CONTENTS
Monday, May 27, 1996
Motion for concurrence in Senate amendments 2973
Mr. Breitkreuz (Yorkton-Melville) 2973
Bill C-31. Motion for concurrence 2981
Mr. Martin (LaSalle-Émard) 2981
Motion for third reading 2982
Division on motion deferred 2993
Bill C-36. Motion for second reading 2993
Mr. Martin (LaSalle-Émard) 2993
Mr. White (North Vancouver) 2998
Mr. Axworthy (Saskatoon-Clark's Crossing) 2999
Mrs. Gagnon (Québec) 3000
Mr. Martin (LaSalle-Émard) 3003
Mr. Martin (LaSalle-Émard) 3003
Mr. Martin (LaSalle-Émard) 3004
Mr. Martin (LaSalle-Émard) 3004
Mr. Martin (LaSalle-Émard) 3004
Mrs. Tremblay (Rimouski-Témiscouata) 3008
Mr. Axworthy (Winnipeg South Centre) 3008
Mrs. Tremblay (Rimouski-Témiscouata) 3009
Mr. Axworthy (Winnipeg South Centre) 3009
Mr. Mills (Red Deer) 3009
Mr. Axworthy (Winnipeg South Centre) 3009
Mr. Mills (Red Deer) 3009
Mr. Axworthy (Winnipeg South Centre) 3009
Mr. Axworthy (Saskatoon-Clark's Crossing) 3009
Mr. Martin (LaSalle-Émard) 3010
Mr. White (Fraser Valley West) 3013
Mr. White (Fraser Valley West) 3013
Mr. Breitkreuz (Yorkton-Melville) 3013
Bill C-36. Consideration resumed of motion forsecond reading 3015
Mr. White (North Vancouver) 3017
Division on motion deferred 3027
Bill C-4. Motion for second reading 3027
Mr. Axworthy (Winnipeg South Centre) 3027
(Motion agreed to, bill read the second time and referredto a
committee.) 3030
Bill C-5. Motion for second reading 3030
Division on motion deferred 3037
(The sitting of the House was suspended at 5.52 p.m.) 3037
The House resumed at 6.30 p.m. 3037
Bill C-20. Consideration resumed of report stage 3037
Motion negatived on division: Yeas, 26; Nays, 143. 3037
Motions Nos. 4 and 15 negatived. 3038
Motion agreed to on division: Yeas, 119; Nays, 50. 3038
Motion for concurrence 3039
Motion agreed to on division: Yeas, 143; Nays, 26 3039
Bill C-31. Consideration resumed of third reading 3040
Motion agreed to on division: Yeas, 115; Nays, 54 3040
(Motion agreed to, bill read the third time and passed.) 3041
Bill C-36 Consideration resumed of motion 3041
Motion agreed to on division: Yeas, 114; Nays, 54. 3042
(Motion agreed to, bill read the second time and referredto a
committee.) 3043
Bill C-5 Consideration resumed of motion for secondreading 3043
(Motion agreed to, bill read the second time and referredto a
committee.) 3043
2973
HOUSE OF COMMONS
Monday, May 27, 1996
The House met at 11 a.m.
_______________
Prayers
_______________
PRIVATE MEMBERS' BUSINESS
[
Translation]
Mr. Don Boudria (Glengarry-Prescott-Russell, Lib.): Mr.
Speaker, I believe that there is unanimous consent for the following
motion. I move:
That a message be sent to the Senate to acquaint it that this House agrees with
the amendments made by the Senate to Bill C-275, an act establishing the
Canadian Association of Former Parliamentarians.
(Motion agreed to.)
* * *
[
English]
Mr. Garry Breitkreuz (Yorkton-Melville, Ref.) moved:
That, in the opinion of this House, the government should enact legislation
which would require that a binding, national referendum be held at the time of
the next election to ask Canadians whether or not they are in favour of federal
government funding for abortions on demand.
He said: Mr. Speaker, Motion No. 91 is not just about abortion. It
is about democracy. It is about giving voters a real say in how they
want their scarce health care dollars spent. It is about voters
deciding which health care procedures they consider essential. It is
about voters making these tough decisions for themselves, not
having politicians and bureaucrats make these decisions for them.
We are debating whether voters have the right to direct federal
government health care funding to medical procedures they think
are most essential and of the highest priority. We are debating
whether Parliament should decide for the people or whether the
people have the right to decide for themselves.
Throughout my speech today I will pose key questions that need
to be answered in relation to this debate. Then I will proceed to
answer each one.
First, where do the people stand on tax funded abortions? In the
1991 provincial election in Saskatchewan two-thirds of the voters
in a plebiscite voted to deinsure funding for abortions. A January
1995 poll conducted in Alberta produced similar results, with 73
per cent of women and 69 per cent of men opting for defunding of
abortions. In November 1995 an Environics Focus Ontario survey
found that 57 per cent of respondents do not think the Ontario
health insurance plan should pay for abortions.
As of this morning in the short time available since my motion
was presented to the House, I have received 109 petitions with
2,790 signatures supporting my Motion No. 91. I will start tabling
these petitions in the House later today. Many other MPs have also
received petitions from people objecting to their money being
spent on medically unnecessary abortions.
Next, how much do abortions cost Canadian taxpayers? A 1995
Library of Parliament research paper found that approximately
100,000 therapeutic abortions are performed each year in Canada.
About 70,000 abortions are performed in hospitals at a cost of
about $500 each, a total cost of $35 million per year. Another
30,000 abortions are performed in free standing clinics at a cost of
about $250 each, totalling about $7.5 million a year. Physician fees
were calculated in the 1992-93 fiscal year to be $9.1 million. The
cost is quite substantial.
Next, is abortion only a provincial issue? I disagree with those
who say this is a matter for the provinces to decide. As long as the
federal government is paying part of the provinces' medicare bills,
federal politicians have a responsibility to ensure that scarce
taxpayer dollars are being spent on medical procedures that voters
think are the highest priority.
In April 1994 Terese Ferri, barrister and solicitor and a member
of the Ontario Bar, wrote a paper titled ``Legal Issues Concerning
the Public Funding of Abortions in Alberta and Canada''. Ms. Ferri
wrote:
It is well established that, while the federal government has jurisdiction to
make federal funds for health care contingent upon adherence to national
standards, legislation on matters concerning the provision of health care is
entirely within the domain of the provinces.
2974
(1110)
From my review of legal briefs on this issue, I conclude that the
federal government has the power to set national standards and
provide federal funding in accordance with these standards. It is
clearly within the power of the federal government to say which
medical procedures it will fund and which it will not.
Performing abortions is a provincial jurisdiction. Paying for
abortions is a decision for both federal and provincial governments
to make independent of one another because they each pay a
portion of the costs.
The Reform Party is on record saying we want to define core
services which are covered by medicare. Is this a decision best left
to politicians and bureaucrats or to the people? I say it is the people
who should decide, which is what would happen if Motion No. 91
were passed by Parliament today.
Next, what does the Canada Health Act say? In the legal analysis
mentioned previously lawyer Terese Ferri wrote:
Under the Canada Health Act, federal funds are available to provincial health
care plans which, among other things, are comprehensive, universally available
and accessible. The plan must insure all insured health services provided by
hospitals and medical practitioners, section 7. Hospital services are defined as
``services preventing disease or diagnosing or treating an injury, illness or
disability''. Physician services are defined as ``medically required services
rendered by medical practitioners'', section 2.
Section 3 of the Canada Health Act states that the primary objective of a
Canadian health care policy is to protect, promote and restore the physical and
mental well-being of residents of Canada.
Unfortunately the Canada Health Act does not include a list of
medical procedures or services which the federal government
thinks are services preventing disease or diagnosing, treating an
injury, illness or disability, or a list of medically required services.
I think it is about time the federal government start defining
which hospital services and physician services are medically
necessary.
Reformers have referred to this list of medically necessary
services as core services which should be supported by federal tax
dollars.
If it can be proven that a medical procedure or service does not
protect, promote and restore physical and mental well-being, that
the service does not prevent disease, is not an illness and is not
medically required, then this should be sufficient reason to deny
federal tax funding for such a procedure. Is that not right?
Further, if it can be proven that abortions actually jeopardize the
health and well-being of the patient, the federal government has a
duty to withdraw tax funding for this procedure because it violates
the purpose of the Canada Health Act as stated in section 3. Terese
Ferri's legal analysis concluded that it would be legitimate for the
federal government to disqualify from funding those provinces
which do insure such services.
That logically leads to the next question. Is abortion medically
necessary? Induced abortion as interpreted by the Canadian
Medical Association is the active termination of a pregnancy
before fetal viability. Viability is considered to be the ability of the
fetus to survive independently outside the womb. A fetus is
considered viable in Canada after 20 weeks of gestation and/or the
fetus weighs 500 grams at birth.
A non-therapeutic abortion is an interruption of a pregnancy for
non-medical reasons by any means. A therapeutic abortion is an
interruption of pregnancy for legally acceptable medically
approved indications. Therapeutic is defined as curative, dealing
with healing and, especially, remedies for diseases. I find it hard to
believe that anyone can consider most abortions to be the curing or
healing of an illness or that a normal pregnancy is considered a
disease.
(1115)
Dr. R.M. Ferri, in a 1994 psychiatric brief, reported a 1983 study
of abortion practices in a typical Ontario hospital which revealed
that 98.5 per cent of the 704 abortions performed that year were for
mental health reasons. To show that this 1983 study is false let me
report on another study.
The family planning division of Health and Welfare Canada
conducted a study of 554 women who received abortions in
Canadian hospitals. Here are the responses to the question: ``What
is your main reason for your decision to have an abortion?'' Two
hundred and eleven of the 554 women, or 38 per cent, did not want
children at this time, did not want children at all or said their family
size was complete. One hundred and one of them, or 18 per cent,
said they could not afford a child or that they did not have the
money to move to larger accommodations. Ninety-seven, or 17 per
cent, said they were too old or too young to have a child, that they
were afraid the child would be abnormal or they feared the
pregnancy would pose a risk to their health. Sixty-nine, or 12 per
cent, said they were not married, did not want their friends to find
out about the pregnancy, that the child was not their partner's, that
the partner did not want a child or believed the pregnancy
threatened their mental health. Seventy-six, or 14 per cent, said
they were alone, did not want to raise a child, would have to quit
school or a job, or that it would interfere with their career plans.
These responses demonstrate that most women seeking
abortions do so for reasons other than treatment for medical or
mental health problems.
Dr. Ferri concluded from his literature review that, first, abortion
is not a verifiable remedy which significantly improves the health
of a patient; second, the safety, efficacy and validity of abortion for
mental health reasons has not been proven; third, abortions
2975
performed for psychiatric reasons worsen a woman's mental
health; fourth, abortion is not therapeutic and is actually harmful to
women's mental health; and fifth, funding by the government
under a health care plan cannot be justified.
In 1989 The Psychiatric Journal of the University of Ottawa,
Volume 14, No. 4, published a major Canadian survey of studies on
abortion for mental and emotional health reasons. The study survey
was conducted by Dr. Philip Ney, the psychiatric director of the
adolescent unit of the Queen Alexandria Hospital in Victoria, B.C.
The study concluded that, first, there is no satisfactory evidence
that abortion improves the psychological state. Second, mental ill
health has been shown to be worsened by abortion. Third, recent
studies are turning up an alarming rate of post-abortion
complications. Fourth, the emotional impact of these
complications needs to be studied. These are important
considerations which we cannot ignore.
The committee to end tax funded abortions concluded in its
January 1995 report that abortion is a procedure that disrupts the
normal physiologic process and carries a physical risk to the
woman undergoing the procedure. In spite of the fact that over 23
million abortions have been performed in North America in the last
25 years there are no good medical studies demonstrating the
therapeutic benefit to women on physical, psychiatric or
psychological grounds. The procedure, therefore, has no proven
medical benefit and cannot be justified as medically necessary in
any context other than political. My own review of available
research leads me to the same conclusion.
I do not have time today to touch on some of the other health
related concerns which abortion raises, for example, the evidence
that is mounting that abortion raises a woman's risk for getting
breast cancer, a study that needs to be done more thoroughly.
(1120 )
Would ending tax funded abortions violate the charter of rights
and freedoms? In preparing for this debate I reviewed three
independent legal opinions on the question. Would non-payment of
abortion procedures violate the rights guaranteed by sections 7 and
15 of the charter of rights and freedoms?
First, in his November 1994 analysis Frank de Walle of the firm
de Walle and McDonald concluded that refusal to fund abortions
did not restrict access, did not discriminate and did not place any
government obstacle in the path of a woman choosing to terminate
her pregnancy.
He added that the government is not obliged to finance rights and
used this analogy to prove his point. A right to freedom of
expression does not entitle one to demand the government pay for
press coverage. Just because you have freedom of speech does not
demand that you have the right to demand others pay for the
expression of that.
In May 1994 Darren Richards of the law firm Snyder &
Company arrived at similar conclusions. He said that the
de-insuring of abortion procedures may not be found to violate
section 15(1) of the charter. His legal analysis concluded if the
courts found such an action to be discriminatory that the
de-insuring of medically unnecessary abortion procedures could
qualify as a reasonable limitation of rights pursuant to section 1 of
the charter.
Mr. Richards also reviewed section 7 of the charter which
protects everyone's right to life, liberty and security of the person.
He concluded that the non-funding of abortion does not place any
government obstacle in the path of a woman choosing to terminate
her pregnancy and therefore her to life, liberty and security of the
person is not violated.
The third study I would quote is from Terese Ferri, barrister and
solicitor in the province of Ontario who concluded that
de-insurance of abortion would not infringe on the rights
guaranteed under the Canadian Charter of Rights and Freedoms.
What does the Criminal Code of Canada say about abortion?
Section 287 of the Criminal Code made abortions illegal except
when completed by a qualified medical practitioner in an
accredited or approved hospital. It was struck down in 1988 by the
Supreme Court because it violated section 7 of the charter of rights.
It is still a criminal offence under section 290 to supply a drug or
instruments to be used to cause a miscarriage.
Section 223 of the Criminal Code establishes the point at which a
child becomes a human being for the purpose of determining if a
homicide has been committed. This section defines that a child is a
human being if it has completely proceeded from its mother in a
living state and provides that a homicide is committed if a child
dies after meeting the definition of a human being.
Therefore any abortion completed before the baby has
completely proceeded from its mother's womb is not murder.
While late term abortions are not common, I find it unconscionable
that the Criminal Code does not prohibit them, but this is a matter
for another private member's bill.
I was at a meeting last year at which the speaker was a woman in
her late teens. She related some of her objections to abortion. She
had survived the abortion procedure. This in itself may not sound
too remarkable unless I go on to explain that she was the unborn
child that was aborted. We need to change our Criminal Code
definition of murder.
In conclusion, Motion M-91 raises several fundamental
questions. First, do the people of Canada have the right to a direct
say in how the government spends their money? This is a question
of democracy and the right of people to have input. Second,
abortion is not a medically necessary procedure in most instances
and scarce
2976
health dollars should not be spent on it. Third, approval of my
motion does not contravene the rights of anyone.
It is wrong for a government to avoid talking about sensitive
issues. The essence of what we do in the House of Commons
should be to fully debate all issues of concern to the Canadian
people. The job of government is to carry out the will of the people.
If we cannot decide the issue here it should be referred to the
people of Canada and not simply avoided. I therefore make this
request. I seek the unanimous consent of the House to have my
motion declared votable.
(1125)
The Deputy Speaker: Is there unanimous consent to permit this
to be a votable item?
Some hon. members: No.
Ms. Shaughnessy Cohen (Windsor-St. Clair, Lib.): Mr.
Speaker, I am rising to speak on Motion No. 91 concerning federal
funding support for abortion services on demand. I want to address
the role of the federal government vis-à-vis the Canada Health Act
with respect to determining insured health services.
As one of our greatest national projects, Canada's health care
system is a defining element of Canadian society. Medicare has
contributed to a quality of life that is recognized to be one of the
best in the world. It also gives us a comparative advantage in the
global marketplace.
I am happy to say, as I usually do, that the riding of
Windsor-St. Clair and my community of Windsor had a great deal
to do with that, starting with early insurance plans like Windsor
medical and with the great vision of the Right Hon. Paul Martin, Sr.
The health care system represents the best of the Canadian spirit,
reminding us of the good that we can achieve together. Medicare
was introduced and developed by a succession of Liberal
governments, providing a tangible example of the commitment of
the Liberals to compassionate public policy.
The Liberal Party and the government remain firmly committed
to the five fundamental principles of medicare as set out in the
Canada Health Act: public administration, comprehensiveness,
universality, portability, accessibility.
The one principle which I particularly want to focus on is
comprehensiveness. At its most basic, comprehensiveness requires
that provincial health care insurance plans cover all medically
necessary services performed by doctors or in hospitals. The term
medical necessity is a key concept. It is an integral part of the
understanding and operation of the act. The term medically
necessary is used in the Canada Health Act in conjunction with
other conditions to assure Canadians that once a decision has been
made that a service is medically necessary, then access becomes
universal and on uniform terms and conditions.
In my view this debate is not just about abortion. This motion
has much broader consequences than that. It is about which
government is going to decide that any medical procedures are
necessary. It is about whether our aging parents will have access to
oxygen when their respiratory systems fail. It is about whether
children and adults with disabilities will get the specialized support
they need. It is about whether our constituents will have universal
access to any medically necessary procedure.
Since the beginning of federal support for health care in 1957
through the hospital insurance and diagnostic services act,
decisions regarding what is medically necessary have been left to
the provinces to determine. This is consistent with the provisions of
the Constitution. It makes sense because after all the provinces
manage the health care system. The government does not do that
and the man or the woman on the street does not do that.
The provinces work with the appropriate medical experts. They
are delivering the service, they are closer to the patients. This
means that decisions regarding medically necessary insured health
services are up to the provinces and their medical associations or
those whom they consult to decide.
I might add that there is a remarkable degree of congruence and
consistency among all provinces and territories on this front. On
the matter of health insurance coverage for services all provinces
and territories, particularly for abortion services, have regarded
them as medically necessary services and insure them on this basis.
I emphasize that there is almost no service that is not medically
necessary in some cases. These determinations have been made
based on the context of the service being provided.
The government firmly believes that it is not for Ottawa to say
that this procedure or that procedure must be covered. This
responsibility is better left to the provinces and physicians who
deliver services on a daily basis and who are aware of the
circumstances under which they are delivered.
This approach stands in sharp contrast to what is happening in
the United States where insurance companies are telling more and
more physicians what they will cover, what they can or cannot do
for their patients and even how to do it.
The Canada Health Act permits the determination of medical
necessity at the point of delivery of the service. This approach is
superior to developing a list of insured health services. Lists are
simplistic and rigid. They result in some services being insured and
others not being insured in all circumstances. They also invite a
steady move to privatization especially if more and more services
2977
are covered by private insurance because the government is out of
them because it is not on the list.
(1130)
Determining medical necessity at point of service is one of the
greatest strengths of the Canada Health Act. This approach allows
circumstances to vary from service to service. It is an approach that
recognizes the medical condition of the patient. It is an approach
that ensures Canadians receive services on the basis of need, not on
the basis of ability to pay.
Since the beginning of medicare, medically necessary services
have been made available without point of service charges. I cannot
deny that fiscal realities have forced us to make some tough
decisions regarding our health care system. There is still room to
make our health care system more efficient.
Putting our universal and comprehensive health care system in
place took commitment. Facing the challenges and finding
solutions to problems which arose over the years took
commitment. That commitment is still here today. It is a
commitment that Canadians want and one that this government
takes seriously.
We will ensure that Canadians continue to receive medically
necessary services on the basis of need and not on the basis of their
ability to pay. Access to services is based solely on the medical
needs of the patient. Medical necessity, not how much money one
has, should dictate access to medical services. Canadians expect
that they will have medically necessary services available without
point of service charges.
The federal government has an important role to play in ensuring
that Canadians receive the care they need. What we can and will
continue to do is to interpret the Canada Health Act as requiring
coverage of all medically necessary services.
Our national health insurance system is close to the hearts of
Canadians. It is something too precious to tamper with on a
piecemeal basis. This is why the federal government cannot
support this private member's motion. Supporting this motion
could jeopardize the principles of the Canada Health Act. It could
jeopardize the constitutional authority of the federal government
and the provincial governments. More important, it could
jeopardize the health of Canadians.
[Translation]
Mrs. Pauline Picard (Drummond, BQ): Mr. Speaker, I am
pleased to participate in today's debate on Motion M-91 put
forward by my colleague from Yorkton-Melville.
Abortion has long been a matter of concern to the people of
Quebec and Canada. It is a very sensitive issue that brings into play
profound and very different convictions on individual rights, social
responsibility and moral standards. It also raises questions on the
place of women in our society. For all these reasons, abortion
could easily become a divisive issue.
This, however, does not mean that the issue of abortion must be
ignored. Unfortunately, too many governments, lacking the
courage or the political will to take their responsibilities in
sensitive matters, go for the easy way out and bury their heads in
the sand.
At that level, the motion put forward by my colleague from
Yorkton-Melville at least has the merit of trying to move the issue
forward. The motion reads as follows: That, in the opinion of this
House, the government should enact legislation which would
require that a binding, national referendum be held at the time of
the next election to ask Canadians whether or not they are in favour
of federal government funding for abortions on demand.
The idea of asking Canadians to settle the matter is quite
democratic and may seem interesting at first sight. It would be nice
to see the Liberal government be as democratic toward the men and
women of Quebec who want to make Quebec a sovereign country.
These people will undoubtedly remind them of this in the next
election.
To get back to Motion M-91, one must go beyond mere
appearances and wonder whether a referendum is really the best
way to settle this matter. After thinking about this and reading the
documentation available, I can only conclude that a referendum is
not the way to go, for several reasons.
(1135)
First of all, there is a vast consensus within the public in favour
of free choice; that is a well known fact. An Environics poll dated
June 29, 1992, indicated that 79 per cent of Canadians agreed that
the decision to abort is one that should be made by each woman, in
consultation with her doctor. In Quebec, 80 per cent of respondents
also agreed with this statement. Considering that, every year, more
and more people support freedom of choice, we have every reason
to believe that these numbers are at least as high, if not higher,
today.
I therefore think that holding a referendum on this issue is
unnecessary. It is up to us, as elected members, to act accordingly.
The public is not the only one in favour of free choice. Year after
year, decision after decision, the courts reaffirm the legality of
abortion. An often used argument concerns the rights of the mother
to be. On August 8, 1989, the Supreme Court ruled that no
presumed rights of the foetus or the father existed or should take
precedence over a woman's right to decide what happens to her
own body.
This kind of thinking on the part of the courts is observed
worldwide. In the United States, in England or wherever, it is
2978
becoming increasingly obvious that the only arguments against
abortion that may hold up are moral in nature.
The motion before us today also raises a totally different issue,
concerning jurisdiction over matters of abortion. Under section
92(7) of the Constitution Act, 1867, the establishment,
maintenance and managements of health care institutions come
under exclusive provincial jurisdiction. We can never stress this
point enough. In addition, the courts have vested in provincial
legislatures extensive jurisdiction over public health matters of a
merely local or private nature, in accordance with section 92(16).
Regulatory control of all professions, and health care professions
in particular, also fall under the provinces' jurisdiction over
property and civil rights, in accordance with section 92(13) of the
aforementioned act.
For these reasons, which leave no doubt as to the fact that
Quebec and the other provinces have jurisdiction over health, the
federal court of appeal ruled, in 1983, that the general issue of
abortion comes under the exclusive jurisdiction of provincial
authorities.
Therefore, we wonder why it should be necessary to ask
Canadians whether or not they are in favour of federal government
funding for abortions, as proposed in the motion moved by the hon.
member for Yorkton-Melville.
Let us be clear: health comes under provincial jurisdiction. It is
only because it acted in a roundabout way that the federal
government managed to get involved in this sector, thanks to its
spending power. Of course, eligibility for federal funding depended
on certain conditions being met. We all know the story very well.
Upon reading the motion moved by the hon. member for
Yorkton-Melville, one also wonders about the appropriateness of
holding a referendum at the same time as a general election. The
themes, the stakes and the whole dynamic surrounding an election
are many and varied, and are not necessarily given the same
weight.
Imagine for a moment that the motion is passed, that the
government enacts a law, and that a referendum is held in Canada
and in Quebec on federal funding for abortions. What do we do
with the results? How do we interpret them?
For example, if a majority is in favour of federal funding for
abortions, which conditions should apply? Who can perform these
abortions? Where? When? How? For what reasons can a woman
get an abortion? Who ultimately makes the decision? All these
questions remain unanswered because the current wording of
Motion M-91 only deals with the financial issue.
By contrast, if a majority opposes federal funding, does it mean
these people are opposed to abortion? Not necessarily. People may
be in favour of abortion, but opposed to its funding.
(1140)
In conclusion, the motion before us raises more questions than it
answers. Given the costs of a referendum, we seriously wonder
about the appropriateness of the wording of Motion M-91, not to
mention that we would first have to ask the Prime Minister to tell
us which percentage, in his opinion, would be required, since he
seems to be in the process of redefining democracy.
The issue of abortion is much too important for women and for
society in general to be treated as a mere funding issue, particularly
through a referendum to be held at the same time as a federal
election. For all these reasons, and for other ones, I cannot support
Motion M-91.
[English]
Mr. Leon E. Benoit (Vegreville, Ref.): Mr. Speaker, I am
pleased to take part in the debate on the motion presented by the
hon. member for Yorkton-Melville which reads:
That, in the opinion of this House, the government should enact legislation
which would require that a binding, national referendum be held at the time of
the next election to ask Canadians whether or not they are in favour of federal
government funding for abortions on demand.
I will generally debate the basis of what services our public
health care system should be required to pay for. I will also speak
on the issue of allowing Canadians to decide how their tax dollars
should be spent.
This is a federal and provincial issue. The federal government
has the power to set national standards for health care and provide
federal funding in accordance with these standards. It is clearly
within the power of the federal government to say which medical
procedures it will or will not fund. Performing abortions is a
provincial jurisdiction. Paying for abortions is a decision that
provincial and federal governments make independent of one
another because they each pay a portion of the costs.
As an aside I will talk about the federal government portion
relative to that of the provincial government. When the Canada
Health Act was set up, funding for health care was 50:50. Now
approximately 22 per cent is paid by the federal government and
the rest by the provincial government. By the time the recent
budget of the finance minister is implemented, the federal portion
of funding will be reduced to approximately 17 per cent. It is an
ever decreasing amount.
Getting back to the motion, it really does not matter which
government is involved, in the end the same taxpayers are paying.
One would think that federal and provincial governments would
target spending of taxpayers' money based on the good it will do or
the need for the service. In this case where health care spending is
involved the main consideration should be the impact of making
people healthier or preventing disease or injury.
2979
How are decisions regarding health care set out in the Canada
Health Act? The Canada Health Act requires the provinces to
provide and pay for medically necessary procedures. In most cases
abortion is not medically necessary. It is a service which does not
make people healthier or prevent injury or disease. In fact, it does
the opposite. It disrupts a normal physiological process and poses
a risk to the woman undergoing the procedure.
Surveys demonstrate that the vast majority of women seeking
abortions do so for reasons other than the treatment of a medical or
mental health problem. The member who proposed the motion has
already mentioned a study by Health Canada which I believe is
well worth repeating.
(1145)
It was a study of 554 women who received abortions in Canadian
hospitals. Here are the responses given to the question ``what is
your main reason for the decision to have an abortion''.
Thirty-eight per cent said they did not want children at this time,
did not want children at all or that their family size was complete.
Eighteen per cent said they could not afford a child or that they did
not have money to move to larger accommodations.
Eighteen per cent said they were too old or too young to have a
child, that they were afraid the child would be abnormal or they
feared that pregnancy would pose a risk to their health. Twelve per
cent said they were not married, did not want their friends to find
out about the pregnancy, that the child was not their partner's, that
the partner did not want a child, or that they believed the pregnancy
threatened their mental health. Fourteen per cent said they were
alone and did not want to raise a child, would have to quit school or
a job, or that it would interfere with their career plans.
Even abortion providers admit abortions are generally not
medically necessary. For example, Henry Morgentaler told a
Vancouver radio audience in 1988 that fewer than one-tenth of one
per cent of abortions are necessary to save the woman's life.
Irvin Cushner of Planned Parenthood Federation of America
testified before a Senate hearing that more than 98 per cent of
abortions are done for non-medical reasons.
Notice that none of these studies was done by pro life groups or
was even commissioned by pro life groups. It is exactly the
opposite.
Through two decades of widespread abortion experience,
doctors have increasingly described it as a surgery that carries risks
to the woman's fertility, risks of chronic pelvic pain, breast cancer
and in subsequent pregnancies premature labour or miscarriage.
Studies show that even abortions performed for psychiatric reasons
worsen women's mental health.
Motion No. 91 is not just about the funding of abortion. It is also
about democracy. Politics has clearly become increasingly further
removed from the people. This clearly shows a need to give voters
a real say in how they want their scarce health care dollars spent.
Decisions regarding important social issues should be made by
voters, not politicians and bureaucrats. The Reform Party is clear in
its policy. It was presented during the last election campaign and it
will be presented in the next election campaign. The Reform Party
clearly says the role of a politician is first to tell their constituents
during an election campaign what their view is on an issue such as
this, providing public funding for abortion, of which I am not in
favour.
We should hold a national referendum. That is exactly what this
motion requests. It would give the public a direct say rather than
leaving the issue in the hands of politicians and, in many cases, in
the hands of bureaucrats. This will give people a direct say.
Barring a referendum, the opportunity for people to vote
directly, Reform MPs are committed to ensuring public debate
takes place across the country. Reform MPs will ensure the media
is involved in these discussions. The media plays a very important
role in the debate. Through some formal mechanism such as a
public poll or a householder survey we will determine the will of
the majority of constituents. In all cases Reform MPs will vote with
the majority view in their constituencies.
(1150)
Old style politics and the style of politics being done in the
House by the governing party are anything but democratic. What
the government feels is a free vote is really, rather than MPs voting
the will of their constituents, voting their own consciences in most
cases.
I seek the unanimous consent of the House to have this motion
referred to the Standing Committee on Health.
The Deputy Speaker: Is there unanimous consent to have the
motion referred to the standing committee?
An hon. member: No.
Mr. Gordon Kirkby (Parliamentary Secretary to Minister of
Justice and Attorney General of Canada, Lib.): Mr. Speaker,
this motion shows a misunderstanding of the process by which
medical services are determined for funding. It assumes the federal
government plays an active role in this determination. This
assumption runs contrary to the spirit and the letter of the Canada
Health Act.
This act respects the role of the provinces in the delivery of
health services and recognizes that provincial health care systems
must address the unique needs and circumstances of each province.
2980
This allows each province and territory latitude to make
necessary decisions. This also gives provinces and territories
latitude in the application of the five Canada Health Act principles
and the ability to make decisions consistent with their own
priorities and capacities.
In January 1988 the Supreme Court of Canada, interpreting the
charter of rights and freedoms, struck down the Criminal Code
provisions involving therapeutic abortion committees. This
removed all administrative apparatus associated with this
procedure.
This decision invalidated the entire legislative scheme for
limiting women's access to abortion, leaving the matter of abortion
to be decided by women in consultation with their doctors.
The Canada Health Act requires that medically necessary
hospital and physician services are insured. The operation of
provincial health insurance plans and the delivery of health
services to residents are within the purview and decision making
power of the provinces and territories. In short, the provinces and
their doctors will decide whether services are medically necessary.
Provinces are then responsible for insuring and delivering these
services to residents.
As a statement of federal policy, the Canada Health Act respects
that the provinces must have flexibility in deciding how to best
organize, finance and deliver health services. The federal criteria
provide the framework, but it is the provinces and the territories
that are responsible for these basic decisions.
This division of relative roles and responsibilities has given us
the excellent health care system we have today. It is certainly one
of the reasons the Canada Health Act received unanimous approval
in the House of Commons in 1984.
The federal government's role in health financing has been
instrumental in shaping our health care system while providing the
provinces with the scope necessary for determining how best to
allocate federal transfers to address the health needs of their
populations.
It is important to consider what provincial flexibility really
means in terms of the Canada Health Act. The provinces are
responsible for deciding in partnership with their health
professionals which services are medically necessary and which
should appear on the list of insured services.
Each province receives its advice from licensing bodies as well
as medical associations on a scientific and professional basis for
these decisions. Each province has its own consultative
mechanism. On the basis of such considerations, the various
services have been determined to be medically necessary and
therefore are insured in every province and territory in Canada.
(1155)
The challenge that continues to face us is the prevention of
unwanted pregnancies. We know the reasons women seek abortion
include lack of information about or access to birth control
measures or sex education. These can be addressed through
research, education, counselling and other forms of assistance
through organizations which provide information and support.
One of our goals must be to secure for Canadians the widest
possible range of choices about whether and when to have children.
Unintended pregnancy is a particularly troubling and frustrating
issue since it is largely avoidable. Despite recent advances in
education and accessibility of contraception, unintended pregnancy
still occurs.
The heaviest burden of unintended pregnancy rests on those who
are the most disadvantaged, the young, the poor and those without
the support of a caring family. Youth are particularly vulnerable.
We must make it a matter of high priority to educate our young
people to be responsible. We must promote responsible behaviour.
The importance of education and birth planning as well as policies
and programs that inform Canadian families and reduce the need
for abortions cannot be underestimated.
Health Canada will continue to make resources available where
our limited funds permit for activities related to sexual and
reproductive health issues. These include community based
projects funded through the health promotion contribution program
and grants provided to national heath organizations. It is important
that government and voluntary organizations work together to
respond effectively to health information needs, especially of high
risk or hard to reach populations.
We recognize the federal government has the legal authority to
conduct national referenda and that the federal government
contributes to the funding of provincial and territorial health
insurance plans.
However, we also recognize it is not within the constitutional
authority of the federal government to dictate the specifics of the
operation of provincial health plans. The federal government does
not fund specific health care services or types of services on a
national scale in the manner this motion suggests. Both as a matter
of law and as a matter of policy the federal government would not
intervene in the operation of provincial and territorial health
insurance plans so long as the principles of the Canada Health Act
are respected.
The government does not have any choice but to oppose this
motion within the context of the Canada Health Act. The
determination of what services to insure is a matter of provincial
and territorial jurisdiction.
Mr. Stan Dromisky (Thunder Bay-Atikokan, Lib.): Mr.
Speaker, responsibility for determining insured health services has
2981
always been with the provinces. We must stress that time and time
again because apparently our colleagues from the third party are
not in harmony with this concept.
The responsibility is determined in conjunction with the
respective medical associations. The Canada Health Act principle
of comprehensiveness requires that all provincial and territorial
health insurance plans provide coverage for medically necessary
services.
Let us be clear. The responsibility for determining which
services are medically necessary is a provincial one. Even though
the decisions regarding medical necessity are the responsibility of
the provinces and territories which manage their own health care
systems, we find that insured medical and hospital services are
more than evident between and among provinces and territories.
The federal government's role in part is to assume responsibility
for setting national criteria to ensure Canadians receive the care
they need. This is exactly what the Canada Health Act does. It
ensures residents of Canada have reasonable access to necessary
health care services on a prepaid basis.
