CONTENTS
Monday, April 24, 1995
The Acting Speaker (Mr. Kilger) 11649
Bill C-263. Consideration resumed of motion forsecond reading 11649
(Motion agreed to.) 11649
Division on motion deferred 11656
(The sitting of the House was suspended at 11.52 a.m.) 11656
The House resumed at 12 o'clock. 11656
Bill C-69. Consideration resumed of motion forthird reading. 11656
Mr. Harper (Calgary West) 11660
Mr. Harper (Calgary West) 11665
Division on motion deferred 11669
Bill C-75. Motion for second reading 11669
Mr. Chrétien (Frontenac) 11670
Mr. Gagnon (Bonaventure-Îles-de-la-Madeleine) 11674
Mr. Harper (Simcoe Centre) 11675
Mr. Chrétien (Saint-Maurice) 11675
Mr. Chrétien (Saint-Maurice) 11676
Mr. Chrétien (Saint-Maurice) 11676
Mr. Chrétien (Saint-Maurice) 11678
Mr. Chrétien (Saint-Maurice) 11678
Mr. Speaker (Lethbridge) 11678
Mr. Chrétien (Saint-Maurice) 11678
Mr. Speaker (Lethbridge) 11678
Mr. Chrétien (Saint-Maurice) 11678
Mr. Chrétien (Saint-Maurice) 11679
Mr. Chrétien (Saint-Maurice) 11679
Mrs. Tremblay (Rimouski-Témiscouata) 11679
Mrs. Tremblay (Rimouski-Témiscouata) 11680
Mr. Harper (Simcoe Centre) 11680
Mr. Harper (Simcoe Centre) 11680
Mr. White (Fraser Valley West) 11681
Mr. White (Fraser Valley West) 11681
Mr. Gauthier (Roberval) 11682
Mr. Gauthier (Roberval) 11682
Mr. Chrétien (Saint-Maurice) 11682
Mr. Chrétien (Saint-Maurice) 11683
Mr. Chrétien (Saint-Maurice) 11683
Motion for concurrence in 73rd report 11684
(Motion agreed to.) 11684
(Order discharged and motion withdrawn.) 11684
Bill C-75. Consideration of motion resumed 11688
Mr. Chrétien (Frontenac) 11688
(Motion agreed to, bill read the second time and referredto a committee.) 11699
Bill C-70. Motion for second reading 11699
Mr. Mills (Broadview-Greenwood) 11712
11649
HOUSE OF COMMONS
Monday, April 24, 1995
The House met at 11 a.m.
_______________
Prayers
_______________
[
English]
The Acting Speaker (Mr. Kilger): I have the honour to
inform the House that a message has been received from the
Senate informing this House that the Senate has passed Bill S-7,
an act to accelerate the use of alternative fuels for motor
vehicles.
_____________________________________________
PRIVATE MEMBERS' BUSINESS
[
English]
The House resumed from March 28 consideration of the
motion that Bill C-263, an act to amend the Financial
Administration Act and other acts in consequence thereof
(exempted crown corporations) be read the second time and
referred to a committee.
Mr. Don Boudria (Glengarry-Prescott-Russell, Lib.):
Mr. Speaker, I think you would find unanimous consent for the
following motion:
That notwithstanding any order of this House, any recorded division to be
taken on Bill C-263 later this day be deferred until Tuesday, April 25 at 5.30
p.m.
The Acting Speaker (Mr. Kilger): The House has heard the
terms of the motion. Is there unanimous consent?
Some hon. members: Agreed.
(Motion agreed to.)
The Acting Speaker (Mr. Kilger): When Bill C-263 was last
before the House the hon. member for St. Boniface had
approximately five minutes remaining in debate.
Mr. Ronald J. Duhamel (Parliamentary Secretary to
President of the Treasury Board, Lib.): Mr. Speaker, it is my
pleasure to continue my address on the bill presented by the hon.
member for Okanagan-Similkameen-Merritt. As previously
stated, I believe that the objectives of the bill are well intended.
My colleagues and I are in favour of ensuring adequate
accountability for all crown corporations. However, the
proposed bill has a number of shortcomings which I will
continue to review today.
The last time I spoke on the bill I examined some of the
reasons for exemptions. Exemptions reflect some of the very
special sensitivities in the relationship between the government
and these particular corporations. Each has been created by a
special act which carefully outlines a very specific mandate. For
some the act sets out requirements for the administration of
resources. This becomes of particular importance in ensuring
the accountability among these crown corporations which
provide, for example, grants. A case in point is the Canada
Council.
[Translation]
It is of paramount importance that the Canada Council be
permitted to freely select recipients of grants and that this be the
public's perception. I am of the opinion that the artistic value of
a work is not a political issue and that it is inappropriate for the
government to set conditions in this area.
[English]
Similarly, I believe strongly in protecting the mandated
freedom of the CBC in areas of programming and journalistic
independence. This freedom led to the provision that the CBC
also be exempted from part X in 1984.
I recognize that the hon. member deliberately left out the CBC
in order to remove, as much as possible, contentious issues. My
concern is that the reasons for granting exemption from part X
for other corporations, such as the Canadian Wheat Board,
present issues which may be viewed as equally contentious,
especially by Canadians or groups of Canadians these
corporations serve.
[Translation]
Should we not first hold comprehensive consultations with
the affected parties to examine these issues in depth?
[English]
It appears to me the bill fails to recognize as much as it should
that the unique mandates of the affected corporations require
more serious consideration in developing an appropriate
accountability framework.
11650
Clearly there are reasons for some of these corporations to be
agents rather than non-agents of the crown. There are also
reasons why their employees are not public servants. Bill
C-263, in my opinion, does not deal with the importance of
these reasons sufficiently clearly.
Experience over the last 10 years has shown that generally
there may be merit in bringing other corporations under a
modified form of accountability framework similar to the
regime now in place for the CBC. Bill C-263 does not provide
for these modifications which I believe are necessary.
I am confident that additional efforts will be made by this
government to balance improvements in accountability for
exempt crown corporations with the desirable degree of
independence. In fact, the bill assists us in doing this.
Owing to the reservations and inconsistencies in the approach
reflected in Bill C-263-and I do not say that unkindly because I
recognize that the hon. member did not have all of the resources
available to him-I must declare that I cannot recommend
support for this bill as presented in the House. However, I wish
to state that, notwithstanding my opposition to the bill, the
government is committed to sound financial management for all
of its crown corporations. Improvements can always be sought
and we will make them.
(1110 )
We recognize that the situation for the exempt crown
corporations named in the hon. member's bill is unique and that
the bill fails to adequately deal with that fact. This does not
mean that we are blindly opposed to a re-examination of how to
best ensure appropriate accountability.
The President of the Treasury Board will therefore
communicate with his colleagues responsible for these
corporations asking them to review once more the opportunities
to improve the accountability system now in place for each of
them. This examination process would be done on a case by case
basis respecting the special needs of each corporation's
mandate. It would include examining the need for changes to
legislation paralleling the model for CBC if appropriate.
There are several ways to deal with this. I am confident that in
partnership with the directors and managers of crown
corporations, the government will continue to demonstrate a
strong commitment to managing the corporations effectively
and efficiently with due regard for all of the best and most sound
principles of accountability to the taxpayer.
Mr. Dick Harris (Prince George-Bulkley Valley, Ref.):
Mr. Speaker, Bill C-263 ensures that the federal government is
accountable to the Canadian taxpayer. I feel strongly that
members from all sides of the House should rally in support of
Bill C-263 so that we can honestly say that we have tried to
respond to the wishes of the people who sent us here.
As members know, in the 1993 fiscal year crown corporations
incurred losses totalling some $57 million. Their net borrowing
from the Government of Canada amounted to $14.2 billion.
Crown corporations received $4.6 billion from government
through budgetary appropriations.
Our task in this Chamber is to ensure that every government
department and agency be accountable for every tax dollar
spent. I dare say that everyone in the House wants to be able to
say to the people at home that we are responsible to the people
who ultimately pay the bills: the Canadian taxpayer.
The auditor general has a key role to play in this regard. In
many cases, which I will refer to in a moment, the auditor
general has not only made available the exact facts and figures
concerning the activities and performance of the federal
government but the auditor general has been able to improve
such activities and performance levels by dissecting and
evaluating agencies and departments.
No shame is involved in the work performed by the auditor
general. The auditor's detection of poor performance and
recommendations is seen by Canadians as routine and to be
expected. Canadian firms large and small perform audits on
their activities and performance. Often audits show they are on
the right track with objectives and sometimes they must swallow
tough medicine to cure ailments detected in their business by
such audits.
This is a fact of life and it should apply to government as well.
Canadians expect their government to follow the good business
practices followed in the private sector.
No one can deny the performance of auditors general in recent
history. In fact progress has been made. The auditor general has
the power to follow up on his recommendations. The result has
been that in many cases Canadians are realizing better value for
their tax dollars because of the efforts of the auditor general.
With reforms instituted in 1984, most crown corporations
have operated within the accountability framework established
under part X of the Financial Administration Act. Part X of the
act requires each crown corporation to submit an annual report.
The annual report, in addition to its financial statement and the
auditor's report also presents information on how well the
objectives of the corporation were reached during the reporting
period. Second, crown corporations are expected to submit a
corporate plan and third, budget summaries for tabling in
Parliament. These are good measures. In my view these
requirements are basic and simple. They are not unreasonable
and yet we have a system in government in which crown
corporations are not required to do these basics.
11651
(1115)
Canadians expect their tax dollars to be spent within this
framework of accountability. When Canadians hear of money
being spent by the federal government without the above criteria
being met they become quite naturally suspicious.
There are good reasons for Canadians to feel this way. The
Financial Administration Act could easily be made applicable to
crown corporations listed in Bill C-263. There are 49 crown
corporations. Bill C-263 deals with five which are exempted
from the Financial Administration Act: the Canada Council, the
Canadian Film Development Board, Telefilm Canada, the
Canadian Wheat Board, the International Development
Research Centre and the National Arts Centre.
Bill C-263 would move these crown corporations under the
supervision of the auditor general. This is an absolute necessity
considering the amount of dollars consumed by these five
agencies.
The CBC is not included in Bill C-263. The reason for this is
that Canadian Broadcasting Corporation provisions for the
Financial Administration Act were incorporated into the
Broadcasting Act in 1991. In short, the CBC is already subject to
the accountability requirements of Bill C-263 and the Financial
Administration Act.
This latter point is important for members of the House to
note. The CBC is the recipient of about 70 per cent of all
government funding provided to crown corporations that are
exempt. This means Bill C-263 is finishing a job already
accomplished by Parliament. Since 1991 the CBC has adjusted
to the accountability requirements of part X of the Financial
Administration Act.
Hon. members may agree with my observation that the CBC,
more than any other exempt crown corporation in Bill C-263,
was most insistent about the idea of critical importance of an
arm's length relationship to the government. The CBC has not
had the difficulties it anticipated in adapting to these
accountability requirements. The CBC has been operating
within this framework for the last four years without too much
difficulty.
I remind colleagues that the auditor general already performs
financial audits on the five corporations in Bill C-263.
However, these audits do not permit the auditor general to
comment on the appropriateness of the activities of the five, nor
is the auditor able to comment on the extent to which each fulfils
its mandate.
As it stands now these are not value for money audits. This
must be a necessity for these five corporations. Value for money
audits are done every five years. They are different from annual
audits in that they comment on corporate management, goals
and objectives.
It is fair to say the boards of the exempt corporations should
welcome the value for money audits in much the same way
private sector enterprises welcome their annual audits in which
their forecasting and business plans come under the scrutiny of
their shareholders and an auditor.
It is not unthinkable that the board members would look on
the audits as helpful to their own work as well as a positive
accountability measure, something that has been missing in
many of these crown corporations within the framework of
government operations.
It has been 10 years since this accountability framework for
crown corporations was established. Exempt corporations have
now had a decade to review and analyse effects of the Financial
Administration Act on the independence of non-exempt crown
corporations. By now it is highly likely the crown corporations
exempted from the act would conclude that the Financial
Administration Act poses no real threat to them. The CBC is an
illustration of this. Provisions of the Financial Administration
Act were incorporated into the amended Broadcasting Act in
1991.
(1120)
It is reasonable to require the five crown corporations to
prepare a business plan so that annual reports can allow the
Canadian people, the taxpayers, the funders of these programs,
to monitor and gauge the performance of these five.
There have been some cases in which crown corporations'
annual reports differ from the business plan objectives, even
though there are no provisions for exempted crown corporations
to invite the auditor general to conduct special examinations.
The audit is released only to the board of directors, not to
Parliament. It must be released to Parliament. It must come
under the scrutiny of all members of Parliament so we can
ensure taxpayers' money is being accounted for.
Providing the corporations with the option of inviting the
auditor general to do an audit is not good enough. If the auditor
general's office were involved in the corporation on a regular
basis, business plan objectives would not deviate from
objectives stated in the annual report.
We all agree that in times of restraint such as we have now
those who spend taxpayers' dollars must be more aware than
ever that they are answerable as to how the dollars are spent.
Part X of the Financial Administration Act has been so effective
for other crown corporations, it seems reasonable, logical and
simply common sense to bring the five crown corporations
outlined in Bill C-263 into line as well. I urge all members of the
House to support Bill C-263.
Ms. Jean Augustine (Parliamentary Secretary to Prime
Minister, Lib.): Mr. Speaker, I am pleased to join the debate
today on Bill C-263, an act to amend the Financial Administra-
11652
tion Act, sponsored by the hon. member for
Okanagan-Similkameen-Merritt.
I as well endorse the objectives of the bill to increase the
accountability of exempt crown corporations to the taxpayers of
Canada. At the same time I have reservations that this proposal
is the best approach to the question.
Let me deal with the proposal to make the officers and
employees of the Canada Council, the National Arts Centre and
the International Development Research Council part of the
public service of Canada.
On February 27, 1995 the Minister of Finance introduced a
historic budget to the House. Part of the announcement was the
need to reduce the size of the public service by some 45,000
positions over the course of the next three years. That is a major
undertaking which will require a great deal of effort to manage
with both wisdom and compassion.
These three corporations have approximately 850 employees
combined; roughly 230 in the Canada Council and 280 in the
National Arts Centre and 340 in IDRC.
Adding 850 positions to the size of the public service at this
time is swimming against the current. For this reason, if for no
other, I cannot support the bill as presented to the House.
I share the point of view expressed early in the debate by the
hon. member for La Prairie that broad brush legislation of the
sort reflected in Bill C-263 is not the only approach that can be
taken to this issue. There are other approaches that can and have
been taken recently to strengthen the accountability of our
crown corporations.
One such approach is improving the quality of corporate
governance. I am referring to the role of the board of directors
whose responsibility it is, to put it simply, to manage the
mangers. In this respect I invite the attention of the House to the
final report of the Minister responsible for Public Service
Renewal and agency review released on February 16, 1995, the
same day as the budget.
(1125)
The purpose of the review announced in the February 1994
budget was to review the continuing usefulness and the currency
of the mandate of the federal government, several hundred
agencies, boards and commissions.
Among the measures adopted by the government in the final
report to streamline the appointment process were decisions to
reduce the size of the governing bodies of a number of agencies
including crown corporations.
Accountability for taxpayers' dollars is a key consideration
for these exempt corporations. In this regard it is worth noting
the review concluded reductions in governor in council
appointments will take place in three exempt corporations, two
of which are identified in this bill.
The board of governors of the CBC will be reduced from 15 to
12 members. The board of trustees of the National Arts Centre
would be downsized to eight members from the current eleven.
The governor in council position of secretary will be eliminated
in Telefilm Canada. The agency review taken as a whole will
result in the elimination of some 589 governor in council
appointments.
As well, the final report and agency review revamped the
tenure provisions of the appointment process which would make
it easier for the government to remove under performing
individuals holding full time appointments, including officers
of crown corporations appointed by the governor in council.
Incumbents of these positions will now serve at pleasure. The
government is committed to improving the appointment
process, including appointments to the board of directors of
crown corporations.
That is a commitment of the red book. Those were the
recommendations in the report commissioned by the Prime
Minister and submitted by Mr. Gérard Veilleux. ``Unfinished
Business, a Report on the Appointment Process to Boards of
Directors of Crown Corporations'', was released by the Minister
responsible for Public Service Renewal last July. That was the
focus of a conference held in October by the President of the
Treasury Board for the chairpersons and chief executive officers
of crown corporations.
The subject matter of that conference will perhaps reinforce
the message to the sponsor of this bill that there are other
avenues to improving the accountability regime for all crowns,
including the exempts beyond the legislative approach.
The October conference, ``Corporate Governance: Improving
the Effectiveness of Crown Corporation Board of Directors'',
sponsored four workshops for participants. The first of these
was on the development and approval of strategy.
This group explored the importance of the development and
approval of specific strategies, the challenge of linking the
development of strategy to the corporation's mandate, the
relationship of the board to management and the factors which
contribute to a board's success.
The second workshop was on the subject of board
composition and evaluation. Discussion in these groups centred
on the roles of the chairperson and the CEO, the selection and
evaluation of board members, the functioning of the
appointment process, board self-evaluation, the orientation and
education of directors and all related communications issues.
The third workshop dealt with balancing the corporate agenda
and the public good. Groups discussed the trade-offs between
meeting the commercial financial objectives and achieving the
11653
mandated public policy objectives, all within the constraints
imposed by the accountabilities of a public enterprise.
The final workshop addressed meeting the information needs
of the board. Participants examined the information needs of the
board from a variety of perspectives, including the often unique
perspectives of the exempt crown corporations referred to in
Bill C-263.
Work is continuing in these areas. Options for an education
program for newly appointed directors of crown corporations
are under review, which will strike the balance needed between
the fiduciary responsibility of directors and the public policy
role of the crown corporation.
The auditor general maintains an ongoing brief in this area as
well. All of these measures are designed to increase the
accountability of crown corporations, including the exempt
crowns.
I invite the attention of members to the program review
decisions announced in the February budget.
(1130 )
The budget states that the government will undertake a
fundamental review of its support and mandates of the CBC,
NFB and Telefilm Canada. Strategies and mandates that were
developed under radically different circumstances must be
re-examined in light of today's technological possibilities and
the evolution of both the audio-visual industry and the domestic
market.
That and similar opportunities may be the more appropriate
avenues for the hon. member to pursue his very worthwhile
interest in improving the accountability of the exempt crown
corporation. Such an approach will preserve the flexibility and
the accountability regime for those crown corporations which
require a degree of independence from the direct ability of the
government of the day to intervene in their policy and
administrative decisions.
Ms. Shaughnessy Cohen (Windsor-St. Clair, Lib.): Mr.
Speaker, Bill C-263 has as its goal the bringing of five crown
corporations under the accountability provisions of the
Financial Administration Act which now applies to all other
crown corporations. The corporations this act seeks to include
are the Canada Council, the National Arts Centre Corporation,
the Canadian Wheat Board, Telefilm Canada and the
International Development Research Centre.
Hon. members have listened to earlier discussions on the
merits of having all crown corporations operating under a sound
system of control and accountability. I can only add my support
to those expressions of interest that crown corporations should
be appropriately managed, but I cannot support Bill C-263.
The objective of good government management of crown
investments is neither a mountain of bureaucratic rules and
regulations nor a flawed system that fails to provide the
adequate tools to evaluate corporate performance. Appropriate
accountability must balance control against an adequate degree
of empowerment for corporate managers to do their jobs
effectively and efficiently. After all, crown corporations have a
real and valuable public policy purpose.
I am sure all hon. members would wish to ensure that
important publicly owned institutions such as the Canada
Council, the Canadian Film Development Corporation and
others are held accountable for the results they achieve and the
money they spend. I am equally certain hon. members would not
wish to see the mandates of these corporations compromised,
mandates that Parliament carefully protected in corporate
enabling legislation. Or is that the case with this particular bill?
Perhaps the real agenda here is to remove from these
particular crown corporations their arm's length quality, their
ability to act at arm's length from the government. Perhaps the
real agenda is to stifle the creativity which is part of the Canada
Council, part of Telefilm Canada and part of the National Arts
Centre. Perhaps the real agenda is to suppress the work of the
International Development Research Centre or to prevent the
wheat board from performing its mandate which has been so
valuable particularly to the western provinces.
What is appropriate accountability for these corporations?
That is the real question. Clearly, the present system of laws,
regulations and government policies affecting crown
corporations has evolved considerably. It can provide both
Parliament and the government with much useful information
and the assurance that crown corporations are being well
managed.
The Auditor General reports to this House on a regular basis
on crown corporation matters. Indeed, the Auditor General is the
auditor or the joint auditor for 35 out of 48 of these corporations,
including four that are part of this bill: the National Arts Centre,
the Canada Council, the International Development Research
Centre and Telefilm Canada.
Moreover, Treasury Board reviews the operations of crown
corporations. It deals with resourcing issues for those
corporations that are exempt from part X of the Financial
Administration Act but nevertheless require government
appropriation.
Of prime importance also is the fact that each crown
corporation by law has an appropriate minister. The
corporations are accountable through their ministers to
Parliament. These ministers must table a number of important
accountability documents relating to their crown corporation,
such as annual reports, summaries of corporate plans, operating
and capital budgets.
11654
(1135 )
Stepping back for a moment and looking at appropriate
accountability in a broader context, I believe the fiscal
challenges which the government is currently facing necessarily
will affect the way it manages crown corporations. There will be
an even greater need to find ways of delivering public policy in
an efficient businesslike manner than there is at present.
Reducing or at least more carefully controlling the size of the
public service would appear to be part of the solution toward
meeting this need. Interestingly, I note that Bill C-263 would
actually add to the size of the public service by adding those
employees of the Canada Council, the International
Development Research Centre and the National Arts Centre to
the public service of Canada. This appears to be going in the
opposite direction from that which the proponents of smaller
government usually follow.
I might add that it also runs counter to the general philosophy
of empowering crown corporations to be separate employers and
to take direct responsibility for their personnel matters. This
responsibility must be carried out fairly and efficiently in the
best interests of the corporation.
It is one important example of how the use of crown
corporations with their corporate structure based on the private
sector model can remove layers of red tape in decision making.
Less red tape in personnel administration and human resource
management is one advantage of the crown corporation forum
which may prove to be an increasingly attractive way of
improving the efficiency with which certain government
programs could be delivered. The focus will increasingly be on
the expertise brought to bear on those directly responsible for
the day to day running of those corporations, the expertise of the
board of directors.
The public has demanded transparency and accountability
from all government institutions. Foremost, the public expects
integrity from those officers charged with the responsibility of
running these institutions. In the early months of this
government the Prime Minister made this value central to both
the letter and the spirit of our actions. The quest must be for
financial responsibility and common sense in the way all
government institutions are run and held accountable.
We have seen a number of studies in the area of corporate
governance in the past few years, including work done by Peter
Dey for the Toronto Stock Exchange. What we know is that the
public has effectively been expressing its frustration at being
left out or ignored in both the process and structures of corporate
governance in the private sector. Boards of directors and
corporate managers are experiencing an upsurge in public
sentiment for democratization that has affected many other
aspects of the daily lives of Canadians everywhere: our families,
our communities, our courts and our schools, in addition to
private corporations.
The modern business corporation is now seen by many as both
an economic institution and a social institution. This is closer to
how our crown corporations have always been viewed in their
quest to balance efficient and businesslike operations with the
public policy agenda.
The growing public expectation creates pressure for more
formal rules and regulations, values and ethics for both the
process and the people who influence corporate decision
making. The government is acutely aware of the changing scene
in corporate governance. It has undertaken a number of
important initiatives in this area as they relate to crown
corporations, including those named in Bill C-263.
The Treasury Board Secretariat jointly with the Conference
Board of Canada and the Canadian Centre for Management
Development developed and published an introductory
document on the roles and responsibilities of directors of crown
corporations to provide important guidance on appropriate
accountability for directors. It has been well received since its
publication in July 1993.
In an effort to focus more attention on the goal of improving
sensitivities in the area of corporate governance, a training
conference was held this past fall for CEOs and chairs of crown
corporations to improve the performance of crown corporate
boards. One of the four major themes discussed was the
challenge of balancing the corporate agenda and the public
good.
These initiatives demonstrate that careful attention is being
paid to the evolution of accountability issues surrounding crown
corporations using an open process of consultation. Developing
a new statutory accountability framework for the five crown
corporations named in Bill C-263 should follow the same sort of
consultative process. It should not be insensitive to the
particular needs of those crown corporations affected or their
many significant stakeholders among the Canadian population.
I can only suggest that the bill presented by the hon. member
for Okanagan-Similkameen-Merritt while demonstrating
concern for the interests of Canadian taxpayers does not equally
meet the test of public consultation to which this government is
much committed. I urge hon. members to vote against it.
(1140 )
Mr. Brent St. Denis (Algoma, Lib.): Mr. Speaker, I am
pleased to follow the member for Windsor-St. Clair. She has
already indicated to the House that we on this side applaud the
intent of Bill C-263 but continue to regard the proposal from the
member for Okanagan-Simikameen-Merritt as fatally
flawed.
The bill's central proposal, and I am sure we have all reviewed
this carefully, is to remove the exemption for five crown
11655
corporations from part X of the Financial Administration Act
which sets out a generic accountability regime for crown
corporations. These five agencies are the Canada Council, the
National Arts Centre Corporation, the International
Development Research Centre, Telefilm Canada, and the
Canadian Wheat Board.
There are a number of problems with this bill. In attempting to
convert the employees of the three exempt crown corporations
to public servants, there is the possibility that these employees
would come under the workforce adjustment policy. When we
consider the overall efforts of this government to downsize, this
seems to be an unnecessary complication. It would add
approximately 800 more civil servants if this bill were to pass.
I will pick specifically the International Development
Research Centre. At the time Bill C-24 was proposed back in
March 1984 this matter was raised as a question in the House by
the then member for Capilano. A response was given by the then
Prime Minister, the Right Hon. Pierre Elliott Trudeau.
The enabling legislation passed in the early 1960s allows up
to 21 governors of the IDRC, which include the chairman and
the vice-president, to be non-Canadian citizens and nationals of
other countries. The purpose was to promote a research centre
on north-south issues by way of example which would follow
Canada's lead in the area of international development.
At the time Bill C-24 was before the House it was intended
that the IDRC remain independent of the policy direction of the
Government of Canada. For this reason it was named in clause
85(1) of the bill as an exempt crown corporation.
This effort by the hon. member from the Reform Party would
attempt to turn the clock back. While we can applaud some of
the positive features of the member's proposed bill, the overall
effect would be negative.
There are other elements of Bill C-263 which trouble me.
These are the consequential amendments to other legislation in
the bill to make the officers and employees of the Canada
Council, the Canadian Film Development Corporation, or
Telefilm Canada as it has come to be known, and the National
Arts Centre Corporation to be part of the Public Service of
Canada. Frankly, recent experience suggests that this is taking
measures in the wrong direction.
I am reminded of the trials and tribulations of the Government
of New Zealand in the early 1980s with its massive debt and
deficit situation. Drastic measures were proposed in a number of
areas to deal with that awesome challenge.
One initiative was a complete restructuring of the New
Zealand public service from the way deputy ministers are
appointed and held accountable to the decentralization of
departments. Sufficient time has now elapsed from the initial
turnaround efforts to allow a dispassionate assessment of the
measures put in place. There is a wide consensus now in New
Zealand and among knowledgeable observers of public
administration in many western countries respecting one very
beneficial element of that initiative by the New Zealand
government.
I refer to the introduction of legislation to make each
department of government a separate employer under the
collective bargaining regime established for the public service.
This single measure is given credit for a major element of the
success of the reform package. It has allowed individual
managers to tailor the workforce to the specific mandate of each
revamped agency and significantly reduced the inertia and
rigidity in the service. If anything we ought perhaps to be
exploring the merits of establishing more separate employers,
not fewer.
While New Zealand no doubt had very difficult choices to
deal with, I think most members would agree that Canada as
well has significant debt and deficit challenges on its agenda.
The effort by New Zealand to deal with the matter is a clear
demonstration that the government's intention to achieve more
flexibility in the management of its affairs is the way to go.
Attempting to bring these agencies and their workers within the
general purview of the government flies in the face of our
attempts to downsize, to improve efficiencies and to do a better
job with the resources Canadians give us through taxes on their
hard won labours. It requires that we be responsible with those
resources.
(1145)
Introducing greater rigidity into the system as the bill is
proposing would seem to be the wrong policy instrument for our
present ills. No doubt the intention of the hon. member for
Okanagan-Similkameen-Merritt is to enhance the efficiency
of these crown corporations. In this respect I suspect the
opposite effect will be achieved.
The hon. member's proposals to integrate the employees of
these agencies into the monolithic structure of the federal public
service would unravel a very delicate compromise achieved
between the government and the cultural communities over 10
years ago with the passage of Bill C-24.
These organizations have developed their strengths by
cultivating their distinct corporate cultures over the last few
decades. The erosion of those identities by declaring the officers
and employees part of the public service would at best be
unfortunate. I suggest it would be a backward step.
It risks undermining the longstanding confidence they enjoy
from their partners and clients in such practices as peer evalua-
11656
tions and the reputations individuals have achieved resulting
from their mobility within cultural industries.
For these reasons I respectfully recommend to all members
that Bill C-263 be defeated.
The Acting Speaker (Mr. Kilger): Resuming debate. Seeing
no member rise, the mover of the motion, the hon. member for
Okanagan-Similkameen-Merritt, has given notice to the
Chair seeking the floor under right of reply.
Again I must advise the House that if the member for
Okanagan-Similkameen-Merritt speaks it will close debate.
In fact no one else will be able to speak afterward and I will put
the question immediately following his last intervention, which
will be no longer than two minutes.
Mr. Hart: Mr. Speaker, Christopher Columbus was a man of
vision. He did not accept the status quo. Many times people told
Christopher Columbus that he was wrong in what he was doing,
that he should not even attempt to look beyond or explore past
the horizon, and that if he dared to do so he would surely fall off
a flat earth.
Mr. Mitchell: Do you mean there were Reformers back then
too?
Mr. Hart: The naysayers with whom Christopher Columbus
dealt obviously were Liberals. Christopher Columbus was
probably the first Reformer.
Bill C-263 challenges the status quo as did Christopher
Columbus. However, unlike Christopher Columbus the ideas in
Bill C-263 are not as radical. They are not a form of radical
change but rather are a form of necessary change to Parliament
and to the operations of government and of all crown
corporations.
The accountability framework we are asking the five
exempted crown corporations to be moved into is the framework
all other crown corporations come under. There is no reason why
they should be exempted.
It is a real shame hon. members of the House did not bother
reading the reports of the auditor general from 1989 to 1991
wherein he expressed concern about the subject. I refer to
section 4.100 of the 1991 auditor general's report which states:
The Office strongly supported the strengthened legislative framework for
Crown corporations, and has continually urged that those Crown corporations
that were exempted from Part X of the FAA be brought into line with its
accountability provisions. It is important that Parliament have assurance that
appropriate accountability provisions apply to all parent Crown corporations.
When exemptions are granted, means should be found to ensure adequate
control and accountability.
I urge all members to support Bill C-263.
The Acting Speaker (Mr. Kilger): The House has heard the
terms of the motion. Is it the pleasure of the House to adopt the
motion?
Some hon. members: Agreed.
Some hon. members: No.
The Acting Speaker (Mr. Kilger): All those in favour of the
motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. Kilger): All those opposed will
please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. Kilger): In my opinion the nays
have it.
And more than five members having risen:
The Acting Speaker (Mr. Kilger): Pursuant to an order made
earlier this day the recorded division stands deferred until
Tuesday, April 25, 1995, at 5.30 p.m.
I seek the guidance of the House. Originally the debate was to
end at approximately this time followed by a 15-minute bell for
the vote. By virtue of the arrangement made earlier for the vote
to be deferred, I could either suspend to the call of the Chair or
commence another item of business.
Mr. Boudria: Mr. Speaker, I suggest we suspend for 10
minutes and resume with Government Orders at twelve o'clock.
The Acting Speaker (Mr. Kilger): Is it the wish of the House
to suspend the sitting to the call of the Chair?
Some hon. members: Agreed.
(The sitting of the House was suspended at 11.52 a.m.)
_______________
The House resumed at 12 o'clock.
11656
GOVERNMENT ORDERS
[
Translation]
The House resumed from April 6 consideration of the motion
that Bill C-69, an act to provide for the establishment of
electoral boundaries commissions and the readjustment of
electoral boundaries, be read the third time and passed.
The Acting Speaker (Mr. Kilger): When the House
adjourned, the hon. member for Mercier had fifteen minutes
left.
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, as the
debate drew to a close a few weeks ago, I made certain
references in connection with this extremely important question
put before the House by the Bloc Quebecois: that Quebec should
have at least 25 per cent of the members in this House.
11657
I felt obliged to remind the House that this minimum fell far
short of the kind of recognition the people of Quebec could
expect. I recalled that, in 1965, the man who became Premier of
Quebec in 1966 published his book Égalité ou Indépendance.
