1996-03-20

The Speaker: As is our custom, we will now sing O Canada, which will be led by the hon. member for Winnipeg Transcona.
Mr. Alex Shepherd (Durham, Lib.): Mr. Speaker, the Reform Party embraces a flat tax. This is at a time when multimillionaire Steven Forbes has been rejected even by the far right of the United States in his attempts to convince the American people the logic of this tax.
A tax which would lower taxes to those earning more than $200,000 while increasing the taxes of already overtaxed middle class people earning between $35,000 and $65,000 is the agenda of the Reform Party. Robin Hoodism in reverse. Taking from the less wealthy and giving to the wealthiest is the agenda of the so-called Reformers.
What else would a flat tax do? It would not tax interest. The banks will be very supportive. It will eliminate lower rates of income taxes for small and medium size businesses. So much for the Reform Party's job creation programs which will reduce small business employment while lining the coffers of financial institutions.
Reform thinking on flat tax is the same as those who thousands of years ago believed in a flat earth, the neanderthals of tax reform.
SentencingMr. Art Hanger (Calgary Northeast, Ref.): Mr. Speaker, whatever happened to truth in sentencing of criminals? In Canada unfortunately the most obvious truth about prison sentences is that they are a fiction.
For instance, section 745 allows criminals sentenced to life imprisonment the eligibility for release only 15 years into their sentence. It is a sure bet for criminals because 78 per cent of those who apply for parole under section 745 are granted early release. Using section 745, child killer Clifford Olson can apply for parole in August this year.
I speak on behalf of a growing majority of Canadians who believe that early release should only be considered for truly first time non-violent offenders. Canadians are telling justice officials to bring back the principles of truth in sentencing. You do the crime, you do the time.
Clearly section 745 must be repealed. On behalf of Canadians, I urge the justice minister to do so without delay.
LabradorMr. Bill Blaikie (Winnipeg Transcona, NDP): Mr. Speaker, the prospective privatization of services at the Five Wing Base in Goose Bay, Labrador will be a needless blow to Labrador. These are not the policies of careful and responsible economic management that the economy of Labrador so needs and expects of the federal government.
Liberals and Reformers have a lot of buzzwords for downsizing federal government services. Whether we call it privatization, commercialization, contracting out or alternative service delivery, it all boils down to the same thing: fewer jobs, lower pay, fewer benefits and greater insecurity.
The Liberals have called on the private sector to be responsible employers and to do its best to provide steady, secure employment. Behind this rhetoric the Liberals themselves are mimicking the worst corporate offenders with their self-defeating downsizing.
New Democrats join with the citizens of Labrador in demanding a federal government that sets an example of responsible economic citizenship.
Ceso International ServicesMr. Andrew Telegdi (Waterloo, Lib.): Mr. Speaker, I rise today to pay tribute to the outstanding volunteer efforts of Mr. Frederick Harttrup of Waterloo.
Mr. Harttrup, accompanied by his wife Olive, recently travelled to Trinidad to advise a government owned forestry company on production techniques and total quality management.
Mr. Harttrup made recommendations pertaining to log supply and quality, sawmill flow systems and layout and the operation of the saw show and the planer mill.
Mr. Harttrup is one of 7,000 Canadians who have volunteered their time through CESO International Services. Since its founding in 1967, CESO has been providing volunteer advisers to businesses and organizations in Canada's aboriginal communities, developing countries and emerging market economies in central and eastern Europe. CESO volunteers are skilled Canadian men and women, usually retired, who willingly share their lifetime of practical experience with those who need it.
To Frederick Harttrup and to all the CESO volunteers, we express our appreciation and we send them our thanks.
RacismHon. Warren Allmand (Notre-Dame-de-Grâce, Lib.): Mr. Speaker, March 21 is the first day of spring. It is also the international day for the elimination of racial discrimination.
This year's symbol for this day is the crocus, the first flower of spring and the symbol of a fresh start. This campaign encourages Canadians to break free from the darkness of ignorance into the light of tolerance and respect.
Thirty-six years ago on this day a peaceful march against apartheid in Sharpeville, South Africa turned into a massacre. All too often since then this tragedy has been repeated in different Sharpevilles around the world. These incidents may not always kill the body but racial discrimination destroys the soul and the self-esteem of the victim.
We in Canada take for granted our peaceful lifestyle, our reputation as a kinder, gentler nation. Yet we have our own less violent Sharpevilles in many parts of Canada. Each time we deny the cultural reality of our neighbour, denigrate his language or her costume, we commit an act of discrimination.
Canadian Armed ForcesMr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Mr. Speaker, last week my colleague from the Okanagan brought forth a motion to encourage this Parliament to think carefully about how it defines sedition. This was precipitated of course by the outrageous actions of the Bloc defence critic who invited members of the armed forces to switch their allegiance in the event of a yes vote. This was not a job offer. This was an invitation to desert the Canadian Armed Forces.
Canadians have expressed disbelief that a government could tolerate such an offensive and potentially dangerous act. Attempting to undermine the loyalty of the armed forces is completely beyond the pale in a democratic country.
The Liberal government tried to ignore this matter and it watered down the Reform motion to the point where it had no teeth. If the defence minister had been doing his job, this matter would not have required a special intervention.
We hope this has served as a wake-up call to this government.
SpringMr. Ted McWhinney (Vancouver Quadra, Lib.): Mr. Speaker, as the poet said:

Winter's rains and ruins are over, And all the season of snows and sins: The days dividing lover and lover, The light that loses, the night that wins: And in green underwood and cover Blossom by blossom the spring begins.

We bring spring greetings and the daffodils which some members are wearing from Vancouver where spring began some time ago. We also bring greetings from radio station CKNW, home of open line hosts Rafe Mair, Bill Good and Gary Bannerman.
RacismMrs. Eleni Bakopanos (Saint-Denis, Lib.): Mr. Speaker, tomorrow marks the International Day for the Elimination of all Forms of Racial Discrimination. It is a day for Canadians to reflect on the harm racism causes in our communities and to think of what we can do to make Canada a more tolerant society.
At this time last year, I really believed we had made progress in this area. However, the racist remarks and accusations made by the
Bloc and the PQ during the referendum, and especially those uttered by the former premier of Quebec, have only increased racial tensions in Quebec. Worse yet, the new premier of Quebec never distanced himself from his predecessor's racist comments.
Part of the solution is admitting that you have done something wrong. By refusing to apologize for their behaviour the Bloc and the PQ are saying that it is okay to make remarks like this and that people will eventually forget anyway. I have not forgotten and I am still waiting for an apology.
The FrancophonieMrs. Madeleine Dalphond-Guiral (Laval Centre, BQ): Mr. Speaker, in 1996, the economic, scientific and political reality of the Francophonie is 49 countries on five continents.
France is the only one of those countries whose only official language is French. Elsewhere in the francophonie, French is only one of the official languages.
In this context, it is up to French speaking countries to give French, a favoured communication tool, the place it deserves in all areas of human activity, at both the national and the international levels. Even if it is generally recognized that, in America, Quebec is a beacon for the Francophonie, we are also aware that the Francophonie extends beyond Quebec's borders.
It is with respect that we salute our cousins in the francophone and Acadian communities. We pay tribute to their courage and determination in fighting for their rights, despite the provincial and federal governments' anaemic political will to recognize in real terms the equal status of French in Canada.
Semaine Nationale De La FrancophonieMr. Mauril Bélanger (Ottawa-Vanier, Lib.): Mr. Speaker, today is the Journée internationale de la Francophonie. This day is celebrated each year with many activities and festivities that highlight the diversity of francophone communities across the country.
Today is also the second day of the Semaine nationale de la Francophonie organized by the Association canadienne d'éducation de langue française or ACELF. This is a great opportunity to recognize the important contribution made by francophones to Canada's linguistic, cultural and economic vitality.
As a member of Parliament of Franco-Ontarian origin, I am in a good position to note the full extent of francophones' contribution to society in Ontario and Canada. Ottawa-Vanier boasts many organizations that mirror the strong francophone presence outside la Belle Province. I am thinking in particular of the Ottawa campus of La Cité collégiale, the University of Ottawa, the many primary and secondary schools for francophones and immersion students, the Centre francophone de Vanier, the Richelieu service clubs, the Patro in Lowertown, Montfort Hospital, the regional ACFO, the Caisses populaires, and so on.
I urge all French-Canadians to be proud of their mother tongue and to contribute to its development.
Impaired DrivingMr. Dick Harris (Prince George-Bulkley Valley, Ref.): Mr. Speaker, last night during debate on my private member's Bill C-201 which deals with impaired driving causing death, the Parliamentary Secretary to the Minister of Justice cited in his remarks a letter from a member of MADD Canada which stated six reasons not to support my bill.
Jim Wideman, the executive director of MADD Canada wrote me this morning to set the record straight. He wrote:

On behalf of the board of directors of MADD Canada, I would like to reaffirm our support of the private member's Bill C-201. I am aware that other correspondence has been sent to Mr. Rock's office. Let me reiterate that the National Board of MADD Canada, our chapters and members wholeheartedly support Bill C-201.

Once again I would like to support MADD Canada, all its chapters and members who are in support of my bill. I urge members of this House to support it as well.
Semaine Nationale De La FrancophonieMr. Jean H. Leroux (Shefford, BQ): Mr. Speaker, yesterday, as part of the celebrations marking la Semaine de la Francophonie, author and songwriter Luc Plamondon was the 1996 winner of the Mérite du français dans la culture.
Over the past 25 years, Luc Plamondon has written more than 500 songs as well as musicals like Starmania, La légende de Jimmy, and Sand et les romantiques. On March 30, live from the Quebec National Assembly, Luc Plamondon will give a dictation he will have written himself as part of the third Dictée des Amériques, in which about 100 finalists will be competing.
I would also like to congratulate other winners: Métallurgie Noranda, for their workplace francization campaign; the Fédération des secrétaires professionnelles du Québec, for the use of French in the workplace; Paul-Sauvé school, in Saint-Vincent-de-Paul de Laval, for Pousse-Mine , its newspaper; as wells as many
radio and television shows such as "Le 6 sur 6" on CKOI, "Vidéo Rock Détente" on the Unimédia network-
The Speaker: I am sorry to interrupt the hon. member but his time is up.
Manila Disco FireMr. Jesse Flis (Parkdale-High Park, Lib.): Mr. Speaker, senseless tragedy has struck the world once again. Yesterday fire broke out at a disco in Manila. The disco was packed with students celebrating their graduation.
Reports show that at least 150 young people perished in the fire and scores were injured. Most of those who died were trampled to death in a rush for the disco's only exit.
On behalf of all Canadians, I wish to extend our sympathies to the families and loved ones of all who died. I also wish to offer my personal condolences to the constituents of Filipino origin living in my constituency of Parkdale-High Park who may have lost someone dear to them.
Our thoughts and prayers go out to everybody concerned.
RacismMr. Maurice Bernier (Mégantic-Compton-Stanstead, BQ): Mr. Speaker, tomorrow, March 21, is the International Day for the Elimination of Racial Discrimination. The nations of the world must realize how much social and human damage is caused by racism and segregation, at home as well as elsewhere in the world.
The global cultural mosaic is enriched by the diversity of the people who inhabit this planet. We should not let hate and scorn destroy our social fabric, when our communication technologies bring us closer and closer with every passing day.
Racial discrimination, however and wherever it is expressed, must be severely condemned not only by government authorities around the world, but also by you and me, and anyone who still dreams of a world where racism will be a thing of the past, lost in the history of mankind.
Semaine Nationale De La FrancophonieHon. Michel Dupuy (Laval West, Lib.): Mr. Speaker, it is an honour for me, as member for Laval West and former Minister of Canadian Heritage, to stress that this is the Journée internationale de la Francophonie, which marks the beginning of the Semaine nationale de la Francophonie.
I often had the opportunity, when visiting French speaking communities in western Canada, Ontario, Quebec and the Atlantic provinces, to see that they are dynamic and full of vitality. I also had the opportunity to talk with many Canadians who speak this beautiful language and who are proud of the French culture to which they belong.
I also met many fellow Canadians who adopted French as their second language. The 1996 edition of the Semaine nationale de la Francophonie seeks to pay tribute to the valuable contribution made by French speaking people, both in Canada and around the world.
Quebec Socio-Economic SummitMr. Nick Discepola (Vaudreuil, Lib.): Mr. Speaker, when he delivered his inaugural address at Quebec's socio-economic summit, the PQ premier said, like the Prime Minister had done a few weeks earlier, that he was greatly concerned by the issue of job creation.
The premier invited employers and business leaders to do their share to help create jobs. He said: "Employers must agree to voluntarily develop activity sectors requiring a larger workforce".
The PQ leader agrees with us that the responsibility for creating jobs does not rest with the government, but with the private sector. We are pleased to see that our respective governments came to the same conclusion as regards job creation.
We take advantage of this summit to remind the Quebec government that it is in our best interests to work together, in order to find solutions to the major problems affecting all Canadians and Quebecers.
RacismMr. Jag Bhaduria (Markham-Whitchurch-Stouffville, Ind. Lib.): Mr. Speaker, tomorrow, March 21 is officially the first day of spring. For many it signals the end of a long winter and the beginning of a beautiful spring and summer. As well it is the International Day for the Elimination of Racial Discrimination.
Although this date was declared 30 years ago by the United Nations as a symbol of the worldwide need to end racism, not enough progress has been made as racial discrimination remains prevalent within Canadian society. This fact was confirmed by
yesterday's report of the Canadian Human Rights Commission presented by its chief commissioner, Mr. Max Yalden.
Racial discrimination can rear its ugly head in all aspects of ordinary life: education, employment opportunities, justice, the workplace and housing to name a few. Nobody is ever born a racist. It is something that is learned through social interaction.
Hopefully this special day will signal the beginning of a renewed sense of tolerance within Canada.

Oral Question Period
Human RightsMr. Michel Gauthier (Leader of the Opposition, BQ): Mr. Speaker, yesterday the human rights commissioner accused the Liberal government of lacking the courage of its convictions, of dragging its feet. He even said the government ought to tidy up its own affairs before preaching to the rest of the world about respecting human rights. These are extremely serious accusations.
What explanation does the Prime Minister have for the fact that he has still not kept his promise-despite its being down in black and white in the red book, that book he is waving in our faces in the House all the time-to amend the Canadian Human Rights Act to include sexual orientation among the prohibited grounds for discrimination?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr. Speaker, first of all, I would point out to the Leader of the Opposition that his researchers ought to have checked out the red book, because that is not in it. It is a commitment I made myself during the election campaign, in a letter, and one I intend to keep.
We have been in government for a scant two years and a half. This year we passed legislation protecting the rights of the individual with respect to sexual orientation in the Criminal Code. A bill was passed and another is in the makings. Its time will come. It is our intention to keep this promise, which was not in the red book. As the Prime Minister has promised it, it will be done.
Michel Gauthier: Mr. Speaker, here we are now with the theory of throwing out crumbs to the people. "One crumb now, and perhaps another before the elections".
How can the Prime Minister explain the hesitancy of his Minister of Justice, if not by saying that his own caucus is deeply divided on this question?
Jean Chrétien: Mr. Speaker, many issues are raised in the House, and each bill is tabled in its own time. Priorities must be set and our legislative agenda must be organized.
As I have just said, one bill on the subject has been passed in the last twelve months. When the time is right, we will be introducing another in the House. However, in theory, we still have more than two years, seven months and four days before we have to call an election.
Michel Gauthier: Mr. Speaker, that seems a long time to the Prime Minister. He appears to be counting the days until it is over. We do not want to wait those two years and some months and some days for an answer. People are waiting. The human rights commissioner has asked the government to move quickly on this.
Given that the Prime Minister admits this was one of his promises, will he make a formal commitment to settle this matter, not only before the next general election but within a few months-which may be two ways of saying the same thing?
Jean Chrétien: Mr. Speaker, I have nothing more to say. I have indicated the government's position and a bill will be brought to this House before the next elections.
Mrs. Pierrette Venne (Saint-Hubert, BQ): Mr. Speaker, in its annual report, the Canadian Human Rights Commission issues a warning with respect to a Supreme Court ruling that, under certain circumstances, persons charged with sexual assault should have the right to consult the therapeutic records of victims.
My question is for the Prime Minister. Given that the Criminal Code has already been amended to prevent accused from cross-examining victims on their sexual past, is it not appropriate to follow this up and bring in legislation making it illegal to consult the medical and therapeutic records of sexual assault victims?
Mr. Gordon Kirkby (Parliamentary Secretary to Minister of Justice and Attorney General of Canada, Lib.): Mr. Speaker, I thank the hon. member for the question. This is an issue that has come before the courts in a number of court decisions.
The Minister of Justice in his capacity as attorney general has intervened on these issues. This is a matter now under consultation and review to see if legislative clarification is needed in light of Supreme Court decisions on these disclosures.
Pierrette Venne: Mr. Speaker, I am talking about decisions already handed down, not those to come. Since the Minister of Justice always relies on the courts to make the law for him, does the Prime Minister not think that by holding up the passage of effective legislation, he is creating a category of victims that will be forced to choose between disclosing their
therapeutic records and accusing their attacker, or keeping their records confidential and dropping their complaint?
Gordon Kirkby: Mr. Speaker, as I indicated, the Minister of Justice continues consultations in this regard with different individuals and groups interested in this question.
He is reviewing this for possible legislative change. Certainly it is a very difficult issue. One must on one hand balance the rights of the accused to a full answer and defence while on the other hand ensure victims are properly protected in the trauma of trials they need to go through.
This is a matter under review. An answer will be forthcoming.
The EconomyMr. Preston Manning (Calgary Southwest, Ref.): Mr. Speaker, while federal ministers have been jetting around the country trying to convince Canadians of the virtues of a $30 billion deficit, the separatist government in Quebec has embraced the need for deficit elimination.
Mr. Bouchard is apparently committing himself to eliminating the provincial deficit by 1999 or earlier, after consultation with business leaders, labour leaders, federalists and separatists, all of whom have told him this is necessary for a Quebec economic recovery.
Will the Prime Minister be convening a get together, a summit meeting of Canadian economic leaders to establish a firm date and a plan for eliminating the federal deficit and strengthening the Canadian economy?
Jean Chrétien: Mr. Speaker, we have a plan in the red book which was approved by the Canadian people in the last election. We are right on target.
Preston Manning: Mr. Speaker, we have the spectacle of the federal government's being now the only senior government left in Canada not committed to deficit elimination.
This is not just embarrassing to the House, it is a national disgrace and it is also dangerous to the cause of national unity. Once again the federal government is letting Quebec separatists get out in front on an issue, this time fiscal responsibility, which effects the attractiveness of federalism and national unity.
When will the Prime Minister set a firm date for deficit elimination? Is he prepared to let this slide and play catch-up with the separatist Government of Quebec?
Jean Chrétien: Mr. Speaker, the hon. leader of the third party should read the newspapers. Since the budget the Minister of Finance produced the Reform Party has had virtually nothing to say against the budget.
The market has reacted very well. Because we are following our target and not trying to talk about the year 2010 and so on, we have a goal of 3 per cent for this fiscal year. The interest rate went down by three points during the last year.
The Minister of Finance had set a target of 2 per cent for the year before and as usual he will do better than his target.
I think the question of managing the finances of the country is handled pretty well by this government.
Preston Manning: Mr. Speaker, I am really talking about the connection between the fiscal position of the Government of Canada and the unity issue. Once again the Prime Minister is not looking far ahead.
In order to win the next contest with the separatists the federal government must be, not appear to be, fiscally stronger and more fiscally responsible than the separatist Government of Quebec. It should be ahead on deficit elimination, it should be ahead on debt reduction and it must be ahead on tax relief if it is to win that contest.
Does the Prime Minister not realize that by dragging his feet on these three issues he is weakening the federalist position even before the next contest with the separatists begins?
Jean Chrétien: Mr. Speaker, if we were to rely on the leader of the third party to keep Canada united we would not be very secure.
I am amazed when I listen to the leader of the third party talk about presenting a budget and meeting our target. We heard some months ago that the third party was to present its own budget before ours but it chickened out.
Manpower TrainingMrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, my question is for the Prime Minister.
Yesterday, the Prime Minister said, and I quote:

As confirmed in the Canadian Constitution, we intend to leave manpower training to the provincial government and to pay for those who will receive this training without imposing, as Mrs. Harel herself admitted yesterday, any conditions with respect to the training itself.