(1200 )
Provinces administer their own health insurance plans. They
manage their own systems. They are in the best position to make
decisions regarding insured health services. This is particularly
important given that there is almost no service that is not medically
necessary in some situations. Why should we fix something that is
not broken?
The federal government has a responsibility to promote and
preserve the health of all Canadians. However, it cannot make the
kind of decision this private member's motion is asking for. To try
and use the spending power of the federal government in this way
would be contrary to how this federation functions.
What we should do and will continue to do is to use our spending
power to ensure that the five principles of the Canada Health Act
are maintained. There is in this country a longstanding partnership
between the federal, provincial and territorial governments with
regard to health care. It is a partnership that we continue to develop
and promote. Supporting this private member's motion would
disrupt this historical distinction and balance.
Mr. Myron Thompson (Wild Rose, Ref.): Mr. Speaker, I
realize there is not much time left so I will take as little time as
possible. I will raise a couple of points that the member for
Yorkton-Melville wanted to say before he ran out of time.
The hon. member points out to members of the House of
Commons and to the nation that a number of individuals in Canada
prefer not to support some things financially and they feel they
should have a voice. He is trying to give them that voice through a
referendum. If it is not possible to do it through a referendum, the
hon. member would have liked to have done it through a vote by
the members in the House of Commons.
The Bloc member said we do not need a referendum and that in
the House of Commons we should represent the people. I find it
very difficult to represent the people when we are denied a vote in
the House of Commons by the voice of one individual. I find that
totally unacceptable.
I also find it rather strange to hear the government members
rigorously talking about the provinces' responsibility to decide
whether or not they want to fund abortions or the provinces'
responsibility in making a number of decisions when not too long
ago I heard the Liberal members say point blank that the provinces
would do as they tell them or their funding would be stopped. How
hypocritical can they get? One day they are saying it is up to the
provinces to decide how they want to run their system and the next
day the federal government is going to take away all their funding
if they do not do what they are told.
It boils down to when important issues come before the people of
Canada, the one thing most Canadians do not realize is that they are
being denied democracy by this Liberal government. They have
been denied democracy for the past 10, 15, 20 or 30 years.
Canadians want it to stop and I agree with them. It is time that
democracy started ruling this House instead of the dictatorial
attitude of certain individuals who sit on that side of the platform.
The sooner that happens, the better off we will be.
[Translation]
The Deputy Speaker: The time provided for the consideration
of Private Members' Business has now expired and the matter is
dropped from the order paper.
_____________________________________________
2981
GOVERNMENT ORDERS
[
English]
The House proceeded to the consideration of Bill C-31, an act to
implement certain provisions of the budget tabled in Parliament on
March 6, 1996, as reported (with amendment) from the committee.
Hon. Paul Martin (Minister of Finance, Lib.) moved that the
bill, as amended, be concurred in.
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.)
The Deputy Speaker: When shall the bill be read a third time?
By leave, now?
2982
Some hon. members: Agreed.
Mr. Martin (LaSalle-Émard) moved that the bill be read the
third time and passed.
(1205 )
Mr. Barry Campbell (Parliamentary Secretary to Minister of
Finance, Lib.): Mr. Speaker, it is my pleasure to launch third
reading of Bill C-31, the 1996 budget implementation act.
Of all the legislation proposed by a government, it is budgetary
measures that stand at the core because they define the bottom line
capabilities and concerns of government itself. This is especially
true of Bill C-31. It is legislation dedicated to dramatic discipline
change, change in the way government operates, change in how
government spends and change in how government establishes and
addresses its priorities.
[Translation]
These changes were not proposed just for the sake of it. Our
initiatives reflect a reality experienced by governments in Canada
as well as elsewhere in the world: they have to reassess their roles
and responsibilities.
This does not mean that we have to give up the activities that are
the government's reason for being: promoting job creation and
economic growth as well as protecting people who are suffering
great hardships because of change. Both these missions remain
sacred for our government.
However, in this era of diminishing resources and intense global
competition-a reality that has an influence on the operation of our
economy-we must examine ways to fulfil these responsibilities
more efficiently and more economically. We must also make better
decisions about the priorities that are under our jurisdiction and
about those that are more obviously the concern of other
stakeholders in our society.
Getting the government right: that is the challenge at the very
heart of this bill. I would like to point out to the House very briefly
a few examples taken from the bill itself.
[English]
The bill includes measures to allow the Minister of Transport to
privatize the government's fleet of grain hopper cars. Other clauses
will remove the 10-year ceiling that was imposed on the repayment
schedules for students who borrowed money under the Canada
Student Loans Act. This will benefit students and may well save
the government money by reducing the number of loan defaults.
We propose to amend the Radiocommunication Act allowing the
Minister of Industry to obtain greater revenues by auctioning off
radio spectrum licences.
An important thrust of our government is to develop alternative
ways to deliver services. That is why we will be introducing new
service agencies and other mechanisms to deliver services to
Canadians with the emphasis on better service and greater
efficiency. To aid in this process, this bill includes legislative
amendments to give the government the administrative
mechanisms necessary to ensure a smooth transition to the new
service delivery modes.
For instance, changes proposed to the Canada Labour Code and
Public Service Staff Relations Act will permit the introduction of
successor rights. That means unions will continue to represent their
employees as they move from public service employment to other
employers within federal jurisdiction. Collective agreements of
course will continue to be in force until the terms expire.
We also want these new service agencies to have the tools they
need to operate effectively and affordably. We will amend the
Financial Administration Act to allow for multiyear appropriations
for these organizations.
[Translation]
In the future, we will certainly not be able to improve the
efficiency and the effectiveness of the federal administration
without giving consideration to our employees, the people
providing the services Canadians expect.
As we all know, collective bargaining in the public service was
suspended when the previous government implemented the Public
Sector Compensation Act. This act will expire, as provided for, in
February 1997, when the collective bargaining system will come
back into force.
However, when we negotiate conditions of employment with
labour unions during the next three years, it will be necessary, in
our opinion, to suspend binding arbitration for dispute settlement.
We simply cannot afford having independent arbitrators, who are
not accountable to Parliament, making decisions that do not reflect
our financial situation.
Employees of the House, of the Senate, of the Library of
Parliament and of the Canadian Security Intelligence Service are
exempted. This is because they do not have the right to strike and
are dependent on binding arbitration. In their case, arbitrators will
have to take into consideration salary settlements in similar
occupational groups in the public service.
(1210)
[English]
This bill will provide authority for a 2.2 per cent increase for
non-commissioned members of the Canadian forces. This measure
will address the disparity in wages between members of the forces
and public service employees, a disparity that existed before the
wage freeze.
We are amending the Public Sector Compensation Act to
reinstate performance pay after a five year suspension in annual
increments for those employees for whom it was suspended when
2983
we introduced the in-range increment freeze two years ago. The bill
also contains reform measures regarding public service pensions.
All public service employees, those who will be transferred out
and those who stay, will benefit from changes we propose to the
Public Service Superannuation Act. This includes the two year
vesting of pension benefits and new lock-in provisions. Pension
benefits of public servants transferring to other organizations will
be fully protected.
I must underscore the fact that the government will consult on
the details of these proposals before they come into effect.
Amendments to the Public Service Superannuation Act will also
give us the flexibility to extend coverage under the act for a limited
term to employees who are transferred out of the public service.
There are two further measures we are taking so we can deliver
better service while being fiscally responsible. First, we will
modify the Financial Administration Act to give Treasury Board
the authority to establish group insurance plans for the public
service, to set terms for the management of those programs and to
acquire such programs by contract. This will allow these programs
to be managed in a way that is more consistent with insurance
practices in the private sector.
Second, we propose to amend the Public Service Staff Relations
Act so that the government can better meet its ongoing youth
employment responsibilities. We plan to provide students with
learning opportunities and facilitate their transition from school to
work. Their employment benefits will reflect their training status.
This is legislation centred on change. It is also legislation that
will provide new certainty in an important area of Canadian
activity, that is, federal support to provinces to better secure this
country's social programs. This bill will amend the
Federal-Provincial Fiscal Arrangements Act. We propose to
provide secure stable funding for the Canada health and social
transfer for an additional five years through to the year 2002-03.
As I have said before, and as the minister has emphasized, there
should be no mistake about our commitment to this funding. In
fact, in the three years beginning in April 2000, CHST levels are
projected to rise. By 2002-03 total CHST entitlements are expected
to be $2.3 billion higher than the level set for the fiscal year
1997-98. To provide additional assurance to Canadians, this
legislation sets a floor, an ironclad guarantee that cash transfers
will be maintained at or above the $11 billion level.
This proposed legislation also provides a new formula for
allocating the CHST among provinces. Under this new formula
which will be phased in over five years, existing disparities and per
capita funding across provinces will be cut in half. Let me point out
that the gradual phase-in of the new formula not only gives
provinces time to adjust, it gives them maximum certainty in their
planning.
It is also worth repeating that this single consolidated block
transfer represents a more flexible and mature approach to
federal-provincial fiscal relations. It gives the provinces extra
flexibility as they design and administer their own programs while
safeguarding the social programs Canadians rely on and support.
I remind hon. members of changes that this bill proposes to the
Unemployment Insurance Act. Effective January 1 of this year the
maximum insurable earnings are to be reduced to $750 per week in
comparison with the $845 level which would have resulted under
current legislation. Similarly, the maximum weekly benefit drops
from $465 per week to $413. These measures will save $200
million in the second half of this year and reduce the UI payroll tax
burden on working Canadians.
This bill also amends the Old Age Security Act to lengthen the
period of time before newcomers to Canada become entitled to full
guaranteed income supplement or spouse's allowance. Under the
current system, some immigrants obtain full benefits with as little
as one year's residence in Canada. Restricting this easy access will
improve the fairness of the system and lessen the burden on
Canadian taxpayers.
(1215)
There is a final issue this legislation deals with which is part of
an important national initiative announced just a few weeks ago,
and this is adjustment support for the Atlantic provinces in
harmonizing their sales taxes with the federal GST. Some voices in
the country have tried to make political hay of this decision.
However, I am convinced, and the government is convinced, that it
is acting in a fair and responsible way and in the long term interests
of Canadians.
This bill provides approximately $960 million in adjustment
assistance to the provinces of Nova Scotia, New Brunswick,
Newfoundland and Labrador over a four-year period. This is
intended to cover a fair share of the initial revenue losses they
experience under the harmonized sales tax regime.
The government firmly believes, given the benefits that will
flow from harmonization, that the total cost is reasonable and
responsible. It is fully in keeping with firmly established practices
of providing assistance when federal initiatives entail major
structural change for provinces. Let me emphasize that this
adjustment assistance will not jeopardize our deficit targets. These
targets are secure.
In addition to the three provinces previously mentioned, Prince
Edward Island, Manitoba and Saskatchewan would also qualify for
assistance should they agree to harmonize their sales taxes.
Ontario, British Columbia, Alberta and Quebec would not.
2984
[Translation]
This deserves one last comment, more particularly in view of the
remarks made in the House and the media when the Quebec finance
minister recently sent a bill to the federal government.
In a nutshell, this is a totally groundless request that has
everything to do with a separatist project and nothing to do with
facts, history and economic common sense.
We are providing this adjustment assistance only to provinces
that experience, through tax harmonization, a drop of more than 5
per cent in revenues from their retail sales tax.
But Quebec did not lose any money when it harmonized.
Therefore, it is not entitled to any assistance.
Quebec has decided to spread the harmonization process over six
years, and has been able to increase its revenues in the process
because of the wider tax base of the value-added tax, while it kept
taxing many business inputs.
[English]
On the basis of the partially harmonized sales tax system in place
between 1992 and 1995, Quebec would not have qualified for
assistance and once fully harmonized it still will not qualify.
The three Atlantic provinces that are now harmonizing have
decided to move to a single tax all at once. This means they will not
have the option of boosting revenues during the phase in period.
Therefore, the adjustment assistance is essential to ensure they
have the opportunity to participate in a single sales tax system on
the same basis as Quebec and the other larger provinces.
I have taken up more time than normal at this stage of legislation
but Bill C-31 deserves the effort because it will implement wide
ranging beneficial change in so many areas.
Let me conclude with the same observation I made to the House
finance committee. This bill is the heart and soul of the
government's fiscal agenda as laid out in the budget. The story here
is quite simple: getting government right. It is one we should all
agree on in principle. I trust that the House will provide its
approval so we can get on with meeting that goal.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, my colleague caught me a bit by surprise. He usually
takes a lot more time to explain things. With all the nonsense he
said in the last part of his speech on Bill C-31, about us, separatists,
acting in bad faith, I was hoping his speech was going to take much
longer. However, I have to admit that he caught me by surprise.
I am pleased to take part in the third reading stage debate on Bill
C-31, a piece of legislation the official opposition considers very
important, especially-and here is what I want to focus on-the
part dealing with the compensation paid to three maritime
provinces within the partisan initiative launched by the Minister of
Finance to harmonize the GST in that region of Canada.
(1220)
Before tackling head on this compensation issue, I want to go
over some historical facts about the GST, although this part of our
history is recent, well, maybe not so recent, since it only dates back
to the time the Liberals were in the opposition, but that is still a part
of our history which is, in my view, full of contradictions and
cover-ups about the commitments made by the Liberals concerning
the GST. When addressing such an issue, I think it is always
important to remind the people of Quebec and of Canada of the
many commitments made by the current government.
First of all, let me remind the House that, when the Liberal Party
of Canada was in the opposition, when its representatives were
sitting on this side of the House, they energetically decried the new
goods and services tax introduced by the Conservative government.
At the time, how many Liberal members made a big fuss and even
raised quite an uproar just to condemn this Conservative policy?
Even during the election campaign, at the end of which 54
members of the Bloc Quebecois were elected and now sit in the
official opposition, the current Prime Minister made some pretty
clear commitments concerning the GST. He said that it was out of
the question for him to keep the GST if he ever was elected head of
government.
I remember that, four or five months after he was elected, the
Prime Minister even said, I think it was on May 2, 1994: ``We hate
it and we will kill it''. There are people in Quebec as well as in
Canada who voted for the Liberal Party because they hated this tax,
because they believed in the commitments of Liberal members,
because they believed that the Liberals, then in the opposition,
were going to fight this tax with all their might and eventually, as
the Prime Minister and many officials had promised-including
the Deputy Prime Minister who was forced to resign lately because
of this promise-because they believed that the Liberals were
going to abolish the GST as promised. Instead, the government is
resorting to the usual smoke screens and introducing the first phase
of an in depth reform of the GST signed by the three maritime
provinces, that is, New Brunswick, Nova Scotia and
Newfoundland.
Not only is this in complete violation of the Liberal election
promise but this agreement, this vague attempt at a reform of the
commodity tax will be extremely costly for all Quebecers and all
Canadians. Why? Because the agreement announced
approximately one month ago but the technical details of which
have not been released yet provides for the payment to the three
maritime
2985
provinces of a $961 million compensation over the next four years,
that is, almost $1 billion.
This is $1 billion that all Quebecers and all Canadians outside
the three maritime provinces will have to pay to compensate for a
loss of revenue due to the harmonization of the GST, to this vague
attempt at a reform, to this mockery of an attempt at keeping their
words by the Liberal Party of Canada, when they had in fact
promised to kill the GST.
The government is spending $1 billion to make us believe that it
is doing something about the GST. One billion dollars to make the
GST disappear, not disappear in the true meaning of the word, but
to hypocritically bury it in the price of products in the three
maritime provinces. Frankly, it is unacceptable.
That is not what Quebecers and Canadians had understood
during the election campaign. In fact, two government members
resigned recently precisely to show that the Liberal government did
not fulfil its promise, its campaign commitment to abolish the GST.
These two Liberal members had the courage of their convictions
and decided to inform the public that they could not live with the
fact that their party did not fulfil its promise when it signed that
agreement with the three maritime provinces.
(1225)
What precisely are the terms of this agreement? Just like the
Government of Quebec, the Government of Alberta and the
Government of Ontario, we tried to know the exact terms of the
agreement the federal government concluded with New Brunswick,
Nova Scotia and Newfoundland. We tried to get the details, but all
our efforts have been fruitless. Why is the Minister of Finance
hiding the exact terms of this agreement from the people of
Canada?
We know, in general terms, that the compensation principle
applied by the federal government is as follows: the federal
government decided, unilaterally, that the provincial sales tax and
the federal GST together could not be more than 15 per cent. It has
also decided unilaterally, without any consultation, that it would
compensate the maritime provinces if the provincial sales tax and
the GST combined exceeded 15 per cent. If you look at the three
maritime provinces, you will see that the PST and GST combined
are just over 19 per cent.
So the federal government has decided unilaterally that the new
harmonized sales tax would not exceed 15 per cent and that it
would compensate the provinces for the difference between 15 per
cent and 19 per cent. The federal government has decided to
compensate the governments of the three maritime provinces for
this loss of four percentage points in sales tax, even though it
represents tax relief for consumers in these provinces.
How did the government estimate this loss? We do not know. We
do not know where it got the figures with regard to tax revenues
and to the cost of this harmonization exercise, but the finance
minister is asking us to trust him, to give him a free hand, just like
he does every time he makes deals behind closed doors and then
imposes these things upon us, begging us not to ask too many
questions. He is telling us to trust him.
The government is giving close to $1 billion to three maritime
provinces for a partisan policy, a policy whose sole purpose is to
show that the government is doing something about the GST. Do
you not think it is a bit expensive? Do you not think it is expensive
for Canadian taxpayers outside these three maritime provinces and
also for Quebec taxpayers? Between $200 and $250 million of that
sum will come from Quebecers. And the remaining $700 million
will come from taxpayers from the rest of Canada.
If, in the opinion of several government representatives
according to a member of the Liberal Party, we have to pay such a
price every time we need to harmonize policies, every time we
need to improve the economic and commercial operation of the
federation, I wonder what is the value of the federalism these
people have been defending desperately since we have come to this
place. I wonder what it is worth if a part of the population of
Quebec and Canada have to pay such a price every time people on
the other side of the House want to improve the tax system.
I will quote someone I do not quote often because our ideas
rarely coincide, particularly on constitutional matters. However, I
want to quote the chief editorial writer of La Presse, Mr. Dubuc,
who, of course, supported our point of view last week-end when he
wrote: ``The federal government and its Minister of Finance made
a huge blunder when, in order to convince them to harmonize their
sales tax with the federal GST, they promised the Atlantic
provinces to give them $960 million''. That was written by Alain
Dubuc.
(1230)
He added: ``The Chrétien government had to buy them to
convince them to adopt the GST system because he absolutely
needed their support to be able to claim that he replaced the GST
with an harmonized tax of 15 per cent. In other words-and I am
still quoting Alain Dubuc from La Presse-$1 billion in public
funds were spent in a partisan way for the sole purpose of allowing
the Liberal government to claim that it was fulfilling its promise''.
Seeing the official opposition in agreement with Alain Dubuc is
like, in Quebec, seeing Gérald Larose in agreement with Ghislain
Dufour. Suffice it to say that opposition to the Liberal
government's ridiculous GST policy is pretty much unanimous.
2986
More and more Canadians are saying no to this sort of short
sighted policy, this one step at a time strategy of claiming
successes at various levels. I would say the Liberal Party is a past
master at this game.
Quebec harmonized its provincial sales tax with the GST in 1991
and has had one system since then. The two systems of taxation
were combined, with one administrative body, the Government of
Quebec, administering its own sales tax in addition to the goods
and services tax for the federal government. It did not cost the
federal government one red cent, except, of course, what it
understandably pays for relying on the services of the Government
of Quebec to administer the federal goods and services tax.
There was never any question of the sort of compensation that is
part of the agreement between the three maritime provinces and the
federal government. Why was that? Because in Quebec, everyone
recognized-business and the public alike-that some degree of
harmonization was necessary in order to facilitate commercial
transactions and the operation of the economy. We understood that
and we did not need a $1 billion nudge from the federal
government. We understood that and we did not need to be bribed
to improve the Government of Quebec's system of collecting and
administering taxes.
Why must there now be compensation of close to $1 billion for
three provinces that are very cosy with the federal government?
Why must Canadians in other provinces and Quebecers be made to
pay for this local agreement between the federal government and
the three maritime provinces? There is something not right about
this policy.
Quebecers and Canadians need to understand what the federal
government might do for these three provinces further down the
road. Not only is there compensation of close to $1 billion paid for
nothing-partisan compensation from federalists who normally
support this government-but, furthermore, four years from now
when the federal compensation comes to an end, it is not
impossible, and it is even probable, that equalization payments will
take over where the federal government's subsidy leaves off.
(1235)
Why is this likely to happen? Why must Quebecers and
Canadians alike see hundreds of millions of dollars more added on
to this bad and partisan contract between the federal government
and the three maritime provinces in the next few years? For a
number of reasons.
I shall not go into the complex details of the equalization
formula, but allow me to give an overview of how it works.
There is an equalization system in Canada, which affects certain
provinces, including Quebec, in order to ensure that the poorest
provinces, the ones which cannot raise sufficient tax revenues to
ensure equivalent levels of services from east to west in Canada,
can provide those services. When a complex formula is applied to
calculate the taxation base for each province, the ability to collect
taxes, this is where equalization payments come in for the poorest
provinces.
One of the criteria for applying equalization payments is the tax
base. In other words, if a province or provinces-in this case the
three maritime provinces-have their tax base reduced by a federal
policy related to the changes in the GST, equalization kicks in
automatically to replace this reduction in the tax base.
In other words-returning to what was said at the beginning-at
this time, when you take the average of the sales taxes in the three
maritime provinces and add the GST, you get a taxation rate of over
19 per cent. The Minister of Finance decided it would be 15 per
cent in future, so he is lowering the three maritime provinces' tax
base by more than 4 points, more than 4 per cent. By doing so,
however, by voluntarily reducing consumption taxes by 4 or 5
points, under a partisan agreement that hits all taxpayers in the
pocket book, the equalization formula will necessarily kick in
because the tax base has been lowered.
Once the $961 million are paid to New Brunswick,
Newfoundland and Nova Scotia, there is a mechanism which will
force all Canadians and Quebecers, with the exception of the
Atlantic provinces, to continue to pay this average compensation,
hundreds of millions of dollars through equalization payments,
because the Finance Minister has decided, in the name of the
government, to show off. By doing this he wanted to prove that his
government is going ahead with the tax reform, that it has begun to
hold its promises on the GST. In fact, the government is doing no
such thing since it had actually promised to abolish the GST once
in power.
This agreement is getting costly. First of all, it settles nothing, in
terms of sales tax harmonisation. There is still going to be a sales
tax and there is no single system for the consumption tax in
Canada. Second, equalization will come into play in the coming
years to add to the first billion dollars paid by the federal
government. Third, there is this whole mess created by the finance
minister and the government through this agreement.
As if the constitutional muddle he created was not enough, the
Prime Minister added to it, through the finance minister, by signing
secretly, behind closed doors, this agreement on the GST with three
Atlantic provinces, knowing full well that Quebec had harmonized
its tax in 1991, at no cost. They did not boast about it. When
Quebec costs nothing and Quebec is the most efficient and even
one of the most effective partners in the Canadian federation in
2987
trade and economic terms, they try to keep it under wraps,
because the nasty separatists do not make good trading partners
in this federation.
We are trying to find out more about this agreement. We are
trying to find out more about the subject of our remarks this
morning, that is, the part of Bill C-31 on the $961 million in
compensation paid to the maritime provinces. What is distressing,
however, is that we have had no response from the government. We
asked for the detailed agreement between the federal government
and the three maritime provinces. And we, the Bloc Quebecois, the
official opposition, are not the only ones to ask for it. The
Government of Quebec asked for it, as did the governments of
Ontario and Alberta. Instead of responding, making things clear
and revealing the details of the agreement, the Minister of Finance
hid behind terms that needed tidying up, saying it would have to
wait until next year, perhaps.
(1240)
This is unacceptable. The Minister of Finance signs an
agreement with some members of the Canadian federation that
costs us $1 billion, and he refuses to tell us how he reached the
figure of $1 billion. This is not normal. He will say: ``You know the
details. Sales taxes are at approximately 19 per cent in the
maritimes at the moment. I have decided unilaterally that the
combined tax, the new GST, will be no higher than 15 per cent, and
I have decided to make up the difference''.
There are a number of other questions the Minister of Finance is
refusing to answer. The first one that comes to mind, which I
mentioned earlier, concerns the real cost of the agreement. We are
not talking simply about $961 million. There are other implications
in terms of equalization payments.
The second question is: ``How were the calculations made?''
Any figure can be arrived at, it is only a matter of working from
solid assumptions. But on what basis, on what assumptions was
this deal with the maritimes reached, and how was the famous
figure of $961 million arrived at?
For example, what is the anticipated revenue from the new goods
and services tax in the three maritime provinces for the coming
years? Do we at least have projected revenue for 1997-98, 1998-99,
1999-2000 and the following years? It is essential to know this. It is
essential because, in addition to reducing the rate in the maritimes
from 19 per cent to 15 per cent on average, the tax base has been
extended, the new tax has been extended and will from now on
apply to services in New Brunswick, in Nova Scotia and in
Newfoundland. What more will this bring in, in terms of revenue?
Is the extension to services of a 15 per cent tax-which was not
applicable to services before-going to generate so much revenue
that it will compensate for the reduction of the present tax on goods
from 19 per cent to 15 per cent?
It is important to know this. If this extension generates extra
revenue, could it be, this is the third question, that the
compensation of nearly $1 billion-$250 million and $700 million
of which are paid respectively by Quebecers and people in other
Canadian provinces-is not necessary? The Minister of Finance
said that it was necessary. This is not the way to govern a country.
This is not the way to inform the public about the activities of a
government, about justified actions of a government.
People need to be given explanations, they need to know this
kind of detail to be able to judge the appropriateness of this deal.
For the moment, the impression we have-not only us but people
like Alain Dubuc, who are not necessarily and even rarely on the
side of the official opposition or the Bloc Quebecois-is that it
looks suspicious. Not only does it seem partisan, we have
indications that it really is, according to the consensus reached
outside the maritimes, in particular in Quebec, Ontario and
Alberta.
Another question deserves an answer from the Minister of
Finance, namely: ``What were the alternatives?'' Considering what
happened in Quebec, where both taxes were harmonized without it
costing the rest of the country a single cent, where Quebec
succeeded in balancing its tax base and found different ways of
managing its taxation system effectively, how is it that no
alternative was considered to the agreement reached between the
Minister of Finance and the three maritime provinces?
(1245)
Could it be that, if the Minister of Finance had done his
homework, if it had not been only a partisan matter for the federal
government, there could have been other ways of compensating for
lost revenues in the three maritime provinces within their own
taxation systems?
If the finance minister had acted properly, and had wisely and
competently analyzed the evolution of the tax burden as well as the
present tax burden of taxpayers in Nova Scotia, New Brunswick,
and Newfoundland, he would have easily realized-it does not take
a rocket scientist for that-that, by lowering the consumption tax
from 19 per cent to 15 per cent with his new policy, he was doing
them a favour.
However certain adjustments to the provincial income tax in
these three provinces might have been necessary. Without
increasing the total tax burden of people in these three maritime
provinces, personal and corporate income taxes could have been
slightly increased in these three provinces in order to offset the loss
in revenue from the consumption tax. It would have been
legitimate, efficient and normal since taxpayers in these three
provinces will see their consumption tax reduced by four to five
points over the next few years and, unless it is decided otherwise,
forever.
2988
Would it not have been more logical to find a local solution
to a local problem of tax harmonization and efficiency? I think
so, and I believe it does not take much figuring out to reach this
conclusion. I believe that if the finance minister had really wanted
to contribute to improved taxation and to the harmonization of a
new tax across Canada, he would have gone about it differently.
It would not have been difficult.
I am extremely disappointed by the government's handling of
this issue. As I said before, until now we have not succeeded, just
as the Quebec government and other provincial governments have
not succeeded in obtaining details of this agreement.
Today, in this House, I would like to present the government
with a formal request. Would it be possible to shortly obtain all the
documents, not only the press releases and the media
documentation, but also the technical data at the basis of the $961
million figure, the technical data which would support some sound
projections on tax revenues in the maritimes and a cost projection
for the harmonization?
When we spend $1 billion, it seems only reasonable that people
know what they are paying for. Until now the finance minister's
attitude has been outrageous. This scandalous decision comes after
others like the $2 billion invested in family trusts which crossed
over to the United States without a penny being paid in taxes on
capital gains.
For two and a half years now, we have been asking the
government to act on that issue. For two and a half years, we have
been saying it is inadmissible, but the government does nothing;
they sit there and say family trusts are unimportant. That is why $2
billion from two family trusts were transferred south of the border
tax free. Today, the government realizes the problem and says
maybe we should review the taxation system. For two and a half
years, we have been saying that the taxation system makes no
sense. Now the government is asking the finance committee to find
a solution. It was high time.
To avoid repeating the mistakes due to its incompetence, why is
the government not listening to the official opposition, the
Government of Quebec, the governments of Ontario and Alberta,
Canadians and Quebecers who are asking that it suspend the
process leading to the payment of a billion dollars in compensation
to three maritime provinces, and that the whole question of
harmonization of the GST be submitted to the next meeting of
finance ministers which is to be held around June 18?
(1250)
It seems to me that the process would be somewhat more open if
the government were to table all the relevant data relating to the
GST and make them available to all representatives of the
Canadian provinces and Quebec, so they could talk about it and
find ways to improve the federal tax system and the provincial tax
systems.
It seems to me that, for once, it would be nice to have the
Minister of Finance follow his own logic. We are talking about
harmony, not just harmonization, between the federal government
and the provinces, but when the time comes to make concrete
decisions, goodbye harmony. As my colleague from
Rimouski-Témiscouata would say: poof! harmony.
It seems to me it is high time that, for such important questions
regarding taxation of consumer goods and services, the Minister of
Finance be more open, that he table the technical documents we
request and, moreover, that he discuss this question of
harmonization of the GST and provincial sales taxes with his
provincial counterparts at the next conference. In the meantime, he
should stop implementing processes like this one which involves
payment of $1 billion in compensation.
I think that most Quebecers and Canadians would be better off if
the Minister of Finance were to listen to us, for once, and stopped
acting that way. For all these reasons, on top of asking for
suspension of the payment of $961 million, I urge all my
colleagues in the official opposition, in the Bloc Quebecois, to vote
against this bill.
[English]
Mr. Leon E. Benoit (Vegreville, Ref.): Mr. Speaker, I rise to
speak at third reading of Bill C-31, the budget implementation act.
In my speech I will critique the latest Liberal budget on how it
responds to the wants and needs of Canadians.
I will focus on the main concern of all Canadians, namely, the
creation and preservation of long term sustainable jobs. I will
critique the Liberal government's performance in creating jobs,
which is what it promised during the last election and since, and
compare the results with the Reform Party's plan for economic
prosperity.
A government budget is more than a forecast of spending
practices. It is a game plan, a master plan which tells the people
what are the intentions, the priorities and the goals of their
government. It is a promise of performance.
The previous budgets of this government have been small steps
in the right direction. The intention: deficit reduction. The priority:
job creation. The goal: a better economic future for Canadians.
Even though the route taken by the Liberals has been slow,
arcane and convoluted, on this side of the House we felt that they
were headed in the right direction with past budgets. The 1996-97
budget is a much different story. The intention: to pull the wool
over the eyes of Canadians. The priority: to maintain the status quo.
The goal: to lead Canadians to believe that it has delivered on its
promises in order to get re-elected. Canadians are smarter than that.
2989
The government has promoted its political interest by
subordinating the interests of hard working, tax paying Canadians.
The government and, in particular, the Prime Minister and the
Minister of Finance should be ashamed of themselves. We in the
Reform Party feel that it is our obligation as elected representatives
to get to our electorate to find out what our constituents want and to
represent them in the manner in which they want to be represented.
As this is not the practice of many members opposite I will take a
few moments to tell them what Canadians wanted from this budget.
Canadians wanted five things. They wanted long term
sustainable jobs, tax relief, long term sustainability for social
programs, an increased standard of living and to know when the
government will balance the budget. Many Canadians have come
to realize that the first four items on their list cannot be achieved
until the government stops adding to the debt and the interest
payments to service the debt. This list cannot be achieved if the
debt is not stabilized and then reduced.
(1255 )
This list is not too much to ask from a government that
campaigned on creating opportunities. Canadians were not
expecting the government to create for them the opportunity to file
bankruptcy or the opportunity to watch their jobs head south of the
border or the opportunity to see their payroll and gas taxes
skyrocket. It is probably not very comforting for Canadians to
know that all of these opportunities are considered to be acts of
God by our Prime Minister.
Rhetoric aside, let us take a closer look at this taxpayers' wish
list to see how well this budget comes through for Canadians. First
is the area of long term sustainable jobs. Canadians want work.
They want to pursue employment opportunities created through a
healthy and prosperous economy.
The government claims to have created hundreds of thousands of
jobs. In the year ended December 31, 1995, employment had grown
only a meagre 8,000 jobs. That is a fact. This number represents
half a per cent of the labour force. Of course, these jobs were not
created by government-nor should jobs be-but rather by
companies and individuals.
The national unemployment figure is hovering just shy of the
double digit range and does not take into account those who are no
longer looking for work. The actual percentage of unemployed
Canadians is approximately 13 per cent when including those who
have given up looking for work. This figure is doubled when
applied to unemployed youth.
The government has said that it is dealing with student
unemployment. The budget contains a new initiative to spend $250
million on jobs for a few lucky students. These jobs will provide
summer employment for a minute percentage of our youth.
However, the initiative will not help to create real employment
opportunities after graduation.
I would have thought that after the huge success-I say this with
tongue in cheek-of the national infrastucture program, the
government would have realized that throwing money into make
work projects does not create meaningful jobs.
The second thing Canadians want from a budget and from a
government is tax relief. The level of taxation in this country is one
of the major job killers. This happens on many different fronts.
Many corporations that are looking to expand operations do not
consider Canada because of the outrageous level of taxation. It is a
killer of potential jobs for Canadians.
Many companies in Canada cannot afford to maintain the size of
their workforce due to the taxation cost per employee. This results
in mass layoffs and downsizing and is the killer of present jobs.
In 1995, based on an average family income of $57,000, this
family paid over $27,000 in taxes of one type or another. That is a
taxation level of 46 per cent. Some estimates show the level at over
50 per cent when all types of taxation are considered. The average
Canadian family's tax bill has increased by over 1,000 per cent
since 1961 under successive Liberal and Conservative
governments. That is not double, nor is it increased by a factor of
10. It is a shameful record. This budget does not provide tax relief.
Third, Canadians expect the budget and the government to
preserve social programs. Canadians are concerned that the
funding available for social programs such as health care, old age
security and unemployment insurance will be swallowed up by
debt servicing costs, that is, the interest payments on the debt.
Currently Canada wastes close to $50 billion a year servicing the
debt. That $50 billion is no longer available for social program
spending on important programs such as health, education and
pensions.