This was Daniel Johnson, father of the Leader of the Official
Opposition in Quebec, whose own father was an Irish immigrant
and did not speak French. Daniel Johnson, born of an Irish father
and an Irish mother who settled in Quebec, became the Premier
of Quebec, and it was this man who, after having been a member
and a minister, gave his party a fresh start when he said: ``The
French Canadian nation must have equality within Canada,
otherwise, it will be perfectly legitimate to look for ways to
make Quebec a full-fledged State''.
After pointing out that the French Canadian nation was open
to all and that, when people came from another country, they
could choose to become part of it as they could choose to be
English Canadians, he concluded: ``I will explain why and how
French Canadians are trying to identify with the State of
Quebec, the only one where they can claim to be masters of their
own destiny and can use to achieve the full potential of their
community, while the English Canadian nation tends to make
Ottawa the centre of its community life''.
This text was a milestone in our history, in the history of
Quebec and Canada. Since that time, Quebecers no longer refer
to themselves as French Canadians-people do in the rest of
Canada and, as you know, we are very proud of what has been
achieved by French Canadians outside Quebec who are coping
under extremely difficult situations. But in Quebec, we now call
ourselves Quebecois and the vast majority of the population
identifies itself as such.
Electoral boundaries readjustment is an opportunity to
consider that the Quebec people have a right to minimum
recognition, whatever their choice will be, and based on the
historical importance of Quebec, Canada should support this
principle.
If the rest of Canada had only given some indication that it
was prepared to recognize the Quebec people, our recent history
would have been quite different. If we go back to the minimum
demands made by Premier Bourassa during the talks on Meech
Lake and if we go back to the rejection of the Charlottetown
accord, we find the same desire for minimum recognition, and
the position that the Quebec people are entitled to certain
guarantees.
(1205)
However, in recent history-let us say, until the 1960s-it
was equality that the people of Quebec sought. There were
others, besides Daniel Johnson. There was also, it will be
remembered, André Laurendeau, who was appointed by the
Prime Minister of the time, Lester B. Pearson, to head the Royal
Commission on Bilingualism and Biculturalism. André
Laurendeau also desperately sought equality from coast to
coast, with the focus on Quebec naturally, for the French
Canadian nation, for the Quebecers of his time, as other French
Canadians regularly did in this period of history.
André Laurendeau tried to convince Canadians. He succeeded
in convincing many of the commissioners working with him.
Unfortunately, he failed to convince Prime Minister Trudeau,
who could have implemented the recommendations of the
report, which, like many others, ended up on the shelf.
This episode, like a lot of others, reminds us that, for
Quebecers, who have the possibility of a different future, the
choice offered by Canada has always been: ``Be a province like
the rest or else''.
The reality of history is that, once again, it was not the French
Canadians nor the Quebecers who did not want to build a Canada
which included not only an adequate but an appropriate place for
Quebec. Why? Some accuse us of focussing on the past; the truth
is the opposite. Why do they not level the same accusation at
those who refused to accord Quebec a real place? Why did they
refuse to do so? Perhaps they refused because the French
colonists were from France, and France had been conquered and
had decided to give up in the war in the colony. Are they not the
ones who continue to treat the descendants of the French
colonists not as French stock but as a conquered people?
Otherwise, they would recognize what the world recognizes:
that all the characteristics of a nation and of a people may be
found here, in this land.
Any dictionary definition of the words people and nation fits
those living in the territory of Quebec like a glove. We are a
people; we are a nation. If the rest of Canada had not been
focussed on the past and had really wanted to build a new
country, it would have acknowledged this, because what counts
for Quebecers and Canadians is building a future.
(1210)
We must give ourselves the means to ensure the survival of
our people and their cultural, social and economic development
in the future. It is essential that Quebec develop its people, its
culture and its economy according to its own dynamics and
identity.
That is why the majority of Quebecers will opt for
sovereignty. It must be noted that, for many of them, it will not
be the first choice because Quebecers, who used to be called
Canadiens or ``Canayens'', feel at home throughout the land but
had to confine themselves to Quebec, where they could develop,
as Daniel Johnson, Sr. used to say. In fact, it is important to
realize the extent to which the first French Canadians were
scattered throughout the territory, and the evidence is still there.
It is also important to realize that French Canadian women,
who had the highest birth rate in North America between 1870
and 1960, saw, with breaking hearts, their children and young
families leave for the United States. This is not very well known,
but, for over 100 years, 10,000 French Canadians left every year
11658
because they could not ensure their own development in the
Province of Quebec and because Canada, Western Canada was
closed to them.
And while French Canadians were leaving for the United
States at the rate of 10,000 per year, there was a
``Canadian''-as my former professor Michel Brunet used to
say, using the English spelling of the word-immigration policy
allowing immigrants from the British Isles and Europe to settle
in Western Canada for a nominal sum. According to figures that
appeared in Le Devoir in 1928, the cost of moving to western
Canada was $968 for a French Canadian family with ten children
but only $48 for a British immigrant.
If one wants to prepare for the future, one must look at the
past. For Quebec, the past involved a search in difficult
conditions by French Canadians either in the other provinces or
in Quebec. There was an almost desperate search for our
legitimate place as French Canadians and later, in the 1960s, as
Quebecers, because we clearly developed an identity as
Quebecers.
(1215)
We have maintained that this quest, which for some is still
ongoing, could be realized in a small way through the
amendment put forward by my colleague. Again, whatever
happened in the past, we must live side by side. If it is still
possible to convince my colleagues and the Canadian people
that there is a Quebec people who want an equal partnership,
there must be signs not only from this side but also from the
other side.
Mr. Eugène Bellemare (Carleton-Gloucester, Lib.): Mr.
Speaker, I would like to comment on what the member for
Mercier said, a member whom I regard as a separatist while she
claims to be a sovereignist. This separatist member of
Parliament spoke of the people of Quebec with great pride, and I
appreciate her pride in Quebecers, because I too am proud of
them.
I must say right away that I am myself a fourth generation
Franco-Ontarian. To the separatist member who just spoke, I
say, Madam, that that did not prevent me from-
The Acting Speaker (Mr. Kilger): I must remind the House
that all remarks must be put through the Chair and not directly to
another member.
Mr. Bellemare: Thank you for calling me to order on this
very important matter. Mr. Speaker, the hon. member for
Mercier is very proud to show her allegiance, her patriotism. But
I think that her patriotism is slightly out of place. She seems to
forget that she belongs to the larger Canadian nation, that it is
because of Canadian unity that the provinces and territories
were able to develop and the two official languages of Canada
were able to develop, not because there were people muttering in
one region or another of the country, only looking inwards and
only concentrating on petty local concerns.
Francophones outside Quebec have done well and been
successful. I think I am a case in point. I did well financially, at
school, in the elections, in politics. Never, ever, have Canadians
outside Quebec, or inside Quebec for that matter, hindered my
success. In fact, it is this national attitude that made me to want
to succeed, to want to remain a part of this country.
The member for Mercier kept referring to Canadians who left
the country and settled in the U.S. I must point out to her that
most of those who did that were from Quebec. It is interesting to
note that the member for Mercier uses the term Canadians when
talking about negative things and Quebecers for positive ones;
only Quebecers can do good.
I must say right away that everyone in Canada does good. If
we are to become even stronger as a nation in the future, become
a wealthier nation and achieve a level of education envied the
world over, it will be through Canadian unity, not through this
desire to separate and this constant infighting.
Mrs. Lalonde: Mr. Speaker, I want to tell the hon. member
that our future would be much brighter and our prosperity much
more certain if the rest of Canada stopped refusing to recognize
what Quebec demanded as a people, because these repeated
refusals have led to crises which are an expression of the will of
that people and nation.
(1220)
You cannot silence a whole nation. The issue will always
resurface because the right of nations is a fundamental one.
Democracy is based on that right. Canada's prosperity would
indeed be much greater. It could have been much greater if
Quebecers had been recognized as a people and a nation, instead
of denying that reality. This is true today and it will still be true
tomorrow, for the only uncertainty which exists is linked to the
possibility that you may reject our decision as a people. This is
the only uncertainty; there are no other ones.
Sure, we can talk about prosperity and about the future, but do
recognize that we are a people and a nation, and that the decision
will be ours. In any case, you cannot overlook that basic reality.
[English]
Mr. Dick Harris (Prince George-Bulkley Valley, Ref.):
Mr. Speaker, I do not know whether it is simply Monday
morning or whether it is my tolerance and my patience wearing
thin as day after day in the House we listen to this little band of
separatists as they stand in the House to talk about destroying
the country.
There is nothing more divisive or nothing more destructive to
the country today than to listen to this group stand every day to
say that it wants to be a separate nation within Canada. The
strength of the country is in the participation of all provinces
and all peoples, not the separation this band talks about.
11659
They do not have the support of the majority of the people of
Quebec. Only when they soften their separatist stand and talk
about some sort of mushy sovereignist association can they even
get anywhere close to a 50 per cent vote in the polls.
This band of separatists should be ashamed as they stand in
the House. They collect their paycheques every month from the
Government of Canada, from taxpayers in western Canada, as
they stand here to talk about destroying the country. They should
be ashamed of themselves. Perhaps they should consider going
back to their ridings and staying there until they develop a
different attitude, a Canadian attitude, before they show their
faces in the House of Commons. The Parliament of Canada
represents all people of Canada.
[Translation]
Mrs. Lalonde: Mr. Speaker, we were elected by our fellow
citizens to discuss an extremely important issue to them, namely
their recognition as a people and a nation. In fact, this issue is so
important that, over the last 30 years, it has been very
time-consuming and has kept us from dealing with other major
concerns.
You cannot overlook that reality. You can claim that we are a
small minority, but the fact is that we are not. We represent a
people and a nation similar to many others in the world, which
seek, peacefully, to be recognized and which have sought that
recognition since the very beginning. This is what we are telling
you, and we are also telling you that you will keep hearing about
it. So, you better watch, listen and understand that this people
and this nation have a right to exist.
Mr. Harris: Go home.
Mrs. Francine Lalonde (Mercier, BQ): No, I will not go
home. Mr. Speaker, that should be translated. I find it despicable
to be told to go home while, as the representative for my
constituents, I reflect on our history, pointing out that we want
prosperity but that prosperity will only be possible if we are
treated as equals.
(1225)
This is a despicable and unacceptable insult. If you think that
this is how you will make your country prosper, you are grossly
mistaken.
Mr. Réginald Bélair (Parliamentary Secretary to Minister
of Public Works and Government Services, Lib.): Mr.
Speaker, to begin with, I find myself wondering whether the real
issue being debated is Quebec's borders or the electoral
boundaries to be set by the new commissions.
Firstly, much has been said in this House and in the
Committee on Procedure and House Affairs on the subject of the
new electoral boundaries, especially for northern Ontario and
more specifically for my riding, Cochrane-Superior. The fate
of my riding, and of northern Ontario in general, depends on the
recommendations the commission will make.
First off, it must be said in this House that all Canadians,
wherever they live in Canada, have the right to fair and equitable
representation. Obviously, these two words are charged with
meaning. In particular the word ``equitable'' is defined in
Larousse to mean ``in accordance with justice''. Fair
representation is the most important point which must guide us
in this debate, and this means that rural regions in Canada
should always have direct access to their members of
Parliament. It is not enough for members of Parliament and their
constituents to communicate with each other by telephone or
fax, because this will ultimately depersonalize all that Canada
represents.
[English]
The House affairs committee was somewhat conciliatory
when it permitted the new commissions to be set up to accept an
amendment wherein the same commission may depart from its
application to the rules when considering the economies, the
traditional and natural boundaries and rural characteristics of a
territory, and the access to means of communication and
transportation.
The commission may in its wisdom go beyond the 25 per cent
quota when we talk about the population. This means that a
riding may have less than the 25 per cent permissible quota in
relation to the quotas of a specific province. This is the case for
my riding of Cochrane-Superior and the riding of
Timiskaming-French River.
In future it will be almost impossible to reach the quota of
97,000 people in a riding in northern Ontario and for that matter
in most ridings in northern Canada. Suffice it to say that once the
commissions and the hearings are set up, my colleagues from
northern Ontario and I will fight to the end along with many
concerned citizens and organizations to save the riding of
Cochrane-Superior. This is not only for the sake of saving a
riding but also saving a voice of rural Canada in Parliament.
In general across Canada there are 13 ridings with 100,000
square kilometres and more. Cochrane-Superior has 351,000
square kilometres with 41 organized main communities. It
stretches from the border of Quebec to the east and goes west to
the riding of Thunder Bay-Nipigon, which is some 425 miles.
(1230)
In 1994 I logged 23,000 kilometres in order to try to serve my
constituents as best I could. It would take 18 hours non-stop to
go around the riding of Cochrane-Superior. To divide it into
11660
four as was recommended, annexing the four parcels to existing
ridings, would simply mean that in most cases those ridings
would double in size and 16,000 people would be added per
riding.
In other ridings, namely the urban ridings, a member of
Parliament can attend a function at either end of the riding in the
same day, in many cases within the hour and in some cases
within minutes. That is not to say that urban members of
Parliament have it easy. We in northern Ontario recognize those
ridings have a much larger population and those members
therefore spend more time with constituents. A member of
Parliament should be accessible to his or her constituents no
matter what.
In large rural ridings many people feel isolated and that is why
there is a need for the member of Parliament to meet with his or
her constituents. Those people also have to be heard and
counted, and they need to feel they are a part of this country, that
not everything is being decided by the urban ridings.
Handicapped people and the elderly, given the long distances
which they have to travel in rural ridings, practically have no
chance of meeting their member of Parliament unless he or she
visits them. To further increase in size rural ridings would mean
disaster for many Canadians living in those ridings, especially
in isolated areas.
[Translation]
Mr. Speaker, I would like to read to you a summary of an
extremely interesting conversation I had with a public servant:
``An electoral district is much more than a geographic division
for electoral purposes. An electoral district represents an
economic, social and cultural group of several thousand people.
An electoral district is as much a tool for grouping common
interests as it is a means of expressing the identity, lifestyle and
shared values of its inhabitants. From this perspective, the
electoral district should be given the same status as a town, a
province or a country. Any substantial change in the boundaries
of the electoral district could cause major economic and social
changes in that area. The boundaries of existing electoral
districts must be revised equitably and changes must not upset
their economic and social equilibrium''.
I have two concrete examples to illustrate my point. Let us
consider first of all the selection of candidates. If my riding
were split in four and annexed to the four neighbouring ridings,
without fail, the chances of the party nominating a person from a
rural region as a candidate would be about nil, if he or she were
competing against a potential candidate from an urban region or
larger town with many supporters and able to sell membership
cards, etc. People from rural regions, in the true sense of the
word, would have very little hope of ever being elected to the
House of Commons.
(1235)
The second example I want to mention concerns rural regions
and their economic relationship with Canada. We are rich in
natural resources. The viability and vitality of our economy
depends on those natural resources, and the rest of Canada
should appreciate our contribution.
I could also draw a comparison with New Brunswick and
Prince Edward Island. Obviously, we cannot rewrite the
Constitution Act, 1867 and the agreements concluded at the
time, under which New Brunswick was guaranteed ten ridings
and Prince Edward Island four ridings. However, together these
two provinces have more or less the same area and population as
northern Ontario.
At the present time we have eleven electoral districts, while
New Brunswick and Prince Edward Island have fourteen. This is
an example of inequity. As I said before, it would be very
difficult to change this without amending the Constitution Act,
1982. My point is that we should at least recognize the fact that,
compared with other regions in this country, northern Ontario is
under-represented and cannot not afford to lose another seat in
Parliament.
[English]
Canada is a huge geographic misunderstanding. This
misunderstanding will not be resolved for many years to come.
The fact that rural Canadians represent a minimal part of the
population of Canada is not a good enough reason them not to be
justly and adequately represented in the House of Commons.
Mr. Stephen Harper (Calgary West, Ref.): Mr. Speaker, I
thank the previous speaker from Cochrane-Superior for his
remarks, not because I necessarily agree with them all but
because they were on the topic of the bill which has been sadly
lacking in this debate.
This is a debate about Bill C-69, an act to provide for the
establishment of electoral boundaries commissions and the
readjustment of electoral boundaries, specifically to scrap the
process under way last year to redraw our boundaries based on
the 1991 census and establish a whole new process.
We are now winding up a parliamentary debate on this that
started over a year ago which in our view has yielded only
minimal improvements to the electoral boundaries process.
The motion that had initiated this bill had asked the procedure
and House affairs committee to examine methods of capping and
reducing the size of the House of Commons, to improve the
process by which boundaries commissioners are selected, to
consider how the boundaries commissions conduct their work
and to consider the involvement of the public. In three of these
areas there were some minor improvements. However, the bill
fails to address the already excessive and growing numbers of
11661
members in the House of Commons. That failure in particular
prevents our party from endorsing the bill.
The changes made to the boundaries process while useful for
future census in our view do not justify scrapping the
commission or rejecting the reports of the existing boundaries
commissions.
While we are opposing this bill members of the Bloc
Quebecois have been opposing this bill for an entirely different
reason, one to which I will address my remarks.
The Bloc position on this entire process for bills C-18 and
C-69 has been very inconsistent. It supported going through this
process and then opposed it again.
Initially the concern was about boundaries. Now the concern
is about Quebec's not having a guaranteed 25 per cent of the
seats. Under the formula coming forward I will point out what
we are actually talking about in terms of substance. We are
talking about the demand from the Bloc Quebecois that Quebec
be guaranteed 25 per cent of the 301 seats we will have out of
this redistribution; in other words 75.25 seats. Quebec will get
under the formula 75 seats. This is probably the most verbiage
we have expended in the House over one-quarter of a seat.
(1240 )
I am not entirely sure this position is not changing again. Over
the Easter break we learned from the leader of the Bloc
Quebecois that apparently Quebec now wants 50 per cent of the
seats. The position keeps shifting.
I want to address it seriously because there has been much
misinformation and many misstatements made about this. I will
outline the facts. The Bloc has made at least four assertions
which need to be challenged, assertions of fact, assertions
directly related to the bill and to the issue of 25 per cent of the
seats.
The first and most obvious Bloc assertion is that this kind of
guarantee could be achieved without a constitutional
amendment. We know that is not the case. This was a provision
of the Charlottetown constitutional accord opposed by the Bloc
Quebecois which I will talk about later. It was in that accord
precisely because it required a constitutional amendment.
The Constitution Act of 1867 lays out the formula for the
redistribution of seats in the House of Commons every 10 years.
That formula is contained primarily in section 51. Section 52
makes it clear that while the number of seats in the House can be
changed, the House is not free to amend its formula in a way that
would depart from the proportion of population among the
provinces. Section 52 makes clear that principle is protected.
Furthermore, under the Constitution Act of 1982 under
section 42(1)(a) the amending formula is explicit that changing
the proportion of seats in the House can only be done with a
constitutional amendment approved by Parliament and by
two-thirds of the provinces representing at least 50 per cent of
the population.
The second incorrect Bloc assertion is that under existing
constitutional formula only New Brunswick and Prince Edward
Island are guaranteed certain representation in the House of
Commons. This is also not true. Section 51(a) of the
Constitution Act of 1867 makes it clear all provinces are
guaranteed in the House of Commons at least the number of
seats they have in the Senate. That was a provision added in
1915.
Obviously under that provision it has an immediate effect on
the representation of New Brunswick and Prince Edward Island,
whose seats would fall below 10 and 4 respectively if that were
not there. It also applies to all provinces. Quebec is in effect
guaranteed 24 seats by that provision, many more than New
Brunswick or Prince Edward Island, although Quebec has many
more seats.
As well, the Constitution Act of 1982, section 41(b), the
amending formula, makes it clear this particular provision as it
relates to any of the provinces can only be changed with
unanimous consent. We are all aware of the difficulties in
getting unanimous consent. I will talk later about some of the
things we would like to see. Clearly that is not in the cards today
if for no other reason than all governments in the country realize
they could never get the support of the Government of Quebec
for any step, for any constitutional change, for anything positive
or negative.
Another point where the Bloc is not correct in claiming that
only New Brunswick and Prince Edward Island are protected is
there is an additional grandfather clause in section 51 of the
Constitution Act of 1867. It is not an especially protected
section but it guarantees to all provinces the representation they
had in the House of Commons in the mid-seventies, a provision
my party does not support and a provision that can be changed
through an act of Parliament but which this bill does not change.
Under that provision Quebec is guaranteed the 75 seats it has
today. Were it not for that provision Quebec's share would
probably fall by one or two seats.
The third Bloc assertion in this debate that has not been
correct is that the demand Quebec be guaranteed 25 per cent of
the seats in the House of Commons is one of the historic
demands of the province of Quebec. I found this particularly
interesting. I worked for the no side in the constitutional
referendum. An argument frequently made both inside and
outside Quebec was that this provision of the Charlottetown
accord guaranteeing Quebec 25 per cent of the seats had in fact
not been a historic demand of the province of Quebec and had
11662
really just come out of the hurried negotiations in the summer of
1992. I decided to do a little bit of research and confirmed that
was the case.
(1245)
Perhaps we have overlooked something, but I cannot find any
record of a major Quebec actor demanding a guarantee of 25 per
cent of the seats in the House of Commons prior to the
Charlottetown accord.
I would say that there are some origins, which may be in the
Victoria conference proposal. In 1971 the Victoria
constitutional agreement proposed that every province that at
the time had at least 25 per cent of the population be guaranteed
a constitutional veto indefinitely. This would have given
Ontario and Quebec a veto over any changes to the Constitution.
Of course it was ironic that that accord also failed, partly
because of the attacks by the Parti Quebecois and the separatists
in Quebec at the time. But ultimately, the accord was rejected by
Quebec federalists as well.
Once again, the fact of the matter, as far as we can tell, is that
this is not a historic demand, although like so many things in this
country it has become a demand from the very separatist
element that rejected it in the first place, much in the way certain
versions of the Confederation agreement are now endorsed by
the separatists who rejected that agreement at the time.
I want to get to the fourth Bloc contention, that somehow the
failure to give Quebec a guaranteed representation in the House
of Commons represents a violation of the agreement of
Confederation. It is particularly interesting how it can represent
a violation of an agreement that never existed. There never was
any such provision in the Constitution of 1867.
In making this argument the Bloc Quebecois has pointed out
the fact that in the old Canada, the union of the two founding
provinces we hear so much about, the union of 1841 to 1867,
Quebec had 50 per cent of the seats and there was a dual
premiership, as members will recall.
Confederation came about because that arrangement broke
down. It was completely unworkable to have the principal
House where the guaranteed number of seats is invariant to
population and where there will be some kind of equal marriage.
It did not work. It brought about Confederation. And if
Confederation were ever to fail for Quebec, as the separatists
suggest it will, then of course the rest of Canada would never
enter into an agreement that would recreate a union that already
fell apart in the 1800s.
It is important to remember what the agreement of 1867 did. It
did not guarantee Quebec a percentage of seats in the lower
House, as we had had prior to 1867. It had three separate
elements that dealt much more creatively with the concerns of
Quebec and with the other regions and the new partners of
Confederation.
First, it created the House of Commons, where representation
would be on the basis of population, a principle understood in
every democratic country in the world.
Second, it created a federal system. This is something we
should not forget. Colleagues in the Bloc always say that
Quebec's power at Confederation fell from 50 per cent to 35 per
cent. In fact it did not. Its share of the seats at this level of
government fell from 50 per cent to 35 per cent, but the most
important feature of Confederation was the creation of a federal
system and the creation of the province of Quebec as a separate
legal entity. The Confederation agreement gave Quebecers local
autonomy through their provincial legislature over a number of
exclusive provincial jurisdictions.
I should add that my party is opposed to the historic attempts
of the federal Liberals to undermine those exclusive provincial
jurisdictions. Those jurisdictions should be respected, and in
our view the federal spending power should not be used in a way
that intrudes upon those exclusive competencies.
Third, the agreement of 1867 created the Senate. It created a
separate chamber, one of the purposes of which was to provide
guaranteed representation for various regions of the country. I
have spoken on this many times, as members will know. That is
in fact the chamber where regional representation for Quebec
and for other provinces was to be guaranteed.
(1250)
That part of the accord has not worked out the way the regions
of this country would like it to work out. One of the things that
constantly mystifies us as western Canadians is the demand of
Quebec separatists to abolish the upper chamber, rather than
make it the very basis of regional representation that we in the
regions of the country want against the enormous population
weight of Ontario. That is rejected time and time again, although
it is a feature of virtually every democratic federation in the
world.
The history of that, I should point out, is quite interesting.
Quebec was originally guaranteed 33, a third of the seats in the
upper House. Later, as this country grew, as western Canada
entered, that guarantee fell to 25 per cent, since we recognized
four regions. Today, of course, we have seats for Newfoundland
and the territories, which are outside of the original regional
agreement.
There has been a guarantee in this Parliament for Quebec to
have a certain representation. That representation is guaranteed
in the Senate. Our provinces in the west would like to see that
chamber become more effective. We would like to see ourselves
guaranteed effective representation as well. That is the way to
address this issue.
11663
Members will recall that the Charlottetown accord was
rejected through most of the country. The Bloc Quebecois,
which suddenly finds it is fond of the 25 per cent guarantee in
the Charlottetown accord, forgets that that guarantee was part of
a package-not just the whole accord, but specifically part of a
package of reforms to both the Senate and Commons.
These reforms were rejected for a number of reasons, not
simply because of the issue of departure from representation by
population but also because of the expansion of the size of the
House of Commons, an expansion that would have gone
dramatically to 337 members overnight and would have moved
even more quickly into the future. That was one reason for
rejection, something we are now replicating with this act,
although not as badly.
Of course it was also rejected because of the obviously
inadequate provisions as they related to the Senate, the failure to
guarantee election to the upper House, the failure as well to
guarantee effective powers for that body to protect the various
regional interests that chamber is supposed to secure.
I do not want to go on too long because I have talked at length
over the past year about this bill. We remain opposed to the
provisions of this legislation, to the idea that we should scrap the
existing boundary commissions and start from scratch. The few
worthwhile improvements here can certainly be deferred to the
1996 census. We would save the taxpayers $5 million.
I do want to emphasize that in opposing this bill we in no way
endorse the obstructionist tactics of the Bloc Quebecois, who
are opposing this bill for entirely different reasons related to the
separation of Quebec. The 25 per cent guarantee they have
demanded for Quebec and the rationale they have used to back
that demand simply do not stand up to factual scrutiny.
I should add in closing that it is increasingly clear that the
reason the members of the Bloc Quebecois are so interested in
guaranteeing a certain number of seats for Quebec in the House
of Commons is that I think they are coming to realize that
Quebec will be here in the House of Commons by the time the
next election comes around and will be here for many more
elections after that. We look forward to that.
[Translation]
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, I listened in particular to the last part of the MP's
speech. He knows his Canadian history. He knows the recent
history of Quebec since Charlottetown and Meech. English
Canada has said no to Quebec several times.
(1255)
Does he not think that the people of Quebec, one of Canada's
founding peoples, have a legitimate claim to this 25 per cent
guarantee? I think that Quebec's request is quite modest. There
is almost unanimous support for it, and I fail to understand why
the hon. member from western Canada wants to completely
ignore, under false pretexts, Quebec's legitimate request. I
sincerely hope that he will explain the reason why.
Mr. Harper (Calgary West): Mr. Speaker, as I said in my
speech, I support the principle of representation by population
in the House of Commons. It is a democratic principle enshrined
in the Constitution.
In fact, Quebec could end up with close to 25 per cent of the
seats in the House after the proposed redistribution.
In addition, when the hon. member talks about post-Meech
Quebec, one thing is clear to me, and that is that Quebecers want
to keep their Quebecois and Canadian identity and it is only
within a federal state that both will be possible.
[English]
Mr. Ted McWhinney (Vancouver Quadra, Lib.): Mr.
Speaker, the debate concerns Bill C-69, which is comprehensive
in its scope but nevertheless has a precisely defined mandate,
and that is concerned with electoral boundary redistribution. It
is not a place to re-examine or to start again debates that were
conducted in other arenas in which I and other hon. members had
the privilege of taking part. It is not a reprise of the
Charlottetown accord debate or of other debates relating to what
was called the statut constitionnel particulier for the province of
Quebec or any other special arrangements. There may be a case
for these special arrangements, but it is not a matter germane to
the discussion today.
What we are concerned with here is a change, a reform, if you
wish, a modernization of the process of establishing electoral
boundaries in Canada. It is correct to say that we are somewhat
undeveloped in constitutional terms in our attitude toward the
electoral processes and in the timid way in which we move up to
the necessary and inevitable constitutionalizing of the electoral
processes. In some other constitutional democracies, some more
ancient than our own, others much more recent, the process is
fully constitutionalized and there is a role for Parliament that in
some senses we seem to be abdicating here. There is no
particular problem in Parliament itself establishing electoral
boundaries, provided it is governed by a code of constitutional
principles, ideally in the constitution itself, and provided there
is a full and effective power of judicial review. The progress
toward full equality and participatory democracy in the United
States has been achieved in just that way.
11664
More recently, in the post-World War II German constitution,
the constitutionalization of the electoral processes is achieved
in the constitution, in electoral laws and in a substantial series of
decisions by the courts.
I do believe that this will come to pass in Canada, that the
courts will recognize that the electoral processes go to
constituent power, which is a pre-constitutional power but it is
the basis on which constitutional government operates: fair,
open, and honest elections, open to public scrutiny in all aspects
of the processes.
I think the best way is to draft it into the Constitution itself
and certainly have an active, vigilant constitutional court that
has the sophistication not to be afraid of electoral issues, as for
many years our own courts were. They are not difficult to
examine. The issue of basic fairness and the probity of the issues
have been discussed and examined by supreme courts as diverse
as those of Germany, the United States, Japan and India. The
process works.
(1300)
What has been done is that a very strong committee of the
House-I call it that in the language that the courts use but it is a
strong committee-which happened to have excellent
representation from the main opposition party, the second
opposition party and government members, made a long
examination of this issue and has brought forward a bill.
It does not touch the issue of whether one province should
have 25 per cent representation in the House. It would not have
been germane to its mandate. In any case, I would have thought
that with the evolution of constitutional democracy in Canada
such an issue now could only be decided by full participatory
democracy with the assent of the Canadian people expressed in a
popular referendum vote. The Charlottetown process at least
established that principle and I think all parties wish to work
with it.
I listened with great sympathy and admiration to the
arguments advanced by members of the second opposition party.
However, I feel this was not the arena in which to discuss
limitations or increases to the size of the House other than those
that followed logically and inevitably from the census figures,
which is one of the vines that we have in terms of the electoral
process as it now stands.
What has been done here is that an attempt has been made to
open up the process of the establishment of electoral boundaries
by looking to the issue of who makes the decisions. If it is
constituent power it goes to the power of Parliament itself and it
is probably a power more awesome than that of the judges. Yet to
date, it has been exercised by commissioners who were
appointed on the discretion of the government of the day and
answerable to nobody other than their own conscience in so far
as the courts have not, as I have mentioned, exercised a review
control in Canada.
What has been done in this bill is a compliment to the
collegial atmosphere in the committee on this particular point.
A system has been set up where while the executive retains the
power of appointment-at least Parliament does-there is a
process of public advertising and consultation. There is the
obligation to consult with the leaders of all the parties. Does it
go far enough? We shall see. However, it is certainly an advance
on the present system.
I say that having served as an electoral commissioner myself.
I was asked by the then Speaker of the House, Madam Sauvé, if I
would serve as the electoral boundary commissioner because
she wanted to get it out of politics. It is not a job that gets any
particular awards but it is something to do in the spirit of public
service. This is fine but it is still a system without controls. That
is why the present proposals are an advance.
If we look again at the reports of recent boundaries
commissions, the justifications are at best skeletal, a few lines.
They do not really explain the why or how and on what basis and
what criteria the decisions were arrived at.
In this particular bill which the committee has brought
forward, the boundaries commissions are now required by law to
provide three alternative maps for every constituency in which
they report. They are required to provide a justification for their
choice of opting for one rather than the other two.
Again I think it is a significant advance. It may be that one
could have gone further, but in the nature of the committee as it
was operating and the desire to build a consensus, the chairman
of the committee felt this was the way to go. I think it is a good
choice. Therefore, I am optimistic about the progress that will
be made when this bill is adopted. We do need an open process.
We also need as much public participation as possible and a high
degree of scrutiny.
I think there is still a role for the courts. I would like to see this
in the same way the justice ministry has financed litigation
involving the Official Languages Act. Maybe test cases could be
taken up when issues of electoral boundaries come up that raise
constitutional principles: Is the principle of equality of
representation adequately recognized in what the commissions
have done? There are constitutional principles that can control
this. Courts in Japan, India and other countries have little
difficulty in applying them and the road would be open here.
(1305)
This bill is an example of a committee interpreting its
mandate in a full respect for criteria of relevance. It has not tried
to go beyond the mandate as defined. It recognizes that other
11665
problems, cognate as they may be, are to be handled in other
bills. Therefore, I think it is a significant advance.
It does not, I repeat, replay Charlottetown. The Charlottetown
accord was quite decisively voted on by the people of Canada
and is now in the dustbin of history. Parts of it were interesting
and valid and may be worth bringing back but that is a matter for
debate elsewhere and on another occasion, not here.
While I appreciate the eloquence of the hon. member for
Mercier and the contributions he made to the debate, I do not
think it really bears too much on the mandate of the committee.
