1991-11-26

Mr. Allan Koury (Hochelaga-Maisonneuve):: Mr. Speaker, I have the honour to present, in both official languages, the report of Legislative Committee B on Bill C-39, an act to amend the Canada Pension Plan, the Family Allowances Act and the Old Age Security Act, without amendment.
[Editor's Note: See today's Votes and Proceedings.]


PETITIONS
Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, I have the honour and the privilege under Standing Order 36 to present a petition signed by a number of grain and oilseed producers in Canada who are experiencing severe shortages of cash flow because of the present prices for agricultural commodities.
Your petitioners ask this House to convince the government to provide immediate assistance for these cash-strapped farmers.


Mr. Brian L. Gardiner (Prince George -Bulkley Valley):: Mr. Speaker, I have the pleasure and the duty to present a petition to the House today. It is a very important petition. It is signed by residents primarily from the central interior of British Columbia and it is
regarding water diversion projects. They call upon Parliament to urge the government to state categorically that it will not permit our freshwater rivers to be dammed and diverted into the U.S.A. and to state that our Canadian rivers are not for sale.


Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, I have the honour to present a petition from people in Malartic, La Motte, Saint-Mathieu, Riviere-Heva, Cadillac and Dubuisson in Abitibi who say that preventive withdrawal for pregnant women is a necessary and desirable option for working women.
For these reasons, they ask Parliament, when it reviews the Canada Labour Code, to consider seriously the deficiencies in it and to recognize the need to include in the Code clauses concerning preventive withdrawal for pregnant women, with pay.


Ms. Catherine Callbeck (Malpeque):: Mr. Speaker, it is my pleasure today to rise and present a petition signed by many Canadian farmers. They state that grain and oilseed producers are experiencing the most severe shortage of cash flow in the history of the industry.
They call on the Government of Canada and they humbly pray that it will see fit to provide more assistance to them in their severe problems.


Mr. Rex Crawford (Kent):: Mr. Speaker, once again I am honoured to rise in the House pursuant to Standing Order 36 and present a petition on behalf of farmers from western Ontario. They state that the Government of Canada has failed to provide sufficient cash flow assistance to farmers during the transition from the old ad hoc programs to the new safety net programs in order that farmers may meet their financial obligations and preserve the family farm. The undersigned petitioners humbly pray and call upon Parliament to urge the government to provide such assistance as proposed by

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the House of Commons Standing Committee on Agriculture on August 29, 1991.


QUESTIONS ON THE ORDER PAPER
Mr. Albert Cooper (Parliamentary Secretary to Minister of State and Leader of the Government in the House of Commons):: Mr. Speaker, I ask that all questions be allowed to stand.


The Acting Speaker (Mr. DeBlois):: Shall all questions stand?


Some hon. members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Monday, November 25, consideration of Bill C-4, an act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters, as reported (with amendments) from the Standing Committee on Finance; and the motion of Ms. Callbeck (p. 5309).
Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, when we adjourned yesterday we were in the process of dealing with an amendment by my good colleague from Malpeque in connection with clause 329 of the bill.
We have examined very closely the amendment of the member for Malpeque and find that the French version of her amendment is quite satisfactory, but the English version needs a slight change in connotation. I have circulated to my friend and to you, Sir, a copy of that English version. I believe there would probably be agreement of the House that the amendment I am producing be accepted and with that acceptance that the
government would be prepared to support the amendment produced by my colleague from Malpeque.


The Acting Speaker (Mr. DeBlois):: The House has heard the motion tabled by the hon. member for Mississauga South. Is there unanimous consent to agree to that motion?


Some hon. members:: Agreed.
Amendment (Mr. Blenkarn) agreed to.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question on Motion No. 47?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion, as amended?


Some hon. members:: Agreed.
Motion No. 47, as amended, agreed to.


The Acting Speaker (Mr. DeBlois):: Motions Nos. 41A and 46A are grouped for debate.
[Translation\


Hon. Monique Vezina (for the President of the Treasury Board and Minister of State (Finance)) moved:: Motion No. 41A.
That Bill C-4 be amended in Clause 313 by striking out line 38 on
page 160 and substituting the following:
"accounting principles, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants. "
Motion No. 46A.
That Bill C-4 be amended in Clause 328 by striking out line 29
on page 167 and substituting the following:
"auditing standards, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants."


Donald Alex Blenkarn: Mr. Speaker, the legislation in this place is also legislation in the other place.
Over the past two or three weeks the other place has been considering the bills now before the House. The other place has made some suggestion that is contained in Motions Nos. 41A and 46A on the Order Paper.
That suggestion is that the House include in the analysis of accounting practice the handbook of the
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Canadian Institute of Chartered Accountants that is published with respect to what is good accounting practice.
The government is prepared to accept that. The government believes that that only adds certainty to what is good accounting practice. It certifies that class of action and we think it is not a bad idea to do that.
We are quite in agreement with the suggestion from the other place. I think that should meet the satisfaction of the House.
I move that the amendments be proceeded with.


Catherine S. Callbeck: Mr. Speaker, I, too, would agree with the hon. member from MississaugaI think it is an amendment which will improve the legislation. Therefore I will vote for the motion.


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, we have no problems with those two motions.
As a matter of fact I am glad to see that they are using the handbook of the Canadian Institute of Chartered Accountants as a standard. I trust that they will also be open to some of the suggestions from the institute with respect to making the system even safer.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: The vote on Motion No. 41A will apply to Motion No. 46A.
Is it the pleasure of the House to adopt Motion No. 41A?


Some hon. members:: Agreed.
Motion No. 41A agreed to.


John R. Rodriguez: Motion No. 42A.
That Bill C-4 be amended in Clause 319 by striking out line 41 at
page 162 and substituting the following therefor:
"ling annual meeting, appoint two auditors, who shall be independent of each other, to".

He said: Mr. Speaker, the purpose of this amendment is to require that financial institutions appoint two auditors rather than a single auditor.
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At present the Bank Act requires two auditors. Other financial institutions have one auditor. It was amazing that while we were in committee the government and the Official Opposition even changed the requirement of two auditors for a bank to one auditor for a bank. The banks wanted to have two auditors. I think it is safe to say that. They wanted that extended to some of these other financial institutions. In fact now more than ever, when all of these changes are completed, we have all of this commingling, this intermingling where banks can own trust companies, where banks can own insurance companies, insurance companies can own trust companies. When you have all of this,-


An hon. member:: Cannibalism.


John R. Rodriguez: -this cannibalism, and that is a good word to describe it, when we have had all of this feeding frenzy, the situation will become even more complex. I am afraid, as much as I have a lot of faith in the regulatory agency, OSFI, I want to say that OSFI is incapable of doing an audit on these.
OSFI depends on the auditors' reports. In 1980, the Economic Council of Canada found that there were external and internal factors for the failures. The dominant ones were the internal factors. These all have to do with questionable loan practices. Questionable practices were also discovered whereby managers attempted to secure gains for themselves at the expense of depositors and investors.
OSFI depends on these internal and external auditor's reports. I want to quote Michael Mackenzie's evidence before the committee when we were looking at Standard Trust. Michael Mackenzie is the Superintendent of Financial Institutions.
Mr. Mackenzie said, and I quote him, and this was in his evidence before the Standing Committee on Finance on June 13, 1991:
We said we relied on these financial statements that you audit as primary evidence of the financial soundness of the company. In that context, if there are conditions or transactions that you know will effectively threaten the solvency of the company, your duty is to tell the management and tell us at the same time. If you see transactions that are beyond the powers of the company, you are to do the same.
Then we went on to state that we wanted to review their working papers so we established a framework of reliance here that did not exist before. To me in this case we had put the auditors on notice. We relied on them to do the loan examination at that time. If for example there were these undue loan concentrations and so forth, there is a sense in which if they are infracting the Ontario or the federal act's lines or

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rules on asset concentrations, we would have expected them to report
to management and to report to us at the same time.
The point I am trying to make there and that Mr. Mackenzie makes is that it shows how dependent OSFI is on the auditors' reports.
OSFI does not do on sight auditing of all the financial institutions in the country. They depend on these reports.
When the Canadian Institute of Chartered Accountants came before us, it recommended two auditors. We support the audit appointment provisions for banks set out in Bill C-19 which (a) provide for dual auditors to be appointed for large banks, (b) provide for a minimum threshold to determine which banks must appoint dual auditors and (c) do not require banks to rotate auditors.
They go on to point out in the brief that major banks are an essential part of the Canadian economy and it is essential to maintain widespread confidence in the economy.
The banking industry is highly concentrated. A few very large institutions account for a very large part of commercial lending. The effectiveness of the auditing system is therefore particularly important to the positive confidence upon which the the continued functioning of Canadian capital markets ultimately rests. A reservation in the auditor's report, whereby a disagreement with the bank would be made public, could damage the confidence of depositors and in extreme cases could cause a run on the banks. Auditors may therefore be perceived as extremely hesitant to express a reservation of opinion.
The importance of auditors at the present moment in a highly concentrated banking system is ultimately important. Imagine how much more concentrated it is going to get when all of these bills get passed. Already you see the urge to merge. You see trust companies looking for partners. Insurance companies are buying out trust companies.
It seems to me that there is a need to protect the interests of the depositors and dual auditors is a requirement.
We all remember the collapse of the CCB and the Northland Bank. At that time the Hon. Willard S. Estey was appointed commissioner to look into the failure of those two banks. His recommendation No. 20 is particularly important. This is what Justice Estey recommended.
It is recommended that no change be made to the dual auditor
system as provided by Section 2(37) of the Bank Act.
We have ample evidence that the two auditor system provides safety and assurance to depositors. What did the Liberals and the Conservatives do in the committee? Not only did they increase the amount of external auditing in the financial institutions, they simply said to the banks: "You do not have to give two auditor reports anymore, only one." They wish to reduce the auditors to one. I cannot understand it. I find it very very incomprehensible that these bills are going to allow a complete restructuring of financial institutions.
I suggest that we are not going to have myriads of financial institutions across the country anymore. We will have a smaller number of very large banks, financial institutions, whose primary aim is to compete globally. That is all I hear from the Conservatives in the government. "We have to be global competitors." Now I am starting to hear it from the Liberals who since last weekend have discovered global competition.
That is where Bills C-4, C-19, C-28 and C-34 are taking financial institution structure in this country. They are reducing financial institutions to a veiy small number where competition will not be introverted but extroverted. In other words, we are going to have to depend on the American Expresses of this world to provide Canadians at home with the competition. We are going to depend on financial institutions outside of Canada to come in here and provide the competition. The competition will not be generated from within the country.
In the midst of this we have had problems with financial institutions such as Standard Trust and Principal Trust which I understand were in the provincial jurisdiction. It cost the Canada Deposit Insurance, which is the Canadian taxpayer, some $200 million to $300 million to bail out Standard Trust depositors. We keep picking up the pieces.
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There is no doubt that the amount of money which has come out of taxpayers' pockets to support the deposit insurance for trust companies and banks that have failed is about equal between banks and trust and loan companies. In the last dozen years there have been only a couple of large banks in the west that have failed. What we paid out through the deposit insurance for those two banks was equalled by all the trust and loans companies that have gone under.
Since the regulator depends on the audits of financial institutions, it does not seem fair to depositors and the taxpayers of Canada that this is the time to be easing up on the brake. It seems to me the argument I am making is for more scrutiny, not less scrutiny. That is one of the ways that we have been able to keep confidence in the system.
I am prepared to state, because I have stated it previously many times, the Canadian banking system has a lot of integrity in Canada and in the world. The Canadian banks that have been developed with the regulatory systems we have in place are some of the safest financial institutions in the world.
If we look at the Japanese banks, the German banks and the American banks, for God's sake, Canadian banks are far superior. We have been able to regulate them and because we have had the brakes on, they have been able to develop and grow.
The member for Mississauga South should take cognizance of this amendment and reverse the mistake he made in the committee of reducing dual auditors in banks to one. Let us extend the dual auditor system to the financial institutions across the country.


Donald Alex Blenkarn: Mr. Speaker, I want to thank the hon. member for Nickel Belt for his concern. There is no question that the system depends on auditors, it depends on actuaries and it depends on top quality reporting. That is the reason this bill and the other bills that will follow deal very extensively with the duties of auditors, the requirement to report, the requirement to certify and all of those requirements that are there.
The question is: Would two be better than one?
I have the advantage of having been around this matter for a long time. In the spring of 1985 the finance committee conducted a major study into the problems of
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the refinancing of the Canadian Commercial Bank. I remember very clearly a situation where we had a representative from the Clarkson company and a representative from Peat Marwick and company before us. When we got into the issue of what happened, one auditor looked at the other and said: "Well, Alphonse, weren't you going to do that?" The other one said: "That was your responsibility".
This business of having two auditors and saying two is better than one is like saying that two drivers to steer a car is better than one. It is such nonsense. The fact is that we need to have one person responsible as the auditor, one firm responsible. Let us make sure that firm has responsibilities, let us make sure that firm does its work right, but let us not try to say that if you have two you are going to be better off. As a practical matter, you are not.
What we have right now is a rotating system where an auditing firm, under the banks anyway, works for a veiy short period of time, a year, and then is off the case. The problem is that it takes a length of time for a firm to really get a grip on the intricacies of the internal accounting system.
It is my view and the view of the government that we have been allowing things to slip for too long by pretending to rely on two auditors when in fact there is very little protection that way at all. Indeed, you really need to have one who is responsible and you have to make sure that you can pin the responsibility on that one firm.
The arbitrage that goes on right now where there are situations of two auditors is not acceptable.
I understand some members of the Canadian Institute of Chartered Accountants would like us to expand then-work. I understand things are tough today out in the field and the more work you can get the better and the more retainers you can get the better and that would be fine. I suppose that is a good way of feather-bedding, if you want to put it that way.
I am surprised at my friend from Nickel Belt wanting to sponsor that feather-bedding. I am surprised he does not realize just how much better off we are with one auditor than two. That is the reason why the finance committee suggested for Bill C-19, which will follow, the one auditor and that is, of course, the reason why we

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ought to remain in the one-auditor context in terms of trust companies and insurance companies.
May I point out that we have operated well with one auditor. Canada Trust is certainly larger than some of our banks, perhaps larger than the Canadian National Bank. I must say that there is no real merit in saying one will not do because one does well and does very well and that is the way we ought to keep it. We ought to keep the situation where we have one auditor responsible, one auditor subject to the very detailed requirements that this bill and the companion bills require and impose upon that auditing firm.
While we believe that we ought to follow through with the Canadian Institute of Chartered Accountants handbook as a method of standard, we believe that standard is best enforced when you make one person, one firm, responsible for the work. When you have one person responsible then you know where to put the blame if there is a problem. When you wind up with that problem defused it is after you, Alphonse, and we have had enough of after you, Alphonses.


Catherine S. Callbeck: Mr. Speaker, amendment 42A. which states that trust companies should have two auditors was actually discussed in the finance committee. This amendment that we have before us this morning actually contradicts the decision that was made in the finance committee which would allow a trust company to choose whether it needed one auditor or two.
Under the existing legislation, trust companies have one auditor. The Superintendent of Financial Institutions and the finance committee, as I mentioned a minute ago, felt that there was no obvious reason why we should require trust companies to have two auditors. In fact, as the hon. member for Mississauga has stated, and it was also indicated in the finance committee, there is a possibility if you have two that one auditor could believe that the other auditor was doing something that he is not and things could get missed. The hon. member for Nickel Belt mentioned the Estey inquiry which looked into the failure of the Canadian Bank and the Northland Bank. I want to remind him that Mr. Estey stated in that inquiry that the auditor system of having two auditors would not have made any difference at all to these two banks. Why would chartered banks want to have two auditors. That makes work. We also have to remember that auditors cost money and really, who is going to end
up paying the price tag? It is the customer or the trust company.
If I felt that it was absolutely necessary that a trust company should have two auditors, then certainly I would vote for this amendment. Obviously, from what we heard in the finance committee, and as I said, the Superintendent of Financial Institutions does not see any reason for this, I do not see any reason why we should inflict this cost on the Canadian public. If it is an unnecessary cost, why make the trust company customers pay for it?
I repeat, this was brought up in the finance committee. We voted against it. The Superintendent of Financial Institutions does not see any reason for it so, therefore, I will be voting against it.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say, yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(a), a recorded division on the motion stands deferred.
Motions Nos. 58 and 60 standing in the name of the hon. member for Nickel Belt are grouped for debate.


John R. Rodriguez: Motion No. 58.
That Bill C-4 be amended in Clause 416 by striking out line 31 at
page 214 and substituting the following therefor:
"(2) Except as permitted in the Act or the regulations, a company shall not act in Canada as".
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Motion No. 60.
That Bill C-4 be amended in Clause 416 by adding immediately after line 42 at page 214 the following:
"(4) A company may, with the prior consent of a customer, provide an insurance company, agent or broker with information respecting the customer.
(5)	A consent given pursuant to subsection (4) shall be contained in a separate document that deals only with subject matter of the consent."

He said: Mr. Speaker, Motion No. 58 would allow the regulations to permit companies to engage in certain activities of an insurance agent or to provide space in a branch to a person engaged in the placing of insurance.
I want to just briefly repeat the position we have taken with respect to the whole deregulation of the financial institutions scene as envisaged in these bills.
We have said that insurance companies ought to do things that are related to insurance companies; banks, things that are related to banking; trust and loan companies, things that are of a fiduciary nature related to trust and loan companies. This is the position we have taken. We therefore have no objection to a bank marketing insurance through its branches. We have no problem with that, but we have real concerns. We oppose banks owning insurance companies because we see the breakdown of the system and a concentration of economic power in a few hands. That is a concern. The one fallout from that is the consumer. We have argued that banks ought to be allowed to market insurance through then-branches.
Many of the insurance companies which appeared before the finance committee said: "Oh, no, you cannot allow that at all. You cannot allow that because if you allow them to market insurance they are going to twist the arms of the consumer, they are going to tight sell, and a whole host of other nasty things". As it turns out many of those large insurance companies which came before the finance committee own financial institutions, trust companies, in Europe. Lo and behold, guess what they do in Europe? Those financial institutions that are owned by the insurance companies here in Canada market insurance through their branches. The question was put to them: Do those financial institutions that you own in Europe use all of these nasty practices: tight
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selling, arm twisting, and a whole host of other things, to get the consumer to buy your insurance products? Of course not. They do not do it. They do not do it at all.


An hon. member:: So they say.


John R. Rodriguez: Yes. We pointed out, Mr. Speaker, that in fact there is evidence, contrary to what the Liberal critic said yesterday, there were studies done in the United States which show in fact that this marketing of insurance through financial institution branches brings down the cost of insurance.
It was interesting after that that those hearings received publicity. I received a letter on April 24, 1991. The member from Mississauga South would be interested because this is a gentleman who has an insurance brokerage in Mississauga. He writes to me, "Dear Mr. Rodriguez", and he goes through the issues, and he says: "The comments about over-priced policies and dividends is a potshot of McLeod's at Mutual, which pays dividends on its policies". He is talking here about Professor McLeod, who appeared before the finance committee and was very critical of the insurance companies. "McLeod correctly points out that the dividends on return of an overpayment of premium and that is why they are not taxed.
Mutual Life is owned by the policyholders, not by shareholders. This means that for practical purposes management does not have to answer to anyone. For example, Mutual Life recently changed agents over to level commissions. They are to receive 20 per cent for life of new premium sales. Under the old system they received 80 per cent in year one, 20 per cent in year two and 5 per cent thereafter. The agents complained that the combination of the old renewals and the new level commissions would put them below a living income. Mutual solved the problem by agreeing to pay the new commission on the existing business too. This means the old business is being charged for commissions twice". Is that not marvellous? As a salesman I would love to get paid twice on my book of business. "However the owners of the insurance companies would object to cost". Mutual Life has no owners to complain.
Fourth, on the subject of competition, I enclose a partial listing of the companies in Canada. I assure the House that there are a fair number I had never heard of until I read this list. Many of these companies were created for specific limited purposes and not for general

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sales to the public. Many are not active outside their province or head office.
There are, however, still lots of insurance companies available to the public. Unfortunately the public does not shop around for life insurance. If it did, as we can see by the survey there are some companies that should get very little business.
Members of the public do not shop around. They buy from the company agent who approaches them. The agents of the big companies that represent about 80 per cent of the market have contracts which specifically prohibit them from recommending the insurance of any company other than their own.
The banks would add a new level of competition in that they would write business for which they may have gone to a life company agent.
The lack of real competition, however, is contributable to the domination of the industry by the few large companies that field their own exclusive agents. While I have nothing against companies fielding exclusive agents, I do resent their success and stifling competition.
For example, in Ontario which is probably the largest market in Canada brokerage is specifically prohibited, that is in Ontario an agent is not allowed to represent more than one company except for the Insurance Act which he enclosed a copy of. He goes on to say that if the banks sell the companies they own not much would change in this picture. The clients still would not be shopping around and the seller would be selling for only one company. This may be what MacLeod was referring to when he said that he could see no advantage to the consumer of banks owning insurance companies.
He said: "Personally I think the public could only gain if the banks worked as agent brokers. They could then compete on insurance costs as they do on loan rates. Would this require a change in the provincial laws that prohibit or restrict brokerage? The public would benefit if there was a lot more activity pushing inexpensive term insurance. Bank clerks could be trained to sell a lot of this type of insurance. Canadians, in my opinion, are over premium and under-insured".
That is Jim Bulloch. He has an insurance brokerage in Mississauga. There is an informed opinion of what goes on in the industry. It is one that makes the argument for the banks to market insurance.
I was just reading an article in The Financial Post the other day that makes the same argument in a different way. It points out, for example, that Sun Life Assurance of Canada has integrated its Sun Life Trust branches with its insurance operations. This allows the insurance agents to provide trust services to clients and permits clients to buy GICs and arrange mortgages over the telephone.
That is one of the other arguments we heard, that bank clerks are not trained to sell insurance. We have a whole pile of insurance agents out there on the telephone and in person selling financial products. They sell RRSPs, annuities, GICs, and now they are selling mortgages over the telephone. What is the point? What is this argument for training?
We have taken this position that the banks ought to be able to market insurance through their branches. They should not be allowed to own the insurance companies.
Turning to my other motion, Motion No. 60, even if the government gets its way and separates the insurance operation from the bank operation and if the bank owns an insurance company and has a separate operation, it is forbidding the bank, even with the customer's approval, to send information to the insurance subsidiary of the bank. My Motion No. 60 says on matters relating to insurance that with the customer's signed approval that information ought to be passed on to the bank's subsidiary. It seems to me that makes some sense.
I go into a branch where I do all my banking and I want to get insurance. The bank manager says: "I am sorry, I cannot talk to you about that. You will have to go to the directory and see where our branch is located and go over there and talk to them". I have to go there and give them all the information that I have given to the bank with respect to the insurance purchase.
It seems to me that my amendment would give the right to the customer. The right rests with the customer. If the customer wants the information to be passed on to the bank's subsidiary for insurance then he ought to be able to sign that and that information ought to go over to the subsidiary. It seems to me that is even proposed by
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the owner of one of the largest insurance companies. Power Corporation has recommended that and it owns Great West Life. It seems to me that it has also recommended that the customer should have the right to authorize the bank to send the information to the insurance subsidiary.


Donald Alex Blenkarn: Mr. Speaker, it is the principle of the bill that insurance companies do insurance, trust companies do trust work, and banks do banking work. If trust companies want to be involved in insurance work they have to own an insurance company, and the same applies with the other organizations.
The reason for that is to make sure that we keep a separate way of handling each of the separate and distinct pillars of financial intermediation.
My friend has some idea that he can reverse that, that he could have everybody doing everybody's work but the ownership separate. We have discussed this for a long time. I am sure the House will realize that from what my friend had to say in debate. The issue has been well thought out, well debated over a long period of time.
I know my friend has been reading letters from very important and valued constituents in Mississauga. I guess the organizations that he and others belong to have had a number of conferences and a number of meetings and have gone over and discussed this. People involved in consumer affairs have gone through this issue. This has been a matter that has been worked out over a long period of time. Indeed it was the original suggestion of the finance committee in our 1985 report that the ownership be the way it is in the thrust of these bills but that strong walls be there to prevent intermingling of activity without the licence to do it.
We have a situation here which we have had for some considerable period of time. We want to continue with the situation that trust companies will not use their offices to sell or deal or advise on insurance. If a trust company wants to be involved in insurance or be related to an insurance company then it can cause to be incorporated a company or buy a company and have a separate company for the insurance operation.
The same applies with respect to trust operations and the like. If it is desirable to have some of the same personnel involved, that is a question of licensing per-
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sonnel, but the offices have to be kept separate and the businesses policed separately.
The effect of what we want to see happen is the way these bills are organized. We believe that is in the best interest of the public generally. There may be argument, and my friend has presented his argument and there are people who would support my friend's argument, but the vast preponderance of people involved who know anything about this matter of intermediation and people concerned about the public interest accept and believe the way it is being proposed in these bills is the way that we ought to go.
It is with great regret, I must say, that we cannot at all support these amendments.


Catherine S. Callbeck: Mr. Speaker, on Motion No. 58 regarding the amendment that a trust should be able to act as an agent, this amendment was already dealt with in the finance committee and it was defeated. I do not see any reason for this amendment. We do not believe that trust companies should be able to sell all types of insurance.
The current trust legislation allow trusts to act as an agent for their customers in certain insurance transactions. For example, if you are going on a trip and you want travel insurance, you can go into your trust company and get it; the trust company can act as an agent. The finance department is on record as saying that trusts will be able to continue to do this under Bill C-4. Therefore, I do not see any reason for that amendment and we will be voting against it.
With regard to Motion No. 60, respecting the passage of information to insurance companies with the customer's consent, here again I am speaking against this amendment. We do not believe that trust companies should be able to sell all types of insurance. This would violate that ban. What would happen is that banks with their massive data bases would pass on to insurance companies huge lists of their customers that they could then use for target marketing. While a qualified insurance representative would be making the sale, the enormous resources the bank would have could easily lead to unequal competition and major disruptions in the industry.

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For those reasons we will be voting against these amendments.


The Acting Speaker (Mr. DeBIois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBIois):: The question is on Motion No. 58. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBIois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBIois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBIois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBIois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.
The next question is on Motion No. 60. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBIois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBIois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBIois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBIois):: Pursuant to Standing Order 76(8), a recorded division on the motion is deferred.


Catherine S. Callbeck: Motion No. 68.
That Bill C-4 be amended by adding immediately after line 16 at page 227 the following new clause:
"444. (1) A company must use plain language in all contracts related to financial services, applications for financial services and related documents which it provides to its customers who are natural persons.
(2)	Subsection (1) does not apply to words or forms of documents that are prescribed by law.
(3)	Subsection (2) does not apply to contracts, applications for financial services and related documents where the price of the financial service or the total liability assumed or to be assumed by the customer exceeds two hundred and fifty thousand dollars.
(4)	Proof that reasonable efforts have been made by the company to comply and maintain compliance with subsection (1) is a complete defence (a) in a prosecution under subsection (1), or (b) in a dispute about whether subsection (1) has been complied with.
(5)	The failure of a company to comply with subsection (1) does not affect the enforceability of any document referred to therein and may not be asserted by a customer or a company as a defence in an action or proceeding based on a document referred to in subsection (1).
(6)	As used in this section "customer" includes a natural person who is a guarantor or provides security to a company.
(7)	Subsections (1), (2), (3), (4), (5) and (6) shall come into force on the day which is two years after the coming into force of section 1 of this Act."
-Mr. Speaker, I am pleased to propose this amendment which is an amendment entitled "plain language". It requires trust companies to put into plain language various documents used by customers.
I am sure that from time to time you probably have had the experience where you looked at a document of a trust company and found that not only is it very difficult to read because it is in very fine print but also it has a lot of legal terminology.

November 26, 1991

I am proposing this amendment because I feel it is important that customers are able to read a document and understand what it is. Therefore it focuses on the needs of the reader or the consumer. It involves using short sentences and everyday words and would make the document easy to follow.
I do not think that customers should have to receive applications and contracts that are difficult to follow and difficult to understand exactly what is contained in them.
I want to acknowledge that some progress has been made in this regard with some financial institutions. I certainly thank them for that. But there is a lot more that needs to be done and the industry will acknowledge this. I have put before us this morning a "plain language" amendment which is legislation that is in several states of the United States at the moment. New York first introduced it in 1978 and I believe there are at least 10 states at the moment that have enacted plain language statutes.
Here in Canada the only province that has plain language legislation is Alberta which passed this in 1990.
In looking at the New York model, the results of this amendment are reported to be impressive. Experts there argue that a legal requirement for plain language is needed and that one just cannot leave this up to the voluntary initiatives. As I stated earlier the trend has been started in Canada. Some financial institutions have started putting their forms in plain language and readable language that the average customer can understand. But experts indicate that if this is really going to be accomplished right straight through it needs to be put into legislation. That is why I am moving this amendment.
I believe it is a reasonable amendment. It gives the financial institutions two years to get their documents into plain language. Furthermore, they are only required to do so with small customers such as those who borrow less than $250,000.
I think this is an amendment which certainly will be very beneficial for consumers using the services of trust companies. I would urge the House to support it.