(1300)
This has resulted in tax grabs and clawbacks, especially from our
seniors. The changes to the mandatory withdrawal of RRSPs and
the clawback on federal pensions at $40,000 are robbing our retired
seniors of the savings they struggled for decades to accumulate.
The government promised to maintain universality of social
programs. During the last election campaign the Reform Party
proposed reducing and eliminating pensions for seniors who were
above the average Canadian household income of $53,000. When
we came out in the open and presented very honestly our zero in
three plan the Liberals condemned us to Canadians for wanting to
end universality of social programs. In the finance minister's last
2990
budget he, the same person who condemned us for our zero in three
plan, ended universality of seniors pensions.
The dishonesty is astounding. I think Canadians should know
about it and consider it as we get into this next election period.
By not dealing with the deficit in the budget and with the debt
continuing to grow and therefore the cost of servicing the debt, the
government is jeopardizing the social programs which are most
important to Canadians.
The fourth thing Canadians wanted and expected from the
budget was an increase in the standard of living. For the last two
decades Canadians' standard of living has been dropping. That is,
take home pay after taxes and other payroll deductions has been
decreasing steadily for the last couple of decades. Since 1989
Canadians have suffered an 8.6 per cent drop in real disposable
income. That is just since 1989. This is attributable to an ever
increasing tax bill. Due to ever growing levels of taxes and payroll
deductions Canadians have less money to invest, to buy a car with,
to buy a home with or to take that elusive dream vacation.
The Canadian standard of living has stagnated and regressed to
the point where present and future generations will be worse off
than their parents. This scenario is courtesy of the tax and spend
policies of the present and previous Liberal and Conservative
governments. Clearly the blame is to be laid on previous Liberal
and Conservative governments and on this Liberal government.
The budget does not allow for an increase in the Canadian
standard of living, the fourth thing Canadians wanted and expected
from the government and the budget.
The fifth thing they wanted was a definite date for balancing the
budget. In a recent poll 66 per cent of Canadians surveyed
expressed the belief that the government has not gone far enough
with its deficit reduction plan. The Liberals are content to delay the
inevitable, bleeding red ink at a rate of over $80 million a day. This
means the government spends $80 million a day, still more than it
brings in; this is in spite of huge increases in tax revenues over the
term of the government.
Every legislative body in the country has made a commitment to
get its financial house in order except for the federal government.
Because of this inaction the national debt is barrelling toward $600
billion. Currently the debt load is over $40,000 for every Canadian
taxpayer.
The government blames the private sector for not doing its part
to create jobs. Instead of lecturing the business community on how
to create jobs, the government should work hard and make the
difficult decisions necessary to balance its books by the end of this
mandate. In doing so it would create an environment conducive to
economic growth and job creation.
I quote the finance minister from his budget speech of February
1994: ``For years governments have been promising more than they
can deliver and delivering more than they can afford. This has to
end and we are ending it''.
The question that comes to mind now is when. When will the
government end the ever increasing debt which requires the ever
increasing interest payments to service?
(1305)
The government's budgets have left Canadians with a deficit of
over $30 billion. Since the Liberals took power in 1993 the national
debt has grown by over $100 billion. The only thing the Liberals
are putting an end to are jobs, economic growth, disposable income
and certainly not the ever increasing debt.
It is not my intention to paint a dismal picture of Canada.
Canadians are creative, industrious, hard working people who
deserve a government which will legislate changes in their best
interests.
Canada has the potential to be one of the economic powers of the
global market. However, until the financial crisis is under control
this potential of prosperity is in jeopardy. Do not take my work for
it. This is what the experts are saying about this past budget of the
finance minister, the budget which this legislation we are debating
today would implement.
Diane Francis of the Financial Post stated:
The Liberals are not doing the cutting fast enough. By failing to cut deeper,
faster, the Liberals ignore the real possibility that another recession will hit in a
year or two and land us back in the deficit.
From Ernst & Young's budget analysis:
The government did not seize a most important opportunity to clearly
reinforce its resolve to deal with our national finances. It is important that all
Canadians not only understand when a balanced budget will be realized but also
when surpluses will be created to facilitate tax reductions, systemic debt
retirement and greater flexibility with our important social programs.
From Catherine Swift, president of the Canadian Federation of
Independent Business:
If we are going to see some enduring job creation and not just some political
quick fixes like some of our youth initiatives, then we have to see a reduction in
taxation on jobs, and we did not see that in this budget.
From the business editor of the Ottawa
Sun, Stuart McCarthy:
We are all left sitting on a ticking time bomb which grows by the second
called the national debt.
Granted, it is easy to sit back and criticize another's work, but it
is much more difficult and credible to offer an alternative. That is
what we in the Reform Party did when we published the taxpayers
budget. I find it strange that the Prime Minister and the finance
minister continually avoid our questions in question period by
2991
asking us where our new budget is. When you do it right the first
time, you do not have to redo it.
We did it right the first time with our taxpayers budget. The
taxpayers budget is a logical, comprehensive, efficient plan to
balance the federal budget. We stood behind it when it was first
released in early 1995 and so did many of the experts. We still
stand behind it because it works.
When asked difficult questions regarding cuts to social
programs, the finance minister often refers to the so-called cold
hearted Reform Party. He would have Canadians believe that I and
my colleagues would sell our dear mothers down the river in the
name of deficit reduction. It is the finance minister who has not
only sold mothers down the river but has sent the farm with them.
The Reform Party's taxpayers budget established an old age
pension clawback for those seniors whose yearly household income
is $54,000 or higher. We felt these seniors were able to live
comfortably without the assistance of the federal government. This
was a difficult decision to make but we were forthright and had the
courage to state our objections in writing.
The Liberal plan for old age security, and I have referred to it
already, establishes a clawback for seniors benefits at $40,000 a
year and ends universality of seniors pensions. Surely the finance
minister must be apologetic to our mothers and fathers who find
themselves paddleless on that infamous creek.
The finance minister is suddenly and conspicuously quiet on the
subject.
(1310)
Why is he so quiet? My guess is he has finally taken time to read
our taxpayers budget and is trying to steal our ideas without our
noticing. I have news for the finance minister. He can have them.
We presented the taxpayers budget for him to look at and to learn
from. That was our intent.
He would do well to take them and put them in effect. We would
see the positive results of that budget. To make it absolutely clear,
the Liberal government has cut about $3.5 billion more in the areas
of health care, education and welfare than the Reform Party
proposed in our taxpayers budget.
The same government, Prime Minister and finance minister who
call Reformers heartless have themselves reduced federal
government payments for health care, welfare and education by
$3.5 billion more than the Reform taxpayers budget.
What would Canadians gain through the implementation of the
taxpayers budget? If I wanted to be curt, I could mention
everything they have lost through the irresponsible practices of the
present and past Liberal and Conservative administrations.
Unfortunately it is not that simple.
The most important aspect of the taxpayers budget is that it takes
place over a relatively short time period. Canadians would regain
control of their financial lives quickly. Canadians would be freed
from the strains of our overburdened tax system and would be able
to plan for their futures in a stable economy with sustainable,
universal social programs.
The taxpayers budget offers deficit elimination and tax relief
which would stimulate long term private sector job creation. It
offers a more secure society established through the
re-examination and reform of social programs, the unemployment
of individuals and families and the decentralization of social
program delivery.
Reform's formula is one that will eliminate the deficit in a quick,
calculated, humanitarian way. Debt reduction and increased
consumer activity will lead to job creation. However, there are
other essential components to creating employment opportunities.
These are spelled out in Reform's five R plan in the taxpayers
budget: reduce the federal debt, relieve Canadians of their tax
burden, restore labour market efficiency and reduce social program
dependence, remove barriers to internal and external trade, and
renew Canada's physical and intellectual infrastructure.
The combination of these components is a sure fire way to create
an environment in which the private sector can thrive and in so
doing create long term, sustainable employment.
I have already spoken of the importance of reducing the deficit
and relieving Canadians of their tax burden. Notwithstanding the
importance of the previously stated issues, I will focus the
remainder of my speech on an area of job creation which I am
particularly interested in.
As the Reform Party internal trade critic, I am quite concerned
about the lack of action taken by the government in dismantling
barriers to internal trade. We in the House recently debated Bill
C-19, implementing an agreement on internal trade.
The government stated in the red book and in both throne
speeches that it is committed to the dismantling of the barriers to
internal trade. If this were truly the case, why did the government
pass Bill C-19 two weeks ago, 10 months after the agreement on
internal trade came into effect?
While the agreement on internal trade is weak and in some areas
actually tends to enshrine barriers, exactly the opposite of its
intention, at least it was a start. Yet the legislation to implement the
agreement was not passed in the House until 10 months after the
agreement came into effect, almost two years after the agreement
was reached in the first place.
2992
Interprovincial trade barriers cost Canadians jobs and money.
These are the two criteria budgets traditionally address, jobs and
money. A budget is supposed to outline what initiatives have been
undertaken to stimulate the economy, resulting in jobs and money.
This budget is a sunshine budget. The message of don't worry, be
happy does not wash with me or with Canadian taxpayers. We are
supposed to believe the government is doing all it can for
Canadians. To listen to the finance minister, he has not left a stone
unturned in his search for job creation and debt reduction.
(1315)
Unbelievably, the Prime Minister stated last week in Calgary
that high unemployment is unbeatable. The Prime Minister has
thrown up his hands and has said that we will have to live with
unemployment because we cannot beat it. Canadians are stuck with
high unemployment under this government. If the Prime Minister
is throwing up his hands and surrendering to unemployment, then
he should step aside. There is plenty which can be done right here
at home to deal with the high unemployment rate.
To start with, quick action should be taken to remove barriers to
internal trade. These barriers between the provinces are a serious
hurdle on the road to economic prosperity. Business groups, think
tanks and academics across Canada all agree that it is in the
economic best interests of all Canadians for trade barriers to be
eliminated.
According to the Fraser Institute, if Canadian firms were able to
operate freely across the country, the average Canadian household
income would rise by as much as $3,500 a year. This is another
means of putting dollars back in the hands of Canadians. This is a
matter that this government refuses to address in a serious way.
The Canadian Manufacturers' Association, the Fraser Institute,
the C.D. Howe Institute and others estimate that internal trade
barriers cost Canadian businesses between $6 billion and $10
billion a year. It amazes me that this situation has not been
addressed in any substantive way by the government. Stephen Van
Houten, president of the Canadian Manufacturers' Association,
said that trade barriers result in lost sales, lost investment and lost
jobs.
Many Canadian businesses have had to resort to going through
the United States, through American companies, in order to do
business with businesses in other Canadian provinces. It is sad that
it is easier to do business with the United States and Mexico than it
is with other provinces.
Members may ask how this will affect job creation. Many
companies are forced to leave Canada because they simply cannot
afford to stay. When they leave they take with them Canadian jobs.
Businesses leave Canada, certainly for many reasons, all of which
must be eliminated.
I have already talked about the high taxes and payroll deductions
driving businesses and jobs out of Canada. Excessive government
regulation and interference is another factor causing businesses to
leave this country. The restrictions and barriers to internal trade are
another. We are not talking about a few dozen jobs. We are talking
about tens of thousands and probably hundreds of thousands of jobs
all lost because government in this country will not eliminate the
barriers to internal trade.
I will cite one example. I will not use the company's name
because I have not asked permission to do so. There is a company
in northern Ontario that specializes in the high tech industrial heat
treating of materials. This company is state of the art. Its workers
are highly skilled at their trade. The company entered into
tendering competitions for government contracts in Manitoba and
Quebec. In both cases, the Ontario company could provide the best
product at the lowest price. There was no doubt about that.
In both cases it was awarded conditional contracts. In Manitoba,
the job would be awarded if this company would post an enormous
payroll bond to cover its workers, a bond which was completely out
of reach for this small company. In Quebec, the contract would be
awarded only if Quebec workers were used. This is a highly
specialized company which has spent a lot of time and money
training staff to do a highly specialized job very efficiently. In both
cases, the cost of doing business in Canada was too high.
The company is now contemplating taking its business and its
high paying jobs to the United States where it can use the NAFTA
agreement to gain access to Ontario and Manitoba. Does this make
any sense? This kind of nonsense has to end and it must end
quickly.
(1320 )
I could literally go on for hours citing examples of unjust trade
restrictions within Canada. They would all draw the same
conclusion: we must do something to rectify the situation.
Patriotism should not be the sole rationale for doing business inside
Canada.
With regard to internal trade barriers many companies have
stated that the only reason they are staying in this country is that
they are patriotic Canadians. One after another have said that
patriotism can only go so far and that if things do not change, these
companies will move their businesses to the United States, Mexico
or elsewhere.
I will now summarize the government's approach to budgets to
date. In the 1994-95 budget the Liberals tried to grow out of debt
through make work projects. In the 1995-96 budget the Liberals
tried to tax their way out of debt through payroll and gasoline taxes.
The 1996-97 budget is really a do nothing budget intended to
2993
stupefy the masses into believing that all is fine and that the
problem has been solved.
I will conclude by reading an excerpt from the C.D. Howe study,
``Deficit Reductions-What Pain, What Gain''. This study should
be required reading for anyone who believes that we can first, grow
our way out of debt; second, tax our way out of debt; third, do
nothing about our fiscal crisis. The study concludes by stating that
short term sacrifice for deficit elimination can yield a rich, long
term return.
The long term benefits of balancing budgets in a quick and
efficient manner will accomplish the following: First is income and
job security. A balanced budget will put an end to the downward
spiral that we have seen in take home pay over the past 20 years.
Second, it will provide tax relief. By controlling spending and
balancing the federal budget, taxation levels would be reduced in
conjunction with deficit and debt reduction. Third is social
program security. By ending the continual increase in interest
payments on the debt, tax dollars could be directed to maintaining
social programs such as health, education and pensions which are
so important to Canadians.
The answer is quite clear. The environment for job creation can
be achieved through the taxpayers budget or a similar approach. It
also will require dealing with and eliminating internal trade
barriers. This can and must be done.
Through my speech today I have shown that the 1996-97 Liberal
budget and the Liberal government's entire approach to fiscal
reform is ineffective and does not respond to the needs of
Canadians which have been stated quite clearly across the country.
In this budget Canadians wanted job creation, not vote creation. I
believe that Canadians can see through the statements of the
finance minister and others that the problem has been solved. The
budget will not end up being a vote creator.
The Deputy Speaker: The Chair had an indication that another
colleague wished to speak but I do not see him in the House.
Is the House ready for the question?
Some hon. members: Question.
The Deputy Speaker: Is it the pleasure of the House to adopt the
motion?
Some hon. members: Agreed.
Some hon. members: No.
The Deputy Speaker: All those in favour of the motion will
please say yea.
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it.
And more than five members having risen:
(1325)
[Translation]
The Deputy Speaker: Call in the members.
And the bells having rung:
The Deputy Speaker: Dear colleagues, the recorded division on
the motion stands deferred until 6.30 p.m. today.
* * *
[
English]
Hon. Paul Martin (Minister of Finance, Lib.) moved that Bill
C-36, an act to amend the Income Tax Act, the Excise Act, the
Excise Tax Act, the Office of the Superintendent of Financial
Institutions Act, the Old Age Security Act and the Canada Shipping
Act, be read the second time and referred to a committee.
Mr. Barry Campbell (Parliamentary Secretary to Minister of
Finance, Lib.): Mr. Speaker, I welcome the opportunity to begin
debate in support of Bill C-36, the Income Tax Budget Amendment
Act, 1995. I will begin my remarks with a few observations about
the context of the tax measures we are proposing. To do that I must
revisit the challenges the country faced and the expectations of the
people we represent when the 1995 budget was introduced.
[Translation]
Then-as now-, Canadians wanted their governments to spend
their money and to make savings in a sensible way, according to
their values. And their values were undeniably reflected in the
principles guiding our budgetary decisions.
These principles, underlying the bill being debated today, were
set forth by my colleague, the Minister of Finance, in his budget
speech.
The first principle stated that the government had to put its house
in order. In other words, the budget had to focus on reducing
program spending, rather than increasing taxes.
Another principle emphasized the need to be fair, fair toward the
various regions of this country and its different citizens.
[English]
The record shows that we kept faith with Canadians. For the
three year period that was the focus of last year's budget, from
1995-96 to 1997-98, the government has secured almost $7 in
spending cuts for every dollar in new taxes. The spending reduc-
2994
tions that were set out for the three year period total $25.3 billion
and we took care to ensure that the burden was shared fairly.
Some $16.9 billion, or two-thirds of the total cuts, are to come
about because of program review actions announced in the 1995
budget. This top to bottom re-evaluation of what government does
and how government spends is now well under way and reflects an
important reality of the 1990s.
In today's world where resources are limited, there is no
question that government must change. If we are to do a better job
of meeting key priorities we must reduce our presence in areas
where others can do the job better.
The results of our actions in all three budgets introduced by this
government speak for themselves. In 1993-94 federal program
spending stood at $120 billion, or almost 17 per cent of GDP. By
1998-99 the money we spend on programs will be down to $105.5
billion, or 12 per cent of GDP.
From the start we set out tough deficit targets and we are firmly
on track to meeting them. Our milestone is a deficit equal to 3 per
cent of GDP for this fiscal year and 2 per cent next year.
[Translation]
As I mentioned previously, most of our decisions focused on
reducing expenses. But, given the size of the challenge, we could
not avoid a reform of the tax system.
In the budget speech, the minister pointed to the fundamental
principle guiding our tax policy: taxes involve more than just rates,
there is also the question of fairness.
With this in mind, we introduced a number of tax measures
increasing the fairness of the system. We did not, however, increase
personal income tax rates. In fact, we have not changed these rates
in any of our three budgets, because we are well aware of the deep
exasperation felt by many Canadian taxpayers.
(1330)
I would like to briefly describe a number of measures we are
proposing in the bill before us today.
I am sure all members will agree that fiscal equity begins with
the collection of all taxes payable. We cannot allow some
Canadians to evade their duty at the expense of other taxpayers.
[English]
Measures in this budget will protect the collection of source
deductions made for income tax, Canada pension plan
contributions and unemployment insurance premiums. Let me
explain.
There have been cases where taxpayers are encouraged or even
forced by third parties in a position of influence not to remit source
deductions and similar withholdings. This can happen, for instance,
where a secured creditor of a taxpayer in financial trouble controls
the disbursements of the taxpayer's business. In an attempt to
recoup its own losses, the creditor permits the payment of wages
but refuses the remittance of source deductions and similar
withholdings.
To protect source deductions in these and similar circumstances
the government proposes amendments that would make such
secured creditors liable to pay unremitted source deductions, along
with any interest and penalty charges, just as the taxpayer is liable.
It is also proposed to allow Revenue Canada to exchange
business name and address information with other federal
departments and the provinces when they adopt the business
numbers to identify corporations, partnerships or certain
associations of taxpayers. This will allow federal departments and
provinces to cut duplication, simplify business registration and
develop joint business services. From the business person's point
of view it will reduce the cost of compliance and give access to
more effective government services.
[Translation]
I would now like to talk about the measures in this bill that
propose changes to the tax system itself, changes that will make the
system fairer. For example, we propose to change the tax system on
investment income of private holding companies by eliminating
the attractive deferral opportunities that existed until now.
Also, the current film incentive measure will go from the present
tax shelter, which profits high income investors, to a new
refundable credit offered directly to Canadian film producers.
[English]
The government is also acting to eliminate tax advantages
flowing from family trusts. This includes repealing the previous
government's decision to allow deferral of the 21-year rule.
I will now turn to other tax issues. First, measures in this bill
affect the tax assistance the government provides to Canadians to
encourage them to save for retirement. In last year's budget it was
announced that the contribution limit for RRSPs would be reduced
to $13,500 for this year and next, then allowed to rise incrementally
to $15,500 by 1999.
In that budget it was also announced that the contribution limit
for money purchase registered pension plans would be reduced to
$13,500 for this year, then rise incrementally to $15,500 by 1999.
However, in this year's budget the government announced that the
contribution limits would instead be frozen at $13,500 for another
six years, that is until 2003 for RRSPs and 2002 for money
purchase plans.
2995
The legislation before us implements the changes to the
contribution limits announced in the 1995 budget. The further
freeze in the limits that was announced this March will be dealt
with at a future date.
As well, under this legislation, the amount of over-contribution
allowed to an RRSP without being subject to the one per cent per
month tax penalty will be cut from $8,000 to $2,000. There are,
however, some traditional measures to accommodate taxpayers
with prebudget over-contributions below the old limit but above
the new one.
The 1995 budget changes will being the limits closer to the
original pension reform target of providing tax assistance on
earnings up to two and one-half times the average wage. The
subsequent 1996 changes will bring this target down to two times
the average wage, allowing us to better target this assistance to
those who need it most, modest and middle income Canadians,
while limiting the cost to the government and all its taxpayers.
(1335 )
As we consider the Canada of the future, in the early decades of
the next century, there can be no question about the need to
encourage retirement savings. In so doing we help today's wage
earners prepare for their eventual exit from the workforce and thus
avoid a too heavy reliance on public pension and income support
programs in years to come.
Let me pause for a moment and mention one measure being
introduced which affects today's higher income seniors. These
individuals must repay part of the old age security benefit to the
extent that their income exceeds an indexed threshold of $53,215
for this year. Through Bill C-36, instead of having them receive the
full benefit and then make a repayment when they file their income
tax, the government proposes to reduce the benefit before it is sent
out. I want to stress that the level of the clawback is not being
changed with this measure but simply how it is implemented.
Let me now turn to another issue which I wish to discuss in some
detail, the action to eliminate the deferral of tax on business
income. Under current law unincorporated business owners can use
a fiscal year that does not correspond to the calendar year. If the
year end is, for example, January 31, then all income for the
remaining 11 months is added to next year's taxable income.
Needless to say, taxpayers taking advantage of this feature enjoy a
significant benefit over others. This approach runs counter to the
general rule for taxpayers that income is taxed in the year in which
it is earned.
To remedy this situation and to treat all taxpayers as equally as
possible, a new rule was announced that would require all sole
proprietorships, professional corporations and partnerships to have
a fiscal year end of December 31. This proposal, however, came in
for considerable criticism from many business people who are
affected by the change and from members of this House.
The government has listened to them. It recognizes that some of
the comments made to us were valid. Many businesses are of a
seasonal nature and a fiscal year end of December 31 imposes
hardships on them. Operators of a ski hill, for example, would
prefer to focus on their business in the winter months, not on their
accounting.
Second, a uniform year end would see much of the demand for
accounting services concentrated in December and the few
following months. In contrast, the variation of year ends allowed
by the current system spreads the work more evenly throughout the
year to the benefit of small businesses as well as their accountants.
The response has been to provide an alternative method of
calculating income, one that addresses the goal of treating
taxpayers as consistently as possible and at the same time allowing
small business to retain a fiscal year end that reflects their needs.
Under this method taxpayers with a year end other than
December 31 will have to adjust their income to take account of
earnings between their fiscal year end and the end of the calendar
year. There will be, of course, a transitional provision so taxpayers
can allocate additional income from 1995 to future tax years. This
alternative method will be available to individuals carrying on a
business and to partnerships where all members of that partnership
are individuals.
Let me also mention in passing that the decision to allow
individuals to retain a fiscal year that does not end on December 31
has implications for their remittance of collected GST amounts.
Individuals will continue to have the option of adopting their fiscal
year for GST purposes.
The third area I wish to discuss is changes the budget made to
corporate income tax rates. The government announced an increase
in the large corporation tax by 12.5 per cent. As well, it proposes to
raise the corporate surtax on profits from 3 per cent to 4 per cent.
Taken together, these two measures will generate an extra $260
million annually.
The goal is to ensure that big companies contribute a more
equitable share of the burden required to bring the deficit down. A
temporary tax is being imposed on the capital of large deposit
taking institutions, including banks. From February 27, 1995 to
October 31, 1996 the budget anticipated this would raise $100
million over the covered intended period. Life insurance
companies, which already pay an additional capital tax, would not
be subject to this temporary surcharge.
Finally, let me mention one amendment that is not targeted at the
fiscal environment but is targeted at the natural environment. The
legislation acts to eliminate the current limit on the charitable
donations credit for the donation of ecologically sensitive land. The
current limit is 20 per cent of income, a level that may be a
2996
disincentive in some cases where the value of the land is high
relative to the donor's income.
(1340 )
This measure reflects the fact that the government appreciates
not only the vital importance of environmental action, but also the
growing importance of the charitable sector in Canadian society. In
this year's budget, for example, a number of additional measures
were announced that will be introduced in the months ahead.
[Translation]
The tax changes we are proposing in this bill are fair and
equitable. They are totally in accordance with the principles we
have set for ourselves to give direction to the tax policy. These
principles, as I am sure members are well aware, reflect the values
and expectations of Canadians.
As elected representatives of the Canadian people, we would fail
in our duty if we departed from these principles. That is why I urge
my colleagues to join me in supporting this important bill.
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, I am happy to participate in the debate at second reading
of Bill C-36, an act to implement certain provisions of the
budget-not the last one tabled by the Minister of Finance, but the
1995 budget.
First of all, regarding the government's behaviour, it is quite
remarkable that, more than one year after tabling a budget, the
government reintroduces provisions that had been announced at
that time while focusing on beneficial measures from the 1995
budget, which may appear small but which are in fact magnified a
thousand times. This amounts to doing the same thing twice so as
to heap praise on the government and the Minister of Finance. I
think the secretary of state has become an expert on this.
In the next few minutes, I will go over four of the measures in
this bill which are especially important. I will talk about two
positive measures on which the official opposition agrees with the
government, and about two measures which, in our opinion, are
highly detrimental.
I will first approach Bill C-36 in a general way. When one
compares the measures in this bill with the responses given by the
Minister of Finance since the 1995 budget, it is like water and fire,
like night and day.
Since the 1995 budget and again recently, the Minister of
Finance has often told us: ``Since the 1995 budget, and even since
the 1994 budget, I have put in place tax reform measures to make
the Canadian tax system more effective, to correct the inequity, the
imbalance between businesses that pay no taxes and those that pay
taxes every year. Since my 1995 budget in particular, I have taken
steps to correct inequities between individuals who pay too much
tax and some businesses that do not pay any''.
We in the official opposition say again to the Minister of Finance
that he has done nothing to make the Canadian tax system more
equitable. He has done nothing to make global or specific
improvements to the Canadian tax system since taking office, since
his first budget in 1994 even. He has done nothing to close tax
loopholes, and this lack of action, this laissez-faire attitude is
apparent in Bill C-36.
Since this bill contains measures relating to tax deferral and
corporate income tax, why did the minister not take the
opportunity, in preparing to table his budget, to truly reform our tax
system, as we have been requesting ever since we were elected to
this place?
If those are the measures on the basis of which he boasts day in
day out to have ``plugged the tax loopholes'', it is clear-plain as
day, as we would say back home-that it makes no sense
whatsoever. Referring to tax deferral measures, he claimed to have
fixed the problem, rectified the inequity in situations where a
corporation could defer tax, perhaps indefinitely, in combination
with accelerated depreciation for instance, so that it never paid a
cent in taxes. He claims to have resolved the problem. He keeps
referring to the 1995 budget.
(1345)
What does the 1995 budget provide for on the particular matter
of tax deferral? According to this budget, any corporation that is
not a business corporation must end its financial year on December
31 instead of carrying income forward 18 or 24 months.
That is not it. If that is the finance minister's basis for stating:
``Indeed, we have managed to ensure that all corporations pay the
tax they owe'', it is skimpy. Very skimpy in fact, as it does not even
meet one tenth of the target the Minister of Finance claims to have
met.
This is so remote from the actual objective that recently, when
the issue of the capital gains tax was raised, the Toronto Star
showed the weaknesses of the Canadian tax system, including
loopholes that were in no way eliminated by the finance minister,
whether through Bill C-36 or even the February 1994 budget. The
Toronto Star wrote that ``a Revenue Canada report''-not a Bloc
Quebecois report, a Revenue Canada report-``released last month
indicated that, in 1991, assets worth some $60 billion-that is a lot
of money, a lot of wealth-left Canada without the department
being able to identify the origin and destination of this money''.
The Toronto Star suspected that these $60 billion worth of
Canadian assets had been secretly transferred to tax havens, thanks
to the permissiveness and flexibility of the Canadian tax system.
Mr. Speaker, we are talking about $60 billion worth of assets.
If this was the case in 1991, if no corrective measures were
taken, if the Minister of Finance only kept telling us that we were
wrong, that the Canadian tax system was good, that it was airtight
and that we could rely on it to prevent capital flight and outright tax
2997
evasion schemes such as the ones mentioned in the Toronto Star,
then we have a problem.
A number of parties, including the major Canadian banks, were
identified as having taken part in this massive tax evasion scheme.
We keep repeating to the Minister of Finance, the Prime Minister
and the former and current revenue ministers that it is not normal
that major Canadian banks have some 46 branches in Caribbean
countries alone, which are considered to be tax havens. It is not
normal that these banks have twice as many branches in the
Caribbean as in the rest of the world.
Now, we learn that, as regards the tax evasion scheme whereby
$60 billion worth of assets left Canada, a finger could be pointed at
the major Canadian banks.
Everyone in Quebec and in Canada knows that the official
opposition energetically accused the government of being too soft
and decried the tax loopholes, by pointing out the opportunities for
the businesses and the banks, as well as some of the richer families
in Canada, to avoid paying their share to Revenue Canada. Even if
the Minister of Finance said: ``You are exaggerating. It all amounts
to a few dozens of millions of dollars'', we now know that billions
of dollars, as stated in a Revenue Canada report, could leave the
country and dodge income tax, that is evade the Canadian tax
system.
We now have the evidence. The Minister of Finance was proud
of his 1995 budget as reflected in Bill C-36. He even told us that
there were no problems.
The government has made quite a few blunders, Mr. Speaker. An
unkept promise about the GST; what amounts even to the most
federalist of Canadians to a $1 billion partisan agreement to buy the
maritime provinces; the many more blunders on constitutional
issues. Now, with flights of capital of such magnitude, we realize
that the Minister of Finance did not improve the tax system. This
all adds up to a lot of bad points for the government.
So much for the overall approach. Let us now examine the more
specific measures.
(1350)
Bill C-36 deals in part with family trusts. The Minister of
Finance is not a fast worker, since it took him more than a year to
implement last year's budget. In 1995, the Bloc Quebecois called
the Minister of Finance a ``stand-up comic'' and said that the
minister was putting up smoke screens.
The Minister of Finance pretended to address an issue that is
close to the hearts of the official opposition members, because it is
quite a scandal, and said: ``We have taken some measures
concerning family trusts''. You can take any measure on any
possible issue and still not do your work, and that is exactly what
the Minister of Finance did in 1995.
He said he was going to amend the rule allowing taxes on assets
held in family trusts to be deferred, a rule that had been amended
by the previous government and that allowed a taxpayer to defer
taxes up to 80 years. Under the provisions of this rule, it was
possible to defer tax on capital gains until the death of the last
exempted beneficiary.
The Minister of Finance told us this would be corrected and we
would go back to the old rules. We were happy, because under the
old rules you had 21 years, which, while not perfect, was better
than 80. At least after 21 years, taxes were paid on billions of
dollars worth of assets that were accumulating in family trusts.
But the Minister of Finance immediately followed this up with
the announcement that the 21 year rule would not take effect until
1999. If you were a trustee, if you had billions, tens of millions,
even hundreds of thousands of dollars in a trust, what would you
do? I ask the question and I will give the answer. I think you would
investigate all the fiscal options open to you with a view to
minimizing the tax you had to pay to Revenue Canada.
The Minister of Finance has given very rich Canadian families
and large businesses, which also use trusts, an opportunity to
analyse all the financial and fiscal vehicles available, and he has
given them four years to transfer their money from family trusts to
other vehicles, or worse yet, outside Canada.
When we voiced our objections, the Minister of Finance said:
``Well, what do you expect, the official opposition is just a bunch of
separatists''. The usual attack, and the usual rhetoric we have come
to expect from this government. There always has to be a scandal
somewhere, something has to happen. Even though we have been
saying and shouting for two and a half years that the government is
losing hundreds of millions if not billions of dollars in taxes, it
always takes a bombshell for the government to finally see the
light.
This bombshell came three weeks ago when the auditor general
said that two family trusts had transferred $2 billion worth of assets
to the United States without paying any taxes on these assets. The
finance minister said that family trusts were not a problem, that he
would deal with that but we had to give him four years to do it. That
meant we had to give Canada's richest families, like the ones that
transferred $2 billion worth of assets to the United States, four
years to find ways not to lose money.
But the ordinary Canadian taxpayers will pay. They are the ones
who will pay for those $2 billion that were transferred to the United
2998
States tax free because of this government's laxness. Taxpayers
will pay, consumers will pay, unemployed people who are the
victims of this government's cuts in the unemployment insurance
fund will pay. It is outrageous.
Considering the sacrifices that ordinary Quebecers and
Canadians are being asked to make, that the real taxpayers who are
supposed to be represented by the members of this government are
being forced to make, we will continue to ask not only that the
issue of the 21 year rule be dealt with, but also that the
appropriateness of maintaining an instrument such as family trusts
at the expense of Quebec's and Canada's real taxpayers be looked
at.
(1355)
A second aspect of Bill C-36 which has something indecent
about it. The Secretary of State was saying this morning ``As a
government, we have met our responsibilities. We have taxed the
major chartered banks. We have levied a special renewable $160
million tax''.
There is a special tax of $160 million on the chartered banks,
banks which have amassed some $5 billion in profits. Yet those
banks, if we can believe a Toronto Star article which reports on the
contents of a Revenue Canada report on tax evasion and refers to
the $60 billion in assets siphoned off to the U.S. and just about
everywhere else, are not paying the federal government, Revenue
Canada, its just dues. They are taking advantage of tax loopholes to
transfer part of their untaxed funds into branch operations,
particularly in the Caribbean. As I have said, there are 46 of these.
It is easy for them to plan their affairs so as to pay the minimum in
taxes.
Mr. Speaker, since you are indicating that I have two minutes
left, I will end with this measure and continue after question
period. The banks are being hit with $160 millions in taxes-a
temporary measure-when, at the other end, there is $60 billion in
tax evasion and $2 billion that went to the United States untaxed
through family trusts.
We should compare the $160 in special tax on the banks to the
billions it is costing Quebecers and Canadians with the restrictions
in unemployment insurance, for example, and with the cuts to
social assistance, post-secondary education and health. I think
Quebec and Canadian taxpayers will realize that this government is
working, but not necessarily in their best interest. It is working
more for big business; for the powerful families, like those that
succeeded in transferring $2 billion through family trusts without
paying tax; and for certain financial institutions, including the
banks. I will return to this in my analysis of Bill C-36.
The Speaker: My dear colleagues, it being nearly 2.00 p.m., we
will now proceed to Statements by Members.
2998
STATEMENTS BY MEMBERS
[
English]
Mr. Stan Dromisky (Thunder Bay-Atikokan, Lib.): Mr.
Speaker, in my riding the residents of Westfort are renowned for
their friendliness and fierce loyalty to their community. In order to
further build on this positive sense of community, Westfort was
chosen for a recent federal-provincial project aimed at increasing
neighbourly ties in small communities.