I appreciated the remarks of the hon. member for Calgary
West. On many of the matters he has raised a great deal of
research has been done by him and by others. There are points
that I might share with him but again, I do not feel that for this
particular bill this is the occasion to get into these matters.
I take pride as a member of the committee concerned. It
worked very well. It is an attempt to replace a system that was
somewhat arbitrary in the sense that the commissioners were
selected by a process in which there was no real review. They
were not required to provide criteria for their decisions. In
essence we had situations where decisions could be, as was said
of Lord Eldon's chancellorship ``an inequity as long as the
chancellor's foot''. That is not good constitutionalism.
This is a good step forward. It is on that basis I commend it to
the House.
[Translation]
Mr. Paul Mercier (Blainville-Deux-Montagnes, BQ): Mr.
Speaker, the hon. member opposite, in referring to the speech by
the hon. member for Mercier, indicated his interest in what she
said and, in turn, I may say I was very interested in the way the
hon. member opposite used examples from other countries and
went back in history to support his argument.
I would be interested to know whether he was aware that, at
the beginning of the nineteenth century, the Hungarians within
the Austro-Hungarian Empire were in a situation quite similar
to that of present-day Quebecers in the Canadian federation. In
other words, they were an unhappy minority. They rebelled and
were defeated, but subsequently, the Austrians, who were the
ruling majority in the Empire, decided to negotiate and in the
process recognized the so-called double monarchy, a structure
in which both peoples, the minority and the majority, enjoyed a
certain level of equality to defend interests they might or might
not have in common.
In the same century there was another situation very similar to
ours, and I am referring to the Norwegians who were not happy
about being part of the kingdom of Sweden. They were an
unhappy minority. Like the Hungarians, they rebelled, and were
defeated. Subsequently, the Swedes agreed to negotiate and
recognized a status also referred to as a double monarchy, which
also included a parity structure that was different from
Parliament but nevertheless a parity structure. I may recall that,
in the twentieth century, both Hungary and Norway became
independent. They were recognized as independent states.
I want to ask the hon. member opposite whether he feels-and
he may not agree-that in this Parliament, representation should
be based on population?
(1310)
Does he agree there are two founding peoples here and at what
level would he see a parity structure that would recognize that
fact, or does he deny there are two founding peoples in this
country?
Mr. McWhinney: Mr. Speaker, I would like to thank the hon.
member for his remarks. I am quite familiar with the history of
the Austro-Hungarian empire and its particular constitutional
theory. I make reference to it in a number of my books and am
very often quoted by learned Quebecers in the debate on the
development of the quiet revolution.
Nevertheless, all of the facts must be examined. The
Austro-Hungarian empire was not a developed democracy as we
know it today. We must also recognize that the dual monarchy
was, in a way, intolerant of the rights of other minorities. The
claims of the slavic minority were not recognized, which gives
us cause to look at the failure of the Austro-Hungarian empire,
in view of its defeat in the first World War.
Comparisons may be made between Canada and the
Austro-Hungarian empire of the 19th century, and in particular
the Ausgleich agreement, as it is known in German, of 1867.
However, very very few of them may be made. As to whether the
Canadian constitution can accommodate a situation similar to
that of the Austro-Hungarian empire of the time, I would like to
point out that the federal system is very flexible and capable of
accommodating many different constitutional arrangements.
The prerequisite today, however, is that these claims be
approved by popular vote. This is the fundamental reason for the
failure of the Charlottetown accord. Under these circumstances,
should the question arise in the future, yes, our federal system
can accommodate any constitutional variation, provided it has
been submitted to and approved by a popular vote.
[English]
Mr. Stephen Harper (Calgary West, Ref.): Mr. Speaker, in
deference to the hon. member for Vancouver Quadra, I will not
ask a question outside the scope of the bill, but rather one within
its scope.
He made some comment about the constitutionalizing of these
provisions. One thing that is being kept in the bill which is in the
existing legislation is the variation of 25 per cent from the
quotient for the size of populations of electoral districts. He will
also know that in this bill not only do we keep that variation in
normal circumstances, but we continue to leave open the possi-
11666
bility of extraordinary circumstances where those variations
will get much larger.
The hon. member will know that in the United States the
general direction I think it is fair to say has been partly imposed
by the courts over time. In the House of Representatives ridings
are created that are almost equal in population, of course with
their peculiarities which we would not necessarily allow here.
On the question of variation, as an academic expert I would
like him to inform the House why we have gone in the direction
of allowing very large variations in Canada, whereas the United
States with a country of similar size has been able to create
constituencies that are virtually equal in size. Would he like to
see our country consider moves in that direction in the future?
Mr. McWhinney: Mr. Speaker, I thank the member for
Calgary West for the very thoughtful question. He will know
that we discussed this matter in committee and on some of these
points our views were closer than the report of the committee
might indicate.
(1315 )
The United States constitution, in its evolution, is assisted by
the fact of equality of representation in the Senate, so that
Americans do not have to justify to the extent other countries do
disproportionately large electorates for some states and
disproportionately small electorates for others.
The United States Supreme Court has said, at least Mr. Justice
Douglas has said, that equal things are to be treated equally,
according to the doctrine of equality before the law, but unequal
things do not have to be treated with the same canon of legal
equality. Putting it this way, I can see the case, as a city member,
made for country constituencies, that a lesser number of voters
should be tolerated. I can see the case for going to 15 per cent. I
had some problems with the 25 but I recognize that in
committee, a consensus emerges and one accepts it.
We are not yet in the same situation as Japan where the
supreme court had to rule on a situation where the electoral
districts in Tokyo had five times the number of electors as the
districts in the neighbouring country regions. Obviously that is a
disproportion that cannot be tolerated.
Where do we draw the line? The committee, with some
accommodation from urban members like myself and the hon.
member opposite, tried to recognize the special quality of life of
country constituencies and that perhaps a lesser number of
electors was required. The 25 per cent has to be seen in that
light. However, it would be simpler if we had a Senate with
equal representation or something of that sort. The reform of the
Senate is a subject on which the hon. member and I have many
views, but it is, again, not a matter for this discussion.
[Translation]
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, it is an honour for me to speak again at the third reading
stage of this bill on behalf of the official opposition, the Bloc
Quebecois, the sovereignist party in Ottawa, on an issue as
important as the act to provide for the establishment of electoral
boundaries commissions and the readjustment of electoral
boundaries.
I would like to explain in very simple terms to the people
listening to us that this bill establishes regulations for future
federal elections.
At first sight, this bill might seem of little interest to Bloc
members. English Canada provinces could settle the matter
among themselves since, when the next federal election is held,
Quebec will probably be a sovereign country.
However, in October 1993, I was elected-I reiterate this fact
because I know that my colleagues across the way like to hear
it-first, to look after Quebecers' interests and, second, to
promote sovereignty in Ottawa, as I often do.
However, in fulfilling the mandate of looking after
Quebecers' interests, Bloc members must be vigilant. It is
because of this vigilance that we are denouncing this bill, which
goes against Quebecers' interests.
The process that led to the drafting of Bill C-69 went through
Bill C-18, which was tabled in this House over a year ago. Bill
C-18 suspended the electoral boundaries readjustment process
then in progress for 24 months before a new debate on
redistribution could start.
Unfortunately, the Reform Party objected to that bill and its
proposed 24-month suspension. Nevertheless, the House, as we
know, passed Bill C-18.
However, when the bill went to the other House, the hon.
senators did the job that Reformers had initiated in this place.
The other House included in Bill C-18 an amendment providing
that a new bill must be tabled by June 1995 at the latest, or else
the old legislation and the commissions suspended by Bill C-18
would be reinstated.
The bill before us has two objectives, the official objective
and the unofficial one, which is just as important if not more so:
to reduce as much as possible Quebec's political weight in this
House.
(1320)
Of course the strategy has changed. Since Lord Durham
tabled his report, English Canada, the federalists have taken a
different approach. The approach may be a more subtle one, but
the ultimate goal has remained unchanged: the assimilation of
Quebecers.
11667
How can this be achieved? By failing to recognize Quebec,
the people of Quebec, as a founding nation, by not recognizing
its distinctiveness, by quashing their every demand and
legislating to reduce the political weight of Quebecers in Ottawa
by increasing the number of members from outside Quebec,
members who will vote against Quebec and put Quebec in its
place at the first opportunity.
But history has taught us that one does not have to come from
outside Quebec to vote with the English Canada majority and
against Quebec in particular. We need not think back very far
indeed to realize that. I can see it happen regularly since coming
to this place. I saw it again with my own two eyes during the vote
at report stage, when Liberal members from Quebec ignored
Quebecers' wishes and defeated a motion presented by the Bloc
Quebecois to ensure that a minimum of 25 per cent of seats in the
House of Commons go to Quebec.
Yet, this was a very simple motion and it read as follows:
``Notwithstanding the foregoing, when by application of this
subsection the number of members to be assigned to the
Province of Quebec is less than 25 per cent of the total number of
members in the House of Commons, the Chief Electoral Officer
shall assign at least 25 per cent of the total number to the
Province of Quebec''.
Quebec's influence on decisions made in this House will not
start to decline in 100 years, but immediately. In the next federal
election, Quebec will no longer have the same decision-making
influence, it will be smaller. The figures speak for themselves.
Our numbers will be reduced, falling below the 25 per cent level
of representation we have always had in this House. Never in the
history of Quebec have members from Quebec opposed a motion
to protect Quebec's legitimate rights, to protect its political
weight within the Canadian federation.
What are we, members from Quebec, here for? What have we
been elected to do? Every member from Quebec in this House,
regardless of political affiliation-whether red, blue, yellow,
whatever-was elected by Quebecers to look after Quebec's
interests. This motion to ensure a 25 per cent minimum was
designed to protect Quebec's interests and that is why we
presented it.
We and all these other members have the duty to protect
among other things Quebec's political and decision-making
influence. The federal government ignored Quebec in this bill.
The same way, Quebec will ignore Canada before long. When I
see the government and the third party, the Reform Party, hand
in hand, joining forces against Quebec, I know it is high time
that we pack up and leave.
The Bloc motion would have guaranteed one quarter of the
seats to one of the two founding nations of Canada, while also
complying with the traditional and legitimate requests of
Quebecers to preserve minimum political leverage within the
Canadian federation. The attitude of the Liberal members is
hypocritical. Barely three years ago, these same Liberals
defended Quebec's right to 25 per cent of the seats in the House
of Commons. Back then, they formed the opposition. It is
strange how time changes things sometimes.
Given that attitude, many of the positive aspects of this
legislation are eliminated. Members worked hard to come up
with a bill designed to improve the whole redistribution process.
However, their efforts were vain, since the government ignored
some very important recommendations.
Had some specific provisions been included in it, this
legislation could have sent an ultimate message to Quebecers.
Instead, the government preferred to team up with the Reform
Party to once again put Quebec in a vulnerable position.
Nevertheless, as I said earlier, there are some positive aspects to
this legislation and I will list a few.
(1325)
For example, after a decennial census, the changes to the
electoral map will be followed by a readjustment five years
later, so as to avoid drastic changes in the electoral districts.
This is a good change which fulfils a need.
The population of each electoral district will be allowed to
vary by more or less 25 per cent from the electoral quota for the
province. This is a minimum which, I think, had to be included
in the bill.
Provincial commissions will have to hold public hearings
before starting their work. Again, this is in response to a
legitimate request made by constituents from every riding.
In determining electoral district boundaries, the provincial
commissions will have to consider the community of interest,
the size of each district, as well as foreseeable geographic
changes. In a riding such as Berthier-Montcalm, which I have
the honour to represent, the need for such criteria is obvious.
Otherwise, we end up with ridings of 50, 52 or 60
municipalities. There has to be at least a certain sense of
belonging and the bill ensures that this is the case.
Provincial commissions will have to submit three draft maps
and hold new hearings if necessary. Again, this is very good.
As the hon. member for Kamouraska-Rivière-du-Loup
mentioned, something had to be done. I am referring to the
member's comments because he put the finger on an extremely
important aspect of the issue. He said the following: ``It seems
to me that it is not simply a question of ensuring adequate
mathematical representation but of ensuring adequate
representation''. These are two very different matters. Equity
cannot be measured mathematically. If it could, we would fix
the problem
11668
on our calculators and save a lot of money. But when a riding is
as small as six blocks of Toronto, Montreal or Vancouver versus
55 or 60 municipalities, like my riding, Berthier-Montcalm,
should other criteria not be taken into consideration to ensure
that the citizens of these ridings are as well represented in
Parliament as those of urban downtown ridings in big cities?
The suggested changes addressed this issue, but, as I said
earlier, the snub on Quebec that this bill contains is totally
unacceptable. In fact, and I will close on this note, Bill C-69
gives no mandate in this area and it could easily have given one
to some parliamentary committee. I think that it is not the means
to resolve the problem of Quebec's dwindling representation in
the House of Commons that is lacking.
Worse yet, Bill C-69 gives no guarantee that the continual
reduction in the number of members in this House from Quebec
will be halted. On the contrary, the bill maintains the formula set
out in section 51 of the British North America Act, which results
in a weakening of Quebec's influence within federal
institutions.
You will understand that, as long as the people of Quebec have
not made a decision on their future, which will certainly be in
favour of sovereignty, it is very important that Quebec
maintains adequate representation within federal institutions.
I disagree with some of the comments which the Reform
member made and I think that, given that we are here to defend
the interests of Quebec, we are here to play to win from within
the system and we will do everything possible to guarantee
Quebec minimum representation, and demanding 25 per cent is
a way of guaranteeing Quebec a minimum impact on decisions
made in this House.
We are not demanding this because they say we are going to
lose the referendum, on the contrary, we are going to win it.
However, I think that, at the very least, a member who represents
the interests of Quebec had an obligation to present this motion,
to guarantee Quebecers the 25 per cent we have always had since
Confederation and which we will lose in the next election
because of a Liberal government that failed to make any
provisions for this in the bill.
All Quebecers, whether or not they agree on sovereignty,
agree that Quebec should at least keep 25 per cent. And since
everyone likes Quebecers or at least that is what they say, we
should be able to get unanimous consent in this House.
I want to ask the Liberal members from Quebec and the
government to rescind the previous vote so that we can have a
bill that reflects the unanimous demands of Quebecers,
including Quebec federalists with their stuffed beaver policy, as
some radio commentators refer to Daniel Johnson's policy.
(1330)
Even Liberal members from Quebec-and I see some
members across the way who were in the National Assembly
before and are very much aware of Daniel Johnson's political
allegiance-even Mr. Johnson said yes, Quebec should have at
least 25 per cent. I think Quebecers are unanimous on this.
I am sure there is some formula we could use in this House to
rescind the vote at the report stage and include the motion
presented by the Bloc Quebecois. I think that, all things
considered, after everything we read in the papers and all the
pressure on the Liberals across the way in connection with the
Bloc's motion, which was entirely legitimate, I am sure there is
some way to rescind this vote and guarantee 25 per cent of the
seats for Quebecers.
Mr. Jean-Paul Marchand (Québec-Est, BQ): Mr. Speaker,
I have a question for the hon. member.
How does he see the role of members from Quebec who
support this bill? Does he think that members from Quebec who
support this bill are defending Quebec's interests?
Mr. Bellehumeur: Mr. Speaker, I will try to answer this
question without commenting-I think there is a rule about
this-on how Liberal members from Quebec voted.
However, as I said in my speech, if a member from from
Quebec who was elected by Quebecers is truly here to defend
their interests, that member cannot do otherwise but vote in
favour of this motion which would guarantee 25 per cent of the
seats. We did not ask for the moon. We did not ask for
exceptional powers. We wanted this bill to recognize the fact
that Quebec was one of the two founding peoples. It was that
simple. It was easy to do. They could have put it in the bill.
I think the Liberals from Quebec understand this. They could
have put it in the bill if they had done some lobbying, something
Liberals are very good at. The members from Quebec could have
lobbied their own caucus and their own ministers to include in
this bill a clause mandating a group of parliamentarians to find a
way to let Quebec have 25 per cent of the seats as requested by
us, the Bloc Quebecois and by all Quebecers. But they did not. I
think the answer to the question from the hon. member for
Québec-Est is clear. I think the interests of Quebec demanded it
and that they failed to act accordingly.
[English]
The Acting Speaker (Mr. Kilger): Is the House ready for the
question?
Some hon. members: Question.
The Acting Speaker (Mr. Kilger): Is it the pleasure of the
House to adopt the motion?
Some hon. members: Agreed.
11669
Some hon. members: No.
The Acting Speaker (Mr. Kilger): All those in favour of the
motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. Kilger): All those opposed will
please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. Kilger): In my opinion the nays
have it.
And more than five members having risen:
The Acting Speaker (Mr. Kilger): Pursuant to Standing
Order 45, the division on the question now before the House
stands deferred until tomorrow at 5.30 p.m., at which time the
bells to call in the members will be sounded for not more than 15
minutes.
* * *
(1335 )
Hon. Fernand Robichaud (for the Minister of Agriculture
and Agri-Food, Lib.) moved that Bill C-75, an act to amend the
Farm Improvement and Marketing Co-operatives Loans Act, be
read the second time and referred to a committee.
Mr. Lyle Vanclief (Parliamentary Secretary to Minister of
Agriculture and Agri-food, Lib.): Mr. Speaker, it is a pleasure
to open the debate at second reading on behalf of the Minister of
Agriculture and Agri-Food and the government.
Bill C-75 is an act to amend the Farm Improvement and
Marketing Co-operatives Loans Act. The acronym I will be
referring to is FIMCLA. This amendment would only change
one clause in the act. However, without the amendment we
would have to suspend the program. Bill C-75 would increase
the total amount of loans guaranteed under the act over a
five-year period from $1.5 billion to $3 billion. Before I get into
the question of why we want to make this change, I will tell the
House a little about the FIMCLA program.
This program has been around for 50 years. It started with the
Farm Improvement Loans Act passed in 1943 and came into
effect in 1945. It was the first guaranteed loan program in
Canada and was followed by student and small business loans. It
is probably the most successful of all those programs.
At first the farm improvement loan program was intended to
help tenant farmers get access to funding to improve their farms
or farm living conditions. The guarantees were needed. They
could not offer the land as security since they were tenants.
Therefore they were unable to get bank loans. Over the years it
has been a very popular program especially in western Canada,
becoming increasingly popular throughout the nation.
Now farmers use the program to get loans of up to a maximum
$250,000 for a wide range of farm improvement programs and
projects such as acquisition of additional breeding stock, more
land, improvements to buildings, fencing projects, irrigation,
improved waste disposal facilities, et cetera. It could also be
used and is being used to try alternative farming methods,
whether organic farming or any other type of alternative method
that farmers are now so aggressively pursuing in the
diversification of their operations.
In addition, the program facilitates access to credit for farmer
owned marketing co-operatives for activities that add value to
the agricultural production. For example, a co-op could borrow
up to $3 million under FIMCLA to build a juice plant, or
something with vegetables or any other type of co-operative
dealing with further value adding and processing of agriculture
products.
Loans to co-operatives must be approved by the Minister of
Agriculture and Agri-Food. Under this program borrowers
benefit from interest rate savings of about 0.5 per cent and a
lower equity requirement usually around a minimum 20 per
cent.
The program is very popular and is becoming even more
popular every year. Five years ago the department began to
encourage credit unions and caisse populaires to make the
program available to their customers as well. This has added
about 600 new designated lenders throughout the country.
In towns which may only have one bank or one credit union or
no bank or no credit union, farmers often had to drive to another
town to get financing. With this change they suddenly had a lot
more lenders to work with. In addition, we have seen sustained
lower interest rates, higher farm equipment sales and an
improved farm debt situation in the last few years.
Not surprisingly, the number of loans registered under the
program has more than tripled from about 4,800 in 1990-91 to
nearly 18,500 in 1994-95. The value of those loans has climbed
from just under $82 million per year to $515 million per year.
This year we expect the loans to reach $550 million, bringing a
five-year aggregate to $1.4 billion. We expect that to remain
constant for the years ahead. At a level of a $3 billion cap we
will now be allowed to continue to offer the program. Most of
the new growth has taken place in Quebec and Alberta.
(1340)
Not long ago there was only a single lender using the program
in Quebec. Now the giant Caisse Populaire Desjardins
movement has become a major participant and Quebec has the
third highest number of loans of any province. Similarly in
Alberta, which has the second highest number of loans, the
Alberta treasury branches have become a significant lender
under FIM-
11670
CLA. However, Saskatchewan is still the biggest user of the
program.
This new growth has caused the government to propose this
amendment to increase the cap. If we do not, as I said before, the
program could reach its $1.5 billion cap in June of this year and
then we would have to suspend the program for about two years.
In preparation for this amendment we have consulted with the
people who are most closely involved in the FIMCLA program,
including major farm organizations like the Canadian
Federation of Agriculture as well as commercial lenders.
I would also like to address the inevitable question of why we
are increasing the cap on this program by $1.5 billion at a time of
government restraint. I want to make clear this amendment does
not in any way represent $1.5 billion in new spending. Over the
last 30 years the program costs have averaged slightly over $1
million a year. It is a loan guarantee, not a loan of the actual
money.
The 25-year net loss rate under FIMCLA has been about 1 per
cent. If we look at other government programs it shows the
dedication to repaying loans and the low loss in those loans in
the agricultural community over the years, a record it can be
proud of. This loss was a bit higher in the 1980s for obvious
reasons but we expect it now to stay at less than 1 per cent in the
foreseeable future.
The government has made a commitment to provide farmers
with the tools they need. FIMCLA is one such tool, an
inexpensive tool that offers a considerable amount of assistance
to the agri-food sector. It supports adaptation, diversification
and encourages regional development and job creation.
The government has recently increased the cap on small
business loans to a total of $12 billion for the same reason. Here
again we are asking for the assistance to increase the cap on the
Farm Improvement and Marketing Co-operatives Loans Act.
At this time I urge all members in the House to support the
amendment which will double the cap on loans under the Farm
Improvement and Marketing Co-operatives Loans Act and
enable this low cost support to farmers to continue. I look
forward to the support of all members in the House.
[Translation]
Mr. Jean-Guy Chrétien (Frontenac, BQ): Mr. Speaker, Bill
C-75, which we are debating this afternoon, is neither very long
nor complex. It may, in fact, be summarized in a single, very
simple, clause, which provides that the maximum of guaranteed
loans will increase from $1.5 billion to $3 billion.
As my colleague, the Parliamentary Secretary to the Minister
of Agriculture and Agri-food, has just pointed out, this refers
merely to loan guarantees. The government is not injecting an
additional $3 billion or $1.5 billion into the agricultural
sector-far from it. Bill C-75 is therefore simply an
amendment to the Farm Improvement and Marketing
Cooperatives Loans Act.
(1345)
I must say that, when I read the title of this bill, I thought it
was rather long. Like the Prime Minister, I counted the words.
There are 16 words in the name of the act. There could, in my
opinion, have been a lot fewer.
The amendment, therefore, is aimed at doubling the amount
and the number of loans guaranteed under the terms of this act.
The amendment simply increases the cap of guarantees for loans
given by banking institutions in response to increased demand.
The current cap is $1.5 billion, and with the adoption of Bill
C-75, the limit will increase to $3 billion. For many farmers,
this increase means greater access to financing.
Even though the bill concerns loan guarantees and not the
investment of new money, an important question arises: Will
taxpayers be bearing the costs of this increase directly?
Although we are talking about loan guarantees, the risk of non
payment remains, and, in the end, all taxpayers will have to foot
the bill.
According to data from the Department of Agriculture and
Agri-food, losses due to non payment or non reimbursement
represent more or less one per cent of the total loan guarantees.
Therefore, the cost of the program will be relatively low.
Nevertheless, one per cent of $3 billion could end up costing
Canadian taxpayers $30 million.
Therefore, for the good of the farmers, the Bloc Quebecois
will support the increase in the cap from $1.5 billion to $3
billion by supporting Bill C-75. In the present context, it is
almost impossible for the provinces to gain a little more
autonomy from the federal government. The only solution in the
short term, and it is only for farmers, I repeat, is to allow the
government to go ahead with Bill C-75.
However, I must point out that our support is based solely on a
concern that farmers get the financing they need and are entitled
to. Apart from this vital aspect, it is as clear as spring water that
we cannot allow duplication to pass without comment. I wish to
draw the attention of all my colleagues and especially you, Mr.
Speaker, to the fact that Bill C-75 involves duplication from two
levels of government, as I will explain to you.
The basic question we must ask ourselves is not only whether
the limit provided for in the act to amend the Farm Improvement
and Marketing Cooperatives Loans Act is high enough but
whether the program as a whole is relevant. According to
Agriculture Canada figures, the demand for loan guarantees is
growing. It is this excessive demand that justifies the limit
increase.
11671
Mr. Speaker, you know as well as I do that the cost of farms
has risen, as has the cost of buildings, of extensions. The cost of
farm machinery such as tractors and combine-harvesters has
gone up and even doubled in the last 10 years. The cost of
digging manure pits keeps going up. I think that increasing the
limit was justified.
(1350)
I will not deny the importance for farmers of having access to
financing in order to improve or expand their facilities. All the
more reason to make their lives easier and allow them to meet
their needs in a single place. More and more, Quebec favours the
single window concept at all levels. In Quebec, there are now
three organizations in place to help Quebec farmers who need
financing.
Last weekend, I met with several farmers including my friend
Bertrand Lacroix of Second Street in Disraeli, who explained to
me how complex our situation is. On the one hand, you have
Quebec's Société du financement agricole, which a few years
ago was called the Office du crédit agricole and which comes
under Quebec jurisdiction. On the other hand, you have the Farm
Credit Corporation, which comes under federal jurisdiction.
Thirdly, since there are 12 words in the bill before us this
afternoon, an act to amend the Farm Improvement and
Marketing Cooperatives Loans Act, from now on I will use the
acronym AAFIMCLA. You can see how complex this is. We are
really asking for it.
I am far from proud this afternoon of supporting this bill on
behalf of the Bloc Quebecois. Our accumulated deficit exceeds
$550 billion. While the deficit for this fiscal year will be close to
$40 billion, the government is increasing duplication and
overlap. This is a good example of overlap within the same
government. At the federal level, farmers can borrow either
from the Farm Credit Corporation or under the Farm
Improvement Loans Act. Why not consolidate all that? I am sure
tens of millions of dollars would be saved each year this way.
Not only would this government save tens of millions dollars
each year, but it would be much more efficient. It is even worse
for Quebec farmers, who have a third choice in the farm finance
corporation.
Saturday afternoon, the farm producer I was visiting told me
that he had had to shop around in order to finance his new
facility. He applied for all three and came to the conclusion that
the program that best suited his expansion needs-I am not
saying that it would be the same for everyone, but for him-was
the one offered by the Société de financement du Québec.
Another time, the Farm Credit Corporation could prove to be a
better choice. In this instance, he told me that he had weighed
the three programs against one another and that the best deal was
that of the Société de financement agricole, formerly known as
Quebec Farm Credit Bureau.
The bottom line is that a great deal of money is totally wasted
on programs administered by three separate agencies. In their
next budget, the various provincial governments, particularly
Quebec and Ontario, which are two large provinces, will
probably have to follow our finance minister's lead and hit their
taxpayers hard. They will have to account for moneys spent, in
my view, wastefully on duplication. In Quebec, we know what
duplication is. We have been aware of this for quite a while, and
that is why we would rather have our own tool box, with all the
tools required to develop fully, freely and completely.
(1355)
If the three programs I just mentioned are different, is it not
because appropriate resources are scattered in three different
places? What if the resources allocated to the other two agencies
were made available to the Société du financement agricole? I
would bet that it could provide new programs. It would be what
we call a single window.
The province may have set criteria and standards of its own,
which are not in line with what the federal government had in
mind. Let us assume, for example, that the Quebec farm finance
corporation's standards are higher that those set in bill C-75 for
whatever reason. By setting separate standards, the federal
government is once again interfering in provincial areas of
responsibility.
Rather than moving to my next point, Mr. Speaker, I could
stop here, and let you have the floor to call statements by
members, and I could continue after oral question period.
The Speaker: Certainly, dear colleague. I thank you for
letting me take the floor, as the saying goes.
It being 2 p.m., pursuant to Standing Order 30(5), we will now
proceed to Statements by Members.
_____________________________________________
11671
STATEMENTS BY MEMBERS
[
English]
Ms. Maria Minna (Beaches-Woodbine, Lib.): Mr.
Speaker, on Wednesday, April 19, a terrible and tragic event
took place in the heartland of America. The bombing of the
federal building in Oklahoma City has shocked the entire world.
The bombing has proven that no one is safe from the threat of
terrorist activities and that terrorism can strike anywhere, even
in the places that were once considered safe, as Canada
witnessed at the provincial legislature in Prince Edward Island
last week.
The most devastating aspect of the bombing is the number of
young children who were killed in the blast. I cannot
comprehend how anyone could possibly justify the taking of
lives, especially those of innocent children.
11672
To the citizens of Oklahoma City, I am sure I speak for all
members present when I say that our thoughts are with you at
this time of sorrow. May you find the strength to rebuild and
carry on. I am also sure that my colleagues will join me in
condemning the cowardly act of terrorism.
* * *
[
Translation]
Mr. Pierre de Savoye (Portneuf, BQ): Mr. Speaker, there are
events which generate sympathy and solidarity among peoples,
nations, individuals and communities.
We join all those who strongly denounce the bombing which
took place last week in Oklahoma City.
Regardless of who is responsible for the attack, and regardless
of the motives, it is totally unjustifiable that individuals or
organized groups would resort to such violence and acts of
terrorism.
The revolting attack in Oklahoma City against dozens of
innocent people, including children attending a daycare, is in
direct contrast with the values of tolerance, solidarity, respect
and democracy of our societies.
We want to send a message of sympathy and solidarity to the
injured, to the families and close ones of the victims, to the
community of Oklahoma City, as well as to all Americans.
* * *
[
English]
Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, I too
would like to pay tribute and attention to the terrible tragedy that
occurred in Oklahoma City last week on April 19. It truly was a
shock to the world.
Our sympathy goes out to all of those who lost friends and
family members in this cowardly assault on innocent people,
especially the children, both those who died and those who lost
their parents.
This is a disgusting, despicable crime committed by a sick
element of society, an element that one could not even imagine
exists in our land and in our nations all around the world.
I hope there will be better procedures established to detect
these people and foresee this potential danger to society. Justice
must be served swiftly against the cowards who committed this
heinous crime and a justice that will ensure the sentence fits the
crime.
Oklahoma, our thoughts and prayers are with you.
Mr. John Finlay (Oxford, Lib.): Mr. Speaker, today is Born
to Read Day.
Nearly two million school children in Canada from
kindergarten to grade 3 will receive a free copy of ``Born to
Read'', a how-to guide encouraging parents to spend more time
reading with their children.
Writer and cartoonist Ben Wicks, realizing just how serious a
reading problem Canada has and recognizing that literacy
begins at home, decided to develop a book explaining to parents
how they can help their children to love to read.
This project is a joint effort of some of Canada's largest
corporations, federal and provincial governments and the five
major literacy organizations in Canada.
Twenty-four per cent of Canadian adults are functionally
illiterate. As a former educator, I find this statistic appalling. I
am well aware of the benefits literacy provides and I thank Ben
Wicks for the significant role he has played in addressing this
problem and trying to do something about it.
* * *
Mr. John Harvard (Winnipeg St. James, Lib.): Mr.
Speaker, this is my first opportunity from the floor of the House
of Commons to congratulate Canada on winning the World
Curling Championship.
The team consists of skip Kerry Burtnyk, third Jeff Ryan,
second Rob Meakin and lead Keith Fenton. This outstanding
foursome curls out of Winnipeg's Assiniboine Memorial
Curling Club which is located at the end of the street where I
live. I humbly confess to some local pride.
The Burtnyk team, however, are true world champions. They
swept the tournament in Brandon, winning all 11 games and the
coveted crown on a spectacular last rock double takeout in the
final match against Scotland.
Their victory highlights an outstanding season for Manitoba
curlers, a season that saw Manitoba teams win two world crowns
and two national championships.
Again, my congratulations to Kerry Burtnyk, Jeff Ryan, Rob
Meakin and Keith Fenton. They are the world's finest for '95.
They are great citizens of Manitoba, the hotbed of curling in
Canada.
* * *
Mr. Stan Keyes (Hamilton West, Lib.): Mr. Speaker, some
of the best doctors in the world are located right here in Canada.
11673
However, doctors in the province of Ontario are still reeling
from three consecutive years of ill-treatment by Bob Rae's NDP
government. So far the Rae government has failed to establish
meaningful co-operation with stakeholders in the health care
system in order to make better decisions about the planning and
delivery of health care services. For example, there should be
incentives for people to use community clinics instead of
hospital emergency wards which are five times more expensive.
Furthermore the Rae government has offered little or no
support to the medical profession in its efforts to develop new
payment models in order to manage costs. Doctors in Ontario
are being squeezed by the Rae government in a way that is
compromising their capacity to deliver medical services.
Innocent patients are getting caught in the crossfire.
Ontarians are fed up. It is time for new and effective
leadership in this province. Ontario needs a provincial
government that is committed to quality health care.