Donald Alex Blenkarn: Mr. Speaker, I very much appreciate the thrust of the member's concern. I have always felt that a great deal of our legislation is far too complicated for the ordinary person to read. The same of course applies to contracts in some cases. But the trouble is how to define "plain language".
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If one could define plain language we would be all set. I suppose that would be either English or French plain language. The trouble is that what is plain to me may be exceptionally complicated to you. We have a difficulty right at the outset understanding what is plain language.
I suppose to put that spirit of making things readable and easily understandable and so on in legislation itself becomes exceptionally difficult. How can you legislate and say that this language is not plain but that language is plain? What is a plain linguistic operation?
I do not know. I am afraid I have got to say that while I very much appreciate the spirit of the amendment it is not an amendment that we can support because we just do not have any mechanism to adjudicate the issue of whether the language is plain or whether the language is convoluted.
I do not suppose that would be easy to do. For example, would we be faced with a situation on a contract of insurance or a contract of deposit that is required as a result of long studies in English law and court case after court case in determining what is really required? We could have a judge say: "The contract is set aside because in my view this particular contract is not plain enough".
Issues like time of the essence clauses that are required have a long history of litigation behind them. Notice clauses have a long history of litigation behind them.
I very much respect my friend's intention but I must say that the damage that she is trying to cure is going to create more damage in the cure than the cure proposed.
I believe what we have to do is rely on the industries that are in the business of marketing their product to market something that people can read. A number of institutions are doing that. They are being very careful how they lay it out to people they propose to deal with. They are doing that because they want to be able to say: "You can take a look at our contract and anybody can read it".
I think we ought to leave it at that. I believe we would only create litigation, controversy and problems if we were to support this amendment.


Mr. Maurice A. Dionne (Miramichi):: Mr. Speaker, I want to support my colleague from Prince Edward Island on the plain language suggestion. I do not believe that it is as difficult as my hon. friend from Mississauga says to put contracts into plain language. Plain language means very simply that it is language that can be understood by

November 26, 1991
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a person who is reasonably intelligent and can read and write.
It has been known for a long time or it has been suspected at least for a long time by many people that contracts are made deliberately difficult in order to bamboozle rather than to enlighten. It is not beyond the realm of linguists to devise a plain language contract. The sooner that happens the better it will be in my opinion both for the industries and for individuals.
In this day and age there can be no rational argument not to put contracts and other legal niceties into plain and simple clear language. I am sure that that will pertain in both of the official languages of this country.
I say let us get on with doing that as soon as possible without any further delays and the kind of logic that my friend has brought in to this debate.


Don Boudria: Mr. Speaker, I only want to take a moment to speak on this particular issue.
I do agree with my hon. colleague from Mississauga that it is not always easy to define what plain language is. However, some things are obvious. I will just give you an example that derives from our own practices here in this House. Have you ever tried to explain to a constituent why our petition forms are preambled the way they are? I have presented petition forms to constituents who sent me back a blast in a letter asking me who did I think I was using language like that to make sure they did not understand. We ask the House of Commons to "humbly sheweth". How many people in this world would know what "humbly sheweth" is or what it does?


An hon. member:: It means to shoe a horse.


Don Boudria: Obviously it is well intentioned but we do not use Shakespearian English today in this House, nor elsewhere generally in society. The language has gradually evolved into something else.
I have come to the conclusion that some of the language utilized in some insurance contracts has not evolved along with the rest of the language. It is about time we modified that. My colleague from Malpeque has indicated previously that other jurisdictions have done it, so it is not a matter of us re-inventing the wheel. Other jurisdictions have done it. Maybe in some jurisdictions some elements have not worked. That is possible but we
have their experience to draw from. There are some 10 jurisdictions that operate in the system which at least to a degree resembles our forms at least in administration of justice.
If other liberal democracies have utilized a simpler form of language in order to at least tiy to make these documents understandable by some people who cannot understand them now, then we have achieved something.
I agree that some documents are harder to read than others. That is obvious.

Just think of how Le Devoir is written, for instance. It is well-known but not quite as easy to understand as other newspapers.
The same thing happens with legislation when we adopt a style of writing that can be much more complex than usual, and sometimes for no reason. We could make an effort to try and use, if at all possible, words that are a bit easier to understand than those we find in the existing legislation.

I had an occasion about a year ago of reading my automobile insurance policy. It is a shame that I did not think to bring it here this morning and read excerpts from it. It is not entirely clear to me that it is even the English language that is utilized in it. It sounds remotely similar but not very close. It is something entirely different to what we are used to listening to as a language in everyday English.

Presumably the wording of the French version is equally hard to understand.

I think our colleague has given us something to think about very seriously and we should consider it favourably. Plain language is not as easy to define as it could be but most people recognize gobbledegook when they see it.


The Acting Speaker (Mr. DeBIois):: Is the House ready for the question?


Some hon. members:: Question.
November 26, 1991


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


Some hon. members:: On division.


The Acting Speaker (Mr. DeBlois):: I declare the motion negatived on division.
Motion No. 68 negatived.


John R. Rodriguez: Motion No. 78.
That Bill C-4 be amended by adding immediately after line 19 at page 244 the following new clause:
"460. Notwithstanding anything in sections 453 to 459, no company may acquire or increase a substantial investment in a body corporate
(a)	if the body corporate is an insurance company to which Parts I to VII of the Canadian and British Insurance Companies Act apply or an insurance corporation incorporated by or under an Act of the legislature of a province; or
(b)	if the activities of the body corporate are substantially similar to those of a body corporate described in paragraph (a)."
He said: Mr. Speaker, earlier I said that it was the thinking of this party that in the financial institution structure, each institution ought to do the things for which it has received the patent, or licence.
Banks are to deal with things that relate to banking, insurance companies with things that are related to insurance companies, trust and loans with things that are related to trust and loan companies. We believe that the pillar structure has served the financial institutions of this country very well. Banks have grown in Canada, trust and loan companies have grown and insurance companies have grown. As a matter of fact, there has not been an insurance company in Canada that has gone broke since insurance companies came into being, largely because we had a pillar structure and we regulated the pillars.
I understand things have changed. I understand that there are a lot of cross pillar synergies going on. We now have to deal with this new reality where in fact they are doing each other's business so to speak, running around the ends of the pillars. We have no objection to banks entering into joint venture arrangements with insurance companies. They do it with creditor insurance for exam-
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pie. When you take out a loan the loan is insured. The bank does not insure the loan, but it has entered the joint venture with x insurance company that insures the loan. Mortgage insurance is similar where a joint venture is entered into with an insurance company to insure mortgages.
It seems to me that we have no problem with those joint ventures, those kinds of networking arrangements which are disclosed and regulated. That is the whole principle of the question of banks marketing insurance.
This particular amendment would prohibit a trust and loan company from owning an insurance company. I tell you that we have thrown up the spectre of what is going to happen when they start buying each other. In fact if you look at the market right now, the smaller trust companies are recognizing that they cannot survive with this upcoming legislation. Many of them are now looking for a bed fellow. Many of them are looking for a partner.
I want to tell you that you are going to see a period of merging going on that will make your head spin. At the end of the day, when it is all done, you are going to end up with the super financial institution. It will have subsidiaries but it will all be one super pocket. When that happens, we will have a concentration of economic power the likes of which we have never seen in this country.
This amendment is one of the ways we want to put the animals back in their cages. It attempts to do that.
I have heard the hon. member for Mississauga South say insurance companies should do insurance, banks should do banking. In fact, I want him to explain to me how it is that an insurance company can sell such financial instruments as RRSPs and GICs and what does an annuity have to do with insurance. It is a financial arrangement once you hit the magic 90 that you are going to live forever. What is so magic about that? Why is that not an instrument that a bank can sell? It does not make any sense to me.
What makes sense is recognizing a joint venture arrangement. That makes a lot more sense than forcing financial institutions to go out and either buy an insurance company, if they want to get involved in the full ramifications of what this legislation will provide, or else start one.

November 26, 1991
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It does not seem to make any sense because that is going to be very costly in the long run. Only the large and powerful institutions will be able to do that in any event.
This amendment is in keeping with the philosophy that we have expressed throughout. The pillar system has built a very sound financial institution structure in this country. It has served Canadians very well. In some mad dash to deregulate, we will end up throwing out the baby with the bath water.
I warn the danger inherent is that you are going to have a meltdown. One morning you are going to wake up and find just as the Californians did, that there are really only two banks in all of California and now one is buying the other, so there will be only one bank in California, just one.
We see the deregulation in the United States and what it is doing to financial institutions there. What is happening is a meltdown in the United States. They are buying out each other. They are bailing each other out. They are going to have large humungous institutions.
I ask the members of the House to consider positively this amendment. I think it will make sure that the pillar system remains, but will allow the joint venturing and networking which we have no problem with.


Donald Alex Blenkarn: This amendment is an attempt to turn the clock back, and the clock is not going to go back very easily. There are 20 insurance companies and trust companies already sharing ownership. To all of a sudden go with this amendment and prohibit the acquisition of one by the other would not wash with the realities of today.
The fact is that we are keeping the pillars of intermediation separate. In the thrust of all of the bills, we are allowing one institution to acquire another institution or be related to it in cross-ownership, but again operating separately.
I understand my friend's philosophy, but it is not the philosophy of the legislation. It is not the philosophy that has generally been accepted by people in all branches of the intermediation industry. I understand my friend's wanting to establish a new order, but the new order is not one that is acceptable to anyone in the financial industries, or to very many people in the financial industries anyway. The consequence is that we cannot accept my friend's decision to try to rewrite the way things are going.


Catherine S. Callbeck: Mr. Speaker, as the hon. member for Mississauga South has mentioned presently in Canada at least 20 insurance companies now own a trust company or are part of a conglomerate that owns a trust company. In view of that it only seems logical that trusts should be able to own insurance companies.
We hear concerns expressed about corporate concentration, and certainly that is a concern that I have. But there are two ways that would be dealt with. First, there is the Competition Act, which applies to any questionable acquisitions and second, there is the Minister of Finance. He can refuse a merger that would not serve the best interests of the Canadian financial system.
Another fact I would like to point out is that six out of the top 10 large Canadian insurance companies are takeover-proof. What I mean by that is that they are mutuals. They are owned by the policyholders and, therefore, cannot be taken over.
Finally, the Conference Board of Canada told the finance committee when we were reviewing the financial institution legislation that it sees no competition problems if trusts are given the power to buy insurance companies.
For those reasons we will be voting against this amendment.


Mr. Bill Blaikie (Winnipeg Transcona):: Mr. Speaker, it seems to me that the debate on this amendment, if I understand it correctly, illustrates the difference between the two basic approaches being taken here by the government and by the NDP. The government seeks to maintain the appearances of the four pillar system on which our financial industry has been based over the years whereas we are seeking to maintain the reality of that pillar system.
Having said that, it seems to me that what we have here with this-as the hon. member for Nickel Belt called it- mad rush to deregulate is really a mad rush to imitate. It is a mad rush to mimic what we see going on south of the border which is so very, very symptomatic of other things that we have seen. With respect to this issue I would say as I might say with respect to others: What is the origin and the locus of this self hate for Canada and Canadian institutions and the Canadian way of doing things that we find on the other side of the House? What has happened? I did not realize that I grew up in such a bad country with all these things that needed to be
November 26, 1991

changed: the way we ran our transport system, the way we ran our health care system and you name it. I had no idea that I lived in such an abominable society, that it needed to be so radically altered and so radically Americanized.
That is what is going on. We see here a kind of self loathing on the part of the government that everything Canadian has to be mutated and altered and made more like the Americans in some way or another. This is pathological. This is a deep, deep psycho-political sickness on the part of the government and it reaches into everything. Everything is being touched by this sickness of having to imitate. Let us get rid of anything that is Canadian, anything that worked and that made, in this case, for a very sound financial system, one of the soundest in the world. My God, it is an embarrassment. There may be people or institutions that cannot make all the money they want to make and this reduces our self image. We are not a place where people can be real greedy guts, they can only be half greedy guts so, let us change it.
I just do not understand it and I find this whole mess the government is entering into here to be just another symptom of this malaise that unfortunately affects the whole country. If the Conservatives just want to bring themselves down it would not be so bad, but they are taking a very good country with them.


Mr. Simon de Jong (Regina-Qu'Appelle):: Mr. Speaker, I also would like to intervene in the debate. The amendment that is being proposed by my colleague from Nickel Belt would prohibit trust companies from acquiring insurance companies.
This is part of our whole general thrust in opposing the government's resolutions and motions that would radically alter and change our financial institutions.
Yesterday, when I spoke on some of the other amendments I brought up the question of public interest. My friend from Mississauga South talked about the interest of the insurance companies and the trust companies, but he really did not explain how this would be in the public interest.


An hon. member:: They do not seem to care about this.
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Simon Leendert de Jong: The concern I have as this government moves along in this legislation, and my colleague from Nickel Belt yesterday put into the record, is with the comment made by the former chairman of the finance committee during hearings of the finance committee, that this was a cut deal. I asked where was the public interest when the insurance companies and the banks and the life insurance companies and so forth sat down and worked out this deal.
It is up the government to protect the public interest. It is up to the government to demonstrate, when it moves legislation through this House that the public will benefit, that the public will be protected. Yet as we hear government spokesmen defending this legislation, not once have I heard them attempt to justify anything on the basis of public interest. They are here representing the interests of the insurance companies, the trusts and the banks, but their job is to protect the interest of the public and they are not doing that. They are protecting the interests of the banks and the trusts and so forth, but not the public. They are not doing their job. They are negligent in fulfilling their job of protecting the public interest.
Is it in the public's interest to have the few large financial institutions that take deposits and so forth to own trusts and insurance? Is it in the public's interest to see the money they deposit in institutions being used somehow to acquire insurance companies, to be used to expand the commercial and other financial interests of this trust or bank, whatever the case may be?
It is the government's job to ensure that when people put their money into a deposit that the banks will do everything in their power to act in the best interest of those depositors and make certain that their deposits are not put at risk.
Now we have a situation where these deposit institutions can acquire other commercial ventures, other financial ventures. They might take the depositors' money and put that at risk for the sake of the financial interest of the commercial enterprise or the financial enterprise.
That is wrong. It will shake the trust people have in the deposit taking institutions. That will occur because we have the misfortune of having a government that did not act first and foremost to protect the public interest.

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With this particular amendment, I have not heard any justification from the government for allowing trust companies to own life insurance companies from the point of view of how this will serve the public interest. Therefore I cannot support the government's thrust and will support the amendments introduced by my colleague from Nickel Belt south.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: The question is on Motion No. 78. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
Pursuant to Standing Order 76(8), a recorded division on the proposed motion stands deferred.


Donald Alex Blenkarn: Mr. Speaker, on a point of order, earlier yesterday in connection with this bill, I had a discussion with my colleagues on the other side with reference to clause 484 of the bill to file an amendment.
If I can have the unanimous consent of the House to do that:
That clause 484 of Bill C-4 be amended by striking lines 32 and
33 on page 258 and substituting the following:
TWice the annual salary of the related party and $100,000.
The reason for this amendment is to bring this bill in line with Bill C-19. I will be making the same amendment with respect to Bill C-28 at a later stage.
It is just to make sure that all of these bills give the same powers, authorities, privileges and obligations as each to each other as we have in this package of financial legislation.


The Acting Speaker (Mr. DeBlois):: The house has heard the motion tabled by the hon. member for Mississauga South. Is there unanimous consent to adopt that motion?


Some hon. members:: Agreed.
Amendment (Mr. Blenkarn) agreed to.


Donald Alex Blenkarn: Mr. Speaker, I believe you will find there is unanimous consent that all the report stage amendments be put to the House on a vote at six o'clock with the report stage amendments that we might have for vote on the next orders of business for today, which would be Bill C-19 next and then Bill C-28 and Bill C-34.
I make that motion.


The Acting Speaker (Mr. DeBlois):: The House has heard the terms of the motion. Is there unanimous consent to defer the vote on the amendments?


Don Boudria: Mr. Speaker, there have been informal consultations and we are certainly agreeable to taking all of the votes at 6 p.m. tonight. But I was not under the impression that we would adopt a motion of the House to that effect. If I understand the procedure that is normally followed, if there is a vote to be taken on a bill, the division bells calling in the members will ring briefly until one of the two Whips, or his or her agent, approaches the table and ask for the deferred vote to be held at 6 p.m.
I do believe that we should follow that procedure at the present time. But there is certainly at least an informal agreement on my part and on the part of my colleagues that is the way we would like to go. But there could be unforeseen circumstances that happen between now and the taking of that vote which might change that. I suggest that motion be withdrawn and we continue the way we were, with the informal agreement that one of the Whips will ask for the vote to be deferred to 6 p.m. this afternoon.


The Acting Speaker (Mr. DeBlois):: So, as I see it, the motion need not be withdrawn, but there is not unanimous consent to adopt it.
November 26, 1991



The House will now proceed to the taking of the deferred divisions at the report stage of the bill now before the House.


[Stage Direction]
Call in the members.
[Stage Direction]

And the division bells having rung:
The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 45(a), I have been requested by the assistant opposition Whip to defer the division until a later time. Accordingly, pursuant to Standing Order 45(6), the recorded division on the question now before the House stands deferred until 6 p.m. today, at which time the bells to call in the members will be sounded for not more than 15 minutes.


BANK ACT
[Stage Direction]
The House proceeded to the consideration of Bill C-19, an act respecting banks and banking, as reported (with amendments) from the Standing Committee on Finance.

The Acting Speaker (Mr. DeBlois):: After considering the proposed amendments, the Chair is able to render a decision.

There are 30 motions in amendments set down on the Notice Paper for the report stage of Bill C-19, an act respecting banks and banking.

Motions Nos. 1, 4 and 5, standing in the name of the hon. member for Nickel Belt, are in order and will be grouped for debate. Motion No. 1 will be voted on separately. The vote on Motion No. 4 will apply to Motion No. 5.

Motions Nos. 1A, IB, 1C, 2C and this 10A standing in the name of the Minister of State (Finance) are pro-
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posed technical corrections to the French or English version of the bill. They are in order and will be grouped for debate with the vote on Motion No. 1A being applied to Motion Nos. IB, 1C, 2C and 10A.

Motion No. 2, standing in the name of the hon. member for Nickel Belt, and Motion No. 3, standing in the name of the hon. member for Malpeque, are in order and each will be debated and voted on separately.

Motions Nos. 2A and 2F standing in the name of the Minister of State (Finance) are in order and will be grouped for debate.
A vote on Motion No. 2A will apply to motion No. 2F.
Motions Nos. 2B, 2D, 2E, 2G, 3A, 3B, 3C, 3D, 3E, 3F and 3G standing in the name of the hon. member for Nickel Belt are in order and will be grouped for debate.
A vote on Motion No. 2B will apply to the 10 other motions.

Motions Nos. 6 and 11, standing in the name of the hon. member for Nickel Belt, Motion No. 7, standing in the name of the hon. member for Kingston and the Islands, and Motion No. 8, standing in the name of the hon. member for Ottawa-Vanier, are in order.
Motions Nos. 7 and 8 are identical. After consultation, I have decided to select Motion No. 8 for debate. Therefore, Motions Nos. 6, 8 and 11 will be grouped for debate. A vote in the affirmative on Motion No. 6 will obviate the need for a vote on Motion No. 8, while a negative vote on Motion No. 6 will require a vote on Motion No. 8. Motion No. 11 will be voted on separately.

The effective part of Motion No. 9 standing in the name of the hon. member for Nickel Belt was debated and negatived in the standing committee. For this reason the motion is not selected.
Motion No. 10 standing in the name of the hon. member for Malpeque and Motion No. 12 standing in the name of the Minister of State for Finance are acceptable and each will be debated and voted upon separately.

November 26, 1991
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To recapitulate: Motions Nos. 7 and 9 are not selected. [English]
Motions Nos. 1, 4 and 5 are grouped for debate. Motion No. 1 will be voted on separately. A vote on Motion No. 4 will apply to Motion No. 5.
Motions Nos. 1A, IB, 1C, 2C and 10A are grouped for debate. The vote on Motion No. 1A will apply to the four other motions.

Motions Nos. 2 and 3 will each be debated and voted on separately.

Motions Nos. 2A and 2F are grouped for debate. A vote on Motion No. 2A will apply to Motion No. 2F.
Motions Nos. 2B, 2D, 2E, 2G, 3A, 3B, 3C, 3D, 3E, 3F and 3G are grouped for debate. A vote on Motion No. 2B will apply to the 10 other motions.

Motions Nos. 6, 8 and 11 are grouped for debate. Motions Nos. 6 and 11 will be voted on separately but Motion No. 8 will be voted on only if Motion No. 6 is rejected.

Motions Nos. 10 and 12 will each be debated and voted on separately.
I will now propose Motions Nos. 1, 4 and 5 to the Elouse.


MEASURE TO ENACT
John R. Rodriguez: Motion No. 1.
(a)	the acquisition by a person, or entity controlled by a person, of up to 100 per cent of the shares of a bank or an entity that holds any share of a bank where the bank or entity to be acquired holds assets whose total value is less than ten billion dollars;
(b)	the acquisition by a person, or entity controlled by a person, of up to 75 per cent of the shares of a bank or an entity that holds any share of a bank where the bank or entity to be acquired holds assets whose total value is not less than ten billion dollars and not more than twenty billion dollars;
(c)	the acquisition by a person, or entity controlled by a person, of up to 50 per cent of the shares of a bank or an entity that holds any share of a bank where the bank or entity to be acquired holds assets whose total value is not less than twenty billion dollars and not more than thirty billion dollars;
(d)	the acquisition by a person, or entity controlled by a person, of up to 25 per cent of the shares of a bank or an entity that holds any share of a bank where the bank or entity to be acquired holds assets whose total value is not less than thirty billion dollars and not more than forty billion dollars; or
(e)	the acquisition by a person, or entity controlled by a person, of up to 10 per cent of the shares of a bank or an entity that holds any share of a bank where the bank or entity to be acquired holds assets whose total value exceeds forty billion dollars."
Motion No. 5.
That Bill C-19 be amended in Clause 381
(a)	by striking out lines 32 to 35 at page 198 and substituting the following therefor:
"acquired in accordance with subsection 377(2) shall, from and after the day determined pursuant to this section in respect of that bank, have and continue to have, voting shares that carry
(a) in the case of a bank referred to in paragraph 377(2)(h), 25 per cent,
(ib) in the case of a bank referred to in paragraph 377(2)(c), 50 per cent,
(c)	in the case of a bank referred to in paragraph 377(2)(cT), 75 per cent,
(d)	in the case of a bank referred to in paragraph 377(2)(e), 90 per cent,
of the";
(b)	striking out lines 2 to 20 at page 199 and substituting the following therefor
"the day that is five years after the day this Part comes into force."
That Bill C-19 be amended in Clause 23 by striking out lines 30	.
to 34 at page 20.	He said: Mr. Speaker, now that we have started the
Motion No 4	debate on Bill C-19, the Bank Act, you will notice that a
lot of the amendments that I have which were entered That Bill C-19 be amended in Clause 377 by adding immediately on Bill C-4, the Trust and Loan Companies Act, will be after line 15 at page 195 the following:	carried into the Bank Act. Many of the comments that
"(2) The Minister may approve only the following acquisitions:	we made with respect to Bill C-4 will apply to Bill C-19.
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The first one of these is Motion No. 1 which deals with the prohibition against the federal Crown establishing a bank.
I do not know what it is that motivates a government to apply what I consider to be medieval thinking to the state. Why does the government want to exclude the Crown from establishing a federal bank or a commercial bank? Why would we close the door to that option at this particular point?
Now we are embarking on deregulation of financial institutions. It is a deregulation of the financial institutions and we just do not know where this road is leading. The federal government in the past has established the FBDB as was pointed out by one of my colleagues yesterday and it has established the Bank of Canada. Yet here we have a prohibition against establishing a commercial bank. I just do not understand this medieval view which I have seen from time to time being expressed that somehow or other the state ought to exclude itself from having a bank.
We all are saying that we want to go into Europe and compete with the Europeans. We say Europe 92 is the way to go. Yet if you look at the European experience governments in Europe are right up to their armpits in commercial banking.
France is very involved in its commercial banking. The Germans are involved in their banking system. In this country we not only do not get involved in it we now turn around and bring in a law that says we cannot at all. We cannot have a bank.
I know our party has long held a policy that we wanted to nationalize a bank. I have serious doubts about that. I think that has probably been put on the back burner because who wants to go out and spend billions of dollars of the taxpayers' money buying one.
It seems to me that if we are going to get into the banking business the way to go is to start your own. That option is not at all open to us when this passes. Imagine a government that has such a jaundiced view of its own role and its own function that it would forbid itself the option of at some point maybe needing to have a window on the banking industry. By God when these bills pass this is going to be a different animal. The financial
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institutions of this country are going to be a different breed all together.
I once described them as animals. I gave them animal names in the form of a fable. I had them in their cages. The problem is somebody is opening up these cages.
Already the Royal Bank has got the lion as its symbol. It has got the globe and it is hugging the globe to its chest. That is very symbolic of where they are headed. That is the first thing. My amendment would give to the Crown and keep the option open to the Crown to establish a bank.
Second, I have the two other amendments namely Motions Nos. 4 and 5. No. 5 is consequential on No. 4. Basically Motions Nos. 4 and 5 look to what is happening with this legislation.
When we held hearings into the Bank Act and the Trust and Loans Act we found that Canada Trust for one is as big as the smallest of the five banks. Canada Trust says: "We would love to become a bank. We are growing. We would not mind becoming a bank". There is only one problem wrong with that. Canada Trust is owned by somebody else so the 10 per cent rule could not be applied to it.
My Motions Nos. 4 and 5 recognize that after this legislation gets passed some of these financial institutions are going to grow. It is quite possible that you can have a very large trust and loan company. It would be very large in actual size and yet the ownership could be closely held.
What we have said in this motion is to have a sliding scale of ownership. If you grow beyond a certain size then the way you protect the shareholders and investors is to have the wide ownership provision. This is the 10 per cent wide ownership provision that is applying to banks at the moment. They can decide. The larger you get the more widely held the ownership has to be. So the institution has options. It seems to me that sliding scale is a protection for depositors and it is a protection for investors and a protection for all Canadians because when they fail it is the taxpayers who pick up the tab. Let us not kid ourselves. The CDIC picks up the buck.
I know that colleagues yesterday mentioned Standard Trust. In that episode the taxpayers picked up roughly about $250 million. That came right out of the taxpayers' pockets. There was a closely held company and a small

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financial institution. But imagine now, given this legislation. It is a licence to grow big. The dangers are going to be there.
My Liberal and Tory colleagues got together to reduce the auditors to one. In a new sphere and in a new era we are going to have larger financial institutions. At the same time we are removing or not permitting the kinds of built-in controls such as the widely-held ownership control for larger financial institutions. I think it is a big mistake to dismiss the idea of two auditors given the size to which these financial institutions can now grow. They can grow and become sumo wrestlers as I have said time and time again in the past. They can represent Canada in global competition. I know that is where the Liberal Party is moving these days to join the Conservatives in this mad dash to get bigger and bigger and bigger and bigger. At the same time the well thought out sliding scale of the green paper in 1985 has been thrown out.
I know that the member for Mississauga South will say that is not in the cards because the financial institutions will not accept it. I want to remind members again that it is not the financial institutions which will decide what is best for Canada. Parliament decides that. It is the legislators of this country who decide what is best for Canada not a couple of overfed bankers and bagmen and bandits meeting in some room on Bay Street or on Bank Street deciding it. It is legislators who decide that. I am sorry the member for Mississauga South has broken with his past.


Donald Alex Blenkarn: Mr. Speaker, it is always entertaining to hear from my friend from Nickel Belt.
We have two amendments and the first amendment is in connection with governments incorporating commercially under this particular statute.
My friend will know that it has not been the policy of the Government of Canada under any government to allow a provincial government to incorporate a chartered bank and that prohibition remains in the Bank Act.
The federal government, if it wants to start doing something of that nature, would incorporate a bank by statute much the same as the federal government incorporated the Federal Business Development Bank and the Bank of Canada.
This bill is designed to handle the affairs of commercial banks.
Dealing with the scaled ownership amendments, Motions Nos. 4 and 5, my friend will know that all of the Schedule A banks in this country must be widely held in that no person or group of persons acting in concert can hold more than 10 per cent of the voting stock. That is the way we intend to keep it.
With respect to trust companies and Schedule B banks-we have a number of Schedule B banks in this country, and my friend will know that they are all foreign owned-they are now subject to the control limitations of $750 million in paid-in capital. If they exceed $750 million in paid-in capital they must subscribe to the rule that makes them divest up to 35 per cent of their ownership to Canadians in a widely held fashion.
I think my friend should accept that because it is a very important move in terms of making sure that those who come to this country to do banking operate in the same fashion as Canadians operate in this country. So Schedule B banks are required under the legislation, if they reach $750 million in paid-in capital, to start making their shares available in the marketplace to the extent of 35 per cent.
The sliding scale was well debated over a five year period. It was found on examination to be unacceptable at this time. I had something to do with making the suggestion of the sliding scale when I was chairman of the finance committee back in 1985, but the matter has been handled over a period of time. We have looked at this matter very carefully to see how we best could, as my friend said, protect the interests of the public and protect the interests of the nation. This particular format that we now have is viewed by everyone in the industries and by the government and respecting the interests of the individual as the best way we can proceed at this time.
I want to say to my friend with regard to the whole question of the Canada Trusts and the Royal Trusts of this world being narrowly controlled, massive organizations, that the act prevents them from becoming banks unless they become widely held. Perhaps that is as it should be. Canada Trust can, if it wants to, become widely held and become a bank. But unless it becomes widely held, it is the view at this stage that banks not be narrowly held in Canada. Once foreign banks pass $750 million in paid-in capital, they too must have market participation. We believe that this is the best framework at this time in terms of the ownership issue. The
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ownership issue has been debated and debated at great length and we believe that this is the best arrangement that can be arrived at today.