Is the Prime Minister prepared to make a commitment in this House to have the active manpower training measures and the relevant budgets transferred to Quebec within three months, as
requested by Mrs. Harel and all the stakeholders currently gathered in Quebec?
Jean Chrétien: Mr. Speaker, we said, and I said that the funds allocated to manpower training, earmarked for manpower training, will be transferred to any provincial government as soon as an agreement can be negotiated.
Regarding all the active measures developed by the federal government to create jobs across the country, using the UI fund or government funds, these are federal programs under the Canadian Constitution and they will remain under our control. But as far as manpower training is concerned, I am prepared to sign it over tomorrow morning. The problem is that, any time we give an inch, they want a mile.
Just yesterday, the president of the Conseil du patronat, which is part of the consensus, indicated that the consensus was about manpower training. We respect the consensus and we are prepared to transfer responsibility for manpower training to the provinces tomorrow morning, provided the funds really go to providing training to the unemployed.
Francine Lalonde: Mr. Speaker, the Prime Minister should be better informed. All morning, participants at the conference have been saying very clearly that what Quebec is asking for is control over all active measures. I therefore ask my question again.
Is the Prime Minister prepared to make a commitment to recognize the Quebec consensus and negotiate the transfer of all active manpower training policies and relevant budgets accordingly?
Jean Chrétien: Mr. Speaker, they might as well ask for the transfer of the UI fund while they are at it. It is an active measure aimed at the unemployed. As I said, as far as manpower training is concerned-the bone of contention that has been used in this House for months now-we are prepared to transfer the related funds to the provinces, and we are waiting for them to come forward.
Immigration Red BookMs. Val Meredith (Surrey-White Rock-South Langley, Ref.): Mr. Speaker, when the current environment minister was in charge of immigration he spent $20,000 of taxpayers' money producing a booklet that could best be described as the Liberal red book, part two.
This booklet quotes from the red book on at least 43 separate occasions and is even entitled "Creating Opportunity". The only difference between this booklet and the red book is that the taxpayers had to pay for this copy.
Does the Prime Minister believe that having the taxpayers pay for the red book, part two, is an example of the honesty and integrity he promised to bring to government in the red book, part one?
Jean Chrétien: Mr. Speaker, they use the red book in the House of Commons in every second question. I guess it is a good document.
I have nothing to add to what the minister of immigration said yesterday about this.
Val Meredith: Mr. Speaker, the former minister of immigration produced this booklet despite objections of the bureaucrats in his department. It was destroyed by the current minister of immigration because in her words it was inappropriate.
Will the Prime Minister live up to the promise of the red book, the original version, and restore a little honesty and integrity to government by instructing the Liberal Party of Canada to reimburse Canadian taxpayers for the cost of this Liberal propaganda exercise?
Jean Chrétien: Mr. Speaker, the minister replied to this question yesterday. When she joined the department she decided she wanted to change some policies in the department, as happens when there is a change of ministers. New ministers approach problems in different fashions. She made a decision and the decision will stand.
Canadian Coast GuardMr. Yvan Bernier (Gaspé, BQ): Mr. Speaker, my question is for the Minister of Fisheries and Oceans.
Yesterday, the minister stated in this House that consultations were under way on the setting of marine service fees. But yesterday in Montreal, the commissioner of the coast guard was intransigent in refusing to make any changes to his new proposal.
Since the commissioner showed no intention of listening to the concerns of St. Lawrence stakeholders and simply defended his own fee setting plan, does the minister recognize that the commissioner of the coast guard is not holding a real consultation?
Hon. Fred Mifflin (Minister of Fisheries and Oceans, Lib.): Mr. Speaker, this issue has to be taken in its overall context.
I think everybody in the House would agree this is not a simple business of deciding on a maritime service fee for all of the country.
There are a number of options. One was to consider a port specific fee structure, but that would not work. Another was to consider a national system, but that would not work either.
The system we have now considered in this iteration of the consultation really looks at three regions: the Pacific, the Atlantic and the inland and Laurentian region.
If the hon. member says the commissioner of the coast guard was not responsive to suggestions, I have to remind him that no fewer than 300 people and parties were listened to. The marine advisory board has regular consultations with him. He is going on now to do more iterations and consultations. While he may not have given on major points yesterday, the purpose of the consultations is to have one more round before we go into effect.
Yvan Bernier: Mr. Speaker, yesterday, the minister made a commitment to table impact studies in this House. At the same meeting in Montreal yesterday, the commissioner of the coast guard admitted that the studies mentioned by the minister would not be completed before September, while the new fee structure would take effect in July.
How can the minister justify the coast guard's imminent decision on the basis of studies that will be carried out after the new fee structure comes into effect?
Fred Mifflin: Mr. Speaker, the hon. member is not doing anything to contribute to the ease of the particular system.
When we are dealing with something this controversial and complex across the country and we want to do it within a reasonable timeframe, of course there has to be feedback. The feedback takes place during the process of consultation, as the hon. member knows. He is smiling at me.
The imposition of the fees we were hoping would be done by April 1; however, it would appear we will not be able to do it until June. The $20 million collected on April 1 will now be later than that and every month that goes by we will have to collect more.
The hon. member is trying to impede the process. He is doing absolutely nothing to add to the simplicity of imposing these fees and coming up with an effective system across the country that is fair and reasonable.
Immigration Red BookMiss Deborah Grey (Beaver River, Ref.): Mr. Speaker, we know the environment minister used public servants and taxpayers' money to produce 30,000 copies of the Liberal propaganda aimed at Canadian immigrants. The minister knew exactly what he was doing when he ordered the documents, "Creating Opportunity", the red book sequel. It is the very same title, if we can imagine.
Not all of these documents were shredded and I offer to table a copy.
What will the Prime Minister do about this blatant, partisan misuse of public funds?
Jean Chrétien: Mr. Speaker, I just said that when the minister looked at the document she said it was not to be distributed and she had her own reasons for doing so.
We are working on a sequel to the red book. It will be ready for the election and it will again defeat the Reform Party.
Deborah Grey: Mr. Speaker, the question is who is paying for that red book?
The current minister now knows exactly why she shredded them. They were nothing more than partisan. Maybe we will at least give her credit for knowing that it was wrong and that something smelled about it.
The reasons are not good enough. I ask the minister that she stand up and answer to it. The former minister knew he was breaking the rules when he made the document. His departmental officials told him he was breaking the rules. His cabinet successor was so concerned about it that she tried to destroy the evidence.
As I said before, not all of the evidence was shredded and I have a copy which I am willing to table.
Canadians thought this kind of political sleaze belonged only to Brian Mulroney, but it has hung over to this Parliament.
Which red book should Canadians believe in, the red book that talks about integrity and honesty in government or the red book these people shredded to try to avoid a scandal?
The Speaker: Colleagues, some of the adjectives you are using are getting a little close. I appeal to you to think very clearly before using strong adjectives, which usually elicit a strong response from the other side.
Jean Chrétien: Mr. Speaker, I want to reply to the harsh words of the quasi-leader of the third party by saying that the government is very proud of its record of integrity. We have been in government for 27 months and there have been absolutely no serious accusations made by anyone.
I believe both ministers acted properly in this matter. We can stand the criticism of a party which has very little to show. It should put its own house in order first.
Indian AffairsMr. Claude Bachand (Saint-Jean, BQ): Mr. Speaker, my question is for the Prime Minister. Over the last few years, the federal government has acquired houses in the Oka area, some of which are illegally occupied by aboriginals. The Minister of Indian Affairs refuses to pay the hydro bills of these illegally occupied houses.
How can the Prime Minister let his minister drag his feet concerning the illegal occupation of houses in Oka, particularly in light of the resulting problems for Hydro-Québec, which wants to collect the money owed to it?
Mr. Bernard Patry (Parliamentary Secretary to Minister of Indian Affairs and Northern Development, Lib.): Mr. Speaker, I thank the hon. member for his question. The allocation of houses to Mohawks in Kanesatake is going very well. Ten houses are still occupied illegally. Necessary action was taken and formal notices were sent to squatters on December 21, 1995.
This is an internal issue which concerns the community itself. The community has a management housing board which must make its own decisions.
Claude Bachand: Mr. Speaker, the parliamentary secretary says it is an internal problem. In the meantime however, Hydro-Québec is suffering a loss.
I feel that the government purposely refuses to settle the issue. Since it is incapable of taking its responsibilities and settling the issue of illegal occupants in Kanesatake, could the government, as trustee responsible for aboriginal people and as owner of these homes, at least pay those hydro bills until the issue is settled? Hydro-Québec should not have to suffer the consequences of the federal government's carelessness.
Bernard Patry: Mr. Speaker, as I just said, this is an internal problem which concerns the band in Kanesatake. In fact, last year the department sent a letter to Hydro-Québec to advise it that it would stop paying these hydro bills, because this is an internal issue which must be settled by the Mohawks themselves.
TransportMr. Joe Comuzzi (Thunder Bay-Nipigon, Lib.): Mr. Speaker, in the recent budget the government announced that it was going to sell its 13,000 hopper cars. Those are the hopper cars used to transport Canadian grain to ports.
The statement begs three questions of the Minister of Transport. First, will the $400 million the hopper cars are worth be realized? Second, who will be the prospective purchasers? Third, will the terms of sale protect the farmers in Canada, including those in Ontario, and will it protect the ports in Vancouver, Prince Rupert, Thunder Bay and the down river ports of Quebec?
The Speaker: Usually members ask one question and sometimes slip in two or up to four. Take your pick, two out of the four.
Hon. David Anderson (Minister of Transport, Lib.): Mr. Speaker, I thank my colleague for that comprehensive question.
As the budget announced, the government is going to sell the 13,000 hopper cars which are owned by the department. Next week the department will be inviting proposals from potential financial advisers with knowledge and expertise in both rail financing and the grain industry who will assist in drafting the terms and conditions for the transfer and the terms of sale.
When considering proposals I can assure my hon. colleague that the interests of producers, shippers and the railways will be taken into account. The objective is to make the most efficient use of these cars and to achieve maximum benefit for the Canadian taxpayers.
How much will be achieved in the sale, I cannot at this time state.
ImmigrationMr. Ken Epp (Elk Island, Ref.): Mr. Speaker, the mysterious document that the former immigration minister published at taxpayers' expense and the current immigration minister shredded to avoid discovery was purely partisan, Liberal Party advertising.
I do not need to tell you, Mr. Speaker, that this is a very serious incident. Ministers of the government are not to use public money for party purposes. Doing so is a gross violation of public trust and an abuse of the public purse.
Who ordered the printing of the document entitled "Creating Opportunity" and how is the government to be held accountable?
Jean Chrétien: Mr. Speaker, when the government speaks about its programs they are of course related to its policies. The government has the programs.
When we say that we have implemented a program and have informed the people about it, a day does not go by without somebody getting up in the House and asking me: "When are you
going you do this or that because it was in the red book?" I always reply that it is in the red book.
When we say that we are on target for the deficit, it was in the red book. When we say that we will meet the 3 per cent target of the red book-
Dick Harris: What about the GST?
Jean Chrétien: Yes, it is partisan when I say that. It is what I said as the leader of the Liberal Party. I have repeated it as Prime Minister of Canada and I have done it as Prime Minister of Canada.
Ken Epp: Mr. Speaker, the red book promised integrity. It promised to get rid of the GST too. The immigration minister asked for this document to be printed because he thought it was government policy.
A big question is why the present minister decided it was inappropriate. The answer is clearly because it is partisan and that is not acceptable.
Will the Prime Minister show some ethics and solve this problem by asking for an apology for the Canadian people? Perhaps the ethics commissioner should be involved here.
Jean Chrétien: Mr. Speaker, I have a program. The government is implementing that program, a program that was established by the Liberal Party.
The promises of the Liberal Party have become the promises of the Liberal government. As a promise of this government it will be kept. When the government says it has kept its promises it says at the same that the Liberal Party has kept its promises.
Varennes TokamakMr. Stéphane Bergeron (Verchères, BQ): Mr. Speaker, my question is for the Minister of Natural Resources. Following the recent budget, the Minister of Natural Resources advised the board of directors of the Canadian Centre for Magnetic Fusion, which runs the tokamak facility for the development of fusion located in Varennes, that the federal government was cutting off its funding on March 31, 1997.
Does the minister realize, and I hope she does, that by withdrawing funding of $7.2 million from the Varennes tokamak, she will be depriving Quebec of the only major long term energy research project that might benefit the province?
Hon. Anne McLellan (Minister of Natural Resources, Lib.): Mr. Speaker, I am sure the hon. member knows that difficult choices have had to be made within all programs and all initiatives of the government. AECL is no exception. Its budget was reduced by one-third in the budget the Minister of Finance announced two weeks ago.
The priority for AECL in the coming years is to develop an export market for Candu reactors. Difficult choices have to be made. That is not to suggest this science is not good science. It is not to suggest that the people who have done it are not good scientists. It does suggest that in this difficult time choices have to be made, priorities have to be set and priorities have to be delivered on.
Stéphane Bergeron: Mr. Speaker, speaking of financial choices, I wonder about the minister's financial logic in this case when we know that shutting down activities at the tokamak facility in Varennes would mean the loss of 20 years of development in the field of fusion and $70 million in infrastructures, including $11 million in new equipment that will never be used, and above all, the loss of approximately one hundred jobs in the high tech field in Quebec.
Anne McLellan: Mr. Speaker, as I suggested a moment ago, choices have to be made, priorities have to be set. Fusion is not an energy priority for the government.
Stéphane Bergeron: We've noticed that.
Anne McLellan: I would like to remind the hon. member that my department has created a new research facility in Varennes that delivers on the government's priorities of renewable energy and energy efficiency.
ByelectionsMr. Bob Mills (Red Deer, Ref.): Mr. Speaker, 12,000 people of Haitian origin live in Papineau-Saint-Michel. Coincidentally the new minister for spending money in Haiti, Pierre Pettigrew, is running in the byelection there.
First, Pierre toured Haiti, then he picked up a $24 million tab for Haitian peacekeeping and spent several million taxpayers' dollars on aid to Haiti. Now he has arranged for the president of Haiti to visit Montreal this weekend.
Is the government prepared to tolerate this blatant influence peddling just to win a single byelection?
Jean Chrétien: Mr. Speaker, we are very happy that for the first time democracy is working
in Haiti. The president decided to come to Canada. I will be delighted to receive him in Ottawa Saturday.
We are doing our best to restore good government there. The United Nations and the United States have asked Canada to take over the role that the United States had there some months ago. I am very proud that the people of Canada are willing to help the poorest people of the world who live in Haiti.
If the president decides to come this weekend, we are not going to tell him to go back home until after the election. There is no connection at all.
Mr. Hermanson: Your nose is getting longer.
Jean Chrétien: There was none.
[Intervention]
Some hon. members: Oh, oh.
Jean Chrétien: There was none. Of course, all the Reform Party members can ask that question. The people from Haiti who live in Montreal have the good sense not to vote for the Reform Party.
Bob Mills: Mr. Speaker, the people of Canada are sick and tired of old line political patronage. Pierre Pettigrew has done everything except hand out free tickets to Montreal Canadiens' games in an attempt to win the byelection.
Also very interesting was his decision not to invite the Prime Minister to visit, but instead concentrate on more locally popular politicians like the Haitian president.
When the red book talked about governing with integrity, did that include unelected government ministers having a blank cheque to influence elections?
Jean Chrétien: Mr. Speaker, I wish to inform the Reform member that the President of Haiti is taking a trip outside his country. He has decided to visit the Dominican Republic, the U.S. government in Washington, and the Canadian government in Ottawa.
He was not likely to alter his itinerary to accommodate the problems of the Reformers. As I have already said, moreover, Montrealers of Haitian origin have sufficient judgment not to vote for the Reform Party, despite its trying every trick in the book to gain a few political points while dwindling away more each day from the Canadian political scene.
National DefenceMr. Robert Bertrand (Pontiac-Gatineau-Labelle, Lib.): Mr. Speaker, my question is for the Minister of National Defence.
Some time ago now, the special commission on the restructuring of the reserves released its report.
Could the minister inform the House what steps, if any, have been taken to deal with the commission's report?
Hon. David M. Collenette (Minister of National Defence and Minister of Veterans Affairs, Lib.): Mr. Speaker, the regiments, squadrons and ships of the Reserve Force are very important. They are a mirror of Canada's history and Canada's values. It is very important that they be maintained.
The traditions of our reserve force must be kept. Later this summer, I shall be reflecting on this matter, on the commission, on the House report, on the Senate report. In doing so, I should be mindful that the disbandment of units must be kept to a minimum, that control of the local armouries must be given back to the militia units and that there should be more people in the reserve and not less.
Canadian Broadcasting CorporationMr. Gaston Leroux (Richmond-Wolfe, BQ): Mr. Speaker, in their red book the Liberals promised stable multiyear financing for the CBC. When Mr. Manera was appointed, the Liberals promised that there would be no more cuts other than those imposed by the previous government.
On November 22, Mr. Beatty stated that any new cut to the CBC would lead to a change in its mandate. Well, the budget slashes the CBC's funding by $150 million.
My question is for the Deputy Prime Minister. Given what Mr. Beatty said in November, is the minister in the process of altering the CBC's mandate through the budget, that is to say, through the back door and without public debate?
Hon. Sheila Copps (Deputy Prime Minister and Minister of Canadian Heritage, Lib.): No, Mr. Speaker.
Gaston Leroux: Mr. Speaker, the Minister of Canadian Heritage says she is about to announce the creation of a cultural production fund. Does the minister intend to impose a CBC tax, thus shifting part of the deficit to the taxpayers and making them pay twice for the same service?
Sheila Copps: No, Mr. Speaker.
CommunicationsMr. Ray Speaker (Lethbridge, Ref.): Mr. Speaker, yesterday the Minister of Canadian Heritage upheld the CRTC's direct to home satellite policy which is so anti-competitive that not even the Prime Minister's son-in-law could make it work.
[Intervention]
Some hon. members: Oh, oh.
The Speaker: I would ask members to please stay directly on the issues and go to the administrative responsibility of whatever minister is involved rather than going off on side issues. I would ask the hon. member to do that.
Mr. Speaker (Lethbridge): This dramatic flip-flop occurred right after Power DirecTv decided that it wanted to throw in the towel.
My question is for the Deputy Prime Minister. What happened to the Liberal government's policy of competition in the direct to home industry?
Sheila Copps: Mr. Speaker, I am amazed that the member of the Reform Party has the gall to stand up and ask that question in the House when the government, in previously amending the Broadcasting Act, suffered such derision from the Reform Party. If the member wants to talk about flip-flops, the flip-flops are on that side of the House.
At the moment two companies are licensed to offer direct to home, Power Corporation being one of them. A third company is ready to come into the arena very soon.
In not turning back the decision of the CRTC, the government believed, as the CRTC believed, that the people who are currently receiving cable in their homes should not have to subsidize the cost of the high technology of the new direct to home instruments. Current television users should not be subsidizing technologies that may be coming in. It should be paid for by the people who want to bring in that technology.
Mr. Ray Speaker (Lethbridge, Ref.): Mr. Speaker, that answer just is not good enough. Competition in this country is being thwarted and stopped by that government policy. It has to change.
Other people support that position such as the Friends of Canadian Broadcasting. The British and Australian governments have made representations to the government saying that the current policy should change. The International Federation of Film Producers has threatened to take Canada to the World Trade Organization because of this type of attitude. Also some Canadians do not agree.
The government knows of these objections. Why is it continuing a policy that was brought about by the CRTC?
Sheila Copps: Mr. Speaker, part of our mandate as the Government of Canada is to defend Canadian consumers and not to defend American television producers and British and Australians who may be making representations.
In fact there are currently two companies that have an intention to proceed, including Expressvu and the Power Corporation. There is a third company that has just recently received a letter from the CRTC to hear its application.
The message of the CRTC is that Canadians who are currently watching television on cable lines they have paid for through their cable subscriptions should not have to cross-subsidize satellite television. If you want satellite technology, you pay for it.
Human RightsMr. Svend J. Robinson (Burnaby-Kingsway, NDP): Mr. Speaker, gay, lesbian and bisexual people in Canada are getting very tired of waiting for equal rights, not special rights. They are told that this government is saying that our rights are not a priority any longer.
Is it clearly the commitment of the Prime Minister that a bill will be introduced and passed in this Parliament before the next election? This would keep the promise the Prime Minister made in writing in July 1993 which I quote: "The Liberal Party of Canada is firmly committed to banning discrimination on the basis of sexual orientation". Is that clearly the commitment of this Prime Minister in this Parliament?
Jean Chrétien: Mr. Speaker, if the hon. member had been in the House at the beginning of question period, I replied to that question. I said a bill will be introduced. We passed legislation on that matter in relation to the Criminal Code a few months ago. The bill amending the human rights act will come eventually but not at this moment because we have other priorities. It is part of the program. We have passed one bill already and the other one will come in due course.
BanksMs. Beth Phinney (Hamilton Mountain, Lib.): Mr. Speaker, this morning the Globe and Mail reported that the major banks intend to continue their plans to expand their insurance business and sell insurance directly to consumers even though the finance
minister said that the existing restrictions on banks selling insurance would be retained.
Would the secretary of state for financial institutions explain to the House what steps the government is taking to maintain the existing restrictions on the sale of insurance by banks?
Hon. Douglas Peters (Secretary of State (International Financial Institutions), Lib.): Mr. Speaker, the government's position is quite clear. In the recent budget the finance minister said that the present restrictions on the banks networking insurance will be maintained.
The Canadian Imperial Bank of Commerce or any other bank cannot sell insurance to the customers in their branches. That is what the restriction means. They can and do own insurance companies who can sell insurance in other ways, in other places.
The Speaker: Colleagues, I have a point of order from the government whip. It is the first notification I have.
Points Of OrderMr. Don Boudria (Glengarry-Prescott-Russell, Lib.): Mr. Speaker, you will no doubt recall that during question period the hon. member for Red Deer, I believe in a question accused another member of this House of influence peddling. Influence peddling is a serious accusation in the Criminal Code. That kind of accusation I suggest cannot be made directly or indirectly in the House.
Citation 481(e) of Beauchesne indicates that a bad motive cannot be imputed to another member. Citation 487(1) indicates that threatening language is inappropriate. Citation 487(2) says that indirect accusations are just as inappropriate as if they were made directly.
This language must be withdrawn. It is not appropriate for such language to be used on the floor of the House against any member.
Bob Mills: Mr. Speaker, I would remind the hon. party whip that the person I suggested was doing this is not a member of this House. As he is not a member of this House, I would assume then that the rules of this House do not apply.
The Speaker: Colleagues, as I mentioned earlier in our debate, I would ask you to be very cognizant of the words that you use in this House. Both in the questions and in the answers some words tend to be more inflammatory.
I listened to the debates. It was my perception at least with the use of the words "influence peddling", if they were directed at a sitting member of Parliament, surely they would be unparliamentary and should be withdrawn. I go beyond that. I would ask that in the use of these words that they be not used in a very loose fashion.
I will take it upon myself to get the precise meaning by looking over the "blues" and the use of these two words "influence peddling". I will come back to the House and make a further decision or a further comment if it is needed.
I have another point of order from the hon. member for Beaver River.
Deborah Grey: Mr. Speaker, regarding question period as well, in my question for the Prime Minister I said that his Liberal government was imitating the political sleaze of Brian Mulroney. You got up and said that I should not be using derogatory adjectives and I certainly would not think of doing that. The word "sleaze" is a noun.
Further to that I also said that I would like to-
[Intervention]
Some hon. members: Oh, oh.
Deborah Grey: We can consider that one for the Beave, right?
Mr. Speaker, I offered to table at least one copy of the document by the former minister that was not shredded. It is called "Creating Opportunity: Fulfilling the Promise of Immigration and Citizenship".
I would like to seek unanimous consent to table it so that one of the unshredded copies will be kept forever more.
The Speaker: Is there unanimous consent?
[Intervention]
Some hon. members: No.
The Speaker: There is not unanimous consent.
Mr. Silye: Mr. Speaker, one or two weeks ago, did you not rule that we could table anything in this House without unanimous consent?
The Speaker: I hope I did not because I would have to eat crow right now.
A private member may have something tabled in the House with unanimous consent. With a minister it is a little bit different. I know that is the clarification the hon. member wanted.