* * *
[
Translation]
Mr. Michel Daviault (Ahuntsic, BQ): Mr. Speaker, the Bloc
Quebecois joins with all Armenians to commemorate the 80th
anniversary of the Armenian genocide, which began in April
1915. This despicable crime against humanity must not be
forgotten.
The obvious lack of leadership shown by Canada regarding
this unpunished crime is upsetting. Under René Lévesque,
Quebec did recognize the Armenian genocide. The Liberal
government shows a blatant lack of courage and
clear-mindedness by continuing to ignore this genocide.
On behalf of all Quebecers and Canadians, the Bloc
Quebecois does remember this tragedy and does sympathize
with the Armenian people.
* * *
[
English]
Mrs. Diane Ablonczy (Calgary North, Ref.): Mr. Speaker,
the Schizophrenia Society of Canada is launching a major
campaign today to dispel the myths and misconceptions about
schizophrenia and to raise public awareness regarding the real
symptoms and the impact of the disease. The theme of the
national campaign is: ``If you think spelling it's hard, imagine
living with it''.
(1405)
Schizophrenia will affect one out of every 100 persons, or
about 270,000 Canadians. It is one of the most common forms of
mental illness. Sadly, 40 per cent of people with this disease will
attempt to take their lives. Sadder still, one-quarter of those will
succeed.
Schizophrenia is caused by a chemical imbalance in the brain
and typically strikes people in their late teens or early twenties,
often lasting a lifetime.
I applaud the efforts of the Schizophrenia Society of Canada
as it works to alleviate the suffering caused by this disease.
* * *
Mr. Len Taylor (The Battlefords-Meadow Lake, NDP):
Mr. Speaker, this past weekend the Yellowhead Highway
Association held its 49th annual meeting in Edmonton. This
organization, representing communities along the Yellowhead
highway from Winnipeg, Manitoba to Merritt and Masset, B.C.,
has helped to improve safety, business and tourism along
western Canada's most popular travel route.
Despite the significant success of the association, much
remains to be done, requiring the ongoing and continuous
commitment of provincial and federal governments. This means
that the federal government must remain committed to the
national highway system and to keep in place the resources
necessary to upgrade and enhance the travel convenience
provided by the new Trans-Canada Yellowhead Highway.
I urge the Minister of Transport to join the many dedicated
people in western Canada who support the Yellowhead, to
review his withdrawal of support from the national highways
program and to renew the financial commitment that is so
necessary to keep this highway functioning.
* * *
Mr. Eugène Bellemare (Carleton-Gloucester, Lib.): Mr.
Speaker, I wish to express my thanks to Ben Wicks, one of our
great Canadian cartoonists, whose book entitled ``Born to
Read'', was distributed today in over 10,000 schools across
Canada.
His book was officially released this morning in a ceremony
he attended on Parliament Hill in the presence of Governor
General Roméo LeBlanc and Senator Joyce Fairbairn, the
minister responsible for literacy.
[Translation]
As an amateur caricaturist and former teacher, I am very
proud of the tool Ben Wicks is offering to parents of young
children. It will make their first reading lessons interesting as
well as educational.
As well, I am convinced that this book will be a great help in
the fight against illiteracy.
11674
[English]
Thank you, Ben Wicks and congratulations.
* * *
Hon. Roger Simmons (Burin-St. George's, Lib.): Mr.
Speaker, the National Junior/Juvenile Judo Championships were
held in Newfoundland this past weekend for the first time in 20
years. The town of Stephenville, in my riding, played host and
did an absolutely bang-up job. I was there to help them celebrate
the spirit of this tremendous sporting event.
Three hundred competitors from all 10 provinces took part,
including Jeremy Delaney, Eric Hynes, Gary Lasaga and Jeff
Pollard, all from Stephenville.
Newfoundlanders take great pride in their team, which
captured its very first gold medal in a national judo competition.
Congratulations to everyone, including Aden White, William
MacNeil, Della McIsaac, Rodger Farrell, the athletes, coaches,
officials and volunteers. For Aden White especially, it was a
dream come true. Well done all.
* * *
Mr. Leonard Hopkins (Renfrew-Nipissing-Pembroke,
Lib.): Mr. Speaker, I rise today to pay special tribute to the
House of Commons Security Services which celebrate their 75th
anniversary this year.
It was in 1920, following an act of Parliament, that the House
of Commons protective staff was created to protect the
parliamentary institution, its members and the precinct. This
force has since grown into the efficient, effective and
professional force we know today. Both proactive and reactive,
the House of Commons Security Service has continuously
aimed to provide the excellent service to which we have become
accustomed.
The men and women of the security staff are continuously
faced with the almost impossible task of providing security in
such a way as not to limit or impede public access into the
buildings, while ensuring on the other hand that sufficient
security is present to adequately protect members of Parliament,
employees, visitors and tourists in a period when crime and
terrorism are on the increase.
As an honorary member of the security services I invite all
members to join with me in wishing them a happy 75th
anniversary as well as many more years of success.
(1410)
[Translation]
Mrs. Pauline Picard (Drummond, BQ): Mr. Speaker, not
only has the ``No'' side nothing to offer Quebecers in the
upcoming referendum, but more importantly, the Liberal Party
in Quebec has begun to shun Quebec's traditional claims.
Federalists have offhandedly dismissed four of the five
conditions set during the Meech Lake negotiations, at the time
considered to be a bare minimum by the Liberal Party, and now
propose to promote Quebec's development and to define its
place in the Canadian federation through obscure administrative
agreements.
Administrative agreements have never been used to
acknowledge a people's existence or to grant them the powers
they need to develop. The Liberal Party is not proposing ``quiet
affirmation'' but more a strategy of ``quiet resignation''.
* * *
[
English]
Mr. Jack Frazer (Saanich-Gulf Islands, Ref.): Mr.
Speaker, ethnic dissension again erupted in Rwanda on Saturday
as the world witnessed yet another massacre of thousands of
Hutu refugees by Tutsi government soldiers.
Previous, smaller group killings of Rwandan refugees have
given clear notice that it was only a matter of time before
Saturday's massacre would occur. Yet once again, the world and
the United Nations stood by, only able to watch helplessly as
these events unfolded before our eyes.
In this 50th anniversary year of the United Nations, events
such as this make it critically vital that international
communities work together to agree to reform United Nations
structure and procedures to enable the UN to respond effectively
at short notice so that atrocities such as the tragic massacre
witnessed this weekend will become a thing of the past.
In the meantime, the international community should ensure
that those responsible for perpetrating this horror are identified
and punished. Only in this way can it be made clear that the
world cannot and will not accept such behaviour.
* * *
[
Translation]
Mr. Patrick Gagnon
(Bonaventure-Îles-de-la-Madeleine, Lib.): Mr. Speaker,
the week that just drew to a close was
11675
tarnished with acts of unprecedented violence which must be
categorically condemned by all.
Our so-called industrialized societies seem to have become
the preferred targets of hatemongers and assassins. Whatever
the motives of the perpetrators of such savage and senseless
acts, their murderous rampages can never be considered
justifiable.
I am calling on all of the members of this House and all
Canadians to join in the fight against intolerance and hatred in
our society.
* * *
[
English]
Mr. John Godfrey (Don Valley West, Lib.): Mr. Speaker,
following on the remarks of the previous member, like all
Canadians I am sure that all members of the House join me in
their condemnation of the continuing atrocities in Rwanda. This
weekend we learned of yet another attack on innocent civilians
and the death of several thousand Rwandan citizens.
There comes a time when the long accepted international
principle of the absolute right of national sovereignty to take
priority over all other rights must be put aside in the name of
international human rights and common decency.
I suggest that the citizens of Rwanda, like those of Somalia or
the former Yugoslavia possess inalienable rights of freedom and
life. Quite clearly these rights no longer exist. The Rwandan
government must be held accountable for the actions of its army
and justice must be served.
I believe that Canadians have a role to play in achieving peace
in this region. We have been and continue to be a world leader in
the fight for peace. There is no place in this world for mass
murder and ethnic cleansing. The voice of peace and freedom
must be heard.
* * *
Mr. Ed Harper (Simcoe Centre, Ref.): Mr. Speaker, the
people of Ontario are a caring people. Throughout the history of
this province they have contributed generously to
confederation.
This generosity, however, is being put to the test by the
government. Despite electing 98 Liberal MPs in the last
election, issues that concern Ontario are not being addressed.
Nothing exemplifies this lack of representation more than the
growing smuggling problem.
The Liberal solution to smuggling announced last February
has failed to stem the tide of guns, alcohol, drugs and tobacco
streaming into Ontario. Smuggling accounts for the vast
majority of cases involving the criminal use of firearms in
Ontario and it facilitates the illegal use of drugs. It has cost
thousands of jobs in the distilling industry and the government
has lost billions of dollars in revenue.
The old saying about safety in numbers obviously does not
apply to Ontario's voice in Ottawa.
* * *
(1415 )
Mrs. Jean Payne (St. John's West, Lib.): Mr. Speaker, the
week of April 23 to April 29 is National Volunteer Week in
Canada. This week communities all across our great nation pay
tribute to those people who volunteer their time and skills to
help their fellow Canadians.
National Volunteer Week was first proclaimed in 1943. Now,
over 50 years later, we take this week to recognize the
contributions that volunteers make to our way of life. From the
people who sit on the boards of community support
organizations such as St. John Ambulance to hockey coaches
who give up their Saturday mornings to show children the joy
and value of team work volunteers give the most valuable gift of
all: their time.
In particular I take this opportunity to recognize the
contributions of a constituent of mine, Mr. John O'Regan, who
was named volunteer of the year by the Newfoundland and
Labrador Chamber of Commerce for his many years of
outstanding and dedicated community service.
I invite all members of the House to join with me in paying
tribute today to all Canadians who volunteer their time and
skills to make Canada the great nation it is.
_____________________________________________
11675
ORAL QUESTION PERIOD
[
Translation]
Hon. Lucien Bouchard (Leader of the Opposition, BQ):
Mr. Speaker, last Friday when he visited the Valcartier military
base, the Prime Minister said that Quebec City lost the G-7
Summit because the Canadian flag is not flown from the city
hall.
My question is directed to the Prime Minister. I want to ask
him whether he does not think it was rather petty to disqualify
Quebec City just because of a flag?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, Halifax was selected on the merits of its location. The
first economic summit was held in Quebec at Montebello. The
second summit was held in Toronto, and we decided to have the
third one in Halifax, in the Maritimes where occasions like this
one are few and far between. At the time, we received
representations from a number of people from Quebec City and,
as I said at the time, it is not very pleasant when the mayor of a
city in
11676
Quebec comes to ask favours from the Canadian government
and refuses to show the flag of his country, the Canadian flag.
When the Prime Minister of Canada was about to invite
international leaders to Quebec City, the mayor was not
prepared to show that he himself was a Canadian.
Hon. Lucien Bouchard (Leader of the Opposition, BQ):
Mr. Speaker, no one in Quebec is asking favours from anyone,
and especially not the mayor of Quebec City in his capacity as
mayor. We pay taxes here. We pay taxes. This is our money you
are spending, and we want our fair share. And we are certainly
not seen as begging favours from the federal government.
Some hon. members: Hear, hear.
Mr. Loubier: It costs us $30 billion in taxes.
Mr. Bouchard: Mr. Speaker, are we to understand that this
petty and mean decision on the part of the Prime Minister to
disqualify Quebec from hosting the G-7 summit was inspired by
the same desire to get even that permeated the government's
actions on MIL Davie, manpower training and cuts in transfer
payments for social programs, to punish Quebeckers for
supporting the Parti Quebecois and the Bloc Quebecois?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, I see the Leader of the Opposition is easily upset, but
despite the lack of courtesy shown by the mayor of Quebec, we
support the interests of Quebec City, which is borne out by the
fact that throughout the world at this very moment, Canadian
ambassadors are trying to get the 2002 winter games for Quebec
City, in spite of the mayor of Quebec City.
Hon. Lucien Bouchard (Leader of the Opposition, BQ):
Mr. Speaker, if the Prime Minister thinks all sovereignist
mayors in Quebec are discourteous, since there are quite a few
of them, that means there are quite a few discourteous mayors in
Quebec. There are quite a few people in Quebec who are
discourteous, in that case, and they will show it when all
sovereignists join in making the referendum this fall a victory
for sovereignty.
Some hon. members: Hear, hear.
Mr. Loubier: We will win that one.
Mr. Bouchard: Are we to conclude from what the Prime
Minister said in Valcartier that his only strategy now is to scare
Quebeckers before the referendum that will be held shortly?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, the Leader of the Opposition wants a referendum as
soon as possible. That is not what he told Parizeau last week. If
the Leader of the Opposition wants to win the referendum, the
question should be very simple and very clear. Ask Quebeckers:
Do you want to stay in Canada? And we will all vote yes,
including the Péquistes.
Some hon. members: Hear, hear.
* * *
(1420)
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, my question is for the Solicitor General.
Last September, Michel Robert, spokesperson for the
Security Intelligence Review Committee told the
Sub-committee on National Security that he did not know what
had become of Grant Bristow. The Toronto Star has uncovered
him in Edmonton, complete with a new identity, a new house,
two cars and an income of $3,000 a month, compliments of the
Government of Canada and Canadian taxpayers.
Before providing Mr. Bristow with a new identity and sending
him into hiding once again, would the Solicitor General
acknowledge that Mr. Bristow must appear before the
Sub-committee on National Security in order to fully clarify his
role in the racist group Heritage Front and his infiltration into
the entourage of the leader of the Reform Party.
[English]
Hon. Herb Gray (Leader of the Government in the House
of Commons and Solicitor General of Canada, Lib.): Mr.
Speaker, it has never been confirmed that Grant Bristow is a
CSIS source or was a CSIS source. As a result I do not think
there is anything further I can add in reply to the hon. member's
question.
[Translation]
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, how can the Solicitor General abdicate his
responsibilities with regard to Grant Bristow's role as a CSIS
source, when a report by the review committee considers that
Mr. Bristow exceeded the mandate of a CSIS source.
Why is the Solicitor General making such an effort to hide
Grant Bristow?
[English]
Hon. Herb Gray (Leader of the Government in the House
of Commons and Solicitor General of Canada, Lib.): Mr.
Speaker, I think my hon. friend is mistaken. The report of the
SIRC, the Security Intelligence Review Committee, did not
confirm that Grant Bristow was a source of CSIS. It did however
confirm that CSIS did a good job, a proper job and a necessary
job investigating the Heritage Front.
11677
Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker,
tomorrow the federal cabinet will do something it has never
done before. It will issue a cabinet directive overturning a CRTC
decision on direct to home satellite television at the specific
request of Power Corp.
In fact Power Corp. went so far as to say that it would
withdraw its bid if the cabinet did not rule in its favour. It is
amazing what one can accomplish when one has friends or
fathers-in-law in high places.
My question is for the Prime Minister. If the government felt
so strongly about opening satellite television to competition,
why was it not done through the appropriate channels and why is
Power Corp. running the show?
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, I am sorry the usual critic is not here. Perhaps she
would understand the process a little better. The hon. member
will know-
Some hon. members: Order.
The Speaker: We have been away for a little while and
probably have forgotten that we do not make reference to when
members are here or not here. I would ask the hon. minister to
keep that in mind when answering.
Mr. Manley: Actually, Mr. Speaker, I am never quite sure
when the members are here or when they are not here.
The hon. member should be aware the concerns the
government expressed about the order the CRTC issued last
summer were precisely along the lines of the question he puts.
The CRTC authorized the consortium to initiate a direct to home
satellite service in Canada without issuing a licence and without
any public transparency process, by issuing an exemption order
which has the effect, as the hon. member should know, of
creating a monopoly in this service in Canada.
(1425)
If the Reform Party is in favour of a monopoly in services and
opposed to a transparent licensing system then let it say so. That
seems to be the implication of the question.
Mr. Jim Silye (Calgary Centre, Ref.): I guess, Mr. Speaker, I
get to see arrogance in its visual form.
The Reform Party favours open competition and a firm policy
that safeguards the best interest of the country and Canadians.
However, if questions are being raised about the propriety of the
deal the government has no one to blame but itself. Power Corp.
said jump, and the cabinet and the Prime Minister asked how
high by using special powers to overturn the CRTC original
decision. This was all being done behind closed doors. Certainly
consumers may benefit in the end but the end does not justify the
means.
My supplementary question is for the minister. Will he assure
the House that any further decisions on the direct to home
satellite industry will be taken in full public view and not behind
closed doors at special cabinet meetings?
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, it is hard to avoid being accused of arrogance when the
member's question is full of factual errors.
The reality is that we invited the panel of experts to conduct
an open and transparent process. All the submissions received
by the review panel were publicized with time for public
response to the submissions, unlike the issue of the exemption
order in the first place.
If cabinet decides that it will accept the recommendations of
the review panel it would do so in a statutory and transparent
way by referring such an order to the House of Commons and to
the Senate for review over a period of 40 days. That is what the
law provides. It is entirely open and entirely transparent. If we
decide to do so, the member and other members of his party will
be most welcome to make their submissions well known both on
competition as well as on the future of DTH services.
Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, with the
cabinet's unprecedented use of special powers to overturn a
CRTC decision, which contradicts the red book promise of open
government, the federal government is now becoming more
powerful and more secretive.
For instance, the regulatory efficiency act will give the
cabinet power to exempt companies from regulations through
special private compliance plans. The potential for abuse is
staggering. Canadians should be driving the country's agenda,
not cabinet and special interest groups. The system must be
transparent.
Will the government scrap the regulatory efficiency act
immediately and keep power in the hands of Parliament where it
belongs?
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, again the preamble to the question misses the point of
what is proposed in the issuance of a direction to the CRTC. Yes,
it is the first time but the act was passed only a short time ago; it
is one of the first opportunities to exercise the power. However it
is very carefully circumscribed in the Broadcasting Act.
Therefore it is important for us, if we make that choice, to do so
in a way that complies with the act, that is transparent and that is
open. This is the essence of what we are trying to accomplish
with respect to the order.
As far as the regulatory efficiency act is concerned the
member is entitled to engage in debate about it, but he should
understand that one of the objectives of the act is to ensure that
11678
we reduce the burden particularly on small and medium size
business in order to make the economy grow.
If the Reform Party wants to increase the regulatory burden on
business then let it say so.
* * *
[
Translation]
Mr. Pierre Brien (Témiscamingue, BQ): Mr. Speaker, my
question is for the Prime Minister. In the last election campaign,
the Prime Minister vowed to abolish the GST before January
1996. He said that they hated this tax and that they would scrap
it. Last week, we learned that the government would not review
the GST before January 1, 1996.
(1430)
Are we to understand from this further deferral of GST reform
that the Prime Minister has reneged on his election promise to
scrap the GST and now intends to maintain the mess and the
inequities generated by the GST?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, the answer is no.
Mr. Pierre Brien (Témiscamingue, BQ): Mr. Speaker, can
the Prime Minister undertake before this House not to take
advantage of the probable election of a Liberal government in
Ontario to review the GST without Quebec's consent?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, I am happy to see that the hon. member predicts a
Liberal victory and I thank him for it. As for our commitments
with regard to the GST, we are looking for a way to replace this
tax. We wrote in our red book that we wanted to replace it.
The red book lists the conditions to be met and mentions in
particular that the solution must be co-ordinated with the
provincial governments, including the government of Quebec.
* * *
[
English]
Mr. Ray Speaker (Lethbridge, Ref.): Mr. Speaker, the
government keeps telling Canadians that everything is okay yet
in light of Moody's downgrade it should be obvious it is not.
If the government's fiscal plan is so good, then can the Prime
Minister tell us why since the government's first budget interest
rates have risen by more than 400 bases points? Why have
five-year mortgage rates risen more than 2 per cent costing
homeowners an extra $300 per month on a $100,000 mortgage?
Also, why has the dollar lost over 20 per cent of its value versus
the yen and the mark?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, the fundamentals of our economic policies have been
recognized as being very good.
Again this morning the IMF predicted the best level of growth
for Canada this year. Inflation in Canada is among the lowest in
the world. Of course there is some increase in interest rates due
to circumstances that are not necessarily under our control.
We are working to reduce interest rates. We have seen the
Canadian dollar grow in value a bit lately and interest rates are
going down. The economic policies of the government will
produce the result we want and will create the jobs that are
needed for our economy.
Mr. Ray Speaker (Lethbridge, Ref.): Mr. Speaker, some of
those are short term goals that certainly do not fit a long term
fiscal plan which must deal with the problems of Canada.
The Prime Minister should recognize that since the
government came into power, higher interest rates have
hammered the housing industry. Resales for March were down
42 per cent from a year ago. At the same time a rising inflation
rate of some 2 per cent for the month of March is forcing the
Bank of Canada to continue to keep interest rates relatively
high.
Does the Prime Minister not realize that his government's
weak fiscal policy is forcing the Bank of Canada into the
impossible position of trying to support the dollar, contain
inflation and bring down interest rates all at the same time?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, over the weekend the governor of the bank said that the
policies of the government are on the right track and that the
budget is the right one.
I am happy to see that the Leader of the Opposition has
changed his mind again and wants to have a referendum very
early. When we have settled the problem of the referendum
everything will be better for the economy of Canada.
* * *
[
Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, after putting Canada's credit rating under review 11
days before the budget, the rating agency Moody's decided, on
April 12, to cut the Canadian government's credit rating.
Moody's decision is based on a hard look at the inadequate
spending and deficit cutting measures, in the middle-term,
which are contained in the budget.
My question is for the Prime Minister. Does he agree that the
cut announced by Moody's confirms the official opposition's
contention that the government made bad decisions, did not cut
11679
deeply enough in the federal administration, and did not review
its fiscal policy in spite of the terrible state of public finances,
preferring instead to transfer its deficit to the provinces?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, Moody's announcement was met with skepticism since
the very next day the value of the dollar increased on
international markets, while interest rates decreased.
(1435)
All the other observers greeted the budget with enthusiasm
when it was tabled, back in February. Moody's was not in a good
mood on that day. These things happen. While the mood
changed for that agency, it remained the same for the rest of the
world.
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, the Prime Minister is joking about the serious and even
catastrophic situation of Canada's public finances.
Mr. Bouchard: Absolutely.
Some hon. members: Hear, hear.
Mr. Loubier: Does the Prime Minister realize that if the
government's credit rating is cut in spite of the sustained
economic recovery, it is because Moody's was not fooled by the
wait-and-see policy of its government, which is content to rely
on short-term economic recovery, which passes its deficit on to
the provinces, and which lets the $550 billion debt grow by the
minute, instead of tackling the real problems? This is the real
situation.
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, just today, the International Monetary Fund released a
report indicating that Canada's economic performance is one of
the best in the world. Three weeks ago, when I was in
Washington, I had the opportunity to meet the director general
of the IMF who congratulated me on the Minister of Finance's
budget.
One agency did make a negative assessment, but the vast
majority of credit rating agencies and observers, and
particularly the markets, gave good marks to the Canadian
government, following the budget tabled at the end of February.
* * *
[
English]
Mr. Art Hanger (Calgary Northeast, Ref.): Mr. Speaker, in
the last budget the immigration minister decided to levy a new
$975 tax on refugees and immigrants to pay for settlement
services. He said that those who could not afford this tax would
be loaned the money to cover the costs.
How does the immigration minister intend to pay for the
massive bureaucracy which will be necessary to administer the
loans that pay for the tax? It is a tax because it is going into
general revenue.
Hon. Sergio Marchi (Minister of Citizenship and
Immigration, Lib.): Mr. Speaker, the $975 that was announced
by the Minister of Finance on budget night is a landing fee and a
recovery of program costs. The member should know that all
cost recovery fees of the entire federal government go into
general revenue.
The member seems to be arguing. When it came out he and his
party were in favour. Then at committee they said they were
opposed if it went into general revenues and not into the
department, which really does not impact the bottom line.
The fact is that the landing fee is the best way of ensuring that
settlement for immigrants and refugees continues. It is the best
option of a series of alternatives that were certainly not as
progressive.
I would like to know on any given day where the Reform Party
stands on this issue.
Mr. Art Hanger (Calgary Northeast, Ref.): Mr. Speaker, if
the truth be known, the collection services of this government
are disastrous. It cannot even look after the sponsorship
agreements.
Only this minister could see the logic in expanding a
bureaucracy to administer loans to finance a tax to offset
runaway immigration costs when the money does not go into the
immigration department at all.
Why did this minister choose to expand the size and cost of his
immigration empire and impose a new tax when he could have
easily cut the number of immigrants who require settlement
services and make those who need them pay their own way like
other countries do?
Hon. Sergio Marchi (Minister of Citizenship and
Immigration, Lib.): Mr. Speaker, now we get to the true
Reform agenda, hiding behind some fictitious tax.
It is not going to increase the so-called empire. If the member
does his parliamentary homework, he will note that in the
estimates there are no such increases that the member speaks of.
We already collect a transportation loan from refugees.
He talks about payback. Let me tell the hon. member that
since 1951 refugees have paid back the transportation loans of
$3,000, $4,000, $5,000 to the tune of 97 per cent. There is no
increase in the bureaucracy.
* * *
[
Translation]
Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ):
Mr. Speaker, my question is for the heritage minister. Recently,
11680
the president of Power DirecTv issued an ultimatum to the
government saying: ``If you do not take any action by April 24,
we will have to cancel our plans''. This means that the federal
government intends to overturn a CRTC decision by order in
council.
Can the heritage minister tell us whether there is any
justification for his government's eagerness to bulldoze the
CRTC on the issue of satellite TV other than to please the
government's friends who are legion at Power Corporation?
(1440)
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, as the member knows, it is a concern we also have
regarding the information highway.
On numerous occasions, we have stated that we favour a
competitive system. It is not very clear whether Bloc members
are for or against competition or for a transparent satellite
broadcasting licensing system; however, it is clear that nearly
all the comments on the report presented to the government on
April 6 have been positive. Probably the most significant critics
came from Power Corporation, which was not very happy with
the report.
Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ):
Mr. Speaker, my supplementary question is for the heritage
minister.
How can the minister deny that there is now a possibility for
Power DirecTv to do like Expressvu and broadcast via satellite?
This is to abide by the CRTC's ruling.
Why then prevent Expressvu from broadcasting and make it
go through a different process just for the sake of pleasing Power
DirecTv?
[English]
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, I am sure the hon. member, when she thinks about it,
will realize that it is better to have a process in place such as that
for licensing other concerns which is transparent, open to public
discussion and debate, and open to appeal, rather than the
indirect method of an exemption order that was applied by the
CRTC in this case. One of the reasons we referred the matter to
the panel of experts was in order for them to look at the question
of what the process was and whether it was an adequate process.
I think in the end the hon. member will agree that the
application for licensing, if indeed we introduce the order
proposed by the panel of experts, is one which will give an
opportunity to everyone meeting certain qualifications which
are very consistent with those that apply to cable television
operators for example. It will provide funding for Canadian
culture and other endeavours to be pursued by everyone
interested in providing this kind of service.
Mrs. Eleni Bakopanos (Saint-Denis, Lib.): Mr. Speaker, my
question is for the Minister of Industry.
A month ago Bell Canada announced the elimination of
approximately 10,000 jobs. Recently we were informed of
financial difficulties at Unitel which could lead to more layoffs.
In light of these developments, what is the government's
position on competition in the Canadian telecommunications
market?
Hon. John Manley (Minister of Industry, Lib.): Mr.
Speaker, once again I want to restate the commitment the
government has in this sector broadly to competition as being
the best means of ensuring that we have the lowest prices, the
broadest possible choice, and the greatest range of innovation.
This is a sector which perhaps of all sectors is one of the most
globally competitive. It is one of the ones that is most important
as a component to costs in Canadian business and therefore a
competitive structure is one that commends itself to us.
At the same time of course we share the concerns that I am
sure the hon. member is representing in realizing that a lot of
firms are going to go through adjustment periods and perhaps in
many cases will be downsizing. I believe it is a temporary
phenomenon. In time the number of jobs created in the
information technology sector is going to far outweigh the
number of jobs that are lost in the short term adjustment period.
* * *
Mr. Ed Harper (Simcoe Centre, Ref.): Mr. Speaker, an
unbelievable lawsuit has been launched against the Government
of Ontario by sponsored immigrants. They are suing Ontario for
deducting $100 from their welfare cheques despite the fact their
sponsors have reneged on their signed guarantee of full support.
Will the immigration minister be supporting the province of
Ontario in its defence, especially in light of the $700 million
that this abuse costs Canadian taxpayers?
(1445 )
Hon. Sergio Marchi (Minister of Citizenship and
Immigration, Lib.): Mr. Speaker, the hon. member is a little
late and should talk to the immigration critic.
In the immigration levels we put before the House last
November we were very clear about the plan with respect to
family sponsorships.
Mr. Ed Harper (Simcoe Centre, Ref.): Mr. Speaker, being
very clear and doing something about it are two different things.
11681
The minister has still not done what he said he would, to
institute a system of bonds for sponsors to cover these costs.
Since the province of Ontario has been able to identify those
who are abusing the system will the minister now enforce the
sponsorship contracts?
Hon. Sergio Marchi (Minister of Citizenship and
Immigration, Lib.): Mr. Speaker, it is the member who is
misinformed. The action is certainly under way.
We said very clearly we wanted to bring under control the
roughly 14 per cent of family class sponsorships that do fail,
keeping in mind the overwhelming majority of immigrants who
come here on family sponsorships play by the rules.
It was discussed at the committee. I hope he will consult with
the immigration critic and get caught up.
* * *
[
Translation]
Mr. Réjean Lefebvre (Champlain, BQ): Mr. Speaker, my
question is for the Minister of Foreign Affairs.
The Rwandan army has committed a real carnage on Saturday
when it opened fire with automatic weapons and grenades at the
Kibeho refugee camp. According to several sources, the army
killed several thousand Hutu refugees.
Could the Minister of Foreign Affairs tells us whether his
government made representations to the Rwandan authorities
asking for an end to this kind of behaviour, in Kibeho and
elsewhere?
Hon. André Ouellet (Minister of Foreign Affairs, Lib.):
Mr. Speaker, the Canadian government condemned in the most
vigorous way the massacre just described by the hon. member.
We immediately asked Ambassador Dusseault to go to the camp,
inquire and report as quickly as possible.
Mr. Réjean Lefebvre (Champlain, BQ): Mr. Speaker, are
the incidents which happened at the Kibeho refugee camp likely
to lead the government to reconsider its help and support to the
new government of Rwanda, considering also the numerous
rumours that circulate as to the diversion of Canadian help by
Rwandan authorities?
Hon. André Ouellet (Minister of Foreign Affairs, Lib.):
Mr. Speaker, it is obvious that this ruthless behaviour on the part
of the army puts in jeopardy all the efforts made over the last few
weeks to bring about reconciliation between the various groups
and factions.
Clearly, we will have to review our position at this time,
because we thought that the good faith and the efforts of the
government over the last few weeks seemed promising. We are
waiting impatiently for the report of Ambassador Dusseault and
we will act according to the recommendations he will make. I
will keep in mind the suggestions of the hon. member.
* * *
[
English]
Mr. Randy White (Fraser Valley West, Ref.): Mr. Speaker,
my question is for the Minister of Public Works and Government
Services.
I understand the minister of public works consulted with the
Minister of Transport about transferring $26 million from the
federal strategic highway improvement program allotted for the
bypass at Wentworth Valley in Nova Scotia. It is well known as
being one of the most dangerous stretches of road in the country.
Where were the funds transferred? To the minister's own
riding of Cape Breton, of course, for the construction of a tourist
road. How can the minister justify such a blatant conflict of
interest to Canadians?
Hon. Douglas Young (Minister of Transport, Lib.): Mr.
Speaker, I am sure the hon. member recognizes the allocation of
funds for highway construction, even though in part it may come
from the federal government, is a provincial responsibility.
I want to assure my hon. colleague the negotiations with the
province of Nova Scotia, as is the case with many other
provinces across the country, are ongoing and there are
reallocations which take place from time to time. However,
whatever reallocations are made are always on the basis of those
negotiations with the provinces, which are ultimately
responsible for not only the spending of the money but also for
the route selection.
(1450 )
Mr. Randy White (Fraser Valley West, Ref.): Mr. Speaker,
the fleur-de-lis trail, which the minister is sort of talking about,
does not come under this funding program. The agreement was
changed by the minister of public works and the Minister of
Transport. The auditor general of Nova Scotia is saying they
cannot justify the change that was made.
How can the minister sacrifice the safety of Canadians for the
tourist trade in Cape Breton?
Hon. Douglas Young (Minister of Transport, Lib.): Mr.
Speaker, it is usual to answer a question asked by a member who
knows better.
The reallocation of funds under this agreement and any other
agreement comes as a result of requests from provincial
governments. It does not just occur in Nova Scotia; it occurs on a
regular basis. The extent to which provinces exercise their
jurisdiction for spending money on highways and determining
where those highways should go is something the hon. member
should know.
11682
The Government of Nova Scotia has announced recently the
construction of a highway along, I gather, where the member
thinks it should have gone originally. We are very pleased to be
participating in that project as well.