Catherine S. Callbeck: Mr. Speaker, with regard to Motion No. 1, which would give the government the power to own a bank, as I indicated yesterday we studied the whole financial institution legislation for over a year and we heard over 100 witnesses and never did we have a provincial government come and request this power.
Never did we have an individual or consumer group come before the finance committee and request that provincial governments be given the power to incorporate a bank.
As a result, this issue has not been studied by the committee and furthermore, a government which wishes to own a financial institution can do so by owning a provincial trust company, as has been done in Ontario and Alberta. For these reasons, we will be voting against that amendment.
With regard to Motions Nos. 4 and 5, this amendment would subject foreign Schedule 2 banks to a sliding scale in ownership. In other words, the larger the foreign bank the more widely it would have to be held.
The current Bank Act, as indicated by the hon. member from Mississauga, says that a foreign Schedule 2 may be closely held indefinitely unless it surpasses $750 million in capital through the acquisition of a Canadian financial institution. In that case it would be required to have 35 per cent of its shares in public ownership.
In Canada, trust and insurance companies will only have to meet that 35 per cent rule as opposed to the sliding scale that has been suggested. We see no reason whatsoever that foreign Schedule 2 banks should be treated any differently.
The current Bank Act allows foreign Schedule 2 banks to be closely held indefinitely. Certainly we have heard no evidence at the finance committee to make a spiel that there should be a change in this policy.
We will be voting against these amendments.


Simon Leendert de Jong: Mr. Speaker, the amendments being proposed today would allow the federal government to get into the commercial
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banking business. We have heard some spokespeople from the Liberal and the Conservative parties argue against that amendment.
It is not that we envisage in this amendment that the government would go off and nationalize a bank. I do not think that would make any sense. Certainly there might be occasions from time to time when this might make some sense, as in the earlier part of the last decade when we had the Canadian Commercial Bank and the Northland Bank going under.
It took a lot of the taxpayers' money to bail out the depositors through subsidization of the deposit insurance. Many of the depositors, especially in the Canadian Commercial Bank, were the banks because the Canadian Commercial Bank was offering quite an attractive interest rate on short term money.
Here we had the quite interesting situation where the government borrows money from the banks and pays interest on it and it is part of our deficit. Here we have the Canadian government borrowing money from the banks in order to pay the banks some moneys they would have lost with the collapse of the Canadian Commercial Bank.
I see our former chairman scratching his head and smiling. He knows that this was one of the ridiculous moments in Canadian high finance. We saved our great free enterprisers who took the risk in order to get a few basic points higher than interest rates. Surely they knew that the Canadian Commercial Bank was offering slightly higher interest rates which it needed to attract deposits. It was having problems. They knew they would eventually be able to get any money they were going to lose back from the Canadian government. It seemed to me at that moment that rather than the Canadian government using taxpayers' money to help save the depositors of those financial institutions, the Canadian government should have just taken them over and continued to operate them as commercial banks. It would have saved the Canadian public a lot of money. It would have saved some depositors some money. It certainly would have saved the Deposit Insurance Corporation money and it made sense. At that point it would have made sense if the Canadian government had taken over those two failing institutions and continued to operate them.

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Very often when a bank goes under it is because it had too many loans out in terms of real estate and the oil industry. This was the particular problem both with the Northland and the Canadian Commercial Banks. We also know that these are cyclical things. If we had been able to continue operating those financial institutions over a decade, some of the bad loans for mortgages on real estate that had declined in value would have been recovered as the value of that real estate went back up again.
I maintain that would have been an ideal opportunity for the government to acquire those institutions and continue to operate them. However, the legislation prohibits the government from doing that. If the government really wants to, it can go back and change the legislation, therefore why have it in the act in the first place?
It is not very often that we see something being legislated telling us what the government cannot do. In terms of the workings of this House it does not make sense. It is inappropriate to have in the act a statement saying that the government cannot do something. One begins to wonder why the government insists that it wants this in. I suspect it is trying to please other folks by giving another line of defence in case the government comes to a situation where it actually wants to operate a commercial bank. It would mean that the government would first have to bring that legislation to the House and amend it before proceeding to act on acquiring and setting up a commercial bank. It is an odd piece of legislation in the act and should not be there.
The other amendment that I think is important is the sliding scale. It originated from the former minister for financial institutions when she presented her green paper. Basically, it makes sense that trust companies which want to deal like banks are acquiring a lot of the powers of banks with this legislation. They will be able to do things that banks do. I agree with the bankers that "if it smells like a bank, if it walks like a bank and talks like a bank, then by golly, it becomes a bank". This is the situation we will arrive at in terms of the trust. So why not take it all the way and require some rules and regulations in terms of their ownership?
What the amendment proposes I think is quite modest. It proposes that a trust can be 100 per cent owned if it has assets of less than $10 billion. It has to divest part of its ownership if it has assets of no more than $20 billion. In other words if it has assets of $20 billion, no one individual or entity controlled by an individual can own more than 75 per cent of that trust.
With reference to the sliding scale, the third step is that no individual or entity controlled by an individual can own more than 50 per cent if the total assets reach $30 billion. No individual can own or control a trust for more than 25 per cent if the total assets are up to $40 billion. If it is over $40 billion what we require through this amendment is that no individual can control more than 10 per cent.
Those are not outrageous numbers. These are huge amounts of assets, wealth and power. Is it in the public interest to have so much power being concentrated in the hands of one individual?
It is not just us New Democrats making this point in this House even though we are a lonely voice here. A well respected international magazine The Economist had a November 9, 1991 article entitled "Canadian finance: Untrustworthy?" I wish to put on the record this quote:
The banks have long argued that allowing an industrial or commercial concern to control a financial institution is a recipe for disaster and mismanagement. The authorities in Ottawa have resisted their call to impose on trusts the wide ownership rules that apply to banks themselves. More trust company failures could prompt the government to think again.
One hopes and one wonders at what point will the government start thinking again.
We have seen during the eighties a number of trust companies going under. I think of Pioneer Trust in Regina. The workings, the management and the ownership of Pioneer Trust at the time I do not think should be held up as an ideal model. There were some questionable "business decisions". There were some suggestions of conflict of interest in there between the commercial interest of some of the directors and owners of that particular trust and the businesses that the trust was involved in, the type of loans it gave and the type of assets it looked at in terms of securing loans.
Imagine if Pioneer Trust had been a $10 billion or a $40 billion institution and the same type of mentality was occurring. Think of the the tremendous disaster it would
November 26, 1991

have created and the economic harm it would have done to Canada and to the depositors.
This amendment is about some form of protection to ensure that one or two individuals do not control so much power and assets that their wrongdoings can create a tremendous public harm to the country.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: On a point of order the hon. member for Nickel Belt.


John R. Rodriguez: Mr. Speaker, I notice that you did not read the motion.


The Acting Speaker (Mr. DeBlois):: Order, please. The vote has been asked for. I do not have the authority to stop the procedure.
Is it the pleasure of the House to adopt Motion No. 1?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(8), the vote is deferred.
The vote on Motion No. 4 will apply to Motion No. 5.
Is it the pleasure of the House to adopt Motion No. 4?
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Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.
Motions Nos. 1A, IB, 1C, 2C and 10A are grouped for debate.

Hon. Frank Oberle, for the Minister of State (Finance) moved:
Motion No. 1A.
That Bill C-19 be amended in the French version of Clause 128 by striking out line 33 on page 69 and substituting the following:
"fiducie ou de societe de personnes ou regie-".
Motion No. IB.
That Bill C-19 be amended in the English version of Clause 191 by striking out line 30 on page 98 and substituting the following:
"section."
Motion No. 1C.
That Bill C-19 be amended in the English version of Clause 200 by striking out line 14 on page 103 and substituting the following:
"composition of the board or an irregularity in".
Motion No. 2C.
That Bill C-19 be amended in English version of Clause 315 by striking out line 23 on page 164 and substituting the following:
"firm of accountants as auditor of a bank,".
Motion No. 10A.
That Bill C-19 be amended in the French version of clause 472
(a)	by striking out line 27 on page 275 and substituting the following:

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"ger ou a une entite controlee par celui-ci,";
(b)	by striking out line 38 on page 275 and substituting the
following:
"ment de la dette publique du mSme".


Donald Alex Blenkarn: Mr. Speaker, these are rather simple matters. They involve language. As we go through these bills you will find a number of amendments like these. These are amendments here to correct the English or the French to bring them into a consistent situation. I would move that these motions be carried without debate.


Catherine S. Callbeck: Mr. Speaker, I would agree with the hon. member for Mississauga South. I have gone through these amendments and they are very technical and are really there to help clarify the legislation.


John R. Rodriguez: We have no problems with them, Mr. Speaker.


Simon Leendert de Jong: Mr. Speaker, there are one or two I am not quite clear on and perhaps my colleague from Nickel Belt or perhaps the mover and the seconder of the motions who have introduced these motions in the House can explain some of the technical details here.


Donald Alex Blenkarn: There are really no technical details. It is very, very simple. The explanation is that sometimes when we translate from English to French or from French to English the realization of the translation does not work out exactly the same way. It is one of the problems and one of the benefits of the Official Languages Act. I assume that my friend is still supporting that act. If that is not his policy perhaps he would like to clarify.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Agreed.


The Acting Speaker (Mr. DeBlois):: I remind all members that the vote on Motion No. 1A will apply to the four other motions.


Some hon. members:: Agreed.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt Motion No. 1A?


Some hon. members:: Agreed.


The Acting Speaker (Mr. DeBlois):: I declare the motion carried.
I therefore declare Motions Nos. IB, 1C, 2C and 10A carried.
Motion No. 1A agreed to.


John R. Rodriguez: Motion No. 2.
That Bill C-19 be amended by adding immediately after line 32 at
page 110 the following new clause:
"215. (1) The directors of a bank shall place before the shareholders for approval, at every annual meeting, a list containing the names of the five directors, officers or employees of the bank who are to receive the highest salaries to be paid by the bank in the next financial year of the bank, together with the amount of such salaries.
(2)	Notwithstanding any Act of Parliament, the salaries referred to in subsection (1) may be paid only to the extent that they have been approved by ordinary resolution.
(3)	Forthwith after each annual meeting of shareholder's, the bank shall send to the Superintendent, a list containing the names of the five directors, officers or employees of the bank who are to receive the highest salaries to be paid by the bank in the ensuing financial year of the bank together with the amount of such salaries.
(4)	For the purposes of this section, "salary" means any form of remuneration payable by a bank for work performed by a director, officer or employee of the bank and includes
(a)	commissions, vacation pay and bonuses;
(b)	reasonable value for rent and housing;
(c)	payments in kind; and
(d)	any other advantage received directly or indirectly from the bank;
but does not include
(e)	any amount paid as a consequence of the termination of the employment of any director, officer or employee."
He said: Mr. Speaker, do you remember yesterday when we were dealing with Bill C-4, the trust companies act, that we moved the exact same amendment?
The purpose of the amendment is to require disclosure and shareholder approval of the remuneration of the five highest paid directors, officers or employees of a bank. As I said yesterday, this is simply an extension of the democracy that we support in the political operations of
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our country. In a way, a bank or a company is much like a country.
In a country the electors, the people of the country are really the shareholders. The assets of those shareholders are managed by the people whom they elect. That is government and that is Parliament.
All the people who are shareholders in this democracy of Canada know or have available to them what are the wages of their directors, their chief officers, the cabinet and members of Parliament. Their wages are available to the public because the public who are the shareholders are paying the loan. They are paying the freight.
They have a right to know. They have a right to know in the same way in a bank the shareholders and potential investors have a right to know. After a while, that money is coming out of potential dividends and it is going to pay the salaries of the top officers.
Can you imagine the scene now where the shareholders can vote the wages of the board of directors of the company, which is really peanuts compared to what the chief operating officials of the bank get? Yet the shareholders are not asked to vote and to approve the wages of the top officials of the bank. I think there is a need for that kind of transparency because there is what is called accountability. Where there is transparency, there is accountability.
This is not just simply some sort of titillating desire to be pornographic about the earnings of bankers. That is not what it is all about. In fact, in the United States this information is all filed with their securities commission.
What we are asking here is not something radical. In fact, we have had the experience. Imagine that when we wanted to find out what the chief officials of corporations earn, we have to actually go to the United States and access the information there.
We used to collect this under the old Corporations and Labour Unions Returns Act. CALURA we called it. Do you remember CALURA? When this government came into office, it scrapped that.
There was an opportunity at one time under CALURA when we could go and look up this information. We cannot do that now. We have to go south of the border. We have to depend on the American process getting information for us. That does not seem to me to be fair ball.
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In fact, the Ontario Security Commission is seized of this matter at the moment as we speak. They are attempting to decide whether they should require this information to be filed.
We are asking the government to recognize that it has a leadership role here and it has control over banks and financial institutions because of Bill C-19 and the Bank Act. We should be leading the way. We should be providing the opportunity for the shareholders and the potential investors of banks to get this information, information which they, on their own, are not able to obtain even from their own institutions of which they have a share. I appeal to the members in the House. I appeal to my colleague from Mississauga South who, from time to time, displays a sense of fair play. I know he is always concerned about the interests of the shareholders. Here is an opportunity to put something into the bill.
Good heavens, it is not radical, it is not something that is not done by our major trading partner. To hear the bankers tell it and to hear the government tell it, that is supposedly one of the spin-offs from the free trade agreement. After all, we are allowing American banks to come in here under the agreement and we treat them as if they are Canadians.
It has been shown by no less a person than Doug Peters that in fact we do not have the same reciprocal access to the American markets in banking and financial institutions as they have here. If it were working the way the government envisaged it working and the way I see all the Canadian banks running down into the United States, why would they? If they are going into the United States as they are, they are going to have to comply with American rules and they will have to reveal the information down there. So what is this nonsense that we cannot lead. It is not a question of leading, it is a question of what is logical. We are into a free trade agreement where you have a level playing field.
It seems to me to be logical that the government would want to put in its bank legislation the same kind of rules that apply to bankers in our chief trading partner. I do not see a problem with this. I really do not.
Look at the things that we are interested in having put on the record.

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Mr. Speaker, I want to tell you that one of the things that shareholders ought to be very concerned about, one of the hidden things that they ought know, is about the golden parachutes that the top echelons of a corporation, in this case banks, arrange when it is time for them to bail out. I think it is very important for the shareholders to know that, especially since we are going to be moving into a period of merger frenzy. In merger frenzy, it is important for the shareholders and the potential investors of that company to know who has got what golden parachute or what platinum parachute has been designed so that the top echelons of a corporation can jump out of the plane in mid-flight and float comfortably to earth and find a little patch somewhere. That is very important.
They need to know what are the bonuses they get paid. If this information about bonuses were available, by God, the bonuses that were paid in the Standard Trust scam, those bonuses were out there on the table, then in fact it makes OSFIs job much easier with respect to knowing what the bonuses are and how they are paid.
That is veiy important. So I say to members and I say to my colleagues on my right in particular, the Liberal Party, do not get sucked in by the Tories. Put last weekend behind you. Stand up for the shareholders and the potential investors of this country. Show that you are different from them. You do not have to go along with them on this one.


Donald Alex Blenkarn: Mr. Speaker, I understand the inquisitiveness of my friend with respect to salaries. As he has mentioned, the Government of Ontario is a New Democratic Party government and it is in charge of security trading in Toronto on the Toronto Stock Exchange.
It may be that as a result of security hearings in Ontario companies that are listed on the TSE will be required to disclose certain salary levels as suggested in this amendment. However, that would be all companies. What he is attempting to do in this amendment is concentrate on banks only and say that bankers have to disclose and under the current law no one else would have to. That, I submit, would be improper.
Second, the hon. member must understand that we are dealing in a highly confidential system of management of people's money. Banks operate on a leverage of somewhere between 20:1 and 25:1. Their activities are highly supervised by the Superintendent of Financial Institutions and by the specific requirement on auditors to report on very extensive requirements on behalf of directors to make sure that the operation is conducted in a solid fashion.
All of the information that he would like to see public is already in the hands of the superintendent and that is where it belongs. We have to make sure that the confidence that is required in the marketplace for our banks, our trust companies, insurance companies and so on, is there.
If it becomes a question of security legislation that might apply across the board to all corporations, then that would be a matter for security legislators. However, this is not a security legislation bill. This does not affect all companies. This affects banks, and this bill deals with the management and the protection and the solvency of banks. That is the reason why we ought not to confuse our objectives.
If the objective is to be inquisitive as to what bankers earn, then the Ontario government is quite capable on publicly listed stocks to demand certain disclosures as part of the stock exchange information. However, this is not a stock exchange. This is the security of banks and it is the view of the government that this information ought not to be public information, though it ought to be, and obviously is, readily available to the superintendent in every aspect as he conducts his investigations into the solvency of the institutions.


Catherine S. Callbeck: Mr. Speaker, I rise to speak on Motion No. 2 concerning wage disclosure, which is a similar motion to the one I spoke on yesterday with respect to trust companies.
Yesterday I reported that this legislation in the United States, which is what this amendment is based on, actually drove up executive salaries. I want to quote Senator Claude Castonguay. This is taken from The Globe and Mail October 10, 1991, where he said: "The United States, with its individual disclosure, has higher executive compensation than many other countries. As far as we know, the gap between executive compensation and that of other employees is much greater in the United States than in other countries. Compensation experts agree that is the case."
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Mr. Speaker, that is the point I was making yesterday.
We heard this morning that you have to go to the United States to get the salaries of top Canadian executives for companies that are listed on the stock exchange. You cannot get those individuals' salaries. What you can get is the total salary figure for the top five executives.
I think if wage disclosure of the top executives is going to be legislated so that shareholders can get that information, it is only fair that we should look across the board at other huge corporations in this country. The salaries at other corporations should also be made available to the shareholders. It is unfair to single out the salaries of executives of financial institutions for disclosure and I will be voting against this amendment.


Simon Leendert de Jong: Mr. Speaker, I just do not understand the reasoning that we have heard from both the government member and the member of the Official Opposition.
First of all, the member from the Official Opposition says it is unfair to put special emphasis on officers of financial institutions. Then the member from Mississauga South said that the financial institutions are so important, these are deposit-taking institutions, they deal with other people's money, and therefore they require great secrecy. The more we allow them the secrecy, the better it is going to be for everybody. I find that a bit of twisted logic.
Personally I think the more transparent, the more open information is, the better management and the better trust depositors can have in those institutions. It is the secrecy, it is the possibility of the sweet contracts, it is the possibility, especially now with the so-called reforms of financial institutions, that allow these deposit-taking institutions to get into commercial ventures and insurance and so forth that make it even more important that we have public disclosure. We are hearing the members of the Liberal Party and the Conservative Party say on the one hand: "Look, why take on the financial institutions. If you are going to have disclosure, you should have disclosure all over", and then in the next breath they say: "Ah, but these are special institutions and they require special consideration". It does not make sense.
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What members of the Liberal and Conservative Parties are doing here is justifying an old archaic measure that we have in this country. As I understand it other industrialized countries do not give this type of exemption to officers of publicly held corporations. It is archaic- as our Senate is archaic and we have a few other archaic institutions in this country-for us not to have the same type of requirements.
Let us remember first and foremost what we are talking about is widely held publicly traded corporations, but they are financial institutions. In a democratic society, the shareholders, the owners of those institutions, the voters so to speak, should have certain rights. Surely one of the fundamental rights is the right to know what the chief executive officers are being paid.
Imagine in a democracy if our salaries were kept secret or the salaries of cabinet ministers were kept secret. That is not acceptable. Of course it is not acceptable. The voters, the taxpayers, the shareholders so to speak in Canada, have a fundamental right to know this. Why is it not the case as well when we deal with publicly traded corporations? Their shareholders, their voters so to speak, should have the right to know what the executive salaries are. We hear these twisted illogical reasons why we and the shareholders should not know. Some suggest that it will encourage higher salaries. Others suggest that perhaps if people know how much they were really earning, there would be a greater temptation to kidnap them. All right, they may have some point. I do not think it is really going to stop or encourage a kidnapper either way.
I have not heard the spokesperson from either the Liberal Party or the Conservative Party refute some of the arguments that have been brought forward. Why is it not the right of the public, that is the shareholder, to know this information.
As I said earlier, as we go through financial reform, as deposit taking institutions are now going to be involved in other commercial ventures as well as other financial ventures, the importance of public disclosure becomes even more important.
I would also like to make the argument particularly for small financial institutions that the amount of remuneration given to the chief executive officers can have a direct effect on the amount of dividends being paid to the shareholders. Surely the shareholder should know how much of the expenses go to the salaries of the chief

November 26, 1991
Government Orders
executive officers. The amount of the dividends are going to be affected.
Surely the shareholders have a right to know that they are not being gouged, that there is not some sweetheart agreement among the directors and the chief executive officers to line their pockets at the expense of the shareholders. If this is the case, the shareholders should know about it and be able to do something about it at the next shareholders meeting.
Again, especially in terms of smaller financial institutions, it is really important that the shareholders have the right to know what the salaries and the various forms of remuneration will be.
It pains me to begin to understand the logic and the reasoning of both the Liberal Party and the government.
I served with my friend and former chairman of the finance committee, the hon. member for Mississauga South, on the finance committee. I sat with him as we investigated bank service charges and so forth and I know the hon. member's true feelings on these matters and that is the more public disclosure there is, the better. The system just works better if we have more public disclosure.
Unfortunately, he is now caught in the position where he is the chief spokesperson for the government. The minister cannot be in the House to explain and justify the legislation, so now my friend has become, in a sense, a cabinet minister. I do not think he is going to get the salary of a cabinet minister.
It is unfortunate I think, because the House will miss him, that he will not be running for re-election. That is a pity. In some ways I look forward to hearing what he would have to say when that group returns to this side of the House.
I think we would begin to hear what the hon. member really feels on motions like the amendment that is being introduced by my friend from Nickel Belt. If the member for Mississauga South had been sitting on this side of the House, he would be lining up here with us. I think we would have had a race between the member for Nickel Belt and the member for Mississauga South to the Speaker's chair as to who was first going to introduce amendments like the one that we are debating right now.
I feel that the hon. member for Mississauga South truly believes that the more disclosure there is the better the system operates. I think had he been on this side of the House, we would have heard some very eloquent arguments in favour of this amendment.


Mr. Stan J. Hovdebo (Saskatoon-Humboldt):: Mr. Speaker, far be it from me to rise in defence of banks and so on, but I do want to rise in this particular case because banks are publicly-held institutions. They are very important, probably more important than any other institution to the community in which I live. The fact that they are ending up with a good portion of the land in my part of the world is beside the point.
I think it is very important that those farmers who are being foreclosed on should know where some of their money is going. This amendment is about transparency. It is about the confidence of the public in the financial institutions with which they are dealing, a confidence which they do not have at present. They do not have confidence at present because they do not know where the money is going.
The other day I dealt with a farmer who showed me that over the last 10 years he had a $300,000 debt on which he had paid $700,000, and then he lost his land. Where did that money go? Did it go to the bank manager? Did it go to the top people in the corporation? There is a definition in this particular amendment as well as what is compensation. A lot of the public would like to know exactly what compensation is. What is considered compensation? Is it commissions or vacation pay? Is it homes, apartments, buildings or bonuses? Is it payment of any kind which should not have been taken out of the total-


The Acting Speaker (Mr. DeBIois):: Order, please. It being one o'clock, I do now leave the chair until two o'clock this afternoon.
The House took recess at 1. p.m.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
November 26, 1991

Mr. Joseph Volpe (Eglinton-Lawrence):: Mr. Speaker, can this government do anything right? In its announcement to provide an $800 million pay-out to farmers last Thursday, the government was stealing from Peter to pay Paul just a little.
First, the amount translates into only about 25 per cent of what Saskatchewan farmers actually need.
Second, the revenues will be raised by forcing corporations appealing tax impositions to pay 50 per cent of the appeal amount before the appeals are completed. This will not only increase the cash flow problems, but it will also contravene some basic principles proposed by a Tory task force on Revenue Canada chaired by the hon. Minister of Communications in 1984.
That task force stated, and I quote: "Taxpayers must be considered innocent until proven guilty" and "it is objectionable in principle that taxpayers should be penalized before they receive a fair hearing".
We agree. Let the Minister of Finance solve the problems of our agricultural community. Let him do it expeditiously, but let him do it also without compromising fundamental legal principles and without further weakening an already beleaguered sector of the economy.


SENATOR CLAUDE CASTONGUAY
Mr. Garth Turner (Halton-Peel):: Mr. Speaker, I would like to say a few words about Claude Castonguay. Yesterday, we heard that Mr. Castonguay, on the advice of his doctor, had withdrawn from the joint committee on the federal government's constitutional proposals.
That is too bad because this gentleman is greatly respected in Quebec and in the rest of Canada. He has shared his experience with Parliament and given his support to our country. At a time when we need reason, patience and patriotism, we also need people like Claude Castonguay.
I hope he will continue to assist us in the constitutional debate, as an adviser to the government, in the months to come.
Mr. Castonguay, thank you for the work you have done for Canada. You have given us even more reason to fight for this great country of ours.


AGRICULTURE
Mr. Les Benjamin (Regina-Lumsden):: Mr. Speaker, some farmers thought they would get a better deal when the Conservatives formed the government in 1984. Boy, did they get a wrong number. Instead of a better deal they got the free trade deal, sky high interest rates, attacks on orderly marketing systems for grain and dirty thirties grain prices.
By the end of last year the total prairie farm debt was $13.6 billion, $5.3 billion in Saskatchewan.
In my province two farm families a day are forced off the farm. This year another 253 farm families have gone bankrupt. By the fall of 1990, over 90,000 people were forced to rely on food banks in the prairies, and we have eight of them in rural Saskatchewan.
Just before the recent election they found $800 million for prairie farmers but it is too little and, by the time they get it, it will be too late.
In Saskatchewan, farmers' net income will decline 53 per cent this year. Farmers need $1.3 billion immediately. The government must act now to assure the very survival of thousands of farmers and of the prairie farm economy itself.


YUGOSLAVIA
Mr. Stan Wilbee (Delta):: Mr. Speaker, the tragic state of civil violence in Yugoslavia is of grave concern to us all.
The people of Croatia have been devastated. The mass destruction of invaluable historic landmarks and of whole cities such as Dubrovnik is deplorable. However, the real tragedy is the day-to-day loss of human life. The people of Croatia live every moment in fear of another attack from the Yugoslav army. This is unacceptable.

November 26, 1991
Along with this government, I am opposed to the modification of any Yugoslav boundaries by the use of force. In addition, the forced evacuation of civilians that has occurred must stop. This is unacceptable.
I would encourage this government to do all that it can to ensure that international bodies such as the UN, the CSCE and the European community work diligently together to end the violence now.


SENATOR CLAUDE CASTONGUAY
Mr. Nic Leblanc (Longueuil):: Mr. Speaker, Mr. Cas-tonguay's resignation yesterday is a typical example of a great Quebecer who once again "made the effort". He wanted to meet the challenge and tackle the Canadian Constitution, but his attempts were foiled by the system. I wonder when people will finally realize that our federalist system does not work and cannot be changed. The division between Quebec and the rest of Canada is too great. So much energy, resources and people have been wasted in this process. I would ask my Conservative colleagues from Quebec to think about this. The present system is a cruel one. It is not worth sacrificing oneself for the lost cause.


QUEBEC CITADEL
Guy St-Julien: Mr. Speaker, today in Le Soleil, we read that renovations at a total cost of $403,000 will soon begin on the wing reserved for the staff of the Quebec Citadel. In fact, three additional rooms and an ironing room will be built, as well as four new offices and a refrigerated storage space for waste.
I think this amount of work on a building used as a residence by the Governor General of Canada for one week every year is unnecessary.