The three year Neighbourhood Outreach Development Project
wound up recently. As far as the project organizers are concerned,
there is no such thing as too much community goodwill.
A key outcome of this initiative was the construction of the West
Thunder Community Centre. At this centre one will find people of
different ethnic origins and linguistic groups, mingling and
interacting together in harmony. What a model for community
living.
This model demonstrates that our differences are no reason for
division. Instead, diversity can serve to bind us closer together in
peace and harmony.
* * *
[
Translation]
Mr. Bernard Deshaies (Abitibi, BQ): Mr. Speaker, as reported
in the
Journal de Montréal, the victory of the Granby Prédateurs
means that Quebec major junior hockey has gained respectability
and credibility. People will no longer say that Quebec teams do not
measure up to western or Ontario teams. People will no longer say
that they are unable to go all the way to the top.
The Bloc Quebecois salutes the Granby Prédateurs on the
occasion of their victory. The obvious support people gave the club
is proof of the pride they felt and the gratitude they wanted to
express after such an amazing season.
As the coach of the team, Michel Therrien, said, this victory is
good for the whole of Quebec.
* * *
[
English]
Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, one of
the parties running in the B.C. election is calling for an end to the
gold plated MLA pension plan, for victims rights to be put ahead of
the rights of criminals, for dangerous young offenders to be
upgraded to adult court, for free votes in the legislature on
everything but budget bills, initiative, referendum and recall, for
two year balanced budget legislation, for pay cuts for politicians
2999
who overspend, for opposition to gun control Bill C-68 and for the
reworking of the Nisga'a land claim deal.
(1400 )
These certainly sound like Reform policies, and they are, but
they are also listed in the B.C. Liberal campaign literature. No
wonder the member for Halifax and many of her caucus colleagues
have been so critical of B.C. Liberals. They are the most un-liberal
Liberals in the country. They are actually promising what the
people want.
The last decaying bastion of tax and spend liberalism is the one
in this House. For the sake of taxpayers let us hope its passing is
swift.
* * *
Mr. Chris Axworthy (Saskatoon-Clark's Crossing, NDP):
Mr. Speaker, as the winds of change conference wrapped up its
efforts to unite the right this weekend in Calgary, it seemed
shameful to me that the Prime Minister and his Liberal colleagues
were not invited to the party. Surely their slash and trash approach
to social and fiscal policy over the past three years is more than
equal to the price of admission.
If anything, the Prime Minister's relentless march to the right
should have earned him the role of guest of honour at that winded
exchange conference and neo-conservative fun fest.
While Tories and Reformers spent the weekend only talking
about tearing the country apart, the Prime Minister has been
actually doing it. He has gutted social programs, health care and
UI. He has broken promises on GST and the NAFTA. Last week at
a Liberal fundraiser he admitted there was no hope in sight for the
million Canadians who are unemployed.
Do not despair, Mr. Prime Minister, Canadians recognize that
you belonged at that conference. I am sure your invitation got lost
in the mail.
* * *
Mr. Peter Adams (Peterborough, Lib.): Mr. Speaker, there is
widespread belief in Ontario at present that the oil companies are
gouging consumers through exorbitantly high gas prices. Prices in
our communities go up and down, mainly up, all at the same time.
Why, people ask, if each service station has different amounts of
already paid for gas in its tanks do prices change at the same time?
In Peterborough there have been demonstrations at gas stations
to no avail.
It is time something was done about this. I am a great believer in
keeping government interference in business to a minimum.
However, it seems my constituents are being manipulated by huge
corporations.
I call on all members to support Bill C-267 which will control
the way companies can change gas prices. I also support the MPs'
appeal to the competition bureau.
* * *
Mr. Ron Fewchuk (Selkirk-Red River, Lib.): Mr. Speaker, it
was an honour and a pleasure for me to present the Prime
Minister's awards for teaching excellence in science, technology
and mathematics to the Edward Schreyer School in Beausejour,
Manitoba, and to teacher Judith Hattie.
This award recognizes her for the hard work she did which had a
major impact on her students' performance in the fields of science,
technology and mathematics.
Excellence in these areas is essential to building a better
Canadian economy. Teachers like Judith play a critical role in
shaping the attitudes of students and in preparing them for the
career opportunities in the global economy of the future.
* * *
[
Translation]
Mr. Mark Assad (Gatineau-La Lièvre, Lib.): Mr. Speaker,
some time ago, the auditor general drew the attention of lawmakers
to decisions regarding the transfer to the United States of funds
worth at least $2 billion which were held in family trusts in Canada.
These 1991 decisions did not reflect the legislator's intent. The
legislator's intent is first and foremost to protect the tax basis
against possible erosion. This was not the case. Regardless of
diverging opinions and decisions, the fundamental principle which
is the protection of Canadian taxpayers was clearly set aside.
The operation which frustrated the legislator's intent and the
lack of documentation and analysis regarding the adoption of such
significant positions fly in the face of the principle of tax fairness.
We are concerned and perplexed by the non-publication of these
decisions over at least the past four years, and this will have to be
looked into.
* * *
[
English]
Mr. Mike Scott (Skeena, Ref.): Mr. Speaker, crab fishermen in
New Brunswick were justifiably outraged when they learned the
fisheries minister planned to reallocate a portion of their quota to
3000
groundfishermen. This is a classic case of robbing Peter to pay
Paul. More to the point, the minister has graphically demonstrated
why fisheries in Canada are in trouble. Political decisions override
sound management of the resource and political reallocation on
both coasts undermines industry viability.
Does the minister not realize his half baked make work program
at the expense of crab fishermen just creates instability? How long
will it be before Canadian taxpayers are asked to bail out another
failed fishery?
(1405)
It is long past time that politics and fisheries management were
surgically separated in Canada. Canada's commercial fishery is not
some elaborate social program; it is a business and it ought to run
like a business.
As long as politics overrides science and drives management
decisions, the biological integrity of the resource is threatened and
economic failures will continue to be the hallmark of the federal
government.
* * *
[
Translation]
Mrs. Christiane Gagnon (Québec, BQ): Mr. Speaker, on
behalf of the Bloc Quebecois, I want to emphasize the outstanding
courage displayed by the 8,000 or so people who met yesterday in
Burma to attend the congress of the leading opposition party
against the ruling junta, the National League for Democracy, led by
Aung San Suu Kyi, who won the 1991 Nobel Peace Prize.
At least 238 of the 300 delegates who were to attend the congress
are said to have been detained by military authorities in an attempt
to prevent the meeting from taking place. Note that Ms. Suu Kyi
was imprisoned and put under house arrest for nearly six years after
winning the 1990 democratic election.
We salute the extraordinary determination of this woman and
encourage her to carry on her fight for democracy, freedom and
human rights.
* * *
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Mr. Speaker, I
wish to congratulate CKSB, Manitoba's French language radio
station, on its 50th anniversary.
On May 27, 1946, at 6 p.m., CKSB, a radio station financed by
the generous donations of francophones in Manitoba, went on air
for the very first time. In 1973, CKSB joined the CBC network.
After 50 years of existence, CKSB remains an indispensable part of
our community, a tool that unites us and helps us to know one
another better.
I applaud CKSB and all the members of its team, past and
current, for their dedication and their contribution to the
Francophonie in Manitoba and Canada.
* * *
[
English]
Mr. Ovid L. Jackson (Bruce-Grey, Lib.): Mr. Speaker, I am
pleased to inform the House that last week was aboriginal
awareness week.
Aboriginal awareness week was developed by the human
resources employment equity section of Agriculture and Agri-Food
Canada in November of 1991. It was first celebrated in May 1992
with the participation of 12 other federal departments in the
National Capital Region, in part to highlight the contribution
aboriginal peoples played within the Canadian federal public
service.
This year the Treasury Board secretariat and the Public Service
Commission collaborated on two events in recognition of this
week. The first was a panel discussion on May 21 where two
aboriginal speakers presented their perspectives on how aboriginal
peoples view themselves as members of and contributors to
Canadian and western society in retaining their traditional heritage.
The second was a presentation by the White Eye Singers from
Walpole Island on Friday, May 24 where the audience in the lobby
of L'Esplanade Laurier in Ottawa were treated to both traditional
and more contemporary aboriginal dances.
Aboriginal awareness week provides us with an excellent
opportunity to increase our-
The Speaker: The hon. member for Etobicoke North.
* * *
Mr. Roy Cullen (Etobicoke North, Lib.): Mr. Speaker, the
Canadian International Development Agency has concluded a
five-year agreement with McGill University's faculty of education.
The purpose of this agreement is to assist the national and
provincial governments of South Africa to develop an improved
capacity for management and governance in education.
Spearheading this initiative is a South African task team on
education management development which is currently visiting
Canada. Its members will be meeting with relevant Canadian
institutes and individuals in order to develop a national strategy for
sustainable and responsible education management in South
Africa.
I take this opportunity to wish the task team members every
success in their efforts and to commend McGill University, the
University of Toronto, OISE, the Learning Consortium and the
many other institutes involved for their assistance in this important
venture.
3001
[Translation]
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, of all the
cities in North America, Montreal is the one that allowed the
talented Jackie Robinson to become the first black player in the
history of major league baseball. In 1946, Jackie Robinson signed a
contract as a star player with the Montreal Royals.
Fifty years ago, the people of Montreal gave a warm welcome to
the Robinson family. Rachel Robinson, the widow of the famous
player, remembers. Last weekend, she said she was happy to be
back home in Montreal, that Montreal ``was a city where one felt
safe, a city that has always treated us with respect and welcomed us
with open arms''.
(1410)
She added: ``The fight against racism has made some progress
but there is still a way to go. I am 73 years old and I have not lost
confidence in the human race''.
Thank you, Jackie and Rachel Robinson, for your contribution to
the history of mankind.
* * *
[
English]
Mr. Leon E. Benoit (Vegreville, Ref.): Mr. Speaker, Canadian
farmers get $2,500 more for a truckload of grain in the United
States than they get in Canada. Unfortunately the government
through the Canadian Wheat Board prevents them from taking
advantage of this higher price.
Working for farmers, the Alberta government is proposing to
buy farmers grain for $1 a load in Alberta and sell it back to
farmers for $1 a load across the border in the United States, all this
to get around the Canadian Wheat Board monopoly.
The Prime Minister and the minister of agriculture both
promised during the election campaign to hold a farmer plebiscite
on ending the wheat board monopoly. The government still has not
honoured this election promise.
First Sheila Copps, then the finance minister, then the Prime
Minister and now the minister of agriculture all say read the fine
print in the red book but forget what we said out on the campaign
trail. Are Canadians supposed to believe the red book promises or
the promises made during election campaigns? Canadians are
starting to believe the answer is neither.
Mr. George Proud (Hillsborough, Lib.): Mr. Speaker, late last
week a tragedy was narrowly averted. It would have affected each
and every Canadian from coast to coast. I am not talking about a
natural disaster or a horrific accident, but to some the effects would
have been far worse.
Such a tragedy would have meant no televised hockey playoffs
and likely no televised summer Olympics. To sports fans
nationwide it would have been devastating. Thanks to the courage
and goodwill of everyone involved a strike at the CBC was
avoided.
To hon. members of the House I suggest we stand to thank the
negotiators of the CBC, the three unions involved, the Canadian
Media Guild, the National Association of Broadcast Employees
and Technicians, the Canadian Broadcasting Employees Union,
and finally, lest we forget, the ever important and unrelenting
efforts by the Federal Mediation and Conciliation Service,
especially its director, Warren Edmondson, for providing the
bridge between the CBC and its unions.
Well done, folks.
* * *
[
Translation]
Mr. Nick Discepola (Vaudreuil, Lib.): Mr. Speaker, the people
of Quebec are increasingly concerned about the PQ government's
recent policies relating to the collection of money owed to the
government.
The many mechanisms and procedures recently announced by
PQ ministers and members in order to quash the underground
economy and stop tax evasion clearly show that, to the PQ
government, all taxpayers are potential cheats.
Because of their obsession with the underground economy and
with tax evasion, the separatist ministers are taking steps that
seriously undermine the basic principles of privacy and
confidentiality prevailing in this country.
The men and women of Quebec are honest citizens who deserve
greater respect and regard than the kind of inquisition regime the
PQ is trying to set up in Quebec.
* * *
[
English]
Mr. Jim Abbott (Kootenay East, Ref.): Mr. Speaker, on April
Fool's Day of this year Parks Canada announced that residents
living in parks would pay a $38 a year fee so their families could
live in the parks.
3002
Banff mayor Ted Hart said the town participated in almost two
years of federally initiated meetings, round table sessions aimed
at developing a common vision for Banff's future, in the hopes
that Parks Canada was adopting a more open consultative
approach with the residents, ``but this fees thing indicates just the
opposite''.
Now Parks Canada has changed its mind and will not collect fees
this year. This fee mix-up does not stop here. Parks Canada also
instituted a $70 annual fee for families April 1 and persists in
trying to collect it. However, it is making deals with bus companies
and tour groups, which clearly indicates Parks Canada does not
have a clue what it is doing or where it is going with the collection
of park entry fees.
Access to Canada's parks must be affordable for all Canadians.
Clear up this fee mishmash now.
* * *
Mr. Paul Steckle (Huron-Bruce, Lib.): Mr. Speaker, it is with
great pleasure that I rise in the House today to recognize the recent
efforts and the accomplishment of the Royal Canadian Legion,
Harry B. Miner, Branch 140 in Clinton, and of the Huron County
Museum which is also in my riding.
Recently my colleague, the Parliamentary Secretary to the
Minister of National Defence, and I were in Goderich for the
official opening of a new display at the Huron County Museum.
(1415)
The display is a result of an arrangement made between the
museum and the Legion whereby two medals, the Victoria Cross
and the Croix de Guerre, awarded during the first world war to
Corporal Harry B. Miner and currently owned by the Legion, will
be placed on permanent public display.
I acknowledge the hard work and commitment invested in this
endeavour by the members of the Clinton Legion. Their efforts
have brought about the recognition that late Corporal Miner's
ultimate sacrifice truly deserves. They have also taken an
important step toward better educating local residents and visitors
alike of the rich history of the county of Huron.
_____________________________________________
3002
ORAL QUESTION PERIOD
[
Translation]
Mr. Michel Gauthier (Leader of the Opposition, BQ): Mr.
Speaker, in his throne speech the Prime Minister clearly announced
his government's intention to bring down specific proposals for
renewing Canadian federalism, and those commitments have been
repeated by government ministers on various occasions.
In keeping with the commitments made in the throne speech,
what proposals does the government intend to submit to the
provincial first ministers at the June 20 meeting?
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, the agenda is not yet set, but it will be shortly.
Mr. Michel Gauthier (Leader of the Opposition, BQ):Mr.
Speaker, the minister's reply is again evidence of the government's
great talent for improvisation, particularly as regards meeting
promises made before the referendum and in the throne speech. I
will just point out that in this case, rather a long time later, six
months, they are still trying to set an agenda.
Since the Minister of Intergovernmental Affairs' travels to the
various provincial capitals have not resulted in any consensus
whatsoever for the June 20 meeting, what basis is the government
planning to use for its proposals?
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, I do not understand why the Leader of the Opposition
is jumping to conclusions. The agenda will be known shortly and
can then be debated.
Mr. Michel Gauthier (Leader of the Opposition, BQ): Mr.
Speaker, will the minister admit on behalf of the government that,
as long as the government is not clear in what it is saying, and as
long as they use improvisation as their strategy, any meeting with
the first ministers aimed at trying to reach agreement is doomed to
failure, because unfortunately the federal government does not
know where it is headed?
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, the throne speech clearly established the direction the
Government of Canada intends to propose to Canadians. It is the
direction of a more modern federation, one which works even
better that at present, although it will be hard to better a country
that is one of the best run countries in the world.
It can be improved, however, by building on its strengths, the
strengths of a federation which will clarify the roles between levels
of government, a federation which will work even better for all
Canadians. And that is the orientation clearly set in the throne
speech, which the Leader of the Opposition is welcome to reread.
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, this government continues to speak double talk. A few
years ago, the Prime Minister wrote that he was betting on
democracy and that, if he lost, he would abide by the verdict of the
people of Quebec. But here we have his Minister of Intergovern-
3003
mental Affairs talking of using other legal means, such as recourse
to the Supreme Court, to oppose the will of the people of Quebec.
How does the Minister of Intergovernmental Affairs explain this
double strategy: on the one hand, a cloying speech to announce the
upcoming first ministers' conference, and on the other, the threat of
recourse to the Supreme Court in order to restrict Quebecers and
limit their right to determine their future even more?
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, there has never been any question of preventing the
people of Quebec from deciding whether they want to stay in
Canada, as we would like, or leave it. At issue is Quebec's claim
that it can act unilaterally, set and change at will the way the law is
applied.
The basic issue is whether they are acting within the law.
(1420)
I have a quote for the hon. member: ``We are a country in law.
Canada and Quebec are not banana republics. There is the
Constitution, there is international law, and we have all been
elected to defend the law''. This quote is taken from a debate in the
National Assembly on May 19, 1994 and was made by the Leader
of the Opposition at the time, Jacques Parizeau.
My question for the member is this: ``Does he want to turn
Quebec and Canada into banana republics?''
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, I would ask the minister to answer our questions and not
to ask us questions. Things might be more clear.
The Minister of Intergovernmental Affairs even raised the
possibility of terminating the Churchill Falls contract between
Newfoundland and Quebec, by throwing the switch, as he put it so
well.
Will the Minister of Intergovernmental Affairs acknowledge that
his own irresponsible, antagonistic and in fact banana-republic
style remarks, form a very poor backdrop to the proposed
constitutional conference where the Prime Minister says he wants
to discuss harmony in Canada's future?
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, see how the opposition twists words. I wanted to
make the point that the only way for a government to ensure that
order, justice and law are respected is to respect them itself.
Anyone outside the law is not in a good position to insist others
respect it.
This is why I gave the example of one province that, as
compensation for the huge prejudice it considered it had suffered
from being cut off from the rest of the country, could ask a
government it considered outside the law to comply with it,
otherwise it would consider contracts signed with this government
null and void.
* * *
[
English]
Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, in the
1993 election this Prime Minister said about Kim Campbell and the
Tories: ``Their priority is clear. They want to create jobs for the
year 2000. For us, the priority is to create jobs in 1993, right now.
We will start in November''.
During his trip out west last week, the Prime Minister said that
Canadians are probably going to have to live with high
unemployment and less job security. Did the Prime Minister ever
intend to keep his election promise of jobs, jobs, jobs, or was it like
the GST, just more Liberal rhetoric designed only to get them
elected?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, it
may well be the hon. member is not aware of the job creation
numbers in which case she might want to look at them before she
asks questions. Since October 1993 there have been 336,000 new
jobs created in this country, all of them in the private sector and
mostly full time jobs. There will be further statistics to come in the
answer to the supplementary question.
Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, it is one
thing to talk about jobs created. I wonder how many were lost to
balance that out.
The finance minister can spout off all he likes but Canadians
know the real numbers in terms of unemployment: 1.4 million
Canadians are unemployed; 30 per cent of Canadian workers are
underemployed; and one in four Canadians are living in fear of
losing their jobs.
The Prime Minister's statement about perpetually high
underemployment and unemployment is simply an admission of
failure. That should sound familiar because that is exactly what he
told Kim Campbell when she said underemployment and
unemployment will live with us until the year 2000.
I ask the Prime Minister and the finance minister, in this latest
flip-flop, is such high unemployment the flip or just the flop?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker,
there has been a decline in the unemployment rate. It has come
down 1.8 per cent since we have taken office. This is despite the job
losses that have occurred at the federal, provincial and municipal
government levels. There has been substantial job creation in the
private sector. The government's policies are working. If anybody
needs any further proof, it is that in the five months since the turn
of the year, over 170,000 new jobs have been created.
3004
(1425 )
Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, the
truth is that this government has broken one promise after another
since it was elected. The GST was supposed to be scrapped but
oops, that was a mistake. It is still with us. Jobs, jobs, jobs were
supposed to be created but the reality of the numbers are that 1.4
million Canadians are still unemployed. The Prime Minister says
Canadians are simply going to have to learn to live with it.
Will the finance minister admit that he has failed and
unfortunately Canadians are just going to have to learn to live with
it?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker,
there is nobody on either side of the House who takes joy in the fact
that the unemployment rate in this country as in many other
industrial countries is too high.
The fact is the hon. member has been given numbers which
clearly demonstrate that what she should really do is ask her
questions spontaneously and not prepare her supplementaries
before she comes into the House.
The real question is what would have happened if the Reform
Party policies had been put in place? We would have had the
decimation of the social safety net and the decimation virtually of
every positive government program. What would the
unemployment rate have been with the policies of the Reform Party
which would eviscerate this government's capacity to create jobs
and give Canadians a chance?
We are very proud of our record. On the weekend the Reform
Party once again called for massive cutbacks in social assistance
and massive cutbacks in the government's ability to help
Canadians. One hesitates to think of what kind of country we would
have if that bunch ever came into power.
* * *
[
Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, since the federal government announced the $1 billion
agreement reached with the three maritime provinces concerning
the GST, protest has been growing stronger, particularly in Quebec,
Ontario and Alberta. While federal-provincial relations are
deteriorating over this issue, and many others, the Minister of
Finance stubbornly refuses to make the details of the agreement
public.
My question is for the Minister of Finance. Will he lift the veil of
secrecy surrounding the details of the agreement with the maritime
provinces, so that, at last, we can all know how and at what price
he managed to reach this partisan agreement regarding the GST?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker,
the details of the agreement are well known. We released a
statement explaining all the major points of the agreement.
We are now negotiating the final agreement, which is not yet
ready. I can assure you that, as soon as the agreement is ready, it
will be submitted to the House.
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, it is not right for the federal government to pay almost $1
billion to the maritime provinces, with taxpayers' money, without
providing details on anticipated revenues, harmonizing costs and
the impact of expanding the tax base to include services. It does not
make sense. This is the information that the Quebec government
has been asking since the very beginning.
I think the Minister of Finance made a mistake. He may have a
chance to correct it. Why does he not delay any decision on the
GST until the next finance ministers' meeting, on June 18? He will
then be able to make, in concert with the provinces, a good,
transparent and fair decision on the harmonization of the GST, at
no cost for Canadians.
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker,
the details of the impact to which the hon. member is referring
were submitted by the Atlantic provinces. If the member wants to
know these details, I am sure he can ask the provinces. I also want
to say that, the other day, I confirmed that the whole issue of tax
and sales tax harmonization will be on the agenda when finance
ministers meet in June.
* * *
[
English]
Mr. Ian McClelland (Edmonton Southwest, Ref.): Mr.
Speaker, my question is for the Minister of Human Resources
Development.
Last week in Calgary the Prime Minister said that high
unemployment was systemic and it is the result of the global
economy.
On behalf of the Prime Minister, would the Minister of Human
Resources Development tell the House why high unemployment is
the result of the global economy?
(1430 )
Hon. Douglas Young (Minister of Human Resources
Development, Lib.): Mr. Speaker, I thank the member for his
question and I welcome him into his new role. I want to say with all
humility that if I were able to answer that question I probably
would be in a place other than this and it would be a lot higher up
than this altitude.
3005
I have just come back from the OECD where countries like the
United Kingdom, France and Italy wondered about the very same
question. We in Canada are faced with a rate of unemployment
of 9.6 per cent. It is far too high. We all agree on that. Other
countries in the G-7 for example suffer from higher rates of
unemployment and are faced with even greater challenges as they
try to respond to the global environment we all have to operate
in.
We must all work together. I want to give credit to the provinces
as well as the Minister of Finance. The direction we are going in
Canada has certainly taken us to a point where we can now say that
we have reduced the unemployment rate by some 2 per cent or
more in the last couple of years. We still have a long way to go but
unlike a lot of other countries, we are going in the right direction.
Mr. Ian McClelland (Edmonton Southwest, Ref.): Mr.
Speaker, that is all well and good but it begs the question: How can
the global economy be the saviour of our future on the one hand
and the destroyer of our future on the other? The Prime Minister is
going to have to get his answer straight because there is a lack of
confidence in our economy when the Prime Minister makes
half-baked statements that he does not have a clue about. It
endangers the prospects of the country.
During the 1993 election the Prime Minister ridiculed Kim
Campbell because she said that high unemployment was systemic
and would stick around until the year 2000. In Calgary last week
the Prime Minister agreed with Kim Campbell's assessment.
Which Prime Minister should Canadians believe: the election
candidate for Prime Minister or today's Prime Minister who is
admitting that he does not know what to do either?
Hon. Douglas Young (Minister of Human Resources
Development, Lib.): Mr. Speaker, if the hon. member would just
think about what he said, the Prime Minister everyone should listen
to is the Prime Minister who ran for that office in 1993 and the
Prime Minister who is in office now. If the hon. member would
check he would know that when those statements were made the
unemployment rate was in double digits. In fact, since we came to
office in October 1993 there has been a substantial reduction in the
unemployment rate.
No one anywhere in the world is not going to have to face the
global challenges. The difficulty with facing those challenges is
that choices have to be made. We as a government have made those
choices. I am afraid the hon. member and his party do not even
recognize the challenges yet.
* * *
[
Translation]
Mr. Osvaldo Nunez (Bourassa, BQ): Mr. Speaker, my question
is for the Minister of Citizenship and Immigration.
In a document made public this morning, Quebec's minister of
immigration and cultural communities revealed that Montreal had
become the main port of entry in Canada for refugees. In the last 12
years, over 120,000 refugees have entered through Montreal. In the
last two years, the number of refugee claimants was even higher in
Montreal than in Toronto.
How does the minister explain that 56 per cent of claimants
arriving in Ontario obtain refugee status, while the proportion in
Quebec is 70 per cent?
Hon. Lucienne Robillard (Minister of Citizenship and
Immigration, and Acting Minister of Canadian Heritage, Lib.):
Mr. Speaker, you will forgive me if I am a little taken aback by the
question from the member for Bourassa. Am I to understand that he
is asking that more refugee status claimants be turned down in the
Montreal area? Is that what I am to understand? Am I to understand
that he is asking that the minister intervene with the quasi judicial
tribunal responsible for making these decisions? If so, I cannot
share his opinion.
Mr. Osvaldo Nunez (Bourassa, BQ): Mr. Speaker, at least the
minister should recognize that Quebec is much more generous than
the other provinces when it comes to refugees.
Can the minister tell us whether her government would give
favourable consideration to future proposals from the Government
of Quebec regarding a new cost sharing to help with the social
benefits provided to those seeking asylum, in light of the very
recent statement by the Quebec minister responsible for relations
with the public?
(1435)
Hon. Lucienne Robillard (Minister of Citizenship and
Immigration and Acting Minister of Canadian Heritage, Lib.):
Mr. Speaker, I must inform the members of this House that I have
never received written or verbal requests from Quebec's minister
of immigration.
* * *
[
English]
Mr. Jim Hart (Okanagan-Similkameen-Merritt, Ref.):
Mr. Speaker, when in opposition the Liberals railed against
Mulroney for lining the pockets of his buddies at taxpayers'
expense. Now Canadians learn that the defence minister has
handed out at
3006
least seven contracts of over $150,000. All the money has gone
into the pockets of his campaign pals.
Why did the Prime Minister think it was unacceptable for Brian
Mulroney to award his friends with lucrative contracts but he
thinks it is acceptable for the Minister of National Defence?
Hon. Marcel Massé (President of the Treasury Board and
Minister responsible for Infrastructure, Lib.): Mr. Speaker, the
Treasury Board has checked the various contracts that have been
mentioned. These contracts have been for work carried out to give
personal advice to the Minister of National Defence on a very
difficult and complex subject. All the rules of Treasury Board have
been respected in allocating these contracts.
Mr. Jim Hart (Okanagan-Similkameen-Merritt, Ref.):
Mr. Speaker, the facts speak for themselves. The Minister of
National Defence has abused his special ministerial discretionary
budget to reward campaign pals in his very own riding. This budget
is intended to benefit all Canadians, not political friends of the
minister.
Will the Prime Minister restore some integrity to his government
and order his Minister of National Defence to pay back the
$150,000 taxpayers' dollars of money that he has siphoned to the
pockets of his campaign pals?
Hon. Marcel Massé (President of the Treasury Board and
Minister responsible for Infrastructure, Lib.): Mr. Speaker,
once again we have looked at these various contracts to give advice
on a difficult subject. The work was performed by a trained
economist who could speak English and Greek and was aware of
the various problems that existed in the area of veterans and
veterans allowances. All the rules of Treasury Board have been
satisfied.
* * *
[
Translation]
Mr. Gilles Duceppe (Laurier-Sainte-Marie, BQ): Mr.
Speaker, to make the closing of the tokamak research centre in
Varennes easier for Quebecers to swallow, the Minister of Natural
Resources has tried to convince them that the government's new
priorities favour Quebec. In fact, the minister has disguised the
facts. First, the sale of Candu reactors benefits mostly Ontario and,
second, Atomic Energy of Canada is even thinking of closing its
operations in Quebec. Can the Minister of Finance, who has just
signed with Quebec a memorandum of understanding on the
economic development of Montreal, confirm the rumours that the
offices of Atomic Energy of Canada in Montreal would move to
Toronto, thus causing the loss of 130 direct jobs in Montreal?
[English]
Mrs. Marlene Cowling (Parliamentary Secretary to Minister
of Natural Resources, Lib.): Mr. Speaker, AECL has not
announced a decision with respect to the sites of those regional
offices.
[Translation]
Mr. Gilles Duceppe (Laurier-Sainte-Marie, BQ): Mr.
Speaker, could the Minister of Finance, who is talking about the
economic development of Montreal, promise as part of this
memorandum of agreement that Atomic Energy of Canada will
continue to operate in Quebec, as requested by the Ordre des
ingénieurs du Québec, the Chambre de commerce du Québec and
the Chambre de commerce de Montréal?
If he is so concerned about Montreal, I imagine he could give us
a short answer and elaborate a little more than he does about family
trusts.
[English]
Mrs. Marlene Cowling (Parliamentary Secretary to Minister
of Natural Resources, Lib.): Mr. Speaker, let me say again that a
decision has not been made.
* * *
Mr. Glen McKinnon (Brandon-Souris, Lib.): Mr. Speaker,
the Minister of National Defence recently announced that the
government is ready to move ahead on the vast majority of
recommendations from the special commission on the
restructuring of the reserves.
What assurance can the minister give this House that the
reserves community across Canada will be involved in this
restructuring process?
Mr. John Richardson (Parliamentary Secretary to Minister
of National Defence and Minister of Veterans Affairs, Lib.): Mr.
Speaker, it is a pleasure for me to announce that the government
has accepted most of the recommendations of the special
commission on the restructuring of the reserves and coincidentally
those of the House committee and the subcommittee of the Senate.
(1440 )
The paid ceiling of the primary reserve will be raised to a level
which will increase efficiencies, will allow an actual primary
reserve strength of around 30,000 and a supplementary ready
reserve will be re-invigorated to provide an estimated strength of
20,000. That will mean that Canada will have an effective reserve
of 50,000 persons.
The reserves community has been and will continue to be closely
involved in planning the implementation and restructuring of
reserves. These reserve units be given more authority for the
management-
3007
The Speaker: The hon. member for Kindersley-Lloydminster.
* * *
Mr. Elwin Hermanson (Kindersley-Lloydminster, Ref.):
Mr. Speaker, the Minister of Agriculture and Agri-Food has been
dragging his feet on making substantial changes to the way western
grain is marketed. Meanwhile, the recent threat to the status quo
Canadian Wheat Board monopoly powers resulted in immediate
and swift action by the minister within one hour.
The prairie economy is being cheated out of hundreds of
millions of dollars by the minister's failure to reform western grain
marketing.
Will the minister act immediately to require the Canadian Wheat
Board's buy back prices be based on the projected final Canadian
price rather than significantly higher U.S. prices, thereby allowing
producers with legal export permits to realize the benefit of better
prices when they find them?
Hon. Ralph E. Goodale (Minister of Agriculture and
Agri-Food, Lib.): Mr. Speaker, the hon. gentleman knows that the
purpose of the buy back policy as practised by the Canadian Wheat
Board is to ensure that all western Canadian grain farmers can
share in the value of the pooling process rather than that value
being reserved for the limited few.
With respect to the general operations of the Canadian Wheat
Board, that subject is being examined very closely by the Western
Grain Marketing Panel. The panel is looking at a variety of
methods by which the board's operations can be made more
flexible, more responsive and can be enhanced in the very best
interests of all western Canadian farmers.
It is fundamentally important for all of us in this House to
recognize that we must act in the interests of all of those whom we
seek to represent. That would refer to all western Canadian farmers
and not just a select few.
Mr. Elwin Hermanson (Kindersley-Lloydminster, Ref.):
Mr. Speaker, I do not think that the minister of agriculture
understands that all prairie farmers are getting less money than
they should right now. Prairie grain farmers are paid two to three
dollars less for their wheat than American farmers.
The minister might have avoided the problem if he had acted
promptly to correct it. He continues to tell farmers to wait for the
Western Grain Marketing Panel report. We have heard it hundreds
of times. We are missing opportunities for these premium prices.
Will the minister of agriculture give his word in this House that
he will act decisively to correct the problems in the marketing
system rather than make cosmetic changes or delay decisions that
will continue to hurt all prairie farmers, hurt the prairie economy
and kill jobs on the prairies?
Hon. Ralph E. Goodale (Minister of Agriculture and
Agri-Food, Lib.): Mr. Speaker, the question contains within it
some fundamental fallacies.
If, for example, there were a whole flood of individual sales
across the U.S. border aimed at certain specific spot prices that
might exist for the temporary time being at certain specific
delivery points, within a very few days those spot prices would
disappear, the price would be depressed overall and all western
Canadian farmers would suffer as a consequence.
I have indicated repeatedly that the Western Grain Marketing
Panel process is one that is fully credible and legitimate. I expect
the panel to produce a very valuable report. I expect that report to
be available toward the end of June and it is the government's
intention to respond to that report very quickly.
* * *
[
Translation]
Mr. Gilbert Fillion (Chicoutimi, BQ): Mr. Speaker, my
question is for the minister responsible for the Canada Mortgage
and Housing Corporation.
Three months ago, the minister responsible for the Canada
Mortgage and Housing Corporation told us she was about to
negotiate with the provinces the transfer of all federal social
housing programs.
Can the minister tell us what is the status of these negotiations
and whether the federal withdrawal will come with fair and
realistic financial compensation?
(1445)
Hon. Diane Marleau (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, talks are under way
with the provinces. We have already announced that the amounts
currently spent would be transferred to the various provinces. That
is what is on the table.
Mr. Gilbert Fillion (Chicoutimi, BQ): Mr. Speaker, during the
election campaign, the Minister of Finance promised housing
co-operatives that there would be secure, stable funding for social
housing.
Can the minister give us a guarantee that her government will
continue to honour its financial commitments to existing social
housing by transferring the amounts that were promised to the
provinces?
[English]
Hon. Diane Marleau (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, we have been very
clear that we are proposing to transfer the administration of social
housing to the provinces.
3008
At this point the federal government spends approximately $2
billion a year on social housing. Our proposal is to continue to
spend that amount. All contracts are binding whether they are with
the federal government now and transferred to the provinces as
they are today.