* * *
Mr. Sarkis Assadourian (Don Valley North, Lib.): Mr.
Speaker, my question is for the Secretary of State for
International Financial Institutions.
Life insurance polices classify flying, racing, boating,
snowmobiling and hot air ballooning as hazardous sports. Since
hundreds of Canadians die or are injured every year in gun
related activities, what action can the secretary of state take to
ensure gun activities are classified also as hazardous sports by
life insurance companies in Canada?
Hon. Douglas Peters (Secretary of State (International
Financial Institutions), Lib.): Mr. Speaker, I thank the hon.
member for his question.
As the hon. member knows, such decisions are taken by the
insurance companies. He should take it up with them. It would
not be appropriate for the government to decide on
classifications and appropriate risk assessments. That is a
private sector decision which insurance companies make.
* * *
[
Translation]
Mr. Michel Gauthier (Roberval, BQ): Mr. Speaker, during
the March 27 meeting of federal Liberals from the Bourassa
riding, which the Secretary of State for Parliamentary Affairs
attended, the president of the Quebec wing of the Liberal Party,
Denis Coderre, made some derogatory remarks regarding
immigrants and refugees, to the effect that there should be a law
providing for the deportation of sovereignist immigrants.
My question is for the Prime Minister. Will he tell us whether
Mr. Coderre's remarks are indicative of the government's new
policy on immigration, despite the fact that he himself declared
yesterday that hatred, ethnic nationalism, religious fanaticism
and racism would not be tolerated?
Hon. Sergio Marchi (Minister of Citizenship and
Immigration, Lib.): Mr. Speaker, the hon. member's question
is surprising, since a member of the party to which he belongs,
the Bloc Quebecois, has already suggested that immigrants in
the Province of Quebec be denied the right to vote in the
referendum. In light of this, it is quite singular that the hon.
member raises the issue.
Mr. Coderre qualified his statement after the fact and I
consider the matter closed.
Mr. Michel Gauthier (Roberval, BQ): But, Mr. Speaker,
apologies were in order.
My supplementary question is for the Prime Minister. Does he
intend to demand a public apology from not only Mr. Coderre
but also his Secretary of State for Parliamentary Affairs,
because he was there when Mr. Coderre made his remarks and he
did not feel it was important, as a member of the government, to
immediately dissociate himself from them?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, his words are being taken out of context. The Liberal
Party has always been recognized as the pro-immigration party
in Canada. In my speech last night to international
parliamentarians from all parts of the world, I reaffirmed
Canada's values, which include tolerance. This is one of the
qualities that our party has prized for a very long time.
* * *
(1455 )
[English]
Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.): Mr.
Speaker, Transport Canada is undergoing the commercialization
or privatization of many parts of its government transportation
holdings. This includes air traffic control, air navigation
equipment, airports and CN Rail. Also being considered are the
Canadian ports, the St. Lawrence Seaway and possibly even
parts of the coast guard.
Given this high degree of planned privatization and the need
for the public to understand and accept this process, does the
Minister of Transport not agree the only way to ensure this is to
order an open and transparent public inquiry into all aspects of
the Pearson development contract process?
Hon. Douglas Young (Minister of Transport, Lib.): Mr.
Speaker, it is a winding and torturous road to get to that
question. I thank the hon. member for listing the objectives of
Transport Canada.
I do not want to comment on matters that are before the other
place, but I understand there is some consideration being given
to an inquiry there. I want to emphasize the importance the
government attaches to getting to work at Pearson, developing
the premier airport in Canada.
There can be all kinds of reasons in the minds of some to delay
the work that has to be done at Pearson. As far as we are
concerned the time has long past since we should have begun the
work of putting thousands of people into the construction
11683
project at Pearson International Airport, making it the kind of
crown jewel of our air system it should be.
Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.): Mr.
Speaker, I have never questioned the right of the government to
cancel the Pearson contract. With that right goes an obligation to
the Canadian taxpayer to show the need for the action, the cost
of the action and where the government will get the money for an
alternative.
Using the government's own figures, cancellation will cost a
minimum of $500 million if the rule of law is followed and the
crown construction option will cost another billion.
Where will the government get this $1.5 billion not in the
Liberal's latest budget?
Hon. Douglas Young (Minister of Transport, Lib.): Mr.
Speaker, the hon. member has come directly to the point with his
supplementary question.
There is no question that if we continue the process that some
are on at this point, as the hon. member says, it could cost
Canadian taxpayers $500 million without a nail being driven or
an inch of asphalt being laid.
The point is the Government of Canada has made known its
position. We are prepared to pay up to $30 million for
reasonable out of pocket expenses to compensate those people
who were involved in the process, many of them third party not
directly involved in the process that led to the granting of that
final contract.
The difficulty with the Reform Party is as usual it wants its
cake and wants to eat it too. That is not the way it works in the
real world.
* * *
Hon. Audrey McLaughlin (Yukon, NDP): Mr. Speaker, my
question is for the Prime Minister.
Today the book by Ben Wicks, ``Born to Read'', was launched
on Parliament Hill, reminding us all of how important and how
serious the problem of illiteracy is Canada. However, it is not
evident by the actions of the government that it takes this
seriously.
There are some seven million people in Canada who have
difficulty or extreme difficulty reading. Because national
literacy groups are still on year to year funding and not core
funding it is very difficulty to plan.
Will the Prime Minister comment on this important day and
commit to allowing literacy groups to have long term funding,
not on a year to year basis to solve this problem?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, education is more a problem for provincial
governments but we have national programs to help.
There was a specific problem coming from the federal
government for that program which is financed on a yearly
basis. Everybody knows the government is facing some difficult
budgetary problems. I will look into the matter and see what can
be done.
Hon. Audrey McLaughlin (Yukon, NDP): Mr. Speaker, I am
sure the Prime Minister will agree that having seven million
citizens who have difficulty or extreme difficulty in the every
day tasks of literacy is hindering this country's economic and
social development.
Will he commit to long term funding and a serious
commitment by the government to attacking the issue of
illiteracy?
(1500 )
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, part of the work we have given to the Minister of
Human Resources Development in the reform of unemployment
insurance and social programs is for him to review this in the
next months to come. There will be an element to make sure that
all Canadian citizens can benefit from our policy so that training
and gaining abilities in learning is key to finding jobs in our
society.
It will be part of the discussions we will have in the House
when the reform of the social programs and transfer programs to
the provinces will be discussed. The hon. leader of the NDP will
have a chance to comment at that time.
* * *
Mr. Harold Culbert (Carleton-Charlotte, Lib.): Mr.
Speaker, my question is for the Parliamentary Secretary to the
Minister of Human Resources Development.
As of this week, many college and university students will be
returning to their homes throughout Carleton-Charlotte to
begin their search for needed summer employment so they may
obtain the necessary funds to return to school this fall.
What actions are being taken by the government to address
this important employment opportunity for the youth of our
communities?
Mr. Maurizio Bevilacqua (Parliamentary Secretary to
Minister of Human Resources Development, Lib.): Mr.
Speaker, in keeping with the red book commitment, young
people are a priority for the government. We have taken
measures to give them opportunities to learn some very valuable
skills.
I am happy to announce, as I did three weeks ago in the city of
Vaughan, that the overall budget for youth employment and
services has been increased by $43 million even during this
fiscal restraining time. This speaks volumes for the type of
commitment that we as a government have toward our young
people.
11684
The Speaker: Colleagues, I wish to draw to your attention the
presence in the gallery of the Hon. Stephen Kakfwi, Minister of
Justice and Minister of Intergovernmental and Aboriginal
Affairs from the Legislative Assembly of the Northwest
Territories.
Some hon. members: Hear, hear.
[Translation]
The Speaker: I wish as well to draw the attention of members
to the presence in our gallery of His Excellency Ricardo Alarcon
de Quesada, Speaker of the National Assembly of the Socialist
Republic of Cuba.
Some hon. members: Hear, hear.
[English]
This brings question period to its conclusion.
_____________________________________________
11684
ROUTINE PROCEEDINGS
[
English]
The Speaker: I have the honour to lay upon the table the
report of the Chief Electoral Officer of Canada entitled ``The
February 1995 Byelections: Another Step Forward''.
[Translation]
Accordingly, pursuant to Standing Order 35, this document is
deemed permanently referred to the Standing Committee on
Procedure and House Affairs.
* * *
[
English]
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons, Lib.): Mr.
Speaker, I am pleased to table, in both official languages, a
number of order in council appointments that were made by the
government.
Pursuant to the provisions of Standing Order 110(1), these are
deemed referred to the appropriate standing committees, a list
of which is attached.
* * *
[
Translation]
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons, Lib.): Mr.
Speaker, while I have the floor and pursuant to Standing Order
78, I have the honour to table, in both official languages, the
government's response to 36 petitions.
(1505)
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons, Lib.): Mr.
Speaker, I have the honour to present the 73rd report of the
Standing Committee on Procedure and House Affairs regarding
the list of committee members.
With the consent of the House, I intend to propose adoption of
the 73rd report later today.
[English]
Mr. Speaker, I move that the 73rd report of the Standing
Committee on Procedure and House Affairs, presented to the
House earlier this day, be concurred in.
(Motion agreed to.)
* * *
Mr. Jim Jordan (Leeds-Grenville, Lib.): Mr. Speaker, I
wish to seek the consent of the House to withdraw Motion No.
M-5. It is my motion in Private Members' Business and it deals
with the issue of excise taxes on ethanol.
In December the government introduced legislation which
will handle that situation to my satisfaction. The new ethanol
program that deals with the issue was put forward then and
further debate is not required now.
(Order discharged and motion withdrawn.)
* * *
Mrs. Shirley Maheu (Saint-Laurent-Cartierville, Lib.):
Mr. Speaker, I have the pleasure of presenting a petition from
several residents in Quebec and more particularly the group
Affordable Textbooks Now.
As the result of the increasing cost of textbooks which are
needed for student studies, many people are forced to effectively
break the law because they are photocopying in part or in whole
many of the textbooks for which they are not in a position to pay.
Therefore they request that Parliament put an end to the GST
on textbooks and take into account the high price of textbooks
when allotting money for educational funding.
[Translation]
Mr. Michel Daviault (Ahuntsic, BQ): Mr. Speaker, I have
the honour of submitting a petition signed by over 1,000
petitioners concerning the Armenian genocide. The petitioners
note that our country, recognized as an active defender of
democratic principles and human rights, has yet to officially
11685
condemn the atrocities and commemorate the first genocide of
the 20th century.
Accordingly, the petitioners ask Parliament to change its
policy of indifference to the Armenian genocide, to take the
initiative and to actively promote international efforts in order
to persuade Turkey to acknowledge its crime against humanity.
[English]
Mr. Jack Frazer (Saanich-Gulf Islands, Ref.): Mr.
Speaker, pursuant to Standing Order 36, it is my duty and honour
to rise in the House to present a petition duly certified by the
clerk of petitions on behalf of 43 constituents from the riding of
Saanich-Gulf Islands and more specifically from the island of
Saltspring.
The petitioners call on Parliament to amend the Canadian
Human Rights Act to protect individuals from discrimination
based on sexual orientation.
Mr. Dick Harris (Prince George-Bulkley Valley, Ref.):
Mr. Speaker, pursuant to Standing Order 36, I am pleased to
present four petitions to the House today from my riding of
Prince George-Bulkley Valley containing several hundred
names and dealing with the proposals for gun control.
One petition is from Mr. Dan Varma of Prince George, B.C.;
two from Mr. Jim Eisert of Fraser Lake, B.C.; and, one from the
Prince George branch of the Responsible Firearms Coalition.
All these petitioners request that Parliament support laws
which will severely punish all violent criminals who use
weapons in the commission of a crime; that Parliament will
support new Criminal Code firearms control provisions which
recognize and protect the right of law-abiding citizens to own
and use recreational firearms; and finally, to support legislation
which will repeal and modify existing gun control laws which
have not improved public safety or have proven not to be cost
effective or have proven to be overly complex so as to be
ineffective and/or unenforceable.
(1510)
[Translation]
Mr. Gilbert Fillion (Chicoutimi, BQ): Mr. Speaker,
pursuant to Standing Order 36, I have the pleasure of submitting
to this House a petition from the people of the county of
Chicoutimi, who wish to draw the attention of Parliament to the
following: considering that seniors are naturally the least
familiar with voice mail technology and considering that seniors
are entitled to appropriate service with regard to their requests
concerning income security, the petitioners ask the government
to abandon its plan to install voice mail for senior citizens.
[English]
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr.
Speaker, pursuant to Standing Order 36, I have the pleasure to
present the following petitions on behalf of constituents of my
riding of Souris-Moose Mountain and other parts of
Saskatchewan.
In the first petition, 238 people support the retention of the
Canadian Wheat Board.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr.
Speaker, the second petition contains 300 signatures of people
who oppose Bill C-68 and ask that Parliament refrain from
implementing any further firearms legislation.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr.
Speaker, the third petition contains 315 signatures of people
who oppose physician assisted suicide.
Mr. Paul DeVillers (Simcoe North, Lib.): Mr. Speaker,
pursuant to Standing Order 36, I have the pleasure of presenting
petitions signed by 201 residents primarily from my riding of
Simcoe North.
The petitioners request that Parliament ban the use of BST in
Canada and not accept milk products from other countries where
BST is used to treat cattle.
Mr. Wayne Easter (Malpeque, Lib.): Mr. Speaker, under
Standing Order 36, I am pleased to present petitions on behalf of
183 people in Prince Edward Island.
The petitioners humbly request and call on Parliament to
desist legalizing the use of BST or rbGH in Canada. They further
request that legislation be passed requiring it to be mandatory
for all imports produced from BST treated cows be so identified.
I so support.
* * *
Mr. Peter Milliken (Parliamentary Secretary to Leader of
the Government in the House of Commons, Lib.): Mr.
Speaker, the following questions will be answered today: Nos.
133, 141 and 159.
[Text]
Question No. 133-Mr. Simmons:
With respect to the search and rescue program, what action will the government take
in response to the Auditor General's 1994 findings about the ``lack of action on many
11686
previous recommendations'', specifically that (a) ``significant elements of a
national search and rescue program have not been developed'', (b) ``time-based search
and rescue service standards-are lacking'', (c) ``expanded use of volunteer and other
resources should be pursued'' and (d) ``greater use of other federal resources for search
and rescue is possible''?
Mr. Peter Milliken (Parliamentary Secretary to the
Leader of the Government in the House of Commons, Lib.): I
am informed by the Departments of National Defence and
Transport as follows:
(a) Relating to the federal government's area of
responsibility, the system for directing the operation of SAR
activities and resources is well established. There has also been
good progress in developing principles and plans for managing
the federal portion of the national SAR program. With reference
to provincial and territorial governmental involvement in the
national SAR program, progress has naturally been slower as the
provinces and territories assess the value of their involvement in
the co-operative program such as SAR. The federal government
will continue to display leadership in this area.
(b) Since the original recommendation of the Auditor General
(AG) in 1992, the Department of National Defence (DND) and
Transport Canada have consistently maintained that they
disagree with the AG recommendation for time-based SAR
service standards. Both departments have developed suitable
service standards and they do not judge that time-based service
standards provide an accurate or effective indicator of program
performance.
The Canadian Coast Guard responds to 6,000 to 8,000 search
and rescue incidents, of all types, per year. The existing system
includes coast guard, other government vessels, the Canadian
Marine Rescue Auxiliary, and vessels of opportunity.
The present levels of service indicate that, on average, 90 per
cent of lives at risk in marine distress incidents are saved by all
responders, private and government. Thus, the Canadian search
and rescue system compares favourably with systems of other
countries.
The Canadian Coast Guard has published many standards for
search and rescue. These standards pertain to operations,
co-ordination and planning and performance. The standards
apply to the rescue co-ordination centres and sub-centres,
primary and secondary vessels, the Canadian Marine Rescue
Auxiliary, and other components of the coast guard search and
rescue system.
The Canadian Coast Guard has established levels of service
(LOS) for search and rescue which focus on quality and extent of
service and the effectiveness of response, based on the actual
probability for effecting a rescue. On the basis of these LOS
criteria, it should be noted that the comparable results between
the whole Canadian marine search and rescue system and that of
the United States for the period 1986 to 1990 are 90.5 per cent
versus 80.3 per cent.
The departments involved in search and rescue are currently
enhancing and integrating their information systems in order to
improve performance reporting and analysis. Until recently they
lacked an automated information system to provide timely data
on the performance of federal search and rescue resources. In
addition, further sophistication of analysis as to severity of the
incident and the type of assistance provided continues to be
required for decisions on levels of service, acquisition and
management of resources.
A new computer information system called SISAR is
currently in use by the Canadian Coast Guard and the
Department of National Defence. This new system, which
captures accurate and consistent data on search and rescue
incidents, establishes an information base which will provide
essential information for consideration in the decision-making
process concerning the search and rescue program.
(c) In 1978, the Canadian Coast Guard established the
Canadian Marine Rescue Auxiliary (CMRA), an all volunteer
force. It started with four members in Nova Scotia; by last year
it has expanded to five separate associations in all areas of
Canada with some 3,300 members and 1,200 vessels. Last year,
these volunteers responded to some 1,800 search and rescue
incidents-about 25 per cent of the total. The Canadian Coast
Guard is continuing to support and expand the capability of this
effective group of volunteers.
In 1992, the Canadian Coast Guard's Laurentian regional
office was given a mandate to develop an approach to promote
the co-operation of local resources to provide search and rescue
services on inland waters, advise local resources and ensure
technology transfer for search and rescue training, equipment
and expertise. The Laurentian regional office set up a successful
pilot project in the Lac St. Jean, Quebec area which is being used
as a model for other coast guard offices across the country.
The federal government of Canada places a high value on the
contribution of volunteer SAR organizations such as the Civil
Air Search and Rescue Association (CASARA) and the
Canadian Marine Rescue Auxiliary (CMRA). In the face of
increasing fiscal restraint, the participation of volunteers in the
national SAR program becomes increasingly important. To
illustrate, the government provides $800,000 per year and the
services of 12 Canadian forces training and support personnel to
assist in training CASARA volunteers. Specialized SAR
equipment is also provided for installation on CASARA aircraft.
The federal government search and rescue officials will
continue to pursue every opportunity to use volunteers in search
and rescue activities.
(d) The interdepartmental committee on search and rescue
(ICSAR) was formed to co-ordinate federal involvement in
search and rescue activities. Currently, the federal government
11687
actively pursues a policy of interdepartmental co-operation to
enable utilization of federal resources for search and rescue and
to provide a cost effective SAR service.
The search and rescue system maintains an inventory of all
available federal resources in each search and rescue region. By
law, all vessels have to respond to distress situations. The
Canadian Coast Guard has primary search and rescue vessels
and by policy, all other coast guard vessels are now assigned
multi-tasking duties to cover primary search and rescue and
other program duties in certain search and rescue areas. Further,
some federal resources such as the Department of Fisheries and
Oceans, the Department of National Defence and the Royal
Canadian Mounted Police vessels carry out search and rescue
operations as tasked by rescue co-ordination centres.
Question No. 141-Mr. Mayfield:
With respect to the consolidation of office space planned within the
national capital region by the Department of Citizenship and Immigration, (a)
what is the cost per year for each of the 11 office leases currently held by the
department, (b) what are the expiry dates of each of these leases, and (c) what
are the expected savings per year for this consolidation plan?
Hon. David Dingwall (Minister of Public Works and
Government Services and Minister for the Atlantic Canada
Opportunities Agency, Lib.): In so far as Public Works and
Government Services Canada is concerned:
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(c) It is estimated that this relocation will result in savings of
$1.4 million to 1.7 million per year for 10 years, based on an
estimated net reduction of some 7,050 square metres at a market
range of between $200-$250 per square metre.
The tender for this requirement closed on January 26, 1995.
Public Works and Government Services' analysis concluded
that none of the six bids submitted met the technical
requirements set out in the lease tender call. The financial
envelopes were returned to the bidders unopended.
On March 3, 1995, I announced that the tender for this
relocation would undergo a third party review before the project
proceeds further.
Question No. 159-Mr. Caccia:
In airports across Canada, is Transport Canada arranging for the collection
of de-icing fluids in accordance with CEPA guidelines, and if so, (a) at which
airports under Transport Canada management or jurisdiction is this collection
taking place, (b) how is this collection taking place and, if not, when and
where will such collection be installed?
Hon. Douglas Young (Minister of Transport, Lib.): (a) and
(b) The responsibility for the collection of de-icing fluids at
Transport Canada airports remains with the air carriers or
de-icing operators. The means of collection and disposal are
outlined in the site specific glycol mitigation plan submitted to
Transport Canada.
Glycol mitigation plans have been submitted at the following
Transport Canada airports: Halifax International, Quebec City,
11688
MacDonald Cartier International (Ottawa), Lester B. Pearson
International (Toronto), Thunder Bay, Regina and Winnipeg
International. The four local airport authorities also have plans
in place, i.e. Vancouver, Calgary, Edmonton and Aéroports de
Montréal, Dorval/Mirabel.
The mitigation plans are designed to ensure that spent glycol
fluids are contained, collected and disposed of in an
environmentally acceptable manner.
The effectiveness of the plans are measured by the amounts
collected and from stormwater analysed against the CEPA
guidelines.
It should be noted that copies of the glycol mitigation plans
were submitted to the Standing Committee on Environment and
Sustainable Development.
[English]
Mr. Milliken: I ask, Mr. Speaker, that the remaining
questions be allowed to stand.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
_____________________________________________
11688
GOVERNMENT ORDERS
[
Translation]
The House resumed consideration of the motion. That Bill
C-75, an act to amend the Farm Improvement and Marketing
Co-operatives Loans Act, be read the second time and referred
to a committee.
Mr. Jean-Guy Chrétien (Frontenac, BQ): Mr. Speaker, I
would like to pick things up exactly where we left off
approximately 67 minutes ago. We were replying to the
Parliamentary Secretary to the Minister of Agriculture on Bill
C-75 which will raise from 1.5 billion to 3 billion dollars the
maximum amount of government guaranteed farm loans.
As I had to split my speech in two, I should perhaps remind
members that the bill before us seeks to amend the Farm
Improvement and Marketing Cooperatives Loans Act. I will
now continue reading my text exactly where I left off at two
o'clock, about 67 minutes ago.
Let us say, for example, that the Quebec Société du
financement agricole keeps a very close watch on the rate of
increase of farmers' indebtedness and that, in so doing, it
modifies its standards and criteria. It would never have the
necessary leeway to implement its decisions because a federal
agency would once again meddle in its affairs and muddle up the
initial goal of the Quebec government. The federal
government's eligibility criteria do not necessarily reflect
provincial priorities.
(1515)
Federal agencies compete with provincial agencies, which
may have stricter criteria, and I must say that the provinces are
in a better position to know the real needs of their citizens. In
any case, they are certainly in a better position than the federal
government, which has to enact general policies that must be
realistic and applicable from coast to coast.
The thing that we must remember is that, once again, instead
of eliminating overlapping and giving the provinces their own
tools, the Liberal government has decided to keep everything
under its control. By maintaining this overlapping, the federal
government gives itself the opportunity to intervene in the
management of our agricultural sector in Quebec.
It should also be emphasized that it is very strange that this act
is administered by the department instead of the Farm Credit
Corporation. Even if the programs are different, the Farm Credit
Corporation already arranges loan guarantees. That is a striking
example of administrative duplication. This is not duplication
between government levels but in fact duplication within the
same government.
We, in the Bloc Quebecois, wish that the government would
give to the provinces the financial resources that belong to them.
As the Prime Minister said earlier in answer to a question from
the Leader of the Opposition, Quebec is not begging but merely
asking for what it is entitled to.
Provinces will thus be able to take over the administration of
programs like the one Bill C-75 deals with. It must be clearly
understood that we are not against the bill as such but we firmly
oppose the overlap and duplication it perpetuates, whether in the
same government, that is the federal government, or between the
federal government and provinces. We believe the bill is
relevant but we regret that it maintains duplication.
I would now like to submit some statistics found by our
researchers about FIMCLA or Bill C-75. First I wish to remind
the House that since February 1988 when the above amendments
came into force, over 65 000 loans totalling some $1.5 billion
have been granted under the act.
I should also remind you that the province which benefits the
most from the act is Saskatchewan, followed in second place by
Alberta and third by Quebec. I believe Ontario comes in fourth
place in terms of utilisation of the act but I must remind you the
rural Ontario enjoys a high standard in terms of agriculture and
investment needs. To this day, some 10 loans have been granted
under the act for co-operative projets with a total added value of
$14.2 billion.
In 1994-95 for example, 17,000 loans totalling some $475
million have been granted under the act. Again in 1994-1995,
the average loan is $27,000 and the five-year average is
$22,000.
(1520)
In the last 25 years, net losses incurred under the act have
accounted for 1 per cent of all guaranteed loans each and every
year.
11689
I would now like to talk to you about interest rates. I think that
interest rates are reasonable and favourable to farmers. The
maximum interest rate that lenders can set is the prime rate plus
1 per cent in the case of variable rates. Or, if you prefer, the
variable rate is equal to the prime rate plus 1 per cent, so it
changes like the tide. If interest rates go up, the interest rate paid
by farmers on loans guaranteed under this act will go up as well.
Conversely, if interest rates go down, the interest rate paid by
farmers will also go down.
However, if the farmer wants a fixed rate for five years, the
rate will be the prime rate at the time he negotiates his loan plus
2.25 per cent. But it must not go beyond a fixed five year period.
According to the statistics I am quoting to you, in 1991, some
683 rural lenders such as caisses populaires and credit unions
were accredited as lenders under this act.
As you know, Mr. Speaker, caisses populaires were treated
inequitably in the past, because the caisse populaire network
plays an extremely important role in Quebec. Often, it was less
profitable for the large banks to do business in rural areas, so
they withdrew to the major centres. They left rural communities
to the caisses populaires, making it difficult for our farmers to
borrow money since the caisses populaires were not even
accredited.
How could the central government, with its so-called respect
for institutions, have the nerve not to accredit the caisses
populaires? Only large banks had this privilege, because, as we
know full well, the caisses populaires never make financial
contributions to political parties, be it the Bloc Quebecois or any
other political party.
You see, since they were not major contributors to election
funds, they were simply relegated to that kind of loan. It is a
disgrace. Fortunately, staunch nationalists such as the Parti
Quebecois members, whose courage I must salute, pressed and
reasoned the the federal government into recognizing credit
unions as lenders for the purpose of this loan guarantee.
While accounting for 25 per cent of the total Canadian
population, Quebec is only the third largest user of loans
guaranteed by the federal government at seemingly interesting
interest rates under this act. Why do Quebec farmers not use this
window? Because it is not well known at all. So, with your
permission, I will try to describe it as briefly and simply as
possible.
First of all, I must tell you that this act does not apply to
anyone who wants to start a farm business. If you want to buy a
farm with a view to eventually becoming an independent farmer,
this act is not for you; you have to go either to the Farm Credit
Corporation, which is a federal institution, or to the Société du
financement agricole, which is a Quebec institution.
(1525)
The bill before us this afternoon is for farmers who wish to
make improvements, expand their facilities, buy out a
neighbour, those who want to build extensions, for example an
addition to a hog house, build a road across their farm to get to
the wood at the other end of the property, install an electric
generator in a hog house or refinance and consolidate all their
debts in a single loan. That is what this kind of loan is for. It
could also be used to buy cattle, install a new grain silo or buy
the neighbour's silo to move it to your land. As you know, the
cost of building a manure pit or buying tractors, rotary mowers
or combine-harvesters is always on the rise.
Of course, the government is not guaranteeing loans of less
than $2,000. As you know, in 1995, we cannot afford to create
paperwork costing more than the benefit provided. There is also
an upper limit. For farmers, the maximum is $250,000, while in
the case of agricultural co-operatives, it is $3 million.
Some purchases are not eligible, such as short term goods.
Under Bill C-75, piglets weighing 35 or 45 pounds would not be
eligible because such a purchase is for a short term of about five
or six months. Consequently, it would not be eligible. The same
is true in the case of repairs to the family home on the farm. Such
an expense would not be eligible. Nor would the purchase of
quotas. A dairy producer interested in buying a quota to generate
a more substantial income would not qualify.
So, under that bill, a farmer can borrow up to $250,000 and an
agricultural co-operative up to $3 million. The loan guarantee
must cover the maximum of 80 per cent of the loan. We cannot
guarantee more than 80 per cent of the assets bought. In the case
of a farm expansion, the maximum period provided to repay the
loan is 15 years, while it is 10 years for any other product or
good. It goes without saying that, if the product bought will only
last four years, the maximum period provided to repay the loan
will not be 10 years but four.
Let us now look at payments. Payments could be made on a
monthly basis, but at least one payment would have to be made
each year. If someone says: ``I only want to pay every two
years'', that would not be possible under this bill, since a
minimal payment is required every year.
I have already addressed the issue of interest rates, so I will
recap briefly. If you talk about the variable interest rate, the
floating rate, that is the prime rate plus 1 per cent. If you choose
the fixed rate, that is a lot more costly. A fixed rate is only good
for 5 years and is equal to the prime rate plus 2.25 per cent.
Finally, I would like to take a minute or so to talk about the
registration fee and the administration charge.
11690
(1530)
Farmers who ask for a loan under the Farm Improvement and
Marketing Cooperatives Loans Act must make a payment of
one-half of 1 per cent, or 0.5 per cent of the total amount of the
loan. This money is paid to the Receiver General for Canada so
that the loan guarantee can be examined. Over and above this 0.5
per cent, the lender can also add $250 or one-quarter of 1 per
cent of the amount, whichever is less, as long as it does not
exceed $250,000.
As was said earlier, this also applies to co-operative
agricultural societies, and there are quite a few of these in
Quebec. The Co-operative Society of Disraëli, a town located
not far from my area, contracted a loan a few years back when it
built silos in order to produce feed. This loan was guaranteed by
the federal government.
A co-operative agriculture society can therefore get up to
almost $3 million at the same interest rate as the one mentioned
earlier for farmers.
The Bloc Quebecois will support Bill C-75. But again, I want
to make it clear that we support this legislation so that our
farmers can receive the financial resources they need to expand
and so that they can get from the federal government the
guarantees to which they are entitled, since they pay taxes just
like any other worker in Canada and particularly in Quebec.
But, as I said a few moments ago, we do have some objections
concerning duplication and overlap.
During the four days of recess in the week after Easter, I
visited several farmers who are friends and colleagues of mine. I
told them that I was going to speak on this bill today. A very big
majority of farmers, although not all of them, said to me that
they were not familiar with this act. This is certainly why
Quebec is only the third most important user of the services
provided under this act among the ten Canadian provinces, even
if Quebec farmers alone account for more than 17 percent of
farm production in this country.
Saskatchewan, a province with a small population base, ranks
first because the program was well advertised in that province.
Mr. Fernand Fillion, a hog producer in Lyster, told me that,
before building his new hog house, an investment of well over
$1 million, he examined the services provided by the Société de
crédit agricole du Québec, the Société de financement agricole
in Quebec and under this act. He realized that the loan provided
by the Société de financement agricole du Québec was the most
profitable option in his case.
Farmers have three options: they can borrow money through
the Société de financement agricole, the Société de crédit
agricole du Québec, or under the Farm Improvement and
Marketing Cooperatives Loans Act. Why not save money
through the single window approach? Farmers would not have to
knock at three different doors, and travel to as many as three
cities to meet with civil servants who cost the government a lot
of money. It is always the same taxpayer who pays for this kind
of inefficiency and duplication.
(1535)
When we, members of the Bloc Quebecois, visit people in our
rural areas, our concessions, our municipalities, our small
towns, and tell them about all this duplication, they understand
easily and quickly why we have a $40 to $45 billion deficit every
year.
We could easily save millions. I have a perfect case of
duplication within the government. Just last week, a farmer was
telling me: ``We would like to deal exclusively with the Quebec
Minister of Agriculture because he is the one that we know. We
do not even know who the federal Minister of Agriculture is and,
when he comes to see us, he has great difficulty talking to us in
our own language''. It is not a bad thing, of course, but it must be
understood that Quebecers are a lot closer to their provincial
government than to the federal government.
The Minister of Agriculture is constantly telling us that his
ultimate goal is to help farmers. If he really wants to help
farmers, why not make things easier for them by having a single
window and using the money that the government will save this
way to lower interest rates? It would not cost a penny more and
farmers would be a lot happier.
I take this opportunity to invite the Minister of Agriculture to
take a week off and to come and visit with farmers in rural
Quebec. Among the 17 or 18 Liberal members who represent
Quebec in this government, there are certainly a few who come
from rural ridings. I am sure they are not all city members from
the West Island. There must be a few among them who have seen
a cow up close and who have been in a hog house. Let them come
and visit. There is the Prime Minister, whom I know very well
and who represents the beautiful riding of Saint-Maurice. There
are fine farms in his riding. I invite, for example, the Minister of
Agriculture to visit the riding of Saint-Maurice and to ask
farmers what they want. In Saint-Maurice, which is different
from the riding of Frontenac, there must be some federalists,
since they elected the Prime Minister. So, that is where the
minister should go.
