off.
I would suggest when we are considering assisting this kind of
venture that we should be taking those elements into account.
We have reached a certain stage in development. I use the phrase
talent base. Talent base is a much more broad term than actors as
I think we will all accept. We have reached a level where
Americans like to come to Canada because grips, technical
people, cameramen and women are able to compete on a world
class second to none. Facilities now have developed to a point at
which we have some of the largest sound studios in the world.
We have the best technical people. We have a class that we can
offer. What happens is that these productions in effect de facto
become an export for Canada.
Support for the performing arts in the past has often taken
second place to things that some people considered to be more
important. I have to say that if we look at support for the
performing arts, whether it is in theatre or film and so on, it has
an economic spinoff that may be as high if not higher than any
other venture.
If anybody wants to challenge that I would invite them to
downtown Toronto any night of the week to see all of the
theatres that are operating at the present time and the spinoff
effects that has on the economy of metropolitan Toronto for the
people who work in the service industries, et cetera.
4595
When you and I go out and pay $65 for a ticket, which we
think is exorbitant, to see ``Miss Saigon'', we probably buy
dinner as well and take guests with us. All of that infuses
economic activity into that area.
Assistance to the performing arts, regardless of what it may
be, is an economically sound venture providing it is done in a
responsible and proper manner. I heartily endorse it.
The other thing we must consider is that we are in competition
with other countries in the world. Australia was one of the early
lower populated countries to begin to export film and television
programs. Over the years it has been very successful. Canada is
now perhaps behind in the volume of export that goes on. It is
because these countries support their industry. We can do no less
in this House than to provide that kind of support. I of course
endorse this bill wholeheartedly for the reasons I have put
forward.
(1620)
I would hope that every member in this House understands
that this kind of support is a positive thing. It is an investment. It
is something we do and we expect excellent sustaining returns.
The Deputy Speaker: I see the member from Nanaimo
getting up. Unfortunately it is not questions and comments, so
he will need unanimous consent to speak again. Is there
unanimous consent?
An hon. member: No.
Mr. Duncan: May I clarify why there are no questions and
comments.
The Deputy Speaker: The hon. member is raising a point.
The rules stipulate that when a bill is being introduced, the first
three speakers on behalf of the three parties have 45 minutes, but
there are no questions and comments after their speeches.
Thereafter, for example the member who just spoke, there is a 10
minute questions and comments period. Perhaps the member
wishes to ask questions or make comments.
Mr. Bob Ringma (Nanaimo-Cowichan): Mr. Speaker,
thank you and I thank you for the intercession of my colleague to
get it straightened out.
The last hon. member who spoke painted an almost glowing
picture of the industry today and that is good. I am very happy
that is so and it is burgeoning. In view of that, and this is an
honest question, does the member foresee the day coming when
such loan guarantees will no longer be required? Is that coming?
Is the industry successful enough that in the foreseeable future it
will be able to stand on its own?
Mr. Reed: Mr. Speaker, the intent of the legislation is to lead
toward that point. That is one of the reasons I suppose why we
would deal in terms of loan guarantees rather than tax
incentives.
We are at the point of near maturity in this industry in terms of
our ability to compete on a world-wide basis and so on. There
are still areas where this kind of assistance is desirable and often
becomes necessary.
It is not always. I know the hon. member has pointed out that
there are productions taking place in western Canada. I was
involved in one last year which was an ABC movie of the week
shot in Toronto which had no government funding whatsoever.
It is certainly getting there. We have certain things we can
offer to our friends in other countries, most particularly in the
United States because of the volume of material that it produces.
I think there is still a need to encourage and enhance the
world-wide recognition of what Canada does and what Canada
can do. We started it with some assistance. It was an investment.
It has been paying off. I firmly believe that we will see the time,
perhaps in our tenure here, where we may grow right through it
and out the other side.
Mr. John Duncan (North Island-Powell River): Mr.
Speaker, my question for the member for Halton-Peel relates
to the fact that parts of the industry appear to be operating quite
successfully without loan guarantees and other parts seem to
require it.
(1625 )
Does that not imply somewhat of a defeatist attitude on the
part of the industry in terms of why this bill is required in this
format? We first heard about it last week and we are rushing it
through this week. Is there some reason that the member is
aware of why we are going through this rapid exercise here?
Mr. Reed: Mr. Speaker, there are some productions where it
is much easier to raise money. For instance, if Canada is
shooting an American production that financing will be in place
but it will be shot as an American production.
I refer back to ``JFK: Reckless Youth'', ABC movie of the
week. That financing came here already in place. However in
Canada there are many times when one is venturing into new
areas where that financing is not as readily available and where
the banks are not forthcoming 100 per cent. Members know how
ventureless banks are when one gets right down to it.
The member would also recognize how expensive film
production really is. It is a very expensive item. I hope there is a
recognition that we are not dealing with new money in this issue.
We are not trying to create new finances or increase the deficit
and so on. We are simply attempting to direct money in a manner
that is going to be most effective, if you like, the biggest bang
for the buck.
4596
Mr. John Duncan (North Island-Powell River): Mr.
Speaker, as I have already expressed I have some concerns about
the timing on this bill and why it is being presented in the way it
is.
I am pleased to speak today on Bill C-31, an act to amend the
Canada Film Development Corporation Act. Telefilm Canada is
the better known name for the Canada Film Development
Corporation.
A major stated purpose of this bill is to help the already well
established producers develop a better relationship with
Canadian financial institutions. My interpretation of this
statement in simpler language is very different and I can
summarize it in three statements.
First, this bill is all about access to capital. Second, the bill
leaves the selection of winners and losers in the hands of the
Telefilm Canada bureaucracy. Third, this bill assumes that the
relationship between producers and banks is unhealthy. I would
like to discuss each of these in turn.
This bill is all about access to capital. The problem is that the
banks will not give anyone any money even though one has an
order. This is certainly not unique to the film industry in Canada.
Second, the bill leaves the selection of winners and losers in
the hands of the Telefilm Canada bureaucracy. This bill makes
Telefilm Canada a guarantor for the loan for part of the presale
agreement to a maximum of 85 per cent with an annual allotment
of $25 million. Each application would be to a maximum of $1
million.
This will place the producers in the situation of having to sell
their project twice, once to broadcasting or other companies and
then to Telefilm bureaucrats. Broadcasters will soon find out
which producers can sway bureaucrats and which cannot. This
will tend to distort the whole marketplace. It is one more
example of the Canadian disease whereby the government
interferes in the free market. In this case it has the effect of
backing the strongest players in the market by giving loans to
the healthiest and most established companies that apply.
(1630)
A director for Telefilm at the briefing on the bill stated that
the money would help the 50 or so strongest Canadian producers
and that it was not meant for new or fledgling producers. Over
time this will have a tendency to preclude those with new and
fresh ideas who are new to the marketplace and those from the
non-established film centres. This will be counterproductive to
Canadian culture.
Another major concern I have based on the briefing is that
there are no specific criteria in place to evaluate the applications
or proposals to Telefilm Canada. That is left open even after the
bill.
Third, the bill assumes that the relationship between
producers and banks is unhealthy. While this may be true in
some instances there are instances where it is apparently not
true, as in B.C. and Alberta examples where indigenous
productions have increased dramatically in the last few years
without federally guaranteed loans.
The bill is a response to a portion of one industry having some
difficulty accessing capital. It is important to look at the bigger
picture since this difficulty is a longstanding Canadian problem
which the parliamentary standing committee on industry has
been studying in this session with regard to access to capital for
small and medium sized businesses.
Why is there so little Canadian investment? Can we achieve
our goals with regard to Telefilm Canada through tax credits or
through motivating the banks? Both these methods are
preferable to the intent of the bill which will have bureaucrats
backing the winners. There is nothing in the bill to preclude a
grant from Telefilm Canada, a grant giving organization, and a
guarantee against production. The government may be
accepting more than 85 per cent, or even 100 per cent, of the
risk.
It is very unlikely this type of legislation would be
contemplated in Germany, one of our major trading partners.
Both Canada and Germany have a strong national banking
system, but I am told by German business people that if they
have a legitimate order in Germany they will almost certainly
get the money to produce the order. They have a very good
system to ensure that capital flows to legitimate business
propositions. It is a major strength of their country.
In one of my previous careers I was a Canadian manufacturer
with some export sales. Selling with foreign purchase orders
was preferable to domestic sales because the federal
government guaranteed the major portion of payment upon
delivery. A very positive aspect of the federal program was that
the eligibility rules were clear and certain and applied whether
one was a new entrant such as us or a long established enterprise.
Bridge financing can be a reasonable proposition if it follows
the principles of equal access to all and encourages good ideas.
We should be in a position where if we have a good idea we can
go for it. It makes no sense to have a capped and artificial
program limit of $25 million. If we want to get into this area as a
country we have a lot of homework to do and the bill does not cut
it.
(1635)
In summary, the strongest and largest film producing areas are
in Toronto and Montreal. There is concern within the industry
about equitable distribution of funds for loan guarantees. The
bill will tend to entrench regionalization for an industry that is
thriving across Canada without federally guaranteed loans.
4597
Canadian access to capital is a problem for many industries. It
is my recommendation that we look very closely at the German
example for constructive ideas we may want to adopt.
Canadians want a strong national identity. This is best
achieved through a strong cultural community that is allowed to
develop and grow with minimal government constraint. The bill
entrenches bureaucrats as arbiters of culture in my view and is
counterproductive to progressive Canadian culture. There are
many examples where Canadian banks have provided loans for
cultural program development. Let us build on this success and
attack the problem, not the symptom.
I am opposed to the bill because it is ill designed and is
counterproductive to the long term benefit of Canadian culture.
Mr. Julian Reed (Halton-Peel): Mr. Speaker, my hon.
friend is somehow opposed to the people he calls the bureaucrats
in Telefilm Canada refereeing who will get the support and who
will not.
One question I should ask him is who should referee it?
Certainly not a group of politicians from committee. Does he
have any suggestions of who would be better referees than we
have at the present time?
Another question jumped out at me during his speech. He was
talking about banking systems responding if a company had an
order. That is very commendable in itself, but what is an order
for a film? What is an order for something that has yet to be
created? It is not an order for a bottle of milk.
With it goes risk. It is a creative risk. It is all those things
banks do not like to deal in. That is why it is still necessary to
help allay some of the risk at least. Each film that is made, each
television series that is ventured, each pilot show that is done, is
done with some creative risk. Either it will be a success or it will
bomb. Some of them bomb. They are not all successful.
Mr. Duncan: Mr. Speaker, as a small manufacturer in the
furniture business with about a 20 per cent success rate, the
banks were very used to the manufacturing success in my
business. That is the best example I can give.
Every business has a degree of risk, particularly
manufacturing. I empathize with the member's comments in
terms of the banking system and how the access to capital for
small businesses is not forthcoming in the way we would like to
see. However to single out this one industry with a bill wherein
the rules of engagement afterward are not specified is not doing
our homework.
(1640)
As to who should do the refereeing, I gave an earlier example
of federal bureaucrats administering the export development
program. They are not insiders. That is my concern with having
Telefilm Canada be the arbiters. They have all the baggage of the
established cultural industry in Canada and will be potentially
blind to new regional development or new blood that wants to
come into the industry.
It was apparent in the briefing on the bill that this program
would go to the strong and the established. It was not to go to
fledglings or new entrants into the business. Who has the biggest
concern with access to capital? I would say the opposite to the
apparent intent of the results of the bill.
My suggestion on who should referee the whole process
would be someone not within that group but someone perhaps
associated with the regular bureaucracy that is used to this type
of standard setting and this type of allotment.
Mr. Ovid L. Jackson (Bruce-Grey): Mr. Speaker, I thank
both the hon. member for North Island-Powell River and the
member for Halton-Peel. This has actually been a very good
discussion.
In my previous job as mayor of the city of Owen Sound we
tried to get a centre for the performing arts. It was very difficult.
On the one hand we had to have a balanced business approach
and on the other hand we were looking at visionaries, idealists
and artists, and artists are not necessarily business people.
Let us try to imagine a world without artists. Somebody had to
dream or imagine many of the things we do in life whether it is
the CN Tower or the Corvette car we drive. Sometimes dreamers
or imaginers do not know anything about money and sometimes
they do make mistakes. The government is trying to find a
medium through Bill C-31 to encourage the arts in Canada.
We are rather unique in Canada in our proximity to the United
States and with the competitiveness from there. All of us are
aware of what happens in Universal City. We know the Japanese
are taking large chunks of it. It is a very clean industry. It is a
great industry. It is a growing industry. It is an industry that
Canadians could be proud of, with the quite recent ACTRA
awards. As the hon. member for Halton-Peel has said, we have
good film makers and a lot of producers coming to Canada. We
have an environment in major cities, as mentioned before, for
this kind of climate.