It is important to note that we hope the provinces will have
considerable savings and therefore will have dollars to devote to
social housing if there is only one administration. We think it is
very important to work together on this.
* * *
Mr. Jim Abbott (Kootenay East, Ref.): Mr. Speaker, let us put
an end to the myth about the Liberals protecting programs. In 1993
the Liberal Party vilified Reformers because we proposed a $365
million cut in CBC funding. However, once in power the Liberals
cut $377 million.
The Liberals say one thing and do another. They stand for
nothing, they believe in nothing. It is no wonder their CBC policy
amounts to nothing.
Who is to blame for the mess over at the CBC? Is it the Prime
Minister for another broken promise, or Sheila Copps for not
keeping her promises either?
[Translation]
Hon. Lucienne Robillard (Minister of Citizenship and
Immigration and Acting Minister of Canadian Heritage, Lib.):
Mr. Speaker, perhaps the hon. member did not hear the latest news
about an agreement having been reached at the CBC and
programming continuing undisturbed on our national network.
It is very clear that, like any other government agency, the CBC
has undergone budget cuts, but it is very capable of managing cuts
of this extent while continuing to offer quality programming to the
Canadian public.
[English]
Mr. Jim Abbott (Kootenay East, Ref.): Mr. Speaker, that was a
great answer, too bad it did not relate to the question.
The Liberals vilified the Reform Party for wanting to cut $365
million from CBC funding. We were honest with Canadians. Our
position was consistent. We said the CBC should be privatized.
Why does the minister go along with the fact that her predecessor
slagged the CBC by $377 million? Why will she not admit that the
government has no idea of what the program for the CBC is going
to be? She has no concept.
[Translation]
Hon. Lucienne Robillard (Minister of Citizenship and
Immigration and Acting Minister of Canadian Heritage, Lib.):
Mr. Speaker, clearly the Reform Party and the Liberal Party of
Canada fundamentally differ in their view of what Canada's public
television policy should be.
While the Reform Party may be intent on privatizing-its
electoral platform calls for privatizing Canadian
television-neither the Liberal Party of Canada nor the
Government of Canada have any such intentions. We will maintain
a public television network from coast to coast.
* * *
[
English]
Mr. John O'Reilly (Victoria-Haliburton, Lib.): Mr. Speaker,
Canadians in the agriculture and agri-food section are concerned
with jobs and the economy overall.
Can the Minister of Agriculture and Agri-Food give the House
any assurance that this vital section of our economy will meet the
target of $20 billion in exports by the year 2000?
(1450 )
Hon. Ralph E. Goodale (Minister of Agriculture and
Agri-Food, Lib.): Mr. Speaker, when the Canadian agri-food
sector established that target of $20 billion in agri-food sales by the
year 2000, the trade amounted to about $13.5 billion per year. That
was in 1992-93.
All of the trade figures are in for 1995 and they are $17.4 billion.
That is up 12.6 per cent from the previous year and nearly 30 per
cent over that period of 1992-93. The figures are up in the United
States, in Asia and in many markets around the world for Canadian
agri-food products.
The goods news is that every $1 billion increase in our agri-food
sales abroad translates into at least 7,500 jobs for Canadians.
* * *
[
Translation]
Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ): My
question is for the Minister for International Trade.
The 1984 Foreign Extraterritorial Measures Act enables the
federal government to force Canadian companies and American
subsidiaries operating in Canada to disregard any foreign
government measure adversely affecting our economic interests.
Could the minister tell us whether or not he intends to use this
legislation to counter the implementation of the Helms-Burton law
in the U.S.?
[English]
Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr.
Speaker, we have indicated in the House on several occasions that
when we see exactly what the United States does to implement the
Helms-Burton law, which is simply a law that has not been given
3009
regulations, we will then take a look at all the appropriate and
necessary measures to ensure that Canadian interests are fully and
adequately protected.
[Translation]
Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ): Mr.
Speaker, I will ask another question to try to get the specific
information we are looking for.
Does the minister intend to use the Foreign Extraterritorial
Measures Act in support of those Canadian companies doing
business in Cuba, which, like Redpath Sugars for instance, may
wish to maintain business relations with that country?
[English]
Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr.
Speaker, we would certainly apply any Canadian law to any
Canadian company that deals with extraterritorial measures.
I should point out to the hon. member that sugar was exempted
under the Helms-Burton law because of strong Canadian pressure
and lobbying. That part of the Helms-Burton law does not apply to
sugar at all and, therefore, it does not apply in this case.
* * *
Mr. Bob Mills (Red Deer, Ref.): Mr. Speaker, this weekend the
UN Secretary-General asked Canada to extend its peacekeeping
mission in Haiti to the end of the year. The Prime Minister's office
indicated that there would have to be significantly wider
international support for the mission and that the UN would have to
pick up the tab for this to be considered.
The minister and I both know from personal experience how
much it would cost to fulfil the mission to Haiti to really make a
difference. Will the Minister of Foreign Affairs state clearly to the
House that Canada will not consider renewing the Haiti mission
unless these two criteria are met?
Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr.
Speaker, to begin with I would like to thank the hon. member, along
with several other members of the House, who accompanied me to
Haiti last week on a fact finding mission to determine what the
future of the mission should be. I very much appreciate the
involvement of members of Parliament in that very important task.
In saying that, it is not possible to answer the question because at
this point we do not know specifically what will be recommended.
Options are being considered to substantially reduce the size of the
force. Before that happens the Haitian government has to make a
request to the United Nations security council. Until we know what
the request is and what the security council decides it is not our
position to say what our responsibility will be.
What I can say to the hon. member-and he knows this-was
that part of my mission to Haiti and other Latin American countries
was to ensure that they understood that Canada does not participate
in missions such as this by itself. We want the full participation of
other countries and the full mandate of international organizations.
Mr. Bob Mills (Red Deer, Ref.): Mr. Speaker, this is the exact
point. Our peacekeeping missions seem to be made up with
knee-jerk reactions at the last minute.
(1455 )
This option is up at the end of June. Boutros Boutros-Ghali
visited the Prime Minister on the weekend. He definitely said he
would like Canada to participate in extending this mission.
The Prime Minister then said that we need two things. Can the
minister not assure the House that at least we will have an answer
to those two questions: international involvement and the UN finds
a way to pay the bill.
Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr.
Speaker, it is hardly fair to say it is an ad hoc reaction when I spent
five days last week travelling to a number of countries in Latin
America to talk to them specifically about what would be required.
We asked a parliamentary delegation to come along with us. I
invited the UN special representative to come to Ottawa in early
June to brief Parliament on what might be required. We have
undertaken a wide variety of consultations with countries around
the world in order to determine what will be required.
Canada is taking a lead in helping to define what the UN will be
recommending. We are putting together a consensus of other
countries to make it happen. What we need to have before we can
make a formal response is a request. One cannot stay if one is not
asked. Until they ask, we cannot give the right answer.
* * *
Mr. Chris Axworthy (Saskatoon-Clark's Crossing, NDP):
Mr. Speaker, my question is for whomever is speaking for the
Prime Minister today.
The Liberal government was elected on the promise of creating
jobs, jobs, jobs and offering hope to unemployed Canadians. Last
week the Prime Minister said that Canadians will have to accept
and get used to high unemployment, another broken promise.
Today the Minister of Human Resources Development says he
does not really know why Canada's unemployment levels are so
high. Will the government please explain to all Canadians, espe-
3010
cially to those who are out of work, why this government has
broken yet another promise?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, a
couple of times today people have cited the Prime Minister. I
would like to read what the Prime Minister said in a speech within
the past week. ``The Canadian economy has managed to create
more than 600,000 jobs since the time we were elected''. This is
very significant.
The Minister of Human Resources Development talked about the
problems of the global economy and the problems that other
countries have creating jobs.
The Prime Minister went on to say: ``Believe it or not, Canada,
not the government, but mainly the private sector has created more
jobs in Canada than in Germany and France together''. That is an
indication of what this government has done. Those countries have
four times our population and we are creating far more jobs than
they are.
* * *
[
Translation]
Hon. Jean J. Charest (Sherbrooke, PC): Mr. Speaker, my
question is for the Minister of Intergovernmental Affairs and
concerns the first ministers' conference that will take place at the
end of June.
It is the fourth time I put a question in the House regarding the
agenda of the conference. The minister says that the throne speech
alludes to some elements, but the provinces were consulted and we
can only presume that this consultation process resulted in
decisions being made regarding the agenda.
I would like to know what are at least the starting points of this
discussion, this federal-provincial conference, if the official
agenda is still not available.
Hon. Stéphane Dion (President of the Queen's Privy Council
for Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, I thank the hon. member for his question. However, I
can only give him the answer I gave to the Leader of the
Opposition, namely that the agenda has still not been drawn up and
that the major points of the process to reform our federation are
outlined in the throne speech.
* * *
[
English]
Mr. Harbance Singh Dhaliwal (Vancouver South, Lib.): Mr.
Speaker, my question is for the Secretary of State for Asia-Pacific.
On September 6, 1995, Mr. Jaswant Khalra, a prominent human
rights activist, disappeared from his home in Amritsar, India.
When Mr. Khalra visited Parliament Hill last year, he expressed
fear for his life to many parliamentarians. Mr. Khalra's family
believe that he was forcibly taken by the police.
Could the secretary of state give the House an update on Mr.
Khalra's fate and what action the Canadian government is taking on
this issue?
Hon. Raymond Chan (Secretary of State (Asia-Pacific),
Lib.): Mr. Speaker, the government has made repeated
representations to the Government of India on the disappearance of
Mr. Khalra.
During the recent visit of the Team Canada mission to India,
both the Prime Minister and I discussed the case with our Indian
counterparts.
(1500 )
The high profile of the case has led to an order by the Supreme
Court of India to the powerful Central Bureau of Investigation to
begin its own investigation of the disappearance. Pending the
conclusion of the CBI's investigation, the National Commission of
Human Rights has suspended its own inquiry.
In the meantime, officials of NCHR are in regular contact with
the CBI. They are confident the latter is doing the right thing and
heading in the right direction.
Today, however, there is no news concerning the whereabouts of
Mr. Khalra. Rest assured Canada is putting a high priority on this
case and will continue to monitor the whereabouts of Mr. Khalra.
* * *
The Speaker: I draw to the attention of the House the presence
in the gallery of His Excellency Dariusz Rosati, Foreign Minister
of the Republic of Poland.
Some hon. members: Hear, hear.
* * *
[
Translation]
Mr. Gilles Duceppe (Laurier-Sainte-Marie, BQ): Mr.
Speaker, I would ask that the Minister of Human Resources
Development not leave the House. Can we ask the Minister of
Human Resources Development to remain here? I have a question
of privilege that concerns him. He has escaped again. How
characteristic.
Some hon. members: Oh, oh.
The Speaker: The member for Laurier-Sainte-Marie has the
floor.
Mr. Duceppe: Mr. Speaker, during the period-
3011
The Speaker: I would like to ask you whether this question of
privilege arises from something that took place during the period
for oral questions.
Mr. Duceppe: Yes, Mr. Speaker.
The Speaker: Very well. Please proceed.
Mr. Duceppe: Mr. Speaker, during the period for oral questions,
my colleague, the hon. member for Bourassa, asked a question of
the immigration minister. The Minister for Human Resources
Development made unacceptable, unparliamentary remarks to my
colleague, the hon. member for Bourassa.
The hon. member for Bourassa is of Latin American origin. He is
also a Canadian citizen. He is a sovereignist, and was elected as a
sovereignist. He is entitled to his opinions, whether or not they are
to the liking of the Minister of Human Resources Development.
However, the Minister of Human Resources Development, who has
a rather odd understanding of democracy, shouted at my colleague
from Bourassa: ``If you are not happy, get yourself another
country''.
That is unacceptable.
Some hon. members: Oh, oh.
The Speaker: My colleagues, the Chair did not hear what was
said. I am not certain that this is a question of privilege. But we
have the minister with us today and it was he who was referred to in
these allegations. If he wishes to clarify the situation, he may have
the floor.
Hon. Douglas Young (Minister of Human Resources
Development, Lib.): Mr. Speaker, I would like to clarify exactly
what I did say. The hon. member stood up in this House to ask
questions on immigration and refugees.
What I said in this House, and repeat now, was that he ought to
decide which country he respects. While it was Canada which gave
him citizenship, here he is now seated in this House preaching
separatism. Enough is enough, Mr. Speaker.
(1505 )
[English]
The Speaker: The hon. member for Laurier-Sainte-Marie rose
on a question of privilege. If words were exchanged between
members of Parliament I can see that these words might not be
acceptable to one side or the other.
However, because it was raised as a question of privilege, I judge
this not to be a question of privilege. It might have been a question
for clarification or of order, but my ruling is this is not a question of
privilege.
[Translation]
Mr. Duceppe: I rise on a point of order, Mr. Speaker.
The Speaker: Is this a question of privilege or a point of order?
Mr. Duceppe: A point of order.
The Speaker: Is this a new point of order?
Mr. Duceppe: After what the minister just said-
The Speaker: Dear colleagues, I have ruled on the question of
privilege, and it is my opinion that we are now moving on to the
debates. I do not believe it was a point of order. Sometimes things
are said in this House, on one side or the other, that are not
acceptable. In my opinion, this is debate. I would like to close the
incident here.
It is not, in my opinion, a question of privilege. If the comments
are on my ruling on the question of privilege, I do not wish to hear
any more about it at this time.
Mr. Duceppe: Mr. Speaker, I would a clarification.
The Speaker: Very well.
Mr. Duceppe: Mr. Speaker, I would like to understand properly.
I raised a question of privilege on something said during question
period, and you declare it is not a question of privilege. I would like
some clarification. I cannot therefore address the unacceptable
things said by the Minister of Human Resources Development
without-
The Speaker: Absolutely.
[English]
We can get into a debate with any member of the House at any
time. I have ruled this is not a question of privilege and at this point
it is not a point of order. There may be a debate on this issue.
[Translation]
Of course, all members have their opinions on what was said and
what is said; that is why we have debates here in this House.
Mr. Don Boudria (Glengarry-Prescott-Russell, Lib.): Mr.
Speaker, I do not want to get into a debate with the hon. member
who has just spoken or on the Speaker's ruling. It is clear that the
Chair has settled the matter.
(1510)
Once the Speaker has made a ruling, I think it is inconsistent
with our parliamentary traditions to question or otherwise
comment on the quality of this ruling. The Speaker presides over
this House and I think he does a good job.
From time to time, members on both sides of the House are not
always complimentary toward one another. A few moments ago, I
heard a member across the way accuse my colleague, the Minister
of Human Resources Development, an Acadian, of being
assimilated. I do not think he appreciated these comments either.
The hon. member has just left the room.
3012
A few days ago, similar charges were levelled against me.
Nonetheless, Mr. Speaker, whenever we as parliamentarians are
involved in a dispute, we should come to you for a ruling. You
did settle this matter and I think it is unacceptable for members
to question your judgment.
[English]
The Speaker: I understand that in the heat of debate on what
goes on in the House certain expressions and words are sometimes
used. As your Speaker, in debate I give you all the leeway possible.
However, when a decision is made by your Speaker it is made
with the House in mind. I hope hon. members would accept these
decisions in the spirit with which they are made in the hope that
true debate can occur.
I hope any remarks after I made my decision were not directed at
the Chair. In my view this would be unacceptable. I ask members
that after a decision has been made it be accepted as such and that
we move on.
We have debates in front of us today and I propose we move to
the debates at this time. If there is reason for me to come back to
the House after I review what has been said in Hansard and on
television, I will do so.
However, like members, I hold the office of the Speaker in the
highest regard. We must if we are to operate in the House.
At this point at least, until I have information to the contrary, I
believe we should get on with the work of the House which is
debate.
_____________________________________________
3012
ROUTINE PROCEEDINGS
[
English]
Mr. Paul Zed (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 which 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.
* * *
Mr. Paul Zed (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker,
pursuant to Standing Order 36(8), I have the honour to table in both
official languages the government's responses to 36 petitions.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, I am pleased to table in this House a petition signed by
2,000 residents of Saint-Pie-de-Bagot and Saint-Damase, or half
the households of these two municipalities.
(1515)
The people of Saint-Pie and Saint-Damase are asking Bell
Canada to modernize its network, which is totally obsolete in terms
of security and competitiveness. The petitioners are asking the
Canadian Parliament to intercede on their behalf with the CRTC to
urge Bell Canada to modernize the Saint-Pie and Saint-Damase
telephone networks so that citizens can enjoy adequate service.
I therefore table this petition and thank the mayors of the
municipalities and parishes concerned as well as the economic
development corporation for their support in this large scale
operation.
[English]
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Mr. Speaker,
these petitioners seek no change to the constitutionally acquired
rights of minorities in Newfoundland without the consent of those
minorities.
They point out that if an amendment is needed it should be one
that meets the hopes, aspirations and dreams of all of those
minorities. They ask that the changes to education be tried and if
subsequent to that an amendment is required, then one could be
brought forward. They fear the impact of this amendment on other
sectors of education and perhaps other rights such as minority
language rights.
Mrs. Beryl Gaffney (Nepean, Lib.): Mr. Speaker, I have two
sets of petitions with 211 signatures dealing with amendments to
the Canadian Human Rights Act.
The petitioners oppose any amendment to federal legislation that
would provide for the inclusion of the phrase sexual orientation. As
we know, that amendment passed last week.
Mrs. Beryl Gaffney (Nepean, Lib.): Mr. Speaker, I have a
petition with 50 signatures which deals with zero tolerance.
These petitioners call on Parliament to proceed immediately
with amendments to the Criminal Code that would ensure that the
sentence given to anyone convicted of causing death by driving
while impaired is a minimum of seven years and a maximum of
3013
fourteen years, as outlined in private member's Bill C-201,
sponsored by the member for Prince George-Bulkley Valley.
Mr. Randy White (Fraser Valley West, Ref.): Mr. Speaker, I
have three petitions, two of which are on the same issue.
The first two petitions ask that Parliament not amend the
Canadian Human Rights Act or the charter of rights and freedoms
in any way which would tend to indicate societal approval of same
sex relationships or of homosexuality, including amending the
Canadian Human Rights Act to include in the prohibited grounds
for discrimination the undefined phrase sexual orientation.
So much for that request.
Mr. Randy White (Fraser Valley West, Ref.): Mr. Speaker, the
third petition asks Parliament to support the development of a
victims bill of rights.
Mr. Garry Breitkreuz (Yorkton-Melville, Ref.): Mr.
Speaker, it is an honour and privilege for me to rise today to present
45 petitions signed by 1,233 concerned Canadians primarily from
the provinces of Saskatchewan and Ontario.
The petitioners draw to the attention of Parliament that over
100,000 therapeutic abortions are performed each year in Canada at
a cost of over $50 million per year. Since Canadians deserve a say
in how scarce health dollars are spent and which health care
procedures they consider essential, these petitioners call on
Parliament to support a binding national referendum to be held at
the time of the next general election to determine whether or not
Canadians are in favour of federal government funding for abortion
on demand.
Mr. Morris Bodnar (Saskatoon-Dundurn, Lib.): Mr.
Speaker, I have a petition asking that Parliament amend the
Criminal Code so that sentences given to individuals who drive
while impaired or who cause injury or death while impaired will be
reflected by the severity of the crime and that there be zero
tolerance in Canada toward this crime.
Mr. Ovid L. Jackson (Bruce-Grey, Lib.): Mr. Speaker, I have
the honour to table a petition on behalf of my constituents.
The petitioners pray and request that Parliament not amend the
human rights code and the Canadian Human Rights Act or the
charter of rights and freedoms in any way which would tend to
indicate societal approval of same sex relationships or of
homosexuality, including amending the human rights code to
include in the prohibited grounds of discrimination the undefined
phrase sexual orientation.
Mr. Alex Shepherd (Durham, Lib.): Mr. Speaker, I am pleased
to present two petitions today. The first deals with a concern of 48
of my constituents who wish Parliament to refrain from passing
into law any bill extending family status or spousal benefits to
same sex partners and specifically prohibiting amendments to the
Canadian Human Rights Act or the Canadian Charter of Rights and
Freedoms to include the undefined phrase sexual orientation.
(1520)
Mr. Alex Shepherd (Durham, Lib.): Mr. Speaker, the second
petition is from 52 of my constituents who are concerned that the
Government of Quebec, the Parti Quebecois, which has the
intention of separating the province of Quebec from Canada,
threatens the citizenship, livelihoods and properties of all
Canadians living in that province by denying their constitutional
and basic human rights and by promising to reject any move by
those Canadians to remain in Canada after a unilateral declaration
of independence by Quebec.
The petitioners request that Parliament take the necessary
measures to guarantee that their properties and territories will
remain within the Canadian confederation, and make its intention
to do so known to the PQ government prior to any unilateral
declaration of independence and/or the next referendum on
separation.
Mrs. Sharon Hayes (Port Moody-Coquitlam, Ref.): Mr.
Speaker, it is an honour to present two petitions from Canadians
opposing the recent amendments to the Canadian Human Rights
Act.
I believe it is an insult to these Canadians and to the concerns of
many others the way the government shut down debate in the
recent treatment of Bill C-33.
Mr. Mike Scott (Skeena, Ref.): Mr. Speaker, I am pleased and
honoured on behalf of constituents in Terrace, British Columbia to
present the following petition. Whereas the legislature of
Newfoundland passed a resolution calling for a constitutional
amendment to remove the rights of denominational classes of
persons to operate their own schools following a provincial
referendum, and whereas if the Parliament of Canada accedes to
the proposal to amend the Constitution at the request of one
provincial government, it would set a precedent for permitting any
provincial government to suppress the rights of a minority.
Therefore the petitioners pray and request that Parliament not
amend the Constitution as requested by the Government of
Newfoundland and refer the problem of education reform in that
province to the Government of Newfoundland for a resolution by
other non-constitutional procedures.
3014
Mr. John O'Reilly (Victoria-Haliburton, Lib.): Mr. Speaker,
I rise under Standing Order 36 to present a petition from people in
the Bobcaygeon Dunsford area of Ontario calling on Parliament to
embrace a zero tolerance to the sentencing of impaired drivers and
that sentencing must reflect the severity of the crime.
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker,
pursuant to Standing Order 36, I present two petitions which have
been circulating all across Canada.
The first petition has been signed by a number of Canadians
from Nepean, Ontario. The petitioners draw to the attention of the
House that managing the family home and caring for preschool
children is an honourable profession which has not been recognized
for its values to our society.
The petitioners therefore pray and call on Parliament to pursue
initiatives to eliminate tax discrimination against families that
decide to provide care in the home for preschool children, the
disabled, the chronically ill or the aged.
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, the
second petition comes from Canadians from Brampton, Ontario.
The petitioners bring to the attention of the House that
consumption of alcoholic beverages may cause health problems or
impair one's ability, and specifically that fetal alcohol syndrome
and other alcohol related birth defects are 100 per cent preventable
by avoiding alcohol consumption during pregnancy.
The petitioners therefore pray and call on Parliament to enact
legislation to require that health warning labels be placed on the
containers of all alcoholic beverages to caution expectant mothers
and others of the risks associated with alcohol consumption.
Mr. John Bryden (Hamilton-Wentworth, Lib.): Mr.
Speaker, I present a petition today which calling on Parliament to
support a binding national referendum at the time of the next
election on whether Canadians are in favour of the funding of
abortion on demand.
* * *
Mr. Paul Zed (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, the
following questions will be answered today: Nos. 5 and 18.
[Text]
Question No. 5-Mr. White (North Vancouver):
With respect to the unemployment insurance program, for the calendar years
of 1991, 1992, 1993, 1994 and 1995 (a) how many cases of fraud were reported
each year (b) how many convictions for fraud were secured each year (c) how
many frauds were there as a total of overall claims?
Mr. Robert D. Nault (Parliamentary Secretary to Minister of
Human Resources Development, Lib.): Mr. Speaker, in so far as
Human Resources Development Canada is concerned the reply is
as follows:
Question No. 18-Mr. Duncan:
Of the 633 Indian bands in Canada: (a) how many are covered by aboriginal
policing agreements, (b) what is the total cost for aboriginal policing
agreements for fiscal year 1993-94; fiscal year 1994-95; and the estimated final
cost for fiscal year 1995-96, and (c) of these agreements in question (b), what is
the federal government financial component of these aboriginal policing
agreements for fiscal year 1993-94; fiscal year 1994-95; and the estimated final
cost for fiscal year 1995-96?
Hon. Herb Gray (Leader of the Government in the House of
Commons and Solicitor General of Canada, Lib.): Mr. Speaker,
in so far as the Ministry of the Solicitor General of Canada is
concerned the answer is as follows:
3015
[English]
Mr. Paul Zed (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I ask
that the remaining questions be allowed to stand.
The Acting Speaker (Mr. Kilger): Is that agreed?
Some hon. members: Agreed.
[Translation]
Mr. Michel Bellehumeur (Berthier-Montcalm, BQ): Mr.
Speaker, there is a question standing in my name on the Order
Paper since March 6, 1996. I am referring to Question Q-19. A
little while ago, I asked the government whether an answer would
be forthcoming. Since then, my question has remained
unanswered. This is a very simple question. I would like to know
whether or not the government will be answering this very simple
question concerning the Privy Council. These things are easy to
assess and there should be no problem in giving an answer on this.
(1525)
Since March 6, no answer has been provided by the government
to this very simple question. Is it trying to hide something? Are
there things it does not want Quebec to know about? I do not know.
But I am persistent and I will rise in this House every week to ask
the government to answer my question.
[English]
Mr. Zed: Mr. Speaker, as my hon. colleague knows, we have
nothing to hide. The question is in process and we are preparing an
appropriate answer.
_____________________________________________
3015
GOVERNMENT ORDERS
[
Translation]
The House resumed consideration of the motion that Bill C-36,
an act to amend the Income Tax Act, the Excise Tax Act, the Office
of the Superintendent of Financial Institutions Act, the Old Age
Security Act and the Canada Shipping Act, be read the second time
and passed.
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr.
Speaker, I shall resume my demonstration where I left off when I
was interrupted by question period. I was trying to make taxpayers
in Quebec and Canada understand why we oppose Bill C-36 which
is implementing certain measures announced not in the finance
minister's latest budget but rather in the 1995 budget.
We were noting earlier that many of the measures contained in
this bill and in the 1995 budget were merely ad hoc measures
relating to some small and often insignificant aspects of corporate
taxation. Let me give you an example.
Last year, the Minister of Finance told us: ``I am pleased because
my 1995 budget will ensure that corporations, and large
corporations in particular, the big companies, pay more taxes. The
relative amounts paid by taxpayers versus businesses-small,
medium and big in particular-will be readjusted''.
One of the measures announced with great pomp to restore
equity and efficiency to the corporate taxation system was a special
tax whereby $160 million would be collected from Canadian
banks.
Before going any further, I would have two remarks to make on
this subject. First, this special tax of $160 million is ridiculous,
given that last year major Canadian banks made record profits of
close to $5 billion. Second, it is also ridiculous that, in Canada,
major banks, financial institutions and corporations, as well as very
rich families, can take advantage of the tax system's flaws,
flexibility and loopholes, as shown by two recent scandals.
There always has to be a scandal somewhere. In the first part of
my speech, I referred to two major scandals that were uncovered:
one by the Auditor General of Canada, the other by the prestigious
Toronto Star.
The auditor general was very clear. Through family trusts, a
system which the Bloc Quebecois, the official opposition, has been
condemning since it arrived in this House, two family trusts were
able to transfer $2 billion to the United States, without paying one
penny in taxes on capital gains, $2 billion.
The second scandal, which involves, indirectly if not directly,
major Canadian banks, was exposed on May 9 by the Toronto Star.
The newspaper got hold of a Revenue Canada study which had
been released shortly before to a select group and which stated that,
in 1991, tax evasion amounted to no less than $60 billion. In other
words, no less than $60 billion left Canada, possibly to be invested
in countries deemed to be tax havens.
(1530)
Since then, there has been no major change in the way capital
gains are taxed, even though we have been asking the Minister of
Finance for almost three years now to take action and to overhaul
the tax system. We are not talking peanuts here. When you think
that $60 billion in assets in 1991 alone were moved out of the
country tax free, as if by magic, and there was nothing that could be
done because of weaknesses in Canadian tax law, and also because
of weaknesses with respect to relations between Canada and the
so-called tax havens. You know what that means. That means that
taxes not collected on this wealth must be found somewhere else.
Since his first budget in 1994, and even more so since his 1995
and 1996 budgets, the finance minister has been trying to get this
money from the taxpayer, through various means, first, by cutting
transfers to the provinces for welfare, postsecondary education and
health. It is always the same taxpayer getting hit. But because the
minister has not taken a firm approach to tax reform, he must make
up the shortfall through other cuts.
While these wealthy Canadian families and big businesses are
taking advantage of tax loopholes, the Minister of Finance will be
3016
making up the shortfall by dipping into the unemployment
insurance fund, in complicity with the Minister of Human
Resources Development, who certainly showed us how little he
cared today. He will use the contributions of workers and
employers to make up for what others are not paying. That is
Canada's so-called fair tax system.
The Toronto Star focussed on certain interesting points
concerning this $60 billion tax evasion, one of which was that the
bulk of these transactions were linked to the major Canadian banks.
We in the official opposition are not surprised by this. We have
nothing against the big banks, but they must behave like good
corporate citizens as far as taxes are concerned. For the past two
and a half years or so now, we have been criticizing the fact that
Canadian banks have about 46 branches in the Caribbean alone,
this area being considered the ideal tax haven. Why do they have
these 43 or 46 Caribbean branches, twice as many as they have
anywhere else outside of Canada? This is not right.
And now we see why. With branches in these countries which are
considered tax havens, it is easy to take advantage of the weakness
of the tax agreements signed with those countries and to ensure that
profits are not taxed at the fair rate they ought to be.
As I recall, when the Minister of Finance tabled his budget in
1995, the one that has given rise to this Bill C-36, he said: ``We
have taken drastic measures against the major Canadian banks. We
will be imposing a special tax of $160 million on them''. Do not
make me laugh. The Minister of Finance should stop trying to be
funny.
This concerns us, because it took two scandals, one involving $2
billion and another involving $60 in tax evasions, flights of capital
abroad, for the Minister of Finance to decide finally to give the
finance committee openly, not behind closed doors, the task of
reviewing corporate taxation and particularly taxation of capital
gains.
We on the other hand will continue to monitor very closely the
Minister of Finance's accession to the demand we in the Bloc
Quebecois have been making since our arrival here. The experts
who will be working with the finance committee, with the elected
members on the committee, were appointed by the minister at the
time of the latest budget. Some of them at least may be clearly in a
conflict of interest.
Some of them work for firms advising major Canadian families,
Canada's wealthy families, along with large companies on ways to
take advantage of tax loopholes, on how to make transfers like the
one we saw involving family trusts, where $2 billion was moved to
the United States without being taxed, or the $60 billion in tax
evasions reported by the Toronto Star. My feeling is that the
official opposition, and all members of this Parliament, will have to
be extremely vigilant.
(1535)
As far as we are concerned, we are not prepared to take any
chances with the review process; it is far too important to us. The
well-being of taxpayers in Quebec and Canada is far too important
to us to allow the continued protection of tax loopholes that benefit
large corporations and wealthy Canadian families at the expense of
Canadian taxpayers.
What we intend to do is to scrutinize the taxation system in order
to be able to oppose arguments of our own-on behalf of the
official opposition and on behalf of the people of Quebec and
Canada-to the arguments put forward by these eight experts, a
number of whom are in conflict of interest.
However, there are two positive measures contained in this bill.
See how seriously we do our job in the opposition. The first one
deals with business numbers and allows Revenue Canada to
exchange business name and address information with other
federal government departments and the provinces. As part of the
effort to have corporations actually pay their fair share of taxes, I
think that this measure may prove positive.
The second measure deals with interest rates applicable to
unpaid taxes. It is a good idea to increase the rate of interest on
taxes payable to encourage speedier payment, but we were hoping
the government would take our advice. Ever since we were elected
to the House of Commons, in 1994, we in the official opposition
have been suggesting that resource levels should be increased at
Revenue Canada to really go after those whose taxes are unpaid.
Since 1994, we have been told over and over again by the
Minister of Finance that additional resources would be provided
because, year after year, approximately $6 billion in taxes payable
to the Canadian government remain unpaid. That is a lot of money.
For all the conviction shown by the Minister of Finance and the
many promises made by the various revenue ministers, out of $6.4
billion in unpaid taxes, $200 million has been recovered on average
every year for the past two years. That makes no sense.
Government must be streamlined. We in the official opposition
were the first to say that downsizing is required across government.
But the idea is not to blindly make cuts across the board,
downsizing to the same extent everywhere. Some departments,
including Revenue Canada, might benefit from additional
resources to recover more revenue, to recover more than $200
million out of $6.4 billion in unpaid taxes. This does not make any
sense. The money is not in dispute. Taxpayers-most of them rich
people, since the average amount of taxes owed has increased
considerably over the last eight years-do not dispute these
amounts. They know they owe the money to Revenue Canada, but
the federal government does not invest in the necessary resources
to go and recover it.
It might not be a bad idea to do like the Government of Quebec
did and to get the additional resources necessary to recover these
3017
unpaid taxes. These initiatives are about the only two positive
measures in the 1995 budget that I see in Bill C-36.
I can tell you, as we did in 1995 when the Minister of Finance
brought down his budget, that we will oppose Bill C-36. First, it
does not go far enough in terms of a true reform of corporate and
capital gain taxes. Instead, this government condones, through its
laxness, the loopholes, the tax evasion schemes, and the fact that
very rich taxpayers or corporations do not pay their fair share to
Revenue Canada.
We will also oppose the bill because, in spite of the two minor
initiatives to which I referred, most of the measures, particularly
those that concern family trusts, are just a joke.
(1540)
The government tells very rich Canadian taxpayers: ``You have
four years to invest your assets in other financial vehicles that will
allow you to save taxes''. This is a rather cavalier way of dealing
with the issue of family trusts, particularly since we learned, from
the auditor general, that at least two trusts transferred $2 billion to
the United States without paying any taxes.
It shows an obvious lack of determination on the government's
part to take action to make very rich Canadian families and major
corporations pay their due to Revenue Canada, as do small
businesses and individual taxpayers. This situation is totally
unacceptable. For all these reasons, and for those mentioned before
question period, I will ask members of the official opposition to
vote against Bill C-36.
[English]
Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, the title
of Bill C-36 is an act to amend the Income Tax Act, the Excise Act,
the Excise Tax Act, the Office of the Superintendent of Financial
Institutions Act, the Old Age Security Act and the Canada Shipping
Act. The title alone shows that this is just another typical case of
Liberal tinkering. The Liberals are trying to adjust half a dozen
different acts instead of addressing the real problems which are
inherent in the tax system itself because of its complexity.
This bill in implementing aspects of the budget is finding more
creative ways of taxing Canadians. The proof of that is in the size
of the additional tax moneys that will be collected which were
mentioned by the member from the government. All that additional
taxes do is increase unemployment.