I am telling you, Mr. Speaker, farmers know that they are
being had by this government. Monday morning, I met a farmer
who told me-because he had watched the debates of the
opposition day concerning cuts in agriculture, being himself an
industrial milk producer-that he thought he would lose
approximately $4,000. And it is the last thousand dollars that is
profitable, not the first.
You know, Mr. Speaker, in a cow barn, it is not the first cow
that is milked in the morning that is profitable, but always the
last. Indeed, the last one is all profit. With this 30 per cent cut in
the industrial milk subsidy, the government is taking away from
the farmer this last cow which brought him his $4,000 at the end
of the fiscal year.
11691
(1540)
He did not need to convince me, of course, but the dairy
producer's concern was that in August the price of dairy
products would be increased. By increasing the price of dairy
products, and this is a proven fact, we will diminish
consumption, which, in turn, will entail a reduction of the quota.
So, I get the picture, Mr. Speaker. I am explaining these things to
you and I am sure you understood them before I started speaking
about them. And you may share my point of view that we should
try to work not for us, but for our farmers, once and for all.
[English]
Mr. Allan Kerpan (Moose Jaw-Lake Centre, Ref.): Mr.
Speaker, as I listened to the debate I asked myself why we are
here, why we have heard, as we have so often in the past, of
amendments to particular bills or new legislation being
introduced.
I would criticize the government for dodging what I think is
the big issue. If I talk about the farm improvement loans act, I
will not be specifically critical. By and large it has been a good
program, as has been mentioned today. Especially in my
province of Saskatchewan it has been very well received and
very well used. The parliamentary secretary to the minister is
absolutely correct. The default rate is not very high when one
considers the amount of money lent through that program.
As I said before, perhaps the big picture or the issue is being
dodged or avoided to some extent. I refer to what my colleague
from the Bloc had to say. For obvious reasons the member from
the Bloc has different plans, different hopes and aspirations for
his province than I do for mine. I find myself agreeing very
much with what he said today when he talked about the
duplication and the overlap of these types of programs.
In Saskatchewan if farmers wanted to borrow money with
some sort of government assistance or help they could look at
this current program, the farm improvement loans act, small
business loans, the Farm Credit Corporation or, only in
Saskatchewan, the Agriculture Credit Corporation of
Saskatchewan. A farmer has his or her option of four different
areas or wickets, as my friend from the Bloc said, from which to
borrow this money. I ask myself why. I see no reason for four
different bureaucracies to get the same end result.
If I look back on the motion I put forward which is before the
House now, one of the basic pillars my motion is built on is to
reduce duplication and overlap and to bring the services that
cannot be privatized into the lowest or the most local department
for delivery of programs or services.
I do not think anybody would deny farmers need access to
capital for the financing of their endeavours just as any other
business does. Because of the unique characteristics of
agriculture with its exposure to unique risks, the private
financial services industry has at times been reluctant to provide
the services farmers and agri-food businesses need. The unique
risks the farming industry faces are related to being very much
at the mercy of mother nature and the fact that for the most part
we produce perishable goods that must be moved quickly to
market and sold.
In our integrated global trading environment where food and
non-food products are shipped across our borders, our oceans,
our skies and our land, a natural disaster such as a drought, a
flood or a hailstorm in one part of the world could create
shortages that farmers somewhere else must fill.
The international agricultural marketplace can thus be very
volatile and is affected from year to year by price hikes and price
drops, by supply gluts and supply shortages. These unique facts
of life that farmers face create unique financial needs that some
financial services provider must fill.
(1545)
Our discussion about farm financing should centre around
asking the simple question: How can our society and our world
best serve the financial needs of the agriculture industry and
thus ensure that we have a safe, stable, affordable, and abundant
food supply?
Generally, farmers and agri-businesses have proven over the
years to be good borrowers to meet the terms and conditions of
their loans on time and in full. As the parliamentary secretary
has mentioned, that is the case in this program.
There have been years in which an onslaught of unfortunate
disasters has occurred that has stretched farmers' income and
expenditure balance sheets to the very limit. At times like these,
provincial and federal governments have stepped in with
emergency aid because the public's interest for a stable food
supply has been put at risk.
I can tell you, Mr. Speaker, after spending my entire life in the
farming industry, that no farmer wants government handouts.
No farmer wants government to be his full time partner in
business. We have said over and over again in this House that
farmers, just like other business entrepreneurs, want
governments off their backs and out of their pockets. We want
lower taxes and input costs. We want a streamlined and efficient
regulatory process. We want governments to negotiate good
trade deals and to open up access to marketplaces so that we can
develop to our full potential as world competitors.
What concerns me about legislation such as Bill C-75 is that
government is stepping in and taking a role that the private
financial services industry could and perhaps should provide.
As long as this government or any government continues to
11692
participate in this kind of financial activity, I do not believe that
the private sector will ever become motivated enough or
competitive enough to provide the financial services the
agriculture sector needs. Why should it?
It also strikes me as ironic that the private sector would
actually have the level of confidence in the federal government
as its guarantor that it appears to have. I know the federal
government will certainly have about $120 billion worth of tax
revenue this year and that the $3 billion in loan guarantees that
this act provides for is probably sound, even if it were all to be
defaulted upon, which of course it will not be. This type of
financial arrangement does raise the ironic question of how an
organization that is $550 billion in debt and that will pay almost
$50 billion this year in interest payments can be counted upon as
a guarantor of anything.
It is the government that is in debt trouble and in need of a bail
out, not the the farmers or the lenders. We might have the cart
before the horse in this case.
Therefore I would assert that it is time to ask the question
about what the proper approach to financial services for the
agriculture sector is. Should government be increasing loan
guarantee programs at this time? How can it really be a
guarantor of premium quality when its own finances are in such
bad shape? Should not the government rather be encouraging the
private financial services industry to serve the agriculture
industry?
I believe there would be financial companies that would move
into this service market, competition would be introduced, and
farmers would therefore get good service. The government
should clearly indicate to the private sector what it sees as its
limits of involvement and then develop policy in that direction.
There is no free lunch. As individuals, farmers, business
people or whoever we are, we will all pay for the goods or
services that we need. If we get what we need from the private
sector we will pay in dollars. If we get it from the public sector
we will pay in tax dollars. Mr. Speaker, it is a crying shame that
my children and yours are going to have to pay back the $550
billion debt that we now owe for services that we enjoyed. Debt
is nothing other than deferred taxes and the intergenerational
transfer of financial obligation.
I ask you, Mr. Speaker, before this problem gets worse, might
this Parliament not be the one that recognizes the importance of
a clear and better division of responsibilities between the
private and the public sectors, between paying by taxes or by
dollars. Surely, we should not simply approve this bill or any
other like it before asking how much it will cost, how are we
going to pay, and is there a better way to do this. If generational
stewardship and self-responsibility mean anything, surely we
must ask these questions and seek the best answers.
(1550)
Government must no longer be allowed to continue to grind
along day after day, year after year, program after program as a
self-contained and self-propagating industry, completely
insulated from and oblivious to the long-term consequences of
its actions. We either repair and fix our economic house now or
our children are going to have to fix it-or it is going to have to
be fixed for us by outside sources.
At committee stage of Bill C-75, my Reform colleagues and I
want to talk about these matters. We believe that there may be
some amendments to this bill that would be in order. We will
listen to what other members have to say, what the officials have
to say. But rest assured that we will press forward and onward as
Reformers in the last decade of this century and this millennium
to ensure that our children are not saddled with the catastrophic
results of irresponsible actions that we the parents take.
In conclusion, I want to say that the criticism of this
amendment to Bill C-75 is not one that would see this act
replaced. It is an act that could simply be consolidated, as I
mentioned before, with the Small Businesses Loans Act,
perhaps put under the auspices of the Farm Credit Corporation,
if that is the most efficient and most effective way to do it, and
get rid of the huge bureaucracies, as my colleague from the Bloc
mentioned.
There are three federal bureaucracies in Saskatchewan. I
firmly believe that at least one and most likely two of those
could be eliminated. All those types of lending guarantees that
the federal government produces for the farm industry should be
carefully examined. The big picture of this issue must be looked
at, not simply a band-aid measure to make an amendment.
The parliamentary secretary is correct in saying that if we do
not make this amendment the program will have to be delayed
for two years. However, we can do better than that simply by
opening up what we believe and perceive to be a strangulation of
the system by effectively not being prepared to look at
consolidation and removal of duplication.
As I mentioned, my colleagues and I will be preparing
amendments for committee stage of this bill. We would ask that
the government and the official opposition would support and
work with us on any amendments that would make our system
more cost-efficient and effective.
Mr. Glen McKinnon (Brandon-Souris, Lib.): Mr.
Speaker, let me start by saying that the level of interest in the
agricultural community is very high with regard to this
particular aspect of financing.
The access to capital is probably paramount to achieving
long-term success in agriculture, as it may apply to farm
improvements, processing, distribution and marketing of farm
products. The program has proven very popular with farmers.
The five-year, $1.5 billion cap has almost been reached.
Consequently, we have two choices: increase the aggregate load
limit
11693
or suspend the program. I would like to examine those two
options in greater detail today.
The first option is to increase the aggregate amount of loans
that can be made under the FIMCLA program from $1.5 billion
to $3 billion. In considering this option, one might ask how risky
this program is and how many loans go into default. The record
is really very good. The net claims rate-that is, the gross minus
recoveries-is about 1 per cent, and has remained at that level
fairly consistently over the last 25 years. There have been some
blips. There have been occasions when it has risen as high as 1.5
per cent. On that occasion in the 1980s, it was caused by high
interest rates, low farm income, and land devaluation.
(1555)
Since 1992 there has been a significant reduction in claims
and the program now has a positive cash flow. This is expected
to continue at least through 1997. There will be some extra costs
associated with the higher aggregate limit, but measures will be
taken to offset this. For example, an increase of only 0.25 per
cent in the registration fee would be sufficient to offset these
extra costs and maintain the current level of liability for at least
another five years. For the average loan of $27,000, this would
amount to an increase in costs of $67.
The number of loans and any losses will continue to be
monitored on an ongoing basis if the net claim rate is higher than
anticipated. Program costs could be controlled. For example,
the guaranteed level could be lowered from 95 per cent and loan
eligibility could be limited or registration fees further
increased. In other words, the aggregate limit can be increased
at little or no cost to government, and should satisfy program
demands for another 10 years. It is a positive measure that is
supported by the agri-food sector and commercial lenders.
The second option is maintaining the status quo, keeping the
current aggregate limit to $1.5 billion and suspending the
program once the limit is reached.
In the first nine months of 1994-95, $422 million in loans
were guaranteed under the act, bringing the five-year aggregate
loan limit to $1.24 billion. If the current trend continues, the
present $1.5 billion cap could be reached as early as June, at
which time the program will have to be suspended. Since annual
loan registrations are expected to continue in the $500 million
range and the loans falling due are worth $80 million this year,
$115 million next year, and $196 million the year after, the
program would likely have to be suspended for about two more
years.
Since no new revenue would be generated from registering
fees during this period, the program's contingent liability will
be no different from the first option; that is, increasing the
aggregate limit to $3 billion, along with an increase in the
registration fee of 0.25 per cent. Should the status quo be
allowed to continue, long term program liabilities will likely be
kept at today's estimate of $16 billion.
FIMCLA is supported by farmers and their organizations,
especially the Canadian Federation of Agriculture, as well as the
lenders. I believe it would be a mistake to allow it to be
suspended. The program has been an inexpensive way for the
government to support the agri-food sector. The net loss rate
over 25 years has only been about 1 per cent. Increasing the
FIMCLA cap allows for this low cost support to continue.
In conclusion, I ask the House to support Bill C-75 by
increasing the aggregate principal amount of loans that can be
guaranteed. The program can continue to be offered to farmers
and farmer owned marketing cooperatives.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr.
Speaker, it gives me pleasure today to address this very
important bill, Bill C-75, an act to amend the Farm
Improvement Marketing Co-operatives Loan Act. This act
facilitates credit on farm improvements for processing and
distribution and marketing of farm products. I am sure we can
all agree the bill is very important to the agricultural sector.
(1600)
The program has been quite a success, giving many farms and
marketing co-operatives a hand in improving or starting new
operations. In the year 1994-95, FIMCLA, as the program is
called, was used to facilitate more than 17,000 loans totalling
some $475 million. The average loan size in 1994-95 was
$27,000 and the five-year average is $22,000.
It has been very advantageous to the agricultural group in
Souris-Moose Mountain. My riding is concerned about the
impact of recent GATT agreements and the World Trade
Organization on the day to day lives and operations of our
farmers.
It is very important to take a look at some of the restrictions
farmers in our area may face now that we have to make our grain
forwarding and other export practices acceptable to world
markets. To improve our opportunities we have to turn to value
added products.
I will tell the House about a group of people in my riding who
have embraced this idea. A group of six farm families in
Souris-Moose Mountain have formed a co-operative to begin a
joint venture with a Holland firm to establish a nucleus hog
breeding farm in Saskatchewan. It will be the first entry of
continental European hogs into Canada in 37 years.
With the assistance of the loan through FIMCLA the
co-operative farm has been formed. The joint venture is
positioned to address the new opportunities brought about by the
World Trade
11694
Organization. The venture pioneers the process of the
co-operative approach to improving the hog industry in
Saskatchewan.
Farm members will be provided with superior animals that
will increase the productive capacity of their existing operations
and improve the profitability of their hog operations. The
co-operative will be the first to introduce the Dalland hog to
North America. As well it will be the first artificial insemination
facility for hog semen in western Canada.
The co-operative will create spinoff employment and
stabilize the incomes of farm members. Those in the Kipling
area appreciated the opportunity to become partners with the
agricultural sector in making sure the program moved forward.
For example, the distribution of semen and the marketing of
breeding animals require transportation. The needs of
transportation will enhance the use of one farm member's
existing trucking equipment, creating additional returns for
him. The co-operative will require production, management and
clerical personnel that will be supplied by farm families to
enhance their farm incomes and to improve individual farm
returns.
The co-operative will be more than a primary producer of
farm products. As a group they will market a product of high
value to the benefit of their members. Their natural geographic
advantage and lower cost of production make their product
competitive in the North American market. This venture
pioneers an innovative process of efficiently distributing new
genetics to the North American hog industry and is very
important to my riding.
None of this would have been possible if FIMCLA had not
been there to guarantee the loans to meet their needs and to meet
their new ideas, the new and better ways of doing things. With
due diligence and proper assessment techniques, FIMCLA
guarantees do not have to carry a high amount of risk. The past
record shows that. Over the last 25 years net losses under the act
have approximated 1 per cent of total loans guaranteed. In the
terrible years during the 1980s when interest rates were high,
low farm income and land devaluation caused more defaults
than usual. The program is an excellent one. This is why the
current legislation is required. It is a safe and inexpensive way
for the government to help farmers help themselves in changing
times.
(1605)
As I drive around my riding talking with people I realize these
sincere, bright, hard working individuals have hundreds of good
ideas. Given a start, they could go far on their own. We need only
to open the door for them.
Furthermore, the amendment includes measures to offset the
natural extra expenses that would come with an increase in the
cap. The amount of offsetting needed is small. For example, an
increase of only one-quarter of 1 per cent in the registration fee
would sufficiently offset the extra costs and maintain the current
level of liability for at least five years. For an average loan of
$27,000 it would be $64.
By not proceeding with the suggested amendment, lenders
would have to stop and discontinue programs once the cap
reached $1.5 billion. It would be irresponsible. Can we imagine
saying no to the co-operatives in Saskatchewan I just
mentioned? Can we imagine telling them that we understand the
project will stabilize income, create employment and enhance
Canada's exports but that some arbitrary cap says they cannot
continue?
That we must increase the cap is positive. It means the
program is doing well. More people are finding out about its
successes and are deciding to use it. It makes possible what once
seemed impossible for them.
With sustained lower interest rates and the improved farm
debt situation approximately 600 new designated lenders and
better marketing of the program have contributed to the success
of FIMCLA. In simple terms, the aggregate limit can be
increased at little or no cost to government and should satisfy
program demand for the next 10 years.
This positive measure is supported by the agri-food sector
and commercial lenders alike. The program has become
increasingly important to rural lenders such as credit unions that
offer credit to farm producers. The Canadian Bankers
Association and Credit Union Central in Saskatchewan support
the proposed increase. The Canadian Federation of Agriculture
and other major farm groups have been consulted and support
the proposed amendment. It is inexpensive and supports the
agri-food sector.
Taxpayers are well served. Improvements made under the
program contribute to the strength of Canada's economy and
decrease dependency on government subsidies.
I ask members to support Bill C-75. By increasing the
aggregate principal amount of loans that can be guaranteed, the
program will continue to be offered to farmers and
co-operatives and will make a difference.
Mr. Allan Kerpan (Moose Jaw-Lake Centre, Ref.): Mr.
Speaker, I have a couple of comments for the hon. member for
Souris-Moose Mountain. We are seeing a classic case of the
government trying to close the door after the horse has escaped.
I get back to what I said a few moments ago. I would like the
member to comment on my idea.
Why could the government not support the idea of
consolidating the three or four federal programs to offer lending
assistance to the agricultural industry?
It is well known that the Farm Credit Corporation exists. Why
do we not remove the other two bureaucracies, the Small
11695
Businesses Loans Act and the Farm Improvement Loans Act,
and put them under the umbrella of the Farm Credit
Corporation?
(1610 )
It would seem a government guarantee to other lending
institutions is a conflict in one way because we would be in
direct competition with the Farm Credit Corporation. What does
the member think about the idea of consolidation and removal of
duplication?
Mr. Collins: Mr. Speaker, with regard to the questions posed
and with regard to FIMCLA we must remember the bill would
increase the cap from $1.5 billion to $3 billion. We have to
maintain that and keep it as the essence of the drive.
We have to review all government agencies, farm credit and
the entire agricultural scene. With that in mind, I am sure the
agriculture minister is looking at all available options.
However, in relation to Bill C-75, I would not want us to delay
very important action on behalf of the agricultural community.
Mr. Kerpan: Mr. Speaker, I would just like to clarify for my
hon. colleague that my criticism is not against increasing the
limit to $3 billion. I understand the need and necessity for it. My
only concern was that we were using band-aid measures and we
could do far more to improve the situation if we opened it up and
looked at the whole picture.
Mr. Collins: Mr. Speaker, I listened rather intently to the hon.
member. In his speech he expressed some concern about the
capping provision. It is very important.
Since the member has an agricultural background, I take very
seriously his thoughts about the whole business of our running
government, certainly in the agricultural sector.
[Translation]
Mr. Jean Landry (Lotbinière, BQ): Mr. Speaker, I rise today
to speak on Bill C-75, an act to amend the Farm Improvement
and Marketing Cooperatives Loans Act.
I believe I am going to please the government by saying that
its plan to increase loan guarantees to $3 billion is an excellent
one. However, if it thinks the criticisms will be coming after the
compliments, it is quite right. Let us first turn to the positive
aspects. In fact, the change is only raising the guarantee ceiling
for loans made by financial institutions, to keep up with the
demand.
According to data provided by the Department of Agriculture
and Agrifood, the programm is very efficient since its cost is
very low. It costs $1.5 million a year, which reflects losses due
to loan default. We are talking about 1 per cent of guaranteed
loans as a whole. This means that with a $3 billion ceiling, the
annual cost should rise to $3 millions, which is quite acceptable.
We are not against logic. According to data also obtained from
Agriculture and Agrifood Canada, in 1994-1995, more than 17
000 loans were made under the Farm Improvement and
Marketing Cooperatives Loans Act, for a total of $475 million.
The total value of guaranteed loans is getting close to the $1.5
billion limit.
The demand and the service provided fully justify the increase
in the guarantee limit. We are not against this measure, which
allows farms to have access to development funds without the
government having to give grants, which come right out of
taxpayers' pockets.
However, a dose of constructive criticism will be good for this
government which does not realize, or chooses to ignore, that
overlap costs money to the taxpayers, who are already
overtaxed, and that it could be avoided.
(1615)
In fact, this measure perpetuates the overlaps between the
federal government department, the Farm Credit Association
and Quebec. Through the Société du financement agricole,
Quebec provides the same services as its federal counterpart.
Yes, more overlap. In one ear and out the other. The population
got the message, and most importantly, understood it. Overlap.
And regarding the case that we are discussing today, we
should specify that there is an overlap not only in activities, but
also in the way things are done. Loan guarantees have their
place, but they increase the debt load of businesses. Everybody
recognizes the importance of evaluating a business's potential
and its market before offering more loans. Too heavy a debt load
makes a business unable to compete. That is why we maintain
that Quebec is in the best position to identify which sectors of its
economy are experiencing growth and to establish policies
regarding access to credit.
Obviously, these policies are geared to the development
strategies elaborated in collaboration with the sector. In its
latest annual report, the Société du financement agricole du
Québec points out that it creates and develops new programs in
collaboration with representatives of the financial and farming
sectors. Quebec has established a tradition of consultation on
farming issues with the États généraux du monde rural in 1991;
the consultation committees which were formed during the
Trois-Rivières Summit in 1992 following the consensus
reached on the priorities for the agri-food sector's development
in Quebec; and lastly, the Trois-Rivières Summit itself.
Quebec has the expertise required to take the program under
its wing, of course, with the corresponding transfer of funding.
The federal government would save a department desperately in
need of saving a great amount of money. Was the Department of
11696
Agriculture and Agri-food not one of the hardest hit by the last
round of budget cuts?
Agriculture and Agri-Food Canada is one of those hardest hit
by downsizing. It does not make sense to maintain duplication
and make cuts in areas where duplication does not exist.
Inspection services will now charge a fee, although we have
three overlapping inspection services. Where does the money
come from to pay for these services? From the private sector,
which ends up paying the price of duplication.
The minister must be aware of the fact that officials who
helped draft this legislation on farm improvement and
marketing co-operatives loans admitted it was competing with
equivalent programs in Quebec. For the benefit of those who
may not be that familiar with the Société de financement
agricole, I would like to comment briefly on its farm loan
operations.
This is taken from the agency's latest annual report. The
Société de financement agricole authorizes and guarantees loans
and credit openings. Farmers can obtain guaranteed loans up to a
maximum of $800,000, while the maximum for loans at reduced
rates is $200,000. The interest rate for guaranteed loans is based
on the residential mortgage rate offered by financial
institutions. Farmers now have the option of selecting a
one-year, three-year or five-year term, at a rate locked in for
the duration of the term selected.
During the 1993-94 financial year, the Société de
financement agricole granted 4,682 farm loans totalling $353.3
million, which represents an increase of 12 per cent in the
number of loans and 39 per cent in the total amount. Out of the
total number of loans, 3,305 representing $279.6 million were
granted at the reduced rates provided under the financing
program.
(1620)
Furthermore, the Société de financement agricole authorized
the transfer of existing loans, representing another $39.5
million. The total amount of loans and transfers was $392.8
million.
In other words, Quebec already offers these services. It is in a
better position to understand what is involved, thanks to a
consultation model unique in North America. Agricultural
partners in Quebec have given a lot of thought to sustainable
regional development.
The Société de financement agricole is closer to the farmers
and to the markets. It is in a better position to develop a
consistent credit policy based on economic development
strategies identified by the parties concerned. If Agriculture and
Agri-Food Canada lets the Société administer the loan
guarantees to which Quebec is entitled, duplication will no
longer be an issue.
Bill C-75 may be worthwhile to farmers in the rest of Canada,
but I have some reservations about the impact of this program in
Quebec. Is the Canadian government going to say yes to a farmer
whose loan request has just been turned down by the Société de
financement agricole? If a project review was done by experts,
is the federal government going to do another one? We are still
stuck in the murky waters of federal duplication, lack of
efficiency and interference.
Furthermore, Quebec already faces duplication through the
presence of the Farm Credit Corporation, which reports to
Parliament through the Minister of Agriculture. In Quebec, we
have shown that the Société de financement agricole is capable
of managing the loan guarantee program. The rest of Canada
could benefit from the expertise of the Farm Credit Corporation,
which is the largest long term lender in Canada. A document
provided by the FCC itself indicates that it has the human
resources and expertise required for agricultural financing.
In addition to providing traditional loans, the FCC can now
finance diversification projects on the farm or value added
agricultural businesses off the farm. In addition, the FCC can
now administer programs and services jointly with federal
agencies, provincial governments and other lenders.
Our colleagues opposite will again tell us there is no
duplication. Officials have said that Agriculture and Agri-Food
Canada's program was not duplicating the activities of the Farm
Credit Corporation, since it did not offer the same program. We
are always hearing these arguments. Once and for all, will this
government not understand that these arguments do not hold
water? Let us look at the thing objectively. Since the industry
seems to consider the program valid, why does the Farm Credit
Corporation not use its own resources to provide it?
The FCC has the capability, with a staff of over 760 people
working out of six regional offices and 101 district and rural
offices. The FCC loans portfolio includes some 55,000 accounts
valued at $3.3 billion.
It is therefore biased, dishonest and wrong to say that there is
no overlap between the activities of Agriculture and Agri-Food
Canada and the Farm Credit Corporation. It has, I repeat, all it
needs to offer the program elsewhere than in Quebec, where the
Société de financement agricole can do the job.
The federal government talks of single window here and
single window there. However, when it comes to making it
operational, it is another story.
Here is the situation. The government takes a perfectly logical
step.
Under the terms of the act, once the $1.5 billion limit is
reached, the government is no longer obliged to guarantee loans
granted by lenders. This obviously prevents new loans from
being accepted under the Farm Improvement and Marketing
Cooperatives Loans Act.
11697
(1625)
So we agree that it is necessary to amend the legislation to
raise the limit of the five year loans to three billion dollars. We
agree on the benefits of such a measure: it will make credit
readily available to farmers and marketing cooperatives, for a
wide range of farm improvement projects.
Furthermore, borrowers will get good interest rates and
requirements concerning their equity will be lowered. The
program encourages investments in new kinds of machinery,
new technologies and different agricultural ventures, as we see
more and more in my riding where there is an ostrich farm, for
example. On those points we agree with the government. But the
idea loses much of its appeal because this government is unable
to tap into existing and competent resources to manage the
program.
We have shown repeatedly, and not only today, that Quebec is
in a better position to identify growth sectors in its economy and
to implement credit access policies reflecting the development
strategies established in co-operation with the community. Yet,
with the Farm Improvement and Marketing Cooperatives Loans
Act, the federal government competes with comparable Quebec
programs.
In Quebec, the Société du financement agricole has all the
necessary expertise to manage the program. Elsewhere in
Canada, wherever the Farm Credit Corporation has offices,
there are also adequate resources for that program to be offered.
So we are once again in the vicious circle of overlap and
duplication where there is no logic.
In spite of a drastic downsizing of the public service, the
federal government is not restructuring its activities efficiently.
There is still some useless overlapping within its
administration. Today, we gave yet another example of that. The
public will have to bear the consequences. So we say stop,
enough is enough.
[English]
Mr. Wayne Easter (Malpeque, Lib.): Mr. Speaker, I am
happy to speak in favour of amendments to the Farm
Improvement and Marketing Co-Operatives Loans Act.
As has been stated previously, we are seeking to amend the act
in order to increase the aggregate principal amount of loans
allowed under the act from $1.5 to $3 billion. The program has
proved very popular with farmers. In fact, I have had
considerable experience with the use of the farm loans act in my
own farm operation.
Consequently, as a result of this demand the present five year
$1.5 billion cap has almost been reached. The Farm
Improvement and Marketing Co-Operatives Loans Act is one of
the best accepted programs in existence by the farm community.
As is seen, it is used substantially.
FIMCLA is a loan guarantee program designed to increase the
availability of credit on reasonable terms to farmers and farmer
owned marketing co-operatives. It allows investments in new
technology and equipment and covers a wide range of farm
improvement projects.
I would throw a note of caution that we have to be careful here
and not just make guarantees for the banks. There is a
commitment by the lending community here and there has to be
a commitment to the farm community as well. We do not want to
see the situation where the banks just use this program when
they really do not need to use it to have a guarantee on the funds
they are lending out. The objective then must be to put more
capital into the system to assist farmers who otherwise might
have difficulty in acquiring loans to get them from the lending
community.
(1630)
The improvements the moneys can be used for include the
purchase of farm machinery, clearing land, installing irrigation
or drainage systems, fences, construction or renovation of farm
buildings and the purchase of livestock or farmland. The loans
can also be used by co-operative associations for investing in
value added production. This could include facilities for
processing, distributing or marketing farm products such as
washing or packaging plants. We have had a considerable
amount of that kind of operation in my riding in terms of the
potato industry.
As well the loans can be used for alternate farming enterprises
such as organic production. That is an extremely important
point. Here is a production base that I think has a tremendous
and an increasing potential. There is very definitely a niche
market in terms of organic products and it will be increasingly
so in the future.
Sometimes it is very difficult for people in the organic
production industry to get loans in the normal course of events.
Extending the amount of money under the act should make it
possible for those people in the organic production industry to
acquire the necessary funds to meet their needs.
It is important to note that the environmental impacts of the
projects are considered. Environmental impact assessments are
commonly used on the larger projects.
Through the program, farmers get better interest rates than
those normally available, usually .5 to 1 per cent below the
prevailing rate. They are also allowed to borrow with a
minimum equity of 20 per cent. This is extremely important
especially to younger farmers getting into the industry or some
of the higher risk farming operations.
The act also facilitates access to credit in rural areas, putting
investment power into the hands of producers and marketing
co-operatives. It strengthens production and financial stability
in rural Canada.
11698
FIMCLA supports adaptation and diversification. It
encourages rural development and sparks job creation. The
program has become increasingly important to rural lenders
such as credit unions and Caisses populaires that offer credit to
farm producers. The Canadian Bankers Association, the Credit
Union Central in Saskatchewan and la Confédération des caisses
populaires Desjardins all support the proposed increase. The
Canadian Federation of Agriculture and other major groups
have also been consulted and support the proposed amendment.
The program has been an inexpensive way for the government
to support primary producers and the downstream industries.
Historically the net loss in terms of lending under this program
has only been 1 per cent. Any extra costs incurred under the new
act will be offset by an increase in the registration fee paid by the
producers and marketing co-operatives that benefit from the
program. Taxpayers are very well served. Improvements made
under the program contribute to the strength of Canada's
economy and decrease dependency on government subsidies.
In conclusion, I ask members to support Bill C-75 by
increasing the aggregate principal amount of loans which can be
guaranteed. The program will continue to be offered to farmers
and farmer owned marketing co-operatives. In so doing, we will
be supporting one of the major wealth producing industries in
this country. We will be ensuring that primary producers, where
all the wealth generates from in terms of the farm production
base, have the availability of capital under reasonable terms so
that they can be the kind of wealth generating industry which so
many other industries spin their wealth from.
(1635 )
Mr. Murray Calder
(Wellington-Grey-Dufferin-Simcoe, Lib.): Mr. Speaker, I
rise today to speak in support of Bill C-75, an act to amend the
Farm Improvement and Marketing Co-Operatives Loans Act.
I would like to begin by commenting on the importance of
affordable financing for the agriculture community. I remember
one of my first encounters with the banks and how without the
farm improvement loan I would have been at the mercy of the
fickle finger of finance. It is quite possible that without the loans
act not only I but many farmers would not have been able to farm
quite the same way we do today. I would like to expand on that.
In 1973 I came back from Stelco and began farming. At that
time I took out a farm improve loan in the amount of $5,400 for a
165 Massey-Ferguson tractor and a four-furrow plough. I know
the member for Malpeque wishes there were farm deals like that
today but there are not. In our farming operations today we
market 360,000 chickens a year, over one million pounds of
meat. I still have that 165 Massey-Ferguson tractor. It is
something that brings this home to me.
An hon. member: What would it be worth today?
Mr. Calder: I think it is worth about $7,000 or $8,000. I could
make some money on it if I sold it but it is a very proud
possession of mine.
The program is designed to increase the availability of credit
to farmers and farmer owned co-operatives at a reasonable
interest rate to improve farm assets and strengthen production
and financial stability.
This act was amended in 1987 by increasing the maximum
amount of outstanding loans for borrowers from $100,000 to
$250,000. It introduced fixed rate loans and loan consolidation
and refinancing. It expanded the scope of the act to allow for
loan guarantees up to $3 million to farmer owned marketing
co-operatives and for value added marketing, processing or
distribution projects. It introduced a registration fee of one-half
of 1 per cent of the loan amount.
Since February 1988 when the above noted amendments came
into effect more than 65,000 loans representing more than $1.5
billion have been made under the act. Since 1990 over 55,000
loans have been made to utilize the act. There are currently 10
active value added co-operative loans totalling $14.2 million.
Personally, I believe that value added marketing is the wave of
the future. We will see this area grow significantly in the years
ahead.
Last year, this act was used to facilitate more than 18,000
loans totalling more than $475 million. The average loan size
for 1994-95 was $27,000 and the five year average is $22,000.
Over the last 25 years, net losses under the act have
approximated 1 per cent of the total loan guarantees. There are
currently two one time fees paid by the borrower. The first is the
loan registration fee which is forwarded to Agriculture and
Agri-Food Canada of one-half of 1 per cent of the loan amount.
The second is an administration fee which is paid to the lender,
the lesser of one-half of 1 per cent or $250 on loans less than
$250,000, or one-tenth of 1 per cent on loans of $250,000 or
more.