Notwithstanding it is not going to be perfect, knowing the
groups at work here. The hon. member from the Reform Party
talked about the business part of it and the hon. member for
Halton-Peel talked about the artistic part of it. Somehow we
have to merge those two parts. People have to take risks.
Sometimes they bomb. Sometimes it takes years for things to
happen, but we need these people and we need to encourage
them. I am certainly glad we on this side are trying to promote
that kind of climate.
4598
I know there have been boondoggles in the past. There will
probably always be, but hopefully we can cut out the loopholes
and have a climate to create work for our people, expression for
our people and growth for our country as the great country we
know it to be.
(1645 )
Mr. Duncan: Mr. Speaker, I do not know exactly what the
question was, but I do appreciate the fact that we both have the
same bottom line on this bill which is we want to see Canadian
culture improved as a result of the cultural industry in Canada. I
certainly would not want anyone to think that was not the
direction I was also heading in. I thank the member for his
comments in that regard.
The Deputy Speaker: The time for questions and comments
has expired.
Mr. Elwin Hermanson (Kindersley-Lloydminster): Mr.
Speaker, it is a pleasure to speak to Bill C-31, an act to amend
the Canadian Film Development Corporation. I am rising to
voice my opposition to this bill. It will encourage state
intervention in what should be a naturally evolving and
privately funded industry. I will begin by speaking broadly.
Culture cannot be bought. It is something which exists
because people practice it. They live it. They are it. It cannot be
artificially created or preserved by the state. All cultures thrive,
evolve and change naturally as the wishes and practices of the
people change.
Although a young country, Canada has a culture and it is one
to be proud of. We need to define what that culture is. Reform
has taken a swipe at identifying some components of Canadian
culture.
We believe that Canada's identity and vision for the future
should be rooted in and inspired by a fresh appreciation of our
land and the supreme importance to our well-being of
exploring, developing, renewing and conserving our natural
resources and physical environment as a part of culture.
We believe the people of Canada are this country's most
valuable resource. The nurture and development of human
knowledge, skills and relationships are the keys to full
participation in the knowledge based service economy of the
21st century.
We believe the creation of wealth and productive jobs for
Canadians are best achieved through the operation of a
responsible broadly based free enterprise economy in which
private property, freedom of contract and the operations of free
markets are encouraged and respected.
Furthermore, we believe in the value of enterprise and
initiative. Governments have a responsibility to foster and
protect an environment in which initiative and enterprise can be
exercised by individuals and groups.
Looking at Bill C-31, it reminds me of an old tax incentive
program. I believe it was introduced by the Liberals, but maybe
it was the past Conservative government; sometimes it is hard to
distinguish between them. It was a research and development
tax credit scheme. All of us believe in research and development
and we want to promote that, but this scheme attracted a number
of con artists. It was a fiasco. The design of the program caused
the loss of millions and millions of tax dollars because it was not
properly handled. It was interfering in what should have been
more of a private sector enterprise.
We believe every individual, group, province and region in
Canada is entitled to fundamental justice. Fundamental justice
entitles the people of each region to benefit equally without
discrimination from participation in Confederation and from the
programs and expenditures of the Government of Canada. There
is some doubt as to whether Bill C-31 in fact would be broadly
based across the country and allow equal access by all
Canadians.
To repeat what I said, Canada although a young country has a
culture, one we should be proud of. It includes peacefulness,
fairness, compassion, excellence, tolerance, initiative of spirit,
an appreciation of the arts, in spite of government red tape, high
taxes and inefficiency.
Any attempt to artificially interfere with the natural progress
of Canadian culture is destined to become just one more failed
attempt at social engineering. It is certainly not the role of
government to dictate what the culture of the population will be
nor is it appropriate for the government to interfere on the edges
as is the case with C-31.
Much apart from the fundamental issue of state intervention
within society, the bill itself has some significant problems. The
loan guarantees this bill would provide will diminish the
opportunities that would allow new, innovative and evolving
cultural enterprises to break into the market.
Under this bill loans would likely be guaranteed to the
healthiest existing companies. This will have the dual effects of
entrenching the existing players in the market, thereby
establishing an elitism within the industry which will hinder
change and growth within the industry, and creating an industry
that finds itself increasingly out of sync with mainstream
Canadians.
(1650 )
Not only would this bill have a detrimental effect on the
cultural industry in Canada but there is nothing to suggest that
loan guarantees are required. For example, the motion picture
industry in Alberta has had a 360 per cent increase in
productions over the past few years without federally funded
guaranteed loans. The results in B.C. are similar.
These examples prove there is no requirement for guaranteed
loans at all. This bill is unlikely to have an impact on regions
with fledgling industries like Saskatchewan. It is not that I
support this type of funding for regional development purposes,
but not even the regional development argument can provide a
4599
pretence of defence for Bill C-31. One might question whether
this bill is another of the government's special interest payouts.
Furthermore there has been a trend in Canada for more jointly
funded projects involving Canadian and international
organizations. Canadian culture can thrive in the private market
and has demonstrated it can do so. One such example is the
filming of the Clint Eastwood movie ``Unforgiven''. It was
filmed in Fort MacLeod, Alberta. The venture involved many
Canadian production companies, one of which won an Academy
award for set design.
Many Canadian television programs have gone into
syndication as a result of partnerships with international
agencies. There is a list of Canadian companies which have
prospered without federal loan guarantees through this kind of
international co-operation. They include: Alliance
Communication Group; Paragon Entertainment Corporation;
Accent Entertainment; Astral Communications; Cinar Group
Ltd.; Nelvana Ltd.; Atlantis Media Group; Power Pictures
Corporation; Post-Production Buzz Inc. These are but a few.
These companies are testament to the fact that Canadians can
compete and thrive in the entertainment industry without
government interference. It is these kinds of ventures that are
going to drive the industry and also be most in sync with
mainstream Canadian culture.
Art and culture for its own sake as an industry has its place in
generating economic growth, but it is not the kind of thing we
should be looking at to lead an economic recovery and end
unemployment woes for Canadians. This government is
constantly telling us, the media, the public, and anyone else who
will listen that its priority is jobs. This bill will have no effect on
unemployment. It may make job creation more difficult if the
government has to shell out money to cover defaulted loans.
Some people may be looking to make political mileage by
smearing our position on Bill C-31 and will say that there is a
Reform bias against culture. That is clearly not the case. We
want to remove all government barriers to the promotion and
growth of Canadian culture. We do oppose government handouts
to business, even the business of culture.
We take the same line with cultural organizations as we do
with all businesses and special interest groups; that is, you
cannot expect to get grants, loan guarantees and tax holidays
from the government indefinitely. All special interest groups
should raise money from the people they claim to represent or
they should have a project that is viable enough that the bankers
will lend them the money.
There are many examples of where we would reduce funding
for these groups in the spending plan we published during the
last election campaign. Our zero in three package outlined very
clearly that business and special interest groups of all kinds
would have to expect less from government in the way of grants,
loans and loan guarantees.
There are some significant omissions in this bill, especially
where issues of loan criteria and repayment details are
concerned. Many people in the industry have very grave
concerns that nepotism is rampant within some of these
organizations. Many projects are funded on the basis of who
knows who and family relationships rather than on artistic merit
and economic potential.
The bill omits all explanation of repayment terms. If the
government is backing 85 per cent of the loan and the loan
defaults after partial repayment, is the government portion
considered to be paid off first? Is the government liable for any
of the interest on the loans when it backs over 50 per cent of the
value? If not, what is the incentive for the banks to ever accept
any less than 15 per cent of the risk?
It appears this bill was thrown together in a hurry, probably at
the request of special interests, without completely thinking
through the implications of such loan guarantees. I guess the
details will be supplied later, but it does make us question the
wisdom of supporting such a bill.
Voting for this bill and many others like it would be like
co-signing on a loan when one's account is $520 billion in the
red. I would not like to be considered as an accomplice to that
crime against our future generations.
(1655)
Another concern is that this program will encourage the
government to underwrite those projects that would not
ordinarily have been considered as an acceptable risk. That
means the default rate is likely to be significantly higher than
the current one which, by the way, is very low. If this happened,
it would seriously hurt the reputation of the industry which has
been steadily improving over recent years. As it stands, only
those projects considered viable receive funding. That seems to
be a reasonable place to set the standard for funding.
I said it once and I will say it again: You cannot buy culture.
All you will get for trying to do so is a whole lot of debt. If the
original idea behind this bill was to build a cultural future for the
next generation, it will succeed in a small way. It will help to
build a culture of high taxes and crippling debt. It will contribute
to a society that strips away most of a family income to pay
interest on a debt the previous generation ran up. It will create a
culture that exists with no government services, no safety nets or
social programs because most government revenue will be
going to debt financing. This will be a country with massive
4600
unemployment since no investment capital will be forthcoming
to a nation in such a financial mess.
This culture of debt and poverty is not the kind of Canada I
want to create for the next generation of Canadians. That is why
I must oppose this bill and all bills like it. The accumulation of
many bills which spend tax dollars unwisely is the reason we
have accumulated such a huge debt to this point in our history.
It is time for government to carry out its most pressing
responsibility and let the private sector do the same in its area of
expertise, namely the marketplace. This bill encourages rather
than discourages state participation in the marketplace. It is
likely to increase rather than decrease government spending. It
is likely to discourage rather than encourage new, innovative
and emerging firms from entering the industry. It perpetuates
the idea that a nation's culture can be designed by a select few
and artificially preserved by the state.
As a final concern, this bill was only tabled in the House on
May 26. Without adequate time, it has been brought forward for
debate on second reading. Over one weekend our caucus has had
a limited amount of time to study this bill, to discern its
implications. As we look into it initially, we have some grave
concerns about the wiseness of supporting such a bill. We will be
reviewing this bill in detail in our caucus.
We are trying to slow down debate on this bill to give it some
some second thought so that this House can make wise decisions
in the way we are putting the taxpayers' dollars on the line in
loan guarantees. After all, it is the taxpayers we represent and in
the final account they are paying the bills we run up.
Mr. Julian Reed (Halton-Peel): Mr. Speaker, my hon.
friend seems to have a philosophical thing about state
intervention. It was a major theme at the outset of his speech. I
hope he will express the same views to his agricultural
constituents, the farmers in this constituency. I hope he will
express the same ideas on the formation of the auto pact. I hope
he will express the same thing to his business constituents on the
small business development corporation, or with the oil patch on
the tax investments and the uncollected tax. There is the aircraft
industry too. I could go on and on.
Canada has had a history of a mixed economy. There are many
good reasons for it. One of the main reasons has been the size of
the elephant we sleep with to the south of us. It has been
considered necessary from time to time not with any ideology in
mind but from a practical point of view to deal with issues as
they have arisen.
State intervention is not new. I am surprised the hon. member
is treating this as if it were some kind of new conjuring. It is not
new. I am a little older than the hon. member. Maybe the hon.
member does not remember the difficulty Canadian musicians
had in being heard and the almost impossibility of getting
Canadian productions over radio until the CRTC came into the
picture. And that was state intervention too, I should say.
(1700)
Look at what happened. Look at the result. The result of that
investment is that all across Canada, whether it is in French
Canada or English Canada, there is a thriving music industry
today. It largely came about because those people, those
performers and creators, for the first time were able to have their
music heard in a large forum.
My hon. friend says that the business of granting loan
guarantees will create an elitism. I respectfully suggest to him
that this kind of intervention will prevent elitism, If investment
money is only going to go to the strongest, the survival of the
fittest, that to me is elitism. It seems to me that one of the
functions of these loan guarantees is to prevent that.
Finally, I would suggest to the member that in spite of the fact
that he has tried to create this illusion, this is not new money we
are talking about here. This is a redirection of money. We are not
adding to or increasing the deficit.
I suggest that he take those things into account.
Mr. Hermanson: Mr. Speaker, it is with real pleasure that I
respond to the hon. member's concerns and also his questions.
First of all, he is absolutely correct. I do come from an
agricultural riding that depends on agriculture, small business
and the production of oil. I might tell the hon. member that in
our agriculture policy we clearly discuss with producers how we
might save taxpayers' dollars, how we might become more
efficient in the defence of the industry of agriculture without
spending more money but in fact spending less, and how we
would not justify spending for agriculture in areas unless they be
beyond the control of producers. I would suspect that Bill C-31
does not affect film producers or the film industry in areas
beyond their control.