There was a lot of discussion today during question period about
unemployment and the Prime Minister having said that we are
going to have to live with high levels of unemployment past the
turn of the century. The fact is that the Prime Minister and all of his
employed for life government colleagues have no idea how jobs
are actually created. If they did know they would be busy
creating them.
Certainly members have heard me use the example from time to
time of New Zealand, the country I originally came from. It had to
face up to the problems of government overspending and debt
which became unmanageable. The government in New Zealand
gave up on acts like Bill C-36 because it realized it could not
squeeze any more money out of the citizens of New Zealand. The
entire system was overhauled to simplify it, to bring it down to
much more of a flat style of taxation and to get control of
government spending to reduce spending and begin paying down
the debt.
As a result for example, just in the last week the New Zealand
government has introduced a $100 per month tax reduction for the
average citizen. There is $100 more per month in every New
Zealand worker's pocket. Imagine what ordinary Canadians could
do with $100 more in their pockets every month. That is
significant. That is not tinkering around the edges saying we will
give Canadians half a per cent here or take half a per cent from over
there. It is substantial tax reform which truly makes a difference to
people's lives.
New Zealand has not done everything perfectly. I am not saying
we should mimic everything that New Zealand does. Because I am
very familiar with it I am using it as an example of ways we could
learn methods which have worked to help create employment in
other countries.
New Zealand's unemployment rate is below 6 per cent and has
been for several years now, since about 1993. The economy is very
buoyant. I have relatives in New Zealand who own companies.
They have told me that the wage rates in New Zealand are rising
quite dramatically because the competition among employers to
get people to work for them is so high. There is so much
competition in the marketplace that the workers are now starting to
reap some benefits from it. A lot of the adjustments and other
things being done in this bill by the government would not be
necessary if it would only adopt a realistic approach to the idea of
job creation.
(1545)
In 1993, as part of the election campaign, the Reform Party had a
document called zero in three, which we used as a campaign
document. It was delivered all over the country. In it we detailed
exactly how we would balance the budget in three years and begin
showing surpluses. The step following that would be to begin
reducing taxes. That would put more money in the pockets of the
people. They would spend more, which creates consumption and
job creation. Those were the steps. We laid them out.
3018
Here we are three years further downstream. If the government
had adopted our zero in three program the day it came to office,
today we would be arguing about what to do with the surpluses
instead of arguing about which social program should be cut next.
It does not take very much common sense for Canadians to look
at what is happening on that side of the House: erosion of social
programs. We heard today how the CBC has actually had bigger
cuts made by the government than were listed in Reform's zero in
three program. Why would the government, which claimed that it
supported the CBC, make bigger cuts to the budget of the CBC than
were in Reform's supposedly slash and burn budget? The reason is
that it waited too long to address the problems of overspending.
Every day that this type of bill comes forward which tinkers
around with the system instead of truly addressing the problems
makes it harder and much more difficult to deal with those
problems. If the Liberals had only got to work the very day they
took office they would be running surpluses today and we would
not be discussing how to reduce contributions to RRSPs.
What a ridiculous thing to be doing. RRSPs are people's nest
egg. It is the tool people use to be able to retire so that they are not a
drain on taxpayers. It is all very well for the finance minister to
bring in rules that cut RRSP contributions because he will not be
around when other governments have to deal with the problems.
I watched a documentary on television last year where they were
interviewing finance ministers of the past from this place. Every
single one of them admitted they knew that all of these problems
would come to a head some time in the 1990s and they did nothing.
They knew it would be beyond their mandate. They would not have
to worry about it.
A whole series of decisions were made in this place that have
critically affected the future of our children and our grandchildren.
Those former finance ministers did not care about the millstone of
debt and deficits they were hanging around the necks of our
children and grandchildren. They went ahead because it suited
them to be dipping into the trough full of taxpayers' money when
they should have been truly addressing the problems.
I feel embarrassed when I have to go into a high school as I did
the other day in Bedford, Nova Scotia to talk about the debt. I wrote
the debt figure on the chalk board, $583 billion. In the one hour that
I was in the school it went up $2.5 million.
We were talking about the debt. I said to these students: ``How
long do you think it took to build this $583 billion debt?'' The
answer is that most of it accrued during their lifetimes. In all the
time that Canada has existed, most of that debt accrued in the last
20 years.
It was accrued by people who have worked in this place and did
not consider what they were doing to their children and
grandchildren. This bill, which tinkers with things like retirement
savings, reduces people's ability to plan for their futures. At the
same time, the government sends delegations around the country to
tell people the bad news about the CPP. Meanwhile the politicians
in this place protect their gold plated pension plan that would be
illegal in the private sector which they can collect after six years
and retire for good.
What about the average person out there who relies on CPP that
is now being eroded because the people who sat in this place in the
past did not bother to invest the income for the future. What should
be done as soon as possible, before it is too late and the whole plan
disintegrates, is to adopt a plan similar to the one that is used in
Chile. It gives people their own super RRSP style plan. It requires
compulsory contributions just like the CPP. The employers deduct
and remit to the individual plans but those plans belong to the
individual worker. The money does not go into government coffers
to be handed out to somebody else.
(1550)
In the meantime, the Government of Chile guarantees to those
people who are in their forties or fifties that there will be a top-up
from the taxpayer to ensure they will have a minimum pension
when they retire. For everybody else there are nest eggs building
which are completely separate from government control to protect
them when they retire.
That system has been in place in Chile for about 12 years. The
first people collecting pensions doubled what the government is
providing under the government scheme. It truly works. It takes
pension planning out of the government sphere.
This ridiculous Bill C-36 is eroding people's ability to save for
their futures. Chile is 10 years ahead of us in innovation and in
taking care of those problems.
Further down on the list the government plays around with
corporate tax rates. Has it not learned where jobs are created? The
Prime Minister stands up and says he has given up. He has admitted
failure in creating jobs. He is just like Kim Campbell because they
come from the same political school with the same old, tired out,
30-year-old theories that do not work. They just will not let them
go. They think the answer to all their problems is more taxes. They
think that by taxing the corporations they will fix the problem.
What about all the jobs that have left Canada because they drove
corporations out of Canada? What about the 20,000 people who
work across the border from Vancouver in Bellingham? Every day
they drive across the border to work at companies because their
bosses moved the companies out of the Vancouver area into the
United States to get away from high taxation.
This is not the policy of any party. I simply want to use it as an
example. Just imagine if we had a zero corporate tax rate in
Canada. Can you imagine the rush of companies from the United
States that would establish in Canada? They would come from all
3019
around the world by the thousands. We would have so many jobs,
jobs, jobs we would not know what to do with them.
Obviously somewhere between a zero corporate tax rate and the
punitive rates we have right now is a better rate that will
re-establish those good jobs for Canadians. Bills such as this
increase the irritation to business with higher taxes that reduce and
kill jobs.
I am from the small business sector in the Vancouver area. I
owned a company that had 10 employees. I sold that company
shortly before becoming an MP. Because I am from the small
business sector I have many friends in that sector. I cannot tell hon.
members how many of them have scaled down and moved back
into their homes to operate mom and pop type operations in order
to get away from taxation and all of the various levies and fees that
they had to pay when they had employees. When they had
employees they had to pay the Workers' Compensation Board, CPP
and UI premiums. They had to remit income taxes. They had to pay
all the benefits which are legislated. It gets to the point where 30
per cent or 40 per cent of all the cheques which a small business
person writes go to various levels of government.
Gas taxes affect business. There was a great foo-fa-raw a week
or two ago about the price of gasoline across the country. A simple
bit of analysis shows that about 55 per cent of the cost is taxation. If
governments were not dipping their hands into everyone's gas tank
the price of gasoline would be about 26 cents a litre. It is
government greed at every level that has created the problem. Bill
C-36 is just another case of that.
The Liberals claimed during the 1993 election that their $6
billion infrastructure project would kick start the economy and
create a job bonanza. The theory was that the people employed by
this wonderful $6 billion program, although it turned out to be a big
boondoggle, would spend the money in their communities, boost
consumption and then the good old days of full employment would
come back.
(1555)
However, anyone with business knowledge knew the plan could
not work from day one. Why could it not work? It would not work
because it did not create long term, meaningful jobs. It bought jobs
using taxpayer and borrowed money, money that was borrowed
against the future of our children and our grandchildren. It was
money that we did not have to spend.
For at least two decades these old line governments have been
throwing money into ineffective job creation plans, grants to
special interest groups, regional development funds and
government funded training programs without showing the
slightest concern for the debt legacy and the crippling tax load that
it has left for our children and grandchildren.
If governments could create jobs through deficit spending and
tax bills like Bill C-36, everyone would have three jobs each by
now. Twenty-five years of $30 billion deficits and a $583 billion
debt and what there is to show for it is chronic unemployment and
terrible fiscal problems. Social programs are being cut and the
government is scrambling to tax away every little last cent that it
can get from taxpayers' pockets.
I had a call from a constituent last week who runs a yacht
brokerage in my riding. He sells yachts. There has just been a
change to the GST rules. Now he has to charge GST when he sells a
second hand yacht. As he says, that is going to put his business out
of business overnight. Why would people pay an extra 7 per cent to
have a broker sell a yacht? It comes straight off the sales price for
the person who is selling a yacht. They are now going to try to sell
privately instead of putting it through a broker.
The government, in its enthusiasm to try to get that extra bit of
tax out of yacht brokers, is actually going to put them out of
business. This is so stupid. That same new tax rule is going to apply
to auctioneers. Can anyone believe this? We will go to an auction to
buy a used table and GST will be charged. It is just government
greed. It has nothing to do with good management of the economy.
It is typical of the type of thing this bill represents.
If the government truly wanted to make amends and get this
country back on track it would not be passing things like Bill C-36.
It would be creating meaningful, long term jobs if it could create a
climate for job creation.
Every time the unemployment rate goes down the government
likes to take credit for all the jobs that have been created. However,
when unemployment rises it does not want anything to do with it. It
says it is the global economy or somebody else made the wrong
decision. It never wants to take credit for rising unemployment.
The fact is that the government neither creates jobs nor loses
jobs but is responsible for the business environment that results in
job creation or job loss. Therefore, governments should really
concentrate on the business environment. Unfortunately reversing
the effects of two decades of government meddling in the economy
is not without its pain, as those who have ever watched the New
Zealand situation would know.
About three or four years ago, Eric Malling, on the TV program
``W5'' did a program on New Zealand showing the sort of fiscal
restraints that New Zealand was going through at the time as it
adjusted to becoming a free market economy. When I left New
Zealand in 1979 it was a socialist country. It was cradle to grave
socialism. The government paid for everything.
By 1984 New Zealand had pretty well gone bankrupt. By 1993
adjustments had been made and New Zealand was on its way back
to prosperity. Maybe members of this House saw the program on
television last week where Eric Malling on his program ``Maver-
3020
icks'' updated the New Zealand situation and showed how private
enterprise has created so many jobs and how buoyant the economy
is there.
I actually visited New Zealand at Easter. I can confirm what Eric
Malling showed on that program. The country is buoyant. One can
feel how successful the country has become, and it has not done it
with government subsidies, with extra taxes like this. It has not
done it by suppressing the right to invest in RRSPs. It did it by the
government getting out of the economy and letting business create
the jobs. It created jobs by getting rid of marketing boards so that
entrepreneurial farmers could sell new products.
(1600)
For example, I went into a supermarket and there on the shelves
were flavoured whipping creams. There was brandy flavoured
whipping cream, Kahlua flavoured whipping cream for special
occasions. There were specialty cheeses made by little cottage
industries which operated a tiny cheese making facility that
perhaps only made spreadable pepper cheese and sold it to a world
market.
In the supermarket there were eggs from farm operations which
specialized in low cholesterol eggs for which they charged
premium prices. They were almost three times the price of regular
eggs. There were eggs from guaranteed free range hens which were
allowed to wander the fields. They cost two and a half times the
price of eggs produced under the old marketing board battery hen
type operations.
These are examples of government getting out of the meddling
aspect of the economy and creating the environment for job
creation. It is not necessary to pass more bills to grab more taxes.
The net result in New Zealand was that so much income came
from all the prosperity, the government has been running surpluses
in the range of $3 billion to $6 billion a year, paying down the debt.
That was responsible for the latest announcement of $100 more in
the pocket of every working New Zealander's pocket every month,
the result of a reduction in income taxes.
Imagine if we were able to announce in the last budget in the
House that there was a $100 tax reduction for every Canadian
worker. We could have done it if we had adopted Reform's zero in
three program the day we came to the House. The answer to job
creation and getting around these tax problems is to adopt a
proactive program of creating the environment for job creation.
My colleague, the member for Capilano-Howe Sound,
introduced a private member's bill on March 4, the taxpayer
protection act. The bill would have required it to be compulsory for
the government to live within its income and not run deficits and
that there would be penalties for politicians if they overspent. They
would actually lose pay.
At least one province has already introduced such legislation.
The provinces are way ahead of us on this. They realize they cannot
keep grabbing taxes the way Bill C-36 does. Before question period
I was updating the House on the B.C. Liberal Party which is
presently involved in an election. The provincial wing of the
Liberal Party has promised a taxpayer protection act that would
guarantee a balanced budget in two years and, if it does not make it,
pay reductions for the politicians.
Look how out of touch the other side of the House is with the real
world, people saying they have had enough. They do not want to
pay any more taxes. They are sick of the government overspending.
It is about time government got on top of the problem and do what
the people want instead of following its own ideology constantly.
I hope that when there is an opportunity to debate a little more on
my colleague's taxpayer protection act members will seriously
consider supporting it and get us out of this cycle of tax and spend
that has been going on for so long.
In my opinion the bill we are spending time on today would not
have been necessary if it had not been for the irresponsibility not
only of current members on the other side of the House but also of
the parliamentarians who sat here for the last 25 years spending
$30 billion more a year than they took in. They just did not care.
They knew they would not be accountable for the end results. They
were answering the short term demands of special interest groups
at the expense of the next generation. It has been the most massive
intergenerational transfer of wealth in the history of this country. It
has to stop and the first step along that pathway is to defeat this bill.
(1605)
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Mr. Speaker, I
will be splitting my time with my colleague from Algoma.
My colleague from the Reform Party who made some negative
remarks about the government's $6 billion infrastructure program
forgets the almost 100,000 jobs that were created. He forgets the
large majority of municipal officials throughout Canada would
love to have that program continue. He forgets business people who
are aware of it would also like to have it continue.
I find it rather strange that all of these people want it and the
Reform Party does not. It says something about being out of touch.
If one wants to talk about being out of touch, I assure the House it is
not this government. Reform has not been popular. It was not
popular at election time and has been even less popular since then.
It has been dismembering itself member by member.
3021
I am pleased to have the opportunity to address the House on
Bill C-36, the income tax amendment act. I assure the House it
is not tinkering. As the House is aware, these amendments
implement certain measures announced in the budgets of February
27, 1995 and March 6, 1996 as well as Income Tax Act and Excise
Tax Act amendments released on August 9, 1995 concerning the
government's business under a number of programs.
The bill is very technical in nature and since there are those
better qualified to address the technical aspects I take this
opportunity to summarize points addressed by the bill. It talks
about retirement savings. It reduces the limits on contributions to
registered retirement savings plans, registered pension plans and
deferred profit sharing plans and it reduces the allowance for RRSP
over contributions.
[Translation]
On fiscal periods, it eliminates the opportunity to defer the
taxation of business income by selecting an off-calendar fiscal
period.
[English]
On family trusts, the bill eliminates the election to defer the
21-year deemed realization rule and the rules allowing the
allocation of income to preferred beneficiaries.
[Translation]
The film tax credit replaces the capital cost allowance tax shelter
incentive for certified Canadian productions with a new tax credit
for Canadian film production companies.
[English]
On charitable donations, the bill eliminates the 20 per cent of
income deduction limit for gifts of ecologically sensitive land.
[Translation]
On scientific research and experimental development, the bill
eliminates inflation of SR&ED tax credits through non-arm's
length contracts and introduces other measures improving the
administration of the SR&ED tax incentives.
[English]
On corporate tax rates, the bill increases the refundable tax on
investment income of Canadian controlled private corporations. It
increases the rate of part IV tax on dividends received by private
corporations and increases the capital taxes on large corporations
and financial institutions.
[Translation]
On joint and several liability, the bill provides joint and several
liability for unremitted source deductions and similar amounts
where a person has influential control and causes taxable payments
to be made without remittance.
[English]
On the old age security benefit, the bill modifies the structure of
the recovery of OAS benefits to provide for tax to be withheld from
benefits as they are paid.
[Translation]
On business numbers, the bill allows Revenue Canada to
exchange business name and address information with other
federal government departments and the provinces when they
adopt the business number. I note here that the Bloc Quebecois'
critic has commended the government for this initiative.
(1610)
[English]
Interest rates provide for different rates of interest on amounts
payable by the crown to taxpayers and amounts payable by
taxpayers to the crown. How could one call that tinkering? If one
had read that bill one would know it is not tinkering. It is dealing
with affairs of the state in a substantial, meaningful and profound
way.
More specifically, I would like to discuss the changes to taxation
of family trusts.
[Translation]
Family trusts allow assets to be held for beneficiaries. Trusts are
used for various purposes, particularly for business succession
planning and for meeting the needs of beneficiaries in special cases
such as old age and disabilities.
[English]
The 1995 budget proposed two changes to the taxation of family
trusts: one, the existing election to defer the application of the
21-year rule eliminated effective January 1, 1999; two, to restrict
income splitting, the preferred beneficiary election mechanism be
repealed for taxation years of trusts that commence after 1995,
except for elections with respect to persons with mental or physical
disabilities.
On the 21-year deemed disposition rule, the existing provision
relating to the taxation of trust generally require that assets are to
be treated for tax purposes as if they were disposed of every 21
years. The measure accompanied the introduction of capital gains
taxation in 1972 to prevent trusts from being used to void the
taxation of capital gains on death.
[Translation]
The previous government passed a provision allowing a special
election to defer the 21 year rule and the taxation of capital gains
on trust assets until the last ``exempt beneficiary'' dies. An
3022
``exempt beneficiary'' essentially means a relative who is removed
by no more than one generation from the person who established
the trust.
[English]
Effective January 1, 1999 the bill proposes to eliminate this
special election. Those trusts which have at any time before that
date elected to postpone capital gains taxation will be subject to a
deemed realization of trust assets at fair market value on that date.
This would not apply where all of the trust property has been
distributed to beneficiaries before that date. Where properties are
distributed from a trust to an exempt beneficiary, capital gains
would be realized when the exempt beneficiary disposes of the
property or when the exempt beneficiary dies.
[Translation]
On preferred beneficiary election, the bill provides that, before it
is distributed among the beneficiaries, the income from a trust fund
is calculated in the same way as for other taxpayers. The interest,
dividends and capital gains realizable are all included in the
calculation of the income from the trust. The taxable income of a
testamentary trust, and of some trusts created before 1972, is
subject to the same progressive tax rate structure as individual
income. The taxable income of other trusts is taxed at the
maximum rate applicable to individual income.
[English]
The preferred beneficiary election currently allows trust income
to be allocated to preferred beneficiaries defined to include the
spouse, children and grandchildren of the settlor of the trust and
taxed in their hands rather than at the trust level. This allows trust
income to accumulate without the need to pay the income to
beneficiaries. There is no requirement that the income allocated to
a beneficiary ultimately be paid to that beneficiary.
[Translation]
The selection made by a preferred beneficiary is an exception to
the general rule that the income from a trust is taxable as a trustee's
income, except where this income is payable to the beneficiaries
and thus taxable as their personal income.
[English]
The flexibility of the preferred beneficiary election and the
potential to split income among large numbers of preferred
beneficiaries make it a significant tax planning tool. The preferred
beneficiary election allows trust income to be split among family
members for income tax purposes without regard to the amount the
beneficiary would ultimately receive.
(1615 )
For example, where trust income in the form of dividends is
allocated to a beneficiary such as a young child with little or no
other income, substantial amounts can be accumulated on a tax free
basis because of the dividend tax credit. In addition, the entitlement
to the $500,000 lifetime capital gains exemption can be multiplied
because of the preferred beneficiary election.
This bill proposes to eliminate the preferred beneficiary election
except as it applies to those beneficiaries who are entitled to a tax
credit for mental or physical impairment, or who would be so
entitled if amounts paid for the remuneration of an attendant or for
care in a nursing home were ignored. The measure eliminates a tax
planning technique and seeks to ensure a level playing field
between property held in trust and property held directly. This
measure is to apply to taxation years of trusts that commence after
1995.
The recent auditor general's report cited examples of tax
avoidance and raised concerns about the administration of the
Income Tax Act involving the movement out of Canada of assets
held in family trusts. The department is undertaking certain
specific initiatives to combat and deter avoidance. The finance
committee is about to begin a study of the administration of the
Income Tax Act in this regard.
Changes such as those made in the 1995 budget discussed earlier
and including terminating the election to postpone capital gains
taxation under the 21-year rule will ensure that family trusts cannot
be used to defer capital gains taxation and ending the preferred
beneficiary election limits the opportunity for family trusts to be
used for income tax splitting purposes. The changes will help to
further close the loopholes.
Bill C-36 is an important part of this government's fiscal agenda.
As my hon. colleague noted earlier, it is the heart and soul of our
program. It is another step toward our goal of getting government
right.
Mr. Paul Steckle (Huron-Bruce, Lib.): Mr. Speaker, I have
listened with a great deal of interest to the comments of the hon.
member for St. Boniface.
He spoke at some length about family trusts. If there is a
misconception in this country in terms of what is really taking
place with family trusts it seems to be one of those things that
seems to abound at least at election time if not at other times.
Perhaps the hon. member could assure Canadians that progress
has been made, if indeed there has been progress made on this issue
in ensuring that the abuse of family trusts is no longer ongoing or at
least if it has been that things have been done to correct the
inefficiencies in the system.
Mr. Duhamel: Mr. Speaker, my colleague's question is an
appropriate and important one.
It was roughly a year ago that the Minister of Finance indicated
we needed to review this whole area and to close some of the
loopholes. Decisions have been made to do exactly that. As a result
of a recent event where large sums of money were taken out of the
country without, according to some individuals, appropriate levels
of taxation or no taxation, there will be continued work done in that
3023
area. Further loopholes will be closed. In fact this mandate has
been given to the finance committee of which I am a member.
I agree that the matter often comes up at election time. I
emphasize it is something that is not always well understood. I am
told by very highly respected people that they can have some
benefits but clearly they should not give advantages to people who
have large sums of money to escape a fair rate of taxation. They too
must contribute to the well-being of this nation.
Our objective at the end of this exercise is to make sure that all
people who earn income are taxed in a fair and equitable way and
that they make legitimate, reasonable, sensible and meaningful
contributions to the welfare of this nation and to its people.
Mr. Brent St. Denis (Algoma, Lib.): Mr. Speaker, I am pleased
to join my hon. colleagues, in particular the member for St.
Boniface, a colleague of mine on the finance committee, in
discussing and debating Bill C-36 which implements the 1995
budget measures.
The details of this legislation should not be overlooked but the
big picture is also very important. In that regard I draw to the
attention of the House an article in today's Globe and Mail. The
headline is: ``Bond buyers give Canada new respect''. Let me cite
the opening paragraphs:
Something remarkable has happened in the Canadian bond market in recent
weeks-and Canada's finance ministers can take most of the credit.
When interest rates on U.S. bonds charged upwards, Canadian rates followed,
but at a lesser clip. When U.S. rates levelled off two weeks ago, Canadian rates
fell sharply.
The result? The spread between Canadian and U.S. rates-a key measure of
how the world's investors feel about Canada-has plummeted, indicating that
bond buyers believe Canada is a lovely spot to put their money these days.
(1620)
There is another paragraph I wish to set on the record:
Bond buyers who shunned Canada as a high debt, high deficit, fiscally
irresponsible country for most of the 1990s have done an about-face. And it
takes only a quick look at what Canada's federal and provincial finance
ministers have done to understand why.
The article makes clear that fiscal restraint has become an
embedded aspect of the Canadian political landscape. It is this
government and this government's finance minister who have
played a key role in this transformation. The legislation before us
helps demonstrate a central aspect of that national sea change. It
does so in a most interesting way, not only by what is in the
legislation, but by what is not.
It will be noted that the 1995 budget did not include any
increases in personal income tax rates, nor did the 1994 budget
before it. That was again the case in the 1996 budget which
contained no tax increases of any kind.
The point here is that deficit reduction and debt control are made
in government problems and it is government that must be the
source of the solution. I am convinced that in the years to come
Canadians will look back at the 1995 budget, the source of Bill
C-36, as the turning point in our fiscal history.
The actions that budget introduced totalled $29 billion over three
years, more than in any budget since post-war demobilization. It
set a course so that by the end of the current fiscal year, program
spending will be $10.4 billion lower than when we started.
Just as important, this budget also changed the very structure of
how government operates. Through focusing on structural change,
not tax and revenue measures, this government made sure that
spending will be restrained beyond the two-year target period. The
deficit will continue to fall, reflecting our commitment to
eliminating it completely.
To achieve these results, the 1995 budget took fundamental
action across government programs and operations. It implemented
the results of program review, a comprehensive examination of
departmental spending. The budget also acted on a new vision of
the federal government's role in the economy, one that includes
substantial reductions in business subsidies. Subsidies will drop
from $3.8 billion to $1.5 billion per year by 1997-98. The 1995
budget reformed major transfers to the provinces, modernizing the
federal-provincial fiscal regime, making it more effective, flexible
and affordable.
Today's Globe and Mail article shows that the commitments we
have made and the fiscal actions we have taken are being
recognized in real bottom line terms. They have brought lower
interest rates and greater confidence in Canada. That is being
translated into growing employment.
The inflation rate remains at a very nice low level in Canada.
What has added resonance to our commitments, what has helped
win over the world markets is the way we have approached our
fiscal dilemma. Our action has been dramatically weighted toward
the spending side, not added to the high tax burden of Canadians.
That is why the 1995 budget did not increase personal income tax
rates. However, it did propose measures to improve tax system
fairness, many of which we see in Bill C-36 today.
The budget proposed eliminating the deferral of taxes on the
investment income earned by private holding companies. We are
also eliminating tax advantages for family trusts. We are
temporarily reducing the upper limit on RRSP contributions to
$13,500
3024
per year so that extra benefits do not go to people who earn more
than two and one-half times the average wage in Canada.
(1625 )
Even with these measures we would fall short of our deficit
targets. That is why the 1995 budget moved to increase the large
corporations tax and the corporate surtax. The budget also
introduced a temporary tax on the capital of large deposit taking
corporations, including banks.
Clearly, the 1995 budget was still a budget that placed an
absolute priority on expenditure reduction. It delivered nearly $7 in
spending cuts for each dollar of new tax revenue.
Again let me underscore our fiscal philosophy and the
philosophy that guides our tax measures, such as those found in
Bill C-36. We are tackling Canada's fiscal problem not as a narrow
goal in and of itself, but rather because it is a fundamental
component for national growth, new jobs, economic security and
sovereignty. As the Globe and Mail article highlights, our fiscal
progress and other actions are paying off. Canada's economic
fundamentals are strong.
With our first two budgets we established rock hard foundations.
With these measures our 1995-96 and 1996-97 deficit targets which
will bring the deficit down to 3 per cent of GDP are secure.
The steps in this year's budget consolidate and extend our first
two budgets and further contribute to our economic and financial
objectives. We have maintained our focus on reducing program
spending. Because the debt is a problem created by government,
the solution should focus on cutting in our own backyard. The
government has shown great leadership in handling public service
cuts. That is why of the cumulative fiscal actions we will have
taken from 1994-95 to 1998-99, a full 87 per cent have been
expenditure savings, not tax measures.
Together the three budgets will contribute $26.1 billion in
savings by 1997-98. This action, together with the reform of the
employment insurance program, will ensure that we hit our new
deficit target of 2 per cent of GDP by 1997-98. Our combined
budget plans will deliver a further $28.9 billion in savings in fiscal
year 1998-99. This means the deficit will continue to drop and the
debt to GDP ratio will continue to fall.
I have had numerous town hall meetings in my riding of Algoma
over the last number of weeks and I plan to hold several more. I
have already had meetings in towns like Espanola, Thessalon,
Hilton Beach, Little Current and Gore Bay. I plan to hold others in
Elliot Lake and Goulais River.
When people attend the meetings, while they have concerns
about one issue or another as is appropriate in this day when
governments are under close scrutiny, they also express confidence
in the way in which the country's fiscal affairs are being managed
by the government. There is evidence of it every day. The Canadian
dollar is remaining stable relative to the U.S. dollar. Interest rates
are remaining at a very credible level. Inflation is well in hand. The
economy is producing jobs.
We all agree that when unemployment reaches 9.5 per cent it is
too high. However, our economy is producing jobs. In the months
and years ahead we will see the unemployment rate decrease by
many more percentage points because the fundamentals are very
strong.
Bill C-36 expresses the philosophy of the government. It focuses
on the credibility this government has been able to achieve
compared to the past government. This legislation will help to
sustain the successes we have experienced. It will only add to our
credibility. It will add to the confidence investors have in our
country, both domestically and abroad. It will improve the equity
of our tax system and ensure that affluent Canadians and
corporations do not escape paying their fair share of the Canadian
tax burden.
(1630 )
For these reasons, I hope we have the co-operation of the
majority of members in the House in supporting Bill C-36. The
government is securing the financial future of the country. We are
trying to get government right and in so doing we are preserving
the social programs that are a hallmark of our society. These are
social programs that Canadians have come to count on, health care,
social services and pension plans. These are elements of our
society which make us very special and unique.
Those of my colleagues who have had a chance to do any
travelling outside this country will know we look quite wonderful
from outside. Sometimes we tend to take it for granted what we
have here. However, we are the envy of the world. As the Prime
Minister has often reminded us, the UN has for a number of years
in a row declared Canada to be the number one nation in the world
in which to live. We know that in our hearts but we forget it
sometimes.
I urge members to look carefully at how much we have and at
what the government is doing to make the country an even better
place not only for our children but for our grandchildren.
With that I call on the House, in a majority way, to place its trust
again in the government.
[Translation]
Mr. Paul Crête (Kamouraska-Rivière-du-Loup, BQ): Mr.
Speaker, I am very pleased today to speak to Bill C-36, a sort of
omnibus bill amending several aspects of the Income Tax Act, the
Excise Act and various similar pieces of legislation.
3025
What particularly attracts my attention, and what I would like
to address in my speech, is the whole question of measures related
to family trusts. I think it is very important that the public be very
well informed of where things stand on this issue. I would like
to give a brief run through of the background. In the 1993 election
campaign, the Bloc Quebecois raised many questions about the
amounts of money held in these family trusts. At the time, the
deficit was growing, as it continues to do, and we were also
wondering how we could ensure that we really received all the
tax revenues that we thought appropriate.
Thanks to information it had gleaned from one source and
another, the Bloc Quebecois knew that family trusts could contain
money that the government was missing. Following the election,
we kept telling the government: ``Before pronouncing on the
effectiveness of family trusts, let us at least find out the amounts of
money involved, what information we could obtain''.
As a young newly elected MP, I came here in all good faith,
thinking that, during our work in committee, we could actually
examine the figures, see what was possible and take appropriate
action accordingly.
But that was my first disappointment with the work of an MP,
because examining these matters in committee brought us up
against a wall of indifference, and even a wall of missing
information from senior public servants. Time after time, they told
us: ``The figures are not available. That would require giving
personal information. Most trusts involve families in which there is
a mentally or physically disabled person who cannot look after his
own needs. That is how it operates, so there is no reason to go
poking about in it''.
But our representations did get the government to decide to
make some modifications. For example, allowing families to free
up the assets they held in family trusts until 1999. We are, of
course, against that measure. It is like finding a burglar in your
house and telling him: ``You have an hour and half and then I am
going to start running after you''. He would have time to empty the
house before you would have been able to find out just what he had
taken.
There have been examples of this situation in recent weeks,
reference to trusts containing more than $2 billion which have been
able to send their assets, their investments, out of the country
without having to pay any tax on them.
(1635)
This is a really negative side of the government's action. The
fact of voluntarily acting slower than it should have a year or two
ago leads to situations like this. At a time when we need all the tax
revenues we can get, the message sent to workers in particular, low
or middle income earners, is that there are 500 rich families, from
what it says there, that may have family trusts.
There is talk of a tax shortfall of possibly $400 million. Four
hundred million dollars will not settle Canada's deficit problems,
but at least in terms of tax equity, Canadians and Quebecers will get
the message that the government is going after the rich as much as
it is going after the poor.
When unemployment insurance reforms like we have seen
recently occur in the same days and weeks as we learn that some $2
billion invested in family trusts has left Canada without being duly
taxed, people consider this situation clearly unacceptable.
Finally, we consider what is in Bill C-36 to be too little, too late.
It is too little, because the people who have invested in family
trusts will have had all the time they need to diversify their assets
and transfer them to other tax evasion possibilities. The Canadian
government thus does not collect as much tax as it could have. It is
too little and too late because of the time allowed for recovery.
I would like to remind the House of the recommendations made
by the Bloc Quebecois in December 1994, about one year after the
election, as part of a committee study. If these recommendations
had been carried out at the time, we would not have to deal with
trusts taking their assets out of the country and trying to find legal
ways to evade as much tax as possible; whether these tactics are
legitimate is a different matter, but they are still legal according to
the legislation put forward by the government.
The first recommendation made by the Bloc Quebecois is that
investigations be carried out to determine the exact value of assets
managed by family trusts, the value of capital gains from assets
under family trust management, the value of tax revenues whose
collection was postponed by deferring capital gains taxes until the
last trust beneficiary dies.
These studies could give us actual figures on the impact of the
legislative measures taken with respect to family trusts. We must
recall that family trusts were instituted in 1972 to help families
facing special and rather unusual circumstances, such as caring for
a child with a handicap, or even small business by allowing them to
tax-shelter certain assets. But like in many other such instances,
this measure is benefiting those who can afford the services of tax
specialists who found in this measure a tax loophole for avoiding to
pay taxes.
Since then, amendments made to the legislation have actually
made the family trust loophole wider. Now, efforts are made to try
to plug the hole, but the measures contained in Bill C-36 certainly
do not ensure tax equity for families in these circumstances.
I would also like to remind you of another recommendation
making it mandatory to pay taxes on capital gains on a trust paid
out in favour of the beneficiary. This issue has been close to our
hearts from day one, as it reflects the whole battle going on in
Quebec and Canada around the share of tax revenue that every
segment of society must pay to restore Canada's economy to
health. This issue has become a symbol; it is an issue where, as a
3026
result of yesterday's measures and carelessness, we find ourselves
today having to do without desperately needed resources.
On the one hand, they claim that the unemployment insurance
reform will save $2 billion through cuts to unemployment
insurance recipients and those who make contributions to the
unemployment insurance plan, employees and employers alike, but
on the other hand, they are leaving the door open for those who
should be paying up to $400 million in taxes.
(1640)
Imagine how much less pressure there would be on the
unemployment insurance system if the government's financial
statements showed additional revenues of $400 million from
family trusts. This would have taken pressure off of the
unemployment insurance reform. This is significant when we are
talking about fiscal balance. Sometimes, in debates like this one,
we hear that the opposition is there to criticize, to find flaws in the
legislation.