Routine Proceedings
Government Response To PetitionMr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Madam Speaker, pursuant to Standing Order 36(8), I have the honour to table, in
both official languages, the government's response to one petition presented during the first session.
Journée Internationale De La FrancophonieHon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): On March 20, all French speaking countries around the world celebrate the Journée internationale de la Francophonie.
On behalf of the minister responsible for the francophonie, who will be with us in this House next week, I am pleased to mark this event.
Canada's involvement in the francophonie is a an essential element of its foreign policy.
The francophonie is a forum in which all Canadians, and especially our 8.5 million francophones, can affirm their sense of belonging and develop their culture. It is also a forum that highlights the solidarity between the 49 member states and governments.
At the francophonie summit in Benin last December, the Prime Minister outlined Canada's priorities within this forum for the next few years. First, consolidate francophone institutions. Second, define the francophonie's policy on conflict prevention.
In this context, I want to acknowledge two actions recently taken by Canada. At the Bordeaux conference, Mr. Pettigrew's proposal to create consultation committees on Burundi-a country ravaged by civil war-was approved in order to bring back peace.
Also, as a result of the work done by the Association des parlementaires de langue française in Haiti, my government made a commitment to maintain a peacekeeping force in that impoverished country. It was a difficult situation, but Canada has remained steadfast in its solidarity.
The Prime Minister, the Minister for International Co-operation and myself will have the honour of welcoming President Préval to Canada later this week.
Finally, as a third priority, Canada wants to put the francophonie on the electronic highway. Its access to and presence on the Internet are an essential part of keeping French alive and well in growth industries.
Canada is in the vanguard of new communication technologies. That is why we will host a conference on this subject very soon.
Finally, I would like to say a few words on the francophonie's huge impact within our borders.
Like their counterparts in many French speaking countries, French-Canadians speak the same language but with different accents.
I am thinking, of course, about Quebecers, who set the tone for our French culture. I am also thinking about the Acadian and other francophone communities across Canada who, by deciding every day to speak French, give the Canadian francophonie its full significance.
I am proud to say that the legislature in my province of Manitoba will soon inaugurate a monument in honour of Louis Riel, which recognizes the legacy of those men and women who were leaders of the Canadian francophonie. They are still inspiring us today.
I wish all French speaking nations and all francophiles in our country a great Journée internationale de la Francophonie.
Stéphane Bergeron: Madam Speaker, it is with great honour and pride that I rise today on behalf of the Bloc Quebecois to draw attention to the Journée internationale de la Francophonie.
This day is especially important for all Quebecers and all francophones in the rest of Canada, whose collective future is necessarily tied to that of la Francophonie as a whole.
Listening to the Minister of Foreign Affairs tell us proudly that 8.5 million Canadians are French-speaking, I could not help but reflect on the sad situation in which francophones outside Quebec find themselves.
If today we are celebrating this memorable day, this does not necessarily mean that we must ignore the bad position the French language is in everywhere else in Canada. Contrary to what the Prime Minister said, there are no longer one million Canadians outside Quebec for whom French is the language spoken at home, but only 640,000.
In actual fact, there are not 8.5 million people in Canada who still speak French at home, but only 6.3 million. That is 2.2 million fewer than suggested by the minister, if you exclude those who barely know the language.
In relation to the total population, this also represents a decrease in the francophone population in Canada as compared to 1981.
Instead of getting better, the situation of the French language outside Quebec is deteriorating. No wonder that the minister is trying to embellish reality, when in fact francophones outside Quebec are being assimilated at an increasing rate. The rate of assimilation is even as high as 75 per cent in British Columbia. We are pleased-
[Intervention]
An hon. member: It can't be soon enough.
Stéphane Bergeron: Madam Speaker, I must tell you that I just heard one of our friends from the Reform Party make a rather uncalled-for remark to the effect that it cannot be soon enough, that 75 per cent is not enough.
We are pleased to learn that a monument in honour of Louis Riel will soon be unveiled in the minister's home province. One can wonder however if the importance attached to la Francophonie by the government in that province is not limited to just that, monuments.
In Manitoba, the rate of assimilation of francophones is 50 per cent. The minister should not be proud, he should be ashamed.
More than 25 years of official bilingualism did not stop the assimilation of French speaking people outside Quebec. As well, there is no indication that, in Quebec, the relative percentage of French speaking people will be maintained. The irresistible attractive force of English in North America weighs more heavily than the progress made by the French language among allophone communities.
Moreover, the use of French in the scientific field is very problematic. Scientific research at the international level is done in English. No one can deny that. Indeed, English is by far the dominant language within the scientific community.
Nevertheless, this does not keep us from hoping that French will eventually be used more in the field of science. This is why we must increase our efforts to ensure that our scientists can spread the achievements of the Quebec and French speaking scientific community throughout the world.
Our researchers obviously have a responsibility to teach and to work in French.
As for the information highway, we are pleased that both the Quebec and the Canadian governments intend to be very active regarding French content. Let us hope that the Cotonou summit, in Benin, will have definitely put the French speaking world on the information highway.
Finally, French speaking states must also try to stop the erosion of the French language within international organizations. The challenge is, of course, to avoid letting English truly become the only language of communication at international forums.
In concluding, I would like to emphasize the urgent need for solidarity between Quebec, francophones in Canada and other French speaking nations around the world.
Our commitment in Haiti is a step in this direction and is to be commended.
Finally, I wish to point out that Quebec's sovereignty is now more obvious than ever to other countries in the Francophonie. There is no doubt that francophone countries have understood that the situation has evolved and that sovereignty is now only a question of time.
The close results in the last referendum have given additional moral weight to Quebec, the weight of a state that will soon become sovereign. Quebec will therefore play an increasingly important role in the international Francophonie. It has, furthermore, been named rapporteur for the Francophonie until the summit to be held in Hanoi, Vietnam, in 1997.
On behalf of the Bloc Quebecois, I wish a memorable day to all those who cherish this beautiful language.
Bob Mills: Madam Speaker, before I start my response, it is our position that we examine our membership in all organizations and certainly the francophonie is one of those.
I have listened to the minister say many wonderful things about the francophonie. I hope the minister's optimism is justified but I certainly have some doubts. My doubts really started last year during the francophonie conference in Benin when the member countries failed to condemn dictators as the Commonwealth had done during the meeting in New Zealand. Nigeria had been expelled from the Commonwealth because of its abusive government. This was action, not like what we saw in Benin.
At the Benin conference there was no action. There were not even strong words for the dictators of the world, some of whom are members of the francophonie. This made me wonder what this organization really does. Is there ever productive action or just an endless series of conferences that provides good photo opportunities for politicians? Is the francophonie about unveiling statutes and making warm, fuzzy speeches when it should really be getting things done? Is that not what international organizations are supposed to do?
Canada spends millions of dollars every year on the francophonie, but where was the francophonie when it came time to bail out Haiti, one of its members? Again there was no action. Instead Canadian taxpayers had to open their wallets to save the day. Why?
When the minister talks about the upcoming visit of the Haitian president to Montreal, I am surprised he can talk about it with a straight face. On the final weekend before the byelection in the riding with the highest concentration of people of Haitian origin, can the minister really pretend this has something to do with francophonie solidarity? It is about getting Pierre Pettigrew elected, plain and simple.
In the future the francophonie must shed its current image of an expensive forum where dictators mix with democrats to have
banquets and stage photo opportunities. This does nothing for the citizens of the member countries.
There are many poor people who live under repressive regimes and they deserve to have the francophonie working for their interests. These people need action, not meetings, discussions and political rhetoric. If the francophonie can provide this action, good, but the time for change is now, not five or ten years from now.
Being a forum for solidarity is no longer enough. The francophonie must become a functional tool to strongly press for democracy, peace and human rights.
Bill Blaikie: Madam Speaker, I rise on a point of order. I wonder if I could have the unanimous consent of the House to respond on behalf of the NDP to the minister's statement.
[Translation]
The Acting Speaker (Mrs. Ringuette-Maltais): Is there unanimous consent?
[Intervention]
Some hon. members: Agreed.
Bill Blaikie: Mr. Speaker, I am pleased to respond on behalf of the New Democratic Party to the statement by the Minister of Foreign Affairs. I would like to add my own best wishes to the francophones in Canada and around the world on the occasion of this Journée internationale de la Francophonie.
In the new world order, or more accurately the new world disorder, feelings of solidarity, of shared roots, of world citizenship have given way to relationships that are purely commercial. In that context it is most timely to celebrate international ties between cultural and linguistic communities such as those developed by the French speaking countries and communities. In our market driven world, we should cultivate communities, and the francophone world community helps us in that vital task.
Like the Commonwealth, the francophonie can and does play an important role not only in the cultural development of member states but also in their political development. Canadians look to the francophonie, like they do to the Commonwealth, as an agency that can play a creative and positive role in the challenging task of building an international community in which basic human and democratic rights are respected everywhere.
However, the francophonie has a way to go before it fulfils that kind of role in the way the Commonwealth has in the past, for instance with respect to South Africa. I share the urgings of a previous speaker that the francophonie needs to take a stronger stand with respect to human rights in its member states.
The minister mentioned Louis Riel. As a Manitoban I second his sentiments that a francophone was the founder of our province. The francophone parish, the parish of Notre-Dame-de-l'Assomption, was a founding element of the community I come from, Transcona.
In 1911 it was francophones from St. Boniface and from Quebec who came to Transcona and helped found the community. They are a vital part of it today. Their school formed the nucleus around which a very successful French immersion program was built in Transcona. It created an opportunity to learn French and also the French culture because it was an institution that grew out of the French speaking community in Transcona.
Allow me to again express my best wishes to all of the francophones of Canada, the francophones of Quebec, the Acadians, the Franco-Manitobans in my own riding of Winnipeg, and all other French speaking Canadians.
Committees Of The HousePaul Zed: Madam Speaker, I have the honour to present the ninth report of the Standing Committee on Procedure and House Affairs regarding the associate membership of various committees.
If the House gives its consent, I intend to move concurrence in the ninth report later this day.
Income Tax ActMr. Paul Szabo (Mississauga South, Lib.): 
moved for leave to introduce Bill C-240, an act to amend the Income Tax Act (child care expense).

Madam Speaker, I am pleased to table this bill in the House today, which proposes to amend the Income Tax Act to convert the child care expense deduction to a tax credit and to extend the same value of tax benefit to those who provide care in the home to their preschool children.
The bill will also recognize the honourable profession of managing the family home and caring for preschool children and eliminate in part the tax discrimination against families that make the choice to stay together and to provide direct parental care.
The bill represents not only a starting point but I believe a turning point whereby family values return to be a significant priority in this place.
If the family were strong, the deficit would be gone.
(Motions deemed adopted, bill read the first time and printed.)
Criminal CodeMr. Paul Forseth (New Westminster-Burnaby, Ref.): 
moved for leave to introduce Bill C-241, an act to amend the Criminal Code (punishment for subsequent and serious personal injury offence).

Madam Speaker, it is snowing today in Ottawa but the daffodils are up in my riding of New Westminster-Burnaby and we have some here today supplied by the radio station CKMW from my riding.
It is a pleasure to introduce the bill to the House. Too often following a serious crime we learn the offender has a long criminal record. We need some common sense crime prevention. This bill would imprison an offender for an indeterminate period of time should they be convicted of a second serious personal injury offence.
At first glance opponents of the bill say it resembles the three strikes and you are out laws currently be used in several U.S. states. However, this bill avoids the shortcomings of the American model. Stealing a pizza or painting one's name on a bridge or even writing a bad cheque, although hurtful and socially disruptive, are not examples of a serious personal injury offence as defined in the Criminal Code.
This amendment would operationalize the existing Criminal Code sections and protect the community from the few offenders who are causing the majority of serious crimes and who are unwilling to reform.
The way the law currently stands there is little deterrence for repeat offenders who commit serious personal injury offences. This bill goes to the source of the problem for the safety of the public. Most important, it places the victim's concerns before those of the offender.
I encourage all members to support this bill.
(Motions deemed adopted, bill read the first time and printed.)
Divorce ActMr. Jay Hill (Prince George-Peace River, Ref.): 
moved for leave to introduce Bill C-242, an act to amend the Divorce Act (joint custody).

Madam Speaker, first I would like to thank my hon. colleague from Athabasca for seconding this bill.
The Divorce Act is discriminatory. It leaves non-custodial parents, usually fathers, out in the cold. I know some very good fathers who always pay child support but can no longer afford to see their children because their mothers have taken them to live a considerable distance away.
Statistics show a direct correlation between access and non-compliance. Non-custodial parents who get to see their children are more likely to make their payments. However, custody now goes to one parent unless an application for joint custody is made. It should be the reverse.
Joint custody of and access to one's children should be automatic unless it is not in the children's bests interests. Today I am tabling a bill to amend the act to make joint custody automatic.
The recent controversy over child support payment taxation should not detract from the most important issue to children. In most cases that issue is not dollars and cents but guaranteed access to both parents.
(Motions deemed adopted, bill read the first time and printed.)
Committees Of The HousePaul Zed: Madam Speaker, if the House gives its consent, I move that the ninth report of the Standing Committee on Procedure and House Affairs, presented to the House earlier this day, be concurred in.
The Acting Speaker (Mrs. Ringuette-Maltais): Is there unanimous consent to move the motion?
[Intervention]
Some hon. members: Agreed.
(Motion agreed to.)
Paul Zed: Madam Speaker, I have a second motion. If the House gives its unanimous consent, I move:

That, the following change be made to the membership of the Standing Committee on Procedure and House Affairs: Pagtakhan for Bélanger.

The Acting Speaker (Mrs. Ringuette-Maltais): Is there unanimous consent to move the motion?
[Intervention]
Some hon. members: Agreed.
(Motion agreed to.)
PetitionsMr. Ronald J. Duhamel (St. Boniface, Lib.): Madam Speaker, a group of seniors in my riding call on the government to ensure that reforms of seniors' benefits be consistent with the historic commitment of the Liberal Party to elderly Canadians.
The petitioners want adequate income, appropriate health care and affordable housing. I believe they reflect the opinion of most seniors in Canada.
Paul Szabo: Madam Speaker, pursuant to Standing Order 36, I have two petitions to present today. The first petition is from Airdrie, Alberta.
The petitioners would like to draw to the attention of the House that managing the family home and caring for preschool children is an honourable profession which has not been recognized for its value to our society.
They also state that the Income Tax Act discriminates against families who make the choice to provide care in the home to preschool children, the disabled, the chronically ill or the aged.
The petitioners therefore pray and call on Parliament to pursue initiatives to eliminate tax discrimination against families who decide to provide care in the home for preschool children, the disabled, the chronically ill and the aged.
Paul Szabo: Madam Speaker, the second petition is from Burnaby, B.C.
The petitioners would like to bring to the attention of the House that the consumption of alcoholic beverages may cause health problems or impair one's ability, and specifically that fetal alcohol syndrome and other alcohol related birth defects are 100 per cent preventable by avoiding alcohol consumption during pregnancy.
The petitioners therefore pray and call on Parliament to enact legislation to require health warning labels to be placed on the containers of all alcoholic beverages.
Elwin Hermanson: Madam Speaker, I have a petition pursuant to Standing Order 36 to present from my constituents in the Kerrobert community and Luseland area. It was circulated prior to the budget.
It calls on the federal government to recognize that Canadians are paying approximately 52 per cent of the cost of a litre of gasoline at the pumps in the form of government taxes. The petitioners do not want to see an increase in taxes in the federal budget because of this high tax. I am happy to present this petition on behalf of my constituents.
Mr. David Chatters (Athabasca, Ref.): Madam Speaker, I rise in accordance with Standing Order 36 to present a further 2,400 names to the much larger petition asking Parliament not to increase the excise tax on gasoline.
I realize it is irrelevant to the recent budget, but certainly relevant to next year's budget. I am pleased to present them.
Mr. Jim Karygiannis (Scarborough-Agincourt, Lib.): Madam Speaker, I rise today to present a petition signed by numerous constituents of my riding of Tamil descent. They ask the Government of Canada to take an active role in bringing an end to the turmoil and atrocities from all sides that are currently taking place in Sri Lanka.
The petitioners ask us to assist to bring an immediate ceasefire and peace with justice in that part of the world.
Paul Forseth: Madam Speaker, pursuant to Standing Order 36, I wish to present a petition from my constituents of New Westminster-Burnaby.
I am pleased to point out that their diligent effort has paid off. These petitioners request that Parliament not increase the federal excise tax on gasoline and strongly consider reallocating its current revenues to rehabilitate Canada's crumbling national highways.
Svend Robinson: Madam Speaker, I have here a petition signed by people in Quebec who call upon Parliament to amend the Criminal Code to ensure the right of all Canadians to die with dignity by allowing people with terminal or irreversible and debilitating illnesses the right to the assistance of a physician in ending their lives at a time of their choice, subject to strict safeguards to prevent abuse, and to ensure that the decision is free, informed, competent and voluntary.
Svend Robinson: Madam Speaker, I have a second petition that is signed by residents of Manitoba and British Columbia which notes that the charter of rights and freedoms guarantees that everyone has the right to protection against discrimination and that the Government of Canada has recognized that this includes discrimination on the basis of sexual orientation.
The petitioners therefore call on Parliament to amend the Canadian Human Rights Act to prohibit discrimination based on sexual orientation.
Questions On The Order PaperPaul Zed: Madam Speaker, I ask that all questions be allowed to stand.
The Acting Speaker (Mrs. Ringuette-Maltais): Shall all questions stand?
[Intervention]
Some hon. members: Agreed.
Motions For PapersPaul Zed: Madam Speaker, I ask that all Notices of Motions for the Production of Papers be allowed to stand.
The Acting Speaker (Mrs. Ringuette-Maltais): Shall that agreed?
[Intervention]
Some hon. members: Agreed.
The Acting Speaker (Mrs. Ringuette-Maltais): I wish to inform the House that because of the ministerial statement Government Orders will be extended by 15 minutes.
Since today is the last allotted day for the supply period ending March 31, 1996, the House will now proceed as usual to consideration of supply bills. As is our custom, do hon. members agree that this bill should be distributed now?
[Intervention]
Some hon. members: Agreed.

Government Orders
SupplyMr. Monte Solberg (Medicine Hat, Ref.): moved:

That, in the opinion of this House, the GST should be "killed, scrapped, abolished".