I heard from small business that they want an end to grants
and tax concessions, loan guarantees. It is not fair. If I do not
happen to be the beneficiary of the program then I am paying my
taxes for someone who is the beneficiary of the program. I may
go out of business trying to pay the taxes to keep my competitor
in business. It is a very unfair appropriation of tax dollars,
whether it be in the form of grants or in the form of loan
guarantees or whatever. It is a distortion in the marketplace
when what helps Peter is paid for by Paul and many times they
are in the same industry.
I know I have the support of small business in my concerns
with this bill. The oil industry, by the way, has similar concerns.
I have spoken in this House about the foolishness of spending
millions, billions perhaps, of taxpayers' dollars on
megaprojects such as Hibernia when we are not sure that they
are fundamentally sound projects.
4601
The marketplace has a very good nose for sniffing out where
investments should be made and where they should not be made
and government has a notoriously bad reputation for being able
to sniff out what is a good business venture and what is a poor
business venture.
I want to respond briefly to the hon. member's concerns over
our giant neighbour to the south and the effect that that has on
our culture. He mentioned specifically the music recording
industry and the fact that radio stations in Canada have to play a
certain percentage of Canadian content in their air time. Perhaps
it might be even good to review whether that has had a positive
effect on the recording industry in Canada.
I spoke some time ago with the general manager of a radio
station who felt that this ruling had limited the growth of the
recording industry in Canada. He said there were very few
recording artists in Canada who had ever made it until they made
it big in the U.S. Because of some of the restrictions in our
recording industry they tended to leave the country and become
Americans rather than maintain their allegiance to and close
association with Canada.
(1705 )
It is not true in all cases. We certainly have many recording
artists in Canada whom we are very proud of. There is some
doubt as to whether or not this Canadian content rule has been a
blessing or a curse to the Canadian recording industry. In some
ways it has suppressed the industry rather than assisted it. I
guess time will tell. We certainly do not have tons of
testimonials to be proud of. Even today most Canadian
recording artists do not make it big in Canada until they have
made it big in the U.S.
We have to be looking at our own confidence and the fact that
we do not consider someone to be of any value because
government dollars go to support them. We expect and measure
value based on the saleability of what is being produced for us.
That is the true measure of quality and the true measure of
culture in Canada.
Mr. Ian McClelland (Edmonton Southwest): Mr. Speaker, I
am going to take just a little different approach to this than my
hon. colleagues who preceded me on both sides of the House.
I think that we have to look at this in reality as what it is and
not be ashamed of it. It is an infrastructure program for the film
industry. We should not be ashamed of that. If you look at every
film industry in the world, save the United States or India
perhaps, there is a good deal of government intervention in the
film industry of one kind or another.
We are trying with this particular bill to make the intervention
that we have in our film industry work a little bit better.
The film industry in Canada, as other members have
mentioned, because we are so close to the United States with its
ever pervasive influence in our culture, is particularly important
because our sense of identity as Canadians, as we all know, is
very much wrapped up in the reflection of what we see of
ourselves when we are watching television. Much of our sense
of Canadianism or what it is to be a Canadian we take from what
we see on TV every day.
In the expanding universe of television of 500 channels of the
future, when you see people up north living a nomadic or
semi-nomadic existence in the barren lands of Canada watching
Detroit television, you think: ``My God, what kind of vision are
we reflecting of ourselves as Canadians''. Television and film
production to Canadians reflects the kind of people that we are
or would want to be. That is of particular importance.
We have to break this bill into two separate issues. One is
television and the production of film for television. The second
is the production of feature films. All of the infrastructure
money in the world or loan guarantees in the world is not going
to make one iota of difference in the feature film industry if you
cannot get your feature films on to the screen and all of the
screens in Canada are controlled by Odeon and Paramount out of
Hollywood.
We have to look at this in two very distinct and very real
approaches, one being feature films and the other being
television. Canadians have had a good deal of success in
producing television indigenously here in Canada.
I draw hon. members' attention to this interesting fact. We
have the CBC in English Canada and Radio-Canada in Quebec.
In Quebec the CBC has far more viewership per capita than the
CBC in English Canada despite the fact that we spend more
money on television in English Canada with the CBC. I submit
that the reason for that is the French CBC has far more
indigenous programs, far more programming that originates in
Quebec.
In English Canada if you look at CBC's primary productions
on any evening, what is it? It is a repeat. I know I am getting into
the CBC thing again, but prime time viewing on CBC is all
rehashes of American programming.
(1710)
If we really want to do something about feature films and
particularly made for TV production in Canada, our national
carrier in English Canada should be carrying a lot more
Canadian originated TV production.
That leads us to the question of public money, financing and
how you get it to how do you get money into the hands of
entrepreneurs that want to do a movie for TV or feature film. I
am 100 per cent behind our caucus position. We do not have the
right to take money from future citizens of Canada, children yet
4602
unborn, to give to people today so that we can live better today
than we should.
As an hon. member mentioned earlier, when we start weaning
our economy from government dependence, we have to wean
our economy slowly. We have to wean the whole economy, not
just one sector, away from dependence on government grants
and handouts.
This industry is no different than any other industry. It has to
work on its own independent of government financing. How
does it go about doing that? One way would be to relax the rules
whereby people could get public equity participation in a movie.
Imagine how difficult it would be with an intellectual
property if you go to a bank and say: ``I'd like to finance this
movie''. When you show the script, you are asked: ``Where's the
bricks and mortar?''. You say there are no bricks and mortar.
The information highway, computer programs and software
are not bricks and mortar either. Somehow we have to allow our
entrepreneurs to get money from people who are putting hordes
and hordes of money into RRSPs to invest in ideas in this
country.
The only way we are going to be able to do that is to relax the
rules in our corporations act so that people are able to invest in a
movie production. Yes, it would be extremely high risk but the
rewards would be there.
I do not think we can say this is all one way or all another. I
agree 100 per cent with my colleague who said earlier that we
should not be using government money to finance any private
venture. The minute you start using public money in a private
venture it is no longer a private venture. It is a public venture.
On the other hand it is particularly important that we in
Canada support our cultural industries particularly our made for
television movies because TV is so much a pervasive part of our
day to day lives. We see ourselves reflected back from TV with a
sense of value as to what it is to be a Canadian.
If everything we see on television is imported from some
other part of the world it is going to be even more difficult to get
a sense of Canadianism, to be together as a nation.
I would like to see us import more of the films done in Quebec
and dubbed into English and vice versa. Perhaps that would be a
way to start getting some communication going back and forth.
This is in some ways a difficult bill for our caucus to wrap
itself around because of the involvement of public and private
money but I think on balance it is worthy of support. Again, it is
not new money. It is a realignment of present moneys. Telefilm
must be more sensitive to the regions and more accessible to
producers outside Montreal and Quebec, Toronto and Ontario,
but I understand that it is working in that direction.
We need access to big screen television for our feature films.
We have got to break the monopoly of Paramount and Odeon to
get our feature films on to our own screens.
(1715 )
The Deputy Speaker: Is the House ready for the question?
Some hon. members: Question.
The Deputy Speaker: Is it the pleasure of the House to adopt
the motion?
Some hon. members: Agreed.
Some hon. members: On division.
(Motion agreed to, bill read the second time and referred to a
committee.)
* * *
Hon. David Anderson (for the Minister of Finance) moved
that Bill C-32, an act to amend the Excise Tax Act, the Excise
Act and the Income Tax Act, be read the second time and
referred to a committee.
Mr. David Walker (Parliamentary Secretary to Minister of
Finance): Mr. Speaker, I rise to move second reading of Bill
C-32. This is an important bill which will give legislative effect
to excise and income tax changes announced over the past four
months.
The primary purpose of the bill is to implement a range of
measures related to tobacco taxation that were developed to
combat the very serious smuggling problem facing Canada.
These measures were announced in the House of Commons by
the Prime Minister on February 8, 1994 and form an integral part
of the government's national action plan on smuggling.
The legislation includes, among other things, first a national
reduction in the federal excise tax on tobacco products equal to
$5 per carton of 200 cigarettes, $5 per 200 tobacco sticks and $5
per 200 grams of fine cut tobacco as well as a reduction in the ad
valorem rate for cigars to 50 per cent.
Second, additional reductions in the federal excise tax on
tobacco products marked for sale in a particular province where
the province has reduced its provincial tobacco tax.
Third, an excise tax on tobacco products for export with
exemptions for legitimate exports for consumption outside
Canada.
4603
Fourth, a health promotion surtax that would increase the rate
of federal tax paid by tobacco corporations under tobacco
manufacturing and processing profits.
The bill also contains changes to the air transportation tax and
the goods and services tax that were announced in the budget of
February 22, 1994. These changes are intended to improve the
fairness and efficiency of the tax system and to raise revenues.
The measures undertaken in this respect are:
First, changes in the structure of the air transportation tax to
reduce the tax burden on short-haul domestic and transporter
flights and to recover a greater proportion of the cost of air
facilities and services provided by Transport Canada.
Second, a reduction in the goods and services input tax credit
for eligible business meals and entertainment expenses to better
reflect the personal consumption elements of these expenses.
I would like to turn specifically to measures to address
tobacco smuggling. There was a dramatic increase in tobacco
smuggling in 1992 and 1993. Strong evidence indicated that
most Canadian tobacco products that were exported to the
United States on a tax and duty free basis were smuggled back
into Canada and sold illegally without payment of federal and
provincial taxes.
By the end of 1993 these contraband products accounted for
about 40 per cent of the total domestic tobacco market and
represented a revenue loss to the federal government of more
than $1 billion and an additional loss of $1 billion to the
provincial governments.
The impact of tobacco smuggling goes far beyond the
financial costs and the negative impact on the government's
ability to deliver needed programs and services. Even more
troubling are the social costs associated with the contraband
trade. With up to 95 per cent of the contraband tobacco market
controlled by organized criminal elements, law-abiding
wholesalers and retailers were forced to watch as their
legitimate business interests gave way to a climate of increased
violence and lawlessness. The proceeds from tobacco
smuggling were being used as the foundation for further
criminal activity.
(1720)
The social costs associated with tobacco smuggling are
equally troubling from a health perspective. Increased market
penetration of cheap contraband tobacco effectively reduced the
average price paid for cigarettes and undermines the
government's health policy objective of reducing tobacco
consumption, particularly among youth.
To respond to these very serious problems the government
announced a comprehensive anti-smuggling initiative on
February 8, 1994. Within the framework of this national action
plan both the RCMP and Canada customs have undertaken
increased measures to disrupt the contraband trade in tobacco
and other products.
These organizations have been assigned substantially
increased resources in terms of both personnel and technical
equipment and are deploying these resources to intensify
surveillance and detection along the Canada-U.S. border and to
more effectively target organized smuggling networks.
To facilitate the increased enforcement efforts the
anti-smuggling initiative includes a national $5 reduction in
federal excise taxes on tobacco products. This reduction
narrows the price differential between contraband and legal tax
paid on cigarettes across Canada, thereby weakening demand
for contraband and reducing the incentive to smuggle in all
provinces.
Recognizing that the smuggling problem is more pronounced
in some parts of the country, the government has extended an
offer to match any provincial tobacco tax reduction in excess of
$5 up to a maximum total tax reduction of $10 per carton of 200
cigarettes. This bill implements the federal tax matching
reductions in response to provincial tax reductions undertaken
in Quebec, New Brunswick, Ontario, Prince Edward Island and
Nova Scotia.
The government is very concerned that tobacco corporations
not derive any benefit from the difficult decision to reduce
tobacco taxes. Toward this end the bill imposes a new health
promotion surtax that will increase by 40 per cent the corporate
tax rate in respect of tobacco manufacturing and processing
profits. This surtax will apply for a three-year period and will be
used to fund the largest anti-smoking campaign in the history of
the country.
In response to the role that export shipments have played in
the contraband market, the bill reimposes an excise tax on
exported tobacco products. An export tobacco tax equal to $8
per carton of 200 cigarettes is designed to more closely control
export shipments and prevent any recurrence in the level of
shipments that would effectively supply the contraband trade.
At the same time the bill makes adequate provisions for
manufacturers to undertake legitimate export shipments
intended for bona fide consumption outside of Canada.
In addition to these direct changes to excise and income taxes,
the bill also contains a number of related measures that are
designed to complement the new tax measures and ensure their
long term effectiveness. At the time the national $5 reduction in
federal excise taxes was announced, the government wanted to
ensure that the reduced rates of tax were immediately passed on
to consumers at the retail level, complementing enforcement
measures by weakening the demand for contraband tobacco
products.
Consequently the government has undertaken to pay a full
inventory rebate to all wholesalers and retailers in respect of
their inventories of tobacco products on February 8, 1994.
Where federal excise taxes are further reduced to match a
provincial tobacco tax reduction, wholesalers and retailers are
eligible for an additional inventory rebate to the extent that
their inventories of cigarettes exceed a certain threshold
amount.