In this case, opposition parties are not the only ones making
recommendations. The Auditor General of Canada also raised the
issue of family trusts and asked the government to ensure that all
the information be available, so that future legislative measures
allow Revenue Canada to recover all the amounts that can be
recovered. The auditor general is only fulfilling his mandate, which
is to ensure that the amounts owed are collected and that the
moneys are spent in the best possible way to meet the objectives
set.
For a long time now family trusts have been used for purposes
other than to help small and medium size businesses. It is said that
someone with an annual income of $100,000 or $150,000 is
unlikely to have any use for a family trust. Who benefits from
family trusts? It is people whose income is very high. It is a fact
that these trusts benefit the very rich and that they deprive the
government of considerable revenues.
Family trusts are not the cure-all. Canada's fiscal problems
would not all be solved if trusts paid their fair share of taxes.
However, it would allow the government to tell taxpayers: ``We
made high income people pay their fair share. We asked them to
contribute and we made sure they all did. We did not provide them
with any means to avoid paying taxes. We kept a close watch on
them. Now, we are asking you to also do your share''.
That would make all the difference in the world in the situation
we are facing now, where those receiving unemployment
insurance, those with low incomes, are being asked to pay $100,
$150 or $200 in additional taxes on incomes of $20,000, $25,000 or
$30,000. In family trusts, we are talking about millions of dollars,
$400 million in unpaid taxes.
That would be seen as a gesture of fairness on the part of the
government, a gesture not found in Bill C-36. This bill does not
contain measures that would have made it possible to truly stem the
flow. The government tells us that it is washing its hands of
decisions concerning family trusts and capital shifted to the United
States when the Conservatives were in power, that it is not
responsible for what went on then.
But now, with the deadlines given, with the provisions in Bill
C-36, with the fact that people will have until 1999 to transfer their
money into other sectors, is the government not shirking its
responsibility? It cannot blame the Conservative government for
not doing its work. Now it is the Liberals who have decided to let
matters take their own course and to allow people to continue to
avoid paying taxes that they should be paying.
We must ask ourselves why they are doing this. Why, in these
times when we are so in need of money, are they closing their eyes,
not listening to reason and allowing wealthy families to continue
not paying their taxes?
I think that one thing that needs to be looked at very closely is
the question of party funding. Would there not be a link to be
made-indeed, almost a bank reconciliation-between the
contributions from these important families to parties which will
accept money from anyone, whether a physical entity or a
corporate entity?
In Quebec, for some years, nearly 20 in fact, only physical
entities can donate to political parties. This has led to a complete
change in political mores. The federal government has not yet
reached this stage. Significant sums, $50,000 or $100,000, can still
be received from companies, unions or other organizations.
(1645)
You can well imagine, afterward, when the government is being
lobbied, that the company or family which donated $50,000 or
$100,000 to the coffers of the party in power is certainly going to
be listened to because of that contribution.
All of the key points in this current situation are in place: a tax
system that has not been revised, a government that is very timid
about tax review. It talks about a technical committee. It is because
the opposition has repeated the same arguments and attacks almost
ad nauseam that it has managed to get some small changes of the
type found in Bill C-36, to at least close the loophole in the medium
term. But the government's measures are very timid, too timid, and
do not make the restrictions that ought to have been on the family
trusts.
In conclusion, I would say that the present government does not
appear to be aware of the urgency of acting in this area. First of all,
we have been aware for two years of the necessity of having all
3027
available information on family trusts. We have asked for it
repeatedly in committee, and senior officials have told us it was not
available, often in a rather condescending way. Today we find out
the reason for that reaction. It is because the transactions have
already been made and some are perhaps being made so that certain
taxpayers will avoid paying tax and, moreover, will take their
investments abroad.
I think this is unacceptable even to federalist Canadians. So the
government should have moved, legislated quickly on this. Today,
moreover, it must turn off the taps in a hurry, because it is clear that
there are many things that even Bill C-36 will not correct. There is
no way with this bill to ensure that each of the great families pays
the taxes it ought with respect to the funds it invests in family
trusts.
This is an important point. There is nothing in this bill to force
the legislator to act. This is why the Bloc Quebecois will vote
against the bill. So long as we obtain no assurance that family trusts
will no longer be a way to avoid paying taxes for people with the
means to do so, we will continue to press for satisfactory
amendments from the government. On this point, I hope the
Standing Committee on Finance will act quickly, now that we have
proof money is flowing out of Canada and being invested abroad
without taxes being paid on it.
I think that the government should follow the auditor general's
recommendations as quickly as possible and take appropriate
action so that, in the next federal budget, the revenue side of the
sheet will show the amounts that belong there, including taxes
payable by wealthy families and by those who invest in family
trusts, so that they pull their weight, and we do not see inadequate
cuts that crack down harder in the wrong places, for example,
through very stringent unemployment insurance legislation, on the
one hand, and a laissez faire approach on the other.
This sort of situation must be corrected. I hope that, after hearing
our arguments, the government will take corrective action and
bring in tougher legislation, so that people can no longer evade
taxes that they should be paying.
The Acting Speaker (Mr. Kilger): 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 Bourassa-Algerian nationals.
[English]
Is the House ready for the question?
Some hon. members: Question.
(1650 )
The Acting Speaker (Mr. Kilger): 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): Call in the members.
And the bells having rung:
The Acting Speaker (Mr. Kilger): The government whip has
made us aware that the vote will take place at 6.30 p.m.
* * *
Hon. Lloyd Axworthy (for Minister of Industry, Lib.) moved
that Bill C-4, an act to amend the Standards Council of Canada Act,
be read the second time and referred to a committee.
Mr. Morris Bodnar (Parliamentary Secretary to Minister of
Industry, Minister for the Atlantic Canada Opportunities
Agency and Minister of Western Economic Diversification,
Lib.): Mr. Speaker, when I was asked to participate in this debate
about Bill C-4, an act to amend the Standards Council of Canada
Act, I had to ask what stake my constituents would have in this
legislation and its implementation.
This got me thinking about the role of standards in society and
how they touch the day to day lives of Canadians. Clearly these
legislative changes are meaningful to Canadian businesses and
business because standards have an impact on business practices
and Canada's capacity to compete in the international marketplace.
Standards also matter to Canadians because they contribute to
consumer safety and health and to the utility of everyday products,
be they industrial, domestic or recreational. Therefore today I
direct my comments to the people side of the standards story.
In Canada standards setting is based largely on voluntary
consultation and consensus among a wide group of public and
private sector stakeholders. Individual citizens and volunteers from
industry and special interest groups routinely sit on panels and
committees that develop national standards. A variety of standards
development organizations accredited by the Standards Council of
3028
Canada, the SCC, bring these groupings of people together to set
standards affecting every sector in our society.
The SCC oversees the five key standards development
organizations active in Canada and estimates that a further 14,000
people are involved in some capacity with establishing and
maintaining standards in Canada. Together these experts and
concerned consumers establish standards for everything from
health care products to emergency planning.
Their deliberations and decisions set guidelines and standards
for environmental management practices, the manufacturing and
marketing of consumer products and electrical devices,
occupational health and safety, building codes and quality
assurance procedures. Standards which flow from a voluntary
consensus based system like the one we have nurtured in Canada
have the capacity to track the dramatic changes introduced by
technological innovation.
This consultative approach also takes place at the international
level, and often standards developed here in Canada lead the way
and become universally accepted.
The federal government embarked on an extensive consultative
exercise to examine standards and their growing importance for
Canadian consumers and business. That consultation revealed
significant interest in standards in Canada and support for an
enhanced role for the SCC. Most stakeholders favoured a broader
SCC mandate to include economic and environmental management
issues while maintaining the core mandate which already included
consumer protection. People told the SCC they were looking for
leadership, effective management, accessibility and constructive
Canadian action on the international stage. The bill we have before
us today reflects those public wishes.
(1655)
The bill also builds on our national record of achievement in
creating responsive, consumer driven standards. Without the work
of standards development organizations in Canada and their many
volunteers and technical committees we would not be so sure about
the safety of the light switches in our homes, that propane tank
under the barbeque and our child's bright yellow bicycle helmet.
The Canadian Standards Association, the CSA, one of the
agencies accredited by the SCC to develop Canadian standards, is
possibly the standard organization Canadians are most aware of,
although several other key standards development organizations
are also at work in Canada.
For over 75 years in Canada the CSA has ensured that a plethora
of electrical devices, chemical products and manufacturing
processes meet stringent national safety codes. Of the nearly 1,500
standards the CSA has on its books, about one third have been
incorporated into government regulation, and that trend continues.
On the high tech side Canada is playing a leadership role in
co-ordinating the vast network of computer systems that span the
world. As Canada builds its own information highway, committees
are at work to match our infrastructure with others in the world.
One initiative called open systems interconnection, OSI, involves
the creation and standardization of the unique electronic addresses
required by information highway users to send and receive
information. Here good standards equal good human dialogue, not
to mention technical innovation.
Let us talk about the air we breathe and the water we drink.
Canada provides the secretariat for an international technical
committee for environmental management which offers
management systems for corporations that have an impact on the
environment. As we speak, the committee is at work setting
standards for environmental waste management, environmental
audit practices, labelling and product design and safety. The aim is
to encourage compliance around the world, making it easier for
companies to plan for and monitor their environmental impacts.
On the horizon lie many more opportunities for Canadians to be
involved in domestic and international standards activities.
Growing emphasis is being placed on establishing standards for
management systems, including quality and the environment.
Canadians from all walks of life continue to participate on
standards writing committees or consumer advisory panels.
Though seemingly complex and bureaucratic, standards setting
mechanisms do affect our lives, and our powerful international
alliances have the potential to deliver significant and long lasting
benefits to the people of the world.
I also think these amendments, because they are based on so
much consultation, set the stage for a standard setting system that
engages and listens to Canadians. For that reason I think Canadians
will support the emphasis the government is placing on standards.
Mr. Philip Mayfield (Cariboo-Chilcotin, Ref.): Mr. Speaker,
it is a pleasure for me this afternoon to speak on Bill C-4, an act to
amend the Standards Council of Canada Act.
What are standards? Standards are measures of dimension, of
quality, of exactness, serving as examples or principles to which
others conform or should conform or by which the accuracy or
quality of others is judged.
Many Canadian and international organizations strive to attain
and maintain a certain level of standardization in fields relating to
construction, manufacture, production, quality performance, and
safety of buildings, structures, manufactured articles, products and
other goods not expressly provided by law.
3029
For example, electric plug manufacturers want their products
to work safely and efficiently. Therefore they build their electrical
plugs to fit into standardized wall sockets. These plugs must also
conduct a standardized level of electricity and allow household
appliances to work without sparking a fire.
(1700 )
As members can understand from this example, we need
standards in the smallest details of our lives. Standards are critical
in protecting the safety of Canadians and in ensuring their
economic prosperity and the well-being of their children both now
and in the future.
For instance, how do Canadians know that their children's
bicycle helmets will protect them when they fall or collide? How
do Canadians know that the windows in their houses will keep the
heat in while keeping out the cold of the winter? How do Canadians
know that their TV reception will not go fuzzy when they turn on
their home computers? The answer is standards.
Standards are crucial in protecting Canadian people and in
ensuring that goods and services will reach a level of quality on
which Canadians can depend.
In addition, increasing global trade forces Canadian companies
to agree on international standards. Canadian manufacturers know
that their products must meet the requirements of various countries
around the world or they will not be able to export and trade
abroad.
Canada's trade agreements, NAFTA, GATT and the internal
trade agreement, prohibit the use of standards as trade barriers.
However, international co-operation relating to standards is crucial
to Canada's economic growth.
The bill before us today deals with the Standards Council of
Canada. The mandate of this crown corporation is to promote
standardization with the hope ``of advancing the national economy,
benefiting the public, protecting consumers and facilitating trade
and furthering international co-operation''. These all relate to
standards.
What are the main elements of Bill C-4? First, it expands the
current mandate of the Standards Council to all areas where
standardization is not already provided for by law.
Second, Bill C-4 involves more Canadian volunteers in
standards activities and promotes communication between
governments and the private sector.
Third, Bill C-4 reduces the number of council members from 57
to 15 and adds qualifications for private sector representatives.
Fourth, Bill C-4 changes in the English version the titles of the
president and vice-president to chairperson and vice-chairperson
respectively.
Fifth, Bill C-4 specifies the duties of the chairperson.
Sixth, Bill C-4 establishes the provincial-territorial advisory
committee and the standards development organizations advisory
committee.
Finally, Bill C-4 specifies that meetings of the council and its
committees may be held through electronic means.
These are amendments to the Standards Council of Canada Act
that the Reform Party of Canada can support. I will only comment
on a few elements of this bill.
The Standards Council of Canada membership would be reduced
from 57 to 15. This is an important change. The council would be
able to meet more often with fewer people. Presently the council
only meets twice a year for a day each time. This is hardly enough
time to co-ordinate, develop and administer efficient and effective
standards, especially in today's electronic world with so many
rapid changes occurring.
Telecommunications and computers are advancing so rapidly
that it is difficult to develop standards quickly enough to keep up
with these changes. It is common sense that a smaller membership,
meeting more frequently, would be an improved means of dealing
with the complexities of standards implementation in this fast
changing world.
Using modern technology to hold electronic council meetings is
also a bold step for a crown corporation to take to operate more
effectively. These kinds of meetings can build efficiencies and save
tax dollars. We encourage the council to continue to experiment
with ideas of this kind.
The Standards Council of Canada membership would also
change under Bill C-4. The number of public servant members on
the council would decrease from six to one. This is a change that
would hopefully make the Standards Council of Canada more
representative of the Canadian people and the Canadian industry
that depend on these standards.
(1705)
Too often in the past government decisions have been made by
an elitist and insensitive group of public servants in Ottawa who
have no direct contact with the desires and needs of the Canadian
people who are trying to make the economy work. This requires
change, but it needs to change not only with the Standards Council
of Canada but with all of government.
Public policy needs to be designed and implemented by the
applicable level of government closest to the Canadians affected.
Canadians must have a direct say in what government plans and
what government brings into effect. When this happens, the
government can in the words of Pericles be called ``a democracy
because power is in the hands not of the few but of the many''.
3030
I am not suggesting a new idea. The private sector membership
of the council would also change under Bill C-4. To make the
council more open, accessible and accountable, members would
be representative of a broad spectrum of interests and would have
the experience necessary to assist the council in fulfilling its
mandate. This change would hopefully allow those most affected
by the council's resolutions to have a direct say in this decision
making.
I will comment on the Standards Council of Canada's financial
situation. Its operating expenses this year were estimated at
$9,847,000. Its revenues were estimated at $4,663,000, but its
budget for 1996-97 is estimated at $5,184,000. That is quite a
saving. I congratulate the council.
We commend the Standards Council of Canada for its efforts to
reach full cost recovery, but it has not gone far enough. It needs to
take further steps by being even more innovative in covering all of
its operating costs. In doing this the Standards Council of Canada
would be setting an example for all of government.
Therefore we challenge the government and we challenge all
crown corporations to follow the standards council's lead. We
challenge them to examine their operating budgets, to find areas
where they can offer programs more efficiently and to find where
costs can be fully recovered. More important, we challenge them to
find ways to become more accessible and more accountable to the
people they serve. They will be doing what is right for Canada and
what is fair and necessary for all Canadians.
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): Is the House
ready for the question?
Some hon. members: Question.
The Acting Speaker (Mrs. Ringuette-Maltais): Is it the
pleasure of the House to adopt the motion?
Some hon. members: Agreed.
The Acting Speaker (Mrs. Ringuette-Maltais): I declare the
motion carried. Consequently the bill is referred to the Standing
Committee on Industry.
(Motion agreed to, bill read the second time and referred to a
committee.)
* * *
[
English]
Hon. John Manley (Minister of Industry, Minister for the
Atlantic Canada Opportunities Agency, Minister of Western
Economic Diversification and Minister responsible for the
Federal Office of Regional Development-Quebec, Lib.) moved
that Bill C-5, an act to amend the Bankruptcy and Insolvency Act,
the Companies' Creditors Arrangement Act and the Income Tax
Act, be read the second time and referred to a committee.
(1710 )
Mr. Morris Bodnar (Parliamentary Secretary to Minister of
Industry, Minister for the Atlantic Canada Opportunities
Agency and Minister of Western Economic Diversification,
Lib.): Madam Speaker, I am pleased to begin second reading of
Bill C-5.
This legislation is a key part of the framework laws that provide
the foundation for our economy. Marketplace framework laws
provide the cornerstone of good government. They help
government play a less intrusive role in the economy by
establishing the rules that level the playing field for all concerned.
Modern, up to date framework laws protect consumers, small
businesses and others against the abuses of economic power. They
provide rights and impose obligations on marketplace participants,
thereby providing certainty and reducing transaction costs.
Framework laws are therefore essential for creating a climate for
business that fosters jobs, innovation and growth. They help create
the proper economic environment in which firms and consumers
make their decisions.
The particular framework laws in the legislation before us
involve bankruptcy and insolvency, an issue that few Canadians
want to contemplate. However, when Canadian businesses or
consumers find that they have need of insolvency protection, they
want to be assured that Canada's laws help them make the
necessary decisions to get their lives or their businesses back on
track again.
Canada needs bankruptcy laws that encourage rather than deter
risk taking and entrepreneurship. This is achieved by enacting
bankruptcy laws that provide certainty and fairness to both debtors
and creditors. The health of the Canadian marketplace depends on
this balance. Lenders and borrowers need the assurance that their
transactions are backed by framework laws that will treat all parties
fairly and that will allow innovative solutions.
At stake are jobs that rely on a company's ability to carry on
paying its debts. Good bankruptcy laws give firms and individuals
in financial trouble greater opportunity to get back on their feet by
reorganizing their affairs and allowing them to capitalize on
emerging opportunities. We must also be mindful of the health of
businesses that rely on the ability of its customers to pay. At stake
are the interest rates and conditions of borrowing at institutions.
They must always consider the risk of not getting their loans repaid
and set the price of their loans accordingly.
In sum, this proposed legislation is dealing with the whole moral
and ethical climate of the marketplace. Canadians want to be
assured that no one is slipping away from financial obligations by
3031
using bankruptcy as an easy way out. Canadians want assurances
that the piper will be paid.
Over the years bankruptcy laws have been very difficult to
reform and modernize. It proved to be difficult because so many
different and often diverging interests must be taken into account in
bankruptcy legislation. Consider for a moment the different points
of view.
Consumers abhor bankruptcy. They want bankruptcy laws that
offer a real and honourable alternative to bankruptcy and asset
liquidation. Canadian consumers want to be responsible and
honour their financial obligations but when there is no viable
alternative, consumers do not want to be harassed or stigmatized.
They want to turn the page quickly and be given another chance to
start afresh.
Then there is the business community. Business women and men
need insolvency laws that encourage rather than discourage them to
be bold, innovative and to take risks, knowing that there will be a
fair process to negotiate with creditors and reorganize their
finances if their financial situation deteriorates to a state of
insolvency. Corporate directors need incentives, not disincentives,
to make the bold decisions that will save a business in financial
difficulty.
What about lenders? No business, and for that matter very few
consumers, could go on and contribute to the health of the economy
without financing being available, and on reasonable terms.
Without bankruptcy laws that recognize the market realities of
security lending that treat different classes of creditors fairly and
equitably, Canadian businesses and consumers would be at a
competitive disadvantage compared to competitors in other
countries.
(1715)
Then there are the insolvency practitioners such as trustees and
receivers. They need adequate protection against personal liability
for claims that would otherwise lie against the debtor or estate.
Without adequate protection against personal liability, trustees and
receivers would either not deal with sensitive estates or would
systemically opt for liquidation when they would have opted for
trying to salvage the business and preserve the jobs that depend on
it.
Then there are federal and provincial treasuries that are
legitimate creditors. Where should they rank among other
creditors? What priority, if any, should the crown legislatively
grant itself?
There are many different and divergent interests. In the event of
an insolvency, when it comes time to divide the assets of a
company, like dividing a pie, each of these interests wants a piece
of that pie which unfortunately is not large enough to cover all
liabilities.
Where is the balance? What is fair and equitable? Is what is fair
for one class of creditor fair for another class of creditor, fair for
the business debtor and its employees, suppliers and shareholders?
These are the questions that insolvency laws grapple with.
At the same time, if the reorganization features of bankruptcy
laws are effective, the insolvent company can be given breathing
space to get its affairs back in order. It is as though the baker were
to say to his creditors ``back off for a bit, then you will all get your
piece of the pie and there will be more pies to come in the future''.
With so many conflicting interests is it any wonder that over the
past decades bankruptcy and insolvency reform has been among
the most difficult legislation to pass in the House?
The legislation includes more than 70 amendments which
respond to the needs of the many and varied constituents it exists to
serve, including the business community and consumer groups.
The amendments cover a wide range of bankruptcy issues from
consumer issues to commercial issues, to priorities and privileges
and to amendments to the Companies' Creditors Arrangement Act.
I feel we are on solid ground with Bill C-5. I am confident the
House will pass the legislation. I am confident for three reasons,
first because of the wide range of input and advice that we have
received from the whole spectrum of stakeholders.
In 1993, following passage of the Bankruptcy and Insolvency
Act, Industry Canada set up the Bankruptcy and Insolvency
Advisory Committee to review insolvency legislation, to identify
priority issues and to formulate possible solutions to them. More
than 100 private sector insolvency experts have participated in this
process. They represented consumers, business, lenders,
insolvency practitioners and governments. Their voluntary effort
speaks well of the importance of the legislation as well as the desire
of the private sector to participate in the process leading to
legislative reform.
I was very impressed by the calibre of the advice the committee
provided. The vast majority of the amendments before the House
directly respond to the specific recommendations made by the
committee.
I emphasize this legislation reflects the government's resolve to
respond to the needs of our clients, those who need and use the
legislation. Framework legislation must respond to the real needs
of the marketplace by taking into consideration real situations.
By themselves governments do not have the expertise to
anticipate the impact their regulations may have in the
marketplace. However, by working as a facilitator to bring together
the various interests and stakeholders, governments can play an
effective role in helping to build modern, workable framework
laws and policies. I am confident the House will recognize the
quality of the advice
3032
we have received and see it reflected in the wisdom of the
amendments before us.
The second reason I am very confident in the legislation before
us is the exceptional co-operation and support received from
cabinet colleagues. The amendments before us touch on a variety
of issues and interests. The ministers responsible for those interests
have provided their support and encouragement for this legislation.
(1720)
For example, the Minister of Human Resources Development
not only supports but has also been instrumental in crafting the
measures to make student loan debts non-dischargeable for a
period of 24 months after termination of studies.
Students who have received financial assistance from taxpayers
owe it to society and to future generations of students to reimburse
the loans they have received.
At the same time, however, governments and bankruptcy laws
have to recognize that some students may find themselves in a
hardship situation. This is reflected in the legislation by limiting
the period during which student loan debt would be
non-dischargeable.
The Minister of Justice and the Secretary of State for the Status
of Women are both quite enthusiastic about the measures to prevent
those who have been fined for sexual and other physical assault
from declaring bankruptcy as a means of avoiding their
obligations.
Under this legislation judgments for wilful damages will not be
released by a discharge. My colleagues have also supported the
measures in this legislation that would see spousal and child
support payments become provable priority claims.
The Minister of the Environment has offered me great advice
and collaboration in coming to grips with the important issue of
environmental liability for insolvency practitioners as well as the
no less important issue of the priority for environmental clean-up
claims.
I am proud to report the provisions proposed in this legislation
will not only assist business reorganizations but will for the first
time in Canadian history formally and legally recognize the
priority of a clean environment.
The third reason I am confident the legislation before us will
obtain the support of Parliament is that Bill C-5 is part of work in
progress. It is neither the beginning of the process of reforming
Canada's bankruptcy laws nor the end.
Some members will recall the spirit with which the changes to
the BIA were greeted three years ago. It was regarded as a
necessary first step in the reform of the framework laws. Some
members wanted to go further but one of the compromises made
back then was to commit the government to bringing bankruptcy
law forward for a parliamentary review three years after royal
assent.
The three-year review of the BIA was instrumental in obtaining
stakeholder and parliamentary approval of the 1992 amendments.
It provided some assurance to those whose concerns were not
addressed in 1992 that their issues would be dealt with in phase two
of the amendment process.
They were assured further modernization of the statute would be
considered by Parliament. The time for that review has arrived.
Members on both sides of the House will welcome the opportunity
to address many of the issues that were left unresolved on the
Bankruptcy and Insolvency Act was passed in 1992.
The legislation before us is very much intended to assist
Parliament in a statutory three-year review. This legislation fine
tunes and where warranted rectifies the reforms introduced in
1992.
It applies the spirit of the 1992 legislation and emphasizes giving
time for reorganization of business and rehabilitation of
consumers. From 1993 to 1995 over 48 per cent of the
reorganizations started under the Bankruptcy and Insolvency Act
are still alive. They are now under way with creditors and the
court's approval.
The reorganization provisions have created a framework to
facilitate discussion and negotiation between creditors and debtors.
The clear benefit is that the framework has created an environment
in which possibilities that would have been lost can be explored in
a transparent manner.
In other respects this legislation adds new items to the
bankruptcy reform agenda such as international insolvency and
reform of the Company's Creditors Arrangement Act.
In 1992 the passage of bankruptcy reform legislation represented
something of a breakthrough. Much had changed since the last
reform legislation had been passed some 40 years before. The
legislation before us represents very much a consolidation of some
of the reforms passed three years ago.
(1725)
The 1992 legislation addressed the heart of bankruptcy practices
by reforming the rules surrounding reorganizations. The legislation
before us takes these rules further by addressing many crucial
issues that arise in bankruptcy, issues such as environmental
liability and director liabilities, issues such as the treatment of off
farm income and consumer rehabilitation.
Some of my colleagues will address these areas in more detail.
In summary I emphasize the three strategic thrusts the legislation
before us provides.
3033
First, Canadian bankruptcy law will continue to provide a
framework in which it is preferable for consumers or businesses
to reorganize their affairs rather than declare bankruptcy.
Second, the legislation emphasizes the importance of measures
to promote consumer rehabilitation. We want to create an
environment in which consumers can act as responsible citizens.
Third, the legislation is aimed at promoting fairness to both
creditors and debtors.
The legislation helps minimize the social and economic costs
that result from insolvencies. It provides framework laws that will
help business debtors who want to become competitive once more
and consumers who want to act responsibly.
I hope all members will join me in voting in favour of the bill at
second reading.
Mr. Werner Schmidt (Okanagan Centre, Ref.): Madam
Speaker, I have read with considerable interest the provisions of
Bill C-5, an act to amend the Bankruptcy and Insolvency Act.
While there are a number of elements in the bill we can support,
there are a couple of things I want to address this afternoon which
we cannot support.
To review briefly, the bill does provide some rather interesting
remedies for some difficulties in the business of bankruptcy and
insolvency. For example, it comes to grips with procedures in
consumer bankruptcies and proposals. It deals with landlord
compensation where leases are disclaimed in reorganizations. The
liability of directors and stays of action against directors during
reorganizations are dealt with. There is protection for trustees and
receivers against personal liability for pre-appointment
environmental damage and other claims. Worker's Compensation
Board claims are dealt with, dischargeability of student loans and
so on.
A number of these are rather significant. I will address a couple
of these which are particularly worthwhile noting. First is the
matter dealing with student loans. Students are responsible for their
loans two years after they declare bankruptcy. That is significant
because at the present time there is apparently an opportunity for
students to escape paying their loan simply by declaring personal
bankruptcy. This provision alone should save the federal
government approximately $60 million.
Another has to do with divorced spouses. The provision in the
original draft of this bill was not acceptable, but the minister has
agreed to accept one of our amendments. Therefore this area will
be covered very well. It deals with divorced and separate spouses
who will receive priority ranking among creditors for settlement of
claims. Spouses are not now considered creditors under the
bankruptcy laws. I think that new provision is a particularly good
one and ought to be endorsed.
The business of company director liability is also addressed and
directors are permitted to defend themselves against negligence if
they can prove they acted with due diligence. They would also get a
stay of proceedings against them during reorganization
proceedings. This provides a certain element of protection missing
in the previous legislation.
In the matter of environmental clean-ups, the act becomes clear
as well. It says environmental clean-ups will get top priority over
the claims of creditors. Bankruptcy trustees and receivers will have
to report environmental hazards they notice after a company
becomes bankrupt.
Finally, in securities firms a process is laid out for bankrupt
securities firms, particularly with regard to securities and debts
held in the name of their clients. This is particularly significant
because there have been clients who have been left high and dry by
a security firm that went bankrupt and the money which was held
by the company in trust was lost.
(1730 )
I would now like to look at another area which has to do with
bankruptcies more generally. While this bill begins to come to
grips with the ways in which bankruptcies are dealt with, it does
not come to grips with the causes of bankruptcy. This gives me the
opportunity this afternoon to suggest that there is a far too high an
incidence of bankruptcies in Canada.
Consumer bankruptcies have soared in the last 10 years from
approximately 20,000 in 1986 to over 60,000 in 1995. This is a
threefold increase. Consumer bankruptcies are a sign of the lack of
jobs that exist and the failure of the government to adequately
address the problem. As a result, this bill cannot address the issue
that is really at the heart of what is causing bankruptcies in Canada.
The federal debt now stands at between $580 billion and $585
billion. It is becoming very close to the $600 billion figure. It is all
very nice for the Minister of Finance to talk about the wonderful
way in which the deficit is being reduced each year, that the deficit
this year will be a little less than last year and that it looks like
eventually the government will get to the point where the deficit is
reduced. However, he has not promised that he will eliminate the
deficit.
Every Canadian knows that with each deficit the debt gets
bigger. It does not help to say that the deficit is going down if the
debt keeps on growing and the interest that has to be paid on the
debt becomes greater. That is not the only one of the causes for
bankruptcies. The taxes that are paid by taxpayers to pay the
interest is constantly increasing and it is therefore more difficult
for businesses to operate successfully.
When will the government recognize that as the debt increases,
the predatory action of the interest on social programs and on
businesses also increases. This bill, while it is a beautiful bill, does
not go far enough. The reason we have the bill is because there are
3034
too many bankruptcies. The time has come for us to realize that
Canada must get its financial house in order so that it does not go
bankrupt and become subject to something like the bankruptcy act
in terms of the international monetary situation. I hope it never
comes to that. Certainly it does not have to. I would encourage all
of us to take the steps necessary to ensure that does not happen.
I draw the attention of the House to three areas where the bill is
lacking. These are omissions. The first area deals with the lack of
certain requirements of the Superintendent of Bankruptcies to
report to the minister. The second area is the omission to provide
for unpaid supplier accounts. The final area is the omission of
payment of wages to workers whose employment is terminated
because a firm went bankrupt.
I want to draw attention to the omission of certain requirements
with regard to the superintendent to report to the minister. The role
of the superintendent is described in section 5 of the act. It is very
interesting what this bill does. I want to put this in the context of a
certain management theory which is rather significant. I want to
focus it from four perspectives: responsibility, accountability,
delegation and power.
Responsibility is the clarity of tasks and lines of authority and
communication so that everybody knows which responsibility and
which outcome they are responsible for.
Accountability is who checks the work done, where does the
final word come from and where does the buck stop. These areas
have to be clearly identified.
Delegation is the assignment of tasks to others because no one
person can do everything. We must ensure that the delegation is
such that the whole operation works.
(1735)
Finally, there is the matter of power; to effect the discipline
necessary to enforce by placing sanctions or the issuance of a
reward to those who should be rewarded for the work that they have
done.
The principle that I wish to enunciate is that the elected persons
are responsible to those who elected them. It is the absolute number
one requirement. What has this got to do with the bill? I suggest
that in order to accomplish the governing of a nation, a province, a
municipality or the administration of a complex organization
engaged in business or commercial activities, there are certain
management principles which must be observed in order to assure
that the goals, purposes and the mission of the organization can be
accomplished.
The principles are the division of tasks to be formed into
manageable components and to make sure that these tasks are
carried out to the satisfaction of those in charge. How does this
come into focus for Bill C-5?
Generally speaking, the bill does a reasonable job in meeting the
requirements that would normally be associated with the
implementation of these principles. However, it falls short in
several areas. Two of them are accountability and responsibility.
As in several other pieces of legislation which have been
presented to the 35th Parliament, this bill contains the provision of
giving to the bureaucracy powers and the assignment of authority
and responsibility without recognizing the role and the
responsibility of Parliament and the elected representatives whose
primary responsibility is to the people who have elected them to
manage the affairs of this country in their best interest and to the
advantage of all Canadians.
In Bill C-46, for example, which amended the Corporations Act,
the minister was given in the initial presentation of the bill powers
to determine the winners and losers by determining programs and
special assistance in whatever industries, particular industries or
commercial establishments, organizations or persons who are
members of a particular category of persons defined by cabinet
order. The minister changed that later and that is to his credit.
Bill C-99, which amended the Small Business Loans Act,
contained provisions that the amount of liability of the government
would be decided by cabinet, not Parliament. Again, it was an
abrogation of the responsibility of Parliament and the members'
responsibility to look after the best interests of the people who
elected them.
Bill C-5 does not rectify that situation. Powers have been
delegated to a bureaucrat, in this case the Superintendent of
Bankruptcy. They should be in my opinion those of the minister.
What are some of these responsibilities? I will read from clause
5 of the bill we are considering:
5.(1) The Governor in Council shall appoint a Superintendent of Bankruptcy
to hold office during pleasure who shall be paid such salary-
(2) The Superintendent shall supervise the administration of all the estates to
which this Act applies
(3) The Superintendent shall, without limiting the authority conferred by
subsection (2),
(a) receive applications for licences and renewals thereof to act as trustees
under this Act, and, as authorized by the Minister, issue licences and renewals
thereof to those persons whose applications have been approved;
(b) keep a record of all licences granted and of the renewals thereof as they are
issued;
(c) where not otherwise provided for, require the deposit of one or more
continuing guaranty bonds as security for the due accounting of all property
3035
received by trustees and for the due and faithful performance by them of their duties
in the administration of a estates to which they are appointed, in such amount as the
Superintendent may determine, which amount may be increased or decreased as he
may deem expedient, and the security shall be in a form satisfactory to the
Superintendent and may be enforced by the Superintendent for the benefit of the
creditors;
(d) keep such records as he may deem advisable of proceedings under this
Act;
(e) from time to time make or cause to be made such inspection or
investigation of estates as he may deem expedient and for the purpose of the
inspection or investigation the Superintendent or any person appointed by
him for the purpose shall have access to and the right to examine all books,
records, documents and papers pertaining or relating to any estate;
(f) receive and keep a record of all complaints from any creditor or other
person interested in any estate and make such specific investigations with
regard to such complaints as the Superintendent may determine; and
(g) examine trustees' accounts of receipts and disbursements and final
statements.
(4) The Superintendent may intervene in any matter or proceeding in court as
he may deem expedient as though he were a party thereto.
(1740)
It is a good set of duties but members will notice the number of
times it says the superintendent ``may''. He may do this, he may do
that and he may do something else.
