2002-04-26

[Stage Direction]
The House resumed from April 24 consideration of the motion that Bill C-50, an act to amend certain acts as a result of the accession of the People's Republic of China to the agreement establishing the World Trade Organization, be read the third time and passed.
Mr. Darrel Stinson (Okanagan--Shuswap, Canadian Alliance): Mr. Speaker, the House is considering putting in place a complex system for Canadian manufacturers of goods in order to lodge formal complaints if they believe they are receiving unfair competition from imports of similar goods made in the People's Republic of China. It is called Bill C-50.
How do my hon. colleagues think there could be fair competition between Canada and China, where workers' rights and job safety are far behind that of Canada, where child labour is still widespread, where permits and regulatory control are routinely bypassed by means of graft and corruption of government officials, and where environmental protection is far behind that of Canada?
Long time foreign service representative to China, Mr. Brian McAdam, described China as a climate of corruption. I wish to thank him for the input he has made to some of the questions I put forward to him, it was very insightful.
The American chamber of commerce in China has stated that the average industrial wage in China is about $4 an hour. Literally nobody in Canada makes such a low wage. How can the government expect our companies and our people to compete against such a system?
All of the above factors mean that a company in Canada, where workers have many rights, where child labour is no longer practised and has not been for years, where job safety is a major concern of everyone, and where environmental protection and regulations like building codes are taken seriously, would find it more costly to produce an item than a similar company in China.
One of the biggest differences is that prison labour is a fact of life in China. No matter what we like to think here or where we hope this goes, prison labour is a way of life in China. There are millions in prison for being pregnant without permission, shouting “Free Tibet”, working for women's rights, seeking religious freedoms to practice Falun Gong, and protesting the lack of investigation of the tragic events of the Tiananmen Square massacre which took place on the night of June 3 to June 4, 1989. That still has not been addressed to the satisfaction of the world stage.
Amnesty International has provided me with the following information:

Torture has been reported in the full range of state institutions, from police stations, detention centres and prisons to administrative “re-education through labour” camps and enforced drug rehabilitation centres. It has also been inflicted by officials working outside the criminal justice system, sometimes publicly, to humiliate, threaten or coerce. Methods of torture include severe beating, kicking, electric shocks, hanging by the arms, shackling in painful positions, exposure to extreme heat or cold, sleep and food deprivation.
Prison conditions are harsh, often with long hours of forced labour and inadequate medical care. Some dissidents not known to have psychiatric problems have been sent to psychiatric institutions where they have been forcibly injected with drugs. Reports of torture increase during periodic "strike hard" campaigns against specific crimes and during high-profile political campaigns like the current crackdown on the banned Falun Gong organization.Groups at particular risk include ordinary criminal suspects and migrant workers, religious and ethnic minorities, labour activists and political dissidents.

If this is what is going into in the agreement, I have to wonder what we are really doing here.
We all know that under Chinese law torture is prohibited in most circumstances. China has been called before the world stage a number of times with regard to these issues.
This is from Amnesty International's backgrounder: Jigme Sangpo has spent most of the past 40 years behind bars. He was first arrested in 1960 and sent to a re-education camp for allegedly subjecting the students to corporal punishment. He was arrested again in 1970 and sentenced to 10 years for his political activities. His latest period of detention began in 1983 when he was given a 15 year sentence for spreading counterrevolutionary propaganda after he put up a wall poster calling for Tibetan independence. The sentence was extended for five years in 1988 after he shouted slogans and a further eight years in 1991 after he shouted “Free Tibet” during a visit to the prison by the Swiss ambassador to China.
I have to wonder exactly where we are going. According to Amnesty International, at least 2,960 people have been sentenced to death and 1,781 executed in the last three months of China's strike hard campaign against crime. Amnesty International said today that more people were executed in China in the last three months than in the world for the last three years.
When we go into these types of agreements we should be looking very closely at the practices in these other countries. I do not want anybody here to get the idea that I am against free fair trade. I want to emphasize the word fair, fair not only in the marketplace but also fair to the people of the country with which we are willing to do business.
I have to wonder what is going on when we go into these agreements and these issues are not addressed. We like to stand here and say that if we do this, maybe the country of concern will come to the same understanding for their people as we do here in Canada. To me the word maybe is a big gamble.
I especially have to wonder when, in all sincerity, our trade with China is actually a deficit. We import approximately $10.5 billion from China yet we export a very small fraction of that. When we do this with a country whose movements against the Falun Gong, Protestants, Catholics and other religious groups and its lack of commitment to internationally agreed upon standards for human rights, one would think that all of us in the House should be concerned, especially when we consider the fact that our trade with China is so relatively small.
I have to wonder if our speed on this might have something to do with the fact that the Prime Minister's son-in-law is the chairman of the Canada-China Trade Council. Probably the largest company in China with any interest in China at all is the Power Corporation and it also has ties.
The government members are proud of saying that they support human rights. They like to stand up and say that they are caring and sharing and that they will not support regimes in one place or another that impact upon human rights, workers' rights, religious freedoms and free speech, and yet we still go down this road without those things being addressed, which causes me grave concerns.
The idea of a country the size of Canada, with a population of approximately 32 million, trading with a country with a population of over 1.5 billion people, should in all cases open up doors for trade expansion in Canada. Unfortunately, when we look at the reality, the country to which we will be opening our doors and competing against is a country that still believes in forced child labour and still practices forced prison labour, which puts our companies in dire straits for competition in the marketplace. Instead of waiting to address some of these issues, they should have been addressed before we went there.
I want everyone in the House to understand that there is nothing wrong with trade as long as it is free and fair. When practices, such as those that go on in China today, are not perceived as being free or fair, particularly as compared to our standard of living, I have to question the wisdom of where we are going.
Mr. Pat O'Brien (Parliamentary Secretary to the Minister for International Trade, Lib.): Mr. Speaker, I listened in amazement to the hon. member and his conspiracy theory about why Canada is involved in trading with the most populace country in the world. It is unbelievable.