Madam Speaker, Canadians have been waiting a long time to hear this debate in this place. After all, the promise to scrap, axe and abolish the GST was one that the Prime Minister, the Deputy Prime Minister and the finance minister made at various times over the last several years and of course during the election campaign.
After over two years into the mandate of the government, it is more than past time to have this debate. Sadly it is a debate that has to come from the opposition rather than the government which was proposing it during the election campaign.
It was a major campaign promise. In fact, I would argue that it was probably the most important promise that the government made during the 1993 election campaign. Some members across the way who were on doorsteps throughout this country told Canadians face to face that should the Liberals assume power the GST would be history, that it would be gone.
I am not going to make an elaborate argument against the GST. I do not think I have to. Government members have already made the argument for me. They made the argument during the election campaign and even since then.
I would like to run through a chronology of the different quotes that have been dug up from various members opposite to demonstrate there is a huge weight of evidence that the government did promise to abolish, to axe, to scrap, to get rid of, the GST. Today it is fudging on that promise.
By the way, Madam Speaker, I will be splitting my time with the hon. member for Capilano-Howe Sound.
I would like to go back into the public record and point out to the House what was said by hon. members on the Liberal side in the lead-up to the last election campaign and let Canadians judge for themselves and hopefully remind the Liberals and perhaps tweak consciences a bit so that when it comes time to vote they will vote for their constituents instead of voting for the party whip.
Let us go back to 1990. This was in the wake of the GST being brought in by the previous Tory government which had its own undemocratic ways about jamming bills through. I will go back to the Edmonton Journal of March 6, 1990 for the first in a long series of quotes that I am going to use this afternoon.
The Liberal Party would scrap the GST, the current Minister of Human Resources Development pledged in a nationally televised debate with former finance minister Michael Wilson in March, 1990: "The goods and services tax is a regressive tax. It has to be scrapped and we will scrap it".
Let us go to the Windsor Star of November 9, 1990. This is a quote by the current Liberal House leader: ``Not only do the Liberals oppose the GST now, that opposition will continue even if the bill is passed. We are not interested in tinkering with the GST. We do not want it at all''.
From an April 4, 1990 article in the Montreal Gazette : I would abolish the GST''. That was stated by the current finance minister. The current Prime Minister of Canada said in the Montreal &lt;em&gt;Gazette&lt;/em&gt; of September 27, 1990:I want the tax dead''.
Let us look at the chronology to see how things change over the course of years. Let us go to the Ottawa Citizen , February 11, 1991: ``I say we will replace the tax. This is a commitment. You judge me by that''. These are the words of the Prime Minister. The words are starting to change.
From the Toronto Star , November 7, 1991:

`Some senators are confused and upset by [the Prime Minister's] inability to consistently say that a Liberal government will scrap the GST', a senior Liberal source said yesterday.
[The current Prime Minister] was accused of flip-flopping after he backed away from a promise to abolish the GST on Monday, saying the tax would be `fundamentally changed' under a Liberal government. On Tuesday [the Prime Minister] was back saying he would scrap the tax after the 88,000 member Canadian Federation of Independent Business released a critical report on the GST.

I have dozens and dozens of quotes. I will obviously have to abbreviate them to get through my entire presentation. Let us skip ahead to the 1993 election year. Here is an interesting quote from the Toronto Star , February 12, 1993: ``The Liberal leader says it could be 1995 before he decides how to keep his promise to scrap and replace the goods and services tax''. We certainly wish it would have happened in 1995 but 1995 has come and gone.
I think a lot of people will remember this quote from 1993, one week before the election. I know the member across the way will remember this one because these are words that live in infamy in the world of the Liberals. This is from the current Deputy Prime Minister appearing on a CBC electronic town hall meeting one week before the election: "If the GST is not abolished under a Liberal government I will resign".
She said "abolished". As the hon. member for York South-Weston has been fond of pointing out about his own government, abolish is not synonymous with harmonize, which is what the Liberals are trying to convince Canadians they were saying during the election campaign. However, that is not the case and Canadians know better.
I want to fast forward a little now to 1994 and then ultimately to 1995 and 1996. Here is what the Victoria Times Colonist said on May 18, 1994:

The federal government will replace the hated GST within two years [the current Prime Minister] pledged Thursday.
Revenue minister-predicts that voters will punish any provincial government that fails to merge its sales tax with a revamped goods and services tax.
"Revamped"? That sounds suspiciously like tinkering with the worst tax ever imposed on Canadians instead of trashing it. If the voters are going to punish any government, it will be the federal Liberals for failing to deliver on a clear, specific election promise.
In fact, when [the current Prime Minister] was trying to entice Canadians into making him prime minister, he said it was the only specific promise he was making.

The weight of evidence is overwhelming and in the court of public opinion Canadians are not only trying this government, they are convicting it. I think they will mete out a very harsh penalty at the next election.
Let us go to the Ottawa Citizen , August 10, 1995: ``The hated GST will be replaced with a new national sales tax in next year's federal budget, the Prime Minister promised Wednesday''.
From the same day, an interesting quote from the hon. member for Mississauga West: "I think the GST is going to become a hot point. I think if we do not do something about it our credibility is gone. People in my riding hate the GST. It is not like one of those mild we do not like it, they hate it. If the GST is merged with provincial sales taxes voters will not be satisfied unless the overall tax take is simultaneously reduced. You cannot just do a little paper switch or move the shell and hide the peanut".
I think that is a wonderful quote and I think it is a perfect analysis of the situation.
Here is an interesting quote from the Ottawa Sun : ``In 1993 the Liberals promised to scrap the Tories' hated GST but so far have not kept their word. That broken promise, stressed the member for Broadwood-Greenwood, is going to come back to haunt them in an election expected next year. It is one word. It is trust''.
The hon. member for York South-Weston said: "I hope we do not try to hoodwink people into thinking our commitment was contingent on the provinces agreeing to harmonize their taxes with the GST". That came from a Liberal member, a member who went to doorsteps along with all the other members across the way trying to convince Canadians that if they voted Liberal they would get rid of the GST.
Now we have some members who are feeling their conscience. They are coming forward to the media and urging their party that the GST must be scrapped, abolished, axed, as they said it should be during the election campaign. Now we are starting finally to get some debate about that in the House thanks to the Reform Party because obviously the Liberals have not brought this forward to this point and it is not in their interest to do it.
This vote is a chance for Liberal members across the way to throw off the fetters of party discipline, to vote with their constituents and to finally fulfil their promise to get rid of the GST.
Mr. Ron MacDonald (Parliamentary Secretary to Minister for International Trade, Lib.): Madam Speaker, this is a very important debate. It has transfixed the Canadian public since the previous Conservative prime minister, without consultation with the Canadian public, brought in the tax and barrelled it through the
House of Commons. Clearly there are many of us on this side who understand the veracity of opinion with respect to this tax.
As the hon. member opposite selectively quotes, I remember quite clearly in the red book and during the election campaign we as a party in waiting, one that was soon to have been given the trust of the Canadian public, made it extremely and exceptionally clear what our platform was.
Rather than having to wait until opposition members with selective memories misquoted us, we put down in writing, in black and white, what our policies were.
With respect to the GST we had said in opposition that it was the wrong tax at the wrong time. At that point it was the wrong tax, it was the wrong time and it aided and abetted in the deepening of a recession caused by the previous government's misguided economic policies.
At the time of the election it was very clear to us that we would be faced with an enormous task to try to balance the books, to try to put our fiscal house in order. What we said at the time in the red book, in black and white, is that this government would get rid of the GST and that we would replace it with a taxation system which was easier to administer, fairer to small businesses and which took in the same amount of revenue.
I know my hon. colleague from the Reform Party is an avid reader. He quotes the red book often. It is one of his favourite pieces of reading material.
Would his party support today the abolition of the GST if it knew it would lead to a $17 billion increase in the deficit? If not, would he specifically tell us which programs would be cut which would amount to that $17 billion? Which social programs would be laid to waste? Which transfer programs would he and his party cancel? What would be the impact of those program cancellations be to, for instance, the people of Labrador who are in the middle of an election campaign and who are wondering which party better represents the future for the people of that riding?
Monte Solberg: Madam Speaker, the hon. member raises a number of issues. Let me underline that the confusion about what the Liberals said is apparent in his own party. I have quoted things which several Liberal members have said in the last couple of months. These are people who campaigned door to door under the impression that the Prime Minister, the Deputy Prime Minister and the finance minister meant what they said and intended to do what they said. Obviously they feel they have been let down.
The hon. member raised a good question. What would the Reform Party do? The Reform Party would wipe out the deficit and eliminate the GST in stages, unlike the government which is leaving a $17 billion deficit out there. The only thing that can happen when we have a deficit that large is that the government would move toward eliminating all kinds of services to seniors. It is talking about making more cuts to social programs, which it said during the election campaign it would never touch.
We see more broken promises. Quite frankly, we are seeing hypocrisy from that side equalled only by the government before it.
Mr. Herb Grubel (Capilano-Howe Sound, Ref.): Madam Speaker, Reformers do not really know how the Liberals can or will deliver on their red book promise to scrap the GST. However, it is their problem, not ours.
I remember vividly discussions about the strategy which Reform should follow during the election campaign. The suggestion came up that the idea of scrapping the GST is very popular; it would gain us lots of votes. However, cooler rational heads prevailed and said we could never deliver on that. It is not responsible to go to the people of Canada during an election campaign and say we will get rid of tax revenue worth $17 billion when the country is going bankrupt. Appropriately, we did the responsible thing and said we would eliminate the GST, as the people of Canada want, once the budget was balanced.
The difficulties in which the Liberals find themselves could not have happened to nicer guys.
I will address a question which has not been raised. The defence on the other side is: "We did not say we would get rid of it; we said we would replace it with something else. We would harmonize it". Harmonizing sounds like a good and interesting idea. However, it does not meet the requirements I believe the people of Canada have for a taxation system.
The general idea of a value added tax is supported widely in academic circles. It is a tax which encourages savings and investment. At a low tax rate it would not be too onerous and it would catch people in the underground economy who do not pay taxes. Whenever they spent their money, they would end up paying taxes.
The political process so destroyed the basic idea of a value added tax that it is appropriate it is not called a VAT like in Europe, but that it is called the GST. It is ironic that the cause for this abomination, the GST, this caricature of a value added tax was caused by the Liberal opposition members who sat on this side of the House. I have heard it told repeatedly how it all came about.
In a heated attack by the rat pack, the Minister of Finance of the day, Michael Wilson, without thinking through what he did, gave in to the incessant demands that at least food should be exempted from the value added tax. All the experts who have studied the history of the tax have told us that from that moment on we ended up not having a good GST, not a good value added tax. We ended up with the current abomination because he opened the floodgates
on exemptions which resulted in all kinds of difficulties which now exist. It is they who made it such a hated tax.
I sat through many, many weeks of hearings. Nearly a thousand witnesses told us what an abomination this tax is. Some episodes of how terrible a tax it is stand out in my mind. These difficulties will not be eliminated by harmonization; they will be aggravated.
The most memorable event was when a gentleman came to testify before the finance committee with a shopping bag full of cancelled receipts from his store. He runs a used goods store in Toronto. His business had shrunk by over one-half. He said: "People see a price of $100 on a used refrigerator. They say that is what they want and to ring up the sale on the cash register. The sales attendant hands a bill of $107 to the individual who says that he wants it for $100. We tell the customer there is GST on it. After a long debate which really irritated and made all the customers in the store mad, the individual gave up and said to cancel the sale and take back the refrigerator".
It was a most dramatic representation. The store owner said it was not an isolated incident. The receipts he had in the bag all had been cancelled within six weeks. He said: "It has been going on like this. My business is being wiped out. Where do these people go? They go next door, to smaller stores, to entrepreneurs who are less honest than I am and they end up not paying the GST". This is just one example.
We remember the difficulties of paying GST when we buy five muffins but not if we buy six. There were representations from restaurant owners who told us they cannot stand the competition. When they sell a pizza they have to charge GST on it. However, someone can go next door to a supermarket where the pizza is all made for them and all they have to do is pop it into an oven and they do not have to pay GST. That is highly unfair.
There are other things that are not very well known. The municipal sector is given special treatment. That sector does not have to pay GST. Fine, but consider that it has been found that some functions carried out by municipal workers can be achieved more efficiently and cheaply by contracting to the private sector. Lo and behold, when municipal employees collect the garbage there is no GST but when it is contracted out, there is GST. There is a tax on privatization. Is this right? This is highly inefficient.
We heard horror stories about the way in which the GST encourages the underground economy. Many conferences have been held and papers have been written on this subject. There are stories.
We hear about people who order a wing built on their house. They are given two prices, one with GST and one without. They
can pay by cheque if they wish or alternatively, they can pay by cash which will cost 7 per cent less. As we heard again and again in the finance committee, the people who offer these dealings not only fail to pay the GST, but they probably do not report the income from their work either.
We heard horrible stories about businesses being affected by a strange ruling. Natives are not subject to the GST. A store located outside the border of a reserve used to be quite profitable selling candy to children from the native reserve. It was doing fine, thank you. Children coming home from playing baseball would buy candy. Now the store is not able to compete any more. Somebody has opened a store on the other side of the border and does not pay any GST.
To summarize my point, the government is holding out the hope that all the difficulties existing with the GST, which the people hate so much and which we heard so much about in the finance committee, can be wiped out by harmonization. That is not going to be possible because of the abomination of having so many different exemptions to the tax. It is a terrible tax that cannot be saved. That is the conviction I have reached.
I therefore move:

That the motion be amended by deleting the word "should".