4604
The use of threshold levels is designed to protect the interest
of those persons holding large inventories of cigarettes while
limiting the government's total fiscal exposure.
(1725)
Administration of the rebate program is being conducted by
Revenue Canada and is already well under way with retailers
and wholesalers from across the country filing their inventory
rebate claims and awaiting payment of the appropriate amounts.
Inventory rebates cannot be paid however until such time as
this bill which provides the Minister of National Revenue with
explicit legislative authority to issue amounts in payment of
inventory rebate claims is approved by Parliament and receives
royal assent.
Ensuring that retailers and wholesalers receive these amounts
as soon as possible is one of the main reasons we are attaching
such a high priority to the bill. In view of the variable federal tax
reductions undertaken by the federal government in response to
specific provincial tax reductions, the bill contains provisions
that are designed to ensure payment of appropriate federal
excise taxes and also to deter any interprovincial diversion of
tobacco products.
First, the bill provides for the collection of federal excise tax
differential where tobacco products marked for sale in one
province are sold for any purpose other than personal
consumption by a consumer in that province. Thus if a
wholesaler or retailer sells products to a person in another
province, the seller will be required to pay an amount equal to
the additional federal excise tax that would apply if there had
been no provincial tax reduction.
Second, the bill contains provisions making it an offence
subject to a fine for any person to sell or offer for sale tobacco
products marked for sale in one province to a consumer located
in another province. The amount of the fine is set at no less than
$1,000 and not more than three times the additional federal
excise tax that would have applied to the tobacco products had
there been no provincial tobacco tax reduction.
The combined effect of these two measures will be to
substantially impair the potential for interprovincial diversion
of tobacco products from low tax jurisdictions. While the
collection of the additional federal excise tax can be enforced
immediately, the offence provision cannot come into force until
such time as the bill receives royal assent.
Also in response to provincial tax reductions, the bill contains
provisions to deal with the sale of unmarked tobacco products
on Indian reserves in Ontario and Nova Scotia. Both these
provinces require that tobacco products sold on reserve free of
provincial tobacco taxes not be marked. Matching federal tax
reductions on the other hand are based on distinct provincial
markings.
To reconcile these different marking requirements and to
ensure that unmarked tobacco products sold on reserve to
Indians in Ontario and Nova Scotia are taxed at the reduced
federal rates that would otherwise apply to marked tobacco
products in each province, the bill contains provisions that allow
for the sale of unmarked tobacco products at the reduced rates of
federal excise tax to specially licensed wholesalers and retailers
in each province.
Finally, the bill amends the fines in the Excise Act for
possession or sale of tobacco products on which federal taxes
have not been paid. Because these fines were based on the
previous rates of federal excise tax, this amendment is necessary
to maintain the fines at their former minimum and maximum
amounts.
These proposed legislative amendments are a very important
part of the government's action plan to combat tobacco
smuggling. Together with increased enforcement, these
measures form an integrated approach that provides the
foundation for a long term solution to the smuggling problem.
I would like to turn to other measures in the legislation, the air
transportation tax. Bill C-32 also implements changes to the air
transportation tax announced in the federal budget of February
22, 1994. The structure of the air transportation tax is being
altered to reduce the tax burden for short haul, domestic and
transporter flights and to recover a greater proportion of the cost
of air facilities and services provided by Transport Canada.
To reduce the tax burden and short haul, domestic and
transporter air travel, the current $10 flat tax component will be
reduced to $6.
(1730 )
This measure addresses the concerns expressed in recent
years by carriers providing short distance air transportation
services to smaller communities that the tax places too heavy a
burden on short distance travellers. To enhance the cost
recovery with respect to air facilities and services the maximum
air transportation tax on domestic and transborder air travel is to
increase from $40 to $50. The tax on international travel is also
increased from $40 to $50 where the transportation is purchased
in Canada and from $19 to $25 where the transportation is
purchased outside Canada for travel to Canada.
4605
These new rates apply to tickets purchased outside Canada
that include an international departure from Canada on or after
May 1, 1994 except where the tax has been paid prior to that date
and to tickets purchased in Canada on or after May 1, 1994.
A third measure relates to the goods and services tax. The bill
also contains an amendment to the goods and services tax. As
announced in the February 22 budget, the portion of the goods
and services tax paid on business meals and entertainment
expenses which may be recovered as an input tax credit is being
reduced from 80 per cent to 50 per cent.
This change will better reflect the personal consumption
element of these expenses and is consistent with the reduction in
the income tax deduction for business meals and entertainment
expenses from 80 per cent to 50 per cent. The reduced rate will
apply to expenses in respect of meals and entertainment
consumed or enjoyed after February 1994.
In conclusion, Bill C-32 is an important bill. It enacts a
number of measures related to tobacco taxation that will make a
very important contribution to eliminating smuggling as a
significant national problem, as well as implementing other
excise tax changes from the government's first budget.
While some of the tobacco related measures have been
implemented on the basis of a ways and means motion, two very
important measures, the ability to pay inventory rebates to
wholesalers and retailers and the offence provisions in respect to
interprovincial diversions, will not take effect until the bill
receives royal assent. I would, therefore, urge my colleagues to
give speedy passage to the bill.
[Translation]
Mr. Pierre Brien (Témiscamingue): Mr. Speaker, I will
follow up on the last comment of the government's
representative. It is obvious that people will receive no refund
until the bill is passed. Let me explain.
Bill C-32 proposes legal measures resulting from the
announced decrease in taxes on tobacco products. Some
storekeepers had inventories for which they had paid the higher
amount and most of them have had to absorb the cost of that
decrease in taxes, except those who had 5,000 cartons of
cigarettes or more for example. It is those people who would
now receive inventory rebates.
This is what the parliamentary secretary was talking about
when he said they would not receive any inventory rebate until
the bill is passed. That being said, I do not think this is reason
enough to rush this bill which contains many elements.
There is no need to remind you of the improvisation and
confusion that surrounded the implementation of the action plan
against smuggling. It was difficult to convince some provinces
to join in; I am sure my colleagues from the other side remember
it quite well. Toward the end of the process, many steps were
taken just to please them and to ensure a greater consensus.
And now, as is often the case, the necessary measures are
presented to the House in an omnibus bill. One of these
measures deals with transportation. The government probably
thought that this plan against smuggling would pass easily since
it had been requested from the very beginning of the session.
They thought that members of the Bloc Quebecois would
support it, and that they could, discreetly, try to add something a
bit more controversial, something dealing with air
transportation.
I will come back to this measure which, at first glance and if
we do not get satisfactory explanations in committee, might
rankle somewhat the Official Opposition.
(1735)
Let us come back a bit to the smuggling phenomenon. How
did it happen? Everybody remembers how widespread it had
become. There had been a relaxed attitude about it for years. To
give you an example, in my riding of Témiscamingue, which is
not in the Far North, but north of the main urban centres, it took
a while before smuggling arrived. But last year it was amazing
to see how easily smuggling networks had taken over. They
provided a form of service which, up to a point, could be seen as
a model of efficiency. They had home delivery. Customer
service was exemplary, and the networks controlled two thirds
of the tobacco market, which is enormous.
It took a long time before we could make the government do
something. It was only after the federal government realized
that it was maybe losing a billion dollars a year that it decided to
act. It also took many demonstrations. You probably recall the
MATRAC in Quebec which openly defied the government and the RCMP. It organized demonstrations, highly publicized and largely covered by the media, to sell cigarettes to the public at prices that even smugglers could not match. These small business people
Of course, there were winners. Everybody involved in
smuggling made money out of it. We can even say that
consumers who bought tobacco products on the black market
benefited from it and the companies which manufacture these
products have certainly not seen their sales drop.
In the last few years, cigarette prices were on the increase.
Governments had decided to use price as a deterrent to curb the
use of a product which had harmful effects on consumers'
health. We were certainly not in favour of dropping cigarette
prices in order to increase consumption. Far from it! That never
was a motive of ours. On the contrary. We always maintained
that such a measure had to be accompanied by an active
education campaign on tobacco use-the effects of which were
4606
known-but what was needed then was perhaps a more
convincing anti-smoking campaign.
Thanks to smuggling, tobacco products had become very
cheap and easily accessible to just about anyone due to the
extent of the distribution network. In my riding, smuggled
cigarettes could easily be found in high schools and CEGEPs.
They were quite visible. You will remember that, at one point,
the government had thought that, by having different packaging
for export, it would solve the problem, and that people would be
embarrassed to be seen with them, but such was not the case.
I remember that during the Christmas break, when I met with
friends in public places, I would for the fun of it check the
number of smuggled cigarette packs on the tables, as opposed to
legal ones. Many people had bought cigarette cases in which
they hid their smuggled cigarettes; I would say that every other
package was smuggled.
It is estimated that cigarette smuggling accounted for 40 per
cent of the market in the Atlantic provinces, over 60 per cent in
Quebec; that is a lot. In Ontario, it was 35 per cent and 15 per
cent in Western Canada. Those were the statistics just before the
government took action. It means that the problem has spread
from east to west, and that it is still relatively minor in western
Canada where provincial governments have not had to take the
same measures as Quebec, Ontario and three Atlantic provinces
to curb this problem which has not yet taken hold there. I am not
certain though that they will be immune from it much longer.
Ottawa is an important player in all this, because multiple
jurisdictions were involved and things had to be done on
protected territories; smugglers used tax-free zones to get their
goods through. They even used some protected areas to establish
warehouses. The federal government, which had jurisdiction
over that, had to intervene. Originally, this was seen as a very
local problem concentrated in the Montreal area. The problem
grew and finally was seen as a provincial problem, but here in
Ottawa, it was perceived as a regional problem. After the
election, every weekend that I went to my riding, people spoke
to me about the size of this phenomenon and I can tell you that I
heard a lot about it during the election campaign.
(1740)
My riding is close to Ontario, separated from it only by a lake.
Because Ontario did not follow the federal plan, I can tell you
that there was tremendous pressure on the Ontario side; many
people crossed to our area to buy packs of cigarettes legally in
our stores, since the tax where they lived was higher. A sort of
negotiation went on before Quebec, Ontario and the other
provinces came up with a joint plan, because clearly it would not
be effective in the long run if everyone did not come on side or
the provisions were not acceptable to all.
I told you that that market had become too big, Mr. Speaker;
let us look at estimates of the contraband market from the
departments of Finance and Revenue. In 1993, 2.1 million
Canadians consumed 90 to 100 million cartons of smuggled
cigarettes, with a retail value of $4.5 billion. That is awful. Of
course you can tell me that this problem has been partly solved.
Yes, partly; we must say that the plan has been very effective in
some respects. Lower taxes strongly discouraged the whole
market and the underground economy related to it. We must
learn lessons from that. There are some things to keep in mind.
I was just telling you that price was used to deter or strongly
discourage people from consuming that kind of product. It has to
be done but we must also know the limits of such a system, in
that we cannot enforce it or do the legal follow-up, due to all
sorts of problems that we know very well.
In 1988, cigarettes were $25 a carton. From 1988 to 1993, in
the matter of five years, during a period when, let us not forget,
Canada had a strong anti-inflationary monetary policy-which
it is still pursuing-and inflation was low, the price per carton
went from $25 to $48, a $23 increase. That is a substantial,
almost a 100 per cent increase. All the while, the price of
cigarettes remained constant in the United States.
There were some exports, because Canadian companies do
export to the American market, although not all that much. But
all of the sudden, exports to the United States increased
phenomenally. It took us some time to realize that these goods
were making their way back into Canada to be resold here.
Domestic sales were dropping, while exports were
skyrocketing. That was proof, obvious proof, that something
was wrong.
We dragged our feet and dragged them some more. We did not
use the legal measures available to us at the time to exercise
control over this situation, which eventually deteriorated to the
point where we had no other choice but to cut taxes. Now, we end
up with a less than positive product, in fact one which is harmful
to your health, being easily accessible at a cut price on the
market. You can change the colour of cigarette packs and change
the packaging any old way, price remains the main disincentive.
We must admit that prices, being as low as they are, if they are
not a major incentive, are not much of a disincentive either. We
must be well aware of that. This is not a product we want to
promote.
I can remember the Prime Minister saying these measures
would only be temporary. The bill says very little on the subject,
and I cannot blame its authors for not wanting to make their
intentions known just now, but it might be interesting just the
same to know a little more about the cigarette price increases
planned for the next few years.
4607
(1745)
That is why this bill, because of some aspects I will address in
a little more detail, raises questions we have the right to ask in
committee and to examine with experts in the field and with the
people involved. It is not true that, because we waited two
months for the bill to be tabled, it will go through quickly
because we are told we must now quickly repay the retailers who
had large inventories.