Yesterday his colleague from Calgary made similar silly accusations and charges. Quite frankly this displays an incredible ignorance of Canadian foreign policy.
Canada has had a one China policy since the days of the Trudeau government, through the Mulroney government of a different political stripe, and now on to the current government. To say that this is somehow driven because of some business connection the Prime Minister's son-in-law has in China or something, just boggles the imagination. It is an Alice in Wonderland kind of thinking.
Does the hon. member not know that Canada does not have diplomatic relations with Taiwan, does not recognize the Republic of China? Does the hon. member not realize that whether he likes it or not or whether I like it or not, and I do support it, China is now a member of the WTO? It has acceded to the WTO, as has Taiwan.
If we are going to continue trade with China and Taiwan, we must accept that reality. We must bring into line certain acts in order for us to accept the reality that China is now a member of the WTO. The member speaks as if he can somehow hold back the Chinese horde from getting into the WTO. He has to wake up and realize that China is a member of the WTO now. Does he not understand that?
Darrel Stinson: Mr. Speaker, I understand that very well. I also understand that the WTO does not force any country to trade with another country. That is strictly up to the government of the day. If the government perceives that practices going on in that country are up to its standards, which I gather they are according to this government, then there is absolutely no problem trading with China.
However if the government refuses to recognize that there are problems in these countries and does not address them, and it is willing to put our companies into unfair competition due to the practices in these countries, then that is the government's right.
However, whether the member likes it or not, one of my rights and the reason I was sent here was to raise concerns like these in the House. If I have information pertaining to activities going on in other countries, particularly with regard to trade issues such as this, it should be brought to the government's attention in one way or another. The member may not like that but I believe that is my duty, not only to my constituents, but to Canada as a whole.
Mr. Dick Proctor (Palliser, NDP): Mr. Speaker, earlier in the member's remarks he expressed some concern about the fact that in China the salaries paid are as low as $4 an hour. The member wondered how we could compete against those wages.
I would remind the member that when Canada entered into the North American Free Trade Agreement we were and are competing with Mexico which has a similar wage rate. I do not know the exact wage rates but they certainly are below our standards.
One of the reasons that we in this party have been opposed to that is because there are insufficient environmental and labour law protections in agreements like the North American Free Trade Agreement and the World Trade Organization.
Why does the member's party not insist on having those kinds of rules and regulations in place before we get into these kinds of agreements with countries that have substandard laws, rules and regulations in contrast to our own?
Darrel Stinson: Mr. Speaker, I would like to thank the member for his question. Our party does not oppose that, not at all. We would like to see it in every agreement. It is nice to stand up here and say that we have free and fair trade but we should get it straight in peoples' minds that there is no such thing as free. There is trade, yes, but if we want a level playing field, and our party has always stated this, we must have the same conditions. We cannot expect to compete against a wage of $4 an hour, which is not necessarily the low wage in China but probably the higher wage, extremely high. I used the $4 example because people can understand it better than $1.25 or $1, which would probably fit better into the category of China.
We believe that if we are to go into these agreements we should all have the same type of playing field. Until such time as we do, we will always have unfair trade practices, whether it be child labour or things such as the Kyoto accord, which the member's party gives great support to without looking at what the impact would be on the monetary system and on our own companies here in Canada. Yet we will blindly rush through and blindly say this is what we will do when other countries are not signing on to that accord and do not have to come up to anywhere near the same standards while they pollute just as much or worse than Canada does.
All this plays into affecting trade, into whether or not companies will make a profit and whether or not they can compete on the world stage. When we put restrictions in place and decide to do this against the companies here in Canada, how on earth can we expect to prosper on the world stage? How can we be expected to compete in this situation?
I do not know of anyone who goes into business, particularly when competing in the world market, who says they will go into business but fine, penalize them five times the points that the competition will be. They just do not do that. Most people, when they invest in companies or when companies start up, have an understanding of what the agreement is at the time they make their investment. They know through their own calculations before they do this whether or not they will make a profit in a year or two. Then the government comes along and decides they have to compete against companies that perhaps have to pay only one-third or one-fifth the wage and do not have to live up to the same environmental standards or pay the same taxes as they do. The government says they will have to compete with them because it signed these agreements, without these issues being addressed properly.
Let me say again that I am not against trade. Fair trade would be really nice, if we ever had such a thing in this country, which we do not seem to have. For example, the United States, which has a lot of the same standards we do and some that are superior to ours, has a taxation level so much lower than ours that our companies have a terrible time trying to compete. Its bureaucracy and its red tape are so much easier to get through than ours.
This all pertains to trade in the world, but our government, and particularly this Liberal government, turns a blind eye to all of these facts. It turns a blind eye to the bankruptcies of people and companies who are trying to compete out there. The government just keeps wanting to put more restrictions in place. I have to wonder exactly where the government is coming from and where it is going.
There are a lot of people, including me, who are hopeful that through this agreement more light will be shed upon the practices in China. If that is truly the case maybe a lot of these concerns can be addressed, but I want to stress that maybe part of it. I have seen the government so often use the terms maybe and if. Both are hypothetical. I would like to know if the government were to review this in a few years whether it would back away from it. I highly doubt it. It seems that once it gets these practices in place it likes to penalize our business people as much as possible.
In closing, I have one word for the government. The government's fear is a fear of the independent business people of the country, for if they are independent they do not need--
The Speaker: The hon. member for Verchères--Les-Patriotes.
Mr. Stéphane Bergeron (Verchères--Les-Patriotes, BQ): Mr. Speaker, having listened to the debate for a short while, I found it pretty heavy going, kind of depressing.
So I had the idea, if only to lighten things up for a few moments, to share with you a little discussion I had with my staff this morning, when I learned that today was the day I was to speak on Bill C-50, concerning accession of the People's Republic of China to the World Trade Organization. I will share with you the contents of my favourite cartoon strip.
This is something I have had for some years and like to bring out from time to time. When I am feeling low, I look at it and it cheers me up.