CARDIO PULMONARY RESUSCITATION
Mr. Eugene Bellemare (Carleton - Gloucester):: Mr. Speaker, November is CPR Awareness Month.
The Heart and Stroke Foundation of Canada is launching this new annual event to promote heart
healthy living and to encourage Canadians to become trained in the administration of cardio pulmonary resuscitation.

Every year, about 45,000 Canadians die of a heart attack. Heart disease and strokes are the main cause of death in Canada, taking nearly 80,000 lives each year. Individuals who take advantage of training in cardio pulmonary ressuscitation are able to recognize the symptoms of a heart attack, and they acquire the ability and skill to act in an emergency. As more people are trained in CPR, more lives can be saved.

Last June I sponsored with the encouragement of the Speaker a successful CPR information session for MPs, senators, staff and House of Commons personnel. Once again I am asking my colleagues to raise the awareness of CPR.


GLOBAL VISION
Mr. Terry Clifford (London-Middlesex):: Mr. Speaker, the Canadian economy is undergoing a fundamental transformation. This fact is making it more important than ever for Canadians to learn and know about international trade and competitiveness.
Global Vision: Our Competitive Advantage program, is a unique initiative designed to provide Canadian youth from every region of our country with the knowledge and understanding necessary to compete in the international marketplace. In effect, the Global Vision Program is producing a trade corps of young Canadians.
Global Vision participants, including Ms. Min Kim from your riding, Mr. Speaker, are viewing the proceedings in the House today and later will be with the special advisor to the OECD.
Congratulations to these Global Vision participants and special congratulations to the sponsors: Canadian Airlines, CIBC, London Life, Labatt's, Matthews Group, Bombardier, Noranda, Power Corporation, American Express, Aerospatiale, Japan Camera and Canadian Shipbuilding and Engineering.
The trade corps of young Canadians is on the move. Get ready Canada to catch the vision.
November 26, 1991


CROATIA
Mr. Lawrence MacAulay (Cardigan):: Mr. Speaker, all Canadians are horrified at the news we are receiving from Croatia. For months now we have witnessed endless fighting between Croatian militia men and the Yugoslav federal army, a fight between self-determination and oppression.
In a nation divided by centuries of racial mistrust and hatred people are suffering. Ever since the federal army offensive began months ago innocent people have been dying. Every attempt to negotiate a cease-fire has failed and the intervention by the European community has not produced results.
As Canadians we should do everything we can to lessen the suffering on the innocent people. Hunger and death know no race or nationality. I call on the Canadian government to use every available means to end the death and destruction and to restore peace and harmony to this troubled part of the world.


LE MANOIR SULLY
Mr. Marcel R. Tremblay (Quebec-Est):: Mr. Speaker, November 8 was a happy day for about a hundred retired people in my riding because their wish became reality. On that day, their new residence, Le Manoir Sully, was officially opened.
This outstanding residence, with a style and beauty all its own, was built privately by Raoul Emond and will be managed by him and his wife Louise. His concern for environmental protection and his desire to pamper our seniors in this unmatched atmosphere ensure the success of his project and make it a model for those who want the later years of life to be most enjoyable.


ICEBREAKERS
Miss Deborah Grey (Beaver River):: Mr. Speaker, I rise today to congratulate the innovative designers of the icebreaker Oden. This Swedish flagged ship designed in Alberta is the first non-Soviet icebreaker, as well as the
first non-nuclear vessel of any nationality to reach the North Pole.
This is a monumental achievement for Canada, but unfortunately it has gone virtually unnoticed by the federal government.
Since 1969, when the U.S. ice strengthened oil tanker Manhattan ploughed through the northwest archipelago, Canada has been looking for a new polar icebreaker capable of patrolling all Arctic waterways and protecting Canadian sovereignty. Such an icebreaker could contribute significantly to oil exploration development in the north.
The development of such an icebreaker has proved fruitless, as in the Polar 8 project, a $650 million venture which was eventually scrapped. By way of contrast, the total design and building costs of Oden came in at a mere $55 million.
Why is this government not pursuing an evaluation of the Oden design icebreaker? Instead, the Canadian Coast Guard is attempting to modernize the 21-year old Louis St. Laurent to the tune of $140 million. That is enough to build at least two Oden vessels in a foreign yard or one Oden class craft in Canada with tens of millions of dollars in change.
When is this government going to get serious about containing costs and protecting Canadian sovereignty?


THE LATE GUY DESCARY
Hon. Bob Layton (Lachine-Lac-Saint-Louis):: Mr. Speaker, I wish to share a few thoughts about Mayor Guy Descary.
Guy Descary was very devoted to his city, the fair city of Lachine. Since I was elected member of Parliament for Lachine-Lac-Saint-Louis in 1984, I had several opportunities to participate in events with the mayor. On every occasion, I was always impressed by his generosity, his ability, his aspirations, his appreciation of our heritage and his understanding of his citizens' needs.
Guy Descary initiated the waterfront redevelopment project and helped to create wonderful parks and develop culture, all of which make Lachine a good place to live for all its residents.

November 26, 1991
What else can one say, but "Thank you very much, Guy Descaiy."


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, last week New Democrats started a tour across Ontario to speak out against the government's plans for free trade with Mexico.
One steelworker in Hamilton said: "This agreement will probably hurt us more, hurt our jobs, hurt us socially, than the deal with the United States". Yet today Canadian cabinet ministers are in Mexico. They have done nothing to show Canadians that such a deal will not lose as many jobs. They have done nothing to prove that the Mexican human rights record deserves special trade benefits from Canada. Yet the Conservatives supported by the Liberals go forging ahead.
We in the New Democratic Party say that it is time to stop. It is time to put people and Canada first rather than profits for companies that want to produce with low Mexican wages.


SMOKED HERRING INDUSTRY
Hon. Jean Chretien (Beausejour):: Mr. Speaker, I wish to draw the attention of the House to the current crisis in the smoked herring industry in Cap Pele, New Brunswick.
The industry has come to a standstill, now that Haiti, its biggest market, has practically closed its doors to this trade. Plants will have to close and workers will be laid off. In Beausejour, these lay-offs will hurt.
There is a temporary solution, but that depends on the Minister of Fisheries. The minister could use the Fisheries Prices Support Board to help the plants through this crisis.

I urge the government to act now through the Fisheries Prices Support Board and save the jobs in the herring industry in southeast New Brunswick.


QUALITY MANAGEMENT
Mr. Ross Stevenson (Durham):: Mr. Speaker, it is well recognized that we have been losing the competitive edge for world markets. There are no quick fix solutions, but total quality management is becoming the criterion for progressive competitive companies on this continent.
It involves the employees and management working harmoniously in complete dedication to producing the highest quality goods and services by knowing and even exceeding customers' expectations.
As a national initiative total quality management will ensure lasting global competitiveness regardless of external considerations such as wage levels, interest, exchange rates or environmental costs. With Canada once again recognized world-wide for the quality of its goods and calibre of its people we will all enjoy a better quality of life.
I urge the federal government to encourage total quality management programs throughout Canada.


EAST TIMOR
Mrs. Beryl Gaffney (Nepean):: Mr. Speaker, this morning the BBC reported that the Government of Australia is reconsidering its formal recognition of Indonesia's sovereignty over East Timor in response to the recent massacre of close to 200 unarmed Timorese.
Canada has in recent years recognized Indonesia's rule in fact. This runs against the grain of international efforts to shed light on the horrendous human rights violations in East Timor. The International Red Cross has been denied access. Human rights workers are steering clear of the area as there are allegations that they are forcing the disappearance of witnesses to the massacre.
Will the government take immediate action to suspend Canadian aid to Indonesia until the review of Canadian aid and commercial activities in Indonesia is completed and will it press the UN Security Council for full implementation of Security Council resolutions 389 and 384? These are very strongly worded resolutions which direct Indonesia to withdraw its troops completely and
November 26, 1991

calls upon the international community to provide immediate assistance to the people of East Timor.



ORAL QUESTION PERIOD


Joseph Jacques Jean Chrétien: Mr. Speaker, first of all, I would like to welcome back the Prime Minister from the Sommet de la Francophonie, in France, where he showed Canada and the world that there are French speaking Canadians across this country and that we all have an interest in the advancement of French language and culture, not only in Canada but throughout the world.

Now that we are back to local business my question is to the Prime Minister. Today more than 100 farmers and political leaders from western Canada are in Ottawa. They are here because the situation of our prairie farmers is desperate. All this government seems to be able to do at this time is stall for time.
Massive European and American subsidies are killing Canadian agriculture. Discussions at the GATT are going nowhere. I would like to make a suggestion to the Prime Minister.
Will the government convene an international summit on the grain price war with the Americans, the Europeans and the other producers outside GATT because we are going nowhere at this time within GATT?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, we are dealing with this very important problem on an ongoing basis. As a member of the Cairns group Canada was the country that put the question of the trade distorting agricultural subsidies on the G-7 table in Tokyo in 1986. We have fought the issue through the GAIT now for some years.
We are getting to the crunch momentarily. In Paris last week I had a lengthy working meeting with Jacques Delors, president of the community on precisely this
Oral Questions
point. We hope we will be able to persuade both the Europeans and the Americans to cease their suicidal subsidies that have the effect of not only distorting trade but driving Canadian producers out of business unfairly.
This is the exact type of reform that we are seeking through the GATT and through our ongoing international negotiations.


Joseph Jacques Jean Chrétien: Mr. Speaker, in the absence of the Minister of Agriculture I would like to ask the Prime Minister: While this government drags its feet on the money it has decided to give the farmers, Farm Credit Corporation is running around the prairies foreclosing on farmers. Families are being driven from the land they love.
If the government will not agree to give farmers the money they need right now, will the government instruct the Farm Credit Corporation not to foreclose on farmers who have to wait until next year to receive the money that this government has promised to them?


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance):: Mr. Speaker, a similar question was raised yesterday. If the hon. Leader of the Opposition has any examples of unjustifiable actions taken by the Farm Credit Corporation, I know that I would be interested in it and so would the Minister of Agriculture.
I think the hon. Leader of the Opposition would agree that the best way to solve the farm problem is to solve the trade problem. That is the number one initiative. That is the most important initiative that we are taking. The Prime Minister has provided leadership in the international forum in respect of that issue.
Back here we are supporting the agricultural industry and particularly the grains and oilseeds sector in an unprecedented fashion. If we compare the direct support that has been provided in the last five or six years as compared to the previous five years from 1981 to 1984, we will see that there is almost a sixfold increase in direct support.
As a matter of fact, as I indicated to the coalition of farmers that I met today, I reminded them that some $2.9 billion will be paid out in support of the grains and oilseeds sector and the agricultural sector between now and spring seeding. That is a substantial amount of money.

November 26, 1991
Oral Questions
I realize that money has not flowed to the farmers yet but it is on the way.
| Translation]


Joseph Jacques Jean Chrétien: Mr. Speaker, I would like to repeat my question to the Minister of Finance. The agricultural industry, not only in Western Canada but across the country, is up against a very difficult situation. During the past few months, government ministers gave Ontario and Quebec farmers the assurance that Canadian producer boards were not threatened by GATT.
And now, all of a sudden, we read in the papers this morning that the Minister for International Trade and the Minister of Agriculture, who were in Mexico, were dispatched on short notice by the government to Geneva to discuss the matter of producer boards. Could the government tell Canadian farmers whether in addition to the problems facing western farmers, we are about to lose our producer boards at the current talks in Geneva?


Hon. Pierre Blais (Minister of Consumer and Corporate Affairs and Minister of State (Agriculture)):: Mr. Speaker, I imagine that when he says "producer boards", the hon. member is referring to our agricultural marketing boards. The Canadian position, which is shared by all Canadian farmers, is that we not only support keeping article XI but we are also seeking clarification and reinforcement of that article. The Canadian position, which affects farmers across the country, is something we built together.
As the Leader of the Opposition just mentioned, the Minister for International Trade and the Minister of Agriculture are now in Geneva, with Canadian representatives of the agricultural industry, and they have been asked to continue to pressure both the Director General of GATT, Mr. Dunkel, and other delegations to maintain and reinforce article XI. That is the Canadian position, and we do not intend to change it.


Mr. John Harvard (Winnipeg St. James):: Mr. Speaker, my question is for the Deputy Prime Minister who says that his government is doing its best for farmers.
The fact is that the best of this government this year is not as good as what it did last year. Figures from
Statistics Canada tell the story. In the first nine months of this year direct payments to farmers fell $700 million. That is 45 per cent.
The question is: Why has it chopped assistance to farmers when they need it most?


Hon. Charles Mayer (Minister of Western Economic Diversification and Minister of State (Grains and Oilseeds)):: Mr. Speaker, we have not chopped assistance to farmers when they needed it most.


Some hon. members:: Oh, oh.


Charles James Mayer: They laugh. We just announced $800 million a year ago. Do you want to laugh at that?
I was in the Soviet Union a month ago and the government provided $500 million of assistance to farmers that will let us sell 4 million tonnes of grain on behalf of western farmers.
We are in the process of putting out money under both NISA and GRIP, as the Deputy Prime Minister said, that is going to result in almost $3 billion being in the hands of farmers by next June. That is not an insignificant amount of money. I suggest it is an increase in the amount of money, if we include some of the other things we are doing like picking up the deficit in the wheat pool accounts and also looking at writing off the deficit in western grain stabilization.
That is a very large amount of money that represents an increase by this government at a time when farmers need it most.


John Harvard: Mr. Speaker, allow me to try the Deputy Prime Minister again.
The future of many farmers is not measured in months or years. It is often measured in days or weeks. In Saskatchewan two farm families leave the soil every day. Yet this government is telling farmers that many of them will have to wait until spring for their emergency help. For many farmers that will be too late.
My question for the Deputy Prime Minister is: Why does the government refuse to make its payments this year? Why do farmers have to wait until spring?


Charles James Mayer: Mr. Speaker, the member does a disservice by using that kind of explanation. That is not the case.
November 26, 1991

We are presently printing forms that are going to distribute $400 million of the $800 million, and some of that money will go out before Christmas. We are presently distributing money under NISA. That program is just up and running and farmers are now, just as a result of the provincial governments sending out confirmations under GRIP, are getting money under GRIP as well.
In addition, with the extra grain sale of 4 million tonnes, a record amount of grain is going to move between now and the end of March. When we put all those things together, farmers are not going to have to wait very long to get the assistance they deserve from this government.


Mr. Vic Althouse (Mackenzie):: Mr. Speaker, my question is for the same minister. He knows that farmers are not easily riled, they are generally a fairly long suffering group and very knowledgeable about what the government is doing.
In spite of all that, the minister surely knows about the large rallies and the delegation that has come out of those rallies here today, indicating that the farmers' analysis is that the government has not properly looked after their interests, has not guaranteed their net income and that the third line payment was not adequate, leaving Saskatchewan farm families, for example, with net incomes that will be less than $6,500 per family or a third of the poverty level in this country.
Is the government going to provide a proper third line of defence payment and address the needs the farmers are presenting?


Charles James Mayer: Mr. Speaker, there is absolutely no question that these are very disconcerting and in some cases desperate times, on behalf of Canadian grain and oilseeds producers.
I had a chance to attend four of those meetings on the prairies. I should also point out that this is not only a problem for the prairies. It is a problem for Ontario and other parts of the country that produce grain as well. It might be good for all of us to know that on average Ontario produces more grain than the province of Manitoba. Therefore it is very much a problem outside the prairies and we are doing our very best to address it.
Oral Questions
No matter how much money we put out, it is not the real solution to the problem. The solution to the problem is some sanity in international trade. I disagree with the Leader of the Opposition when he says that GATT is going nowhere. Fortunately, I think he is wrong because for the first time in over five years of GATT meetings we have had genuine discussions as to how we can deal with agricultural subsidies. That is providing a hope for a settlement.
Second, the member should know, and he probably does know this as a farmer, that in the last little while we have seen an increase in grain prices. In fact, yesterday we raised the initial payment for malting barley and we are going to be looking at what we can do with initial payments on wheat before Christmas.


Victor Fredrich (Vic) Althouse: Mr. Speaker, the Statistics Canada report that came out today states that not only have net farm incomes not been keeping up, but the farmers have had no choice except to offset the drop in incomes with increased debt.
How does he expect Canadian farmers to compete in a post-GATT world, for which we have been waiting five or six years now, when our debt levels are going up and virtually all of our competitor countries are seeing farm debt going down? What is he going to do to address the farm debt problem, since he has already indicated what little he has proposed to do on the income side?


Charles James Mayer: Mr. Speaker, the opposition keeps talking about what little we have done. The government this year is going to provide $3.8 billion in direct support. That is in addition to other programs that are ongoing. So while he may not think it is enough, at least he should give credit where credit is due: $3.8 billion is a lot of money.
It is a very difficult situation out there internationally. Countries like Canada, Australia and Argentina, where a large percentage of their earnings depend on exports, are in a very vulnerable position. That is why we have been pursuing the GATT negotiations with such vigour. Everybody, including the Prime Minister and the rest of us, at every occasion have been raising this.

Oral Questions
In addition to two of our ministers being in Geneva today to talk about article XI, they are also there talking about what we can do to reduce export subsidies, to finally get our farmers to be able to compete with other farmers in other parts of the world, as opposed to treasuries. We know in that kind of a competition we cannot win.


Mr. Rod Laporte (Moose Jaw-Lake Centre):: Mr. Speaker, one of the problems is the fact that this government has failed to bring in policies that are going to deal adequately with the agriculture needs of farm families in this country.
My question is for the Prime Minister. Statistics Canada announced today that in 1990 farm debt in Canada was at $24 billion, a dramatic rise over the year before. In Saskatchewan alone two farmers are forced off the farm every day.
Will the government call an immediate halt to farm foreclosures until the Minister of Agriculture does his job and introduces a farm finance package that has been promised since 1989 and that will deal with the farm debt and high interest rates that are cutting the heart out of rural Canada?


Charles James Mayer: Mr. Speaker, there is no question but that there is a need out there. I understand that there are people who are having a difficult time just meeting family expenses. That is what is so ironic and makes me so furious about this situation because it is something that our farmers did not deserve. They are good at what they do.
I would be more than happy to take his representation to the Minister of Agriculture, who has responsibility for the Farm Credit Corporation, to see what we can do to alleviate the situation.
If he is talking about moratoriums, I am not so sure that that is the right way to proceed. We went through that in this House six or seven years ago. I should point out that we have in place farm debt review boards, and the Farm Credit Corporation has a mandate to work with farm debt review boards as well as other financial institutions to deal with this situation.
Let me say again that I understand and the government also understands the serious problem that farmers are facing as far as farm closures are concerned. We are going to do the very best we can to deal with it.


Mrs. Christine Stewart (Northumberland):: Mr. Speaker, my question is for the Prime Minister.
Poverty and its associated stress is a dreadful reality for hundreds of thousands of Canadians today and a terrifying prospect for many more. Among those suffering most acutely are our nation's farmers.
The average net income of a Saskatchewan farmer this year is only $6,300-$6,300 after working his or her own farm seven days a week to feed each one of us. Continued poverty financing of our farmers will lead us all to the food banks, but food banks with no food.
Will the government redress its priorities today and assure farmers and all Canadians food security for tomorrow?


Charles James Mayer: Mr. Speaker, in one sense Canada is very much blessed with a relatively small population and an ability to produce food vastly superior to our needs. That is why we are so dependent on exports for farmers' incomes.
Let me speak as a farmer. The irony is that while we are good at what we do, it does not seem to count any more in the international marketplace where we earn our money.
We have been doing everything we can as a government to first, support reform internationally and second, to provide increasing amounts of support. This year we are spending $3.8 billion. That sounds like a big number but when it gets to the individual farmer we know that, in many cases, it is not enough. Third, we must do what we can to assist farmers to sell into a very difficult market. We have not backed away from supporting the Canadian Wheat Board and producers elsewhere they export their grain.
Through those three measures, if we can have a settlement at GATT, and I think there is some considerable optimism that we will get through this difficult period and our farmers again will earn the income they deserve.
November 26, 1991


CHILD CARE
Christine Susan Stewart: Mr. Speaker, my supplementary question is also for the Prime Minister.
Canada's economic health is important, but health is irrelevant if the patient, our society, is in extremis or dead. Poverty is killing our society. Over one million children, our nation's future, are being sacrificed on this government's altar of unfair economic policies.
Will the government reassess its bankrupt policies today, relieve the distress of our poor and immediately set family life, full employment and adequate housing as its first priorities?


Hon. Benoit Bouchard (Minister of National Health and Welfare):: Mr. Speaker, I do understand that the question could be addressed in terms of poverty for children. I believe I answered a similar question yesterday when I said that we already put $15 billion a year into the system for children, which is about one-tenth of all government spending.
I do not say again that it is too much, but I say that is the capacity we have.
At the same time, I agree that as long as we have children who are poor we have to do something and that is what we are trying to do. I am working out a strategy which I believe I can unveil sometime at the beginning of next year. It will help, but it will be done within the capacity we have to pay for it.


UNEMPLOYMENT INSURANCE
Mr. Alfonso Gagliano (Saint-Leonard):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration.
Unemployment Insurance offices have huge backlogs and the Pie IX office in the riding of Saint-Leonard is no exception. Since November 4, it has received over 1,850 new applications for employment insurance. Only 329 have been settled so far, due to lack of funds and staff.
Oral Questions
Does the minister have any explanation for the fact that it takes more than 12 weeks for someone to receive an unemploymnent insurance cheque, and will the minister do something about the backlog in all offices, not only in Saint-Leonard but across the country?


Hon. Bernard Valcourt (Minister of Employment and Immigration):: Mr. Speaker, it is rather difficult for me to comment at length on the situation at the office in Saint-Leonard. If I had received notice of the question, I would have been able to provide more details.
There were some delays this fall because of the problems we had with the Public Service, but departmental management tells me that steps are being taken every day to try to speed up payment of unemployment insurance benefits to recipients.


Alfonso Gagliano: Mr. Minister, I described the situation in my riding, but the problem exists across the country. If the minister does not know about it, I think the unemployed in our country will have some very serious problems before Christmas.
I have another case for the minister. Lvne Normandin, a woman who lives in my riding and who just had an operation, filed her unemployment insurance claim on time. She even added a second medical statement, as required by the officer. Now she has just heard that her file was lost and she has to submit another medical statement. This means she will have to spend money to get the statement, without having received any unemployment insurance benefits.
What is this lady expected to do during the next four weeks?


Bernard Valcourt: Mr. Speaker, under the Privacy Act I cannot comment on individual cases, but the hon. member has mentioned a case I would like to look into personally, because it is intolerable that someone in that situation should be made to suffer because of delivery problems.
I certainly would like to look into the particular case the hon. member just described.

November 26, 1991
Oral Questions


GRAIN EXPORTS
Mr. Rod Murphy (Churchill):: My question, Mr. Speaker, is for the Prime Minister. The farm delegation that is here today realizes the government cannot do everything, but there are some things that it can do.
Since the Prime Minister is aware that U.S. grain subsidized by the export enhancement program has resulted in American sales in Canadian markets in North Africa, the Mediterranean area, the Philippines and elsewhere, will the government agree to the request of the farm coalition and lead a Canadian lobby group to Washington in order to seek agreement that despite what the Europeans may do, that North Americans, who are still the dominant players in grain exports, will not drop prices in each other's traditional markets?


Charles James Mayer: Mr. Speaker, we do that on a regular basis, raise with the Americans the concerns we have over how they use their export enhancement program.
I should also point out to the member that if he is concerned about the Americans, and he should be and we all are-I can give him examples of what they have done in Algeria with Durum-he should be equally more concerned about the Europeans. The Europeans now are regularly subsidizing exports to the tune of almost $200 a tonne where the Americans do not subsidize everything. When they do their subsidies run as high as $60 and $70 a tonne.
We have been making our case with the Americans, and at the same time raising considerably more commotion with the Europeans over what I view to be the largest problem in international markets and that is export subsidies by the Europeans.


CHILD CARE
William Alexander (Bill) Blaikie: Mr. Speaker, my question is for the Prime Minister. Surely the Prime Minister is not going to sit out a Question Period which is trying to address a major crisis-


Some hon. members:: Oh, oh.


Mr. Speaker:: The hon. member will put his question but that is an improper imputation.


William Alexander (Bill) Blaikie: Mr. Speaker, my question is for the Prime Minister. The minister of health has said that the government only has so much money to spend on children. The fact of the matter is that 49 per cent of the people who are using the food banks which are springing up all over prairies and rural Canada are children.
I ask the Prime Minister: Is he going to make the commitment today to eradicate food banks on the prairies or does he want food banks to become monuments to his term in office?


Benoît Bouchard: Mr. Speaker, I think once again that the hon. member raises rather the issue of poverty itself, particularly in relation to children and food banks. Again, food banks are mechanisms of last resort and I think everybody agrees with that. However, in the present circumstances, I repeat what I said earlier: The government presently invests more than $15 billion in programs aimed directly at children both through tax measures and direct programs. I think Canadians as a whole should assume responsibility for the fight against poverty, especially through an improvement in the economic situation. I think that we all agree on that, but again, we must do it through the means at our disposal, particularly at the financial level.


REGIONAL DEVELOPMENT
Mr. Francis G. LeBlanc (Cape Breton Highlands - Canso):: Mr. Speaker, my question is for the Prime Minister. It concerns the deepening crisis in the Cape Breton economy.
November 26, 1991

Oral Questions
On the weekend thousands of Cape Bretoners marched in Sydney calling for jobs and dignity. Today Stora Forest Industries, one of the island's most important employers, laid off 30 employees, some of whom have been working there for up to five years. Come Christmas the whole mill, 1,000 workers, will be shut down because of the desperate state of the Canadian forest industry. Hundreds of fish plant workers will lose their jobs if fish quotas are cut again this year.
Will the Prime Minister recognize the gravity of this situation and convene a special meeting of his officials and local leaders to deal with this urgent situation?


Bernard Valcourt: Mr. Speaker, the hon. member points to Cape Breton and the difficulties that people are experiencing there. He will acknowledge I am sure that the Atlantic Canada Opportunities Agency, the Department of Fisheries and Oceans and other government agencies are trying to work with the people of Cape Breton to try to alleviate those problems.
We would like to be able to tell the hon. member that we can change this overnight. He knows it is impossible. In the meantime programs under employment and immigration are available for the people who have to adjust to the reality of the difficulty there.
I am ready and officials in the department are ready to continue working with the people of Cape Breton to try to improve their situation.
Mr. Francis G. LeBlanc (Cape Breton Highlands -
Canso): Mr. Speaker, my supplementary question is also for the Prime Minister.
The crisis in the Cape Breton economy is a direct result of his government's high tax, high dollar and high unemployment policies. His prosperity propaganda has been calling for partnership. Why will he not show some partnership with Cape Bretoners and direct his senior officials to work out with our local leaders an urgent program for economic recovery?


Bernard Valcourt: Mr. Speaker, the hon. member may try to make the people in Cape Breton believe that this all started with the economic policy that we are pursuing. However, even I and young Atlantic Canadians remember prior to 1984. Never has a government pursued an economic policy which translates right now into lower
inflation and into lower interest rates. Even in Cape Breton they will acknowledge that low interest rates is the best way of creating jobs.


FISHERIES
Hon. Roger C. Simmons (Burin-St. George's):: Mr. Speaker, my question is for the Secretary of State for External Affairs.
Foreign overfishing continues to decimate the fish stocks and wipe out jobs by the thousands in Atlantic Canada. In the last year alone she will know that the European community caught 98,000 tonnes on the Grand Banks, six times the allowable quota. This has been going on for seven years, the first four of which the government was absolutely silent on the problem and the last three of which the government has paid lip service to the issue.
Will she now admit that her colleague's rhetoric has not worked the magic that had been hoped for, and will she indicate what plan B is to get the Europeans off the backs of the fishermen down there?


Hon. Barbara McDougall (Secretary of State for External Affairs):: Mr. Speaker, neither my colleague nor myself indulge in empty rhetoric. We have worked extraordinarily hard. We have a special ambassador who is dealing with the fishery issue with the European community.
I spoke with the Portuguese foreign minister, the incoming president of the European community, at the NATO summit. We are going to stay in touch on this issue. He knows of our grave concern. He is personally sympathetic to our interests and we will continue to work very hard both directly and through our ambassador.


Roger Simmons: He is
showing his continued sympathy by allowing his fishermen to continue to rape the fish stocks out there. The Newfoundland premier, Mr. Wells, says that the time for diplomacy has all but run out and calls for some bolder action. He has called for an international police force to counteract the overfishing piracy.
Is it the intention of this government to pursue the idea of a police force, which I understand the fisheries minister favours? Is this minister prepared to pursue that idea with the other affected countries, or what is her

November 26, 1991
Oral Questions
idea? What bold action does she have in mind now that the talk has not worked?


Barbara Jean McDougall: First of all, Mr. Speaker, it is not fair to say that the talk has not worked. This is a long, arduous and difficult process. It is as frustrating for us as it is for anybody, because we are working very hard in the interests of our Newfoundland fishermen.
In my view the plan proposed by the premier of Newfoundland is not a realistic one, but we are prepared to work with our allies and other interested parties. We certainly agree with the thesis that there must be better control of the navigable waters and of all zones off the coast of Canada.