The Acting Speaker (Mrs. Ringuette-Maltais): The amendment is in order. On questions or comments, the hon. Parliamentary Secretary to the Minister of Finance.
Mr. Barry Campbell (Parliamentary Secretary to Minister of Finance, Lib.): Madam Speaker, I am really baffled. It used to be said about communists that the hardest thing about being a communist was predicting the past because of revisionist history. I see this going on in the Reform Party. It is incredible.
In 1990 the hon. leader of the Reform Party said that his party would repeal the GST. In 1991 he reversed and said that it could not be repealed immediately because that would increase the deficit. In 1992 his party changed its position again, that it would reduce the GST but in stages and after the budget was balanced.
In 1994 in a minority report appended to the finance committee's report on the GST, the hon. member for Capilano-Howe Sound said: "We commend the government on its attempt to harmonize the tax with the provinces. While we support the much needed harmonization, this would be a very difficult political objective to achieve". I recall he offered his help to achieve that.
Now there is a motion that states we should scrap it, end it, abolish it. We had a Reform Party alternate budget last year but
there is no Reform alternate budget this year. There is no provision for replacing the revenue from the GST that would not come after scrapping it.
I ask the hon. member for Capilano-Howe Sound, what is the position of the Reform Party today on the GST? What will it be tomorrow, the day after and the day after that? We have been through five different versions.
Further, would the member explain what was meant in last year's minority report when he and his party said: "We believe that a broadening of the tax base would address many concerns placed before the committee. That would also require an increase of the current GST rebate". He was clearly willing to talk about a broadening of the base to get a lower rate, including food, drugs, all manner of things.
Herb Grubel: Madam Speaker, at stake today is not the Reform position on the GST. At stake today are promises made during the election campaign which were very influential. When knocking on doors I heard all the time: "Why are you not promising to eliminate the GST? Why are you not doing this?" I said that we could not do so responsibly. People said that nevertheless they would vote for the people who would get rid of it. I won in my riding but I wonder in how many ridings the Liberals squeaked by, especially in Ontario, because they made this promise which they knew they could not keep. That is the issue. It is not an issue of how we m
Co-operative as we are with the finance committee, we are trying to understand what is best for Canada given what we have known all along but what the Liberals had denied during the election campaign: We cannot get rid of the GST but how can we make it better? Harmonization will be better but it will not solve the fundamental problems which are documented in the examples I have given. That is the issue.
The Liberals continue to claim that they did not say they would get rid of it. They have twisted it and said they would harmonize it and do something else, as if that would solve the problem. After studying the GST more than I ever wanted to, I can say that harmonization will not solve the problems that have made Canadians unhappy enough to tell me they would vote for the Liberals because I would not promise to get rid of it.
Ron MacDonald: Madam Speaker, perhaps I will be better able to get a straight answer from the hon. member opposite.
My colleague indicated quite clearly that it is extremely unclear what the current position of the third party is with respect to the GST. We heard the previous speaker from the Reform Party indicate that his party's platform during the election campaign was to eliminate the GST after the federal deficit was eliminated.
If the motion before us were adopted it would have the GST eliminated before the elimination of the federal deficit. Is the hon. member trying to tell us that his party would eliminate the GST, as was the case in its campaign platform, after the deficit has been eliminated? Or, in spite of the deficit, which is going down the right way but is not quite there yet, would he still eliminate the GST and add $17 billion a year to the deficit?
The Acting Speaker (Mrs. Ringuette-Maltais): Debate. The hon. Minister of National Revenue.
Hon. Jane Stewart (Minister of National Revenue, Lib.): Madam Speaker, I was fascinated by this motion which has been presented for us to debate here in the House by the hon. member for Medicine Hat. It states: "That, in the opinion of this House, the GST should be "killed, scrapped, abolished". Period. End. Full stop. Nothing more.
There is no indication here about how the third party would replace the GST; if it would replace the GST; how it would deal with the $17 billion in net revenues the goods and services tax brings in to the federal government. There is nothing that talks about that in this motion, this current, the fourth or perhaps the fifth iteration of the Reform Party platform on the GST.
I can only conclude that what Reformers must be saying is they do not care about those funds. They are taking the position that we can walk away from $17 billion and they are prepared to face the critics who say that this approach is foolhardy and irresponsible.
I said I was fascinated that Reformers would propose such a motion for debate today. However, I am really not surprised. Here again we have members of the Reform Party using political grandstanding to make some kind of point. I am not sure what it is. I am sure the last laugh is going to be on them. When we look at this, here again they are providing simple answers to very complex problems. Their political naivete is showing through yet again.
Also, the motion is intellectually dishonest. I sat on the finance committee with those members opposite. I listened as they did to Canadians right across the country about their concern for this tax, their hate for this tax.
We heard from large businesses which said: "If you do not harmonize this tax with the 10 provincial sales taxes, we will never have interprovincial trade that is free and open". We listened to small and medium size businesses which said: "If you do not harmonize this tax, the administrative nightmare we face daily is never going to go away". They said to us: "If you do not change this tax and make it more flexible so that we do not have to go through the same process as large companies do when we do not have accounting departments to do that, it is going to kill us".
We listened to individual Canadians who said: "This tax is driving us crazy". Yes, I remember that very individual, the retailer who came to our committee with his bags of tax receipts, showing the number of customers that had walked out of his store and not completed their transactions because they were not prepared to pay the final price. He said to us: "When you change the tax, make sure that the tax is included in the pricing on the floor".
We heard from advocates of social groups, social organizations, poverty organizations who said: "We understand that the government needs the $17 billion. We understand that you want to have a mix of tax regimes: corporate, personal income tax, and yes, a consumption tax. But for goodness sake, make sure that the notion of progressivity, that the rebate continues on".
I would point out at this time, Madam Speaker, that I am sharing my time with the hon. member for Willowdale and will look to you for a cue as my time runs out.
Let me continue by saying that as a committee we responded to these concerns. We made recommendations. As my colleague from St. Paul's pointed out, the third party said in its minority report: "We commend the government on its attempt to harmonize the tax with the provinces. While we support the much needed harmonization of the tax, this will be a very difficult political objective to achieve". We agreed that harmonization was important, that including the tax in the pricing was important, that changing the tax so it was more responsive to individual companies depending on their size was important.
I bring out the red book and quote directly from our platform, the platform we took to Canadians in 1993. It states: "A Liberal government will replace the GST with a system that generates equivalent revenues, is fairer to consumers and small business, minimizes disruption to small business and promotes federal-provincial fiscal co-operation and harmonization". We went beyond that. We presented a complete package to the people of Canada. We told them that we recognized this was a poor tax. It was poorly strategized, poorly conceived, poorly implemented. It is hard to administer.
We recognized, as I read from the red book, the answers. We said that in the first 12 months of our mandate we would talk to Canadians and confirm this with them, which we did as a finance committee. Lo and behold, the answer that came back was reflective of the position we took in our platform.
We know we have to replace the GST. We are committed to replacing it. We know that Canadians across the country support the strategy the finance committee put forward and which the Minister of Finance is working at achieving.
We are taking a responsible position here. We need to work with the provinces in order to make them understand that their constituents are the ones we talked to. The answers the provinces would get from the people in Ontario, British Columbia and Prince Edward Island are the answers we got as we crossed the country.
The answer is to come together, to have a single tax, to respond to the needs of the country, to improve our interprovincial trade, to respond to small and medium size businesses, which we know are the engines to our economic future, and to respond to individual Canadians. They do not want a tax but are prepared to pay taxes to support our social programs and our seniors benefits, those things that make this country unique and which are so important to us.
I admire the Minister of Finance for the work he is doing in his discussions with the provincial finance ministers. I will work as closely with him as I can to ensure that we have success in this regard.
In the Ministry of National Revenue we have come to the very clear conclusion that there is but one taxpayer and we want one tax administration. Therefore, in the budget and in the speech from the throne we have identified the importance of moving toward a single Canada revenue commission. We will consolidate the work of the department even more so than we have.
I would like to recognize the work of those members of my department who have consolidated very disparate branches of endeavour and brought them under one administration. We will continue to work with other federal departments such as agriculture, immigration and transportation to consolidate our work, reduce duplication, save money and reduce overlap.
We will then, with this agency, go forward and ask the provinces to work with us and consolidate the administrations that are dotting our country in each province and territory.
I am hopeful as we proceed along that agenda that we can clear the path and assist the Minister of Finance and draw to the attention of the finance ministers in all of the provinces how important the harmonization of this tax is, how important including the tax in the pricing is and how important it is to ensure that the tax regimes we have in effect in Canada are responsive to Canadians and to Canadian business.
That is the commitment we made as a Liberal Party. That is the commitment we continue to maintain and work toward as a Liberal government. I would ask members of the third party to remember the comments they made in their minority report, the support they gave to this position. I ask them to begin to work with us instead of continuing with this political grandstanding and flip-flopping to position themselves in whatever they view to be in the best view of the Canadian public at a certain point in time.
Jim Silye: Madam Speaker, I would like to tell the revenue minister that I will be addressing the minority report when I give my speech.
Concerning her comments and speech, the issue is twofold: what politicians or candidates say when they run for election versus what they do once they get into government. That is what is at issue here. When the Deputy Prime Minister ran as a Liberal candidate she said that if elected, the Liberal government would abolish the GST or she would quit. She believed it was time politicians kept their promise. She said words to that effect. Now, as Deputy Prime Minister the difference is: "If we do not replace the GST I will resign" and there is nothing about politicians keeping their promise.
At issue here with the GST is the language and rhetoric used is stronger at the door and implies or suggests so that people who are listening infer a different concept than what is in the red book. I will acknowledge that what is in the red book and always has been there is replace, replace, replace.
Now let us go to the next promise. In 1993 the current Prime Minister said: "We will replace it by 1995". What year is it now?
Mr. Thompson: It is a lot later than that.
Jim Silye: I think 1995 has come and gone. The government has had two years. There are 170 members in the government. When the Prime Minister was in opposition he said he would get rid of the GST in a day. Well he has been Prime Minister for two years and he cannot even keep the promise to replace the GST. He cannot keep the promise of the deadline. He has had two years. He said he could do it in a day. That is the issue.
With that short, short, very factual preamble, my question is: When will the Liberal government keep its red book promise and replace the GST?
Jane Stewart: Madam Speaker, I assume there is time to answer after that very short preamble. I would just point out that we on this side know it is 1996 and not 1950 like members opposite.
The member is talking about what people said at their doors. I remind the hon. member that in 1990 it was the Reform Party leader who said while his party was trying to get a new senator and its first member of Parliament elected, that the Reform Party would rip out the GST if it has been imposed against the will of the people. That was in the Reform Party's election campaign.
As I said in my comments this tax was conceived of and implemented poorly. It is now very difficult to administer as a result of the work of the previous government. The last thing I want to do is to inflict another ill-conceived replacement on the Canadian public. We will take the time needed to get this tax right because we are a responsible government. We have listened to what the people of Canada have said.
Mr. Jim Peterson (Willowdale, Lib.): Madam Speaker, first of all, I wish to thank the hon. members for Capilano-Howe Sound and Calgary Centre, who worked very hard with the finance committee in preparing the report on the future of the GST.
We worked very closely together. We travelled across Canada and they really supported our position that the amendments suggested by the committee were valid.
In part of the process we went through we looked at 20 different alternatives to the GST. It would do us well to recall very briefly those tax alternatives we looked at. At the time everybody on the committee, Reform, Bloc and Liberals said that we had to replace that tax. We could not just abolish it because we needed the revenue. So what tax alternatives did we look at? There were probably five different categories.
The first category of tax replacement was that maybe the tax could be abolished without replacing it and three scenarios under that category were looked at.
The first was that maybe the stimulus to the economy from getting rid of the tax would be so enormous that the economy would prosper simply by eliminating the tax. If that worked, why not eliminate more? It was the old supply side, trickle down Reaganomics that does not work. It was rejected unanimously by the committee.
The second alternative was to reduce government expenditures. However, to reduce expenditures by $17 billion in one year would have been too much for even this economy to swallow. We have made tough cuts and have been able to reduce program spending over a four year period by about $14 billion. That would have been even more dramatic and it would have had a terrible effect on the growth of the economy at that time.
The third alternative was to cut transfer payments to the provinces. At that time the transfers in cash were about equal to the net take on the GST. However, look at the implications that would have had on spending programs in the provinces. Look at the implications that it would have had for the programs that members on all sides of the House have asked us to support as a federal national government.
The next category of replacement was income tax alternatives to the GST. We had five of those: a personal income surtax, an exchanging of tax bases with the provinces, a flat tax, an additional flat tax add-on to the personal income tax, and a corporate income tax increase.
In essence, abolishing the GST and putting it all into personal income tax would have meant a 21 per cent increase in federal
personal income tax, which would be unthinkable when the top marginal rate in Ontario is 54 per cent.
There are many who said it could be done with corporate taxes. That would have meant an increase of more than 150 per cent in corporate taxes in that year.
Those are eight of the alternatives at which we looked.
The third category of replacement was revenue taxes. The first of these was a turnover tax. A tax of 1 per cent to 2 per cent could be imposed on every financial transaction, every business transaction, every sale which took place. The trouble is that it had been tried for many years in Europe. Although the rate is low, it cascades. Every time a transfer of goods or services takes place within a corporation it would be added on. It would not take account of efficiencies. That is why every European country which has used it rejected the turnover tax.
Then there was the payroll tax. It would take about a 3.5 per cent payroll tax to replace the GST. Some people advocated it. It would have been simple but who would have been paying it? Only the workers. Only the people who are already taxed by way of payroll levies and income tax. It would not have hit those who were retired. It would not have hit those who were living off enormous incomes which were not earned. It would not have been fair. It would have been a killer of jobs. We had to reject it.
The fourth category involved miscellaneous proposals for replacing the GST. We looked at a wealth transfer tax. We looked at green taxes. We looked at taxing gambling and lottery winnings. However, even if we could get the maximum out of those three different taxes, in their total they would not have accounted for more than about one-fifth of the GST. A lot of these were taxes which had been rejected in the past for very valid reasons.
The fifth category of replacement taxes which was looked at were the consumption based taxes. Six alternatives to the GST were looked at.
The first was the manufacturers' sales tax. Parliaments had unanimously rejected that in the past. It only applied to about 70,000 taxpayers. There were hundreds of thousands of exceptions to it. It was a very narrow base and it hurt manufacturing. It made manufacturers non-competitive.
A wholesale tax was looked at. It would have had somewhat the same impact, although not as bad as the manufacturers' sales tax. However it still had many anti-competitive aspects to it.
Next we looked at going to a straight federal retail tax, a single stage tax. But when we examined all of the provincial retail sales taxes which are single stage, a lot of testimony was given about how unfair these taxes were and how non-competitive they made businesses. Businesses ended up paying all sorts of retail sales taxes when they should not have.
Also there were certificates of exemption so that if a farmer wanted to buy a hammer to fix his barn he did not have to pay the sales tax on it. Many of these sales slipped through the net and businesses were being unfairly penalized. No one suggested that we go to the retail sales tax.
The next one was an addition method value added tax. This is where we started to look at the value added tax concept.
The 18th alternative that we looked at was a theoretical proposition, but only the academics have ever supported it, no one ever said it could work in practice and we rejected it.
The nineteenth alternative was one that had considerable merit potential. It was the business transfer tax. This would have been a value added tax that could have possibly worked in an ideal world where you did not have a federal state but a unitary state, only one level of government, where all governments could come on board at the same time, where you tax all the same base but you had a real problem accounting for imports and exports which are fundamental to our economy.
Universally tax experts, the business groups, the small business groups, the big business groups, the chambers rejected the business transfer tax which had previously looked as if it could have been the panacea.
The next alternative was to keep the GST the way it is. We could not because it imposes such a burden on small business and all Canadian taxpayers because they are supporting 10 different taxes at the retail level which is totally unfair. We could not support it even in terms of big business.
The system in Canada is the only system in the world where there is more than one tax at the retail level. Canada has 10 different taxes. Any party that stands in this House and argues that this is good for consumers, good for business, good for jobs, good for our competitiveness is absolutely insane.
We concluded that this system would not work. The only thing that could work was a national value added tax where the federal GST is eliminated, the nine provincial retail sales taxes are eliminated and they are replaced with one national value added tax under one administration.
This has such benefits for consumers, for ease of compliance by small businesses, for doing business across this country, for making every business, small and large, competitive. This is why we have supported this proposition. This is why we look forward to seeing it come in.
It is why I wish to move an amendment to the amendment put forward by the Reform Party. The motion reads: "That in the opinion of this House the GST be killed, scrapped, abolished".
I ask that the period be removed out after that and include the following words "and be replaced with a system that generates equivalent revenues, is fairer to consumers and small business, minimizes disruption to small business and promotes federal-provincial fiscal co-operation and harmonization".
Monte Solberg: Madam Speaker, it is my understanding that any amendment has to be addressed to our amendment which was to remove the word "should" from the original motion.
The Acting Speaker (Mrs. Ringuette-Maltais): I accept the point of order of the hon. member and move that this amendment is not receivable.
Herb Grubel: Madam Speaker, I wish to ask the hon. member who is a well known, famous, most competent tax lawyer whether during the deliberations of the Liberal Party of which he is an influential member, he ever advised his colleagues that it would not be possible to get rid of the GST.
Was he totally unaware of the difficulties which exist in harmonizing and doing all the other things that we had proposed? Did he warn his colleagues about this? Was he ignorant about it? Did he just say it to himself and not tell them? Was he simply rejected? How could a distinguished tax lawyer, with as much influence as he has, get his party to accept a resolution which any informed tax lawyer would have known could not be kept?
Jim Peterson: Madam Speaker, it is quite evident that the member for Capilano-Howe Sound is quite right. We realized as did he when he was working with us on the committee that the essence of getting a streamlined tax system for all Canadians is co-operation at the federal and provincial levels.
All of us knew this. We do not have the authority to dictate what the provinces do. However that does not mean we should not endeavour in all parties to try to make our country work better. All of us agree. I know the member who just asked this question agrees with us that it would be a significant improvement to the system if we could get rid of the 10 different existing tax systems and replace them with one tax system under one administration.
The saving in cost of compliance to small and big businesses would probably be in the neighbourhood of $400 million a year. The cost to all taxpayers by getting rid of 10 different systems and replacing them with one would probably be in the neighbourhood of $400 or $500 million each year.
The cost in aggravation to consumers of not having tax included pricing when they go into the store about which he spoke most eloquently would be enormous. Of course it requires the agreement of the provinces, as many things in this country does, in order to make it the type of country we want it to be. He knew that and we knew that when we spoke of it in the red book.
We said that we wanted the tax to be harmonized with the provinces, that is, we needed their compliance. We needed their co-operation. We needed their agreement. That has always been part of the understanding and he knows it.
While I still have the floor-
Jim Silye: Madam Speaker, I rise on a point of order. I thought I saw you rise after the member sat down. I saw you rise and begin to recognize someone, and now he is getting up to move a motion. I would think he is out of order.
The Acting Speaker (Mrs. Ringuette-Maltais): That is not a point of order. We were on the five minutes allowed for questions and comments.
Jim Peterson: Madam Speaker, because the hon. members opposite objected to the way I had worded my amendment earlier-
Ms. Clancy: What?
Jim Peterson: What I wish therefore is to do it in such a way that it does respect the amendment they made, which is what they have asked that I do. I will comply with their wishes and yours, Madam Speaker.
I move:

That the motion be amended by inserting after the word "should" a comma and inserting thereafter "be replaced with a system that generates equivalent revenues, is fairer to consumers and to small businesses, minimizes disruption to small business and promotes federal-provincial fiscal co-operation and harmonization and be killed, scrapped and abolished".