Why are they concerned about it now? They were not at the
time. They wanted one month and then two months. Why all of a
sudden, just as they are introducing a transportation measure
that may be controversial? Let us look at this plan which was
announced in this House by the Prime Minister. His plan had
several elements. The first dealt with law enforcement, which
would clearly have been insufficient by itself, but it was a global
plan to increase the number of customs and RCMP officers.
They were supposed to hire 350 extra customs and Revenue
Canada employees. Increasing control measures was one
element of the plan.
The second element was to reduce tobacco taxes. The federal
government reduced federal taxes by $5 plus an extra dollar
depending on what the provincial governments did. In the case
of Quebec, for instance, this allowed for a $11 cut. The Quebec
government reduced taxes by $11 and the federal government by
$10. Federal taxes were limited to $10 per carton.
We also implemented measures concerning tobacco-product
manufacturers. Under pressure from the Government of
Ontario, towards the end when it seemed very reluctant to get
involved in this process, an export tax of $8 per carton was
introduced. This tax or this kind of tax had been tried a few years
before and turned out to be so inefficient that we had to retreat a
few months later because of the powerful lobby of the
manufacturing companies that threatened to move their
operations abroad.
They now seem to be telling us that this measure could be
implemented. Whenever they talk to us about it, they always
talk about a tax of $8 per carton. What they forget to tell us is
that, in fact, it will apply very rarely since estimated production
before smuggling, that is the first 3 per cent of production sold
abroad, including on the U.S. market, will not be subject to this
tax. Its only purpose will be to prevent exports from coming
back into the country.
It would be interesting to make a more in-depth review of this
bill in committee, to look at its merits and to see if it is merely a
show-off to comfort some who thought that this measure alone
would be sufficient to eliminate smuggling. A promotion surtax
was also included, a surtax on profits made by tobacco
companies which was to be invested in a campaign for the
promotion of health. I will come back to this, which was the
original intention. However, these measures are not part of the
proposed legislation today.
There were also measures against tobacco consumption,
including regulations to limit access to vending machines and
other similar measures designed to deter people from smoking.
This was the initial plan. Now, we have this bill. The first part of
the legislation, which specifically concerns the fight against
smuggling, contains a series of measures. As I recall, there are
eight of them.
As I said earlier, there is also a reduction in the excise tax,
which means a reduction in the price, since the GST applies to
the excise tax and the amount of GST on that tax is reduced. This
is one aspect. There is a further reduction for provinces willing
to go beyond a certain amount, as is the case for Ontario,
Quebec, Nova Scotia, New Brunswick and Prince Edward
Island. As far as I know, this is an option which remains open to
other interested provinces. This is the type of issue for which we
would like to get answers when the Standing Committee on
Finance will look at this legislation.
There is also the imposition of an excise tax and offence
provisions that apply where tobacco products taxed at a reduced
federal excise tax rate in one province are diverted to another
province.
(1750)
We are trying to put an end to some illegal activities carried
out this time by well known and registered retailers, who make
up another kind of smuggling ring.
Another provision in this bill ensures that unmarked tobacco
products sold to Indians on reserves in Ontario and Nova Scotia
are taxed at the same reduced federal excise tax rates as marked
tobacco products sold to other consumers in those provinces.
There is nothing wrong with this provision.
There are also provisions for rebates of excise tax paid on
tobacco products in stock when federal excise tax rates were
reduced. I want to lay emphasis on this last issue, because it
means that the government will compensate retailers who had
tobacco products in stock at that time, who had bought the
products at the old price and now have to sell them legally at the
new price.
Since the new price is lower than the old one, storekeepers
must sell at a loss. Now the government tells them that it is
going to compensate them. What it does not say is that it will
only compensate retailers with an inventory of 5,000 cartons or
more.
In my own riding, I have small retailers, corner store owners,
small grocers, and even a distributor who does not have 5,000
cartons in stock. For them, the losses are significant. In Quebec,
there has been a $10 federal tax reduction. That means that a
carton now sells for $10 less.
4608
A corner store owner who has 50 or 60 cartons in stock stands
to directly lose $500 to $600. It may not seem like much to you.
But these people who have been fighting against smuggling
rings for three, four or five years have suffered heavy losses
already. And they will suffer even more. They will also be the
ones to pay for the plan. Nobody will say it out loud but this is
the price they have to pay for the fight against smuggling. Some
retailers pay more than others. For an inventory of 1,000 or
1,500 cartons in Quebec, you have only to multiply by ten to
know what the losses are. And they are substantial.
We received a great many calls in the days following the
announcement of the anti-smuggling plan, especially since the
Quebec government chose to compensate all the retailers,
whatever their inventory, via its forms and a method it considers
rather simple. Thus, the information is available. The
information is not impossible to find. It exists and it is available,
and we could have agreed to use the information that the Quebec
government has on the inventories of all Quebec retailers to
determine the compensation.
We could have had an agreement. These people who speak
almost daily about reducing overlapping almost never act on it.
Here they had an opportunity to easily compensate retailers,
using the list already established by the Quebec government.
But they did not do it.
Since that plan to fight smuggling costs about $300 million-
which would have been higher if we had decided to compensate
small retailers also-we ask them to bear a significant part of
those costs. I am sure that Liberal members also received
complaints from retailers in their ridings. Of course, business
went up for many retailers in the days after the plan took effect.
Higher tobacco sales helped make them accept a measure they
never liked.
But nevertheless, it is a blatant injustice for them. Of course,
we could say that they sometimes win when there are small tax
increases, but they never get such a break all at once. Although
many retailers had reduced their inventory because of lower
sales due to smuggling, many of them still had a large number of
cartons in stock and they had to pay the price. However, the
government is not in a hurry to give them a refund. Only those
retailers who had 5,000 cartons or more in stock will be
compensated. And now the government says: ``We have to pass
this bill quickly because it is one of our highest priorities''.
But what about small retailers? Are they not a priority for this
government? That is a question we have a right to ask. I will not
elaborate any further on the sixth measure because I am certain
that, at committee stage, some people will come to explain to
government members the impact that this measure had on their
businesses and to tell them what $1,000, $2,000 or $5,000 can
mean in a year to a small convenience store. God knows we have
many of them, and all kinds of other stores where cigarettes are
sold, like drug stores, and food stores that have somewhat larger
inventories and that suffered substantial losses.
(1755)
In that regard, it would take much more specific reasons to
justify the arbitrary figure of 5,000 and the fact that the federal
government is not acting like the Quebec government which,
while wanting to fight against smuggling, chose to reimburse
everybody. It did not choose to make small retailers pay the cost
of it.
The seventh measure is an adjustment to the fines applicable
for illegal possession or sale of unstamped tobacco products. Or
course, these measures are good, if they are applied.
The eighth measure is the imposition of a surtax on tobacco
manufacturing profits. That surtax looks good. It looks like it
affects the companies themselves. But we must understand that,
with the price reduction, it will be very easy for manufacturers
to pass the cost of that surtax on to consumers. That is not to say
that we should necessarily be against that measure, but the
government should be honest and say that this is an indirect way
to admit that it has not reduced prices as much as it seems. It
looks good to say that manufacturers will pay for part of it,
whereas in fact it will be very easy for them to pass this burden
on to consumers, especially since no mechanism is provided to
prevent that.
The government wanted to look good saying: ``See, those who
profited from it, the manufacturers, will have to pay their share
of the cost of the fight against smuggling''. Except that,
ultimately, the manufacturers will have the last word in being
able to easily pass it on to consumers.
I would like to come back to another point. I remember taking
part in a few discussions or open-line programs where people
would say things like: ``We oppose that measure because it will
be costly, and will have a terrible impact on public health''. I
could understand their concerns but, at the same time, I thought
and many people thought that the black market had taken on
such huge proportions and was undermining public trust in the
whole tax system to such an extent that even this measure would
not be enough to restore that trust. Tough action was needed to
regain control because the distribution networks were very well
established. Apparently, those networks are now being used
more and more to sell liquor. And the black market racketeers
will find other products to sell. Had we left them one more
product, because it was a sure market and for all kinds of good
reasons, consumers would have felt justified to take advantage
of the bargain. A frightening variety of products could have been
smuggled through this network.
Those were a few of the arguments served up, that it made
sense for economic reasons, but the government understood
their point of view and told them that it would clearly define a
policy or a prevention campaign in conjunction with that. The
government and the Prime Minister himself said that they
would invest-the money raised with the surtax-directly in a
health promotion campaign against tobacco use. And the Minis-
4609
ter of Health said the same thing. It pleased her to reassure
people by saying the same thing.
In concrete terms, and I am referring to a surtax which could
generate around $200 million in revenue, I am not sure-far
from it-that we have seen the effects of such a promotion
campaign. If so, I would be interested to know what they are.
The best way to assess the effectiveness of something is to ask
whether people are aware of it. I am rather close to everything
that is going on in government, but I do not really feel the
concrete effects of that. People are saying very little to me about
it. Professionals from the health field, from regional health
offices in my area have asked me: ``When will this campaign
start? What form will it take?'' Their input has not been sought,
and they are still waiting.
But we too are still waiting to see which direction the
government is going and what the minister of health will do to
make sure that she gets the amounts that she has been told she
would receive from the surtax. ``Directly'', Mr. Speaker, it
seems to me that it cannot be clearer. These amounts should be
linked to that. Well, it is simple for her, because she has a source
of revenue. Now, we would like to know how she will use it.
I want to quote from the speech that the Prime Minister made
in this House: ``The amounts thus collected will allow the
funding of the most important campaign against tobacco ever
seen in Canada''. We are waiting. It will certainly be one of the
things that are yet to come.
(1800)
There are two other measures in that bill. The first one,
probably the less controversial one, was announced in the
budget. The government has reduced the income tax deduction
for business meals expenses that was claimed by business
executives or independent workers. That deduction is reduced
from 80 per cent to 50 per cent. The GST will be adjusted
accordingly. The GST rebate that was claimed by those people
for meals expenses has also been adjusted in the same
proportions. It is a minor adjustment. We can argue whether the
rate should be 80 per cent or 50 per cent, which was a difficult
decision. There are many aspects involved in the budget.
A very interesting study indicated who would be directly
concerned by that measure, how they would be and what
category of meals would be affected. I am convinced that the
authors of the study would be very happy to give explanations to
the committee and to examine the impact of the measure in a
more detailed fashion in order to see who is affected, who was
anticipated to be affected and who will be, because the measure
is now in effect and we are able to know a little bit more. That
would be an interesting thing to do.
We are told that we must act quickly, that time is running out
and that we must repay retailers who have stocks of 5,000 or
more. Some say that the opposition is ungrateful, that it wants to
delay the passage of the bill and that it wants to prevent the
government from paying retailers back. The question might
have been put on the table much earlier if their concern really
was as we were told.
The third measure contained in the bill, which comes out of
the blues, deals with the tax on air travel.
These objectives were announced: the review of the air
transportation tax in order to reduce the tax burden on short haul
domestic and transborder flights, as well as to recover a greater
proportion of the cost of facilities and services provided by
Transport Canada.
Worse, they have the nerve to include short haul flights to
smaller communities. Coming from the regions, we are going to
examine thoroughly what this means. Right now there is a flat
tax. It works like this: you pay a flat tax of $10 for an airline
ticket on the domestic market. Add to this a tax of 7 per cent on
the ticket value, up to a maximum of $40.
Now, they say that they will lower the flat tax to $6, but that
they will maintain the tax of 7 per cent. However, the maximum
is raised to $50. Take the case of a region like
Abitibi-Témiscamingue. An airline ticket from
Rouyn-Noranda to Ottawa costs about $525, $530. Before, the
maximum tax was $40. Today, with the new cost structure, we
are talking of $41.
The objective is to reduce the tax burden imposed on domestic
flights, particularly on short-distance flights to smaller towns.
We can also go from Ottawa to Rouyn-Noranda. I am told that
my tax burden has been reduced with this increase from $40 to
$41. At the same time, I am told that this measure will give rise
to a recovery of $21 million this year and of $44 million next
year. I am also told that this is supposed to benefit small towns
and people living in those towns. I think that the members
opposite do not really understand what regional development is
all about. I think they did not look at that provision for very
long.
The costs are higher in some areas. Sometimes, it costs $600
or $700, and it is often more expensive to go from Montreal,
Quebec or Ottawa to some areas, in Quebec, than to fly from
Montreal to Paris. The upper tax limit on those tickets, which
was $40 before, will now be $48 or $50. One might say that it is
only an $8 or $10 difference. However, it is a lot of money.
4610
As if deregulation had not hurt enough. It was supposed to
have no impact on airfares, but the contrary is now obvious. It is
more expensive for me to return to my riding than to go to Paris.