AGRICULTURE
Mr. Lyle Dean Mac William (Okanagan -Shuswap):: Mr. Speaker, my question is for the Prime Minister.
Canadian farmers fear that this government might abandon its system of protecting poultry, egg and dairy production as a result of the ongoing GATT negotiations. I emphasize that the very future of Canada's dairy and poultry industry essentially hangs in the balance.
My question for the Prime Minister is: What specific measures is the government prepared to take at this time to ensure that Canada's supply management structure remains intact? Can his government give Canada's agricultural community the assurance that tariffication will not be used as a fall back position in the ongoing GATT negotiations?


Pierre Blais: Mr. Speaker, as we mentioned many times, Canada has put in place its position on the GATT negotiations after full consultation with farm leaders across the country. Those farm leaders are with the Minister for International Trade and the Minister of Agriculture in Geneva today to work and to look at the situation.
As we know, the tariffication is not acceptable for a supply management system in Canada. We said that in the past and it is still our position.
We are following closely with our negotiators in Geneva. They are going to meet with Mr. Dunkel. We will stand by our position and I think farmers could count on us to maintain our position on that.


Mr. Lyle Dean MacWilliam (Okanagan -Shuswap):: Mr. Speaker, the Americans have been the main protagonists in the push to remove supply management in the current GATT negotiations. They have crippled our wheat industry and now they are after our marketing boards.
Does the minister recognize that once poultry and dairy are removed from commodity controlled protection, it is only a matter of time before those industries are gone? Is the minister prepared to get tough with the Americans and exercise Canada's option to cancel the free trade agreement should our agricultural industries be any further threatened?


Some hon. members:: Hear, hear.


Pierre Blais: Mr. Speaker, I do not really understand. As you know and as the hon. member should know, we have protected totally the supply management system during our negotiations with the United States. We still stand by that.


LOAN SHARKING
Garth Turner: Mr. Speaker, my question is for the same minister but in his capacity as consumer and corporate affairs minister. It concerns a disturbing development in the Toronto area.
Because banks have recently been reluctant to extend consumer credit in the form of personal loans, many people have turned to a new class of loan sharks. These financial entrepreneurs are charging hundreds of dollars up front to make an application for a bank loan. Of course most people find they pay the fee and get nothing.

November 26, 1991

Because there is no existing legislation to prevent this activity, will the minister agree to look into the situation and either act himself to prevent it from continuing or urge provincial governments to do the same?


Pierre Blais: Mr. Speaker, it is a very important issue.
As my hon. friend should know we do not have real jurisdiction on that. It is under provincial jurisdiction. Given that right now interest rates are around 8 per cent for a mortgage it is very good. That is the lowest interest rate over the last eight years.


Some hon. members:: Where, where, where?


Pierre Blais: It is everywhere in the papers today. I understand that it is a very important problem. I will ask my deputy minister to be involved with their counterparts at the provincial level to look at this important matter.


EXPORT MARKET DEVELOPMENT
Hon. Roy MacLaren (Etobicoke North):: Mr. Speaker, after only seven months the funds for the program for export market development have been spent for this year, and that at a time when Canada for the first time in 15 years has registered a trade deficit.
Is it the government's intention to transfer more funds into the program without further delay, or has it now decided simply to let it fall by the wayside?


Hon. William C. Winegard (Minister for Science):: Mr. Speaker, the government is very happy indeed that the PEMD has been so successful. We have had so many applications that we have indeed run out of money in that particular program.
What we are going to do is to seek further funding from existing budgets and transfer it to PEMD.


Roy MacLaren: Mr. Speaker, three years ago the government undertook a study evaluating all its export promotion activities. Was this current lack of funding for PEMD not foreseen? When will the government table its report on its export promotion activities, or is this yet another example of the government delaying action behind the facade of more and more consultations?


William C. Winegard: Mr. Speaker, I would think it is exactly the opposite. In fact it
Oral Questions
is a good illustration of how successful we are becoming in terms of promoting exports in the prosperity agenda. We have had many applications, far more than ever before, for the PEMD operation. That is exactly what I assume this House wants.


Mr. Paul Martin (LaSalle-Emard):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. The last budget and the estimates clearly set out the government's energy priorities. In its budgetary choices, the government allots sixteen times more money to polluting energies than to clean energies. The green plan tells us that environmental studies should have been done a long time ago on all government policies, including energy policies. My question is this. When will the Minister of Energy, Mines and Resources do his homework as promised?


Hon. Jake Epp (Minister of Energy, Mines and Resources):: Mr. Speaker, I say to the hon. member that I think his characterization of clean energy and alternate energy is not accurate.
For instance, does he want the minister of energy to abandon the oil industry in Canada? Does he want the minister of energy to abandon the gas industry in Canada? Does he want the energy minister of Canada to abandon coal? Does he want the energy minister to abandon hydraulic power?
I say to the hon. member that there has to be a balance. That is why we brought in an alternate energy program. I announced another aspect of it in Winnipeg last week. We got good publicity on it even during the time of a great Grey Cup in Winnipeg.
Therefore I say to the hon. member that he should do his homework and he will see that we have been doing it.


Paul Edgar Philippe Martin: Mr. Speaker, all I really want is for the government to do what it promised in the green plan; nothing more, nothing less. I will ask my question and perhaps the Minister of the Environment would like to try to answer it.
The budget is one of the most important environmental tools at a government's disposal. The green plan states clearly and I quote: "An environmental assessment will be made public at the same time that

November 26, 1991
Oral Questions
government policy is announced". Despite this, as we have just seen from his colleague, the Minister of the Environment has been repeatedly brushed aside like an old shoe by his colleagues.


Some hon. members:: Oh, oh.


Mr. Martin:: Mr. Speaker, like a young shoe.
My question is: Will the minister undertake before this Elouse that when the next budget is brought down an environmental assessment of all of its components will be tabled simultaneously? That is the promise of the green plan. Will the minister commit to keeping his promise?


Hon. Jean J. Charest (Minister of the Environment):: Mr. Speaker, I am glad that the hon. member for Lasalle-Emard would rectify himself and at least say that I am a young shoe since I always felt that I have a lot of soul.


Some hon. members:: Oh, oh.


Jean J. Charest: Mr. Speaker, I am glad that the hon. member attracts attention to the fact that this government has committed itself since June 1990 to doing environmental assessments of policies that make their way through the cabinet system.
In fact we are one of the only governments in the world that has obliged itself to this process. It is so new that there is very little methodology around the world from which we can borrow to undergo this process. It is a very important challenge for this government. It would be a very important challenge for any government in the world to do what we have committed to do. We have made great progress in that area. He has witnessed that, and we will continue to make great progress in that area as we today are meeting all the commitments we have made in Canada's green plan.


CANDU III
Mr. J. W. Bud Bird (Fredericton-York-Sunbury):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources.
Some months ago the minister announced that the agreement had been reached with the Conservative Government of Saskatchewan for development of the CANDU III nuclear power prototype in that province.
This followed several months of unproductive negotiations with the Government of New Brunswick.
Subsequently, as we all know, a New Democratic government was elected in Saskatchewan and a policy conference by that party has recommended that the CANDU III nuclear development agreement be abandoned.
Will the minister please advise if the CANDU III nuclear agreement ever was actually signed with the Government of Saskatchewan, and has the new government confirmed its commitment to it?


Arthur Jacob (Jake) Epp: Mr. Speaker, there was a memorandum of understanding signed between the Government of Canada and the then Government of Saskatchewan. In the memorandum of understanding which was then followed by an agreement between Sask Power and Atomic Energy of Canada there is a period of time, namely of six months, whereby the feasibility of a CANDU III system for Saskatchewan is to be explored.
Additionally thereto Saskatchewan would have tremendous advantages in terms of a world mandate on licensing. This would create for Saskatchewan not only the diversification that some people of Saskatchewan look for but which we also need in terms of the kinds of questions that were asked today about the agricultural community and the diversification we need on the prairies.
There is also a back-out clause of $2 million, but I say to the hon. member that the Government of Saskatchewan will examine this and will have to make a determination whether it wants to go this route. I remind the hon. member that Saskatchewan presently provides 20 per cent of the world's uranium. I believe it has the most cost effective uranium mining virtually in the world today. It is the largest single private employer in Saskatchewan, and I would think the Government of Saskatchewan would want to think long and hard before banning the nuclear option.


John Williston (Bud) Bird: Mr. Speaker, in view of the uncertainty that does exist in Saskatchewan concerning this project, is the minister ready to receive competitive initiatives from other provinces of Canada, notably from New Brunswick where I understand that belatedly keen interest still does exist?
November 26, 1991


Arthur Jacob (Jake) Epp: Mr. Speaker, as the hon. member knows, we will fulfil our obligations between Canada and Saskatchewan. That notwithstanding, as the hon. member has pointed out we have had negotiations with N.B. Power.
I would like to move forward on those negotiations. If the Government of New Brunswick and N.B. Power are willing to sit down with us, we are ready to do that.
I say to the hon. member that Canada's reputation in this field is second to none. The CANDU system is a good system. May I say to him as well that the best single plant over the last number of years on a world scale has been Lepreau I in New Brunswick.


MANAGEMENT OF PUBLIC FINANCE
Mr. Benoit Tremblay (Rosemont):: Mr. Speaker, my question is for the Minister of State for Finance, in the absence of the Minister of Finance.
I would like the minister to tell us why his government decided to issue indexed Canada bonds that pay less interest in the short term but put more of the deficit burden on future generations.
Higher unemployment insurance premiums and many government decisions are intended to tell us not to pass on the cost of deficits to future generations. Now they are doing exactly the opposite!


Hon. Gilles Loiselle (President of the Treasury Board and Minister of State (Finance)):: Mr. Speaker, in managing the public finances, in particular revenue and the debt and deficit, the government has a very wide range of options, including indexed bonds, of course.
This is not a widespread policy but it is used in some cases because we think that at a particular time, the market is more receptive to it and thus we can manage our debt to best advantage.


AIRPORT SECURITY
Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, my question is for the Minister of State for Transport regarding the awarding of a security services contract by
Oral Questions
Air Canada at Halifax, Saint John, Moncton and Fredericton airports.
An announcement by the then Minister of Transport in July 1988 said:
These initiatives should help reduce the turnover rate among
airport screening personnel and-airlines will include a specification
to protect current employees' wages and fringe benefits at the level of
the existing contract.
I want to ask the minister: Why has the government not followed through with its policy? Why is it allowing a new company to come in to displace most of the workers and to pay the new workers at a level much less than the contract rate? What is the government going to do to live up to its commitment?


Shirley Martin: Mr. Speaker, as the hon. member knows, the contracts are negotiated between the airlines and the screening contractors. The policy that was announced in 1988 did in fact agree that on re-hires those wages would be protected. In the case of where new employees are hired that policy does not apply.


Guy St-Julien: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources.
For several months, those interested in Quebec's mining industry have been waiting for a new mineral development subagreement in Quebec.
Can the minister tell us today whether Quebec has indicated to the federal government that it intends to sign a new agreement for the Quebec mining industry? If so, will this agreement be signed before the next federal budget?


Benoît Bouchard: Mr. Speaker, the Government of Quebec has set its priorities for regional development agreements. They are industrial development, forestry and tourism. Mining comes fourth. However, I met the Quebec minister of Energy, Madam Bacon, last night. She told me about her concerns. I told her that the Government of Canada would consider Quebec's priorities as its own, since the Government of Quebec always determines the order of priorities for its regional development.

November 26, 1991
Government Orders


PRESENCE IN GALLERY
Mr. Speaker:: I wish to draw the attention of members to the presence in the gallery of the Hon. Gerry Ducharme, Minister of Government Services and Minister responsible for Seniors from the province of Manitoba.


Some hon. members:: Hear, hear.


Mr. Speaker:: I also wish to draw the attention of members to the presence in the gallery of the Hon. Bernhard Wiens, Minister of Agriculture from the province of Saskatchewan.


Some hon. members:: Hear, hear.



ROYAL ASSENT

["At this time I have no indication from the Chair regarding the question raised by the hon. member. That said, I think that the hon. member's interest has been duly noted and the Chair will provide an answer as soon as possible."]
The Acting Speaker (Mr. DeBlois):: I have the honour to inform the House that a communication has been received as follows:
Rideau Hall Ottawa
November 26, 1991 Sir,
I have the honour to inform you that the Hon. Claire CHeureux-Dube, Puisne Judge of the Supreme Court of Canada, in her capacity as Deputy Governor General, will proceed to the Senate Chamber today, November 26, 1991, at 3.30 p.m., for the purpose of giving Royal Assent to certain bills.
Yours sincerely,
Anthony P. Smith
Deputy Secretary Policy, Program and Protocol



Mr. David Dingwall (Cape Breton-East Richmond):: Mr. Speaker, on Friday, while debating Bill C-35, we had suspended the debate pending a ruling by the Chair with regard to certain procedural arguments that I had raised on that particular occasion.
I am wondering if the Chair could indicate to the House as to when we might expect a ruling. We are proceeding with debate this afternoon on some of the legislation which had been referred to in the procedural arguments that I had raised. I am wondering if the Chair could see its way clear to inform the House as to an approximation of when this decision will be made.


The Acting Speaker (Mr. DeBlois):: At this time I have no indication from the Chair regarding the question raised by the hon. member. That said, I think that the hon. member's interest has been duly noted and the Chair will provide an answer as soon as possible.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of Bill C-19, an act respecting banks and banking, as reported (with amendments) from the Standing Committee on Finance; and the motion of Mr. Rodriguez (p. 5340).
The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: The question is on Motion No. 2 standing in the name of the hon. member for Nickel Belt. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
November 26, 1991

And more than jive members having risen:


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.

We now proceed to Motion No. 3, standing in the name of Ms. Callbeck.


Catherine S. Callbeck: Motion No. 3.
That Bill C-19 be amended in Clause 324 by adding immediately
after line 31 at page 168 the following:
"(3) A person who in good faith makes an oral or written communication under subsections (1) or (2) shall not be liable in any civil action arising therefrom.

She said: Mr. Speaker, this is the same motion that I spoke to yesterday regarding Bill C-4, the trust bill.
What this motion does is protect people who provide information to the auditor in good faith. It is a motion which I feel will improve the soundness of Canadian financial institutions because it prevents a lawsuit against anyone who has information which could help the auditor or an actuary in his work.
I feel this protection is important because an employee may have information that would help an auditor prepare a better audit or a more thorough audit, but that person may be reluctant to come forward because of fear of a lawsuit.
This amendment would clear the way for that person to come forward to the auditor or to the actuary, give them information, which as I said could help the auditor prepare a better audit, better financial statements, and so could improve the soundness of Canadian financial institutions.
Mr. Speaker, because of those reasons I would encourage all members of this House to support this motion.


Donald Alex Blenkarn: Mr. Speaker, I want to compliment the member for Malpeque for this well-reasoned amendment. As in Bill C-4, I have an amendment, which I am sure the hon. member for Malpeque would accept, to the English version. It is our view that the English version that I am now submitting is more appropriately in line with the existing French version. With the unanimous consent of the House, I would like to have the motion made by the hon. member for Malpeque altered in the English version so that the English version will read:
Government Orders
(3) A person who in good faith makes an oral or written communication under subsections (1) or (2) shall not be liable in any civil action arising from having made that communication.
I believe that is acceptable to my friend from Malpeque.


John R. Rodriguez: Mr. Speaker, since we in this comer of the House so ably defended that motion yesterday afternoon, and in fact forced the government into accepting it, we have no problem with the same principle of whistleblowing being applied in Bill C-19 as was in Bill C-4.


The Acting Speaker (Mr. DeBlois):: Is there unanimous consent for the amendment?


Some hon. members:: Agreed.
Amendment (Mr. Blenkarn) agreed to.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion, as amended?


Some hon. members:: Agreed.
Motion No. 3, as amended, agreed to.


The Acting Speaker (Mr. DeBlois):: Motions Nos. 2A and 2F are grouped for debate.


Gilles Loiselle: Motion No. 2A.
That Bill C-19 be amended in Clause 308 by striking out line 3 on page 161 and substituting the following:
"ing principles, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants."
Motion No. 2F.
That Bill C-19 be amended in Clause 323 by striking out line 47 on page 167 and substituting the following:
"generally accepted auditing standards, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants."


Donald Alex Blenkarn: Mr. Speaker, these two motions do the same thing. They incorporate the Canadian Institute of Chartered Accountants Handbook as the standard of care that we require from auditors and accountants certifying the statements of financial institutions. The concept was produced by the Senate in its review of the bill. We are very pleased to go

November 26, 1991
Government Orders
along with it, and I believe the House ought to do so also, as it did in Bill C-4.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


Catherine S. Callbeck: Mr. Speaker, could I have you repeat the question, please?


The Acting Speaker (Mr. DeBlois):: The question is on Motion No. 2A standing in the name of the Minister of State for Finance. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.
Motion No. 2A agreed to.


The Acting Speaker (Mr. DeBlois):: The vote on Motion No. 2A applies to motion No. 2F.
Motions Nos. 2B, 2D, 2E, 2G, 3A, 3B, 3C, 3D, 3E, 3F and 3G are grouped for debate.


John R. Rodriguez: Motion No. 2B.
That Bill C-19 be amended in Clause 314:
(a)	by striking out lines 5 to 11 at page 163 and substituting the following therefor:
"314.(1) The shareholders of a bank shall, by";
(b)	by striking out line 17 at page 163 and substituting the following therefor:
"(2) The remuneration of the".


The Acting Speaker (Mr. DeBlois):: Since these motions are by the same mover, I suggest that the Chair, in order to accelerate the proceedings, be allowed to dispense with reading the other motions. Shall I dispense?


Some hon. members:: Agreed.


John R. Rodriguez: Motion No. 2D.
That Bill C-19 be amended in Clause 320 by striking out line 10 at page 166 and substituting the following therefor:
"320.(1) The auditors of a bank".
Motion No. 2E.
That Bill C-19 be amended in Clause 323:
(a)	by striking out line 34 at page 167 and substituting the following therefor:
"323.(1) The auditors of a bank";
(b)	by striking out line 43 at page 167 and substituting the following therefor:
"(2) The examination of the".
Motion No. 2G.
That Bill C-19 be amended in Clause 324:
(a)	by striking out line 1 at page 168 and substituting the following therefor:
"324.(1) On the request of the";
(b)	by striking out lines 12 and 13 at page 168 and substituting the following therefor:
"as are, in the opinion of the auditors, necessary to enable the
audi-";
(c)	by striking out line 16 at page 168 and substituting the following therefor:
"On the request of the audi-";
(d)	by striking out line 26 at page 168 and substituting the following therefor:
"opinion of the auditors, neces-";
(e)	by striking out line 28 at page 168 and substituting the following therefor:
"of the auditors of the bank; and";
(f)	by striking out line 29 at page 168 and substituting the following therefor:
"(b) provide the auditors with".
Motion No. 3A.
That Bill C-19 be amended in Clause 325:
(a)	by striking out line 33 at page 168 and substituting the following therefor:
"ing, require that the auditors of a";
(b)	by striking out line 35 at page 168 and substituting the following therefor:
"extent of the procedures of the";
(c)	by striking out line 38 at page 168 and substituting the following therefor
"the auditors enlarge or extend the";
(ct) by striking out line 41 at page 168 and substituting the following therefor:
"any particular case, and the audi-";
(e) by striking out line 46 at page 168 and substituting the following therefor:
"require that the auditors of a bank".
November 26, 1991

He said: Mr. Speaker, all of these motions, from 2B to 3G, have to do with placing two auditors back into the Bank Act. Because of the collaboration between the Conservatives and the Liberals in the committee, lo and

November 26, 1991
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behold, they removed from the Bank Act the requirement for two auditors.
I opposed it in the committee when that was done and I am opposing it here. I have placed motions in this report stage which would put back into the Bank Act the requirement for two auditors.
As complex a business as banking is now and is going to be with the passage of Bill C-19 and all these other financial institution acts, I cannot see for the life of me why we will be removing this important tool for the Superintendent of Financial Institutions.
I pointed out in earlier debate that OSFI depends a great deal on external audits of financial institutions.
When we are talking about banks we are talking about the most powerful institutions in the economic structure of the country. Even the banks did not want to give up the requirement for two auditors. They saw it as an advertisement for their soundness. They are projecting to the public the image of a sound financial institution. The public is reassured in this country because the banks are regulated and two auditors are required.
I do not think that the Conservatives on the committee checked with the Minister of State for Finance before they took that position in the committee. They actually agreed to remove from the banks the requirement for two auditors.
I found it very strange, particularly when financial institutions in the trust sector are falling by the wayside. What we need are more effective controls on the banks. The member for Mississauga said it in a previous debate on this question. He conjured up the image of the Northland Bank and the CCB and he conjured up the image of "after you Alphonse". Why do you have two auditors? Now he is saying "after you Gilles".
The problem did not lie in the fact that we had two auditors. It did not affect the case of the Northland Bank and the CCB. Maybe what we have to look at is how we regulate the auditors reporting to OSFI. It has been to one auditor. When we get into these large financial institutions-and we are not talking about small financial institutions-we have to have that second opinion.
You go to the doctor today and you say I am not feeling well. He examines you and says: "I think you have a problem with your liver". If the patient does not like what the doctor says and wishes a second opinion, he says: "You have a problem with your kidney".
I think that the back-up system is very important for an effective regulatory system for financial institutions. We had Michael Mackenzie before the finance committee dealing with the investigation into the Standard Trust operations. We had only one meeting to examine Standard Trust. The chairman did not see fit to call on another meeting to continue the investigation. Michael Mackenzie, superintendent of OSFI, said how much they depended on the external auditing provided to OSFI about the financial institution. He stressed over and over again how often he depends on the outside auditing because OSFI does not have the wherewithal to audit every single financial institution in the country.
What I have attempted to do in these motions is to put back into the Bank Act what a chairman who was anxious to get a bill moved through the committee was quite willing to give up, the two auditors for banks. I ask the minister to reconsider because it was a hasty action. Once these bills are passed we will be talking about a whole new animal. A whole new beast will be bom.
Banks will be able to own insurance companies. Banks will be able to own trust companies. Banks will be able to do all sorts of things. What are we saying? We are saying well, we will take off one of the watch-dogs. We will take off one.
I suggest this was a hasty action in committee by a chairman who was willing to show how good he was in getting very lengthy bills through committee. I think it was ill thought out and very hasty.
I say to the minister, let us put back the two auditors into the Bank Act. I would even go so far as to suggest, as I have suggested in debate on Bill C-4, that for the large trust companies we ought to have the two auditors as well, because they too are going to be allowed to grow in a whole new way. In a very invasive way they are going to be allowed to grow. The public, the investors, the shareholders and, above all, Canadian taxpayers, are
November 26, 1991

always called upon through the deposit insurance whenever there are pieces to be picked up.
If this can limit the number of pieces that have to be picked up, surely the minister can see the reasonableness of the argument that we should put those two auditors back in place in the Bank Act.


Donald Alex Blenkarn: Mr. Speaker, we have had this discussion on a number of occasions. We had the discussion on Bill C-4.
A bank is entitled, of course, to continue to have two auditors if it so desires. Some of the major banks have indicated for the reasons my friend sets out that it is perhaps a good thing to advertise that you have two auditors, but as far as supervision is concerned, that is not necessary. As far as the Estey commission was concerned, it was not necessary, and as far as the Standing Committee on Finance studying the matter in 1985 in its report that his colleague from Regina-Qu'A-ppelle was involved in, it was not necessary. It was not necessary then; it is not necessary now, so we will be opposing the amendments.


Catherine S. Callbeck: Mr. Speaker, this morning I spoke on a similar motion to the Trust and Loan Companies Act, Bill C-4. This motion is to amend the Bank Act and it is requiring two auditors. As I mentioned this morning, the Standing Committee on Finance really rejected this idea and the Superintendent of Financial Institutions sees no need to have two auditors.
As was mentioned in the committee and also by the member for Mississauga South this morning, if you have two auditors then one auditor could mistakenly think that the other one is doing something and things could get missed altogether.
Also the Estey inquiry that looked into the failure of the Canadian Commercial and Northland banks certainly indicated that it would not have made any difference if we had had two auditors. I want to repeat that the Superintendent of Financial Institutions sees no reason to have two auditors. This idea was rejected by the finance committee, and if it is not necessary, if there is no need for it, why inflict the extra cost on financial institutions which will be passed on to the Canadian public in the long run?
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Mr. Speaker, we will be voting against this amendment.


Maurice Adrian Dionne: On a point of order, Mr. Speaker. I allowed my name to stand as seconder of this motion. I simply want to explain that I intend to vote against the proposition of the hon. member.


Gilles Loiselle: Mr. Speaker, I would like to thank the hon. member for Nickel Belt and the hon. member for Malpeque for their intervention. I think the hon. member mentioned the complexity of the present institution. He has indicated one point, that maybe the member for Mississauga South might have acted without consulting the minister. I would like to repeat that the hon. member has consulted with the minister, and we have been in touch for years on these issues. I must say that I am very pleased that the hon. member for Mississauga South has brought his experience and his knowledge.
I would say that I was also very impressed and even though I was not in the House through the debate or in committee, I have followed that very closely. I was always very impressed by the quality of the intervention of all members, even though we do not always agree on certain amendments. I think these are extremely complex issues of great importance for Canadians. I think what we are doing now is preparing a very good bill.


Mr. David D. Stupich (Nanaimo-Cowichan):: Mr. Speaker, I noted that the hon. member for Malpeque said that Judge Estey did not recommend that there be two auditors. I may not have quoted it correctly, but one of his recommendations was that there be no change in the dual auditor system as provided by section 237 of the Bank Act. When Judge Estey was looking into the collapse of CCB and the Northland Bank, he felt that the dual auditor system was a good one and should be retained.
Canada has had a pretty good reputation in its banking systems, particularly in the larger ones in which the dual auditor system has been in effect for quite some time. I do not know why we are fixing it if it is not busted. The system is working. The hon. member for Mississauga and the hon. member for Malpeque suggested earlier in the debate-and I feel I have to stand up for the professional auditors, the chartered accountants-that it costs more.

November 26, 1991
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Maybe I was a little sensitive but the implications of their remarks as I heard them was that one firm would be following the other around doing exactly the same thing and doubling the cost to the institution of the auditing. That is not being fair to the chartered accountants.
Do you think they would be so dumb that they would simply follow the trail started by one firm, do exactly the same thing and it would be double the cost? I am sure there would be some increase. With two firms doing the work, sharing the work, there would have to be some consultation as to which would be the lead auditor and which would be the second. A plan would be developed, but they would not be chasing each other around doing the same work. There would not be double the cost.
The other argument I heard this morning on Bill C-4, again from both members, was that with two there they might make a mistake. They might both overlook one critical element of the investigation. Again, we are talking about professionals doing this. They are looking at the work, looking at what has to be done. They plan it. Even one auditor sits down and plans the work before the work is ever started.
They would plan how they were going to proceed with the audit, how they were going to be doing it during the year and share the load. They would make sure that nothing was overlooked. It is always possible, but it is more likely to be overlooked if there is only one firm on the job than if there were two. Two of them looking at it and looking at the whole picture and deciding how to share it are more likely to do total coverage of everything that has to be done than one who just might be in a hurry and might overlook something.
I think it is important with the projected growth in the individual banks in Canada that they not look to one auditor to be the auditor for any one bank. It puts an awful load on any of the existing Canadian firms to take on total responsibility for one of, say, the major five. There would be a tendency for that firm to specialize, if you like, in that area. Although the same firm is not supposed to deal with competitors in business, there would be a tendency for that firm to have some involvement in the audit of more than one bank which would mean that firm then would be totally dependent or very dependent upon that one aspect of business in our
country which is not good for the firm and not good for the bank.
It is good that they have two different firms now and good that the five among them would be having other firms involved as well so that nobody is sort of following a route from year to year without having other experiences to draw on.
It is good for the firms to have that variety of experience. It is good for the banks and good for Canada as a whole in supporting its banking system and being proud of the record of its banks in Canada with respect to failures and non-failures. It is good that they have had this system of two auditors.
As I have said, Judge Estey recommends that it be continued and I think the least we can do in the House is insist that it be continued at least for the larger banks.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


An hon. member:: There is no minister in the House.


Mr. Pat Sobeski (Cambridge):: Mr. Speaker, I was just reviewing my notes on this particular amendment when it was before the finance committee. I supported the member for Nickel Belt in voting to have two auditors.
The point I would like to make was that the representation we had from the Canadian Bankers' Association basically made a couple of points that it was not any more expensive to maintain a two auditor system versus a one auditor system.
Also, the point was raised that by having two auditors, because there is a requirement that there be a rotation for those banks that have two auditors, it was often easy to switch one auditor and still have some consistency with the other auditor, whereas if it went to one auditor you would lose that consistency.
The president of the Canadian Bankers' Association also pointed out that the two auditor system is the subject of some study abroad and it appears that other international jurisdictions may be adopting a two auditor system when Canada is going to a one auditor system.
I thought I should rise in my place to indicate that previously I had supported the member for Nickel Belt in keeping the two auditor system. I think it is fair for me
November 26, 1991

to rise now and give those particular arguments as to why I support the member for Nickel Belt.