It is taken from the comic strip Philomène , which is called Nancy and Sluggo in English. We see her standing at the front of the class. She has a little paper in her hand and she is announcing to the class “Today, my five minute report is on China. Its title is ‘China: a five minute report’”. In the next frame we see Philomène looking at her watch. Her thoughts are shown. “Oh oh, I'm in trouble”. She realizes that just saying “Today, my five minute report is on China. Its title is ‘China: a five minute report’” is not going to take up her five minutes.
Funnily enough, my favourite comic strip is about a speech on China, and today I have to talk for twenty minutes about the accession of the People's Republic of China to the World Trade Organization.
That said, let us get back to the heart of the issue. I think that we must conclude, or at least point out, having heard the speech by my colleague from the Canadian Alliance, that we must face up to reality. Facing up to reality means acknowledging that Canada and China entered into a bilateral agreement in November 1999 on freer trade between the two countries.
Facing up to reality means considering and acknowledging the fact that, since 1986, China has manifested its intention to join the WTO. Since then, it has negotiated bilateral agreements with some forty WTO members, Canada among them. The provisions of these bilateral agreements apply to other WTO members by virtue of the most favoured nation criterion.
It must be noted also that, for all intents and purposes, China is already a member of the WTO pursuant to the protocol on the accession of the People's Republic of China to the World Trade Organization that came into effect on December 11, 2001. Consequently, Canada has no choice but to adapt its legislation, and I will explain why in a few moments. Normally, Canada does not have to adapt its legislation when a new country joins the World Trade Organization, but it must do so in the case of China, and I will come back to that shortly. Perhaps this will respond to some of the concerns expressed by our colleague from the Canadian Alliance. Facing up to reality means adapting our legislation accordingly.
Our colleague from the Canadian Alliance was saying that we do not necessarily have to initiate trade relations with a country just because that country belongs to the World Trade Organization. The Government of Canada can decide not to trade with a country such as the People's Republic of China.
With all due respect, I would tell my colleague from the Canadian Alliance, who claims to put the private sector at the centre of our economic system and to be in favour of free trade, that it is not for the government to determine whether or not a Canadian business wants to trade with China.
It is for Canadian or Quebec businesses to decide whether they want to trade with the People's Republic of China, whether or not that country is a member of the World Trade Organization. It is not for the government to decide, unless there is a political decision on the part of the government to boycott a particular country. However, I do not think there is any plan to boycott the People's Republic of China at this time.
If the Alliance member is suggesting in any way that the government should boycott the People's Republic of China, I think he should have informed the House of his view, since it would be a rather spectacular and drastic measure that would be a radical departure from what has been Canada's approach with regard to the People's Republic of China over the last few years.
I would like to say a few words about the People's Republic of China. Admittedly, this is not one of the most democratic countries in the world. With the reports of organizations like Amnesty International, we realize that human rights violations actually do occur in the People's Republic of China.
However, we should also realize that the People's Republic of China represents one fifth of the world population. Is it really possible to isolate from the rest of the world one fifth of the population of the planet simply because it does not have a democratic system and because there are human rights violations there?
Democracies are a tiny minority in the world. Does this mean that the free and democratic nations should live just among themselves, and let the rest of the world fend for itself? No, this is not the philosophy of Canada, nor is it the philosophy of Quebec.
A number of years ago, we realized that the development of democracy was closely linked to economic development. This is why, many years ago, Canada and all developed countries set up and maintained development assistance programs and international cooperation programs, so that all the countries we used to call third world countries, and which we now call, more appropriately, developing countries, could set out with determination on the road to both economic and democratic development, and eventually become countries living under the rule of law, totally democratic and respectful of human rights. I think the market economy certainly contributes to economic, human, and democratic development.
The remarks of the Canadian Alliance member make this important philosophical debate unavoidable. How should democratic nations like Canada respond to autocratic nations, to nations that do not have as much respect for human rights and are therefore, on this score, developing nations?
Must we, as we did specifically in the case of South Africa, take a hard line, a policy by which we will totally isolate these states on the economic and political level? Or will we choose, as we did in the case of most developing states in the world, the way of co-operation and trade relations, to lead these countries down the road to economic, democratic et human development?
While we must recognize that, in the case of South Africa, the situation was quite out of the ordinary, I would say that we chose, several years ago, to promote open relations and to establish as many links as possible with these countries, to lead them down the road to development.
It must also be recognized that the People's Republic of China is Canada's fourth largest trade partner. Its trade with Canada reached $15 billion in 2000. It must be recognized that the People's Republic of China is the seventh most powerful economy in the world and the ninth largest exporter.
This means that we cannot indefinitely isolate states such as the People's Republic of China, and many other states around the world, which have a system that is more autocratic or less open to human development and other aspects. I think that is what accession of the People's Republic of China to the World Trade Organization finally recognizes.
Our colleague of the Alliance was saying “Yes, but they have minimal working conditions and their production costs are much lower that those in Canada. Consequently, we are not on the same level, we will not benefit from the same conditions. China will therefore have the advantage and will be able to sell on the Canadian market similar goods that it will have produced at much lower costs, thus outdoing Canadian goods and the Canadian businesses that produce them”.
This is indeed a legitimate concern, if ever there was one. However, we must realize that the members of the World Trade Organization have also faced up to this reality, that China does not currently have a market economy, and that production costs in China are definitely lower than just about anywhere else in the world. Working conditions are also lower.
This has been acknowledged. Consequently, specific protections were included in the accord on China's accession to the WTO and, as a result, we now have to incorporate them into Canadian legislation. These protective measures are temporary, but they will allow Canada and other WTO members to protect their markets during the transtion period.
The bill before us today, Bill C-50, deals with China's accession to the World Trade Organization. The bill amends some Canadian legislation, including the Canadian International Trade Tribunal Act and the Export and Import Permits Act, to allow the government to apply, if need be, the protective measures set out in the accord on China's accession to the World Trade Organization.