It does not make any sense.
It is far from certain that we will let that be passed rapidly.
The Minister of Transport is in the House. He should take good
note that he will have to explain to us what he really intends to
do about this rate structure.
Only flights between $100 and $400 will benefit from this
measure, that is the Montreal-Toronto and Montreal-Quebec
runs or other popular short distance flights. Only those flights
will benefit from it.
(1805)
Do not try to tell me that with the structure I have in front of
me-unless my information is erroneous, but it comes from the
Department of Finance-travellers to the regions and to smaller
communities, as it is said here, will benefit from it. Maybe for
some, going from Toronto to Montreal is travelling to a smaller
community. However, in our region, travelling to small
communities would mean going to Rouyn-Noranda, Val-d'Or,
Chicoutimi and the like, which we consider major centres. Plane
tickets to those places already cost $600 or $700 and they will
increase by $8 to $10, though only by one dollar in my region. I
am lucky, the price of my flight to Rouyn will only be raised by
one dollar. To go to the neighbouring riding, that of my
colleague for Val-d'Or, perhaps I would have to pay $8 more.
Some might say that we do not have to worry much, since the
House pays some of our travel and other costs.
Our business people travel, they get around, they have to go
and represent their companies. Besides, people often travel for
Quebec government departments and go from our region to
Quebec City. This will increase operating costs for the other
government. All individuals who want to travel by air will have
to pay for these costs. As if by chance, this comes in an
innocent-looking bill to fight smuggling, we are told. In very
small writing, in the second to last measure, not the last
one-often we look at the beginning and at the end-we see that
there will be changes. The explanatory note in the bill says:
``The amendments to the air transportation tax reduce the tax
burden on short-haul domestic and transborder flights and shift
the tax burden to long-haul flights''.
They forget to make the connection with the price and the tax
is related to the price. I could even discuss how this compares to
the former system and how it penalizes the regions as well. I
think that they were afraid to open this debate for fear that we
would show the government members the impact of
deregulating air transport on the regions. I am sure that some
Liberal members, when they see this, will have trouble
explaining it to their constituents. I am thinking of my
colleagues from northern Ontario. How come they put up with
such a thing?
We will not let this be rushed through. It will go to committee
and we will take a thorough look at it in committee. We can work
quickly but thoroughly, that is what we will do, but at this stage,
with no major amendments, there is no question of the Bloc
Quebecois supporting this bill.
[English]
Mr. Ray Speaker (Lethbridge): Mr. Speaker, I very much
appreciate the opportunity to say a few words on Bill C-32. One
of my colleagues will deal with the excise tax in the area of
tobacco. I intend to cover air transportation and the goods and
services tax. I certainly will do that in the next seven minutes.
What I would like to say first deals with air transportation tax.
We have to deal with the principle that we should pay as we go.
We should look at crown corporations and the aviation industry.
If we believe there is a sound principle that we should pay as we
go and as customers of the service, we should support the tax and
the formula that are in place. We should support the fact that the
ceiling has now been raised to $50. We are going to bring in
some $20 million more in the current fiscal year and another $40
million in the next fiscal year and try to reduce the deficit in the
transportation system.
I understand that currently it costs around $780 million to run
the aviation section of the Department of Transport and we take
in some $600 million. There is a deficit. Through this change of
policy the minister is attempting to move the program to a point
where it is on the basis of pay as we go. We in the Reform Party
support that. We feel very strongly about that.
I listened to the Bloc Quebecois member who has just taken
his seat make the case that we have to worry about the increased
cost of tickets. That is certainly a matter we could worry about
but if we believe in the principle that we pay as we go, the sort of
welfare dependent attitude portrayed by the Bloc Quebecois
member just does not hold water.
(1810)
As Canadians we must start to change our principles and to
change our attitudes. It is changing in the nineties. We must
move from the attitude of the seventies and eighties where we
believed government had to do everything for us. We became
dependent on government. We believed government had to
subsidize a variety of services that we were using as private
individuals, as businesses and as companies.
We have to move away from the 1970 and 1980 mentality of
the welfare state and start to move toward a more conservative
attitude where people must be responsible for looking after their
own welfare. People must be prepared to pay their bills, whether
travelling on Air Canada, Canadian Air or any other charter
airline in our country. People who wish to travel must make that
part of the cost of our lives on a private basis and part of the cost
of our business. If we as members of government have to travel
4611
or if members of the public service have to travel then it is a
budgeting cost in this assembly.
The bill is more than a change in policy with regard to
increasing the revenue available to the Minister of Transport.
We are moving over the threshold in the attitude we have as
Canadian governments. I hear it in the House sometimes. I
would like to hear it more. We talk about governments being
independent, being able to run on their own and being able to
pay their way. We are starting to move away from agencies,
particularly large corporations or companies that get grants
from government and become dependent on government, to a
point at which people are more independent in the way they
behave, in the way they act and in the way they respect public
funds.
That primary principle is starting to expose itself and to
become more obvious in this piece of legislation. I certainly
commend the minister for supporting it in this piece of
legislation. I highly recommend to the government that as we
are planning for the 1995-96 budget we should look at ways and
means the government can move away from creating dependent
circumstance or agencies of government that are very dependent
on public funds, to a point where the agencies or in many
circumstances the private elements of our society look after
themselves.
A primary item the government must look at for the upcoming
budget is the Canadian Broadcasting Corporation and the same
principle. We subsidize that corporation by $1.1 billion a year. It
is asking in another piece of legislation-and I know I am
walking close to the edge of the rules by referencing another
piece of legislation-for $25 million of borrowing power to
support its organization. Whether it borrows more money or
receives it as a grant from government, the public purse is
supporting that agency. It is creating a dependency within our
Canadian community and it is wrong.
I highlight that my support and the support of the Reform
Party for the section on air transportation tax in Bill C-32
changes a direction and makes the industry more independent
and self-sufficient. If we want to move a number of our airports
into private management components, I believe this is a start. If
we can show-
(1815)
The Deputy Speaker: If the hon. member would excuse the
Chair, there was a misunderstanding. The debate goes on until
6.30, not until 6.15. He is entitled to go on until 6.30 or he might
wish to yield the floor to somebody else.
Mr. Speaker (Lethbridge): Mr. Speaker, I certainly
appreciate the extra time which is available to me in this debate.
The second principle in the bill I want to talk about concerns
the GST changes for meal allowances. It reduces the amount
from 80 per cent to 50 per cent that can be calculated as
entertainment or meal allowances for those persons wishing to
use it in their tax calculations.
We have supported that change on the basis we felt this was a
business subsidy. The Reform Party is very concerned that
government should get out of business. Government is too far
into the lives of the business community. For those people who
wish to entertain potential clients with meals or other types of
entertainment expenses then that should be their responsibility.
It should not be the responsibility of the state to subsidize them
indirectly with a tax concession. On that basis we support that
type of change with regard to the goods and services input tax
credit.
Those were the two areas I wanted to speak on. The Reform
Party supports each of them. First, we support the transportation
tax changes which make the industry more self sufficient and
not so reliant on the subsidy of the public purse. Second, we
support the reduction or changes in the GST allowance tax credit
from 80 per cent to 50 per cent. It is a good move in that
government is less involved and the private sector looks after
itself.
Mr. Bob Speller (Haldimand-Norfolk): Mr. Speaker, I will
just take a couple of minutes to talk about that. I cannot let a bill
like this get passed in this House without first telling the House
about the effects it has on my riding. When I talked about this
bill before I explained to the House how important legislation
like this is to my riding of Haldimand-Norfolk.
I represent somewhere in the neighbourhood of 800 tobacco
producers and I have represented them on this issue over the past
few years. Over a number of years I and indeed a number of
members in this House have been calling for the government to
reduce taxes on tobacco. We felt, as do most of my constituents,
that tobacco taxes and the way they have been applied in this
country have been to the detriment of many of my constituents
certainly the tobacco farmers and the area communities which
support them.
I also represent the people of the Six Nations which is the
largest Indian reserve in the country. It was dramatically
impacted on by this legislation and the lowering of the taxes we
brought in earlier this year, in February.
One thing we have seen in Haldimand-Norfolk and in the
area surrounding the Six Nations is a great reduction in the
number of smoke huts. Prior to the dropping of the taxes there
were in the neighbourhood of 150 tobacco huts. Today it is very
difficult to find one or two on the reserves. Some of them are
now dealing in commodities other than tobacco, more than
likely spirits of some sort, but it certainly has had a dramatic
impact in that area.
4612
(1820)
It was the elders, the senior people of the Six Nations who
came to me most often and said: ``You have to deal with this
situation. We don't like what it is doing to our children. We don't
like the money aspect it has instilled in our children of going out
and trying to make a quick buck''. A lot of the time these elders
felt that the children were moving away from the old ways and
the old teachings by getting into this money grabbing exercise.
They certainly were very pleased by what this government has
done.
In the past I have talked about how taxation policy has been to
the detriment of the tobacco industry. It has been that way
because governments have not been able to give the
industry-when I talk about the industry, I talk about the
tobacco farmers-an idea of their taxation needs over the years.
Even though there is a marketing system for tobacco, when
the numbers came out as to what the tobacco requirements
would be for a year the government would come in later and all
of a sudden apply a high tax on tobacco which would completely
throw the market into an upheaval. That is why over the years I
have been calling for the reduction in taxation on tobacco.
There is a major relief for the people in the tobacco growing
areas. It has helped the spirit in those areas. They are good
people who had been encouraged by past governments to get
into tobacco. These people really do not have a number of other
commodities to move into. These are good Canadians who in the
past have supported good government. Over the past few months
when I have been down there visiting with them they have
praised the government for what it has been doing.
Constituents have not been happy with other areas of the bill.
The export tax is one they see as not only against any provisions
in GATT but also something that would hurt their legitimate
export interests. They have called on me to tell the government,
as I have in the past, that an export tax only hurts Canadian jobs
and Canadian farmers. It does nothing to solve the problem.
We have gone beyond that. Because of the dramatic drop in
taxation we have gone on to solve the problem. It was a tough
problem. I listened earlier to the member from the Bloc saying:
``Gee, why didn't you do something about it?'' I remember when
his leader was in the previous government which kept raising the
taxes on tobacco. Why was it that his leader did nothing to deal
with this situation?
We came in and there was a major problem. Maybe some
people in the Reform Party and in the west did not agree with
some of the things we did. It was not an easy problem but one
which I suppose past governments had decided it best to just let
go. Our leader decided to take it upon himself to solve this
problem. From all I have seen, it has solved the problem in my
area.
Some will complain that right after we brought in the new
taxation the sales of tobacco went up, but that was just the
situation of people resupplying. If members went into
cornerstores in their ridings they could see people were moving
out of tobacco sales because they were not making any money on
it. People were buying their tobacco outside their normal
channels.
We saw in the paper a couple of weeks ago when the numbers
came out that those numbers have dropped dramatically. In fact,
we are now seeing there really is not a dramatic drop. It is pretty
much staying the same in terms of tobacco sales. There has not
been the dramatic increase some claimed would happen and all
in all, it is levelling off.
(1825)
It has brought to people's attention that serious problem of
how tobacco was illegally getting into the hands of young people
in schoolyards. This bill makes sure that if people buy tobacco
products they will do it legitimately in legitimate areas. If
someone decides to sell to minors they will face the stiffest
penalties there have ever been in this country in that regard.
That is good government. It is a good piece of legislation
which deals with a problem Canadians wanted dealt with. It
bodes well for not only the Prime Minister but also for the
Minister of Health and the Minister of National Revenue who
solved the problem together.
I will give the Reform Party a chance for five minutes on this.
I thank the Prime Minister on behalf of my constituents in
Haldimand-Norfolk for dealing with the problem.
Mr. Garry Breitkreuz (Yorkton-Melville): Mr. Speaker, I
have only a few minutes but I want to make several points. I was
going to take the opportunity to go through Bill C-32 point by
point, but time does not allow that. I will simply summarize
what our position is and then make a few supplementary
remarks.
Reformers are going to come out opposed to this bill basically
because we did not want the tobacco tax to be reduced in the way
it was. You may find it rather surprising that Reformers would
oppose a tax reduction. One of the reasons we were elected was
to reduce government spending so that taxes could be reduced
but in this case, we cannot agree with what has been done for the
following reasons.
My constituents have told me this as well. They did not like
the way the government responded to the criminal element by
reducing taxes very quickly. They would have preferred that the
government look at the enforcement problem first and address
some of the other issues, maybe apply an excise tax on the
exported tobacco products.
4613
More and more people will be encouraged to smoke. We
already see this happening among our young people. For this
reason we cannot support this reduction in the tax.