Let me quote from another clause:
6.(1) The Superintendent may engage such accountants or other persons as he
may deem advisable to conduct any inspection or investigation or to take any
other necessary action outside the Office of the Superintendent, and the costs
and expenses thereof shall, when certified by the Superintendent, be payable
out of the appropriation for the Office of the Superintendent.
It continues down through the rest of that clause. Now comes the
big, heavy duty clause, clause 7 of the bill which reads as follows:
7. When any investigation has been made by the Superintendent or any one
on his behalf; and it appears that a licensee-
That is a person or group of persons or a company that is
authorized to manage an estate.
-under this act has not performed his duties properly or has been guilty of any
improper conduct or has not fully complied with the law with regard to the
proper administration of any estate, the Superintendent may make a report to
the Minister together with such recommendations to the Minister as the
Superintendent may deem advisable.
Notice that there could be an unlawful conduct, or an omission,
or not having done something, an omission of some kind. The
superintendent is not obligated to report. He may report to the
minister. He may make a report to the minister together with such
recommendations as the superintendent may deem advisable.
Huge estates could be at stake here. Big companies could be
forced to reorganize their financial structures. Huge corporations
could be forced to reorganize their international operations or
indeed their national operations, affecting literally thousands of
people's jobs. Perhaps the welfare of many other businesses depend
on this larger organization to function.
If the trustee acts in a manner that is unlawful it is not a
requirement of the Superintendent of Bankruptcy to cause that
licensee to have his or her licence withdrawn or even a report to be
made to the minister. Yet it is the minister who is responsible to
look after the welfare of the people of Canada and was elected by
those people to represent their interests.
The bill does not address this issue at all. It is silent on this
matter. The difficulty is not in the range of responsibilities listed
here, nor is it that the superintendent should not have substantial
powers to enforce the fair and just administration of the estate of a
person or corporation that is insolvent or bankrupt.
The difficulty is that the superintendent is not held to account to
any elected official in the event of a licensee who ``has not
performed his duties properly or has been guilty of an improper
conduct or has not fully complied with the law with regard to the
proper administration of any estate''. That is a serious and a very
significant provision in current legislation and this bill does not
address it at all.
The difficulty is that the application of the powers to assure
fairness and veracity of trustee's reports is not subject to review by
law. And it should be. Nor does it appear to be a requirement of the
superintendent to make available trustee reports in the event that a
civil litigation be launched and in that litigation perhaps charges of
unfairness, perhaps bias or maybe even in some cases collusion by
creditors against a particular bankruptcy. It is not a requirement of
law that if such should be the case, the superintendent is required to
present that kind of a report to the courts, and I think it ought to be.
The reason why this is so important is that information contained
in bankruptcy reports can be crucial in the examination of the
reasons for the bankruptcy or the reorganization requirement of a
particular enterprise. Therefore it would appear imperative that
amendments be introduced that would replace ``may'' with
``shall''. This would effect a shift in power from that of the
superintendent to the minister.
(1745)
The minister should have the final responsibility on matters such
as the receiving of reports about the neglect of performance of
3036
duties of licensees who are administering bankrupt estates instead
of giving the superintendent absolute discretion in such matters.
The problem is exacerbated because it is the minister who issues
and revokes licences. The minister does that but he does it on the
advice of the superintendent. With those kinds of powers and with
that kind of advice it is obvious what the minister will do. Such
broad power is enough to determine the financial and economic
success, or at least the viability, of a bankruptcy trustee.
In other words, a bankruptcy trustee may make a livelihood of
administering bankrupt estates. If there are 60,000 of them in one
year there is a lot of work to do. If the licence should be revoked the
very welfare of that trustee could be at stake. If the superintendent
of bankruptcies is the one who has that power, we can see how easy
it would be for all kinds of things to go kind of funny in the
background.
It also makes it possible for certain trustees to have a virtual
monopoly on a set of estates or in doing work for a department.
Determining the success or failure of a litigation, contesting the
administration of the bankrupt estate, the causes which result in a
bankruptcy, the fairness of assessing the claims properly and the
priority of creditors are all related to the work of the trustee who is
in charge of a particular bankruptcy.
Power to abuse is what we have here. There is power to abuse the
system and that power needs to have checks and balances. I suggest
those checks and balances rest with the minister and with cabinet,
not with bureaucrats. Hence I suggest the minister consider the
addition of the appropriate amendments to the Bankruptcy and
Insolvency Act to remedy these shortcomings.
In matters of this kind there is always the possibility of being
tempted to exercise power in a biased or discriminatory manner
because of the money involved, thousands of dollars, hundreds of
thousands or millions of dollars in some cases.
While there are strong provisions in the bankruptcy act to
discourage this biased practice, such provisions are difficult to
enforce if other provisions of the act permit certain matters to go
unreported to those in positions to do something about them.
There are two other areas of the bill which suffer from
inadequacy or from omission. There is the matter of unpaid
supplier provisions. Suppliers of goods are frequently in situations
in which a debtor has ordered a considerable amount of inventory
before being placed into bankruptcy or receivership. The supplier
is then left with an unsecured claim for the price of goods while
their value benefits the secured creditors who have charges on the
business' inventory.
This practice of stacking up an inventory for the benefit of
secured creditors is detrimental to the interests of the supplier.
There are provisions under the current act to give suppliers the
right to repossess merchandise delivered to a purchaser who
becomes bankrupt or who goes into receivership.
Nevertheless, these provisions have received criticism from the
financial community in which they say the availability of credit
would be reduced because lenders would no longer be able to count
on inventory as security for their loans. The matter is not dealt with
here and probably at some future time it will be. It has been
presented to the minister on more than one occasion. In each
instance he has decided not to do anything about it.
The third omission is the bill does not provide for the payment of
unpaid wages to workers whose employment was terminated as a
result of a bankruptcy, receivership or liquidation of their
employer. The matter was to have been the subject of a study by a
special joint committee of the House of Commons and the Senate.
That committee was to report in June 1993. That committee was
never established.
Instead, the wage claim payment program of the Bankruptcy and
Insolvency Act maintained a preferred creditor status for unpaid
wages, for unpaid wage claims, and increased the amounts that
could be claimed.
In the interests of the employees who are terminated as a result
of bankruptcy the matter should be revisited to determine whether a
fairer and more equitable provision for the affected employees can
be achieved.
There are a number of provisions in the bill which we can
support and there are a number of shortcomings which have been
addressed. While in general we will support the bill, I believe the
minister would be well advised to recognize there is a lot of work
left to be done to deal with those issues which must be addressed.
I underscore again that the real reason bankruptcy is so rampant
in the country today has to do with the financial situation, in
particular the fiscal situation, in which the country finds itself.
I encourage the Minister of Industry, who is leading this bill, and
the Minister of Finance together with the Prime Minister to put all
their efforts into one thrust to eliminate the deficit and begin to
control the debt so that our interest payments do not continue to
rise and we can once again have a fair and level playing field in
which private industry, private enterprise, can build a country
where all of us will have the economic freedom to spend our money
the way we want to, with a minimum of government interference,
and be successful in our endeavours so we will not have to deal
with bankruptcy.
The Acting Speaker (Mrs. Ringuette-Maltais): Is the House
ready for the question?
Some hon. members: Question.
The Acting Speaker (Mrs. Ringuette-Maltais): Is it the
pleasure of the House to adopt the motion?
Some hon. members: Agreed.
3037
Some hon. members: No.
The Acting Speaker (Mrs. Ringuette-Maltais): All those in
favour of the motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mrs. Ringuette-Maltais): All those
opposed will please say nay.
Some hon. members: Nay.
The Acting Speaker (Mrs. Ringuette-Maltais): In my opinion
the yeas have it.
And more than five members having risen:
The Acting Speaker (Mrs. Ringuette-Maltais): A recorded
division on the proposed motion stands deferred until 6.30 p.m.
[Translation]
Mr. Boudria: Madam Speaker, if you were to seek it, I believe
the House would give unanimous consent to suspend until 6.30
p.m., when we will take the deferred divisions.
The Acting Speaker (Mrs. Ringuette-Maltais): Is there
unanimous consent to suspend the sitting until 6.30 p.m.?
Some hon. members: Agreed.
(The sitting of the House was suspended at 5.52 p.m.)
_______________
The House resumed at 6.30 p.m.
* * *
The House resumed from May 17, 1996, consideration of Bill
C-20, an act respecting the commercialization of civil air
navigation services, as reported (with amendments) from the
committee.
The Acting Speaker (Mrs. Ringuette-Maltais): It being 6.30
p.m., the House will now proceed to the taking of the deferred
divisions at the report stage and second reading of Bill C-20, an act
respecting the commercialization of civil air navigation services.
Call in the members.
(1845)
Before the taking of the vote:
The Acting Speaker (Mrs. Ringuette-Maltais): The question
is on Motion No. l. A vote on this motion also applies to Motions
Nos. 2 and 3.
(Division No. 90)
YEAS
Members
Asselin
Axworthy (Saskatoon-Clark's Crossing)
Bellehumeur
Bernier (Gaspé)
Blaikie
Crête
Dalphond-Guiral
de Savoye
Deshaies
Duceppe
Fillion
Gagnon (Québec)
Godin
Guimond
Jacob
Lalonde
Langlois
Lebel
Loubier
Nunez
Picard (Drummond)
Plamondon
Solomon
Taylor
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)-26
NAYS
Members
Abbott
Adams
Allmand
Anawak
Anderson
Arseneault
Assad
Barnes
Bélair
Bélanger
Benoit
Bertrand
Bethel
Bodnar
Bonin
Boudria
Breitkreuz (Yorkton-Melville)
Brown (Oakville-Milton)
Brushett
Bryden
Byrne
Campbell
Cannis
Catterall
Chan
Cohen
Comuzzi
Cowling
Culbert
Cullen
Cummins
DeVillers
Dhaliwal
Dingwall
Dion
Discepola
Dromisky
Duhamel
Duncan
Epp
Fewchuk
Finestone
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Gilmour
Godfrey
Goodale
Gouk
Grey (Beaver River)
Grubel
Guarnieri
Harb
Harper (Churchill)
Hart
Harvard
Hayes
Hickey
Hopkins
Hubbard
Jackson
Jennings
Jordan
Keyes
Kirkby
Knutson
Kraft Sloan
Lastewka
Lee
Loney
MacAulay
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Manning
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
McCormick
McKinnon
McWhinney
Meredith
Mills (Red Deer)
Minna
Mitchell
Murphy
Murray
Nault
O'Brien (Labrador)
O'Brien (London-Middlesex)
O'Reilly
Pagtakhan
Paradis
Parrish
Patry
Payne
Peric
Peters
Peterson
Pettigrew
Pillitteri
Proud
Ramsay
Regan
Rideout
Ringma
Robichaud
Robillard
Schmidt
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
Solberg
Speaker
St. Denis
Steckle
Stewart (Brant)
Stewart (Northumberland)
Strahl
Szabo
Telegdi
Thalheimer
Thompson
Valeri
Verran
Wells
3038
Whelan
White (Fraser Valley West/Ouest)
White (North Vancouver)
Williams
Wood
Young
Zed-143
PAIRED MEMBERS
Alcock
Assadourian
Augustine
Bachand
Bakopanos
Beaumier
Bélisle
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Bevilacqua
Brien
Calder
Canuel
Caron
Cauchon
Chrétien (Frontenac)
Clancy
Collenette
Collins
Crawford
Daviault
Debien
Dubé
Dumas
Dupuy
Easter
Eggleton
English
Flis
Gauthier
Graham
Gray (Windsor West/Ouest)
Guay
Iftody
Landry
Laurin
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Marchand
McLellan (Edmonton Northwest/Nord-Ouest)
Ménard
Mercier
Mifflin
Milliken
Paré
Pickard (Essex-Kent)
Pomerleau
Reed
Rocheleau
Rock
Sauvageau
Speller
St-Laurent
Tremblay (Lac-Saint-Jean)
Ur
Vanclief
Venne
(1855)
The Acting Speaker (Mrs. Ringuette-Maltais): I declare
Motion No. 1 lost. I therefore declare Motions Nos. 2 and 3 also
lost.
The next question is on Motion No. 4. A vote on this motion also
applies to Motions Nos. 5 to 12, and 16 to 24.
Mr. Boudria: Madam Speaker, if you were to seek unanimous
consent, I believe the House would be disposed to taking the vote
on Motion No. 1 and applying it to Motions No. 4 and 15.
The Acting Speaker (Mrs. Ringuette-Maltais): Is that agreed?
Some hon. members: Agreed.
[Editor's Note: See list under Division No. 90.]
The Acting Speaker (Mrs. Ringuette-Maltais): I declare
Motions Nos. 4 and 15 lost. Consequently, Motions Nos. 5 to 12
and 16 to 24 are also lost.
[English]
The next question is on Motion No. 25. An affirmative vote on
Motion No. 25 obviates the necessity of putting the question on
Motion No. 26. A negative vote on Motion No. 25 necessitates the
question being put on Motion No. 26.
Mr. Boudria: Madam Speaker, if you were to seek it I believe
you would find unanimous consent that all hon. members who
voted on the previous motion be deemed to have voted on the
motion now before the House with Liberal members being
recorded as voting yea.
[Translation]
Mrs. Dalphond-Guiral: Madam Speaker, the members of the
official opposition will be voting nay.
[English]
Mr. Strahl: Madam Speaker, Reform Party members present
will be voting no on this motion.
Mr. Solomon: Madam Speaker, as whip of the New Democratic
Party caucus, NDP members present in the House today vote yea
on Motion No. 25.
(The House divided on Motion No. 25, which was agreed to on
the following division:)
(Division No. 91)
YEAS
Members
Adams
Allmand
Anawak
Anderson
Arseneault
Assad
Axworthy (Saskatoon-Clark's Crossing)
Barnes
Bélair
Bélanger
Bertrand
Bethel
Blaikie
Bodnar
Bonin
Boudria
Brown (Oakville-Milton)
Brushett
Bryden
Byrne
Campbell
Cannis
Catterall
Chan
Cohen
Comuzzi
Cowling
Culbert
Cullen
DeVillers
Dhaliwal
Dingwall
Dion
Discepola
Dromisky
Duhamel
Fewchuk
Finestone
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Godfrey
Goodale
Guarnieri
Harb
Harper (Churchill)
Harvard
Hickey
Hopkins
Hubbard
Jackson
Jordan
Keyes
Kirkby
Knutson
Kraft Sloan
Lastewka
Lee
Loney
MacAulay
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McCormick
McKinnon
McWhinney
Minna
Mitchell
Murphy
Murray
Nault
O'Brien (Labrador)
O'Brien (London-Middlesex)
O'Reilly
Pagtakhan
Paradis
Parrish
Patry
Payne
Peric
Peters
Peterson
Pettigrew
Pillitteri
Proud
Regan
Rideout
Robichaud
Robillard
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
Solomon
St. Denis
Steckle
Stewart (Brant)
Stewart (Northumberland)
3039
Szabo
Taylor
Telegdi
Thalheimer
Valeri
Verran
Wells
Whelan
Wood
Young
Zed -119
NAYS
Members
Abbott
Asselin
Bellehumeur
Benoit
Bernier (Gaspé)
Breitkreuz (Yorkton-Melville)
Crête
Cummins
Dalphond-Guiral
de Savoye
Deshaies
Duceppe
Duncan
Epp
Fillion
Gagnon (Québec)
Gilmour
Godin
Gouk
Grey (Beaver River)
Grubel
Guimond
Hart
Hayes
Jacob
Jennings
Lalonde
Langlois
Lebel
Loubier
Manning
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
Meredith
Mills (Red Deer)
Nunez
Picard (Drummond)
Plamondon
Ramsay
Ringma
Schmidt
Solberg
Speaker
Strahl
Thompson
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)
White (Fraser Valley West/Ouest)
White (North Vancouver)
Williams-50
PAIRED MEMBERS
Alcock
Assadourian
Augustine
Bachand
Bakopanos
Beaumier
Bélisle
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Bevilacqua
Brien
Calder
Canuel
Caron
Cauchon
Chrétien (Frontenac)
Clancy
Collenette
Collins
Crawford
Daviault
Debien
Dubé
Dumas
Dupuy
Easter
Eggleton
English
Flis
Gauthier
Graham
Gray (Windsor West/Ouest)
Guay
Iftody
Landry
Laurin
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Marchand
McLellan (Edmonton Northwest/Nord-Ouest)
Ménard
Mercier
Mifflin
Milliken
Paré
Pickard (Essex-Kent)
Pomerleau
Reed
Rocheleau
Rock
Sauvageau
Speller
St-Laurent
Tremblay (Lac-Saint-Jean)
Ur
Vanclief
Venne
(1900)
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): I declare
Motion No. 25 carried.
[English]
Hon. David Anderson (Minister of Transport, Lib.) moved
that the bill, as amended, be concurred in.
The Acting Speaker (Mrs. Ringuette-Maltais): Is it the
pleasure of the House to adopt the motion?
Some hon. members: Agreed.
Some hon. members: No.
The Acting Speaker (Mrs. Ringuette-Maltais): All those in
favour of the motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mrs. Ringuette-Maltais): All those
opposed will please say nay.
Some hon. members: Nay.
The Acting Speaker (Mrs. Ringuette-Maltais): In my opinion
the yeas have it.
Mr. Boudria Madam Speaker, I believe you would find
unanimous consent to apply in reverse the results of report stage
Motion No. 1.
The Acting Speaker (Mrs. Ringuette-Maltais): Is there
unanimous consent for the motion?
Some hon. members: Agreed.
(The House divided on the motion, which was agreed to on the
following division:)
(Division No. 92)
YEAS
Members
Abbott
Adams
Allmand
Anawak
Anderson
Arseneault
Assad
Barnes
Bélair
Bélanger
Benoit
Bertrand
Bethel
Bodnar
Bonin
Boudria
Breitkreuz (Yorkton-Melville)
Brown (Oakville-Milton)
Brushett
Bryden
Byrne
Campbell
Cannis
Catterall
Chan
Cohen
Comuzzi
Cowling
Culbert
Cullen
Cummins
DeVillers
Dhaliwal
Dingwall
Dion
Discepola
Dromisky
Duhamel
Duncan
Epp
Fewchuk
Finestone
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Gilmour
Godfrey
Goodale
Gouk
Grey (Beaver River)
Grubel
Guarnieri
Harb
Harper (Churchill)
Hart
Harvard
Hayes
Hickey
Hopkins
Hubbard
3040
Jackson
Jennings
Jordan
Keyes
Kirkby
Knutson
Kraft Sloan
Lastewka
Lee
Loney
MacAulay
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Manning
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
McCormick
McKinnon
McWhinney
Meredith
Mills (Red Deer)
Minna
Mitchell
Murphy
Murray
Nault
O'Brien (Labrador)
O'Brien (London-Middlesex)
O'Reilly
Pagtakhan
Paradis
Parrish
Patry
Payne
Peric
Peters
Peterson
Pettigrew
Pillitteri
Proud
Ramsay
Regan
Rideout
Ringma
Robichaud
Robillard
Schmidt
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
Solberg
Speaker
St. Denis
Steckle
Stewart (Brant)
Stewart (Northumberland)
Strahl
Szabo
Telegdi
Thalheimer
Thompson
Valeri
Verran
Wells
Whelan
White (Fraser Valley West/Ouest)
White (North Vancouver)
Williams
Wood
Young
Zed-143
NAYS
Members
Asselin
Axworthy (Saskatoon-Clark's Crossing)
Bellehumeur
Bernier (Gaspé)
Blaikie
Crête
Dalphond-Guiral
de Savoye
Deshaies
Duceppe
Fillion
Gagnon (Québec)
Godin
Guimond
Jacob
Lalonde
Langlois
Lebel
Loubier
Nunez
Picard (Drummond)
Plamondon
Solomon
Taylor
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)-26
PAIRED MEMBERS
Alcock
Assadourian
Augustine
Bachand
Bakopanos
Beaumier
Bélisle
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Bevilacqua
Brien
Calder
Canuel
Caron
Cauchon
Chrétien (Frontenac)
Clancy
Collenette
Collins
Crawford
Daviault
Debien
Dubé
Dumas
Dupuy
Easter
Eggleton
English
Flis
Gauthier
Graham
Gray (Windsor West/Ouest)
Guay
Iftody
Landry
Laurin
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Marchand
McLellan (Edmonton Northwest/Nord-Ouest)
Ménard
Mercier
Mifflin
Milliken
Paré
Pickard (Essex-Kent)
Pomerleau
Reed
Rocheleau
Rock
Sauvageau
Speller
St-Laurent
Tremblay (Lac-Saint-Jean)
Ur
Vanclief
Venne
The Acting Speaker (Mrs. Ringuette-Maltais): I declare the
motion carried.
* * *
[
Translation]
The House resumed consideration of the motion that Bill C-31,
an act to implement certain provisions of the budget tabled in
Parliament on March 6, 1996, be read the third time and passed.
The Acting Speaker (Mrs. Ringuette-Maltais): The House
will now proceed to the taking of the deferred division on the
motion for third reading of Bill C-31.
[English]
Mr. Boudria: Madam Speaker, I believe you would find
unanimous consent that members who voted on the previous
motion be recorded as having voted on this motion, with Liberal
members voting yes.
[Translation]
Mrs. Dalphond-Guiral: The members of the official opposition
will be voting nay, Madam Speaker.
[English]
Mr. Strahl: Madam Speaker, Reform Party members present
will be voting no on this motion.
Mr. Solomon: Madam Speaker, NDP members present will vote
no on this matter.
(The House divided on the motion, which was agreed to on the
following division:)
(Division No. 93)
YEAS
Members
Adams
Allmand
Anawak
Anderson
Arseneault
Assad
Barnes
Bélair
Bélanger
Bertrand
Bethel
Bodnar
Bonin
Boudria
Brown (Oakville-Milton)
Brushett
Bryden
Byrne
Campbell
Cannis
Catterall
Chan
Cohen
Comuzzi
Cowling
Culbert
Cullen
DeVillers
Dhaliwal
Dingwall
3041
Dion
Discepola
Dromisky
Duhamel
Fewchuk
Finestone
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Godfrey
Goodale
Guarnieri
Harb
Harper (Churchill)
Harvard
Hickey
Hopkins
Hubbard
Jackson
Jordan
Keyes
Kirkby
Knutson
Kraft Sloan
Lastewka
Lee
Loney
MacAulay
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Marchi
Marleau
Martin (LaSalle-Émard)
Massé
McCormick
McKinnon
McWhinney
Minna
Mitchell
Murphy
Murray
Nault
O'Brien (Labrador)
O'Brien (London-Middlesex)
O'Reilly
Pagtakhan
Paradis
Parrish
Patry
Payne
Peric
Peters
Peterson
Pettigrew
Pillitteri
Proud
Regan
Rideout
Robichaud
Robillard
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
St. Denis
Steckle
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Thalheimer
Valeri
Verran
Wells
Whelan
Wood
Young
Zed-115
NAYS
Members
Abbott
Asselin
Axworthy (Saskatoon-Clark's Crossing)
Bellehumeur
Benoit
Bernier (Gaspé)
Blaikie
Breitkreuz (Yorkton-Melville)
Crête
Cummins
Dalphond-Guiral
de Savoye
Deshaies
Duceppe
Duncan
Epp
Fillion
Gagnon (Québec)
Gilmour
Godin
Gouk
Grey (Beaver River)
Grubel
Guimond
Hart
Hayes
Jacob
Jennings
Lalonde
Langlois
Lebel
Loubier
Manning
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
Meredith
Mills (Red Deer)
Nunez
Picard (Drummond)
Plamondon
Ramsay
Ringma
Schmidt
Solberg
Solomon
Speaker
Strahl
Taylor
Thompson
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)
White (Fraser Valley West/Ouest)
White (North Vancouver)
Williams-54
PAIRED MEMBERS
Alcock
Assadourian
Augustine
Bachand
Bakopanos
Beaumier
Bélisle
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Bevilacqua
Brien
Calder
Canuel
Caron
Cauchon
Chrétien (Frontenac)
Clancy
Collenette
Collins
Crawford
Daviault
Debien
Dubé
Dumas
Dupuy
Easter
Eggleton
English
Flis
Gauthier
Graham
Gray (Windsor West/Ouest)
Guay
Iftody
Landry
Laurin
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Marchand
McLellan (Edmonton Northwest/Nord-Ouest)
Ménard
Mercier
Mifflin
Milliken
Paré
Pickard (Essex-Kent)
Pomerleau
Reed
Rocheleau
Rock
Sauvageau
Speller
St-Laurent
Tremblay (Lac-Saint-Jean)
Ur
Vanclief
Venne
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): I declare the
motion carried.
(Motion agreed to, bill read the third time and passed.)
* * *
The House resumed consideration of the motion that Bill C-36,
an act to amend the Income tax Act, the Excise Act, the Excise Tax
Act, the Office of the Superintendent of Financial Institutions Act,
the Old Age Security Act and the Canada Shipping Act be read the
second time and passed.
The Acting Speaker (Mrs. Ringuette-Maltais): The House
will now proceed to the taking of the deferred division on the
motion at second reading stage of Bill C-36.
Mr. Boudria: Madam Speaker, I think if you were to ask it, you
would find unanimous consent to apply the result of the vote taken
on the previous motion, that is third reading of Bill C-31, except
that the hon. Minister of Finance will not be recorded as having
voted on the motion now before the House for reasons of interest.
(1905)
Mrs. Dalphond-Guiral: The members of the official opposition
will vote against, Madam Speaker.
3042
[English]
Mr. Strahl: Madam Speaker, Reform Party members present
will voting no unless some would like to do otherwise.
Mr. Solomon: Madam Speaker, New Democrat members in the
House vote no on this motion.
(The House divided on the motion, which was agreed to on the
following division:)
(Division No. 94)
YEAS
Members
Adams
Allmand
Anawak
Anderson
Arseneault
Assad
Barnes
Bélair
Bélanger
Bertrand
Bethel
Bodnar
Bonin
Boudria
Brown (Oakville-Milton)
Brushett
Bryden
Byrne
Campbell
Cannis
Catterall
Chan
Cohen
Comuzzi
Cowling
Culbert
Cullen
DeVillers
Dhaliwal
Dingwall
Dion
Discepola
Dromisky
Duhamel
Fewchuk
Finestone
Fontana
Fry
Gaffney
Gagliano
Gagnon (Bonaventure-Îles-de-la-Madeleine)
Gallaway
Gerrard
Godfrey
Goodale
Guarnieri
Harb
Harper (Churchill)
Harvard
Hickey
Hopkins
Hubbard
Jackson
Jordan
Keyes
Kirkby
Knutson
Kraft Sloan
Lastewka
Lee
Loney
MacAulay
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Marchi
Marleau
Massé
McCormick
McKinnon
McWhinney
Minna
Mitchell
Murphy
Murray
Nault
O'Brien (Labrador)
O'Brien (London-Middlesex)
O'Reilly
Pagtakhan
Paradis
Parrish
Patry
Payne
Peric
Peters
Peterson
Pettigrew
Pillitteri
Proud
Regan
Rideout
Robichaud
Robillard
Scott (Fredericton-York-Sunbury)
Shepherd
Sheridan
Simmons
Skoke
St. Denis
Steckle
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Thalheimer
Valeri
Verran
Wells
Whelan
Wood
Young
Zed-114
NAYS
Members
Abbott
Asselin
Axworthy (Saskatoon-Clark's Crossing)
Bellehumeur
Benoit
Bernier (Gaspé)
Blaikie
Breitkreuz (Yorkton-Melville)
Crête
Cummins
Dalphond-Guiral
de Savoye
Deshaies
Duceppe
Duncan
Epp
Fillion
Gagnon (Québec)
Gilmour
Godin
Gouk
Grey (Beaver River)
Grubel
Guimond
Hart
Hayes
Jacob
Jennings
Lalonde
Langlois
Lebel
Loubier
Manning
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
Meredith
Mills (Red Deer)
Nunez
Picard (Drummond)
Plamondon
Ramsay
Ringma
Schmidt
Solberg
Solomon
Speaker
Strahl
Taylor
Thompson
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)
White (Fraser Valley West/Ouest)
White (North Vancouver)
Williams-54
PAIRED MEMBERS
Alcock
Assadourian
Augustine
Bachand
Bakopanos
Beaumier
Bélisle
Bergeron
Bernier (Mégantic-Compton-Stanstead)
Bevilacqua
Brien
Calder
Canuel
Caron
Cauchon
Chrétien (Frontenac)
Clancy
Collenette
Collins
Crawford
Daviault
Debien
Dubé
Dumas
Dupuy
Easter
Eggleton
English
Flis
Gauthier
Graham
Gray (Windsor West/Ouest)
Guay
Iftody
Landry
Laurin
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Marchand
McLellan (Edmonton Northwest/Nord-Ouest)
Ménard
Mercier
Mifflin
Milliken
Paré
Pickard (Essex-Kent)
Pomerleau
Reed
Rocheleau
Rock
Sauvageau
Speller
St-Laurent
Tremblay (Lac-Saint-Jean)
Ur
Vanclief
Venne
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): I declare the
motion carried.
3043
(Motion agreed to, bill read the second time and referred to a
committee.)
* * *
The House resumed consideration of the motion that Bill C-5, an
act to amend the Bankruptcy and Insolvency Act, the Companies'
Creditors Arrangement Act and the Income Tax Act, be now read a
second time and passed.
The Acting Speaker (Mrs. Ringuette-Maltais): The House
will now proceed to the taking of the deferred division on the
motion at second reading of Bill C-5.
[English]
Mr. Boudria: Madam Speaker, I believe you would find
unanimous consent that members who voted on the main motion
for third reading of Bill C-31 be recorded as having voted on the
motion now before the House, with Liberal members voting yes.
[Translation]
Mrs. Dalphond-Guiral: The members of the official opposition
will vote no, Madam Speaker.
[English]
Mr. Strahl: Madam Speaker, Reform Party members present
will be voting yes unless some would like to do otherwise.
Mr. Solomon: Madam Speaker, New Democrat members this
evening will vote no on this matter.
[Editor's Note: See list under Division No. 92.]
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): I declare the
motion carried, and the bill referred to the Standing Committee on
Industry.
(Motion agreed to, bill read the second time and referred to a
committee.)
_____________________________________________
3043
ADJOURNMENT PROCEEDINGS
[
Translation]
A motion to adjourn the House under Standing Order 38 deemed
to have been moved.
Mr. Osvaldo Nunez (Bourassa, BQ): Madam Speaker, I would
like to start by commenting on the extraordinary work that has been
done by the Canadian Council for Refugees. I salute the organizers
and delegates who are this week, May 29 to June 1, attending a
four-day conference in Winnipeg. At this conference, hands-on
workers in the field will be exploring the various avenues and
solutions to the problems experienced by refugee claimants in
Canada. I hope that their reflections will help contribute to
improving the cause of refugees in Canada and in the rest of the
world.
(1910)
This past April 29, I asked a question of the Minister of
Citizenship and Immigration concerning the deportation of
Algerians. For some months the Bloc Quebecois has been
demanding the suspension of returns to Algeria, given the rise of
fundamentalism and the atmosphere of violence in that country. A
report published March 14 by the American Secretary of State is
very clear on this.
In light of this explosive situation, I am seriously questioning
why the minister and his employees insist on continuing to deport
Algerian nationals. It is distressing to see that Canada has gone so
far as to espouse such immigration policies. This lays open to
question its international reputation as a country which welcomes
those whose fundamental rights have been violated, including the
rights relating to their very survival. In so doing, the leaders and
the public servants of this country, a country that boasts of being a
great defender of all humanitarian causes, is making a mockery of
its international commitments.
I would like to take advantage of this opportunity to speak out
vigorously against the methods being used by the Department of
Citizenship and Immigration. The complaints against these agents
of removal by those deported, by lawyers and organizations
defending immigrants and refugees are endless and are of the
highest concern to me.
I would like to illustrate these remarks with two examples. The
first dates back to May 8, when Immigration Canada decided to
deport Saadi Bouslimani, a 29-year old Algerian denied refugee
status. Two days later, we learn that he was not deported. He ended
up in the infirmary at the Parthenais detention centre in Montreal
for treatment of wounds to his head, neck and feet. He had been
struck by an immigration official.
The second example is that of a Zairian national, Biha Munsi,
who was drugged in order to be deported on February 23, 1994,
while she was pregnant. I criticized this practice in the House at the
time.
I wonder who orders the use of drugs and unnecessary force in
the deportation of a recalcitrant individual.
This brings me to the advisory committee looking at conditions
in countries where people are deported. The aim of this committee
is to advise the Minister of Citizenship and Immigration on
countries at risk and on the dangers threatening the survival of
people Canada is preparing to deport to their countries. Since the
composition, role and power of this committee is totally nebulous
in terms of the department's organization chart and in terms of its
operations, we could describe it as a phantom committee.
3044
Because of the mystery surrounding this advisory committee,
because of the aberrations and the arbitrary policies emanating
from the Department of Citizenship and Immigration, I would ask
the minister to affirm her leadership of this department she
theoretically heads, to look more realistically and objectively at
the Algerian situation and to review the $500 cost to apply for
residency on humanitarian grounds.
[English]
Ms. Maria Minna (Parliamentary Secretary to Minister of
Citizenship and Immigration, Lib.): Madam Speaker, it does not
help anyone for the member opposite to give misinformation. He
knows full well specific cases cannot be discussed in detail in the
House because of confidentiality. Also he knows full well it is not
the policy of the government to drug people and to use violence.
The hon. member knows full well that is not acceptable.
I also remind the hon. member that, as the minister has
previously stated in the House, departmental policy concerning
removals to different countries must be based on an individual case
examination. Many countries are troubled by civil unrest and
terrorist violence but few are so overwhelmed that it becomes
necessary for the department to suspend removals to that country.
(1915)
At present the department has temporarily suspended removals
to only three countries: Rwanda, Burundi and Afghanistan. The
citizens of these three countries have faced a level of violence and
personal suffering so great that they have been forced to flee their
homes and abandon their possessions. The situation in Algeria,
while regrettable and distressing, does not compare to that of these
countries.
The decision to suspend removals is made upon the advice of an
Advisory Committee on Country Conditions for Removals. This
committee meets on a regular basis to review the overall conditions
of countries. In making its recommendation, it considers materials
produced by representatives of the department, the Immigration
and Refugee Board documentation centre, respected international
sources like the UNHCR and the International Organization for
Migration as well as other documents forwarded by
non-governmental organizations.
Removals are only carried out once all rights of appeal and due
process have been exhausted. Before the department makes the
decision to remove anyone from Canada, the circumstances of their
case are carefully reviewed and all factors are considered. All
people in our society have use of the full extent of the law of
appeals.
In the case of Algeria, the advisory committee recognized that
despite the obvious risk of living in the area, the majority of the
population chooses to remain. Industry, commerce and agriculture
continue. The country's transportation and communications
systems function and people travel into and out of Algeria for
various purposes, including family visits and business.
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): The motion to
adjourn the House is deemed to have been adopted. The House
stands adjourned until 10 a.m. tomorrow.
(The House adjourned at 7.18 p.m.)