Bill C-50 also amends the Special Import Measures Act to include provisions in Canadian statutes regarding anti-dumping investigations provided for in the accord on China's accession to the WTO.
In practical terms, three guarantees would be added. There are three guarantees set out in the treaty on China's accession to the WTO. There is what is known as a guarantee per product, which may be applied to any product originating from the People's Republic of China that impacts or threatens to impact Canadian industry negatively because of increased imports of Chinese goods produced at a lower cost than on the Canadian market.
There is a guarantee of diversion, which can be used to prevent Chinese products that have been denied access to markets by reason of a guarantee per product from flooding the Canadian market, thereby having a negative impact our industry.
I think that the guarantee of diversion has taken on a new significance in the last few weeks when, for example, the United States decided to apply safeguard measures to prevent the importation of steel into their market. Canada could have become some sort of outlet for steel products meant for the United States, and these products could have ended on our Canadian market or elsewhere. This is exactly the type of situation we want to prevent with the guarantee of diversion.
For example, if a country applies safeguard measures, invoking the guarantee per product to keep products originating in the People's Republic of China from entering its market, a neighbouring country can invoke the guarantee of diversion to prevent those Chinese products being denied access to the first country from flooding its market, in this case the Canadian market.
There is a third special guarantee that applies to clothing and textile imports from China. To respond to the concerns of our colleague from the Canadian Alliance, I must say that there are provisions in the treaty on the accession of the People's Republic of China to the World Trade Organization that will become part of Canadian legislation pursuant to Bill C-50. There are guarantees that actually allow us to protect the Canadian market against the unfair competition feared by our colleague from the Alliance because of the present economic conditions in the People's Republic of China.
Let me come back briefly to the philosophical debate I mentioned earlier. We are having this debate in the House today because of some comments by our Canadian Alliance colleague, who has once again brought up the whole issue of the appropriateness of opening our arms to countries whose the system is much less democratic than ours, where there is no market based economy or whatever else.
This is a recurring issue. I remember that there was a debate very recently at the Inter-Parliamentary Union as to whether we should admit the Shoura, which is the consultative council of Saudi Arabia—I am not using the expression legislative council, because it is a little hard to determine whether the Shoura does indeed meet the definition of a parliament in legislative terms. So, the Inter-Parliamentary Union wondered whether it should admit the Shoura as one of its members.
This debate was also going on. Some were saying “Human rights are being violated in Saudi Arabia. That country is not a democratic state. Members of the Shoura are not elected; they are appointed by the king. They can be removed at the king's pleasure. They are not called upon to oppose legislation that the king might want to enact. Why should we let it join the Inter-Parliamentary Union?”
Then, there were those who were saying “If we want Saudi Arabia's legislative system to eventually include women as members of the Shoura, to eventually have members elected to that council and to ensure that these members are not at the mercy of an autocratic ruler, if we really want to lead Saudi Arabia down the road to a more democratic system, even though it must be recognized that the Shoura has already made a lot progress in a fairly short period of time, in terms of the number of its members of various origins in Saudi society, then this is what must be done”.
This was the other view that was expressed. Both of these views are very relevant and legitimate. Ultimately, we must go back to the fundamental question that I raised earlier. In fact, is the best way to lead these countries down the road to democracy, human development and democratic development, not to share our experience with them and ensure that these countries are more open and eventually adopt ways of doing things that are similar to ours?
I will conclude by touching briefly on the issues of human rights and economic development. China's accession to the World Trade Organization and the implementation bill before the House today will not be enough to change the mindset and the economic and political system of the Chinese people.
We will have to continue putting pressure on the Chinese authorities to move toward freer trade, democracy and better human rights. We will have to support human development and international co-operation in China and throughout the world.
Therefore, I urge the government to recommit to the international objective, which is to set aside 0.7% of our gross domestic product for international development. Because of the government cuts, the development assistance budget has gone from 0.46% in 1992 to 0.25%. The increases announced recently would only raise it to 0.27%.
We must urge the government to step up its efforts to reach the objective of 0.7% of our GDP.
The Speaker: Is the House ready for the question?
[Intervention]
Some hon. members: Question.
The Speaker: The question is on the motion. Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
(Motion agreed to, bill read the third time and passed)
[Stage Direction]
The House proceeded to the consideration of Bill C-47, an act respecting the taxation of spirits, wine and tobacco and the treatment of ships' stores, as reported (with amendment) from the committee.
Hon. Elinor Caplan (Minister of National Revenue, Lib.): 
moved that the bill, as amended, be concurred in.

The Speaker: Is it the pleasure of the House to adopt the motion?
[Intervention]
Some hon. members: Agreed.
(Motion agreed to)
The Speaker: When shall the bill be read the third time? By leave, now?
[Intervention]
Some hon. members: Agreed.
Elinor Caplan: 
moved that the bill be read the third time and passed.

Mr. Bryon Wilfert (Parliamentary Secretary to the Minister of Finance, Lib.): Mr. Speaker, I appreciate the opportunity to speak at third reading to Bill C-47 which introduces a modern legislative and administrative framework for the taxation of spirits, wine and tobacco products under the Excise Act.
The measures in the bill address a long-standing need of both industry and government for a new excise framework. As many colleagues are aware, the Excise Act is the foundation of the federal commodity taxation system for alcohol and tobacco products. It would impose excise duties on spirits, beer and tobacco products manufactured in Canada. It would include extensive control provisions relating to the production and distribution of these products.
Commodity taxes are an important element of Canada's federal tax system. In 2000-01, for example, duties and taxes on alcohol and tobacco products raised about $3.4 billion in federal revenues. The Excise Act is one of the oldest taxing statutes in Canada. Some of its provisions date back to the 1800s and except for periodic amendments the act has never been thoroughly reviewed and overhauled. In recent years it became obvious to both industry and government that the excise framework needed to be modernized.
Industry, for example, has introduced new technology and product marketing and distribution initiatives that the existing Excise Act is not equipped to accommodate. The base of controls in the act impose high compliance costs on industry and impair the competitiveness of Canadian producers. Given the increased foreign competition in Canadian markets for beverage and non-beverage alcohol this problem needs to be addressed.