Because of this increase in smoking we will have long term
health costs for Canadians which have not been factored in. The
government should have done some planning in this regard,
some investigation as to how this would affect our health care
system. That is a priority with people. They have told us that
above all else we should preserve our health care system. We
should not cut back on costs and this will probably increase the
costs rather than reduce them.
We should also have tried more aggressive enforcement
measures. Seventy per cent of the cigarettes were brought in
through the reserves. Maybe there was a way to address that
problem.
We would have liked to have seen a new export tax on tobacco
products tried before the lowering of taxes took place. We could
probably have worked together with Americans in this regard
but now they look at us and say: ``The Canadians have reduced
their taxes, so we don't have to increase ours. It doesn't work''.
There will also be a problem between provinces. There is a
smuggling problem between Canada and the United States and
now we are going to have a smuggling problem among various
provinces. How will that be addressed? What will happen in that
regard? I realize some measures have been taken here to try to
control that, but it could be a problem.
In February when Bill C-11 was introduced we pointed out
that when the criminal element sees that the profit is no longer
there for tobacco they will turn to other things. As my colleague
has already admitted, they will probably begin importing
alcohol and other things.
We support the imposition of the new excise tax on exported
tobacco products. Senior officials informed us that before the
tax changes were implemented, between 30 and 40 per cent of
the total production of tobacco manufacturing in Canada was
exported. The tobacco companies now agree that only 3 per cent
was legally consumed in the United States. This shows the
extent of the smuggling problem. It could have been controlled
at this end before it even went to the states.
This law now allows tobacco manufacturers to export 3 per
cent of their production tax exempt. Reformers believe that this
new export tax should have been tried before lowering the tax.
The legislation implements measures to ensure that unmarked
tobacco products sold to Indians on reserves in Ontario and
Nova Scotia are taxed at the same rate as marked tobacco
products sold in the two provinces.
Also retailers and wholesalers are owed an estimated $150
million in rebates on excise taxes on tobacco products held in
inventory when the excise tax was reduced. The minister cannot
issue the rebate cheques until this legislation is passed. While
we oppose the reduction in tobacco taxes, retailers are likely to
get upset if we delay the bill. We do not want to hold it up for that
reason.
Finally, Reformers support the adjustment to the fines for
illegal possession or sale of unstamped tobacco products. We
believe that those who are breaking our laws should be
punished. We also support the health promotion surtax, an
increase of 40 per cent of taxes paid on profits by the tobacco
manufacturers. We feel this is a positive measure. On most of
these measures we support the government. However, on the
reduction of the tobacco tax we cannot support it.
The Deputy Speaker: Is the House ready for the question?
Some hon. members: Question.
The Deputy Speaker: Is it the pleasure of the House to adopt
the motion?
Some hon. members: Agreed.
Some hon. members: On division.
(Motion agreed to, bill read the second time and referred to a
committee.)
The Deputy Speaker: It being 6.30 p.m., pursuant to
Standing Order 45(5)(a), the House will now proceed to the
taking of the deferred divisions on the motions at report stage of
Bill C-17, an act to amend certain statutes to implement certain
provisions of the budget tabled in Parliament on February 22,
1994.
* * *
The House resumed consideration of Bill C-17, an act to
amend certain statutes to implement certain provisions of the
budget tabled in Parliament on February 22, 1994, as reported
(without amendment) from the committee.
The Deputy Speaker: Call in the members.
(1850)
And the bells having rung:
The Deputy Speaker: The first vote is on Motion No. 1. A
vote on this motion also applies to Motions Nos. 2, 3, 5, 6, 7, 8,
9, 10 and 11. An affirmative vote on Motion No. 1 obviates the
necessity of putting the question on Motion No. 4. If Motion No.
1 is negatived Motion No. 4 will be voted on.
The question is on Motion No. 1.
(The House divided on the motion, which was negatived on
the following division:)
4614
(Division No. 43)
YEAS
Members
Bachand
Bellehumeur
Bernier (Gaspé)
Bouchard
Brien
Bélisle
Chrétien (Frontenac)
Dalphond-Guiral
Daviault
Debien
de Jong
de Savoye
Deshaies
Dubé
Duceppe
Dumas
Fillion
Gagnon (Québec)
Gauthier (Roberval)
Godin
Guimond
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lebel
Lefebvre
Leroux (Shefford)
Loubier
Marchand
Mercier
Picard (Drummond)
Plamondon
Péloquin
Sauvageau
Tremblay (Rosemont)-36
NAYS
Members
Ablonczy
Adams
Alcock
Anawak
Anderson
Assad
Assadourian
Axworthy (Winnipeg South Centre)
Barnes
Bellemare
Berger
Bertrand
Bethel
Bevilacqua
Bodnar
Bonin
Boudria
Breitkreuz (Yellowhead)
Breitkreuz (Yorkton-Melville)
Bridgman
Brown (Oakville-Milton)
Brushett
Bryden
Bélair
Calder
Campbell
Cannis
Catterall
Cauchon
Chamberlain
Chatters
Clancy
Cohen
Collenette
Comuzzi
Cowling
Crawford
Culbert
DeVillers
Dhaliwal
Dingwall
Discepola
Dromisky
Duhamel
Duncan
Dupuy
Easter
Fewchuk
Finlay
Fontana
Frazer
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Gilmour
Gouk
Gray (Windsor West)
Grey (Beaver River)
Grose
Grubel
Guarnieri
Hanger
Hanrahan
Harb
Harper (Calgary West)
Harper (Churchill)
Harper (Simcoe Centre)
Harvard
Hermanson
Hickey
Hill (Macleod)
Hubbard
Ianno
Iftody
Jackson
Jordan
Karygiannis
Kerpan
Keyes
Kilger (Stormont-Dundas)
Kirkby
Knutson
Kraft Sloan
Lavigne (Verdun-Saint-Paul)
LeBlanc (Cape Breton Highlands-Canso)
Lee
MacLaren (Etobicoke North)
MacLellan (Cape Breton-The Sydneys)
Maheu
Malhi
Maloney
Manley
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McClelland (Edmonton Southwest)
McCormick
McGuire
McKinnon
McLellan (Edmonton Northwest)
McTeague
McWhinney
Meredith
Mifflin
Milliken
Mills (Broadview-Greenwood)
Minna
Mitchell
Morrison
Murphy
Murray
O'Brien
O'Reilly
Pagtakhan
Parrish
Payne
Peric
Peterson
Pickard (Essex-Kent)
Pillitteri
Ramsay
Reed
Richardson
Rideout
Ringma
Ringuette-Maltais
Rock
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Silye
Simmons
Skoke
Speaker
Speller
St. Denis
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Torsney
Ur
Valeri
Vanclief
Walker
Wells
Whelan
White (Fraser Valley West)
Wood
Young
Zed-156
PAIRED-MEMBERS
Members
Arseneault
Asselin
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Blondin-Andrew
Canuel
Caron
Cauchon
Chan
Crête
Eggleton
English
Finestone
Gauthier (Ottawa-Vanier)
Godfrey
Goodale
Guay
Jacob
Laurin
Leblanc (Longueuil)
Leroux (Richmond-Wolfe)
MacAulay
Ménard
Nault
Nunez
Paré
Patry
Peters
Phinney
Pomerleau
Proud
Robichaud
Rompkey
St-Laurent
Tremblay (Rimouski-Témiscouata)
Venne
(1900 )
The Deputy Speaker: I declare Motion No. 1 negatived.
Therefore Motions Nos. 2, 3, 5, 6, 7, 8, 9, 10 and 11 are also
negatived.
The next question will be on Motion No. 4.
(The House divided on the motion, which was negatived on
the following division:)
(Division No. 44)
YEAS
Members
Ablonczy
Bachand
Bellehumeur
Bernier (Gaspé)
Bouchard
Breitkreuz (Yellowhead)
Breitkreuz (Yorkton-Melville)
Bridgman
Brien
Bélisle
Chatters
Chrétien (Frontenac)
Dalphond-Guiral
Daviault
Debien
de Jong
de Savoye
Deshaies
Dubé
Duceppe
4615
Dumas
Duncan
Fillion
Frazer
Gagnon (Québec)
Gauthier (Roberval)
Gilmour
Godin
Gouk
Grey (Beaver River)
Grubel
Guimond
Hanger
Hanrahan
Harper (Calgary West)
Harper (Simcoe Centre)
Hermanson
Hill (Macleod)
Kerpan
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lebel
Lefebvre
Leroux (Shefford)
Loubier
Marchand
McClelland (Edmonton Southwest)
Mercier
Meredith
Morrison
Picard (Drummond)
Plamondon
Péloquin
Ramsay
Ringma
Sauvageau
Silye
Speaker
Tremblay (Rosemont)
White (Fraser Valley West)-62
NAYS
Members
Adams
Alcock
Anawak
Anderson
Assad
Assadourian
Axworthy (Winnipeg South Centre)
Barnes
Bellemare
Berger
Bertrand
Bethel
Bevilacqua
Bodnar
Bonin
Boudria
Brown (Oakville-Milton)
Brushett
Bryden
Bélair
Calder
Campbell
Cannis
Catterall
Cauchon
Chamberlain
Clancy
Cohen
Collenette
Comuzzi
Cowling
Crawford
Culbert
DeVillers
Dhaliwal
Dingwall
Discepola
Dromisky
Duhamel
Dupuy
Easter
Fewchuk
Finlay
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Gray (Windsor West)
Grose
Guarnieri
Harb
Harper (Churchill)
Harvard
Hickey
Hubbard
Ianno
Iftody
Jackson
Jordan
Karygiannis
Keyes
Kilger (Stormont-Dundas)
Kirkby
Knutson
Kraft Sloan
Lavigne (Verdun-Saint-Paul)
LeBlanc (Cape Breton Highlands-Canso)
Lee
MacLaren (Etobicoke North)
MacLellan (Cape Breton-The Sydneys)
Maheu
Malhi
Maloney
Manley
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McCormick
McGuire
McKinnon
McLellan (Edmonton Northwest)
McTeague
McWhinney
Mifflin
Milliken
Mills (Broadview-Greenwood)
Minna
Mitchell
Murphy
Murray
O'Brien
O'Reilly
Pagtakhan
Parrish
Payne
Peric
Peterson
Pickard (Essex-Kent)
Pillitteri
Reed
Richardson
Rideout
Ringuette-Maltais
Rock
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
SimmonsSkoke
Speller
St. Denis
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Torsney
Ur
Valeri
Vanclief
Walker
Wells
Whelan
Wood
Young
Zed-130
PAIRED-MEMBERS
Arseneault
Asselin
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Blondin-Andrew
Canuel
Caron
Cauchon
Chan
Crête
Eggleton
English
Finestone
Gauthier (Ottawa-Vanier)
Godfrey
Goodale
Guay
Jacob
Laurin
Leblanc (Longueuil)
Leroux (Richmond-Wolfe)
MacAulay
Ménard
Nault
Nunez
Paré
Patry
Peters
Phinney
Pomerleau
Proud
Robichaud
Rompkey
St-Laurent
Tremblay (Rimouski-Témiscouata)
Venne
(1910)
[Translation]
The Deputy Chairman: I declare Motion No. 4 negatived.
[English]
Mr. Gagliano: Mr. Speaker, I believe you will find
unanimous consent to apply the result of Motion No. 4 to Motion
No. 12 and to apply the result of Motion No. 1 to Motion No. 13.
The Deputy Speaker: Is there unanimous consent?
Some hon. members: Agreed.
The Deputy Speaker: Accordingly, Motion No. 12 is also
negatived. Motions Nos. 13, 14 and 15 I believe are also
negatived.
[Editor's Note: See list under Division No. 44 for Motion No.
12. See list under Division List No. 43 for Motion No. 13.]
The Deputy Speaker: The next question is on Motion No. 19.
A vote on this motion also applies to Motions Nos. 20 and 22.
[Translation]
An affirmative vote on Motion No. 19 obviates the need for a
vote on Motion No. 21. If Motion No. 19 is negatived, Motion
No. 21 will be voted on.