Jim Silye: On a point of order, Madam Speaker. I believe that to move an amendment at this stage is out of order.
The Acting Speaker (Mrs. Ringuette-Maltais): On the point of order raised by the hon. member for Calgary Centre, he is absolutely right. The amendment proposed by the hon. member for Willowdale is out of order, as he had finished his speech and we were in the midst of question and comment period. Therefore, I cannot recognize this amendment.
Mr. Richard Bélisle (La Prairie, BQ): Madam Speaker, the motion put forward by the Reform Party reads, and I quote: "The GST should be killed, scrapped, abolished". The Bloc Quebecois will support this Reform Party motion, because the GST should
purely and simply be abolished, although our reasons are different from those set forth by the Reformers.
How much money does the federal government make with this goods and services tax? When it was first established in 1991, it brought in $2.5 billion; the following year, in 1992, $15.2 billion; in 1993, $14.9 billion; in 1994, $15.7 billion; and last year, 1995, $16.8 billion. This is a tax that puts $15 or $16 billion in the federal coffers year after year.
Our position on the GST is not new. It was elaborated upon in the minority report presented by the Bloc Quebecois members of the Standing Committee on finance in June 1994. As far as we are concerned, this position is still valid, and I welcome this opportunity to outline it for the hon. members.
Madam Speaker, would you please ask the hon. members to let me speak in peace? I notice that certain members are in deep conversation in the back.
The Acting Speaker (Mrs. Ringuette-Maltais): Will the hon. members who need to discuss matters in this House, thereby interfering with our listening to the member who has the floor, please withdraw behind the curtains to have their conversations.
Richard Bélisle: Thank you, Madam Speaker. The liberal government is still reneging on its promise to abolish the GST. Let me quote a few lines from the March 11, 1996, issue of the Globe and Mail , which are very enlightening in that regard. First: ``I have already said personally and very directly that if the GST is not abolished, I will resign''. That statement was made to the CBC by the current Deputy Prime Minister on October 18, 1993, one week before the federal election.
As for the current Prime Minister, he is quoted as saying, also in 1993: "We will scrap the GST". The red book, published in 1993, states as well, and I quote: "A Liberal government will replace the GST". Again, in March 1996, the Deputy Prime Minister stated: "If we do not replace it, I will resign. I really do not have much choice. It will be replaced".
You probably remember that the GST and its abolition where big issues during the election campaign in 1993.
It was a major issue and it greatly helped the Liberals get elected. Since then, the Liberal strategy has been to downplay the importance of that issue, so as to make it easier to renege on their election promises.
During the election campaign, the Liberals made no bones about the fact that they were going to abolish the GST. Now, they talk instead of replacing it, of harmonizing it with provincial taxes. The Liberals are doing that because they are quietly paving the way for a national sales tax. Instead of abolishing the GST, they will make it even more pervasive.
The Liberal government, with its commitment to harmonize, now stands exactly where the Conservatives were. Indeed, before disappearing from the political map in 1993, the Conservatives were thinking of the same thing, harmonizing the federal and provincial sales taxes.
You have to admit that the Liberals and the Conservatives are pretty much one and the same. In addition to proposing a hybrid GST which in no way solves the management problems created by the GST, the Liberals want to impose this rigid tax to the provinces.
In view of this all-out attack against the provinces' authority, the Bloc Quebecois totally distances itself from the Liberal position and proposes instead to abolish the GST and to transfer to the provinces the tax field currently occupied by the GST. We feel this is the only way to implement a single tax system that would benefit the provinces.
As for Quebec, such a transfer would reflect its specificity and its fiscal autonomy. Quebec and other interested provinces could thus define the parameters of the new tax field, such as the goods and services that are taxable and not taxable, as well as the type of tax to be applied. This single tax would be administered and collected by each provincial government. Finally, this single tax should not take more out of taxpayers' pockets than do the current provincial sales tax, the QST in Quebec, and the GST together.
The Bloc Quebecois understands that the transfer of this tax field to Quebec could result in a significant loss of revenue for the federal government and that the latter should be compensated for that loss. Without touching transfers of tax points and special abatements-a tax field already occupied by the Government of Quebec-the federal government could reduce the transfer payments it makes under the various provincial transfer programs by an amount equivalent to the current GST revenues collected in Quebec.
This would also reduce federal interference in certain sectors of exclusively provincial jurisdiction, thus helping to cut back on duplication. In addition, as long as Quebecers pay their income taxes to the federal government, an equalization program should be maintained, without additional cuts, in order to offset the differences in the provinces' fiscal capacities.
In practical terms, our proposal would eliminate the duplication resulting from the existence of two parallel taxes and would reduce administrative costs for businesses, which would have only one tax to keep track of.
What is the context in which alternatives to the GST have been analysed?
It is a difficult context financially and economically. Middle and low income taxpayers have reached their threshold of tolerance. Unemployment rates are high and public finances are in such a
poor state that they are resulting in a risk premium on interest rates that is detrimental to investments.
The labour market is in a sorry state. Remember that with the increase in the population, we need several hundreds of thousands of jobs more in Canada, just to return to the level of employment at the beginning of the recession in the second quarter of 1990.
If we look at the tax statistics by income brackets published by Statistics Canada, we see that the increase in the tax burden of middle and lower income citizens is indeed real. Between 1972 and 1992, taxpayers saw a jump in real tax rates of 22.7 per cent. During the same period, taxpayers in lower income brackets saw their real tax rates go up by 42 per cent.
The increased tax burden has triggered the emergence of a flourishing underground economy. As the Liberal majority report states, analysts estimate the underground economy to represent somewhere between 2 and 20 per cent of the GDP. Only a total revision of the taxation system could make it possible to contain and reduce the size of the underground economy, because it is linked to the overall tax burden or, in other words, is dependent on all taxes paid by the taxpaying public.
The question of abolishing the GST and transferring it to the provinces arises in this context. All the commotion focussing on replacing the GST illustrates, more clearly than anything else could, the necessity of a total review of the federal taxation system. An examination of that system shows that high income individuals and major corporations have the financial means and the legal expertise to take advantage of a number of tax loopholes which save them considerable amounts of tax.
Think, for example, of the family trust scheme by which rich families can put off, virtually forever, having to pay capital gains tax on the assets held in trust. It is hard to estimate what the tax losses are on such tax deferments, because the Department of Finance keeps the figures hidden. According to a study commissioned by the Canadian Association of Family Enterprise in 1990, however, tax losses can be estimated at several hundred million dollars.
In 1993, when the Liberals were the opposition, they-the present Minister of Finance included-voted against reinstatement of the tax breaks associated with family trusts. Now the Liberals are refusing to abolish those same breaks, but they show no hesitancy in the least to dump on the unemployed, couples with child support agreements, and the pensioners of the future.
In fact the Liberals, just like the Conservatives in 1993, have given in to the lobby of rich influential families who want to keep their assets safe from taxes, while the tax burden on low income families continues to spiral endlessly upward.
Another example of unfairness are the tax havens. In the Auditor General's report in 1992, it was pointed out that the Income Tax Act and the tax agreements made it possible for foreign affiliates of Canadian companies to avoid paying tax in Canada and to take advantage of the lower rates of taxation available in a number of countries considered tax havens.
In fact, the auditor general estimates that more than $16 billion were invested by Canadian companies in tax havens, thus avoiding paying millions of dollars in taxes to the federal government every year. This means that, in a roundabout way, several Canadian companies are declaring abroad revenue earned in Canada.
Taking advantage of tax loopholes, many high income earners as well as big profitable firms do not pay a cent in taxes. It is to put an end to this kind of inequity that the Bloc Quebecois is demanding a comprehensive review of the Canadian tax system, not this business taxation committee comprised mostly of advisors working for firms using tax havens and contributors to the Liberal election fund.
The Bloc Quebecois is of the opinion that, in order to prevent big profitable firms from using complicated schemes to pay ridiculously low taxes, the government should impose a real minimum tax on the business profits made by large corporations instead of an easily avoidable capital tax.
The GST is not the only component of public revenue that needs to be reviewed and changed. In the minority report on the GST tabled by the Liberals in 1989 while they were in opposition, it is recommended that the Conservative government abandon its plans to introduce a goods and services tax and immediately initiate consultations with Canadians and the provincial governments on a fair and integrated reform of the tax system as a whole.
Now that they are in power, the same Liberals are content with trying to harmonize the GST and bring down three consecutive budgets that do nothing to eliminate unfairness. It is wrong to believe that all federal tax problems can be resolved by merely reforming our sales tax.
Several examples show that the Liberals are victims of their own policy of analyzing the GST separately from the other sources of federal revenue. Chapter 2 of the report of the Liberal majority on the finance committee, tabled in June 1994, states that wealth transfer tax cannot be considered as a replacement for the GST as it would not generate as much revenue.
This kind of reasoning rules out alternatives like a real minimum tax on large corporations making profits, the taxation of family trusts, the elimination of tax shelters, and so on. They rule out all partial solutions that, together, could do the job.
Finally, the Liberals are making exactly the same mistake as their predecessors by changing their minds about reviewing all sources of government revenue. By tackling only one aspect of the problem, the Liberals will never arrive at a lasting decision, because the tax system is a complex and delicate equation in which fair taxation and a balanced budget cannot be achieved by imposing a new tax in isolation.
The Bloc Quebecois' proposal would allow the Quebec government to put in place a tax that really meets Quebec's needs and avoid the mess that would inevitably be created by 11 parties trying to negotiate the base, administrative details and characteristics of the tax.
Our proposal would also make the Quebec government less vulnerable to the federal government's unilateral cuts in transfers to the provinces. At the operating level, it would eliminate the duplication resulting from two parallel taxes, improve control and reduce administration costs for businesses, which would have only one tax to manage.
Some may argue that our position would encourage consumers to take advantage of provincial rate differences. In this regard, we would like to repeat what the Liberal majority on the finance committee wrote in its report, namely that the committee recognized that the national VAT might encourage consumers to take advantage of rate differences, but no more so than today's provincial sales taxes.
It must be understood that the Bloc Quebecois' proposal derives from the basic principle guiding our policies: Quebec sovereignty. Indeed, sovereignty means, among other things, that the Quebec government would have full control over all these budgetary and economic instruments. It would then be free to use these tools based on Quebec's specific needs and Quebecers' aspirations.
The Bloc Quebecois makes this proposal from a Quebec perspective. However, it could also apply to any other province wishing to take control of the tax field currently occupied by the GST.
For these reasons, we will support the Reform motion to abolish the GST. The Minister of Finance wants to harmonize the GST with provincial sales taxes. This is a new centralizing attempt by the federal government. Why not harmonize that tax with the support of every province? As for Quebec, our proposal seeks, as I said, to abolish the GST and to transfer to the province the tax field currently occupied by that tax. Abolishing the GST does not mean merely changing its name, as the government might think.
Dick Harris: Mr. Speaker, I listened with interest to the member from the separatist Bloc party. His speech contained many interesting comments.
However, we have to get the debate back to the original intent of the motion put forward by the member for Medicine Hat to force the Liberal government to live up to the promises it made during the campaign prior to the writ period.
We want to address the very deceptive campaigning promises the government made prior to the election. Its members went around door to door, meeting to meeting, rally to rally and unabashedly told Canadians that if they were elected they would abolish, kill, remove, place six feet under, get rid of the much hated GST which they railed against in the House when the Tory government brought it in. I do not know how those members can sit here with such righteous indignation at our request that they simply live up to the promises they made.
There is one thing about Liberals that we all must know by now. If they say something verbally, we had better get them to write it down. They never used the words "replace", "harmonize" or "change" during their campaign, the verbal part of their campaign.
We have a couple of extremists in the Liberal Party, particularly the hon. member for York South-Weston. He remembers the campaign promise the Liberals verbally made to the people of Canada that if the Liberal government did not live up to its promise to abolish, kill, get rid of the GST he would vote against the budget. We support that member. It is too bad the government will not support its members who heard the promises with the true intent they were made.
The motion of the hon. member for Medicine Hat calls on the government to live up to the promise it made to the Canadian people before the red book was written and the words magically changed. We are asking the Liberals to live up to their promise, do the honourable thing and scrap, kill, abolish, get rid of, bury the GST like the Canadian people were led to believe they would do before the infamous red book came out and magically changed it.
Richard Bélisle: Mr. Speaker, I am in complete agreement with the hon. member who just spoke, because we in the Bloc Quebecois are simply asking that the GST be abolished and that this tax field be transferred to the provincial governments, and in our case, to the Government of Quebec.
I suspect that when the Minister of Finance tells us that he wants to harmonize this tax with provincial sales taxes, what he really wants is a single federal sales tax. He is going to change the name of this tax, call it something else. I also suspect the government of wanting to conceal this tax in the sales price so that it will no longer be noticed by customers. I think that as elected representatives, as parliamentarians, we must remain very vigilant, because I am
certain that the government will never abolish it. It will just give it another name and bury it in the price of goods and services sold.
The Deputy Speaker: Dear colleagues, it is my duty to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Laval East-securities.
Jim Silye: Mr. Speaker, I would like to ask the hon. member-
Nick Discepola: Resuming debate.
Jim Silye: Are we on debate or are we still on questions and comments?
The Deputy Speaker: There is time remaining for questions and comments.
Jim Silye: Mr. Speaker, that is why I appreciate the impartiality of the Chair. Government members were yelling at me that I was on debate. I wonder why they were yelling that.
Nick Discepola: It is because the Chair said "resuming debate".
Jim Silye: I stand corrected.
I thought the member's speech was very pointed. I thought it was an excellent speech and an excellent commentary. It shows us it does not matter which part of the country we come from. It shows us it does not matter which political party a person supported. The members of the Bloc Quebecois stood for something. They went door to door and told their people there needed to be change in Ottawa and they are here trying to put forth that change.
I do not agree with the change they are pushing for. I do not want the country to separate. I want them to reconsider. I want them to be a part of Canada. Nevertheless, they are here and they are doing what they have to do.
When we told the voters out west and in Quebec what we wanted they woke up, smelled the coffee and knew how bad the federal government was. They knew we needed to change the system so they sent us and the Bloc here and we have kept our promises. We backed out of the pension plan, as we said we would. We can be trusted to keep our word.
We presented a budget to the government and it laughed and scoffed at us. It is now whining that it does not have one this year that it can throw in our face when it cannot defend its own.
It does not matter where you are from in this country, what you say you should mean and you should keep your word. I would like the hon. member to comment on how his constituents react to what was said at the door by Liberals in his riding versus what they are doing now in government.
Richard Bélisle: Mr. Speaker, I am completely in agreement with the remarks of the hon. member who just spoke. I think that the government should permanently abolish the GST and, in addition, transfer this tax field to the provinces. The government should streamline the bureaucracy, as the Bloc Quebecois has been asking it to do for two years. Military spending should be further reduced; the boom should be lowered on family trusts; a committee on business taxation should be created whose members are parliamentarians, not specialists in tax havens; a minimum tax should be set on the profits made by corporations and something should finally be done about the $6.6 billion in unpaid taxes not recovered by Revenue Canada that the auditor general has been complaining about for the last two years.
If the government did all these things, it would be able to make up the $16 or $17 billion it is now collecting in the form of the GST.
Jim Silye: Mr. Speaker, I quote the current minister of fisheries, promoted to his job, from February 11, 1993, a man who I believe keeps his word, a man who believes in what he says: "Our alternative to the GST is that we are not going to have one. We are not going to have a tax that burns the individuals and the small businesses which then go broke because they cannot afford the people and computers to do it".
The red book states "replace". If the Liberals replace it through harmonization have they provided an alternative to GST, because we will still have the same hierarchy, administrative work and the valued added tax in place that we have to collect, get credit, pay back, collect, get credit, pay back? Will this problem be solved? Will it still burn individuals in small businesses? They will still go broke because they cannot afford the people and computers required to do the work.
Mr. Speaker, I will be splitting my time with the member for Esquimalt-Juan de Fuca.
I have another quote by the member for Broadview-Greenwood, whom I respect a lot because he stands up and says things he believes in and he believes what he says. He wants the government to consider tax reform. He wants the government to introduce a simplified system of taxation. He submitted to the Standing Committee of Finance ideas and suggestions supported by 17 of his colleagues on a way to keep their election promise, the promise he made at the door, because he is a man who keeps his word, to get rid of the GST and replace it with a flat tax.
We just heard the chairman of the Standing Committee of Finance talk about how that was impossible because there was not enough time to consider it. What a foolish statement to make when the Prime Minister sat in opposition and said: "I would get rid of the GST in one day". He has been here for over two years and has not replaced it. In 1993 he said he would replace it by 1995. It is now 1996 and he still has not replaced it. To me this is all about trust, integrity and being held accountable. That is what this debate is all about.
The hon. member for Broadview-Greenwood said: "It is no secret that we as Liberals, if we are given, and I say it humbly, the trust of the people in the fall, the GST will be scrapped". The Liberals have received that trust. They made those promises to replace the tax. They have not achieved, they have not engineered, they have not accomplished trust.
I have another quote from the current national revenue minister who I worked with in the standing committee. She is a person who I know has conviction, who believes in what she says and who will do what she says. In the Winnipeg Free Press , March 24, 1994 she said: ``As Liberals we were elected to change the tax, abolish the tax, scrap it''. She said this as an MP.
We know that certain members of the Liberal government, one for sure, has said publicly that because the government is not keeping its promise on the GST, he is going to vote against the budget.
There is a difference between what Liberals said at the door to get elected and with the phrasing in the red book which they are now hiding behind. The current minister of revenue, no matter how much she tries, and I heard her speech, said that they will change the tax, abolish the tax, scrap it or replace it. They still have not done it.
Now they throw back quotes in our face and say that when the Reformers worked on the Standing Committee of Finance this is what they said but they are all selective quotes out of context.
Let me put it back in context. In our executive summary, and this is after the first year we were here, we were trying to show Canadians that we were a constructive alternative. If we were going to criticize we would come up with some suggestions on how to make it better. Of course the government never listened.
We have heard bits and pieces of quotes for the last week in question period. The master of myth, the Minister of Finance, has used little parts of it. The member for Capilano-Howe Sound, the member for Lethbridge and myself were responsible for the minority report. We said the majority finance committee report on the replacement of the GST cannot be fully endorsed by the Reform Party. While the replacement goes part of the way in responding to concerns presented to the committee, many of the concerns will only be addressed by future negotiations with the provinces. Even that the Liberals are not doing in good faith.
If they really want this harmonization to work, if they really want to meet their commitment to replace the GST, they should be giving the provinces an incentive. But they want their 7 per cent. They want to leave the provinces with 8 per cent and still charge 15 per cent.
If they really want to have it they should reduce the federal rate by 2 per cent. Give the taxpayers a reason, an advantage and show that those efficiency costs can be passed on. This government does not pass savings along to the taxpayers because it is a tax and spend government.
The majority report recommendation merely tinkers with the current GST and does not live up to the Liberal promise to scrap it. That is in the report, that is quoted but then they stop.
Reformers are of the view that value added taxes are incapable of responding to a significant portion of the concerns raised during the hearings. The hon. member for Capilano-Howe Sound pointed that out very well in his speech. That is in Hansard if any of the members would like to check it out.
The third thing the Reform Party recommends is spending cuts be the government's first priority. It took the Liberals two years to even make a cut when they should have done it two years ago. This country would be $10 billion better off in terms of debt and $1 billion better off in lower costs in terms of interest.
As well, the entire current system of personal, corporate and value added taxes should be replaced. Here is what the Reform Party would do. It would use a simple, visible and fair system of taxation that incorporates the principles of fairness at the lowest rate possible.
In the interim the party will support reforms to the current regimes that move in this direction. I am adding today, with the staged elimination of the GST once the budget is balanced.
We have positions. We have suggestions. This government's strategy is to blame the provinces because they will not harmonize the tax systems. The government will not even be able to replace the GST. It does not want the provinces to agree with it otherwise it would have given them an incentive. It would have lowered the rates. There is no incentive. Therefore, there is no real desire.
The Liberals' strategy is to try to convince Canadians. The master of myth, the finance minister, says: "Let's put this deal out there. We'll blame the provinces. Let's throw it in the face of the
Reform members. We will select sentences from their executive summary, put them on the defensive, show that they support our harmonization and then we get out of it. We don't have to do it. We'll just make that promise, re-elect us and then we'll do it".
I predict that is what the Liberals are jockeying for. That is what they are trying to do, put themselves in a position so they do not have to keep that promise. Even in that promise of replacing the GST, Canadians will not be fooled. Canadians are smarter than the government thinks they are. Canadians should be given more credit than what the government gives them. They are not going to be fooled. They are going to see through this duplicity.
Talk about the intellectual dishonesty, of which the revenue minister accused us, of saying one thing to somebody face to face at the door: "If you elect me, I'll scrap something, I'll abolish something, I'll get rid of something, I'll kill something" and then not really point out to them that all they really said was they would replace it with something that generates equivalent revenue. That is not the rhetoric they used.
The Liberals said: "Elect me. I'll replace the GST". How would it have sounded if they had said: "Elect me. I'll replace the GST with something that gets just as much money out of your pockets as we are now". Would that not sound great? Would that not be the best way to get elected? That is why they will not keep this promise. That is why they cannot keep this promise.
I know I have a minute left, but I have said enough. I am sure everyone gets the message. I am sure the Liberals now realize that their intellectual dishonesty is going to come back and haunt them.
Bob Mills: Mr. Speaker, the constituents in my riding would not forgive me if I did not tell a story about what happened in my riding, in answer to the member for Calgary Centre.
A meeting was held there. There were 6,000 people in the Centrium and the message they gave to their member of Parliament at that time was: "Do not vote for the GST. The GST is a bad tax". That message came through loud and clear. Their member came back to this House and said: "The people of my constituency support the GST".
I remind the government about that. I remind government members that the same fate could befall them when they promised they would get rid of the tax. They said they would kill the GST. They said they would get rid of it and they did not deliver on their promise. Canadians know that and will reward them accordingly.
Mr. Keith Martin (Esquimalt-Juan de Fuca, Ref.): Mr. Speaker, "axe the tax". That was mantra of Liberal members before they were elected.
Who am I? I am opposed to the GST. I have always been opposed to it and I always will be opposed to it. Who am I? I am the Prime Minister of Canada, Mr. Jean Chrétien, on October 29, 1990.
The Deputy Speaker: The member will know that none of us is to refer to another member by his or her name.
Keith Martin: Thank you very much, Mr. Speaker.
Who am I? We hate it and we will kill it. The hon. Prime Minister of Canada, May 2, 1994.
Here we are in March 1996. When we go to the store, what do we pay? We pay the GST. It may as well be called the "get stuffed tax" because that is what the Liberals are saying to the Canadian public. They did not get rid of this reviled tax.
When I talk to the people of this country, when I talk to the people of my riding, when I talk to the businesses, no single tax is more reviled than the goods and services tax. It is complicated, it is expensive and it is inefficient. It was misleading for the government before it was elected to promise the people something that they so desperately wanted but which it has not given them. This tax provides $18 billion to the public coffers every year. How much of that actually gets to be used? Two-thirds. One-third of the tax goes into administration. How inefficient can we get? That is completely inefficient.
What the Canadian public needs and wants is tax relief. Reform members want the GST to go and we have a plan. What is that plan? The plan is to balance the budget. We simply cannot provide tax relief and get the GST down without doing that.
What has the government done? When I was elected two years ago, the government had $120 billion to spend on programs such as health care and education. What has it done? It has dropped it to $103 billion because it cannot balance the budget, something everybody here has to do in our private lives. Otherwise, we would go bankrupt. That is what is happening to Canada. We are going bankrupt.
It does every Canadian a great disservice to continue with the mythology that we can spend more than we take in. Two years ago Reformers put forward a specific, sensitive plan that would preserve the core of our social programs, that would preserve the core of health care and education to get the deficit down to zero and bring the debt down which is the true ogre.
We gave the plan to the Liberals and said, use it. Take it for all Canadians. Did they do that? Absolutely not. They continue to mortgage the future of all Canadians and compromise the lives of their children. That is reprehensible.
We have been accused of being the slash and burn party. I submit that we are the only political party that is committed to preserving social programs. We are the only party that has a plan on getting the deficit to zero, bringing the debt down so that we can preserve spending and give the public the desperate tax relief that they demand.
I challenge the members opposite to go into their communities, to speak to people about how they are overburdened by taxes. The GST is but one. Before they decrease the GST, we should get our spending down.
There are actions that the government can take today, and that includes simplifying this odious tax. It is absolutely absurd that the GST in its complexity exists. We can simplify it by businesses only putting in one submission every year. It would also diminish the amount of money that has to be spent on administration which is a complete and utter waste of money.
It shows a deplorable lack of trust and integrity on the part of the government that it will promise things purely to get elected. Reformers have not done that and the public finds it absolutely reprehensible that any political party does that. They will see through this at the time of the next election.
My hon. friend has put forward a brilliant way of simplifying the tax system. The government has done absolutely nothing to simplify a tax system so that the average person can fill out the tax forms.
Reformers are going to provide this year a simplified tax system for all Canadians to use so that they can fill out their own tax forms. Ultimately we will provide a way in which all Canadians will be able to get tax relief. That is the name of the game. We will provide it through a simplified tax system.
Once again I feel it is falling on deaf ears for some strange reason. Tragically for all Canadians the government failed to co-operate and use our constructive solutions to help all Canadians across the country.
Once again I challenge members across and I challenge the government to use our good suggestions. Nobody has a monopoly on suggestions for the country. However, we have a lot of good ones but the government has ignored them, to its peril. These suggestions come from the grassroots of the country.
The Deputy Speaker: It being 5.30 p.m., it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of the business of supply.
Is the House ready for the question?
[Intervention]
Some hon. members: Question.
The Deputy Speaker: The vote is on the amendment by Mr. Grubel. Is it the pleasure of the House to adopt the amendment?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
The Deputy Speaker: All those in favour will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it.
[Intervention]
Some hon. members: On division.
(The amendment is agreed to).
The Deputy Speaker: The next vote is on the main motion, as amended. Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
The Deputy Speaker: All those in favour will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the nays have it.
And more than five members having risen:
The Deputy Speaker: Call in the members.
(The House divided on the motion, which was negatived on the following division:)
The Deputy Speaker: I declare the motion as amended defeated.
[Stage Direction]
The House resumed from Tuesday, March 19, consideration of the motion.
The Deputy Speaker: The House will now proceed to the taking of the deferred recorded division on the motion of the hon. member for Saint-Hyacinthe-Bagot relating to the business of supply.
Don Boudria: Mr. Speaker, I rise on a point of order.
If you were to seek it, I think the House would give its unanimous consent that those members who voted on the previous motion be recorded as having voted on the motion currently before the House, with Liberal members voting nay on this motion.
The Deputy Speaker: Is it agreed?
[Intervention]
Some hon. members: Agreed.
Madeleine Dalphond-Guiral: Mr. Speaker, members of the official opposition will vote in favour of the motion.
Mr. Ringma: Mr. Speaker, Reform members, except for those who might wish to do otherwise, will vote no on the motion.
Mr. Solomon: Mr. Speaker, New Democrat members in the House will vote yes on the motion.
The Deputy Speaker: Colleagues, I take it there is unanimous consent to all of those motions made.
[Intervention]
Some hon. members: Agreed.
Mr. Ianno: Mr. Speaker, I would like to be recorded with the government side on the preceding vote.
(The House divided on the motion, which was negatived on the following division:)
The Deputy Speaker: I declare the motion negatived.
Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): moved:

That Supplementary Estimates (B) for the fiscal year ending March 31, 1996 be concurred in.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
The Deputy Speaker: I declare the motion carried.
(Motion agreed to.)
Marcel Massé: 
moved that Bill C-21, an act for granting to Her Majesty certain sums of money for the public service of Canada for the financial year ending March 31, 1996, be read the first time.

(Motion deemed adopted and bill read the first time.)
Marcel Massé: 
moved that Bill C-21, an act for granting to Her Majesty certain sums of money for the public service of Canada for

the financial year ending March 31, 1996, be read the second time and referred to committee of the whole.
(Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Kilgour in the chair.)
The Chairman: Order, please. House in Committee of the Whole on Bill C-21, act for granting to Her Majesty certain sums for the Government of Canada for the financial year ending March 31, 1996.
(Clauses 2 and 3 agreed to.)
The Chairman: Shall Clause 4 carry?
[Intervention]
Some hon. members: On division.
(Clause 4 agreed to.)
The Chairman: Shall Clause 5 carry?
[Intervention]
Some hon. members: On division.
(Clause 5 agreed to.)
The Chairman: Shall Clause 6 carry?
[Intervention]
Some hon. members: On division.
(Clause 6 agreed to.)
(Clause 7 agreed to.)
(Schedule agreed to.)
Mr. Duceppe: Mr. Chairman, before carrying on, can the minister assure this House that the bill is in the usual form.
Marcel Massé: Mr. Chairman, this bill is identical to bills passed in previous years.
The Chairman: Shall Clause 1 carry?
[Intervention]
Some hon. members: On division.
(Clause 1 agreed to.)
The Chairman: Shall the preamble carry?
[Intervention]
Some hon. members: On division.
(Preamble agreed to.)
The Chairman: Shall the title carry?
[Intervention]
Some hon. members: On division.
(Title agreed to.)
(Bill passed.)
(Bill reported.)
Marcel Massé: 
moved that the bill be concurred in.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
The Deputy Speaker: I declare the motion carried.
Mr. Williams: Are we not voting at this time, Mr. Speaker?
The Deputy Speaker: The matter has been carried so there is no debate.
Motion agreed to.
The Deputy Speaker: When shall the bill be read the third time? By leave, now?
[Intervention]
Some hon. members: Agreed.
Marcel Massé: 
moved that the bill be read the third time and passed.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
The Deputy Speaker: I declare the motion carried.
(Motion agreed to, bill read the third time and passed.)
Interim SupplyMarcel Massé: moved:

That this House do concur in Interim Supply as follows:
That a sum not exceeding $28,036,537,062.88 being composed of:
(1) seven-twelfths ($21,324,082,274.22) of the total of the amounts of the items set forth in the Main Estimates for the fiscal year ending March 31, 1997 which were laid upon the Table Thursday, March 7, 1996, and except for those items below:
(2) eleven-twelfths of the total of the amount of Canadian Heritage Vote 140, Natural Resources Vote L15, Public Works and Government Services Vote 25 and Treasury Board Votes 5 and 10 (Schedule A) of the said Estimates, $487,697,833.33;
(3) ten-twelfths of the total of the amount of Finance Vote 20, Justice Votes 15 and 20 and Transport Vote 1 (Schedule B) of the said Estimates, $1,286,805,833.33;
(4) nine-twelfths of the total of the amount of Canadian Heritage Vote 35, Finance Vote L25, Human Resources Development Vote 40, Indian Affairs and Northern Development Votes 15 and 45, Industry Vote 120 and Transport Vote 45 (Schedule C) of the said Estimates, $3,183,909,750.00;
(5) eight-twelfths of the total of the amount of Canadian Heritage Vote 65, Citizenship and Immigration Vote 10, Human Resources Development Votes 5 and 10, Industry Votes 65 and 110, Justice Votes 1 and 5, and Public Works and Government Services Vote 15 (Schedule D) of the said Estimates, $1,754,041,372.00;
be granted to Her Majesty on account of the fiscal year ending March 31, 1997.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
The Deputy Speaker: All those in favour of the motion will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed to the motion will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it.
And more than five members having risen:
Don Boudria: Mr. Speaker, I wish to seek unanimous consent that the members who voted on the opposition motion with regard to the GST be recorded as having voted on the motion presently before the House and that the members are recorded as having voted in the reverse way.
Madeleine Dalphond-Guiral: Mr. Speaker, members of the opposition will vote against the motion before the House.
Bob Ringma: Agreed.
John Solomon: Yes, we agree with that motion.
(The House divided on the motion, which was agreed to on the following division:)
The Deputy Speaker: I declare the motion carried.
Marcel Massé: 
moved for leave to introduce Bill C-22, an act for granting to Her Majesty certain sums of money for the public service of Canada for the financial year ending March 31, 1997.