From the government's perspective the Excise Act is increasingly difficult to administer and impedes the ability of the Canada Customs and Revenue Agency, CCRA, to fully adopt modern administrative practices. Furthermore, wine which is currently taxed under the Excise Tax Act is not subject to any substantive controls on its production and possession. Tobacco manufactured in Canada is taxed under both the Excise Act and Excise Tax Act. This creates problems both for industry and government.
All of these factors point to the need for a revised excise framework which is a key component of Bill C-47. The new excise framework is a direct result of a discussion paper on the Excise Act review which the Department of Finance and CCRA released in 1997. That paper outlined a proposal to provide legislative and administrative framework for the federal taxation of alcohol and tobacco products.
The government subsequently released draft legislation and regulations in 1999 and held public consultations with all major stakeholders. During the review the government was guided by three goals: first, to provide a modern legislative framework for simpler and more certain administrative systems that recognize current industry practices; second, to facilitate greater efficiency and fairness for all the parties leading to improved administration and reduced compliance costs; and third, to ensure the continued protection of federal excise revenues.
Bill C-47 meets all three objectives. A modern legislative and administrative framework introduced in the bill would generate stable and secure revenues and also address contraband pressures. Moreover, this would be achieved without imposing unrealistic or unnecessary costs and administrative burdens on industry.
The measures relating to alcohol would include: maintaining the imposition of duty at the time of production of spirits, replacing existing sales levy on wine with the production levy at an equivalent rate, deferring the payment of duty for spirits and wine to the wholesale level, and introducing modern collection tools. At the same time the bill would help to address the government's ongoing concern over smuggling and the illegal production of alcohol.
I will discuss some of these key measures in more detail. Along with the production levy on spirits and wine that I have just mentioned the legislation would incorporate strict controls on the production, importation, possession and use of non-duty paid alcohol together with significant penalties for breaking the law. The spirits industry would no longer be hindered by outdated and onerous controls over premises and equipment. With these controls removed businesses would have greater flexibility to organize their commercial affairs to respond more quickly to market changes.

Statements by Members
Economic DevelopmentMr. André Harvey (Chicoutimi--Le Fjord, Lib.): Mr. Speaker, the secretary of state responsible for Economic Development Canada has approved financial assistance for the Société d'aide au développement des collectivités de Manicouagan so that it may continue to provide e-business advisory services for the lovely North Shore region.
Our government is pleased to be associated with a project whose goal is to support the efforts of SMBs in the region which are already very aware of the importance of e-business and who are looking for new business opportunities and new markets.
Investments such as this are a sign of our government's desire to help SMBs on the North Shore develop and prosper, and thus ensure the economic development of this region for generations to come.
Sandra JohansenMr. Peter Goldring (Edmonton Centre-East, Canadian Alliance): Mr. Speaker, I would like to take this opportunity to introduce to my colleagues Ms. Sandra Johansen from the great and wonderful riding of Edmonton Centre-East. Ms. Johansen is with us today on her first visit to Ottawa and to this Chamber of Canada's commoners.
Ms. Johansen has been imbued by a strong sense of duty to serve as a volunteer to be an integral part of the political process, to have a voice and a role to play as we work together for the benefit of all Canadians.
I need not remind all members of this House that our riding boards of directors and membership volunteers work tirelessly to advance the ideals of our party's beliefs. Our board presidents have an important role in guiding these efforts.
I wish to congratulate Ms. Sandra Johansen who is board president of the riding of Edmonton Centre-East on her efforts.
CmhcMr. John Finlay (Oxford, Lib.): Mr. Speaker, I want to say a few words about Canada Mortgage and Housing Corporation and the affordability and choice today program, known as ACT.
My colleague, the Deputy Prime Minister, who is responsible for CMHC, recently announced 15 grants worth up to $20,000 each under the federally funded ACT program.
Some of this year's grants aim to increase housing affordability and choice through options such as secondary suites, smaller infill lots, multiple units, rental housing and housing for youth and independent seniors. Others streamline the development approvals process or remove barriers to innovation.
ACT is managed jointly by CMHC, the Federation of Canadian Municipalities, the Canadian Home Builders' Association and the Canadian Housing and Renewal Association.
It brings together municipalities along with private and non-profit housing sectors to develop, demonstrate and promote innovations in local planning and building regulations that can help to improve housing affordability, quality and choice for Canadians.
VolunteersMr. Tony Tirabassi (Niagara Centre, Lib.): Mr. Speaker, today marks the beginning of Global Youth Service Day celebrations. From April 26 to April 28 youth volunteers will be busy conducting food drives and car washes, among a wide range of other volunteer activities.
This day celebrates, recognizes and mobilizes youth volunteers and is celebrated by 32 international organizations in over 100 nations. It falls during Canada's National Volunteer Week which offers us a special opportunity to shine a spotlight on the spirit and energy of Canada's youth.
Of the 6.5 million volunteers in Canada 29% are youth between the ages of 15 and 24 who contribute an average of 130 hours each year to important causes like education, social services, arts, culture and recreation. Global Youth Service Day allows us to recognize these important contributions.
I invite the House to join me in applauding the efforts of our young people in making a difference in communities across Canada.
Radio-CanadaMs. Carole-Marie Allard (Laval East, Lib.): Mr. Speaker, Radio-Canada's unionized newsroom employees have been locked out for five weeks. As the vice-chair of the Special Committee on Non-Medical Use of Drugs, I am concerned.
This lockout is taking place at the same time as legal sagas involving biker gangs are unfolding in Quebec. It is in the public interest that the actions of these thugs be widely reported so that the public is informed about this gangrene which has infiltrated our democratic societies. The activities of these criminals are a threat to the life and security of our young people, for it has been shown that their attempts to drug them are succeeding. The conspiracy of silence must be broken and information allowed to circulate. Radio-Canada has a crucial role to play.