John R. Rodriguez: Mr. Speaker, I rise on a point of order to apologize to the member for Cambridge because I think in my comments I had said all the Tories and all the Liberals had voted to withdraw these two auditors for the banks. Now I apologize. I am glad that the record has been corrected.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed will please say nay.


Some hon. members:: Nay.
Acting Speaker (Mr. DeBlois): In my opinion the yeas have it.
And more than five members having risen;


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.



THE ROYAL ASSENT

[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable Deputy to the Governor General
desires the immediate attendance of this honourable House in the
chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the House went up to the Senate chamber.
[Stage Direction]
And being returned:
Royal Assent
['There are 59 notices of motions in amendment to Bill C-28, an act respecting insurance companies and fraternal benefit societies at report stage.\nMotion No. A, standing in the name of the Minister of State for Finance will be debated and voted upon separately.', "Motions Nos. B and 3B, standing in the Minister's name, will be grouped for debate but voted on separately-", 'Motion No. C standing in the name of the Minister of State for Finance will be debated and voted upon separately.', 'Motions Nos. 1, 6 and 7, standing in the name of the hon. member for Nickel Belt, will be grouped for debate but voted on as follows: (a) Motion No. 1 will be voted on separately; (b) The vote on Motion No. 6 will apply to Motion No. 7.', 'Motions Nos. 1A, 2A, 2B, 2C, 2D, 2E and 2F standing in the name of the Minister of State (Finance) will be grouped for debate, but voted upon as follows:\n(a)\tMotion Nos. 1A, 2A and 2F will be voted upon separately.\n(b)\tA vote on Motion No. 2A will apply to Motion No. 2C.\n(c)\tA vote on Motion No. 2B will apply to motion No. 2D.\nMotions Nos. 2 and 8 standing in the name of the hon. member for Nickel Belt will not be selected in that they were both moved, debated and negatived in the Standing Committee on Finance which studied this bill at the committee stage.', 'Motion No. 2G, standing in the name of the Minister of State for Finance, will be debated and voted on separately. Motion No. 3, standing in the name of the hon. member for Nickel Belt, will be debated and voted on separately.', 'Motion No. 3A standing in the name of the Minister of State for Finance will be debated and voted upon separately.\nNovember 26, 1991', "Motions Nos. 3C and 3D standing in the minister's name will be grouped for debate with the vote on Motion No. 3C applying to Motion No. 3D.\nMotions No. 3E, 5A, 5B, 1C, 9A, 10B, 11A and 11B, all standing in the name of the Minister of State for Finance are technical in nature and seek to amend the French and English versions of certain parts of the bill to ensure that both versions have the same meaning. They will be grouped for debate with a vote on Motion No. 3E applying to the remaining motions.", 'Motions Nos. 3F, 3H and 11D, standing in the name of the Minister of State for Finance, will be grouped for debate. The vote on Motion No. 3F will apply to Motions Nos. 3FI and 11D.', 'Motions Nos. 3G and 11C standing in the name of the hon. member for Nickel Belt will be debated together with the vote on Motion No. 3G applying to Motion No. 11C.', 'Motions Nos. 4, 5, 11 and 12, standing in the name of the hon. member for Malpeque, will be grouped for debate with the vote on Motion No. 4 applying to Motions Nos. 5, 11 and 12.', 'Motion No. 4A standing in the name of the Minister of State for Finance will be debated and voted upon separately.', 'Motions Nos. 5C and 11B.1, standing in the name of the Minister of State for Finance, will be debated together, with the vote on Motion No. 5C applying to Motion No. 11B.1.', 'Motion No. 6A standing in the name of the Minister of State for Finance will be debated and voted upon separately.\nMotions Nos. 7A and 7B standing in the name of the Minister of State for Finance will be grouped for debate but voted upon separately.\nGovernment Orders', 'Motions Nos. 7D and 7E, standing in the name of the Minister of State for Finance will be grouped for debate but voted on separately.', 'Motion No. 9 standing in the name of the hon. member for Malpeque will be debated and voted upon separately.', 'Motion No. 10, standing in the name of the hon. member for Nickel Belt, will be debated and voted on separately.', 'Motions Nos. 10A and 10C standing in the name of the Minister of State for Finance will be debated together but voted upon separately.', 'Motion No. 13, standing in the name of the Minister of State for Finance, will be debated and voted on separately-', 'Motions Nos. 14, 15, 16, 17, 18, 19, 20 and 21 standing in the name of the Minister of State for Finance are technical in nature seeking to harmonize Bill C-28 with the other financial institutions bills. The Chair proposes to group these motions for debate with a vote on Motion No. 14 applying to Motion No. 15, 16, 17, 18, 19, 20 and 21.\nFor the convenience of the House, I will recapitulate: Motions Nos. 2 and 8 will not be selected.', 'Motion No. A will be debated and voted on separately. [English]\nMotions Nos. B and 3B are grouped for debate but will be voted upon separately.', 'Motion No. C will be debated and voted on separately.', "November 26, 1991\nPrivate Members' Business", 'Motions Nos. 1, 6 and 7 are grouped for debate. Motion No. 1 will be voted upon separately. A vote on Motion No. 6 applies to Motion No. 7.\nMotions Nos. 1A, 2A, 2B, 2C, 2D, 2E and 2F are grouped for debate.\nMotions Nos. 1A, 2A and 2F will be voted upon separately. A vote on Motion No. 2A will apply to Motion No. 2C. A vote on Motion No. 2B will apply to Motion No. 2D.', 'Motion No. 2G will be debated and voted on separately. Motion No. 3 will be debated and voted on separately.\nMotion No. 3A will be debated and voted on separately-\nMotions Nos. 3C and 3D will be grouped for debate with the vote on Motion No. 3C applying to Motion No. 3D.\nMotions Nos. 3A, 5A, 5B, 7C, 9A, 10B, 11A and 11B will be grouped for debate with the vote on Motion No. 3A applying to the remaining motions.', 'Motions Nos. 3F, 3H and 11D will be grouped for debate. The vote on Motion No. 3F applies to Motions Nos. 3H and 11D.', 'Motions Nos. 3G and 11C will be grouped for debate with the vote on Motion No. 3G applying to Motion No. 11C.\nMotions Nos. 4, 5, 11 and 12 will be grouped for debate. The vote on Motion No. 4 will apply to Motions No. 5, 11 and 12.', 'Motion No. 4A will be debated and voted on separately-', 'Motions Nos. 5C and 11B.1, standing in the name of the Minister of State for Finance, will debated together, with the vote on Motion No. 5C applying to Motion No. 11B.1.', 'Motion No. 6A will be debated and voted on separately. Motions Nos. 7 A and 7B will be grouped for debate but voted on separately.', 'Motion Nos. 7D and 7A will be grouped for debate but voted on separately.\nMotion No. 9 will be debated and voted on separately.\nMotion No. 10 will be debated and voted on separately-', 'Motions Nos. 10A and 10C will be grouped for debate but voted on separately. Motion No. 13 will be debated and voted on separately.', 'Motions Nos. 14 to 21 inclusive will be grouped for debate with the vote on Motion No. 14 applying to the remaining motions.', "It being 5 p.m, pursuant to Standing Order 30(6), the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper."]
The Acting Speaker (Mr. DeBlois):: I have the honour to inform the House that when the House went up to the Senate Chamber, the Deputy Governor General was pleased to give, in Her Majesty's name, the Royal Assent to the following bills:
Bill C-ll, an act to amend the Railway Act (grain and flour subsidies)-Chapter No. 37.
Bill C-8, an act to provide for the dissolution or transfer of certain Crown corporations and to amend certain acts in consequence thereof-Chapter No. 38.



[Stage Direction]
The House resumed consideration of Bill C-19, an act respecting banks and banking, as reported (with amendments) by the Standing Committee on Finance.
The Acting Speaker (Mr. DeBlois):: Motions Nos. 6, 8 and 11 are grouped for debate.


John R. Rodriguez: Motion No. 6.
That Bill C-19 be amended in Clause 416 by striking out lines 17 to 19 at page 215 and substituting the following therefor:
' 'business of insurance to the extent prohibited or restricted by the
regulations.
(2) Except as permitted in the Act or the regulations, a bank shall not act in Canada as".


The Acting Speaker (Mr. DeBlois):: Motion No. 8 has been withdrawn.


John R. Rodriguez: Motion No. 11.
That Bill C-19 be amended by adding immediately after line 17 at page 277 the following new clause:
"475. Notwithstanding anything in sections 468 to 474, no bank may acquire or increase a substantial investment in a body corporate
(a)	if the body corporate is an insurance bank to which Parts I to VII of the Canadian and British Insurance Companies Act apply or an insurance corporation incorporated by or under an Act of the legislature of a province; or
(b)	if the activities of the body corporate are substantially similar to those of a body corporate described in paragraph (a)." brev

He said: Mr. Speaker, I want to deal first of all with Motion No. 6. Motion No. 6 has a bit of a history because when the finance committee dealt with the financial

Government Orders
institutions bill we dealt with Bill C-83 first. Bill C-83 is now known as Bill C-4. Bill C-83 was its name in a previous Parliament. Bill C-4 is its name in the present Parliament.
We have no problem in this party, in this comer of the House, with banks being able to sell, to market or to retail insurance. We have a real serious problem with knocking down the pillars and allowing banks to own insurance companies. We have a real serious problem with that, but we have no problem at all with joint ventures that would allow banks to retail the product of an insurance company.
When we dealt with Bill C-83 there was a clause that went against the process or the principle of natural persons. The English version was different from the French version. The English version said that a bank would be able to do any business of insurance except what is prohibited by legislation. The French version said that they cannot do anything except what we tell them they can do.
What we did and what the committee agreed to was to harmonize the French version with the English version: they can do anything except what we prohibit them from doing. That is a natural person's approach. That is the approach that is used in the whole Bank Act except in this one issue.
It is fairly obvious that members on the government side agreed to that change, to that harmonization. There was nothing wrong with it that they saw at that time that they could object to. At least they did not object to it when I proposed the motion in committee. The amendment was supported, but I do not know what happened between that time when Bill C-83 finally finished committee stage and we got to the Bank Act.
Lo and behold, in clause 416 the government reversed what we had done in Bill C-83. I think what happened was a voice in the insurance industry, probably in Great West Life, twisted the arms of the ministry and of the government and got what was originally in Bill C-83.
It is not acceptable to us. They cannot accept the principle of natural persons all along the line and then, when it suits their purpose, just boot it out the door.
We are trying to correct the mistake that was made in our view. We are saying in this particular amendment: no, let us go back to the principle of natural persons. It seems to me that is fair.
The other motion, Motion No. 11, again fulfils the principles that we have tried to make in this debate, that banks ought to do the things related to banks and banks ought not to be allowed to own insurance companies.
In our amendment to Bill C-4 we said that trust and loan companies ought not to be allowed to own insurance companies. In this particular motion we are saying banks ought not to be allowed to own an insurance company.
If the government thinks for one moment that it is protecting the insurance industiy by putting in these kinds of rules, it is living in Fantasyland. It is over in Fantasy Gardens with Faye Leung and Bill Vander Zalm. It is in Fantasy Gardens.
I want to say that the insurance companies do not stand a chance against the banks. The banks right now are positioning themselves. I could just see the debate within the banking community as to whether they should buy an insurance company or start one up or squeeze. I think they have opted for starting up insurance companies and I think, with the ability they have right across the country with their branch system, the insurance companies will not stand a chance and insurance companies will collapse.
I think the government is really fighting a rear-guard action. I have just been looking at an article which appeared in The Toronto Star of October 12, 1991. The story is very interesting. It pointed out that in the United States a U.S. bank won a battle to be an insurer. I refer to the story here because I think it is the trend. In part it reads:
In a big victory for banks seeking broader powers, the U.S. government has decided not to appeal a court ruling that clears the way for Citicorp to underwrite and sell insurance nation-wide. The decision could be a fatal blow to efforts to strike down a 1990 Delaware law that permits major banks to market insurance products nation-wide via subsidiaries in the States.
The powerful insurance lobby which staunchly opposes the law immediately picked up the legal battle started by the federal reserve, asking the Supreme Court on TUesday to hear its appeal. But the chances of that tactic succeeding are considered slim.
November 26, 1991

What we have is the reality that banks are going to be taking over the insurance industry.
This motion would keep the animals in their cages. We have attempted to do that. We say what we should do is keep them in the cages. They could enter agreements. They could have joint ventures and we would regulate the ventures. It seems to me that is the way to go if we want to preserve the insurance industry and allow it to grow; not to have the banks own the insurance companies. It seems to me the minute they start doing that you get a concentration of activity.
We dealt with the question of the concentration of ownership when we recommended the sliding scale. We saw two types of concentration, one of ownership and one of activity. On the concentration of ownership we dealt with the sliding scale and on the wide ownership, the 10 per cent.
Having done that we now move into the deal with the concentration of activity. We say if you put these lions in the cages and these cobras in their cages and these mongooses in their cages, then in fact we are on our way to properly regulating them. We will prevent a concentration of ownership and activity, which is absolutely detrimental to consumers the minute you melt everything down to one or two or three large financial institutions. That is the trend in the United States.
It bothers me when I hear all this talk about global competition and that somehow you have to be bigger because bigger is better. I think smarter is better. All I keep hearing is that somehow to be a better competitor you have to be bigger. Remember I have two motions here, but remember that bigger is not necessarily better and having one or two or three large financial institutions is not in the best interest of the consumer. You know what happens to the prices and we do not have effective enough anti-monopoly legislation in this country. At least in the United States they have some effective anti-monopoly legislation, but we do not have it here in Canada and now we are opening up the cages and letting them commingle. In the end it will be that lion that you see on the Royal Bank grabbing hold.


Donald Alex Blenkarn: Mr. Speaker, these are the same motions we dealt with in Bill C-4 this morning. What we are talking about here is how we handle insurance. The queries behind our bills are that the institutions will stay within their own frame of reference, insurance companies will sell insurance,
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banks will do banking and trust companies will do trust service including the deposit work that trust companies do. The product of insurance will not be marketed in a deposit taking institution.
There is nothing wrong with a bank wanting to buy an insurance company or create an insurance company. That type of cross ownership is behind the concept of these bills. My friend makes the same argument, and the arguments in this particular case are exactly the same as they were this morning. The theory behind the legislation in this reform is to make sure that the insurance companies stay as insurance companies and that the banking and trust industries do not get into that business by marketing their products in their branches.
With respect to the other amendment, the same arguments apply as this morning. A bank will be permitted to acquire an insurance company or incorporate an insurance company and we therefore cannot accept my friend's amendment.


Catherine S. Callbeck: Mr. Speaker, these are really the same amendments as we had this morning on Bill C-4, the trust act. The first one, of course, is regarding the power of banks to sell all types of insurance.
As I mentioned earlier, we heard all kinds of arguments on this issue. We had briefs presented to us with arguments that were for banks selling insurance. We had briefs and witnesses who made presentations for the other side of the argument.
We went into this in great depth. After studying the issue, we in the Liberal Party believe that banks should not sell all types of insurance. I have spoken on this before. The reasons for this are on the record here two or three times. I will be elaborating on those again when I speak on this bill on third reading.
With regard to the other amendment which we have before us, it is restricting banks from owning insurance companies. We believe that since widely held insurance companies will be able under this new legislation to own a bank, then it seems logical that banks should be able to own an insurance company.
I know there have been concerns raised about corporate concentration. That will be dealt with in a couple of ways. One is the Competition Act and the other is the Minister of Finance. He can refuse a merger if it would not serve the best interests of the Canadian financial institution system.

November 26, 1991
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One other point I want to make is that the Conference Board of Canada told the finance committee that it sees no competition problems if banks are given the power to buy insurance companies.
I will be voting against both of those amendments.


Simon Leendert de Jong: Mr. Speaker, I too wish to intervene in the debate on these amendments. Really these amendments go to the heart of what the government is attempting to do and our opposition to what the government is attempting to do.
The amendments of course being debated are the ones that would prevent banks from owning insurance companies. The government wants to collapse the four pillars so that banks can own insurance companies, or trusts can own banks and banks can own trusts and so forth and so on.
Many of the points in terms of our opposition were raised by my colleague, the member for Nickel Belt, and I think he raised them very forcefully and very eloquently-
Perhaps I can start my remarks where in a sense he left off. He said that the notion of beans is not necessarily the way to survive. His thought was that smartness was more important and was a greater asset in terms of surviving than beans. I think he is right on.
We saw the decade of the eighties where huge new corporate entities were formed, levered buy-outs with huge sums of money, billions of dollars. We are finding now that society, especially the American society, is paying a heavy price for it. They created monsters. They were like dinosaurs. There was no intelligence. They were big, they were huge but there was no intelligence. Many of them got into fields that they had no experience in like real estate. They ended up having to start divesting.
We know some of our Canadian boys who went in, the experience of Mr. Campeau. What a tremendous ruin people like that have done to institutions, to businesses that have taken years and years to build up. You would almost think that they were revolutionaries out to destroy the system.
They laid in ruin many once proud and large corporate entities, especially in the United States. Many of these entities, these dinosaurs that were created, have tremendous levels of debt that they cannot service. They are having to sell pieces off. In other words they were like dinosaurs. They were big all right but they had tiny little minds. They were not smart.
It is like our government. It got its majority all right, but it has a tiny little mind because these Tories sometimes move slow. What was the in thing at the beginning of the eighties we have now discovered has become a disaster in many areas. When the Tories launch something it is like launching one of those huge boats, an oil tanker. When they are midway in the Atlantic they have to start slowing down in order to slide into port. Once the Tories launch something, it takes them almost a decade to bring it to legislation. Now we have realized that what they launched in the beginning of the 1980s is no longer appropriate.
If they were really smart and quick they would withdraw this legislation. We on this side of the House suspect that it is a recipe for disaster. Canada will end up with some huge financial institutions and while they will be big, they will not be smart. They will not have the appreciation of the markets and the different businesses they are involved in.
I also think of the many insurance agents who have served Canada well. They have enabled Canadians to choose from a very wide variety of insurance packages and policies. Of course, by allowing the banks to not only own but sell insurance policies, the network that has been built up over the years in Canada will be threatened. The livelihoods of many of these insurance agents will also be threatened.
I do not know what sort of regulations the government is contemplating when the bank gets into the insurance business. Will those insurance policies be allowed to be sold in the bank? What will the regulations be? Will insurance agents also be able to sell those packages along with the other insurance packages they sell? I do not know what the regulations will be.
I understand that this aspect has not really been discussed by the finance committee and that is unfortunate. I submit that at least the finance committee should have spent some time listening to the agents and discussing what possible regulations might be put into
November 26, 1991

effect to ensure that the network of agents we have in this country is not irreparably harmed. If that network is broken, then the competition in this country will be less and there will be very few insurance companies with a tremendous amount of monopoly power. While initially the consumer might see some benefit, we know that once true competition is destroyed, in the end the consumer pays the price.
What I am afraid of is that in five or ten years from now when we revisit this legislation, we will hear speeches in this House and other places saying: "I wish we had been smarter in 1991. Boy, what a mistake we made in 1991". There is no excuse. We have seen what happened in the 1980s in the United States with deregulation and the large conglomerates that were created by the levered buyouts. We know in 1991 that there was a tremendous costly mistake made in the United States and there is no earthly reason why we in Canada should be committing the same mistakes.
Surely we can learn from the 1980s from this past decade and come to the conclusion that what we are entering into here is already outdated by a decade. The time has come not to go into bigness, but to move away from bigness and to move into smartness, into appropriateness. That is the recipe for a healthy economy. That is the recipe for providing good, essential services to the Canadian public. In the end, that is what the public interest should dictate. It is shameful that this government, supported by the Liberals, is bringing in legislation using concepts that are outdated, that are gone.
I hope the Leader of the Liberal Party will also begin to realize, judging from his comments he made this past weekend at the Liberal think tank, that he too is parroting notions that were popular in the 1980s and that are being discarded for the decade of the 1990s.
If we are going to remain competitive as a nation, we need smartness and not bigness. That is the recipe surely for prosperity.
Unfortunately, the legislation is a reactive legislation. It is legislation based on popular hip notions of the neo-Conservative era of the 1980s. They have been brought into disrepute, particularly because of the experiences in the United States.
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There is no excuse for us to continue with these outdated motions. For heaven's sake let this House wake up and thoroughly defeat this government legislation. Surely government members and members of the Liberal Party should realize that the amendments introduced by my colleague from Nickel Belt really are needed.
Let us support his amendment.


Brian L. Gardiner: Mr. Speaker, I want to intervene in this debate just for a brief moment.
What I think most Canadians are going to find is really the hidden element in this legislation. In a number of years to come, as the speaker from Regina has just mentioned, Canadians in the business community and consumers are going to find out just what kind of serious damage this government has done to the economy of Canada.
In particular, I want to congratulate the member for Nickel Belt who has been doing a stellar job. I have not attended committee meetings in which this bill has been discussed.
In this House yesterday, today and I know in the days to come, this is an example. It is an example of an effective opposition giving this bill a detailed look. I know the member for Nickel Belt will sit on the other side of the House after the next election.
I know his concern over the economy will bode us well and bode the country well in his clear knowledge of the financial institutions in the country.
We find it hard to understand why the Liberals are now cosying up to the Tories so much. It is hard to tell these days, I guess.
This amendment brought in by my colleague from Nickel Belt would prohibit the banks from purchasing and picking up insurance companies in Canada. You would end up, as the previous speaker said, with this kind of monolithic bigness.
It seems in some sense that this government has been drawn to "bigger is better" and the monolithic kind of financial empires that it seems to favour are going to serve Canadians better.
I would second the comments from the member for Regina-Qu'Appelle in terms of performing in a smart way and not in a big way.

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With these kinds of amendments in a thick piece of legislation, Canadians are going to find out maybe in a couple of months, if the government gets the legislation through and it is eventually proclaimed and the regulations are then written, what the seemingly small section of this large bill is going to mean to them.
I think they are going to be very disappointed and upset over this government's policies. We know that. They are upset about this government for many things, but this will come down the road to haunt this government. Unfortunately it will haunt Canadians at the same time.
While we are debating this legislation in the House today, and the other accompanying financial legislation, I wonder how many people are paying attention.
It is dry stuff sometimes. The member for Nickel Belt does his best to add some colour to this kind of legislation. Canadians must understand how important it is to understand just what the government is doing.
I would appeal to the members on the government side. A number of them have already commented about how they will be supporting some of the amendments of our colleague from Nickel Belt.
We would appeal to the Liberal Party to come to its senses and realize the importance of the amendment from my colleague so that we can ensure that Canadians are going to have the kind of financial services they need.
I would close with this comparison. It may be stretching it a bit, but I think it is appropriate. We have legislation that governs the use and abuse of social insurance numbers in Canada. Some people say it is not necessary or that the line is already drawn and it is not needed. However, I would say that we need those kinds of lines drawn because it is in the public interest. The public should know there are divisions of responsibility and should feel confident that at the very least our government and regulatory bodies understand those divisions. I think that is the basis behind the amendment being moved by my colleague from Nickel Belt. We hope that the members opposite will support it.


The Acting Speaker (Mr. DeBIois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBIois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBIois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBIois):: All those opposed will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBIois):: In my opinion the nays have it.
And more than five members having risen;


The Acting Speaker (Mr. DeBIois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.


John R. Rodriguez: Motion No. 11.
That Bill C-19 be amended by adding immediately after line 17 at
page 277 the following new clause:
"475. Notwithstanding anything in sections 468 to 474, no bank may acquire or increase a substantial investment in a body corporate
(a)	if the body corporate is an insurance bank to which Parts I to VII of the Canadian and British Insurance Companies Act apply or an insurance corporation incorporated by or under an Act of the legislature of a province; or
(b)	if the activities of the body corporate are substantially similar to those of a body corporate described in paragraph (a)."


The Acting Speaker (Mr. DeBIois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBIois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBIois):: All those opposed will please say nay.
November 26, 1991


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
And more than five members having risen


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 76(8), a recorded division on the motion stands deferred.


Catherine S. Callbeck: Motion No. 10.
That Bill C-19 be amended by adding immediately after line 43 at
page 260 the following new clause:
"459. (1) A bank must use plain language in all contracts related to financial services, applications for financial services and related documents which it provides to its customers who are natural persons.
(2)	Subsection (1) does not apply to words or forms of documents that are prescribed by law.
(3)	Subsection (1) does not apply to contracts, applications for financial services and related documents where the price of the financial service or the total liability assumed or to be assumed by the customer exceeds two hundred and fifty thousand dollars.
(4)	Proof that reasonable efforts have been made by the bank to comply and maintain compliance with subsection (1) is a complete defence (a) in a prosecution under subsection (1), or (6) in a dispute about whether subsection (1) has been complied with.
(5)	The failure of a bank to comply with subsection (1) does not affect the enforceability of any document referred to therein and may not be asserted by a customer or a company as a defence in an action or proceeding based on a document referred to in subsection (1).
(6)	As used in this section "customer" includes a natural person who is a guarantor or provides security to a bank.
(7)	Subsections (1), (2), (3), (4), (5) and (6) shall come into force on the day which is two years after the coming into force of section 1 of this Act."
She said: Mr. Speaker, this amendment is the same one that I proposed this morning to Bill C-4, the Trust and Loan Companies Act. It is an amendment which is called the plain language amendment. What it does is require the banks to put several documents in plain language, language that is written so that the reader can read it and understand it.
If you look at a lot of these documents, and I have some of them here, you can pick out any paragraph at all. For example: "To indemnify the insured or any other person who personally drives a temporary substitute automobile as defined in the general provisions of this
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policy against the liability imposed by law or assumed by the insurer such other person under any contract or agreement for direct and accidental physical loss or damage to such automobile and arising from the care, custody and control thereof". That is all one sentence and this goes on and on. I am sure we all have seen forms from financial institutions which are confusing. They are very difficult to understand. The sentences are extremely long and a lot of the wording is not in everyday language.
I wanted to acknowledge that certainly there has been some progress made in the industry with taking documents and putting them into everyday language.
Certainly I welcomed that trend but at the same time the industry can do more and certainly it acknowledges it itself.
I am proposing this amendment because I thing it is very important that it go into law.
This morning it was said that it is very difficult. It is a difficult thing to do, but it has been done. In the United States, at least 10 states have this in legislation. It was first in New York in 1978. In Alberta the same legislation went through in 1990.
If we look at the New York experience, the results are very impressive but the experts there say that in order to really get the industry to do that it must be put in legislation. That is why I am proposing this amendment today.
I believe it is a reasonable amendment because it gives the financial institutions two years to look through their documents and to put them in plain language. This amendment does not mean that they have to do it for every document. It is only required for small customers who are borrowing less than $250,000.
I have already spoken on this once today in the House but with those short remarks I certainly would urge all members in this House to support the amendment.


Donald Alex Blenkarn: Mr. Speaker, I suppose we all would like to make sure that all statutes we pass and all contracts we see drawn are written in plain language. The real question is what is plain language?
Let me read the amendment:

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"459.(1) A bank must use plain language in all contracts related to financial services, applications for financial services and related documents which it provides to its customers who are natural persons.
That is plain, is it not? Let us go on to the next one.
(3) Subsection (1) does not apply to contracts, applications for financial services and related documents where the price of the financial service or the total liability assumed or to be assumed by the customer exceeds two hundred and fifty thousand dollars.
That is plain too. We could go on. How plain do you want to get? The fact of the matter is that is not very plain to someone who has not got a university education. That is unfortunate, but a lot of the things that we do in law are not as plain as they might be. Perhaps we should be the people showing the example of how to write plain language amendments. Perhaps if the member for Mal-peque could write these amendments in plain language she would be able to show to the House the kind of thing that she would expect the banks to have.
Maybe and maybe not because the fact is that the contracts and rules and paperwork are done as simply as they can be done. No one takes great pleasure in convoluted language, least of all the people who write it because convoluted language is interpreted in law against the person who wrote the contract and if it is too convoluted they wind up losing their case.
The fact is they have to supply language that is interpretable and language that fulfils legal requirements and so we wind up with some things that we find pretty confusing and pretty complicated.
Unfortunately in many senses we live in a complicated society. While a number of institutions are attempting to draw their paperwork in a much more easily readable fashion, it is not always easy to do that. For the life of me I do not know how we would ever really set out a judgment system to determine whether something was written plain enough.
I suppose anyone who had a problem with a bank would go to court and say: "Well the documents are not plain enough", and then we would develop a whole host of further court precedents as to what is plain enough.
It think that is not going to be possible. I suggest that we leave the matter to the business community in order to be a little more plain. It ought to accept the urging from the member for Malpeque, my urging and the urging of the whole House that we wish contracts were
easier to read than some of them are. We would encourage people to write their contracts and documents in plain language.
Otherwise I do not believe we could have an amendment in this bill that would accomplish what we would like it to do in any fashion that would be of any great ease to those who enter contracts.