(Motion deemed adopted and bill read the first time.)
Marcel Massé: 
moved that Bill C-22, an act for granting to Her Majesty certain sums of money for the public service of Canada for the financial year ending March 31, 1997, be read the second time and referred to committee of the whole.

John Williams: Mr. Speaker, on a point of order, we have moved from Bill C-21 to Bill C-22. Can you confirm that we are now on Bill C-22?
The Deputy Speaker: The member is absolutely right. We are on Bill C-22. Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
(Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Kilgour in the chair.)
The Chairman: House in Committee of the Whole on Bill C-22.
(Clause 2 agreed to.)
The Chairman: Shall Clause 3 carry?
[Intervention]
Some hon. members: On division.
(Clause 3 agreed to.)
The Chairman: Shall Clause 4 carry?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
(Clause 4 agreed to.)
The Chairman: Shall Clause 5 carry?
[Intervention]
Some hon. members: On division.
(Clause 5 agreed to.)
The Chairman: Shall Schedule A carry?
Gilles Duceppe: Mr. Chairman, I want to raise a very important point. I would like the minister to tell the House if the presentation of this bill is exactly the same as in previous years?
Marcel Massé: Mr. Chairman, the proportions requested in the bill will be used for all essential requirements of the federal administration until October 31, 1996. The bill does not release the total amount of any of the items. The bill is in the usual form of interim supply bills.
Passing the present bill will not prejudice the rights or privileges of members to criticize the items in the estimates at committee stage. The usual commitment is hereby given that these rights and privileges will be respected and that they will neither be abolished nor limited in any way through passing the present bill.
(Schedule A agreed to.)
The Chairman: Shall Schedule B carry?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
(Schedule B agreed to.)
The Chairman: Shall Schedule C carry?
[Intervention]
Some hon. members: On division.
(Schedule C agreed to.)
The Chairman: Shall Schedule D carry?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
(Schedule D agreed to.)
The Chairman: Shall clause 1 carry?
[Intervention]
Some hon. members: On division.
(Clause 1 agreed to.)
The Chairman: Shall the preamble carry?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: On division.
(Preamble agreed to.)
The Chairman: Shall the title carry?
[Intervention]
Some hon. members: On division.
(Title agreed to.)
The Chairman: Shall the bill carry?
Ken Epp: Mr. Chairman, we should be paying better attention. It is my observation that on most of these motions the nays have been much louder than the yeas, and I do not think it is correct for you as the chairman to say that it carries on division. It should be defeated on division unless the Liberals wake up and actually say yes.
The Chairman: I thank the hon. member for the point.
Shall the title carry?
[Intervention]
Some hon. members: On division.
(Title agreed to.)
The Chairman: Is the bill adopted?
[Intervention]
Some hon. members: On division.
(Bill reported.)
Marcel Massé: 
moved that the bill be concurred in.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
The Deputy Speaker: All those in favour of the motion will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the nays have it.
On division? I ask the hon. member for Elk Island, is it acceptable to carry it on division?
Ken Epp: Mr. Speaker, if we can be assured that the members of the governing party who are asking us to give authority for all this borrowing are awake and know what they are doing on behalf of the Canadian people, then yes.
The Deputy Speaker: I think that was a yes. I declare it carried on division.
John Williams: Mr. Speaker, on a point of order. By your own admission you said the nays carried the day. Therefore unless there is a recorded vote in the House this motion is defeated.
The Deputy Speaker: I thank the hon. member profoundly for that very correct observation. May I do it again?
All those in favour will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it.
[Intervention]
Some hon. members: On division.
Motion agreed to.
The Deputy Speaker: When shall the bill be read the third time? By leave, now?
[Intervention]
Some hon. members: Agreed.
Marcel Massé: 
moved that the bill be read the third time and passed.

The Deputy Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
The Deputy Speaker: All those in favour of the motion will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: Is there consent to carry it on division?
[Intervention]
Some hon. members: Agreed.
The Deputy Speaker: On division.
Bob Ringma: Mr. Speaker, on a point of order, we wanted this vote recorded, not on division.
The Deputy Speaker: I will have to do it again.
All those in favour of the motion will please say yea.
[Intervention]
Some hon. members: Yea.
The Deputy Speaker: All those opposed please say nay.
[Intervention]
Some hon. members: Nay.
The Deputy Speaker: In my opinion the yeas have it. We do not have to call in the members.
Don Boudria: Mr. Speaker, if you were to seek it I believe you would find unanimous consent that the vote applied to third reading of Bill C-21 be applied to third reading of Bill C-22, presently before the House.
The Deputy Speaker: Is there unanimous consent?
[Intervention]
Some hon. members: Agreed.
(Motion agreed to, bill read the third time and passed.)
[English]

Private Members' Business
Competition ActMrs. Rose-Marie Ur (Lambton-Middlesex, Lib.): 
moved that Bill C-221, an act to amend the Competition Act (illegal trade practices), be read the second time and referred to a committee.

Mr. Speaker, I appreciate the opportunity to lead off the debate on my private member's Bill C-221, an act to amend the Competition Act.
The bill would amend the Competition Act by making it an offence for manufacturers and distributors of motor vehicles and farm equipment to engage in certain marketing practices with their dealers. In the great majority of cases in Canada franchise agreements provide that a dealer shall not carry any other line, or dual, without the written permission of the manufacturer. In practice permission is rarely forthcoming.
There are generally two sets of consequences arising from this restrictive arrangement. In the first, the dealer's investment in one line of motor vehicles or farm equipment very often substantially exceeds the investment actually required to efficiently supply the sales and servicing demands faced by a particular a dealer in his or her market. In the second, a dealer may be forced to own several facilities selling different lines and may desire to amalgamate those brand lines under the same roof, thereby saving overhead and more efficiently utilizing his or her resources.
Because of the current prohibitions on dualling found in Canadian dealership agreements in neither of these cases can the dealer take the sensible course of action he desires to take. Further, if the dealer proceeds to attempt to dual his facilities without manufacturer approval, which is rarely granted, his action would constitute cause for immediate termination by the manufacturer of his dealership rights.
I believe all Canadian vehicle and farm equipment dealers aspire to having available to them the option of dualling, which their counterparts in so many U.S. states enjoy. Roughly 50 per cent of American automobile dealers operate their dealerships as duals, in some cases with more than two lines. Why should anti-dualling provisions which prevent that right in Canada be lawful?
By compelling manufacturers and distributors to allow their dealers the choice to offer one or more new lines of motor vehicles or farm equipment I believe two positive results would follow. First, the investment of the dealer would be utilized more efficiently and effectively. Second, the public in the dealer's market would be better served through a wider array of products and services.
As it stands now, in virtually 100 per cent of motor vehicle and farm equipment franchise contracts in Canada the manufacturer has the authority to terminate the contract if the dealer does not abide by the manufacturer's rules of dealer purity. This whole issue was brought to my attention shortly after the last election.
A constituent of mine who is a dealer in new and used farm equipment, and who has contracted with the Ford-New Holland company, wrote to me:

While it is true we have all signed agreements alluding to the sale of competitive products, it should be noted that for many of us we had no option but to sign this agreement, for our ability to stay in business hinged on the exclusive availability of the Ford-New Holland line. If I chose not to sign, I would have lost the business my father and I worked 40 years to build. It is true that Ford-New Holland is not restricting the number of agencies we represent as long as they are housed in separate facilities.
However, most of the lines Ford-New Holland deems competitive do not represent enough volume to operate as a stand alone dealership. Therefore the demand for exclusivity leads to lessening and even elimination of competition. This policy has far reaching consequences to our customers as well. By reducing the number of agencies willing to handle a line, you also reduce availability of service and repair parts. Our farmers today do not need a further erosion of service.