Radio-Canada managers, who are paid $52 an hour to replace the unionized workers, will never take the place of seasoned journalists on top of their stories.
Faithful Radio-Canada fans are fed up with incomplete and sloppy reports by overpaid managers.
Enough is enough.
George MarcelloMr. Keith Martin (Esquimalt--Juan de Fuca, Canadian Alliance): Mr. Speaker, each year 160 Canadians die while waiting for an organ transplant. Canada has one of the lowest organ donor rates in the entire world. Half of all usable organs are never transplanted as too many people forget to sign their cards and tell their loved ones.
George Marcello, only days from death in 1995 from liver failure, received a new liver as a result of a family's tragedy. Six people's lives were saved as a result of this gift of life. To draw attention to this, George has walked throughout Canada and will complete his Canada 769 Day Walk in Toronto this year. Thousands have carried his torch of life from community to community to educate people on our need to sign our organ donor cards and tell our family members.
George has given hope to the 4,000 Canadians awaiting the gift of life. I salute a Canadian hero, George Marcello, who is in Ottawa today.
Arts and CultureMs. Sarmite Bulte (Parkdale--High Park, Lib.): Mr. Speaker, on Monday, April 22 the wealth and breadth of Canadian opera was featured and celebrated at a concert showcase at the Glenn Gould studio, CBC broadcast centre. A first for Toronto and indeed Canada, Opera Festival 2002 celebrated the exciting world of opera. Over 249 musicians, 169 singers and 24 dancers were featured on six different stages.
Collaborating in Opera Festival 2002 were: the Professional Opera Companies of Canada; the Canadian Opera Company; Opera Ontario; Opera Atelier; Tapestry New Opera Works; Autumn Leaf Opera &amp; Performance; and Soundstreams Canada. At the heart of the festival was Opera Conference 2000. Over 500 delegates from around the globe gathered in Toronto to advance and explore the art of opera and opera productions.
I congratulate everyone involved in the festival for their outstanding contribution to Canada's arts and culture.
Non-Violence WeekMs. Jocelyne Girard-Bujold (Jonquière, BQ): Mr. Speaker, I would like to commend Mr. Rock Gilbert and the numerous volunteers who, this week, launched the second annual non-violence week in Saguenay--Lac-Saint-Jean.
Nowadays, violence takes a number of forms; it can be physical, verbal or psychological. It is becoming more and more of a presence in all spheres of our society.
During the week, the event's organizers will be meeting people in schools and shopping centres throughout the region in order to raise awareness of the issue of violence. The only way to eradicate this unfortunate phenomenon is to talk about it.
I urge the federal government to acknowledge the problem of violence and to put in place an initiative to eradicate it and to allow us to live in a world of joy, good humour and humanity.
VolunteerismMs. Raymonde Folco (Laval West, Lib.): Mr. Speaker, I would like to draw attention to the hard work and perseverance of a number of volunteers in my riding of Laval West.
Thanks to the devotion of Mrs. Irène Mackriss and the generosity of Mr. Paul Champagne, as well as many legion members, Royal Canadian Legion branch 251 in Chomeday, Laval, is now equipped with an elevator. Now older or disabled legion members, which means the majority of the branch membership, have easy access to the legion premises, which are on the second floor and were reachable only by some very hard to manoeuvre stairs.
This initiative took a number of years to achieve. Once again, the volunteers continued their efforts despite numerous refusals. Their success reflects upon the entire voluntary sector.
I salute all of the people who helped this project to see the light of day through their efforts and their financial contributions, thus making it possible for the mobility impaired to gain easier access to the Laval Royal Canadian Legion .
Hepatitis CMr. Grant Hill (Macleod, Canadian Alliance): Mr. Speaker, four years ago April 28 there was an infamous vote in the House of Commons, Liberals crushing a motion to provide compensation to all the hepatitis C victims of tainted blood. Liberals chose only to help victims during the period of 1986-90.
A young victim, Joey Haché from the Ottawa area, became the hero of the debate. He asked the Prime Minister to explain and said “tell me the difference between someone infected with tainted blood on December 31, 1985 and January 1, 1986”.
I am sure that the forgotten victims outside this artificial legal window of compensation are still waiting and suffering. I am equally sure that Joey Haché is still watching carefully. On this issue he is the Prime Minister's conscience.
Centre for Research and Education in Human ServicesMrs. Karen Redman (Kitchener Centre, Lib.): Mr. Speaker, I rise today to acknowledge the 20th anniversary of the Centre for Research and Education in Human Services, a Kitchener based group dedicated to social well-being of Canadian communities.
The centre employs over 35 community researchers who help build bridges between disadvantaged people, the government, the corporate sector and social services. The centre has prepared reports to combat racism and hate crimes while promoting social change in the areas of housing, health, and psychiatric care for those returning to communities after receiving treatment.
The centre was established in 1982 with a vision to create a place where research could be conducted in a different way than is typical in academic settings. Efforts were made to give a voice to people with limited access to power and opportunity.
I congratulate the Centre for Research and Education in Human Services for 20 years of innovative, community based research.
Day of MourningDick Proctor: Mr. Speaker, this Sunday we will again observe the Day of Mourning for employees killed and injured at work. Last year 800,000 Canadians were injured at work while 882 died on the job.
When we pause again this April 28 we will remember the four Canadian soldiers killed last week in Afghanistan and the more than 200 Canadians killed September 11.
As someone who knows firsthand the agony of losing a family member through an industrial accident, we must do more than mourn. Sometimes these are just tragic accidents but some workplace accidents are indeed a crime. Next month is the sad anniversary of the 26 miners entombed at Westray. It is called the Westray disaster, but the other disaster is that 10 years on no one has ever been brought to justice for what the inquiry concluded was a preventable explosion.
No employer should have the right to knowingly put workers' lives at risk, and those who do must feel the full force of the law.