Simon Leendert de Jong: Mr. Speaker, we are quite sympathetic to the amendment though some of us wonder if it is something we can legislate per se into law.
I do not entirely agree with the member for Mississauga South. I suspect that those who draw up the contracts get perverse pleasure at times out of the special language they have developed.
After all, it goes back to very primitive times. Special languages get developed. For example, one does not get accepted into the priesthood until one has learned how to master the archaic language or forms of worships. By maintaining a very complex language and system upon which the contracts are drawn ensures those who have entered that priesthood, so to speak, will be limited to those who have gone through the necessary hoops and learning processes to understand what the archaic language is all about.
The hon. member from Mississauga was right when he pointed out how difficult the task is in terms of breaking through and getting things back into plain language. He quoted from sections of the amendment. Allow me to participate in that little feast. The second sentence in 459(1) reads:
A bank must use plain language in all contracts related to
financial services, applications for financial services and related
documents which it provides to its customers who are natural
persons.
Persons who read newspapers, magazines and so forth must sit back and wonder what it means by "natural persons". Are there unnatural persons to whom this does not apply? What are these unnatural persons about? I mean, away we go. What is a natural person?


An hon. member:: Is it the same as an ordinary Canadian?


Simon Leendert de Jong: It might be the same as an ordinary Canadian as opposed to an unordinary Canadian. Perhaps we might end up with some rules and regulations and some standards with which we can judge if a person
November 26, 1991

is an ordinary Canadian or whether a person is natural person.
That would indicate some of the problems we have in achieving a goal with which we will all agree. The language has to be simplified so that people can understand. Surely contracts can be put in a plainer language.
I sympathize with the Liberals on this. They recognize in their amendment that the larger the contract in terms of money value, most probably the larger number of different conditions and so forth. Therefore the more complicated it becomes. Contracts with a limit of the $250,000 require special effort in order to put such contracts into simpler terms.
I am not certain if it is entirely impossible. Fortunately the member from Mississauga seemed to suggest that it is. I know when we go through the process of tax reform that every time we try to simplify the tax forms they end up getting more complicated.
When we entered into tax reform in 1984-85 there was a great promise to simplify the forms. It seems to me that when I filled out my tax receipt last year there were more pages and more complications than there were before, even though the government keeps working on simplifying it. The more it tries to simplify it, the more complex it gets. Perhaps it might be the case as well when people really try to handle the task of simplifying contracts that we might end up in fact even getting into more complex contracts.
I agree with the members of the Liberal Party. You get this darned form from the bank when you are taking out a loan or you are a co-signer to something and the sentences go on and on and on, meandering around. One sentence can be a paragraph of several inches. It makes no sense. I think a case can and should be made that this indeed can well be a form of misrepresentation when something is presented in such complex language that an ordinary person-again we are back to an ordinary person-cannot really understand it. Then is it a fair contract? I think it is a good question that has to be raised.
While we will be supporting the amendment of the Liberal Party we are under no illusion, however, that by just putting this amendment in place if it passes it will have the immediate desired effect we all hope it would and should have.
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Mr. Ross Harvey (Edmonton East):: Mr. Speaker, I rise briefly to participate in the debate and state that my enthusiasm for this amendment perhaps exceeds that of my hon. friend from Regina. I have on a couple of occasions had the experience of going into a bank, or in my instance a credit union, and sitting down with the local branch manager and discussing the purchase of a car, most recently a truck, and having an amiable conversation across the desk in which the bank manager or the credit union manager was able in a matter of scant minutes to explain clearly and cogently precisely what the terms of the agreement were, precisely what the consequences of non-payment would be, and all this sort of stuff. It was absolutely clear, absolutely simple, absolutely comprehensible by me, and I do not have a university degree.
Then I get the contract to sign. My mom always told me: "Don't sign anything you haven't read". So I read it or try to read it but, my Lord, it is like reading something dredged up from an archaeological dig some place in southern Italy. It is incomprehensible. In fact my guess is that the credit union manger does not understand it. My guess is that the credit union's lawyer does not understand it. But there it is, and if I do not sign it I do not get the loan. I do not see what makes it so difficult to have a contract that reads like a credit union manager or a bank manager talks.
It is with considerable enthusiasm that I say that, granted on my own behalf but I think as well on behalf of those constituents of Edmonton East whom I here represent and whom I think have experiences with the banks that are much more often similar to that which I enjoy than perhaps are those enjoyed by the hon. member for Mississauga. By the way, you will have noted that he attempted to reinforce his point about the complication of the language in the proposed amendment by reading it at what could only be reasonably deemed break-neck speed. It is probably the same sort of thing that happens when one takes a reel-to-reel tape recorder and records someone speaking at three and three-quarters IPS and then play it back at seven and a half IPS. It was roughly that effect.
I congratulate the member on a most theatrical and effective effect, but it was not all that fair in terms of the point he was making. If I could go over that section again

November 26, 1991
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at a somewhat more reasonable speed, I think the point will be made. It reads in its entirety:
A bank must use plain language in all contracts related to financial
services, applications for financial services and related documents
which it provides to its customers who are natural persons.
Granted some folk might have a bit of difficulty with the idea of natural persons because it is true that many people in Canada do not understand that when the law speaks of persons it often, in fact usually, includes what are called corporate persons, which is to say incorporate businesses.
It is unfortunate that many people do not understand that. It is something that perhaps might be more fruitfully discussed and debated in a debate on our educational system some time. However, that is the case, so I warrant that in that one phrase there is perhaps cause for some modest confusion. But happily very rare will be individual Canadians, I pray, called upon actually ever to read this act. Happily most Canadians will only ever be called upon to read the contract for a loan on the desk of their local branch manager for their credit union or their bank. If in the passage of this amendment we are able to provide those fellow citizens of ours who must daily struggle through the accreted maze of bizarre phrases and wordings that regularly they are confronted with in especially financial legal contracts, then we will have done a service in this place that I should think most Canadians would applaud and celebrate.
Therefore I heartily commend to this House this amendment and I congratulate the hon. member on moving it.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: The question is on Motion No. 10.


Roger Simmons: The House is not ready for the question.


An hon. member:: Too late.


The Acting Speaker (Mr. DeBlois):: I really should not, but I am willing to recognize the hon. member for Burin-St. George's, for a few moments.


Roger Simmons: Mr. Speaker, what could be more instructive than to see the gentleman from Provencher, that exalted member of the cabinet, sitting in the very back-bench of this Chamber. How prophetic, how completely prophetic, especially if he and his gang keep bringing in the kind of nonsense legislation before us now. If they insist, I say to my friend from Ontario, on doing convoluted stuff, at least let my colleague and friend from Prince Edward Island make it partly intelligible, make it so that the people of Canada to whom these laws will apply have some opportunity to understand what the latest law is from this crowd.
Simplicity, Mr. Speaker. Suddenly we have to make the point for ordinary language. There are a lot more ordinary people out there, people whose claim to fame is not the $100 word or the $50 word, but people who live simply and by that we do not mean inadequately. There is nothing adequate about being complicated or convoluted. Some of the guys and girls on the other side might get their jollies out of being convoluted and complicated, but that of itself is not-


An hon. member:: Stop being partisan. We have a lot of decent bills here.


Roger Simmons: I say to my friend that we in turn are talking about a decent improvement to what he characterizes as a decent bill.


An hon. member:: Get some plain language.


Roger Simmons: He wants plain language.


An hon. member:: Get some plain language for the meeting in Aylmer.


Roger Simmons: The meeting in Aylmer?


An hon. member:: Yes.


Roger Simmons: I have to admit to my friend that I was not at the meeting in Aylmer. So I compensated, I went down and bought a few cans of Aylmer soup and I fed my yearnings that way. I then proceeded to cogitate, to have my own conference on the south coast of Newfoundland. We did it Sunday morning early, before church. We did it
November 26, 1991

by visiting a fish farm, me and the premier of the province, Mr. Wells, and his wife and the Minister of Forestry, Mr. Flight, and the Speaker of the House, Mr. Lush. So we had a conference, which we will call the Roti-as in R-O-T-I, a good French word with a good Newfoundland pronunciation-the Roti Bay Conference. I thought we had quite a number of ideas about how to put this country right.
But as my colleague knows, it is useless to have ideas about the Constitution or about anything else if somebody over there is not listening, as Mr. Wells has found out, as others have found out.
Mr. Speaker, as I was saying, Motion No. 10 was moved by my colleague from Prince Edward Island. She has done a phenomenal job, an absolutely phenomenal job on this particular legislation, an absolutely phenomenal job. In this particular instance she has moved, and we heartily support, that the bill before the House, Bill C-19, be amended by adding immediately after line 43, at page 260, the following new clause. I am not going to read it all because the first half dozen words say everything that needs to be said to make the point.
Motion No. 10 states, in part: "A bank must use plain language-". What a novel idea. You would think at first glance that the woman was simplistic, that she would even need to bring in that kind of amendment. What is it that prompts her, that makes it necessary to do so? Well, just read any of the documents that the bank shoves across the desk when they are looking for your signature in triplicate. Look at them, do not read them because you will get a headache and be none the wiser when you are finished. Finally, the bank manager or the assistant across the desk comes to your aid and says "Don't worry, it just says the following". Well, if he knows what it says, why does he not put it down in those words? Can they not find somewhere out there, a lawyer who can put in plain language for those people what it is they are committing themselves to when they make that transaction?
Can there be anybody? You know these people on that side of the House better than I do-I thank you for your indulgence and I am going to tie up the loose ends-you know those people a lot better than I do, can you tell me why anybody over there could possibly vote against a motion calling for plain language? I am sure they will not.
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The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


Some hon. members:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


Some hon. members:: On division.


The Acting Speaker (Mr. DeBlois):: I declare the motion lost on division.

Motion No. 10 negatived.


Gilles Loiselle: Motion No. 12.
That Bill C-19 be amended
(a)	by adding, immediately after line 32 on page 346, the following: 'Amendment to this Act if Bill C-34 is assented to
603. If, during the third session of the thirty-fourth Parliament, Bill C-34, entitled An Act to revise and amend the law governing cooperative credit associations and to provide for related and consequential matters is assented to, then, on the later of the coming into force of section 464 of this Act and section 1 of that Act, paragraph (e) of the definition "service corporation" in subsection 464(1) of this Act is repealed and the following substituted therefor:
(e) any other Canadian financial institution incorporated or formed by or under an Act of Parliament, or any central cooperative credit society to which the Superintendent has, by order under subsection 473(1) of the Cooperative Credit Associations Act, applied Part XVI of that Act, that has a substantial investment in the body corporate,";
(b)	by renumbering the subsequent clauses and any crossreferences thereto accordingly.


Donald Alex Blenkarn: Mr. Speaker, I think the amendment is a reasonable one. It is an effort to relate this bill to Bill C-34 which will be in this House very shortly. It is one of these amendments that we need in order to make sure that we keep the financial system together and one bill relating to the other. The reason for this particular amendment is to make sure that the banks operate in such a manner as to protect the situation for the co-operative credit associations.


Catherine S. Callbeck: Mr. Speaker, we have looked at the amendment and we do not have any problem with it.

November 26, 1991
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John R. Rodriguez: Mr. Speaker, we have no problems. When I see the member for Mississauga South starting to jump in his chair like a jellybean, I know he is looking at that clock and it is pushing up to
4.50.1	know he is anxious. I do not want him to drop out of his chair with apoplexy if this thing does not get done by 5 o'clock. We have no problems with it.


The Acting Speaker (Mr. DeBlois):: Is the House ready for the question?


An hon. member:: Question.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.
Motion No. 12 agreed to.


The Acting Speaker (Mr. DeBlois):: The House will now proceed to the taking of the deferred divisions at the report stage of the bill now before the House.


[Stage Direction]
Call in the members.

During the ringing of the bells:
The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 45(5)(a), I have been requested by the Whip's representative to defer the division until a later time.

Therefore, pursuant to Standing Order 45(5)(a), the recorded division on the question now before the House is deferred until six o'clock today, when the bells will be rung for no more than 15 minutes.


INSURANCE COMPANIES ACT
[Stage Direction]
The House proceeded to the consideration of Bill C-28, an act respecting insurance companies and fraternal benefit societies, as reported (with amendments) from the Standing Committee on Finance.

The Acting Speaker (Mr. DeBlois):: There are 59 notices of motions in amendment to Bill C-28, an act respecting insurance companies and fraternal benefit societies at report stage.
Motion No. A, standing in the name of the Minister of State for Finance will be debated and voted upon separately.

Motions Nos. B and 3B, standing in the Minister's name, will be grouped for debate but voted on separately-

Motion No. C standing in the name of the Minister of State for Finance will be debated and voted upon separately.

Motions Nos. 1, 6 and 7, standing in the name of the hon. member for Nickel Belt, will be grouped for debate but voted on as follows: (a) Motion No. 1 will be voted on separately; (b) The vote on Motion No. 6 will apply to Motion No. 7.

Motions Nos. 1A, 2A, 2B, 2C, 2D, 2E and 2F standing in the name of the Minister of State (Finance) will be grouped for debate, but voted upon as follows:
(a)	Motion Nos. 1A, 2A and 2F will be voted upon separately.
(b)	A vote on Motion No. 2A will apply to Motion No. 2C.
(c)	A vote on Motion No. 2B will apply to motion No. 2D.
Motions Nos. 2 and 8 standing in the name of the hon. member for Nickel Belt will not be selected in that they were both moved, debated and negatived in the Standing Committee on Finance which studied this bill at the committee stage.

Motion No. 2G, standing in the name of the Minister of State for Finance, will be debated and voted on separately. Motion No. 3, standing in the name of the hon. member for Nickel Belt, will be debated and voted on separately.

Motion No. 3A standing in the name of the Minister of State for Finance will be debated and voted upon separately.
November 26, 1991

Motions Nos. 3C and 3D standing in the minister's name will be grouped for debate with the vote on Motion No. 3C applying to Motion No. 3D.
Motions No. 3E, 5A, 5B, 1C, 9A, 10B, 11A and 11B, all standing in the name of the Minister of State for Finance are technical in nature and seek to amend the French and English versions of certain parts of the bill to ensure that both versions have the same meaning. They will be grouped for debate with a vote on Motion No. 3E applying to the remaining motions.

Motions Nos. 3F, 3H and 11D, standing in the name of the Minister of State for Finance, will be grouped for debate. The vote on Motion No. 3F will apply to Motions Nos. 3FI and 11D.

Motions Nos. 3G and 11C standing in the name of the hon. member for Nickel Belt will be debated together with the vote on Motion No. 3G applying to Motion No. 11C.

Motions Nos. 4, 5, 11 and 12, standing in the name of the hon. member for Malpeque, will be grouped for debate with the vote on Motion No. 4 applying to Motions Nos. 5, 11 and 12.

Motion No. 4A standing in the name of the Minister of State for Finance will be debated and voted upon separately.

Motions Nos. 5C and 11B.1, standing in the name of the Minister of State for Finance, will be debated together, with the vote on Motion No. 5C applying to Motion No. 11B.1.

Motion No. 6A standing in the name of the Minister of State for Finance will be debated and voted upon separately.
Motions Nos. 7A and 7B standing in the name of the Minister of State for Finance will be grouped for debate but voted upon separately.
Government Orders

Motions Nos. 7D and 7E, standing in the name of the Minister of State for Finance will be grouped for debate but voted on separately.

Motion No. 9 standing in the name of the hon. member for Malpeque will be debated and voted upon separately.

Motion No. 10, standing in the name of the hon. member for Nickel Belt, will be debated and voted on separately.

Motions Nos. 10A and 10C standing in the name of the Minister of State for Finance will be debated together but voted upon separately.

Motion No. 13, standing in the name of the Minister of State for Finance, will be debated and voted on separately-

Motions Nos. 14, 15, 16, 17, 18, 19, 20 and 21 standing in the name of the Minister of State for Finance are technical in nature seeking to harmonize Bill C-28 with the other financial institutions bills. The Chair proposes to group these motions for debate with a vote on Motion No. 14 applying to Motion No. 15, 16, 17, 18, 19, 20 and 21.
For the convenience of the House, I will recapitulate: Motions Nos. 2 and 8 will not be selected.

Motion No. A will be debated and voted on separately. [English]
Motions Nos. B and 3B are grouped for debate but will be voted upon separately.

Motion No. C will be debated and voted on separately.

November 26, 1991
Private Members' Business

Motions Nos. 1, 6 and 7 are grouped for debate. Motion No. 1 will be voted upon separately. A vote on Motion No. 6 applies to Motion No. 7.
Motions Nos. 1A, 2A, 2B, 2C, 2D, 2E and 2F are grouped for debate.
Motions Nos. 1A, 2A and 2F will be voted upon separately. A vote on Motion No. 2A will apply to Motion No. 2C. A vote on Motion No. 2B will apply to Motion No. 2D.

Motion No. 2G will be debated and voted on separately. Motion No. 3 will be debated and voted on separately.
Motion No. 3A will be debated and voted on separately-
Motions Nos. 3C and 3D will be grouped for debate with the vote on Motion No. 3C applying to Motion No. 3D.
Motions Nos. 3A, 5A, 5B, 7C, 9A, 10B, 11A and 11B will be grouped for debate with the vote on Motion No. 3A applying to the remaining motions.

Motions Nos. 3F, 3H and 11D will be grouped for debate. The vote on Motion No. 3F applies to Motions Nos. 3H and 11D.

Motions Nos. 3G and 11C will be grouped for debate with the vote on Motion No. 3G applying to Motion No. 11C.
Motions Nos. 4, 5, 11 and 12 will be grouped for debate. The vote on Motion No. 4 will apply to Motions No. 5, 11 and 12.

Motion No. 4A will be debated and voted on separately-

Motions Nos. 5C and 11B.1, standing in the name of the Minister of State for Finance, will debated together, with the vote on Motion No. 5C applying to Motion No. 11B.1.

Motion No. 6A will be debated and voted on separately. Motions Nos. 7 A and 7B will be grouped for debate but voted on separately.

Motion Nos. 7D and 7A will be grouped for debate but voted on separately.
Motion No. 9 will be debated and voted on separately.
Motion No. 10 will be debated and voted on separately-

Motions Nos. 10A and 10C will be grouped for debate but voted on separately. Motion No. 13 will be debated and voted on separately.

Motions Nos. 14 to 21 inclusive will be grouped for debate with the vote on Motion No. 14 applying to the remaining motions.

It being 5 p.m, pursuant to Standing Order 30(6), the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS' BUSINESS


Hon. Alan Redway (Don Valley East) moved: that Bill C-280, an act to amend the Canada Pension Plan Act (disability pension), be read the second time and referred to Legislative Committee F.
He said: Mr. Speaker, I am very pleased that at long last I am giving the House an opportunity to correct what I believe is a gross injustice in the law, an injustice
November 26, 1991

specifically with respect to the Canada Pension Plan disability pensions.
This Bill C-280 will change the limitation period for the Canada Pension Plan disability pension for someone who has not yet reached the age of 65.
This particular bill does not deal in any way with the Canada Pension Plan retirement pension nor with the Canada Pension Plan survivor benefits, nor with the orphan benefits under the Canada Pension Plan, nor with the death benefits under the Canada Pension Plan. It does not conflict in any way with Bill C-39 which the government has currently before this House.
This bill deals with the limitation period in the Canada Pension Plan disability pension.
Presently, the Canada Pension Plan disability pension provides that in order to qualify for such a pension a disabled person must have made contributions in at least two of the last three calendar years that are included in the contributory period plus having made contributions in five of the last 10 calendar years that are included in the contributory period. The contributoiy period is defined as beginning for someone my age, not your age, on January 1, 1966. For someone your age it was at the age of 18 and running until the age of 65 or 70 or until such person receives a retirement pension.
If a disabled person has not made those contributions and does not qualify in that way then that person is barred by the current limitation period from receiving a disability pension, even though they may have made contributions for many, many years to the Canada Pension Plan.
Bill C-280, this bill that is before the House, would change that limitation period so that a person who has made contributions for at least one-third of the contributory period is eligible to receive a Canada Pension Plan disability pension. The bill is aimed at rectifying what I believe is a most distressing problem and a real injustice which applies in many cases. An example may be where a disabled person really did not have any knowledge of the fact that there were rights of applying for a disability pension, cases in which the disabled person did not want to admit to themselves or their family that they were actually disabled or cases where perhaps they did not want to be a burden on the fund or on society and did not
Private Members' Business
want to actually apply for the pension because they had enough money at the time.
Later on when their disability became worse perhaps, when their financial position became worse or when they learned about the plan itself, then it was too late to make this sort of application. The current limitation period in the Canada Pension Plan for disability pensions bars people from making that application.
I have many cases. I suspect you may not, Mr. Speaker, because the Quebec Pension Plan actually has a provision similar to the one in this bill already and has for a number of years, but the Canada Pension Plan does not. This situation however first came to my attention when I wanted to run for Parliament, back prior to the 1984 election. I was out knocking on doors in my constituency in the years 1982-83 and I knocked on a door in Victoria village, a portion of my riding, the home of a Mr. Carl Stoyanoff and his family.
Mr. Stoyanoff had been diagnosed with Parkinson's Disease back in 1972 at the age of 48. He continued to work until 1976 hoping that some sort of new medication or some new therapy might come along that would return him to 100 per cent health. He was not aware of the Canada Pension Plan disability pension at that time. He was not aware of it at all. When he found out about it and made his application for the pension, it turned out that he was just a few months past the deadline for the limitation period in the Canada Pension Plan.
This is a man who had contributed for years and years to the Canada Pension Plan. He is supposed to be entitled to a disability pension and he is barred from it because of this late application.
I made representations on his behalf. We went through all the bureaucratic steps. We appealed to the minister and nothing worked. In 1987 Mr. Stoyanoff was still not receiving a Canada Pension Plan disability pension and applied for an early retirement pension at the age of 60.
Since he had never received a disability pension, his contributory period continued to run on and there was a period of some 11 years of disability, including four years of hospitalization, which went completely unrecognized by the current rules of the Canada Pension Plan. Thus Mr. Stoyanoff received a very reduced retirement pen-

November 26, 1991
Private Members' Business
sion, not to mention the fact that he received no disability pension either.
After his death a year later in 1988, his widow, Mrs. Stoyanoff was denied survivor benefits even though Mr. Stoyanoff had made contributions in seven consecutive years during his contributory period.
Finally there is somewhat of a happy ending in that Mrs. Stoyanoff, after appealing several times in 1991, was granted a survivor's pension and a death benefit.
That was by sheer luck and does not correct the problem which this bill aims to address. That is only one of many, many problems that have come to my attention and I suspect as we look around the Chamber, almost everyone has had problems of this particular kind.
I have had a number of cases, including the case of Max Crittendon, who was a reporter and writer for the Toronto Star, the Toronto Telegram, the Toronto Sun, who developed multiple sclerosis and he too was barred from receiving a disability pension under the Canada Pension Plan because of a late application. He did not want to admit to himself that he was actually disabled.
Albert Culver had the same problem; Kalyopi Hilepo, the same problem; Lucille Recupero, the same problem; Mrs. Isabella Ross, the same problem; Catherine Belanger, the same problem; Sam Allen, the same problem. Those are just a few of the cases I have come across in my own constituency over the last few years. As I say, I am sure that around this Chamber, almost everyone- perhaps with the exception of the members of Parliament from Quebec, where the Quebec Pension Plan has similar provisions already- has had these kinds of problems.
Since my election to Parliament in 19841 have pursued all of these cases with the department. The minister was involved and I have always received a very sympathetic hearing. The bureaucrats say they would love to give this person their disability pension, but their hands are tied. They told me there was this legislation there in black and white. They could not do anything, and please get it changed.
In 19851 went to the then Minister of National Health and Welfare, the present Minister of Energy, Mines and Resources, and we discussed this matter in great detail.
He agreed that this was an injustice and that it should be changed. He said the government would make sure it was changed in the next round. You may recall that there was a bill to amend the Canada Pension Plan in 1985 that was to take effect on January 1, 1986, but that was already in the works, much as Bill C-39 is now, so the minister said it could not make any changes at that time. He said it would have to make them in the next round. However, the next round he said was going to be the next year and that they would make those changes in 1986, effective 1987.
I worked with his legislative assistant, Michael Hatfield, at the time and Michael Hatfield in fact drafted the very wording that is in the bill that is before the House tonight. It was his wording and his suggestion as to how to amend this bill, the then legislative assistant to the Minister of National Health and Welfare, the present energy minister.
As you know there was no next round before the 1988 election. In January 1989 we had a new Minister of National Health and Welfare, and lo and behold when I started to make inquiries of the department and the minister, they could find no record whatsoever of my discussions, my correspondence, of Michael Hatfield's letter to me, nothing at all, although I have it here and I can table it if you wish. However, the department has no record whatsoever of that correspondence or of those discussions.
They said, of course, that in the next round they would look after these things. Well, here we are with another new minister and we have another new round, Bill C-39. It is still not in that new round and it is still not in that new bill. We still have not solved the problem.
When I first tabled the bill that is before the House tonight, Bill C-280, and it received first reading, I was contacted by the office of the Minister of National Health and Welfare. Someone said I was right, this was a terrible situation, it should be changed and maybe they would include it in the next round.
The next round was supposed to be in 1986. We are now at 1991. That is something like five years later and we are having the next round now. Lord knows how many years it is going to be down the line for the next round again, how many ministers will have been changed in the meantime, and how many departmental and
November 26, 1991

ministerial staffs will say they cannot find any record of the correspondence, discussions or whatever. In addition, as you will be aware, after Bill C-280 received its first reading, it went to the private members' draw. It was drawn and went to the private members' business committee. They agreed that it should be votable, but then it went to the House management committee. I believe they acted on the mistaken belief that this bill could not be passed without prior consent of the provinces, and decided that it would not be votable.
A few days after that, I met with the minister's staff and with the department staff and they told me there was no need to get the provinces' approval in advance. This bill could be passed, it just would not take effect until the provinces agreed. If the provinces never agreed, then it would never take effect.
That makes a lot of sense to me. If there were any concerns about problems with federal-provincial relations, surely the government could always say this is a private member's initiative and has nothing to do with the government. If you do not like it you cannot blame us because it is that rotten Redway who has introduced this bill, not us in the government.
Whatever it is, as I stand here in front of you today, this bill is not votable because it was turned down by the House management committee. Apparently we are going to go on year after year after year, one Mr. Stoyanoff after another. Dozens and hundreds and thousands perhaps of disabled people are not going to be able to get the benefit of the contributions they have made because apparently their contributions are now going to subsidize somebody else's pension under the provisions of the bill as it now stands.
It seems to me this is a real injustice. There is a way to correct it and there is a way to correct it tonight.
Robert Kennedy used to say: "Some men see things as they are and say why, but I dream dreams that never were and say why not?" Tonight we have a chance collectively, as members of Parliament representing Canadians, to say: "Why is this injustice happening? It is too bad we cannot do anything about it". Or we can say: "There is something we can do about it, why not do something about it". Pourquoi pas? Let us do something about it tonight.
With that in mind, I would like to seek the unanimous consent of the House to adopt the following motion:
Private Members' Business
That notwithstanding any standing orders and usual practices of the House, Bill C-280, an act to amend the Canada Pension Plan Act disability pension, be referred after second reading to a Committee of the Whole instead of to the Legislative Committee F; and that, unless otherwise disposed of, no later than at the end of the time provided for the consideration of Private Members' Business today, any proceedings then before the House shall be interrupted and every question necessary to dispose of the said bill at all stages should be put forthwith and successively without further debate or amendment.


The Acting Speaker (Mr. DeBlois):: The House has heard the motion tabled by the hon. member. Is there unanimous consent?


Some hon. members:: Agreed.
Motion (Mr. Redway) agreed to.


Mr. Dennis Mills (Broadview-Greenwood):: Mr. Speaker, with the consent of the House, I would like to share my time with the critic for health and welfare.


The Acting Speaker (Mr. DeBlois):: Is there unanimous consent that the opposition splits its time into two speeches?


Some hon. members:: Agreed.


The Acting Speaker (Mr. DeBlois):: For five minutes the hon. member for Broadview-Greenwood.


Dennis Joseph Mills: Mr. Speaker, I would first of all like to salute the member for Don Valley East for this initiative. The member for Don Valley East and I share the community of East York together in downtown Toronto and the member is constantly working for his constituents. The Private Members' Business before us today is just another example of the member going out of his way to make sure that the best interests of his constituents are represented.
On the issue of disability pensions, the hon. member and I have shared many cases in our community where the red tape and technicalities so often cause deep pain for the people directly involved, their families and children. The member for Don Valley East is to be complimented again for this fabulous initiative.
I know in my own riding I have a case with the Baxevanis family where Mr. Baxevanis was helping his neighbours build their home. He was a craftsman carpenter and fell off the roof and broke his leg and hip in about 25 different places. For three years, because of the

November 26, 1991
Private Members' Business
technical difficulties within the Department of National Health and Welfare, the man has been without support.
This is the kind of amendment that will hopefully cause the Department of National Health and Welfare to be just a little more sensitive to the real condition that exists out there. When someone in our community ends up totally disabled, his wife and family sit without any income and have to ultimately resort to welfare.
I want to say to my neighbour, the member for Don Valley East, good work. I thank you for having this opportunity.