The maximum rates of interest which can be charged by
lenders are prime plus 1 per cent on a floating rate basis and
prime plus 1 per cent plus one-quarter of 1 per cent for each year
of a term loan. For example, that would be prime plus two and
one-quarter per cent for a five year term loan. For a loan of
$27,000 the cost would be approximately an extra $67.
Approximately 683 rural lenders, such as credit unions, have
been newly designated as lenders under the act since 1991.
(1640)
Under the existing act, once the five year $1.5 billion loan
guarantee limit is reached, the federal government would no
longer be in a position to guarantee loans made by the lenders.
11699
This would make any further new loans under the act
impossible. Therefore, it is essential to have an amendment to
the act which will increase the five year loan limit to $3 billion.
Having shared with members how I view the importance of
this program, I do not believe the major banks have shared my
opinion. I do not believe the banks have made sufficient
progress in improving access to capital for the agriculture
community. In fact, it has been suggested that the banks
discourage the use of this loan act in favour of loans which
would bring the banks larger profits.
More must be done to address the credit needs of agriculture.
It is imperative. Just as the banks have been slow to finance
small business, the same holds true for agricultural
co-operatives. The banks have acknowledged though that they
can do a better job of lending to agriculture and have taken a
number of steps to improve this situation. However, we continue
to receive the message from the agriculture community that
more needs to be done.
As a member of the federal Ontario Liberal task force on
access to capital to small business, I heard a litany of anecdotal
evidence indicating the banks' indifference to small business.
As a farmer, I was quite aware that many of the concerns of
small business were the same for agriculture.
While it is difficult to document the validity of each
individual claim, the volume of complaints certainly depicts an
uneasy relationship with the banking institutions. I hope that
situation will be improved now that we have the banks' attention
with the levying of the temporary capital tax on large
deposit-taking institutions in the finance minister's 1995
budget.
The government will be working with the banks to develop
appropriate benchmarks for small business. I would define
small business as including agriculture. We promised in the red
book that we would take steps to increase capital availability in
rural areas. We are keeping that promise with the passage of Bill
C-75.
I encourage all members of the House to indicate their support
of the agriculture community by supporting this bill.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr.
Speaker, would my hon. friend from Ontario outline for me
some of the impacts he can see in his area with regard to
FIMCLA being increased from $1.5 million to $3 million? Are
there different agricultural groups that would be able to utilize
that funding? How would the cap feature impact on those groups
at this time?
Mr. Calder: Mr. Speaker, about three or four weeks ago I was
up in the Collingwood area and I had a chance to tour an apple
packing factory. It was busting at the seams. Business was really
good. It has been very innovative. It is squeezing apples for
apple juice. It has come up with a couple of combination ideas
using carrots for carrot juice. It was actually getting to the point
where it was exporting. However, it was busting at the seams and
needed capital to expand.
I would say to the hon. member that this is exactly what he is
talking about. This apple factory is at the three year period and
has to expand its business. It needs new machinery and needs to
expand the building. There will be more jobs created from this.
I hope that has answered the hon. member's question.
(1645 )
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.
An hon. member: On division.
(Motion agreed to, bill read the second time and referred to a
committee.)
The Deputy Speaker: It is my duty, pursuant to Standing
Order 38, to inform the House that the question to be raised
tonight at the time of adjournment is as follows: the hon.
member for Ottawa West-the Public Service.
* * *
Hon. Alfonso Gagliano (for the Minister of Finance, Lib.)
moved that Bill C-70, an act to amend the Income Tax Act, the
income tax application rules and related acts, be read the second
time and referred to a committee.
Mr. David Walker (Parliamentary Secretary to Minister of
Finance, Lib.): Mr. Speaker, it gives me great pleasure to take
the opportunity to present Bill C-70 to the House for second
reading. It is an item arising out of the budget presented in
February 1994.
I will explain the process we go through with a major piece of
legislation such as this one. Immediately after the minister
presents the budget we have a debate on it and it is voted upon.
Subsequently we introduce the budget measures act which
incorporates many of the activities of different departments. It
was begun last year and took up the time of the House of
Commons in May and early June and of the Senate in June. It
was finished before July 1.
Subsequently in the public perception we began to deal with
the budget for 1995 but we had not finished the work arising
from the 1994 budget. Today we are continuing the work from
last year's budget.
11700
Last fall we found out about the changes to the Income Tax
Act, which is the second part of the work done in a budget. At
first we have changes to departmental activities, including for
example the Unemployment Insurance Act. Then we have
changes to the Income Tax Act. Previously the House considered
amendments to the Income Tax Act arising out of the business of
the budget of last year. They were reviewed in the House of
Commons last November and were reviewed in committee in
December. A few witnesses appeared. We considered some of
the changes offered by the opposition and decided to go ahead
with the bill as it stood. It was then presented to the House, went
through the Senate, and is now law.
Because of the enormous number of changes made, we split
the amendments to the Income Tax Act into two different
sections. This is the second section. Bill C-70 represents the
second set of amendments to the budget arising out of the
February 1994 budget statement.
They are a number of technical amendments which affect the
income tax situation of those in the business world and
corporations. In summary, the amendments implement certain
measures announced in the budget of February 22, 1994 as well
as other measures announced by the government in 1994.
The measures are described, first, as debt forgiveness. It
requires a debtor whose indebtedness is forgiven to apply the
unpaid amount to reduce any tax losses and the tax cost of
properties owned by the debtor. Any unapplied balance is
brought into the income by individual debtors whose incomes
exceed $40,000 and by corporate debtors that are not bankrupt
or insolvent.
Second, we are changing some of the rules by which we treat
foreign affiliates. We expand the categories of income of foreign
affiliates which must be reported as income of their Canadian
shareholders.
(1650)
It responds to a widely held view by Canadians. It was a
perspective that we certainly heard about in the late eighties and
early nineties when we were in opposition. Canadians saw the
corporate world was able to transfer moneys to foreign affiliates
and to avoid taxation in certain regimes which they considered
to be too high. We took a very progressive step in our first
budget, the budget of February 1994, to expand the rules and
ways in which we were able to deal with foreign affiliates.
Third, we now require financial institutions to report profits
and losses on securities held in the ordinary course of business,
on income rather than capital on a market to market basis.
I was very much involved with the initial discussions that
were held with industry when we announced the rules. I am very
happy to say the relationship between the financial institutions
and the government have greatly improved through numerous
discussions.
The industry felt at first that the tax measures were too
aggressive and did not take into account some historical
developments, particularly in the insurance industry. We argued
very strenuously that the insurance industry should be
understood. We held discussions not only in Ottawa but across
the country. We listened to representatives of their associations
and met with senior officials of individual companies. They
pointed out that if we did not proceed with some care our
evaluation of their securities and our treatment of their
securities no longer being on the capital side but on the income
side would greatly hurt their business.
The insurance industry is very important to the country. There
are more than 140 active insurance companies. We want to make
sure we stabilize the companies and do not do anything negative
to affect either their capital base or their income base.
After several weeks of discussions amendments were
suggested back and forth. I think all parties will agree that the
rules as finally presented to the House a few weeks ago and now
being expanded upon at second reading are fair to everyone.
We must remember the purpose of the Government of Canada
is to ensure that every corporate sector is taxed properly and
pays its fair share. That is the demand of all Canadians. The
insurance industry has responded admirably. It is more than
willing to pay its fair share and now feels the rules and
regulations we are developing are more appropriate to its
business activities.
I take this opportunity to publicly thank members of the
insurance industry who have taken many hours to explain to me
the nature of their business. Last year was my first year in the
finance field on behalf of the Government of Canada. When that
is the case we need a lot of kindness from people in the private
sector to explain how they operate and the way new regulations
or new tax regimes negatively affect their businesses. There was
no element of hostility. I very much respect their willingness to
spend time with me to ensure I understood their case.
Fourth, in terms of funeral arrangements we are providing an
exemption for interest earned on prepaid amounts under eligible
arrangements entered into by individuals to cover their funeral
and cemetery expenses. This is a combination of federal and
provincial laws, rules and regulations that govern people who
make such arrangements ahead of time.
Through trust arrangements at the provincial level those
funds are protected but because of the high cost of property,
particularly in major metropolitan areas, we found that the
limits originally being considered were not sufficient. The
change is to accommodate the reality of how people are
purchasing plots in cemeteries. We do not feel we are suffering
in any way, shape or form an unnecessary financial burden. We
are
11701
dealing with the reality of the high cost of property. We did not
want to put Canadian taxpayers, the industry or the non-profit
sector in the field at risk through unfair tax rules. These
amendments address the issue.
(1655)
Fifth, we are permitting publicly traded real estate investment
trusts to qualify as mutual fund trusts for tax purposes.
Sixth, we are dealing with mutual fund reorganizations. It will
allow a mutual fund corporation to convert into a mutual fund
trust on a tax free basis and will allow tax free mergers of mutual
fund trusts.
Members of the House will know that the mutual fund
business is one of the fastest expanding businesses in North
America. Every effort has been made at the regulatory level to
keep in touch with the industry and keep up to date with its
changes.
We have sought through the Income Tax Act several other
initiatives in the securities industry to ensure the tax regime is
fair to people in the mutual fund area and is current with
established practices. As time goes on, if the industry continues
to change as fast as it has, we will have to make future changes.
Seventh, we are dealing with objections and appeals. This
requires large corporations to specify in notices of objection to
income tax assessments the issues under dispute and the amount
of relief sought.
The House may be familiar with the past practice of legal
departments and taxation departments of corporations sending
notices of appeal to Revenue Canada on a regular basis,
indicating that they have an objection to the taxes being
assigned by Revenue Canada. By making a general objection as
they have in the past they have been able to wait for specific tax
cases to come forward. Once the tax cases are registered they are
able to re-examine their books to see if they apply. In theory that
has caused the Government of Canada to have a great deal of
liability each year in the corporate tax sector.
We are seeking to limit the liability in the future within a
specified time that we think will give the corporation a lot of
time to review its tax assessment. The notice of appeal should
specify exactly what is being appealed. It is no longer suitable to
have a general appeal against the tax assessment. The
corporation must specify exactly what it is objecting to and
proceeding with, if necessary, through legal action. That will
give Revenue Canada and the Government of Canada an
opportunity to proceed without having to worry about
innumerable court cases in the future.
The eighth section deals with securities lending. This will
permit investment dealers to deduct two-thirds of dividend
compensation payments made in securities lending
arrangements.
The bill has a fairly broad range of measures. It complements
the original budget speech, the budget bill introduced last year
and the changes to the Income Tax Act dealt with in the fall of
1994 that were finished in the spring of 1995. The bill introduces
specific measures that are very compact including funeral
arrangements. It establishes the principles of fairness long
talked about by governments but rarely acted upon.
The objections and appeals, the opportunities to challenge tax
rulings and deal with the tax payable by foreign affiliates, are
fair measures. The Minister of Finance has done an excellent
job. He stated quite often that the government would not let up
on bringing more fairness to the tax system. Those measures
will be benchmarks of the new fairness in the Income Tax Act
dealing both with corporations and individuals.
(1700 )
When we have made major changes affecting an industry such
as the insurance industry we have proceeded not only with a
determination to make things fairer for the whole sector but we
have been responsive to criticisms and to critiques. We have
been willing to talk with these people and to talk to the
executives of the different companies and to the associations
and to respond when a point is well made.
To have good tax law we have to be determined to be fair but
we also cannot be stubborn and in the face of obvious mistakes
hold to a position which puts companies at a disadvantage. I
have learned a lot about the insurance industry as a result of
these measures and I am hopeful we will continue to have these
discussions in other spheres.
The government welcomes the opportunity to open up this
debate, to have second reading on Bill C-70, amendments to the
Income Tax Act. We welcome comments from the opposition
and its critique on what we are trying to do and its suggestions
on how we can make the Income Tax Act fairer in the future.
We also welcome the opportunity to hear from witnesses in
committee both in the House of Commons and later in the Senate
so that the views of professionals in the field can be heard, taken
seriously and government can continue to refine the Income Tax
Act to be fairer and more just to more Canadians and as we
proceed over the years to make further amendments to ensure
every Canadian is paying his or her or corporate fair share and at
the same time finds the system just in the way they are treated
and in the way other people are being treated.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, I thank the government for giving us this opportunity,
through Bill C-70, to speak not only on particular provisions of
the bill, which enacts certain measures put forward in last year's
11702
budget by the finance minister, but also to raise the whole issue
of reviewing Canada's tax system.
I can tell you right off the bat that the official opposition will
not support Bill C-70 at second reading stage, not because of
any specific measure, but because of the lack of significant
action on the part of the government regarding tax loopholes and
the review of the tax system the Bloc Quebecois has been
requesting since the Liberals came to power, nearly 15 months
ago.
A little while ago, I listened to the secretary of state talk about
an in-depth review of the tax system, of the openness of this
government regarding the inequity and unfairness of the
Canadian tax policy. Pretending to be concerned with equity and
social justice, this government has done nothing to plug tax
loopholes since it came to power.
All this is contrary to what the red book said. The government
no longer refers to the red book, which was waved at us month
after month, because it is ashamed. It can no longer establish
any parallel between its election promises and its action in the
area of taxation. In fact, the red book contained many Liberal
policy statements on tax fairness, pointing out to the fact that in
this great country which prides itself on being fair from coast to
coast, as the Prime Minister likes to say, there are totally unfair
situations.
As a matter of fact, the red book mentioned a few. It said that
some corporations had not paid a cent in income tax for years
because of the previous government's laxness and the fact that it
supposedly had many friends among big business, which was
not the case of the Liberal Party. The Liberal Party, too, had
criticized the fact that, since 1984, personal income tax had
increased much more rapidly than corporate income tax. If I
remember rightly, according to what the Prime Minister said at
that time, it wanted to correct all the unfairness and injustice in
the tax system in the first two years of its mandate.
Since they have been in office, the Liberals have not fulfilled
their undertakings. They have not fulfilled the promises they
made during the campaign in order to get elected.
(1705)
Let me give you some examples of unfairness in the tax
system. Let us take, for instance, the family trusts. It is not for
nothing that, for the past 15 months, since our arrival here, we
have been saying, over and over again, that the tax rules for
family trusts are unfair to all the taxpayers in Quebec and
Canada. It is no coincidence if we have been pestering the
government about every second day since 1993 about family
trusts. It is because this tax system is truly unfair to Canadians,
from whom the government asks more and more sacrifices
because its finances are in a sorry mess, while at the same time
the richest Canadian families are allowed to accumulate capital
gains year after year without paying any income tax for up to 80
years.
Even the tax experts are divided on that issue. Some work for
the very rich Canadian families, others take a view more
compatible with the interest of the general public. Some of
these, for the last two to three years and even since the review,
four and a half years ago, of family trusts and the 21-year rule,
have sharply criticized the perpetuation of such a measure and
the possibility to defer income tax on capital gains for up to 80
years.
As the official opposition, we have made this issue one of our
favourite themes, especially since we obtained sketchy
information from the private sector and some Canadian
universities that lead us to believe that hundreds of millions and
even billions of dollars could be recovered by abolishing certain
privileges linked to family trusts. We know that those trusts
have become a major means of tax planning for the wealthiest
Canadian families, individuals and companies.
We are not talking here about the principle of family trusts,
which can be a good thing. We are not talking about the principle
of family trusts, which may apply, for instance, to families with
a handicapped child who will need to be taken care of in the
future, even once his parents are dead. We are not against the
whole idea, nor the administration of these trusts, but what we
have been questioning since we arrived here, and even before,
during the election campaign, is the fact that a millionaire can
use this system to defer indefinitely taxes on his or her capital
gains. We cannot accept that.
What did the Minister of Finance give us in his last budget?
He wanted to look good. He said: Since I cannot stand the
official opposition complaining about such a blatant case of
unfairness and injustice in the tax system, I will mention the
words family trust in the budget speech to shut them up in the
future. But he forgot that we have ears to listen, eyes to read and
brains to analyze.
When he brought forth his measure, saying that he would
eliminate fiscal benefits for family trusts in 1999, he took us for
something that we were not. He also took Quebecers and
Canadians for something that they were not, because he knew
very well that, by putting off to 1999 the necessary change only
for family trusts, he was warning rich Canadian families four
years in advance so that they could get ready and take out the
hundreds of millions of dollars, even billions of dollars that they
had put into these trusts and transfer them to other financial
vehicles, other powerful tools of tax planning. We have not dealt
in any way with all the tax loopholes that these rich families and
all the big Canadian corporations can benefit from.
Is that how the government sees social justice, and fairness in
the tax system from coast to coast? Is this how the government
shows its concern? This government has only one concern: to
look good. It does not matter what the substance is; the impor-
11703
tant thing is to look good. The last budget, like the previous
budget and Bill C-70 before us, shows us this government's
propensity for cosmetic changes, for phoney tax reforms that do
not change anything.
(1710)
One should also look at the tax agreements signed with
countries considered to be tax havens. We in the opposition
refuse to let the government get away with this. We have been
hounding the government since the last election campaign so
that, ever since the 1994-95 budget, the Minister of Finance
tried to silence us, to stop us from denouncing the inequities and
tax loopholes in these tax agreements by putting up a
smokescreen.
At that time, the Globe and Mail called the Minister of
Finance, with good reason, the stand-up comic of Canadian tax
policy. The minister presented things very dramatically but with
such a lack of substance that, a few minutes after he delivered
his speech, it was easy to see that nothing had changed with
respect to tax agreements. Even the Auditor General of Canada
said soon after the budget was tabled that, with the exception of
some administrative adjustments allowing businesses to take
advantage of tax agreements with countries considered to be tax
havens, nothing had changed in the tax system in this regard.
What does this mean, that nothing has changed? It means that,
again this year, next year, and in two, three or 10 years from now,
the Canadian tax system will still provide for this kind of
agreement, which is not a bad thing per se but which makes a big
difference when such agreements are signed with countries used
to shelter billions in Canadian and U.S. dollars, and tens of
billions of dollars in European and Japanese currencies.
You know that such tax treaties enable certain Canadian
businesses to open dummy subsidiaries offshore, carry out no
business activities offshore, pay no tax or very little abroad, yet
claim in Canada losses they did not even incur abroad, just for
the sake of reducing their operating results in Canada and avoid
paying their fair share to the Canadian tax authorities.
We are not talking about small and medium size businesses,
the vast majority of which do their corporate duty and pay their
fair share of taxes, but large corporations which can take
advantage of loopholes in the Canadian tax system that were
plugged neither in last year's budget nor in the finance
minister's latest budget and are allowed to remain, although the
Liberal government claims to be concerned about fairness in the
tax system.
These tax treaties signed with 16 countries considered as tax
havens are key to or at least instrumental in the federal
government's improved performance in managing the Canadian
tax system. Yet, the Minister of Finance continues to maintain
that these are good tax treaties, that there is nothing wrong with
these treaties and that, in this age of globalization and
internationalization of trade, it is natural to sign tax treaties with
other countries.
We have always maintained that it is natural to have tax
treaties and that, when businesses open subsidiaries offshore
and pay taxes abroad roughly equal to what they would have
paid in Canada, such treaties should be signed to prevent double
taxation and ensure that the production system in which
Canadian businesses operate is fiscally equitable, promotes job
creation and so on.
However, we are utterly opposed to signing with tax havens
treaties which, in the opinion of the Auditor General himself,
make no sense whatsoever. The internationalization and
globalization arguments do not hold up when, by raising very
little if any tax revenue from large corporations taking
advantage of such tax loopholes, the fiscal position of Canada is
not only threatened but made worse.
The Department of Finance stopped releasing figures because
they are too shameful. In 1991, the last year for which such
statistics were available-as statisticians would say-the last
year before the previous and the current government felt to
ashamed of these results, no less than 77,000 Canadian
businesses did not pay a cent in tax. But then again, we were told
it had to do with the businesses' production cycle. That is
understandable.
(1715)
We can understand that a business may need to develop its
products or services over a period of one, two or maybe three
years before turning a profit, gaining a share of the market, or
preserving a share of the market for a specific product.
However, there is a problem when the production cycle lasts for
a period of five, seven, ten or twelve years, during which the
business does not pay any taxes but registers a profit every year,
such as the banks which made profits of $4.8 billion last year
while paying hardly any taxes.
When I see that CN makes profits, pays its president a salary
of $350,000 per year and grants him an interest-free loan of
$400,000 to buy a house in Westmount, while at the same time
acting in an inhuman if not barbaric fashion in the rail dispute, I
wonder about this government's intentions and its election
commitments regarding equity, social justice, the respect of
rights, as well as fairness in general. Something is wrong
somewhere. Incidentally, CN did not pay taxes either.
There is a problem with taxation and these few
measures-although we feel some are valid-are so minor given
the scope of the flaws in the Canadian tax system, which has not
been reviewed in 35 years, that we simply cannot support and
praise the government for such minor initiatives.
Among others, Mr. Séguin, a former Quebec revenue
minister, says that, for 30 years now, the only changes to the
federal tax system-I am not quoting him directly- were the
inclusion of new elements or some minor reforms to that system,
and that all this was essentially a top-loading exercise, in the
sense that
11704
new measures were added to existing ones, thus turning the
Canadian tax system into a monster.
As a new member in the House, particularly as the finance
critic, you do your very best to have a thorough grasp of all
issues. And in order to do so, during the first months, in order to
learn every aspect of the issues, you request a lot of
documentation. I challenge you, Mr. Speaker, to try to read all
the documents on Canadian fiscal policy. It is quite an ordeal
when you consider all the explanatory notes, all the bills, all the
related regulations, all the sub-regulations that have been added
on. I challenge you to read all that within a ten-year period, and
I will congratulate you if you succeed.
In the United States, under Mr. Reagan, they had the same
problem. We all remember that one of Mr. Reagan's constant
refrains was a reformed and simplified income tax system, even
if he was more favourable to businesses than to individuals, but
the intention was there. He reformed the American tax system
and simplified it at the same time. You can always question the
fairness of this process, the propensity to favour corporations
and high income earners instead of low and medium income
taxpayers, but in the end the tax system was simplified. People
can see exactly what the taxation levels are. They can see where
the system is unfair.
Here, we have to rely on experts or the members of the official
opposition to scrutinize the tax system and tell the Canadian
population what it really looks like. To point out to the Canadian
people, for example, that 50 years ago, 50 per cent of all tax
revenues were paid by individual taxpayers and 50 per cent by
corporations. However, corporations nowadays account for
around 17 per cent of all tax revenues and individual taxpayers
make up the rest. We have to tell the people, because they will
not hear about this from government members who tend to hide
these things, just like the Liberal Party did during its first
mandate.
I remember that it was then that the gap between individual
taxpayers and corporations began to come to light.
(1720)
Friends of the Liberal Party had already been taken care of
during the earlier mandate of the Liberal Party of Canada, and it
is still going on. Anyone can compare the list of large donors to
the chest of the Liberal Party of Canada and the list of tax
policies that have not been reformed because they are just what
big corporations want.
When we see that the Royal Bank, for example, pours over
$45,000 each year into the chest of the Liberal Party of Canada,
we understand why in the last budget Canadian banks had
nothing but a small income tax increase of $150 million over
two years even though they made profits of almost $5 billion.
We also understand why they are the main beneficiaries of the
computer development programs provided by the federal
government. When we see that the large corporations managing
family trusts give between $35,000 and $67,000 to the Liberal
Party's chest, we understand why they have until 1999 to adjust
to the new family trust provisions. I find it-
An hon. member: Incredible.
Mr. Loubier: -yes, incredible, the member takes the words
right out of my mouth. I find it incredible that they would have
the nerve to present Bill C-70 as a major tax reform, like the
secretary of state did a few moments ago. All they are doing is
adding a few minor positive elements and a few negative ones,
again to make taxation even more complex.
I will tell you that it is a lot easier for this government to make
cuts in social programs and to make outrageous cuts in the
unemployment insurance fund. The federal government is no
longer contributing to the unemployment insurance fund, but it
will still take about $7 billion from it over the next three years.
Over the same period, that is from 1994-95 to 1997-98, it will
also take from the provinces the money it cannot obtain by
closing loopholes in the federal tax system because it wants to
protect wealthy party cronys or the large corporations which
also happen to be important contributors to the Liberal Party
fund. It will cut transfers to the provinces by $12.3 billion. It is
offloading onto the provinces the problems created by its
mismanagement of federal public finances.
It is passing on to the provinces a possible lowering of our
credit rating by the large bonds rating firms because, as Moody's
has shown us, the federal government, even though it is
represented by many stand-up comics, does not escape a serious
analysis of our fiscal situation, of its unwillingness to correct
this situation and our tax system in particular and to review all
public expenditures item by item, including tax expenditures, as
we have been asking since we arrived here.
Moody's has understood that, although this document is some
225 pages long, it is not with these insignificant reforms which
make our tax system even more complex that we will regain
control over our finances, over our tax system and over the
government's present and future revenues.
Moody's has understood one thing, and we can quote that
agency. It has understood that this budget contained a lot of
weak measures. There were measures that were supposed to
allow the Minister of Finance to meet his objective of a deficit
representing 3 percent of GDP for 1997-98, or $25 billion, but
11705
after that, there is nothing, just a big blank. We do not know
where we are going. Moody's understood that.
Moody's understood that in spite of all the cuts made at the
expense of the unemployed, the seniors, the students, and the
provinces, there is no way we can turn the situation around with
this system. As Moody's put it, they could not see how in the
medium term, we could control the deficit, much less the federal
government's accumulated debt.
(1725)
I have a feeling that Moody's can make calculations spread
over more than a few months or one year. Moody's estimated,
probably just as we did, that in spite of all the sacrifices and in
spite of the last budget and the one before, from which Bill C-70
stems, which are purported to be important and major steps on
the way to recovery, to a reduction of the impact of the debt on
the Canadian economy, in five years, the accumulated federal
debt will exceed $750 billion and be closer to $800 billion.
Moody's understood that.
People at Moody's have a good appreciation of our situation,
and they know how to interpret figures. They know there is no
hope in the medium term, and even less in the long term, that
this government, with its timid reforms of the Canadian tax
system, will ever regain control of our financial situation,
restore fairness to the tax system, and make it work smoothly.
Moody's made a proper assessment of the Canadian situation
despite what the intergovernmental affairs minister said after
Moody's report was made public, and despite the answers the
Prime Minister gave during question period this afternoon to the
effect that Canada would have the highest gross domestic
product growth in industrialized countries. Despite all of that,
Moody's understood many of the problems in the Canadian
economy.
First of all, if Canada has the best economic growth
performance of all industrialized countries this year, it is
because it was so far behind. Canada was the first to go into a
recession that was the direct result of the monetary policy
deliberately implemented by the Bank of Canada, a policy that
brought us the worst recession in the whole Canadian history.
Moody's understood all of that. When a country goes into
recession before other countries, a stronger economic recovery
is normal, especially the technical recovery that we are
supposed to have had for three years. Moody's has understood
that such a surge of economic growth is only temporary.
We are glad that the more substantial recovery we have waited
for so long has finally begun. We hope that this year, the
economic recovery will truly lead to the creation of quality jobs
for all Quebecers and Canadians. On the other hand, Moody's
praises as we do the economic growth which is unrelated to this
government's policies, even if the government claims the
contrary at every opportunity.
Economic growth is part of a normal economic cycle where
the slowing down and the trough have lasted longer than usual
because, I submit to you, of structural adjustment, globalization
and of the new international situation, but in fact, this is quite
normal considering that we were in the basement and that we are
trying to stay on the ground floor over the next year.
Moody's adds, and we agree with this analysis, that as soon as
the Canadian economy slows down-not in ten years, but at the
end of 1996-partly because of the slowdown of the American
economy as early as next year, the effects will be very severe.
This is why Moody's indicates that the deficit problem is not
under control, much less the debt.
Why? Because if, in one year and a half, Canada falls back
into a recession cycle, tax revenues are going to decrease, which
means that investor confidence is going to diminish because the
federal government's deficit problems could, as soon as
1997-98, be greater and require even more draconian cuts than
the ones which have been imposed on us by the Minister of
Finance these last two years and which did not solve anything.
This means that foreign investors in particular, and Moody's
was speaking to them, will start asking some serious questions
about the future of the Canadian federation, the future of this
government, if we are still stuck with it in Quebec. They will
have serious reservations. Foreign investors will start
wondering whether Canadian securities are a safe investment,
because when the next recession comes around, with a debt
which by 1997 will probably be close to $650 billion, it is really
going to hurt, because we will need an increasing amount of
money to service the debt. Since Canadian savings are not
enough, foreign markets become an indispensable source of
financing for the Canadian government, and the interest rates we
will have to pay then, as a result of Moody's downgrading our
bond rating-I can tell you Quebecers and Canadians are going
to feel it.
(1730)
And what caused all this? The Minister of Finance, instead of
indulging in theatrics and looking only at the short term, should
have looked beyond the next federal election and beyond the
referendum campaign in Quebec. He should have acted
responsibly and done more than this superficial patching. He
should have proceeded, as we requested, with a genuine review
of public spending and the tax system, the tax loopholes he has
yet to close after almost two years of Liberal government. That
is what caused all this trouble.
It is not a question of what will happen in the short term. The
financial community looked at the short term. Everything is
fine, but that will not be the case next year and in two years, it
will be even worse. Moody's takes a much longer view. I respect
11706
this firm because it had the guts to do this, although it was under
political pressure, because as you know, bond rating firms are
regularly approached by lobbyists. Lobbyists are not just on
Parliament Hill. There are lobbyists on Parliament Hill who go
to see these people or the firms go directly to the Minister of
Finance. They realize what is going on.
Those who today blithely say that Moody's downgrade will
have no short term effect are also irresponsible because of the
message they are sending to the government. I am talking about
large financial institutions in Quebec and elsewhere in Canada;
some are arm-in-arm with the Liberal Party while others have a
certain integrity we can respect. However they behave in an
irresponsible manner when they say that all is well, that the
financial sector anticipated Moody's downgrade and that the
federal government was forewarned on February 11 of the
impending downgrade but was reassured that the economic
growth was there to offset it.
In my opinion, all partisanship and opinions on the
constitutional debate aside, saying such things is irresponsible.
Some people are irresponsible enough to say that all is well.
They are applauding the government even though it has failed to
make the structural reforms, the deep structural changes that
such a disaster calls for. Two years from now, these same
people-I have them on record-these very people will be
saying: ``Two years ago the federal government should have
taken more effective measures, stricter measures to get the
public finances in order. It should have reformed the tax system
two years ago. We could have avoided this utter tax mess. We
would also not be stuck with a recession made twice as bad as a
normal recession because investors holding Canadian securities
have lost confidence in our system and in the government's
ability to manage the public purse''. These people in two years
are going to say exactly the opposite to what they said last week
or even last weekend about the impact of Moody's reduced
rating.
I would ask them, if they still have a sense of responsibility, to
remind the federal government that it should not take short term
holidays. It should set in motion what we have been asking it to
set in motion since it took office. It must review everything it
does here while awaiting Quebec's decision to leave the system.
It is a system we consider to have no future, one that has shown
itself to be, in the absence of tax reform alone in the past two
years, immovable and, in terms of the constitution, irreformable
and inflexible.
Even with respect to tax reform, it is immovable. Perhaps
because of the size of the machine and of the task, but it is
immovable primarily because the government is defending
interests other than those of Canadians and Quebeckers, I
believe. The lack of a clear stand in favour of fairness in the tax
system, in favour of a complete review of taxation and in favour
of the establishment of a parliamentary committee to review the
whole matter tells us it is time to ``get the heck out'', as the
current expression has it, and I am talking to Quebeckers here, it
is time to get out before choices are made for us.
(1735)
You only have to look at the history of Argentina or Mexico.
People say that countries in Latin America cannot be used for
comparison purposes. But it is not true. In the early seventies,
Argentina was thought to have a brilliant future, a country rich
in resources, just like Brazil. Remember, until the early eighties,
we were talking about the Brazilian miracle. Opportunities were
endless.
The same went for Mexico. When Pemex was created,
enthusiasm ran high. Wealth was assured. The debt problem was
not nearly as serious as the one we now face in Canada. And yet,
these countries collapsed and the International Monetary Fund
imposed on them measures that they should have imposed on
themselves, but in a more humane and gradual way, to cause as
little hardship as possible to individuals as well as businesses.
Radical cuts were imposed on them.
I remember in 1984, before joining GATT, which is now
known as the World Trade Organization, Mexico was told to cut
its education expenditures by half. All at one, expenditures had
to be cut by 50 per cent in education, 30 per cent in health and 45
per cent in rural development-and in Mexico, the rural sector is
extremely important, much more so than in Canada. Yet, this is
the kind of measures that were imposed on Mexico.
If, according to Moody's in particular, but also many others
who, before the budget was tabled, shared Moody's views and
those of the Official Opposition, the federal system is presently
in shambles, with $548 billion in accumulated debt, just imagine
what it is going to be like five years from now, when the debt
will reach and possibly exceed $800 billion. This growth, from
$548 billion to $800 billion in five years, not counting inflation,
will cause a serious problem.