Why should rural dealers and farmers be denied reasonable access to all lines of agricultural equipment? As far as I am concerned, it is essential that dealers be given the freedom to carry more than one line of equipment to be of service to their farming customers.
All major farm equipment associations across Canada have been lobbying the federal government for years to have this onerous restriction on their livelihoods loosened.
The same is true of motor vehicle dealers. A 1993 survey of Canadian car dealers showed that about 50 per cent of the dealers would try to add another line if wide open dualling were permitted.
Presently the Competition Act provides that exclusive dealing can be prohibited by the competition tribunal in very limited circumstances. Subsection 77(1) of the act defines exclusive dealings as any practice whereby a supplier of a product, as a condition of supplying the product to a customer, requires or induces a customer to deal only or primarily in products designated or supplied by the supplier, or requires or induces the
customer not to deal in a specified products except as supplied by the supplier.
Under subsection 77(2) of the act, the director of investigation and research can apply to the tribunal for an order to prohibit a supplier from continuing to engage in exclusive dealing only if three conditions are met: first, if the supplier is a major supplier or if the practice is widespread in the market; second, if the practice of exclusive dealing is likely to impede entry into or expansion of a firm in a market, or to impede the introduction of a product into or expansion of a product's sale in the market; third, if as a result of exclusive dealing competition is or is likely to be lessened substantially, that is, in a major way.
In my opinion current anti-dualling provisions in Canada do fulfil elements one and two. However, element three, the substantial lessening of competition test imposed by the act for the director to be able to move against restrictions on competition occasioned by anti-dualling provisions, is unlikely to be clearly presented in the case of most vehicle and farm equipment dealerships in Canada.
To be really affective and fair, an amendment to the act should not only allow for enforcement action against anti-dualling provisions in franchise agreements but should also be framed in such a way that a dealer or a member of the public injured by the existence or the enforcement of such a provision will have the right to take private action against the restrictive provision.
Bill C-221 would effectively solve the problems created for dealers and the public through a simple prohibition of anti-dualling provisions in the franchise agreements. I also believe the bill has the benefit of brevity and clarity while identifying the restrictive conduct in those provisions as against the interests of the Canadian public.
By utilizing a prohibition to deal with the anti-dualling provisions, Parliament would be enabling dealers and members of the public who suffer loss or damage to take legal action for recourse independent of any action which the Bureau of Competition Policy may or may not be able to undertake.
Bill C-221's proposed prohibition of anti-dualling provisions will permit the crown to choose to proceed against an accused manufacturer by way of a summary conviction or by way of indictment. Typically the crown would proceed with a summary offence in less offensive cases and in the case of a first offender while reserving the potential for harsher penalties for cases of outlandish breaches and repeated violations by a manufacturer which has shown contempt for the law. This dual approach is seen in the act's treatment of misleading representation and has proved to work well.
In the process which led to the drafting of this bill, some have questioned whether it is not unusual to be proposing legislation amending the Competition Act that would only apply to just one segment of the economy. Not at all. There are a number of industry specific provisions in the act. For example, section 5 deals with the exemption from the conspiracy provision of the act for security underwriters. Section 6 deals with amateur sport in relation to the act. Section 48 deals with conspiracies in professional sport. There is even a subsection which deals exclusively with soft drink franchisers.
I suggest that the restrictions faced by dealers in motor vehicles and farm equipment are unique and particular to these types of dealerships.
We do not see the same restrictions applied to dealers in electrical appliances or musical instruments. Though each may specialize in one particular brand, each is free to carry other brand names as he or she may sees fit.
I am of the opinion that in the great majority of cases, when business is left alone, it tends to thrive when it is allowed to find its own solutions to problems that confront it. In that respect, I agree with the viewpoint that the role of government is to construct a framework that allows businesses to operate with the least amount of constraint.
However, there are instances when government is called on to correct an inequity which threatens the livelihood of certain sectors of the economy. Over the past two years I have become convinced that the constraints faced by dealers in automobiles and farm equipment must be properly addressed.
I feel it is very important that we give the small business community a break. The Prime Minister said a few days ago that it is time corporate Canada released its iron grip and did its part in allowing small businesses to expand and provide employment opportunities for Canadians.
I believe my bill echoes that sentiment and I ask for support from all members.
Mr. Nic Leblanc (Longueuil, BQ): Mr. Speaker, I am pleased to be able to speak this evening on Bill C-221, proposed by the hon. member for Lambton-Middlesex. This is a bill which regulates, or perhaps deregulates. It stops a manufacturer of motor vehicles, farm tractors or farm implements from preventing any dealer from selling other lines of products.
Examining this deceptively short bill, I became aware that there were very serious consequences to accepting something like this. I wonder, in fact, whether the hon. member even took the time to examine the consequences to any extent.
We are aware that this country has a debt load of approximately $600 billion at this time, and we also have our own individual debts. We each of us have fairly considerable debts ourselves, we are even probably more in debt than ever before. In other words consumer buying power is very low.
The automobile and farm equipment industries are barely viable at this time. Many dealers are having trouble keeping their heads above water; many are losing money even. Changing the way dealerships and sales of farm and automotive products are organized too rapidly would be very problematical.
We in Quebec-and I believe the same goes more or less for the rest of Canada-have a network of dealerships in place. In the past 20 or 25 years, many new car dealerships have sprung up, and we have invested considerably in them. We have invested some $500,00 to $2 million in buildings and showrooms.
Highly specialized equipment was bought, as required to perform automotive and tractor maintenance. As we all know, this kind of equipment is becoming more and more sophisticated, with state-of-the-art mechanisms, thus requiring sophisticated maintenance, which means that dealerships must invest substantial amounts to provide good customer service. Sales people must also be trained to sell specific makes of cars, tractors or farm machinery.
All this means a great deal of expense for car and farm machinery dealerships and manufacturers. Very large sums amounts of money are spent on marketing this expensive and sophisticated equipment. Obviously it would be out of the question to change the whole marketing system overnight.
Personally, I think it would be very dangerous and expensive to decide overnight to allow a car dealership to sell other makes of cars for example. That would probably be too easy.
Let me give you an example. Say a dealership signs an agreement with a manufacturer to sell a line of cars with several models but later realizes that the models do not sell well or that it is unable to market the product properly. Because these models do not seem to sell, the owner decides, overnight, to start selling-assuming this was a GM or Pontiac-Buick dealership-Nissan or Toyota cars.
I do not think the Nissan or Toyota dealer would be very pleased to see a GM dealer selling his products. He would probably choose the top-selling models to the detriment of those that are less popular and thus hurt his competitors.
I am neither for nor against this bill, but after examining it, it seems to me that there are serious risks to passing this type of bill. It would certainly be very important to allow a period of adjustment. Certainly, five or ten years, and maybe longer should be allowed to change this marketing structure, which has been in place in Canada and the United States-but we are concerned here with Canada-for years, and particularly for the last 25 years, during which automobile and farm equipment dealers have invested large amounts of money.
I am sure that if we began to upset this marketing approach, chances are there would be a considerable number of bankruptcies, and many jobs lost. That is why I mentioned at the beginning of my speech that we are not in a period where we should make changes too quickly. A lot of jobs could be lost. What we need now is to create jobs, but I think that we would risk losing a lot of jobs if we turn the existing marketing structure for automobiles and farm equipment upside down.
I would suggest that the hon. member continue to examine and work on her bill. She could try to form a small committee to analyse, to question witnesses from the makers, for example, to ask them their opinion.
What do consumers think of it? What do dealers think of it. They should be asked because I am not even sure that a consumer would feel very secure if he saw a large car dealer, in Montreal or Toronto, selling a dozen lines of automobile and a hundred or so models. I cannot see the consumer being reassured, knowing the complexity of the service and the guarantee.
Would he feel secure about after sales service? The consumer might also perhaps have doubts. Can certain monopolies arise among automobile dealers? Large dealers could sell several makes and decide on the prices, as if they had a monopoly. Prices would then increase.
The hon. member said that prices might go down, but it could also be the reverse. In the long term, prices might go up, because there would monopolies in the distribution and sale of motor vehicles or farm equipment. This could indeed be a danger in the long term and should be thoroughly examined.
It may be that remote areas need dealers selling several makes of cars or tractors. It might be a good thing in this case. However, would dealers selling several makes of cars or tractors be in a position to adequately service the vehicles bought by consumers for a rather large sum of money?
A farm tractor costing $100,000, $150,000 or $200,000 is a major investment. I think that consumers would be concerned if a dealer sold too many makes of tractors.
I can understand a dealer in a remote area saying that he will not survive if he can only sell one make of tractors. That may be the case. But then again, perhaps that dealer should have a smaller franchise that better reflects the size of the local market.
Again, I am not opposed to this idea, but I feel that this bill could cause major upheaval. The marketing structure that has been in place for many years works rather well and seems to meet the demands of consumers. Changing that structure could be quite risky.
It would also set a precedent. For example, suppose that a Saint-Hubert BBQ restaurant in Quebec does not do very well. Could the manager of that restaurant start selling burgers from McDonald's to improve sales?
If we agree to do that for motor vehicles, people in the food industry might want the same. When you think of it, a person becomes a dealer of his own free will. He signs an agreement with the maker of a car or farm tractor of his own accord, whereby he agrees to sell only certain models and makes.
In that sense, the current act gives a person the opportunity to choose the products he wants to sell. If, some day, that person realizes that the products he sells no longer meet his expectations, he can always sell his business to someone else.
Mr. Paul Steckle (Huron-Bruce, Lib.): Mr. Speaker, I am pleased to take part in the debate this evening on Bill C-221.
As a former machinery dealer and one who was involved in the industry for a good many years, I can tell the House that the bill has significant importance to me, as I believe it does for most of us in the House.
I am in complete support of this private member's bill as proposed by the hon. member for Lambton-Middlesex, which is a neighbouring riding to mine. I would like to commend my colleague for her efforts to amend the Competition Act.
The purpose of this bill is to put an end to a restriction in almost all franchise agreements that does not allow car or farm equipment dealers to sell a competitor's product. This practice is known as dualing.
As members will know, dealers are only allowed to display and sell the products of the manufacturer or distributor with which they have a franchise agreement because the agreement contains anti-dualing clauses.
In some cases the franchise agreement states that a dealer cannot dual without the written permission of the manufacturer. In practice such permission is rarely given. Franchise agreements can be cancelled and torn up by the manufacturer or the distributor if a dealer sells another line of products. For example, a John Deere dealer cannot sell New Holland tractors.
I have talked to the local farm equipment dealers having a part in those organizations over the years in my riding and in other areas of the province and country. They basically support this bill. They want to be able to sell more than one line of product.
Dealers with a franchise agreement are also required to invest large sums for facilities, equipment, personnel and training in order to provide the sales and servicing deemed necessary by the manufacturer. Sometimes the dealer's investment in inventory and overhead required by the manufacturer is more than economically practical, thus tying up funds that could potentially be used to sell and service a competitor's line if the dealer was allowed to do so.
In small rural areas it makes sense to offer variety. A Case IH dealer, for example, may not be able to go it alone but if allowed to combine with another product, could stay in business.
Franchise agreements with anti-dualing provisions are restrictive and should be trashed. Dealers are unable to provide their customers with the choice from more than one line and consumers are not given the advantage of being able to compare and chose between competing lines of product. This problem becomes more significant in communities and markets not big enough to justify a dealer making a large investment to sell only one line.
It is interesting and ironic to point out that franchise agreements with anti-dualing provisions are illegal in many American states such as Iowa, Missouri, New Hampshire and others. The threat of termination of an agreement is grounds for a civil suit in the U.S.
If American dealers have operated successfully for years without anti-dualing provisions, there is no justifiable reason whatsoever that Canadian manufacturers and distributors can argue to maintain them in this country. On top of that, many of these American companies, such farm equipment dealers, are allowed different products in the U.S., but these same dealers in Canada are not. This is a farce.
Canadian laws do not protect our car and farm equipment dealers from unfair franchise agreements. Current laws are not adequate in their terms or satisfactory in their enforcement to strike down anti-dualing provisions. Bill C-221 proposes an amendment to the Competition Act that will disallow anti-dualing provisions in franchise agreements. It will put us on a level playing field with the U.S. and help our small business people compete in our own markets.
Last year one automaker in Canada recognized that sales were plunging and agreed to allow its dealers to sell cars from other companies. Mazda Canada Incorporated was the first to do so, but others are sure to follow. Mazda had built a very large dealer network but it was not selling enough cars to justify it.
Today's market calls for diversification. Consumers will head to the dealer with the most selection. Competition is healthy. I believe it is the government's responsibility to provide a climate that will
end anti-dualing provisions in franchise agreements to allow dealers to sell products from competing manufacturers.
Manufacturers, distributors or suppliers can argue that scrapping anti-dualing rules is not the way to go. First, they may suggest dealer loyalty will be diluted if they are allowed to sell products from more than one producer. Dealer loyalty should be earned by a manufacturer, not forced or coerced by the threat of termination of an agreement. Imagine if a grocery store were only allowed to sell one brand of peanut butter.
Selling competing brands allows the consumer to choose. Again this is a capitalist system. This bill will strengthen and enhance the free market system.
Second, manufacturers may argue customer loyalty will be lost if dealers are selling products from competing manufacturers. I submit that customers will remain loyal to a dealer as long as they feel they are being dealt with fairly. I also submit a customer will remain loyal to a dealer that does offer them the choice of more than one product. Service and selection are the two main reasons for shopping for and buying any product, whether it is a car, a seed drill, a planter or a new suit.
Third, manufacturers may threaten to take away exclusive distribution of their parts from dealers. That is exactly what this is: a threat that could be used by a manufacturer against a dealer that takes legal action against anti-dualing provisions.
Fourth, a manufacturer may claim if anti-dualing is prohibited that a car or farm equipment dealer would or could become a monopoly supplier in the local market. But, on the other hand, is that not what a manufacturer is promoting if he argues that no other product line can be sold out of that dealership?
Another argument that could be brought forward if an end to anti-dualing practices is put into effect is that the number of dealers will decrease. However, we have to recognize that this is reality in today's marketplace. Companies are diversifying in order to survive. Today, as many MPs from rural areas will know, the farm equipment dealers are gone. There used to be five in the town of Dresden, a town of 2,800, and today there are no dealers left in that community.
In summary, Bill C-221 will allow for automotive and farm equipment dealers to sell products from competing manufacturers. This is diversification. The more selection dealers have to offer consumers, the more likely their businesses will prosper. The amendments in the bill are good for business and they are good for the consumer, who will benefit from more selection.
I applaud my colleague from Lambton-Middlesex for coming forward with this bill. She truly represents her constituents from her mainly rural riding in southwestern Ontario. As was mentioned last night during private member's hour on Bill C-201, partisan politics has no place during Private Members' Business.
I urge all members from all parties to support Bill C-221. It makes sense, it will enhance competition and it will put our small business entrepreneurs on a level playing field with those in the U.S. That is the direction in which we should be going.
The Deputy Speaker: I believe there are three or four members who wish to speak. Unfortunately, we are going to be short of time. I would ask members if they would be so kind as to keep their remarks a bit shorter than they might otherwise intend.
Mr. Werner Schmidt (Okanagan Centre, Ref.): Mr. Speaker, I will try to observe your request.
I would like to commend the intent which the hon. member for Lambton-Middlesex has presented in Bill C-221. The intent of trying to create more competition and providing a more competitive marketplace is a good idea. Some of the things which the hon. member is trying to achieve are laudable and worthwhile.
I certainly agree with the previous speaker that this is not a partisan issue. It is a good idea to observe that, especially when we are debating Private Members' Business.
I would like to look at this from the perspective of the principle of legislation. The legislation should be supported by principle. The principle which is involved in this legislation is that it should encourage and maintain competition and entrepreneurship, as well as providing a level playing field.
Another characteristic is that it should be enforceable. That means it has to be clear, it has to be reasonable and, of course, it has to enjoy general public support. Those are rather significant matters of principle which any bill should have.
I would like to briefly refer to the provisions in the current legislation. It is very interesting what section 77(2) states. It states that the the director of investigation and research can apply to the tribunal for an order prohibiting a supplier from continuing to engage in exclusive dealings, if the supplier is a major supplier or if the practice is widespread in the market, and if the practice of exclusive dealing is likely to impede entry into or expansion of a firm in a market, or to impede the introduction of a product into or expansion of a product sales in the market, or to have any other exclusionary effect on the market, and if as a result of the practice of exclusive dealing competition is or is likely to be lessened substantially, that is, in a major way.
I would respectfully suggest that the provisions in the current legislation are adequate. Their enforcement however is very inadequate. The hon. member in this legislation is trying to find a way to
have the provisions that are contained in the existing legislation enforced more equitably and a little more easily.
If that is the issue, then the bill goes too far. It applies exactly the same way as the bill is being proposed to urban situations where there are very dense centres of population and to areas where there is sparse population. The problems of doing business are different in a highly concentrated population centre as compared with a sparsely settled area.
The intent of her legislation would definitely appeal and apply to the sparsely settled population centre. I could not agree more. I am not sure however that the same universal application would be equally well supported in large cities like Edmonton, or Toronto, or Ottawa for that matter.
Perhaps the question is, should we not provide for a more effective enforcement mechanism of the current legislation? I do believe, and the hon. member for Huron-Bruce indicated this, that Mazda had recognized that they should allow dual lines to boost the sales of their Mazda line. It is great. It is wonderful. That is the kind of line that the market will provide.
The legislation should allow for that freedom to exist. Where that freedom is interfered with, the director under the existing Competition Act should be allowed to interfere. The reason why he does not interfere is not totally clear to me. In the background information the indication was made that resources are inadequate for the director to actually pursue these kinds of deviations from the intent of the law.
I would respectfully suggest to the House that the appropriate resources be made available to the director so that he or she can prosecute those people who are not meeting the intent of the legislation. We need to be very careful about that sort of thing.
Something else exists in the current legislation which I believe is very inadequate. I would like to refer to some of the notes that the hon. member did make available to my office, which I really appreciate. I would like to read this into the record: "The exclusive dealing provision of the act gives exclusive jurisdiction to the director to move against restrictions on competition such as those inherent in anti-dualing provisions".
That is correct. That exclusive prosecution capability ought to be included in the dealer's ability to go to the tribunal and alert them that there is a problem. I would agree.
Perhaps the amendment includes that. But the amendment would have been more appropriate if that could have been expanded so that dealers could do that.
The next paragraph goes on: "Therefore individual dealers whose businesses are injured by the restrictions contained in anti-dualing simply do not have the right to instigate proceedings". That is the point and I agree completely with it. I know the hon. member said the amendment does that but I am not quite convinced that it does. Section 77(2) or earlier sections which give the director that exclusive right have not been eliminated. Therefore a different set of litigation laws has to be appealed to in order to make happen what the hon. member suggested would happen.
Finally, to be really effective and fair, an amendment to the act should not only allow for enforcement action against anti-dualing provisions in franchise agreements but also should be framed in such a way that a dealer or a member of the public-we are adding the member of the public now-who is injured by the existence or enforcement of such provisions will have the right to take private action against the restrictive provisions.
Those are the kinds of things that I believe should be included in the amendment to the current Competition Act. I agree with that and support it.
I find myself not in opposition to the bill but suggesting that some changes could be made that would make it a little more effective and that would make a distinction between the sparsely populated centre versus the densely populated centre because the problems are different. I know the sparsely populated centres are the ones where the current anti-dualling provisions handicap the dealers tremendously. They do not do the kinds of things the member is trying to do with this bill. I agree completely with that.
Perhaps this will improve it a little. Maybe the next time we come at this we will have it put together the way we need it.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr. Speaker, it is indeed a great honour for me to support private member's Bill C-221 presented by my esteemed colleague from Lambton-Middlesex. The issue at hand is a grave one for many of my constituents. I will digress for a moment to respond to the member from the third party with regard to three of the observations he made.
The first is in relation to sparsity. The city I come from was so sparse that all the dealers left, that is 10,000. We must be careful when we talk about sparsity. What does sparsity mean? For people in rural Saskatchewan everything is fairly sparse. We have to ensure that dealers have a place and that they are protected.
Let me go one step further and consider a company like McDonald's. Anyone who competes against McDonald's wants to be located right next door because he likes the competition. Yet within the framework of these large companies they are telling the John Deere dealer not to move beyond the scope of John Deere.
People travel hundreds of miles to get parts and this dealer who is having trouble competing in the world around him adds one or two parts to provide that level of service, and they are prepared to see him lose his dealership. On the other hand if they were really competitive and open minded individuals they would say: "No, John Deere we want you to handle that and we want you to handle Case as well. If our machinery is the kind of machinery we say it is, ours will be selected over Case anyway". I appreciate what my
hon. friend from Huron-Bruce who was in that business had to offer on this very important topic.
With regard to the proposal in Bill C-221, the machinery dealers are now saying they are prepared to go along with the proposal on this type of thinking: "We will step in and allow you to sell combines, but we will not allow you to sell tractors". They are going to move in and add additional pressure on the people who are providing that service on their behalf.
I support the bill. I think the bill is well framed. We do have to look at it. The question was raised of why does somebody not move in and take some action against this inappropriate behaviour? That small dealer is not going to go against his company because his survival is based on that company's supporting him with that machinery. If he loses that line, he is out of business. In rural Saskatchewan when someone comes to pick up his machinery, he picks up his fuel, he picks up his food and he picks up his mail. It is another way to ensure that rural Saskatchewan, rural Manitoba and rural Canada in general will eventually die.
It is incumbent on all of us to do something as we speak on this very important private member's bill. Again I commend the member for Lambton-Middlesex for having the courage to come forward and say there is something in this private member's bill that we want everyone to look at. The time has come for us to set aside our personal feelings and ask: Is it good for Canada? Is it good for rural Canada? Is it good for all of us? Can we support it? In my opinion, we can support it and we will support it.
I sincerely thank my friend opposite for allowing me the privilege of taking part in this very serious discussion. I look forward to the statements from my fellow MPs from Saskatchewan.
Mr. Len Taylor (The Battlefords-Meadow Lake, NDP): Mr. Speaker, I appreciate the opportunity to speak on this important private members' initiative.
I too wish to congratulate the member for Lambton-Middlesex for her dedication to this issue. She and her office have worked diligently with some in the industry to achieve a goal. I am very happy to spend time in support of her work.
I was very pleased to hear the interventions of the other members this afternoon which indicated that there is a great need to make changes in the Competition Act to support the communities we represent and the economy of our country. At the same time, the debate indicates there is considerable support for the bill and the ideas that go along with strengthening the bill.
The member for Huron-Bruce gave us a good indication about what someone from within the industry thinks of the need for the bill. I was grateful for his intervention because it strengthened my confidence in the overall outlook on the bill.
For the benefit of those who are hearing about this for the first time, Bill C-221 is an act to amend the Competition Act, which creates an offence for manufacturers and distributors of motor vehicles and farm equipment to engage in certain marketing practices with their dealers. In virtually all cases, franchise agreements provide that a dealer shall not carry any other line or "dual" without the written permission of the manufacturer. In practice we know that permission is rarely forthcoming.
I come from a farming area in northern Saskatchewan where the communities are very small. The people who farm in those communities have great distances to travel for their support. In the past, farm dealers have driven throughout our area as they do in other parts of Canada. Over the years, the economics of rural Canada with a sparse population with decreasing incomes from the farm have led to a lot of changes in the way in which the agriculture industry is serviced. Where we once had many dealers, we now have a handful.
It makes it very difficult because there are many different product lines and there is a lot of loyalty to the original product lines on the farms scattered throughout northwest Saskatchewan and elsewhere. Fewer dealers and a great number of product lines results in many farmers finding it difficult to obtain the parts and service for the equipment they originally bought.
This private members' initiative gives the opportunity to some of the dealers currently carrying single product lines to recognize, understand and support the marketplace within their area. Many different product lines are not able to be serviced under the current arrangements. It would be marvellous if the local single product line dealer in one community could provide parts and service for many of the product lines that exist within that dealer's community. It would be of great benefit to the whole region.
At the same time, there might be an opportunity for new dealerships to open their doors, servicing not just one product line but several product lines. They could service the entire community. Rural Saskatchewan, particularly the remote rural part where several members of this House come from, is currently so underserviced by the equipment dealers.
I am very proud of the equipment dealers that currently function within northwest Saskatchewan and Saskatchewan in general. They have had a very difficult time throughout the past 10 years with the decline in farm prices. They have stuck with their communities and they work hard in them. Quite often they and their staff volunteer their time in the communities for everything from coaching minor hockey and baseball through to calling some of the church bingos that still exist throughout the riding. I am very grateful that those people are able to contribute to the communities in the way they do. This legislation offers greater opportunities for those people to remain in our communities and for others like them to find themselves there as well.
I do not want to go on at great length because there are others who wish to speak to this bill. The restrictions that have been put in place have certainly increased costs and reduced availability within the marketplace. I hope that this bill has the support of the members of the House.
The member for Lambton-Middlesex has certainly done her homework with regard to this bill. She has talked to everyone in the industry from the Ontario Farm Implements Dealers Association through to dealers across Canada. I know they have contacted her because some of them from Saskatchewan have contacted me asking to whom they can direct some of their information, concerns and support.
I am also aware that the Minister of Industry has tried to address this issue through the competitions bureau and that earlier this year the competitions bureau was to hold hearings and should have reported on this. I would have been happier to be standing here today supporting a government bill that I knew was going through all three readings in this House and that I could vote in favour of to ensure that with government support the legislation would go through and this would have full government support.
In the absence of government support and in the absence of a bill presented by the Minister of Industry, I am very happy to be able to stand today and support the private member's initiative by the member for Lambton-Middlesex. As I said earlier, I commend the bill to the House. I would hope that members of the House will find it in their power to put some pressure on the government to see that this type of legislation finds its way into reality.
The member's diligence, dedication and hard work in this regard should have its rewards. I only hope that they are forthcoming.
Mr. Morris Bodnar (Parliamentary Secretary to Minister of Industry, Minister for the Atlantic Canada Opportunities Agency and Minister of Western Economic Diversification, Lib.): Mr. Speaker, it is my pleasure to speak on private member's Bill C-221 as introduced by my colleague representing the riding of
Lambton-Middlesex. I congratulate and thank my colleague for the work and research she has put into this bill.
This bill proposes to amend the Competition Act by making it a criminal offence to prohibit manufacturers and distributors of motor vehicles and farm equipment from engaging in certain marketing practices with their dealers.
As I understand it, the purpose of the bill is to improve the efficiency of dealer operations. The view has been expressed by my colleague that restrictive arrangements between manufacturers and dealers prohibiting the the practice of dualling may result in inefficiencies for dealers in the sales and servicing of motor vehicles and farm equipment.
The objective of increasing efficiencies is a valid one in the context of competition legislation. Promoting efficiency and adaptability of the Canadian economy is specifically cited at section 1.1, the purpose clause of the act, as one of the principle purposes of the legislation. The provisions of the Competition Act have been created with this objective in mind.
The second objective addressed in Bill C-221 is to protect and encourage franchise dealers operating throughout the country by allowing them greater opportunity to realize gains in efficiency in their operations. Small and medium size businesses are at the very heart of our country and their success is key to the growth of the Canadian economy.
Accordingly, this objective is equally as important and noteworthy and is also recognized in existing competition legislation. It is recognized throughout the specific provisions of the Competition Act, which have been created with this purpose in mind, and more specifically in the purpose clause which provides that the purpose of the act is to ensure that small and medium size enterprises have an equitable opportunity to participate in the Canadian economy.
While the objective of the proposed legislation to control the anti-competitive consequences of prohibitions against dualling is worthwhile and should be supported and encouraged, the proposed bill is not the most appropriate for ensuring this objective.
A provision which addresses the very same objectives and conduct as the proposed bill attempts to address can already be found in section 77 of the act. This section deals with the issues of exclusive dealing. In order to understand why the existing provisions are more appropriate than those found in Bill C-221 to address the conduct complained of, it is important to consider the Competition Act and the structure under which it has been created.
The current legislation is a framework law of general application. It applies with some notable exceptions to all sectors of the Canadian economy, namely manufacturing, resources and services. The law touches on the everyday life of all Canadians by maintaining and encouraging competition in the marketplace with the objective of providing consumers with competitive prices and a variety of choices in the goods and services they buy.
Competition policy is a fundamental element in the government's economic framework aimed at fostering efficiency, adaptability, innovation and growth in the Canadian economy.
Bill C-221 would create criminal offences punishable on summary conviction or on indictment with the possibility of a fine in the discretion of the court or imprisonment for a term of up to five years. It is important to remember that criminal law is a powerful legislative tool, one that ought to be used with restraint.
In particular, this is a legislative tool that ought to be invoked in limited circumstances. It should be invoked in respect of conduct that gives rise to clear, serious harm and in respect of types of conduct that are likely to be harmful across a wide variety of economic conditions and business circumstances.
This is why the Competition Act has been drafted to include both criminal prohibitions and civil reviewable matters. Criminal law should be reserved for the most serious acts where it is clear that a particular conduct should be outlawed. Offences of the act which fall into this category include conspiracy and bid rigging.
On the other hand, the Competition Act contains other matters which are not criminal prohibitions but are categorized under the legislation as matters that may be reviewed by the competition tribunal, an administrative body under a civil standard of proof.
The tribunal may make remedial orders to overcome the effects of such practices but penal consequences are not imposed for a violation of these provisions.
Bill C-221 would create an absolute prohibition and declare certain conduct undesirable in all circumstances without recognizing that circumstances may equally exist which would make the conduct pro-competitive or competitively neutral.
This issue will certainly be raised in committee when we discuss the amendments to the Competition Act once they are introduced.
The Deputy Speaker: The hour provided for the consideration of private members' business has now expired and this item is dropped from the Order Paper.
A motion to adjourn the House under Standing Order 38 deemed to have been moved.

Adjournment Proceedings
Mrs. Maud Debien (Laval East, BQ): Mr. Speaker, in this House, on March 13, I questioned the President of the Treasury Board about his intention to establish a Canadian securities commission. I pointed out to the minister that the various provincial securities commissions were already busy setting up the system for electronic document analysis and retrieval, commonly known as SEDAR. This new system, which should be operational in a few months, will ensure a true integration of financial markets. The funniest part of it is that the minister seemed totally unaware of the very existence of the system.
On this issue as on many others, the federal government is showing that good intentions do not necessarily give good results.
The Bloc Quebecois understands that a degree of harmonization is required between the various provincial commissions for the sake of efficiency and effectiveness. The private sector also came to that conclusion, and that is why, in a very near future, SEDAR will make the issue of securities easier between provinces.
The system that the federal government intends to establish, on the other hand, has nothing to do with wanting to simplify the process; chances are it is yet another attempt at centralizing and interfering. The idea is not new, by the way. Aggressive action to create a Canada-wide securities commission was undertaken as early as in 1964 by a royal commission. In 1979, another attempt was devised in the form of a draft bill. Finally, less than three years ago, the premiers of the maritime provinces also called for the establishment of a Canadian securities commission.
As is its custom, the federal government is once again duplicating what the provinces are already doing, without worrying about costs or effectiveness. To add insult to injury, it wants to interfere in an area in which the private sector is about to harmonize the rules in co-operation with the other provinces. Federal-provincial overlap? Totally out of the question, Mr. Speaker.
At a time when socio-economic stakeholders in Montreal deplore the serious economic problems plaguing Quebec's largest city, the federal government is once again trying to steer financial operations toward Toronto. Brokers, lawyers, accountants in the financial sector might be forced to leave Montreal for Toronto.
This is the effect the creation of a Canadian securities commission would have, by centralizing financial activity on that Ontario metropolis. It is not, moreover, mere happenstance that the English speaking provinces, and Ottawa, are trying to isolate Quebec and to force its commission to be subservient to the Canadian one.
The government must put an end right now to its centralist plans for the Montreal region, which are prejudicial to that region. Let us keep in mind that, only days ago in the throne speech, the federal government announced its intention to face up to the realities of the 20th century, and to withdraw from areas of provincial jurisdiction as much as possible.
Now, only a few days later, it makes a complete about face and wants to interfere in an area where the provinces and the private sector are managing very well.
We see clearly what is going on now; those old ghosts of centralization are still haunting this House.
Barry Campbell: Mr. Speaker, the hon. member has asked a question about the system for electronic document analysis and retrieval, or SEDAR.
It would perhaps be useful to tell the House what SEDAR does. SEDAR makes it possible to transmit documents electronically to securities commissions and to create an electronic data base accessible to the public.
Rather than being mailed to each of the provincial administrations, as is now the case, documents would go out once electronically. For us and for those involved in the securities market, this is clearly a welcome measure. In fact, if we were to set up a Canadian securities commission, SEDAR would be an essential part of it.
With the advent of SEDAR, the Canadian securities commission is not superseded. In itself, SEDAR does not eliminate the overlap in the present securities regulation system in Canada. It does not solve the problem of approving prospectuses and registering brokers. The approval of at least 12 regulating bodies is still required.
It does not eliminate the inconsistencies in the application of provincial rules, the discrepancies in execution, or the time and effort necessary to co-ordinate the policies of provincial administrations.
The commission would promote the effective application of regulation and improve access to Canadian financial markets. As financial markets are increasingly linked to foreign markets, we must increase the efficiency of our markets in order for our businesses to be competitive.
The Deputy Speaker: The motion to adjourn the House is now deemed to have been adopted. Accordingly, the House stands adjourned until tomorrow at 10 a.m.
(The House adjourned at 7.26 p.m.)