Workplace Accidents and Occupational IllnessMr. Bernard Bigras (Rosemont--Petite-Patrie, BQ): Mr. Speaker, April 28 is designated as a day of compassion in memory of workers who have been injured, killed or disabled as a result of a workplace accident, or are suffering from an occupational illness.
In Canada, in 1998 alone, approximately 800 persons died as a result of a workplace accident or an occupational illness, and almost 900,000 suffered injuries.
Beyond the direct and indirect costs, estimated to be around $10 billion annually, each life that is lost and every injury that is sustained represents a story of human suffering for the victims and those who are close to them.
We must work, individually and collectively, to fight the causes of this problem, and its effects. As elected officials, we must move beyond awareness and translate our awareness into improved legislation for workers.
The Bloc Quebecois will continue to make this issue a priority.
Youth in the WorkplaceMr. Serge Marcil (Beauharnois--Salaberry, Lib.): Mr. Speaker, I wish to thank the Châteauguay chamber of commerce and industry for the press conference it held on Monday, April 22, at which I announced the launch of the Youth Internship Canada project in Châteauguay. Under the direction of Isabelle Lareault, from the local Châteauguay employment centre, 15 young people, aged 16 to 30, will undertake a 16 to 30 week paid internship in the workplace.
In addition to taking part in preparatory workshops for four weeks, they will benefit from a structured program that will allow them to gain the skills that today's employers want, thereby helping them enter the workforce.
Human Resources Development Canada contributed $101,149 to this project. Thanks to the Youth Employment Strategy, the Government of Canada is pursuing its efforts and fulfilling its commitment to help the youth of Châteauguay participate fully in today's workforce.
Cancer ResearchMr. Greg Thompson (New Brunswick Southwest, PC): Mr. Speaker, April is well known to Canadians as Daffodil Month, the annual campaign of the Canadian Cancer Society. This year the cancer society campaign is working hard to raise $18 million.
The funds go to research on all types of cancer; advocating for public health policy; promoting healthy lifestyles and strategies for reducing cancer; and in addition, supporting people living with cancer. This year the society contributed a record $43 million to its research partner the National Cancer Institute of Canada.
In 2001 an estimated 134,000 Canadians were diagnosed with cancer but many of these will live thanks to the Canadian Cancer Society.
April is almost over. However with the generosity of Canadians I am positive the Canadian Cancer Society campaign will exceed its fundraising goal.
Day of MourningMr. Gurbax Malhi (Bramalea--Gore--Malton--Springdale, Lib.): Mr. Speaker, Sunday, April 28 will be a special day. It will mark the 11th annual national Day of Mourning. The day is a unique occasion to commemorate those who have been killed or injured in the workplace and to sympathize with their families and friends.
The significance of the national Day of Mourning becomes even clearer when we look at the staggering statistics for 1999: close to 800 deaths and nearly 900,000 injuries. That is an average of three workers killed every working day and one worker injured every nine seconds.
I rise today to ask all hon. members to take time to remember the workers who lost their lives or were injured on the job in the past years and to remind all Canadians that occupational safety is everybody's concern. We pay tribute to those we remember by putting forth our best efforts to strive for safer and healthier workplaces through continued education, awareness and co-operation.
The Speaker: Order, please. I think the House should rise to observe one moment of silence to commemorate the national Day of Mourning and to honour the memory of workers killed or injured at work.
[Editor's Note: The House stood in silence]

Oral Question Period
Leadership CampaignsGrant Hill: Mr. Speaker, the Deputy Prime Minister wants specific examples to explain why 70% of Canadians say that this government is corrupt.
Here is one. The finance minister's secret fundraiser, raising funds for his phantom leadership bid, is also on the department payroll. That is unethical.
How many more examples does the Deputy Prime Minister need to understand why Canadians think this government is rotten to the core?
Hon. John Manley (Deputy Prime Minister and Minister of Infrastructure and Crown Corporations, Lib.): Mr. Speaker, yesterday the Leader of the Opposition said:

The ethics counsellor told us that he has no record of the minister asking for his advice on Mr. Palmer.

Not only did he not have that information from the ethics counsellor, he tabled a letter from the information office of Industry Canada, and in fact his statement is false.
How many more examples do the people of Canada need to determine that the party in opposition is shallow and empty and has nothing to say about anything of substance but just tries to scandalmonger?
Grant Hill: Mr. Speaker, let us clarify the letter that we did receive. We put in an access to information request for all documents from Industry Canada on the interchange between Mr. Palmer and the finance minister, and they said to us that there was no information in the department, none.
We were told by the finance minister that there had been consultations. That is why this government looks corrupt to the Canadian people.
What does the Deputy Prime Minister have to say to that?
John Manley: Mr. Speaker, the letter they passed over yesterday was actually addressed to Mr. J. Murray, P. O. Box 657. I guess that is the nom de plume they use when they ask for information. They asked for a copy of the report prepared by the office of the ethics counsellor and took the fact that there was no written report prepared by the ethics counsellor to mean what the Leader of the Opposition said yesterday, “We have heard from the ethics counsellor that he has no record of the minister asking”.
What they said in the House yesterday was false.
Grant Hill: Mr. Speaker, too many questions are raised regarding the ethics of this government.
Canadians want to see action taken. Taxpayers want the government to be accountable. People want things to change.
Will the Deputy Prime Minister promise to immediately introduce an act to appoint an independent ethics counsellor who will report to parliament, as was promised? Yes or no?
John Manley: Mr. Speaker, will the Leader of the Opposition come into this place and admit that he made false statements, that he made false accusations?
How can we, in a parliament, have debates on issues that are fundamental to Canadians when some spend their time making accusations that are simply not true?
Mr. Randy White (Langley--Abbotsford, Canadian Alliance): Mr. Speaker, I know this is unpleasant for them but they will just have to bear with us and the rest of the 70% of Canadians who are unhappy with them.
What about an organization that gets a $1 million grant from the heritage minister? It is not a coincidence that the chairman of that organization just happens to be a fundraiser for the minister of heritage's leadership campaign.
What does the Deputy Prime Minister call that? Is that corrupt or is there another name for it?