4616
[English]
(The House divided on the motion, which was negatived on
the following division:)
(Division No. 45)
YEAS
Members
Ablonczy
Breitkreuz (Yellowhead)
Breitkreuz (Yorkton-Melville)
Bridgman
Chatters
Duncan
Frazer
Gilmour
Gouk
Grey (Beaver River)
Grubel
Hanger
Hanrahan
Harper (Calgary West)
Harper (Simcoe Centre)
Hermanson
Hill (Macleod)
Kerpan
McClelland (Edmonton Southwest)
Meredith
Morrison
Ramsay
Ringma
Silye
Speaker
White (Fraser Valley West)-26
NAYS
Members
Adams
Alcock
Anawak
Anderson
Assad
Assadourian
Axworthy (Winnipeg South Centre)
Bachand
Barnes
Bellehumeur
Bellemare
Berger
Bernier (Gaspé)
Bertrand
Bethel
Bevilacqua
Bodnar
Bonin
Bouchard
Boudria
Brien
Brown (Oakville-Milton)
Brushett
Bryden
Bélair
Bélisle
Calder
Campbell
Cannis
Catterall
Cauchon
Chamberlain
Chrétien (Frontenac)
Clancy
Cohen
Collenette
Comuzzi
Cowling
Crawford
Culbert
Dalphond-Guiral
Daviault
Debien
de Jong
de Savoye
Deshaies
DeVillers
Dhaliwal
Dingwall
Discepola
Dromisky
Dubé
Duceppe
Duhamel
Dumas
Dupuy
Easter
Fewchuk
Fillion
Finlay
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gagnon (Québec)
Gallaway
Gauthier (Roberval)
Gerrard
Godin
Gray (Windsor West)
Grose
Guarnieri
Guimond
Harb
Harper (Churchill)
Harvard
Hickey
Hubbard
Ianno
Iftody
Jackson
Jordan
Karygiannis
Keyes
Kilger (Stormont-Dundas)
Kirkby
Knutson
Kraft Sloan
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lavigne (Verdun-Saint-Paul)
Lebel
LeBlanc (Cape Breton Highlands-Canso)
Lee
Lefebvre
Leroux (Shefford)
Loubier
MacLaren (Etobicoke North)
MacLellan (Cape Breton-The Sydneys)
Maheu
Malhi
Maloney
Manley
Marchand
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McCormick
McGuire
McKinnon
McLellan (Edmonton Northwest)
McTeague
McWhinney
Mercier
Mifflin
Milliken
Mills (Broadview-Greenwood)
Minna
Mitchell
Murphy
Murray
O'Brien
O'Reilly
Pagtakhan
Parrish
Payne
Peric
Peterson
Picard (Drummond)
Pickard (Essex-Kent)
Pillitteri
Plamondon
Péloquin
Reed
Richardson
Rideout
Ringuette-Maltais
Rock
Sauvageau
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
Speller
St. Denis
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Torsney
Tremblay (Rosemont)
Ur
Valeri
Vanclief
Walker
Wells
Whelan
Wood
Young
Zed-166
PAIRED-MEMBERS
Members
Arseneault
Asselin
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Blondin-Andrew
Canuel
Caron
Cauchon
Chan
Crête
Eggleton
English
Finestone
Gauthier (Ottawa-Vanier)
Godfrey
Goodale
Guay
Jacob
Laurin
Leblanc (Longueuil)
Leroux (Richmond-Wolfe)
MacAulay
Ménard
Nault
Nunez
Paré
Patry
Peters
Phinney
Pomerleau
Proud
Robichaud
Rompkey
St-Laurent
Tremblay (Rimouski-Témiscouata)
Venne
(1915 )
The Deputy Speaker: I declare Motion No. 19 defeated.
[Translation]
I declare Motions Nos. 20 and 22 negatived.
[English]
The next question is on Motion No. 21.
[Translation]
Mr. Gagliano: Mr. Speaker, I think you will find unanimous
consent in the Chamber to apply the vote on Motion No. 4 to
Motion No. 21.
(1920)
The Deputy Speaker: Does the House agree?
Some hon. members: Agreed.
The Deputy Speaker: Agreed.
[English]
Accordingly Motion No. 21 is also negatived.
[Editor's Note: See list under Division No. 44.]
4617
[Translation]
The Deputy Speaker: The next vote will be on Motion No. 23
and will also apply to Motions Nos. 27, 28, 29, 30, 32, 34, 35, 36,
37 and 38.
[English]
An affirmative vote on Motion No. 23 obviates the need for a
vote on Motions Nos. 24, 25, 26, 31 and 33. A negative vote on
Motion No. 23 necessitates a vote on Motions Nos. 24, 26, 31
and 33.
[Translation]
The vote on Motion No. 24 will also apply to Motion No. 25.
[English]
Motions Nos. 26, 31 and 33 will be voted on separately.
All those in favour of the motion will please rise.
Does the proposer and his team party wish to rise in favour of
this motion or not? Then all those opposed to the motion will be
please rise.
[Translation]
(The House divided on the motion, which was negatived on
the following division:)
(Division No. 46)
YEAS
Members
nil/aucun
NAYS
Members
Ablonczy
Adams
Alcock
Anawak
Anderson
Assad
Assadourian
Axworthy (Winnipeg South Centre)
Bachand
Barnes
Bellehumeur
Bellemare
Berger
Bernier (Gaspé)
Bertrand
Bethel
Bevilacqua
Bodnar
Bonin
Bouchard
Boudria
Breitkreuz (Yellowhead)
Breitkreuz (Yorkton-Melville)
Bridgman
Brien
Brown (Oakville-Milton)
Brushett
Bryden
Bélair
Bélisle
Calder
Campbell
Cannis
Catterall
Cauchon
Chamberlain
Chatters
Chrétien (Frontenac)
Clancy
Cohen
Collenette
Comuzzi
Cowling
Crawford
Culbert
Dalphond-Guiral
Daviault
Debien
de Jong
de Savoye
Deshaies
DeVillers
Dhaliwal
Dingwall
Discepola
Dromisky
Dubé
Duceppe
Duhamel
Dumas
Duncan
Dupuy
Easter
Fewchuk
Fillion
Finlay
Fontana
Frazer
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gagnon (Québec)
Gallaway
Gauthier (Roberval)
Gerrard
Gilmour
Godin
Gouk
Gray (Windsor West)
Grey (Beaver River)
Grose
Grubel
Guarnieri
Guimond
Hanger
Hanrahan
Harb
Harper (Calgary West)
Harper (Churchill)
Harper (Simcoe Centre)
Harvard
Hermanson
Hickey
Hill (Macleod)
Hubbard
Ianno
Iftody
Jackson
Jordan
Karygiannis
Kerpan
Keyes
Kilger (Stormont-Dundas)
Kirkby
Knutson
Kraft Sloan
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lavigne (Verdun-Saint-Paul)
Lebel
LeBlanc (Cape Breton Highlands-Canso)
Lee
Lefebvre
Leroux (Shefford)
Loubier
MacLaren (Etobicoke North)
MacLellan (Cape Breton-The Sydneys)
Maheu
Malhi
Maloney
Manley
Marchand
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McClelland (Edmonton Southwest)
McCormick
McGuire
McKinnon
McLellan (Edmonton Northwest)
McTeague
McWhinney
Mercier
Meredith
Mifflin
Milliken
Mills (Broadview-Greenwood)
Minna
Mitchell
Morrison
Murphy
Murray
O'Brien
O'Reilly
Pagtakhan
Parrish
Payne
Peric
Peterson
Picard (Drummond)
Pickard (Essex-Kent)
Pillitteri
Plamondon
Péloquin
Ramsay
Reed
Richardson
Rideout
Ringma
Ringuette-Maltais
Rock
Sauvageau
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Silye
Simmons
Skoke
Speaker
Speller
St. Denis
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Torsney
Tremblay (Rosemont)
Ur
Valeri
Vanclief
Walker
Wells
Whelan
White (Fraser Valley West)
Wood
Young
Zed-192
PAIRED-MEMBERS
Arseneault
Asselin
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Blondin-Andrew
Canuel
Caron
Cauchon
Chan
Crête
Eggleton
English
Finestone
Gauthier (Ottawa-Vanier)
Godfrey
Goodale
Guay
Jacob
Laurin
Leblanc (Longueuil)
Leroux (Richmond-Wolfe)
MacAulay
Ménard
Nault
Nunez
Paré
Patry
Peters
Phinney
Pomerleau
Proud
Robichaud
Rompkey
St-Laurent
Tremblay (Rimouski-Témiscouata)
Venne
(1925)
[English]
The Deputy Speaker: I declare Motion No. 23 defeated. I
declare Motions Nos. 27, 28, 29, 30, 32, 34, 35, 36, 37 and 38
negatived.
4618
Mr. Gagliano: Mr. Speaker after the unanimous vote I
believe you could find unanimous consent to apply the vote on
Motion No. 1 to Motions Nos. 24, 26, 31 and 33.
Some hon. members: Agreed.
The Deputy Speaker: Accordingly Motions No. 24, 26, 31
and 33 are all negatived.
[Editor's Note: See list under Division No. 43.]
Mr. Gagliano: While I am on my feet I believe you will find
unanimous consent to apply in reverse the result on Motion No.
4 to the motion to concur in the bill at report stage.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
Hon. Paul Martin (Minister of Finance) moved that the bill
be concurred in.
Mr. Hermanson: Mr. Speaker, we agreed on that vote but we
are opposed at report stage. We would want to vote at report
stage that we are opposed to the bill.
The Deputy Speaker: We will apply the vote on Motion No. 4
in reverse. Is that acceptable to the House leader of the Reform
Party?
Mr. Hermanson: Yes.
(The House divided on the motion, which was agreed to on the
following division:)
(Division No. 47)
YEAS
Members
Adams
Alcock
Anawak
Anderson
Assad
Assadourian
Axworthy (Winnipeg South Centre)
Barnes
Bellemare
Berger
Bertrand
Bethel
Bevilacqua
Bodnar
Bonin
Boudria
Brown (Oakville-Milton)
Brushett
Bryden
Bélair
Calder
Campbell
Cannis
Catterall
Cauchon
Chamberlain
Clancy
Cohen
Collenette
Comuzzi
Cowling
Crawford
Culbert
DeVillers
Dhaliwal
Dingwall
Discepola
Dromisky
Duhamel
Dupuy
Easter
Fewchuk
Finlay
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Gray (Windsor West)
Grose
Guarnieri
Harb
Harper (Churchill)
Harvard
Hickey
Hubbard
Ianno
Iftody
Jackson
Jordan
Karygiannis
Keyes
Kilger (Stormont-Dundas)
Kirkby
Knutson
Kraft Sloan
Lavigne (Verdun-Saint-Paul)
LeBlanc (Cape Breton Highlands-Canso)
Lee
MacLaren (Etobicoke North)
MacLellan (Cape Breton-The Sydneys)
Maheu
Malhi
Maloney
Manley
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McCormick
McGuire
McKinnon
McLellan (Edmonton Northwest)
McTeague
McWhinney
Mifflin
Milliken
Mills (Broadview-Greenwood)
Minna
Mitchell
Murphy
Murray
O'Brien
O'Reilly
Pagtakhan
Parrish
Payne
Peric
Peterson
Pickard (Essex-Kent)
Pillitteri
Reed
Richardson
Rideout
Ringuette-Maltais
Rock
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
Speller
St. Denis
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Torsney
Ur
Valeri
Vanclief
Walker
Wells
Whelan
Wood
Young
Zed-130
NAYS
Members
Ablonczy
Bachand
Bellehumeur
Bernier (Gaspé)
Bouchard
Breitkreuz (Yellowhead)
Breitkreuz (Yorkton-Melville)
Bridgman
Brien
Bélisle
Chatters
Chrétien (Frontenac)
Dalphond-Guiral
Daviault
Debien
de Jong
de Savoye
Deshaies
Dubé
Duceppe
Dumas
Duncan
Fillion
Frazer
Gagnon (Québec)
Gauthier (Roberval)
Gilmour
Godin
Gouk
Grey (Beaver River)
Grubel
Guimond
Hanger
Hanrahan
Harper (Calgary West)
Harper (Simcoe Centre)
Hermanson
Hill (Macleod)
Kerpan
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lebel
Lefebvre
Leroux (Shefford)
Loubier
Marchand
McClelland (Edmonton Southwest)
Mercier
Meredith
Morrison
Picard (Drummond)
Plamondon
Péloquin
Ramsay
Ringma
Sauvageau
Silye
Speaker
Tremblay (Rosemont)
White (Fraser Valley West)-62
PAIRED-MEMBERS
Arseneault
Asselin
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Blondin-Andrew
Canuel
Caron
Cauchon
Chan
Crête
Eggleton
English
Finestone
Gauthier (Ottawa-Vanier)
Godfrey
Goodale
Guay
Jacob
Laurin
Leblanc (Longueuil)
Leroux (Richmond-Wolfe)
MacAulay
Ménard
Nault
Nunez
Paré
Patry
Peters
Phinney
Pomerleau
Proud
Robichaud
Rompkey
St-Laurent
Tremblay (Rimouski-Témiscouata)
Venne
The Deputy Speaker: It being 7.30 p.m. the House stands
adjourned until tomorrow at 10 a.m.
(The House adjourned at 7.30 p.m.)