Mr. Rey Pagtakhan (Winnipeg North):: Mr. Speaker, thank you for the opportunity to speak today on Bill C-280, an act to amend the Canada Pension Plan Act respecting disability pension benefits. It is a bill long overdue, but doomed to impotency by this government over the past several years.
I therefore salute the member for Don Valley East for having the commitment, the courage and the conscience to buck the opponents of this bill in the past, particularly those from within his own political party. Those detractors must have clicked their heels for joy when Bill C-280 was deemed non-votable.
Although we must not overlook the role of the departmental bureaucracy in hindering this bill, I must admit that it would never be a stumbling block if the minister were to muster the will to effect a change. Has the meaning of ministerial responsibility been forgotten, I ask.
Allow me to reflect at this juncture on my disappointment at the decision to make this bill non-votable initially. I think we have found some remedy today. To have made this bill non-votable, if we had insisted on that and not referred it to the committee, would have made a mockery of Parliament. It would have made a mockery because a non-votable bill would seem to have passed judgment that the bill would never see the light of day. In a sense it would truly have curtailed the privileges and rights of members of Parliament.
The member for Don Valley East has tried for six years to help those denied their rightful CPP benefits. I share that sentiment. The wrongs looked as though they would
be righted before the 1988 election when he received the co-operation of the former minister of health, then the member for Provencher in my home province of Manitoba, but the issue has since been buried by subsequent ministers of health.
The perfect opportunity occurred on October 24 when this government through its present minister tabled in this House Bill C-39.
Nowhere in this legislation was there any mention of waiving the application deadline for disability benefits. In fact the deadline was tightened from one year to 90 days.
I believe the deadline for CPP applications should be irrelevant, as long as the claimant has medical certification to prove he is eligible for disability benefits and can show he meets the minimum contribution requirements as required by the act.
I am furious that this bill was hamstrung by people who cannot see the pain of those who fell through the cracks of the Canada Pension Plan bureaucracy.
Every member of Parliament in this House has constituents who have fallen through the cracks. For whatever reason, these workers had hoped their disability would disappear, and therefore did not file sooner.
They believe in a work ethic. Some were able financially to weather the initial phase of disability. It therefore came as a surprise to most of them when the disability became an unavoidable reality and when they found they were late. They were told they no longer had the benefits.
I believe people who have paid into the Canada Pension Plan have developed an inherent right to that plan. Is it not penalty enough to be disabled and lose your job, without suffering the added injustice of being denied your right to disability benefits?
Instead of denying benefits to disabled people, this government should spend time managing the Canada Pension Plan better so that we can get the greatest financial returns, and thereby return better benefits to Canadian citizens.
I would have liked to revisit the debate on Bill C-39.1 would like to be short in this debate, but I would like to indicate that indeed I am pleased that this bill is now before us.
November 26, 1991

For once, parliamentarians are again challenged to show their social conscience, to come to the needs of those people who need our help, the disabled. This fiction of a deadline is indeed a fiction. It should not extinguish any claim to inherent rights to benefits for which they have paid in the past as members of the working force.
On that note I thank you for the opportunity. I thank the member for Don Valley East for the determination, the commitment and the courage with which he pursued his private member's bill.


Mr. Sid Parker (Kootenay East):: Mr. Speaker, I, too, would like to congratulate the hon. member for Don Valley East for introducing a private members' bill which has an effect of making CPP disability more accessible to those Canadians in need.
I congratulate the member for getting the full consent of the House on his motion.
I have spent a great deal of time and energy on issues and cases dealing with CPP disability, both in my role as my Party's pension critic and as the member of Parliament serving the needs of my constituents in Kootenay East.
The current poor state of the public disability pensions is an issue that all members of this House have had to deal with. It is truly a non-partisan issue.
I am happy to support a bill which promises to expand access to benefits for Canadians with disabilities. At the same time, I am sure that my colleague would agree that there are other areas of CPP disability that desperately need to be addressed by this House.
Notwithstanding recent efforts by this government, I think that we can all agree that the current legislation covering CPP disability is flawed.
I would like to take a few moments to identify a number of other areas which demand immediate action. The very definition of the term "disability" contained in existing legislation excludes thousands of Canadians who have legitimate and serious disabilities.
Under existing legislation a person who is unable to work due to a disability does not necessarily qualify for disability assistance. Disabled Canadians who seek independence and dignity through retraining and education
Private Members' Business
risk their disability benefits because existing legislation says that a legitimate disability is one which prohibits any initiative whatsoever.
It is outrageous both in financial and moral terms that Canada's public disability pension scheme does not recognize the importance of retraining and education.
The same logic applies to part-time work. The current legislation forbids even the most part time of work. Part-time work can be the first step for a Canadian with a disability to eventually re-enter the work force.
Should we say to Canadians who make these initial efforts that they are putting their financial security at risk? Of course not. What we need are more incentives, not less.
Bill C-280 addresses the question of accessibility and there are a number of other areas that also need to be looked at.
Under existing legislation a person who does not apply for CPP disability within the first 15 months is ineligible.
I have seen first hand people who have been excluded for this ridiculous regulation. Privately most public servants who deal in this area will tell you that the information flow from CPP to Canadians with recent disabilities is veiy poor. People do not understand what is available to them. In many cases people simply do not know that CPP disability is there.
The problem is no doubt worse for people with low literacy skills or new Canadians whose first language is neither English nor French. In other cases people receive initial disability coverage from other sources and then find out that they can no longer get CPP coverage.
It only makes sense that if persons become disabled on a certain date and are documented and verified they should qualify for disability pension. The 15-month limit clearly needs to be removed.
I could go on and on, but I hope that I have made my point. I applaud the hon. member for his efforts to bring about the change, and I hope that we can all work together to improve our disability pension plan.
In our discussions in committee on the changes with regard to Bill C-39, which we have just reported back to the House and will be debating very shortly, we had witnesses come before us. I wish every member of Parliament could hear the stories and the problems that are out there regarding our Canada Pension Plan, the

November 26, 1991
Private Members' Business
disability portions of that plan and the provisions that many people who have paid their money into it are being denied simply because of poor information and poor legislation.
The Canada Pension Plan needs to be revised and this is the first step. The hon. member has identified one area but we must as parliamentarians look at the whole Canada Pension Plan and look to the future so that people are covered and not denied the benefits that should be made available to them.
I congratulate the hon. member for Don Valley East on a job well done.


Mr. Wilson (Swift Current-Maple Creek-Assini-boia):: Mr. Speaker, I wonder if I might first have the consent of the House to share this time slot with the member for Calgary South.


The Acting Speaker (Mr. DeBlois):: Is there unanimous consent to give the floor to the next speaker for the government side?


Some hon. members:: Agreed.


Geoff Wilson: Mr. Speaker, I would like to speak in favour of the intent of this motion and in favour of any measures which can be taken to improve the plight of those disabled Canadians who having contributed into the Canada Pension Plan through their employment subsequently became disabled, had to leave their employment as a result of the disability and are presently excluded from receiving any benefits simply because they did not apply in time for the pension. Anything that can be done to ameliorate the situation is to be commended.
I believe it is grossly unfair that through the passage of time people who would otherwise have qualified for a disability pension having contributed to the fund are denied. I think this point was made in debate on Bill C-39 and has been made on numerous occasions over the last number of years in this House by myself and others. I believe it is a situation that cries out for redress.
Last night in committee proceedings there was an indication of support from all sides of the House for this process. It may well require federal-provincial agreement. I believe the intent of this motion will result, if members agree, in the passage of the bill. It can go on to
the Senate and ultimately then will be on the table and will require the agreement of participating provinces.
What it does is put the subject matter on the federal-provincial table, something that has been promised in this place and to date has not happened. Therefore I want to place myself firmly on record as being in favour of this motion.
I would like to turn over the balance of this time period to my hon. colleague for Calgary Southwest.


Mrs. Barbara Sparrow (Calgary Southwest):: Mr. Speaker, I too am pleased to take part in this debate on Bill C-280 as has been put forth by the hon. member for Don Valley East. The main thrust is that the CPP disability benefit would be payable to disabled persons who had contributed to at least one-third of their contributory years, with a minimum of five years of contribution.
There are two or three things I would like to draw to the attention of the House prior to taking the vote. One thing is that a major change such as this one, because it is going to be a monetary cost to the fund, is going to require two-thirds of the provinces with two-thirds of the population agreeing. If this passes and the provinces do not agree with this, it means the end of the bill.
Also, if this goes through and we get two-thirds of the provinces with two-thirds of the population, perhaps the earliest it could come in would be January 1, 1994. That is roughly two years and a month from today.
The minister has spoken with the hon. member for Don Valley East and has certainly heard his concerns and understands exactly what he wishes with regard to the disabled. He also has given my colleague his word that he would review this situation in the spring of 1992 with regard to amending CPP. I hope the hon. member is listening. If this is done, we would be able to improve the benefits to the CPP people who had missed applying for the disability because they were either not knowledgeable or did not realize the situation. We would certainly get the bill amended much faster.
We have a choice of two ways of looking at this. If Bill C-280 is approved, it could not possibly be implemented before January 1, 1994 or it could be absolutely not agreed upon by the provinces.
November 26, 1991

The other side is, as I said to the hon. member, that the minister has promised he would take his concerns and review them at the spring meeting with his counterparts from the provinces with regard to the period for disabled period and would address the need.
In conclusion and before we come to any vote I want all of us to be aware that we stand a chance of losing it completely. If we do get it, it cannot be implemented until January 1, 1994.1 agree with this bill in principle. I know the minister will take this concern to his colleagues and we could get it through this House in the year 1992 and have it enacted at least a year earlier.
While we all agree in principle with what the member has stated I think we have to weigh the pros and cons very carefully. The minister did give his word to the member and maybe that is the route we should take. It is going to be up to each and every one of us here to decide exactly how to treat this bill.


Sidney James Parker: Mr. Speaker, I was under the impression that there would not be a vote. I thought the motion had passed, it was agreed upon and the motion was accepted by the House.


The Acting Speaker (Mr. DeBlois):: I remind all members that the motion was carried by unanimous consent. Mr. Redway moved that:
Notwithstanding any Standing Order or usual practice of the House, Bill C-280, an act to amend the Canada Pension Plan, be referred at second reading to a Committee of the Whole instead of the legislative committee and that, unless otherwise disposed of no later than at the end of the time provided for the consideration of Private Members' Business today, any proceeding then before the House shall be interrupted and every question necessary to dispose of the said bill at all stages shall be put forthwith and successively without further debate or amendment.
That is the motion that the House carried by unanimous consent earlier this afternoon.


Mr. Ronald J. Duhamel (St. Boniface):: Mr. Speaker, I wanted to address this particular initiative by my colleague for Don Valley East, which I find extremely laudable.
Removing the deadline for the applications for disability pensions I think is something that should have occurred a long time ago. Let us remember that these are people who have suffered. Very often there is an accident involved or another serious setback. I cannot
Private Members' Business
understand at all why one would not simply concede immediately that anyone who has gone through that kind of trauma should have to adhere to a particular deadline. There are situations in which people are left alone without appropriate support, or they are particularly and totally consumed by what has occurred to them that it is simply not possible for them to know the rules and regulations or to be informed of those rules and regulations.
I think this is an absolutely meaningful and progressive initiative.

I fully applaud it. I also wish we could look at other opportunities for responding to the needs of Canadian men and women, as this bill will do if it is allowed to proceed.

I would hope as well that during the process of debate today and at other appropriate times we might look to see where we could extend deadlines and look at retroactivity. I think the same principle is involved here: Should a Canadian be penalized because he or she who qualified for a particular government program did not apply at a particular time?
What are the reasons? Very often they do not know that it exists or they are particularly taken by the situation they are involved in that they do not have the time or the information or have no way of finding out and so on.
Let me give just three very brief incidents that I have experienced since becoming a member of Parliament just a little longer than three years ago. There is a disabled person in my constituency who did not know that as a result of an accident he could qualify. This was not a person who was illiterate. This was a person you would find every day in your constituency as you meet the men and women who are there. One day, because of a discussion he had with a member of the family, he thought there might be a possibility and because it was brought to his attention too late after the accident he no longer qualified. I think this was a tremendous injustice.
There is another incident in which I believe a person should qualify for disability.
Because of serious emotional problems this person is unable to function adequately. We ought to be looking at that dimension as well, at the definition of what a severe

November 26, 1991
Private Members' Business
disability is and what prolonged incapacity is because therein lie a lot of problems too. If one looks at the appeals that are undertaken in these two domains one can see the tremendous waste of money and time because there are no precise definitions in those particular areas.
Those are but a few examples. Previously I indicated that the whole notion of deadline, the whole idea of retroactivity, should be examined for other government programs to which Canadians qualify.
I want to tell you about a widow of a veteran who raised by herself five children without two pensions, two programs to which she was entitled. She did not know that they existed. There were extenuating circumstances, but she did not know. In that process she had to sell her home and she had to sacrifice a great deal to raise those children.
Today she is asking for some allowance so that one of her children can go on and get further training. To date she has not been successful but I am still hopeful that the Minister of Veterans Affairs will see it as a possibility to assist financially this woman and her son so that he can get the type of training that will permit him to earn the kind of living to which he is entitled, that which he might have received if he had been informed in time.
Let me give one final example. There is a senior who is 81 years old whom I have met. I have mentioned his case in this House before. He had just found out that he was entitled to a particular government assistance program because of his level of income. He had been eking out a bare living, not living appropriately at all. When he went back the retroactivity was 14 months. It was very, very little. I find it unconscionable that it should be so short. I have a question on the Order Paper that asks government to indicate to Canadians just how much money it has saved as a result of not paying all of these funds that would normally be paid if people applied on time if they were familiar with the programs that are available to them.
There is an indication from one of my colleagues from government that we need a certain number of provinces to approve this particular initiative if it were to go through. I would hope that no one would question the necessity of this initiative and that they would not find
excuses and hide behind financial barriers. If this were the case we could do it for every single initiative that's ever been undertaken.
I would like to complete my remarks by saying if we truly believe that this is a wrong which is being corrected, let us not hesitate. In order to correct this situation let us do what is necessary without jumping through unnecessary hoops and hurdles.

Mr. Speaker, I want to thank you for giving me a chance to say a few words on this subject. This is a very welcome initiative. It is an incredible opportunity to correct a situation that is most unfair. I hope that we will be able to proceed with this legislation and that we will also be able to explore ways of correcting the situation in other programs, to make them fairer.


Marcel R. Tremblay: Mr. Speaker, I am pleased to participate in this debate on Bill C-280, a private member's bill which was introduced by the hon. member for Don Valley East. The bill, which was given first reading in the House of Commons on September 20, 1991, proposes some amendments to the Canada Pension Plan.
Under Bill C-280, a CPP disability benefit would be payable to disabled persons who had contributed in at least one third of their contributory years, with a minimum of five years of contributions. At the moment, in order to receive a disability benefit under the CPP, a contributor must, at the time of disablement, have contributed to the Plan in five of the last ten years or, alternatively, in at least two of the last three years. The hon. member's proposal, in effect, provides a third option. The purpose of the bill, then, is to extend the time that one is eligible for benefits.
There is no doubt that one of the major problems facing the disabled is inadequate income support. Despite the many programs to assist disabled persons, this group remains among the poorest in Canada. I think that it is obvious-and commendable-that the bill before us today is seeking one more way to alleviate this situation.
November 26, 1991

The hon. member has identified the Canada Pension Plan disability provisions as being in need of improvement. His criticism, however, is not with the level of benefit or the definition of disability-the two areas most commonly looked at with regard to CPP disability benefits.
Instead, he is asking the government to modify the eligibility criteria that require a disabled CPP contributor to meet minimum contributory requirements. Even though this change may seem of minor significance at first glance, there is no doubt that it could improve the financial situation of at least some disabled persons.
Since the introduction of the CPP in 1966, the minimum contributory requirements have come in for criticism and proposals have been made for change. Indeed, changes have been made. Perhaps I could just take a few minutes to review the changes which were made to the CPP in 1986, as they affect disabled contributors.
As of January 1, 1987, the flat-rate benefit portion of the disability pension was increased by approximately $150 per month. The eamings-related portion of the CPP disability pension remained at 75 per cent of the disabled contributor's imputed retirement pension. This, together with the higher flat-rate benefit, increased the maximum disability payment from $415 to $565 per month at 1986 rates.
It should be noted that today, in 1991, the maximum disability benefit is almost $745 per month, including the flat-rate portion of $290. At the same time, directly related to the proposed change before us today, we have the 1986 amendment to relax the contributory requirement rules.
Workers who become disabled now qualify for benefits if they have contributed to the Plan during two of the three years preceding their disablement. This affords early protection in case of disability for young people and for those persons, particularly women, who are re-entering the labour market.
The existing requirement of contributions in five of the last ten years was retained since it provides continued protection against disability for several years after an individual has ceased contributing to the Plan.
Moreover, this period of continued protection against the loss of earnings due to disability was further pro-
Private Members' Business
longed by the extension of the retroactive period. As of January 1, 1987, disability may be determined to have arisen up to 15 months prior to the month of application for benefits. I think it is useful to note that many Canadians now benefit from the CPP disability provisions.
In 1991, approximately 215,000 disabled contributors and 73,000 children of disabled contributors are receiving CPP benefits. They receive total monthly benefit payments of about $160 million. While there is no question that this does not meet the total income needs of the disabled and their children, I think we can all agree that it is a significant contribution, particularly in these difficult economic times.
As for meeting the income needs of the disabled, it must be recognized that the CPP is a social insurance program for Canadian workers. It is related to earnings and like all eamings-related disability plans, a minimum qualifying period has been a requirement since the inception of the Plan in 1966. A look back at the discussions surrounding the development of the CPP makes it clear that no other benefit posed as many problems or raised as many questions as did the disability provisions. The federal and provincial governments wanted fairly rigorous benefit eligibility rules until some experience had been gained under the new plan. Experience has shown that the original requirements needed to be eased and as we have just seen, this has been done. While the Canada Pension Plan is not intended to provide all the income a disabled contributor may need, there are certainly ways to improve the protection the CPP offers.
I am sure that hon. members will agree with me that Bill C-39, which we debated just last week and agreed to, is ample evidence that the CPP is a dynamic program. The changes which are about to be implemented as a result of this recent amendment to the Plan will ensure the long-term financial stability of the CPP and provide an additional $35 a month to the children of disabled and deceased contributors.
A number of other minor amendments will also be made. While some simply clarify the legislation and simplify its application, others will allow benefits to be paid where eligibility does not currently exist.

November 26, 1991
Business of the House
I will not reiterate the details of that bill, since we are all familiar with them, having so recently examined them in this House. However, I would like to mention in passing the protection afforded to those who are incapacitated and cannot act on their own behalf.
In the past, such persons have lost several months of benefits or even total eligibility because they were unable to apply on time. The Minister of National Health and Welfare will now be able to treat an application for any CPP benefit as if it had been made at the time that the person became incapacitated. While this may not affect a large number of people, I believe that it is very important in terms of the basic intention and spirit of the Plan.
With regard to Bill C-280, notwithstanding what was discussed and approved in the House a few minutes ago, I still feel that the hon. member has put forward for our consideration a very valid proposal. There is no doubt that this would benefit some disabled contributors who do not now meet the eligibility requirements. However, I also believe that we must pause and assure ourselves that we are not making a fundamental change in the philosophy of the Plan with respect to relationship to earnings and the recency of those earnings.
Therefore, while I support this proposal in principle, I do believe that it needs further reflection. We must also recognize that federal and provincial legislators do not amend the CPP in haste. A change which affects funding, such as this one, would require the approval of two thirds of the provinces having two thirds of the Canadian population, as well as the approval of Parliament. I am very pleased that the Minister has undertaken to bring this proposal to the attention of the provinces and to put it on the agenda of the next federal-provincial meeting on the Canada Pension Plan, which should take place in the coming months.
In closing, I would like to thank the hon. member for Don Valley East for providing this opportunity to discuss the question of CPP disability benefits. This motion and the debate on it give us the opportunity to consider issues which are fundamental to the disability provisions of the Plan.


BUSINESS OF THE HOUSE
Albert Glen Cooper: Mr. Speaker, there have been discussions among the parties and I believe you will find unanimous consent for the following motion:
That when the House undertakes third reading debate on Bill C-4, an act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters, it shall be deemed that all bills, part of a financial institutions package, namely Bill C-19, an act respecting banks and banking; Bill C-28, an act respecting insurance companies and fraternal benefit societies; and Bill C-34, an act to revise and amend the law governing co-operative credit associations and to provide for related and consequential matters; be called jointly with Bill C-4 for third reading debate;
That Standing Order 11(2) be suspended for the duration of the debate at third reading;
That the debate be held concurrently on the subject matter covered in the four said bills;
That, immediately after Bill C-4 has been disposed of, the Speaker shall put forthwith and successively, without further debate or amendments, all questions to dispose of Bill C-19, Bill C-28 and Bill C-34 at third reading in that order.


David Charles Dingwall: Mr. Speaker, there have been discussions among House leaders with regard to the contents of this motion. We find it in accordance with what we have agreed to.


John R. Rodriguez: Mr. Speaker, the NDP caucus has no problem with this motion.
We have been very co-operative in the study of these bills at second reading and at report stage and will continue to do so.


The Acting Speaker (Mr. DeBlois):: The House has heard the terms of the motion tabled by the hon. parliamentary secretary. Is there unanimous consent to adopt the motion?
Some hon members: Agreed.
Motion (Mr. Cooper) agreed to.
November 26, 1991




[Stage Direction]
The House resumed consideration of motion of Mr. Redway that Bill C-280, an act to amend the Canada Pension Plan Act (disability pension), be read a second time and, by unanimous consent, referred to Committee of the Whole.
The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those in favour of the motion will please say yea.


Some hon. members:: Yea.


The Acting Speaker (Mr. DeBlois):: All those opposed to the motion will please say nay.


Some hon. members:: Nay.


The Acting Speaker (Mr. DeBlois):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. DeBlois):: Call in the members.
Before the taking of the vote:


Alfonso Gagliano: Mr. Speaker, I believe that since this is a private members' bill, you would have the unanimous consent of the House for taking the vote row by row. Perhaps we could try something new this time. Perhaps you could start on the left instead of on the right.


The Acting Speaker (Mr. DeBlois):: Is the House in agreement that the division be taken by rows?


Some hon. members:: Agreed.
Private Members' Business


The Acting Speaker (Mr. DeBlois):: I would like to remind hon. members of the procedure followed when a division is taken row by row.
The members who are in favour of the motion will vote first. I will ask the members to my right to rise row by row. Then I will ask the members to my left to do the same.


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The Acting Speaker (Mr. DeBIois):: I declare the motion agreed to.


William Alexander (Bill) Blaikie: Mr. Speaker, I rise on a point of order. Maybe all those people who voted nay on the voice vote could stand up at some other time.


Some hon. members:: Oh, oh.


The Acting Speaker (Mr. DeBIois):: Order, please.
Bill read the second time and, by unanimous consent, the House went into committee. Thereon, Mr. DeBIois is in the Chair.


The Assistant Deputy Chairman:: House in Committee of the Whole on Bill C-280, an act to amend the Canada Pension Plan (disability pension).
Shall clause 1 carry?


Some hon. members:: Agreed.


Some hon. members:: On division.
Clause 1 agreed to.


Steve Eugene Paproski: Shall clause 2 carry?


Some hon. members:: Agreed.


Some hon. members:: On division.
Clause 2 agreed to.


[Stage Direction]
Title agreed to.
Steve Eugene Paproski: Shall the bill carry?


Some hon. members:: Agreed.


Some hon. members:: On division.
Bill reported.


Alan Redway: that the bill be concurred in.


The Acting Speaker (Mr. DeBIois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


[Stage Direction]
Motion agreed to.
The Acting Speaker (Mr. DeBIois):: When shall the bill be read the third time? By leave, now?


Some hon. members:: Agreed.


Alan Redway: that the bill be read the third time and passed.


The Acting Speaker (Mr. DeBIois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.
November 26, 1991


[Stage Direction]
Motion agreed to, bill read the third time and passed.


[Stage Direction]
The House resumed consideration of Bill C-4, an act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters, as reported (with amendments) from the Standing Committee on Finance.
The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 45(5)(a), the House will now proceed to the taking of the deferred divisions on the motions at the report stage of Bill C-4, an act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters. [English]
The first question is on Motion No. 5.


The Acting Speaker (Mr. DeBlois):: I declare the motion lost.


David Charles Dingwall: Mr. Speaker, I think you might find that there is a disposition among members in the House that the vote which has just been taken would apply also to Motions Nos. 53, 30, 42A, 58, 60 and 78.


Iain Francis Angus: Mr. Speaker, for further clarification, the NDP caucus will be voting against Motion No. 57 and in favour of all the remaining motions.
We will vote against Motion No. 57, but in favour of the remaining motions.


Mr. Hawkes:: Mr. Speaker, I think the proposition that came from the House leader of the Liberal Party is acceptable to the government. That would leave us voting next for Motion No. 57, but the remaining motions on Bill C-4 would have been settled on the basis of the proposition.


Mr. Attewell:: Mr. Speaker, I would just like to say that I will be voting in favour of Motion No. 42A.


David Charles Dingwall: Mr. Speaker, I think to facilitate the Order of the House, since my colleagues of the NDP have indicated that they will be voting against Motion No. 57, we can perhaps expedite the proceedings by informing the House that our party will be voting in favour of Motion No. 57.


Mr. Kindy:: Mr. Speaker, I will vote for Motion No. 42A.


Frederick James (Jim) Hawkes: Mr. Speaker, the government moved Motion No. 57 and will be voting for it. I think Motion No. 57 can be dealt with by putting the vote for Motion No. 5 but in reverse.


The Acting Speaker (Mr. DeBlois):: Hon. members have heard the terms of the motion made by the hon. opposition House leader and seconded by the other House leaders. Is there unanimous consent to agree to that motion?


Some hon. members:: Agreed.


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The Acting Speaker (Mr. DeBlois):: I declare the
motion lost.


Gilles Loiselle: that the bill, as amended, be concurred in.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: On division.


The Acting Speaker (Mr. DeBlois):: Agreed to on division.


[Stage Direction]
Motion agreed to.
 * *

[Stage Direction]
The House resumed consideration of Bill C-19, an act respecting banks and banking, as reported (with amendments) from the Standing Committee on Finance.
The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 45(5)(a), the House will now proceed to the taking of the deferred divisions at the report stage of Bill C-19, an act respecting banks and banking.

The first question is on Motion No. 1.


David Charles Dingwall: Mr. Speaker, there might be a disposition within the House that the vote on Motion No. 5 in Bill C-4 which was taken would apply to motions under Bill C-19, Motions Nos. 1, 4, 2, 2B, 6 and 11 and I believe there probably would be a disposition within the House that the motion to concur would be on division with regard to Bill C-19.


The Acting Speaker (Mr. DeBlois):: The House has heard the suggestion of the hon. opposition House leader. Is there unanimous consent?


Some hon. members:: Agreed.


Some hon. members:: Agreed.
Althouse
Benjamin
Blaikie
Angus
Blackburn (Brant) Breaugh
November 26, 1991

Brewin de Jong Fulton
Harvey (Edmonton East) Karpoff
Langdon (Essex-Windsor)
Mac William
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Whittaker-29
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Chadwick
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Clifford
Collins
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de Cotret
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Domm
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Fee
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Flis
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Gagliano
Gerin
Greene
Guilbault
Harvey (Chicoutimi)
Hicks
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Horner
Hudon
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Johnson
Keyes
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Lee
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++NAYS
Members
Anawak
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Government Orders
Saint-Julien
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Siddon
Soetens
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Tbrner (Halton-Peel)
Vankoughnet
Vien
Volpe
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Wilson (Swift Current-Maple Creek -
Winegard
Worthy
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Tremblay (Lotbiniere)
Van De Walle Vezina Vincent Walker Wenman Wilbee -Assiniboia)
Wood
Ynurur fAcadie -Bathurst)-175


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Frederick James (Jim) Hawkes: Mr. Speaker, on the sheet I have in front of me there was Motion No. 10 standing in the name of Mrs. Callbeck. Was that one that was deferred, or was it dealt with earlier?


The Acting Speaker (Mr. DeBlois):: Motion No. 10 was
negatived on division earlier this afternoon.


Donald Frank Mazankowski: that the bill, as amended, be concurred in.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


[Stage Direction]
Motion agreed to.
[Stage Direction]
November 26, 1991
Government Orders
The Acting Speaker (Mr. DeBIois):: It being 6.52 p.m., The House adjourned at 6.52 p.m. the House stands adjourned until tomorrow at 2 p.m..