All this to say that we are ashamed of the only reform measure
before us and not a very substantial one at that, changing a few
minor aspects of the Canadian tax system and a few minor
regulations, when what is needed is a comprehensive reform, if
Canadians agree to keep this system. But when these changes are
said to be urgently required by the Canadian tax system, that is
too much.
I will therefore suggest that my colleagues from the Official
Opposition vote against Bill C-70 because, in our opinion, in
terms of tax loopholes, redressing inequities in the Canadian tax
system and the sacrifices big businesses that shirk their fiscal
duty as well as some extremely wealthy Canadian families are
asked to make, it does not go far enough. We have been calling
for much more than that in the past 15 months. We want real
reform, we want the red book promises regarding tax reform to
11707
be carried out and true tax justice to be felt in this country before
Quebecers leave it.
[English]
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, the
previous speaker from the Bloc Quebecois talked about how
important it is that we overhaul the whole system and how
ashamed he is that we are only tinkering with the system.
It brings to mind some comments I was reading in the paper
over the last few days about how the Bloc Quebecois feels it can
overhaul the whole system. However, now we find it is
retreating. Rather than full blown separatism we now find the
premier of Quebec saying he does not think that will to fly, water
down the whole message, talk about something a lot less
draconian than complete separation. Along with the leader of
the Bloc Quebecois he now thinks perhaps some form of
economic association would be the way to go. That is exactly
what they have at this point.
In reference to the previous speaker's comments that he
would like to see a full blown overhaul of the whole tax system, I
put it in the same context that perhaps the full blown overhaul of
the political system in Quebec and in Canada would not go very
far either. Let us hope it would not.
That does mean to say this bill is a wonderful piece of stuff.
Bill C-70 was a year old before it was even introduced in the
House. This pertains not to the budget introduced six weeks ago
but to the budget introduced a year and six weeks ago. It has
taken the bureaucracy a whole year to come up with 200 pages of
what virtually every Canadian would call unintelligible
gobbledegook. It is far beyond the comprehension of most
people.
(1740)
This is how we run our tax system today. Not only has the
Income Tax Act become incomprehensible to Canadians, it has
become incomprehensible in many ways to accountants. It is
incomprehensible in much the same way as the Chief Justice of
the Supreme Court was saying last week that the legal system is
going to collapse under its own weight because it has become so
complex that even lawyers cannot understand it.
The Income Tax Act is going the same way. It has become so
complex with additions, deletions, amendments and changes
that even accountants cannot figure out what is happening. We
then add even greater complexity. Accountants are supposed to
be able to figure all this out in anticipation of legislation that is
only being introduced now even though the finance minister
announced his intentions over a year ago. The income tax people
have been assessing tax returns this year based on the contents
of this bill. However, it was only tabled on February 16, 1995.
People did their tax returns before the legislation was tabled in
anticipation of trying to do their tax returns based on
information that did not even exist.
How do we expect accounting professionals to do an
admirable and efficient job of trying to advise their clients on
how to do their tax returns when they are doing it all on the basis
of a statement by the Minister of Finance with no legislation to
back it up and no real assurance that it will pass? We still have to
vote on it. I hope that is not a perfunctory situation.
Parliament holds the public purse. The House gives the
executive the authority to raise money. It is raising the money
and now it is asking us if it can. What happens if we say no?
Perhaps we should say no. I think it is paying lip service to
Parliament.
It is an insult to Parliament that the executive can tax
Canadians, impose rules, penalties and conditions all on the
supposition that it will introduce legislation at some future time.
It will then ask Parliament to vote on it and say it has been
working on the premise that we were to approve it. What kind of
way is that to run a country? Perhaps that is indicative of the
kind of mess we are in because, as everybody knows, we are
right up to our neck and over our head with a debt of $515
billion.
By the time the government has been in office three years it
will have added $100 billion to the debt. By that time it will only
have reduced the deficit by $15 billion, from $40 billion to $25
billion.
This policy of gradualism to deal with a crisis in a fiscal
situation is not good enough. One hundred billion dollars in
interest at 8 per cent is $8 billion more that we will transfer to
lenders each year. That means taxes paid by the rank and file
Canadians will be transferred to the banks in the United States,
Germany and Japan, not back to the taxpayers of Canada. They
will not see it.
We are paying the money lenders and they now control the
way the country is run. That is a desperate and most unfortunate
situation. The Liberal government seems to be totally incapable
of grasping the severity of the situation.
Reformers have said get the budget balanced, do not worry
about 200 pages of nickels and dimes and changes in the
complexity to the Income Tax Act. Let us talk about
simplification. Let us talk about getting the budget balanced. We
said that it could be done in three years.
The government has a revenue of approximately $120 billion
a year. In three years it will have three times $120 billion, which
is $360 billion, and during that time it can only find $15 billion
to squeak out of there. Is this draconian? Is this really grasping
the issue and saying let us get the job done now? I doubt it. I do
not think so, and my colleagues agree with me.
(1745)
It is a shame that parliamentarians in charge of running this
country feel that this policy of gradualism is the only way we
can address the issue as this great country sinks beneath the
11708
wave of debt. The interest is now the largest cost by far to the
government, $50 billion a year.
When the Liberal government was in power 20 years ago and
the Prime Minister of the day decided it was time to open the
gates and let money be spent, flow like water, would Canadians
have voted for them? Would Canadians vote for them today if
they realized that $50 billion a year is spent on interest to pay for
past excesses and the way previous governments have tried to
buy votes with our own money? Now we are spending $1,500 per
man, woman, and child just to pay the interest on that debt.
If and when we get the budget balanced, for ever dollar in
taxes we are going to collect from Canadians, we will only be
able to return 60 cents in services. The rest will go to pay the
foreign lenders. That is no value for money. You pay a dollar and
you get 60 cents back on your investment. What kind of deal is
that? Who goes down to the local store and spends a dollar and
expects to get 60 cents in value for the money spent?
They will tell the government that it is out in the next election,
because obviously it does not know how to deal with the
problem. Remember that the members of the government are the
ones who at the last election were parading around the country
saying: ``Trust us, we are going to get rid of the GST''.
Mr. Mills (Broadview-Greenwood): And we will.
Mr. Williams: And they will-well, maybe hell will freeze
over first.
They say they are going to get rid of the GST. They said in the
red book they are going to get rid of the GST. They have not even
talked about it. It has not even been mentioned. When was the
last time we heard a member of the Liberal government stand up
and say they are going to get rid of the GST? It is one of the little
things they hope will go away. They tore that page out of the red
book and reduced it by one page. That is one promise they are
conveniently forgetting to deliver on.
Canadians are still mightily upset, because they were
promised that the GST was going to reduce the debt. Has the
deficit gone down? Has the debt gone down since the GST was
introduced?
Mr. Grubel: No.
Mr. Williams: No, it has not. Not only has it not been
reduced, but the debt continues to rise and we continue to sink
under the weight of interest payments that we cannot afford. The
government made promises it knows it cannot fulfil, all in the
hope that Canadians would vote for them. And they did,
misguidedly, unfortunately, because we now find out that the
government is not going to live up to the promise of getting rid
of the GST.
At least the Reform Party was honest and open when it said we
will get rid of the GST once the budget is balanced. Let us get the
hard stuff done first.
Mr. Jordan: It is pretty safe for the Reform Party to say that.
Mr. Williams: Let us get the difficult job of balancing the
budget done before we give any tax relief. That was the
commitment we made. We said we would have tough and
difficult times and we are going to have to reduce expenditures.
But while we reduce expenditures, which means we will be
spending less on Canadians, we did not promise any Canadian
they would get tax relief. We thought that was unfair. We did say
that there was light at the end of the tunnel. Let us get the job
done. If and when the job is done, then we will promise to phase
out the GST at that time.
Colleagues from the other side went across the country saying
``We will get rid of the GST if you vote for us''. Well, Canadians
may have voted for them, but Canadians are still waiting.
Unfortunately, the bad news is that Canadians are going to have
to wait a long time before this government delivers on that
promise.
(1750)
Our credit is going down the drain. Moody's has downgraded
our rating. Where is it going to end? We are now paying higher
interest rates because our credit has gone down. That means that
business has to pay higher interest rates. It means that the
government has to pay higher interest rates, and that means that
the Canadian taxpayer will have to pay more taxes.
This government cannot manage the affairs of the state.
Moody's has downgraded our credit rating and that will have
ramifications for years to come. How will we be able to regain
our AAA credit rating? How will we be able to stand up as one of
the great nations of the world?
Canada has a fabulous bounty of natural resources. We have
hydrocarbons, we have prairie wheat fields, we have
hydroelectricity, we have forests, we have minerals. It is all
gone, because we went to the bank and put it up as collateral to
borrow money to buy more votes. Here we are today in one of the
greatest countries of the world. We have natural resources in
excess. We have opportunities. We are the light for people
around the world who can only dream of a country like Canada.
There are opportunities for anyone who wants to come to this
country and work hard and prosper. That was the great Canadian
dream. People could come here with freedom, with hope and
with opportunity. And they came by the millions. They
populated this country and they built this country, only to see
what they had built come down around their ears by the
mountain of debt that has been foisted upon them by
governments that care less about Canadians than their own
self-interests.
11709
The tax system in this 200-page bill has many pages that are
incomprehensible to many people. Let me speak to a few of
them.
In some ways, while the government has said that it does not
want to increase taxation, it is casting the net wider so that it can
catch more taxpayers. Even though tax rates are not going up,
the government is doing its darnedest to ensure that more people
pay taxes. That is the essence of Bill C-70.
The government talks about cleaning up the provisions for
debt forgiveness. Debt forgiveness is a situation where a
business or an individual runs into serious financial problems.
Let us say that someone owns an apartment building and that the
value of the building goes down because there are no tenants.
The rents cannot meet the mortgage payment and the mortgage
company forecloses. He has lost his investment. But the
Minister of Finance wants his pound of flesh. That person has
suffered a major setback. It could apply to someone who has a
rental property of a house, or it could apply to someone who has
a business-somebody who has, for one reason or another, had a
reversal of his financial fortunes and has had to go to the lender
to ask for a forgiveness of the debt because he can no longer
afford to pay. And the tax man says ``Before you do that,
remember that you owe me''.
He owes the tax man in a situation where his financial
fortunes are going down rather than up. I always thought this
was an income tax. I guess not, because the Minister of Finance
feels that it is his duty to stick his hand into the pocket of even
the businessman whose business has failed.
(1755)
What about some of the other situations, such as taxation of
income from foreign affiliates? I know that there have been
situations where business has been found to try to minimize
their taxation. However, here we have again an expanding of the
circumstances into which income from property-which is a
passive income, as opposed to active or business income-of
foreign affiliates is not taxable in Canada.
We are trying to cast further and further afield. Now we are
casting abroad to ensure that a nickel earned anywhere in this
world, not just Canada, does not escape the Minister of Finance
and his bureaucrats' fingers, which seem to go all the way
around the world to get that last dime of income tax to pay for
the debts and the interest and so on, which is killing this country.
Then we have the financial institutions and the securities
dealers. We are now going to change the rules for them too and
again we are going to cast the net a little bit wider to bring them
into the taxation end as well.
We have always believed that a dollar earned is a dollar
taxable. We do not disagree with that basic philosophy. But now
we are finding that a dollar unearned is a dollar taxable. Those
people who deal with investments on a trading basis are now
going to have to pay income tax on the income on the basis that
the shares had already been sold. But they still have them; they
have not sold them. Now they are going to have to pay income
tax as if they had sold them.
Here we have a situation where an investment person who is
managing his money and has it invested and is a trader in
securities is fully invested, is doing well and his shares are going
up and he has not sold any because he feels they are good and
adequate investments. Now he finds that come April 30 he has a
big tax bill, even though he has not received one cent, because
the Minister of Finance wants to cast that net wider to catch
every nickel he can lay his hands on because he is desperate for
cash. While he is desperate for cash, he feels perfectly at liberty
to dip his hands into the pockets of anybody he can find. Never
mind about their cash flow problems; he does not seem to have
any concern about their cash flow problems.
Here is someone who is going to have a tax liability and a debt
to be paid, plus interest if he does not have the cash, because the
shares he is holding and continues to hold have gone up in value.
He has not sold them. He does not have any money. He has not
realized any gains, and yet he has a tax burden. Do you not think
that is stretching it a bit too far? I do.
How are we going to encourage investment if every time
somebody makes a dollar, even before they get the dollar the tax
man has his hand in his pocket saying ``You owe me. You have to
pay it now. I am going to charge you interest and penalties unless
I get it now.''
Mr. Mills (Broadview-Greenwood): What is the solution?
Mr. Williams: The solution is quite obvious: get our fiscal
house in order so that we can manage our own cash flow and let
business and other Canadians manage their cash flow and let
them pay their taxes when they have earned the money.
Remember, I said a dollar earned is a dollar taxable, but I did not
say that a dollar unearned is a dollar taxable. That is a major
quantum leap by this government into a new area of taxation,
which we cannot condone under any circumstances whatsoever.
Not only that, but there is a semblance of offsetting. They are
saying that if your shares go down they will allow you to do it at
market value. If you have a loss and a couple of gains, one up
and one down, you can net them off and pay tax on the
difference.
(1800)
That is okay in an inflationary environment. It is okay during
a period of economic growth because by and large things tend to
go up. This government will be the beneficiary of enhanced
taxation during the good times. We are in an economic growth
11710
period at this time and no doubt that is why the Minister of
Finance introduced this particular piece of legislation.
Think about it this way. We go into an economic downturn,
and we surely will as it has never failed before. I think the
economists would agree that one will come along perhaps
sooner rather than later, much to our misfortune. At that time
after all the securities have been taxed at market value we do
know that the preponderance may be that they will drop in value.
At that time all of them will be asking for tax refunds which will
further erode the government's fiscal position at a time when it
needs the money most.
The government should keep its hands off the taxation of
unearned income. That is the solution. This government should
not get involved in a situation that increases the volatility of tax
collection.
Any business and any government should know that the most
important thing is a steady flow of income. This measure is
going to try to generate additional revenues for the government
in the short term while the economy is good. I can assure you
that on the other side of the coin the chickens will come home to
roost during the economic downturn. That is when this
government will need the money most.
Other little arrangements in the bill are things like funeral
expenses. Most of us do not pay too much attention to funeral
arrangements. Tucked away in Bill C-70 is the opportunity to
put $15,000 cash into a trust fund to pay for funeral expenses on
one's death.
I am sure that the rank and file Canadians have $15,000 in
their pockets and are just running out to put $15,000 into a trust
fund now in order to ensure that they get properly buried when
the time arrives. Not only that, they are going to be able to defer
the taxes on the income.
Unfortunately the average Canadian cannot afford to run out
today and put $15,000 in a trust fund to ensure a proper burial,
but the rich people can. Here is another little giveaway to rich
Canadians by telling them how they can shelter their income.
Just stick $15,000 in a trust fund to ensure that they get a proper
and adequate burial. If we think about that amount and the
interest that is quite a funeral the yuppies are going have on their
demise.
Perhaps I should buy some shares in these funeral home
groups. They have been doing not too badly. I missed out on it
before but maybe it would be a good idea to jump back in.
Maybe they are going to make more money. Maybe $15,000
funerals are going to be the order of the day rather than
something more appropriate for those who have less money. You
never know.
Why in this time of difficulty when the Minister of Finance
says that we need all the money we can get is he allowing rich
people to tuck aside $15,000 plus interest, plus the income so
that they never have to worry about it again? This nice little tax
loophole has popped up from a government that promised to get
rid of them.
The solutions are that we be fair to all Canadians. Surely the
rule has to be that we are fair, that we ensure a small group of
people who have ready access to government members, cabinet
ministers and so on, should not be entitled to some special
privilege which other Canadians do not have.
(1805)
We should be fair to all Canadians. If the average Canadian
cannot afford to put $15,000 into a trust fund for his funeral
arrangements, then I do not think rich people should either. If
they are that rich they can afford a few dollars to get themselves
buried.
There are also the real estate investment trusts. Quite recently
the real estate market in office buildings has not been doing so
well. Too many Canadians were talked into these trust funds. We
ran up the price of office and other buildings in large cities like
Montreal and Toronto with the expectation that these small time
investors were going to make big dollars.
Lo and behold what did we find? Down it went because the
market was oversubscribed. The rich people took the money.
They ran off home and the poor little investor was left with an
empty building. He lost his shirt so they have now made some
changes to the real estate investment trust taxation to allow
these things to be rolled into an RRSP.
Here we are again giving an artificial incentive to Canadians
to buy into real estate. In five or ten years from now when the
market goes down again they will be left holding the bag while
some people will walk home with the cash and I do not think
they will be the small time investors.
During the Easter break, a mortgage free, nine storey office
building in Edmonton was transferred for $1. There were not
enough tenants to pay the taxes. It was losing $250,000 a year.
Read it in the Edmonton Journal. It changed hands for $1. It was
mortgage free. The city tax assessor said it was worth over $2.5
million. For one dollar. If that had been in a real estate
investment trust how much of that dollar would the investors
have received? Nothing.
We must be careful when we provide these tax incentives to
the small and average investors. If we give these artificial
incentives, we create a demand that should not be there. People
jump in, the value goes up. We have heard this story so often. It
is most unfortunate because it is always the small investor who
loses.
There are many rules on the mutual fund reorganization again
to try to help small investors. However, we must be very careful
that we do not provide artificial incentives to these people. If
these investments are lost, we know who they will be pointing
their fingers at. They will want their taxes back. That will be a
11711
further drain on the revenues of this government. That whole
thing leads to volatility.
These are a few concerns I have about the bill. I certainly hope
this government can see the light of day. The job has to be done
as far as balancing the budget, and not these small changes, not
an overhaul the Bloc Quebecois was talking about.
We are talking about a real concerted effort by the government
to recognize that a fiscal crisis requires serious measures to get
the budget balanced. Once that has been done, we do not have to
worry about the pressure of increasing more taxes. We do not
have to worry about the pressure of casting the net wider and
wider to take in more and more people. We can start to live
within our means. When the government feels it can dip into
somebody else's pocket to help its cash flow problem, it makes
the cash flow problem worse for the person who has to pay more
taxes. The government does not seem to think about that.
(1810)
If we are to create jobs we have to create the capital pools in
the hands of the entrepreneurs who feel the money will not be
taken away from them arbitrarily and prematurely with too
much tax. We have to give them the opportunity to make a profit
so they can feel confident to go out and build the factories, sell
the products, hire the people and create the jobs which then
create a whole new number of taxpayers. It is so much better,
easier and fiscally prudent to have taxpayers than tax
consumers.
I know the Liberal government is proposing this but it hired
them in the first place. We should have fewer civil servants
because it reduces the tax consumers. If we can help them to get
into the private sector, perhaps even to start up their own
business, surely that has to be beneficial because now they are
tax producers rather than tax consumers.
This past weekend in my riding I was at a trade fair. I was
talking to a young lady who had been employed in the health
care services and now has her own little business. She is doing
quite well and is quite happy. She is now a tax producer rather
than a tax consumer.
I was also talking to a young entrepreneur, not yet 30, on his
own without any government grant or assistance in any way,
shape or form. He has created a computer program that he is now
selling right across the country to large retailers and so on. If
anyone wants to know about it, it is called ``The Estimator''. It
does a wonderful job of helping companies estimate large
projects. He wants to go international with it as soon as he can
generate the cash flow.
Here is a young entrepreneur with no subsidy, no grant, on his
own, who has developed a product with which he will now be
generating some export revenues. These are the types of people
we must encourage rather than drowning them in another 200
pages of tax rules so incomprehensible that they cannot get their
minds around them. He now has to employ professionals,
lawyers, accountants and so on to figure out how he should be
doing his taxes.
Another item in the bill is the amendment to the way people
may file notices of objections. Large companies now have to
state specifically the areas in which they are objecting
concerning their income tax if it is being reassessed.
On the public accounts committee we were dealing with what
became known as the resource allowance boondoggle; $2 billion
of tax money went down the drain because of this simple little
loophole and an inefficient civil service. To recap, in 1980 the
government and an oil company agreed to disagree on the
assessment of income tax. It said: ``See you in court''. This is a
typical situation. It was nine years later, in 1989, before it went
to court and the government lost, much to its chagrin and much
to its surprise because it thought it had a watertight case. It
wrote the rules and the law and felt it understood them but it lost.
That was okay because it would appeal.
In 1991 the government appealed and lost. It then asked how
much money was involved. Believe it or not, it had never once
figured out how much money was involved. By 1991 it realized
that it was $1 billion. It was astounded. The government had no
idea of the amount of money.
However, that was okay because it was to take it to the
Supreme Court and show everyone who could win. The Supreme
Court said it did not even want to hear about it. That was the end
of the situation but it had one little twist. The last appeal court
which pronounced a judgment on the situation ruled so much in
favour of the oil company that when we asked Revenue Canada
officials: ``How much more money have we lost?'', they said
that it could be another $800 million plus interest. We lost $2
billion because nobody in 1980 asked how much money was at
risk. Not only that, this situation remained wide open for 10
years and 40 other oil companies found out about it and adjusted
their taxes back to 1980 as well.
(1815)
It cost the Canadian taxpayers $2 billion because the civil
service was not up to speed on the situation. With this measure
that loophole has been closed by the Minister of Finance. It was
closed largely because of the work done by the public accounts
committee last year. We do not want to see this happen again. I
do not want to stand up as a parliamentarian who is accountable
to the public to say: ``There goes another billion'', but I have had
to do just that.
11712
The Canada pension plan loses $1 billion every five years.
The people who are responsible for the CPP went to Treasury
Board and asked for a new computer system. They said: ``For
every dollar we spend on a new computer system we will save
$3''. It sounded like a good investment to me, but Treasury
Board said that it did not have the money. Therefore we will lose
$3 and save one.
That is how the government is being run. That is the type of
thing that is going on today. When I tell Canadians about these
fiascos they shake their heads in disbelief that their taxes are
being spent in that fashion. What senior bureaucrat, who is
being paid a large salary, can justify refraining from spending
one dollar if the evidence is there that he is going to save three?
One billion dollars will be lost through overpayments that are
non-recoverable over a five-year period because they do not
have a comprehensive and efficient computer system. That
computer system would originally have cost $250 million. Now
it is up to $340 million. Maybe by the time it is delivered it will
be up to a billion and nothing will be saved. However, the point
is that we are paying these intelligent, knowledgeable and
educated people whose job it is to manage taxpayers' money to
the benefit of Canadians. We are so tied up in rules and
regulations that we cannot make an intelligent decision any
more. We cannot say to the taxpayer that we are running the
country efficiently.
However, we can produce, after a whole year, another 200
pages of incomprehensible law by which Canadians must abide.
That is the problem not only with Bill C-70 but in the way the
government is not attacking the problem. We need responsible
government that is going to balance the budget and get the job
done.
Mr. Dennis J. Mills (Parliamentary Secretary to Minister
of Industry, Lib.): Mr. Speaker, I would like to begin my speech
on the debate by reminding not only members opposite but all
Canadians about our commitment in the red book to the GST.
The hon. member from the Reform Party suggested that we on
this side of the House had forgotten about the commitment
which was made during the last election. It is clearly stated on
page 22 of the red book. I would like to quote a couple of
sentences from it. It reads as follows:
Fairness, simplicity, and harmonization should be key objectives of the tax
policies. But instead of introducing fairness and simplicity into the tax system,
the Conservative government not only imposed the greatest tax increases in
history, but compounded unfairness and complexity by introducing the GST.
The GST has undermined public confidence in the fairness of the tax system.
The GST has lengthened and deepened the recession. It is costly for small
business to administer.
(1820)
We stated that:
In the first session of the new Parliament, a Liberal government will give
the all-party Finance Committee of the House of Commons a 12-month
mandate to consult fully with Canadians and provincial governments and
report on ways to achieve tax fairness. In particular, the committee will be
mandated to report on all options for alternatives to the GST.
I recite those paragraphs from the red book because I am one
member of Parliament who believes passionately that the tax
system must be reformed. I stated in opposition for four years
that the GST was not the way to go, that our current tax system,
both personal and corporate income tax, was complex and
unfair.
My proposal was quite specific. I worked with many chartered
accountants and tax lawyers and we came up with the proposal
of the single tax system. I was happy to see today, after almost
six years of work, that the Globe and Mail has finally
acknowledged that this may, in fact, be a pathway that we should
consider taking.
The point I want to make tonight has to do with the role of the
opposition. When I learned that the Reform Party elected close
to 50 members during the last election, I was pretty excited
about it in the sense that one cornerstone of its campaign during
the last election was comprehensive tax reform.
I can remember the leader of the Reform Party coming to my
city of Pickering, to CFRB, one of our larger radio stations. He
took a whole morning on CFRB to say: ``We must reform the tax
system''. In fact, he went so far as to say that the member for
Broadview-Greenwood was on the right path with the single
tax system. He did acknowledge that the Reform Party system
was called the proportional tax system but he made a
commitment that he would lead his party in the House of
Commons and talk about a constructive alternative to the
current mess. Now a year and a half later very rarely do we hear
the opposition talk about that very specific proposal its
members campaigned on in the last election.
I raise that because I think the nature and the spirit of the
House has to do with constructive debate. It is from that action
and interaction and the agreement and disagreement that we will
eventually come up with a good, comprehensive tax system for
all Canadians.
What did we hear today? We heard some criticism of this
leftover portion of the tax act, part of which we inherited from
the previous government. Not once in the speech of the previous
member did we hear anything about the constructive alternative
that the Reform Party talked about during the last election.
I talk about this with a tone of frustration because we have a
spirit and an approach in this party where we debate vigorously
within. We also welcome the debate that comes to us from across
the floor. On the issue of taxation, the Reform Party has walked
the other way.
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(1825)
Reformers have criticized the existing system but have not
recommitted themselves to the campaign they ran on during the
last election. I believe strongly in this issue and wish the Reform
Party would come back and stir up that tax debate in a much
more vigorous way.
I am concerned about this as well because I now see that in the
United States all the leading Republicans for the presidential
campaign are talking about a single tax system or a flat tax
system. We understand that even some of the leading Democrats
are looking at a total reform of the tax system.
That concerns me because if the United States adopts a single
tax system before we do we will see a flight of capital and human
energy and human capital out of this country that we have never
seen before.
That is why I believe this is one of the essential, one of the
prime debates that we must have in the House. I believe that if
we would lead the way in total tax reform, comprehensive tax
reform from the Chamber, we could also reverse the capital flow
back here.
We all know the real challenge for those of us in government
today is to get a handle on those capital flows. We know and we
talk about the derivative game within all the chartered banks and
major financial institutions. They are moving billions of dollars
all around the world by pushing buttons.
One of the ways we could attract large pools of capital is by
making sure the fundamental tax system is such that it would
attract those large pools of capital. With a system like that where
we would have those large pools of capital, that would put
downward pressure on interest rates.
With that downward pressure on interest rates we would have
capital available to the business men and women who are so
desperately in need today of that capital in order to start their
small or medium size business, grow it and expand it.
That is how we will get the economy going. The instrument
we control in the House that can best manage those capital
flows, that excitement about investment, that possibility for
increased productivity is based in the Income Tax Act.
I listened to the Bloc Quebecois finance critic today taking all
kinds of cheap shots at the fact that we were making little
amendments to the tax act. Why does the Bloc Quebecois not
look at the notion of comprehensive tax reform?
It is interesting. When we presented this idea to the finance
committee a few months ago, the finance critic in the committee
then for the Bloc Quebecois said: ``When we separate this single
tax system is the type of system we will have for Quebec. Why
would we begrudge it for the rest of Canada?''
I wish the opposition parties, rather than taking cheap shots at
minor amendments to the tax act, would get their forces together
and really engage us in a debate on total tax reform.
If we do not have total tax reform in the House in about 25 or
30 months from now I agree with the people who say we will hit
the wall when it comes to our deficit and debt.
The quickest and most constructive way to get out of this is by
dealing with one of the root problems, comprehensive tax
reform.
_____________________________________________
11713
ADJOURNMENT PROCEEDINGS
(1830)
[English]
A motion to adjourn the House under Standing Order 38
deemed to have been moved.
Ms. Marlene Catterall (Ottawa West, Lib.): Mr. Speaker, I
am pleased to have this opportunity to expand on my question of
February 15 to the President of the Treasury Board concerning
contracting in the public service.
Our second budget was a strong signal that we are determined
to constrain government spending. One area that has not been
constrained is contracting.
In the five years before we took office the cost of contracting
rose at twice the rate of the cost of our own personnel; 7.5 per
cent per year, increasing from $2.9 billion to over $5 billion.
Under the previous government we were told these figures were
simply not available. Our government has collected them and
has made them public so they can be scrutinized.
These figures are only part of the story. Public Works and
Government Services Canada reported it contracted $9.4 billion
of goods and services for departments, and this does not include
contracting done directly by the departments. Nor does it
include the hidden costs of contracting: the preparation, the
evaluation and awarding, supervision and exercising of quality
control, the contractors' use of government space and
equipment or the expertise of government employees provided
at no cost, or the lost productivity of employees who spend much
of their professional time dealing with contractors at the
expense of their own professional work.
Since the budget this has become a particularly urgent
question. Our budget projects reducing the size of the public
service by 45,000 positions. We have pledged the utmost
fairness and to reduce involuntary departures to the absolute
minimum. We will pay $1 billion in early departure incentives to
employees.
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Training and out placement early retirement incentives will cost
millions of dollars more.
The real cost in addition to dollars is the horrendous anxiety
for employees, turmoil for the organizations and disruption of
services to Canadians.
It is only fair that every effort be made to retain and retrain
current employees for available work in the public service. We
cannot justify continuing and expanding the use of outside
sources to do work that could be done by an employee who
would otherwise become another one of the 1.5 million
unemployed.
Contracting is an essential tool for good management to meet
temporary requirements for peak periods of activity, for one
time projects, for specialized skills temporarily required, to
provide government services or programs at reduced costs.
However, Parliament has no assurance that contracting is being
used only where it is cost effective and appropriate. Nearly half
the contracting is done with no competition. In one year 17,000
contracts were awarded to single suppliers without a
competitive bid.
In many cases contractors are working side by side with
government employees doing the same work but for
substantially higher fees. While employees are subject to a
rigorous merit process to ensure the best qualified are
appointed, contractors face no such screening.
There is concern about employees who have been
compensated to leave the public service and then return often
within days on contract either as individuals or through a
company, sometimes while continuing to receive a government
pension. This double dipping must be controlled.
I urge the President of the Treasury Board to accept the
recommendation of the auditor general to require all
departments to account in next year's estimates for full time
equivalent personnel on contract. Only then will Parliament
know whether the sacrifices being imposed on government
employees are not rendered pointless by a growing shadow
public service of contractors. I ask him to ensure in the short
term that we are not taking jobs, income and hope from people
only to have someone else take over their work and income
through the back door.
We have people's lives in our hands, their future, their
families, their homes, their careers, their children's education,
their prospects for a decent standard of living in their old age.
That is a serious responsibility and I believe constraining
contracting is one important element of carrying out that
responsibility responsibly.
[Translation]
Mr. Ronald J. Duhamel (Parliamentary Secretary to
President of the Treasury Board, Lib.): Mr. Speaker, as you
know, one of the main responsibilities of the government is to
use taxpayers' money in the best possible manner. When it
makes decisions regarding contracts, the government seeks to
get the best possible value for taxpayers' money and relies on
good management.
[English]
While the government is concerned about taxpayers' money,
it is also conscious of the fact that it is a major employer. As
such, it must also be concerned about its employees. We are
facing a smaller public service and this will translate into
difficult times for many of our employees.
We need only read the newspapers to realize the extent to
which the President of the Treasury Board is concerned with
employee well-being. He has been meeting with union officials
and has said on a number of occasions the government wants to
treat public servants fairly and humanely during the period of
downsizing.
This means, among other things, living up to our commitment
to find alternative employment for as many affected
indeterminate employees as possible. In this regard the Treasury
Board expects public service departments to examine their
contracts for services as well as other internal employment
opportunities with a view to offering these opportunities to
affected employees. There are currently staffing controls in
place in the public service.
The Treasury Board secretariat in consultation with
departments and central agencies has been re-examining human
resources management and employment practices to identify
what new or modified measures should now be adopted.
Again, our goal is to make the best efforts we can to
reintegrate affected employees. Increased emphasis is being
given to this very activity.
The President of the Treasury Board has asked the Standing
Committee on Government Operations to review government
contracting services. The committee held extensive hearings
during the fall. It continues to do so and is coming quite close to
the completion of its task. It will be submitting a report, which
government awaits with great interest.
We will still need to contract out for services. There are
fluctuations in workloads, for example, during the taxation
period. There is a need for specialized services for fleet
management of government vehicles. There is contracting for
services during emergencies. If a boat is caught on a reef when
no government coast guard boat is available we would need to
ask someone for help.
[Translation]
I believe this approach in the management of government
affairs is truly fair, both for federal employees and Canadian
taxpayers.
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[English]
The Deputy Speaker: Pursuant to Standing Order 38, the
motion to adjourn the House is now deemed to have been
adopted. Accordingly, the House stands adjourned until
tomorrow at 10 a.m., pursuant to Standing Order 24(1).
(The House adjourned at 6.37 p.m.)