John Manley: Mr. Speaker, at least the member has clarified what he said yesterday when he accused the department of giving a grant to the person, not to the non-profit organization which the individual was helping as a volunteer and who in turn volunteered to help the minister.
Has it reached the point where people who are engaged in the volunteer or non-profit sector in Canada must stay away from also being supporters of or adherents to political parties? Why does the member for Langley--Abbotsford not get up and admit in the House that what he said yesterday was not true?
Randy White: Mr. Speaker, I know this is unpleasant for them but they have to get used to it.
Let us talk about the Deputy Prime Minister for a moment. In his former role the Deputy Prime Minister had the responsibility for the ethics counsellor. He had eight years to make good on the Prime Minister's promise to clean up and return integrity by appointing an ethics counsellor reporting to parliament. He had eight years to do that.
Here it is eight years later, there is no ethics counsellor and government integrity is a disaster.
John Manley: Mr. Speaker, not only has the ethics counsellor frequently appeared before parliamentary committees but also, as the hon. member knows, in the British parliamentary system--for which those members have very little respect; they prefer the American congressional system--the conduct of ministers is the responsibility of the Prime Minister.
We have listened to those members in election campaigns. They were going to do away with parliamentary pensions. They thought that Stornoway should be turned into a bingo hall. They did not believe that the leader of their party should have a car and a driver. They did not believe in a whole lot of things and once they got here, they changed their positions. They are just an empty hollow bag of wind.
Foreign AffairsMr. Michel Guimond (Beauport--Montmorency--Côte-de-Beaupré--Île-d'Orléans, BQ): Mr. Speaker, former Minister of Foreign Affairs, Lloyd Axworthy, is warning Canada against the dangers that await it if it decides to enter into a unified military command with the United States. Mr. Axworthy also points out that this could seriously limit Canada's freedom to act, as well as its ability to maintain an independent foreign policy.
Will the Minister of Foreign Affairs tell us whether the comments made by his former colleague correspond to his vision of Canada's foreign policy?
Hon. Bill Graham (Minister of Foreign Affairs, Lib.): Mr. Speaker, I can assure the House that the report to which my colleague refers will be tabled before the Standing Committee on Foreign Affairs and that it will be considered.
Right now, there is absolutely no question of a threat to the sovereignty of Canadians or of Canada, because we have no agreement with the United States in this regard. The Americans have put in place certain provisions for their own security. We will examine those provisions and take the necessary measures to protect ourselves and to guarantee our own security and sovereignty.
Michel Guimond: Mr. Speaker, the Bloc Quebecois feels that the army must redefine its role and target its objectives in order to maximize its effectiveness both in Canada and abroad. A unified command with the United States could mean an increase in military spending of some $16 billion.
Will the government agree that we cannot embark on such a major undertaking without at least first holding a public debate?
Hon. Art Eggleton (Minister of National Defence, Lib.): Mr. Speaker, the hon. member is distorting the picture. That is not what this is all about.
The unified command plan, the changes in the United States, are completely internal to its system. We are just looking at ways that there can be practical co-operation between the two, maybe in planning or something. We are not talking about putting our troops under its command at all.
The hon. member should know that we already have extensive agreements with the United States with respect to co-operation. We are just looking at the post-September 11 situation as to how we can elaborate on those practical co-operative efforts.
Stéphane Bergeron: Mr. Speaker, according to Mr. Axworthy's document, the Americans' military spending level, as a percentage of the GDP, is more than double that of Canada.
Does the Minister of Foreign Affairs realize that the Americans could demand that Canada spend the same percentage as they do, which would result in an increase of some $16 billion in Canada's military spending?
Bill Graham: Mr. Speaker, as we told the House, the U.S. government is not in a position to demand that Canada engage in military spending. It is this House, it is the Canadian government that makes the decisions regarding our military spending, and we will continue to do so, with the sovereignty and security of Canada and Canadians in mind.
Stéphane Bergeron: Mr. Speaker, if, according to the minister himself, there is still no agreement between the two countries, could the minister confirm the existence of informal talks with the United States on Canada's participation in a possible unified command?
Art Eggleton: Mr. Speaker, in fact we initiated the informal talks that are now going on. They are discussions to determine how Norad would be affected by this new northern command system. We have now established that it will maintain its high status as a binational command. We are happy about that. We are looking for other ways where we can co-operate with them, but we are not looking for the extent of the kind of integrated structures the hon. member is talking about. This is not a question of integration at all. It is only a question of practical co-operation.
Hon. Lorne Nystrom (Regina--Qu'Appelle, NDP): Mr. Speaker, my question is for the Deputy Prime Minister. It arises out of the press conference held this morning by Lloyd Axworthy, the former minister of foreign affairs, and the current member for Don Valley West. They claimed that the debate over the northern command is as important now as the debate in the 1980s over free trade. Mr. Axworthy also expressed the concern that trade is now trumping sovereignty, something we in the NDP have been saying in the House for the last few years.
I ask the Minister of Foreign Affairs, or the Deputy Prime Minister preferably, does he accept the analysis made by Mr. Axworthy this morning, or is it the government's intention once again to sell out the country like it did during the free trade debate?
Bill Graham: Mr. Speaker, I have not had an opportunity to examine the precise words of Mr. Axworthy so I hesitate to take exactly what my hon. colleague has been good enough to say Mr. Axworthy said.
If in fact he is suggesting that what we are presently doing in terms of mere discussions with the United States as to how we can better assure the security of Canadians is somehow selling out our sovereignty, I totally reject the suggestion. As the Minister of National Defence has indicated to the House, what discussions we have had have enhanced our sovereignty and have enhanced our security. We will continue to do that as this government acts on behalf of all Canadians.
Lorne Nystrom: Mr. Speaker, what concerns me is the Liberal track record. I remember their campaigning against free trade, getting elected and then implementing free trade back in 1993.
This morning Mr. Axworthy also called for a full parliamentary debate on the whole issue of the northern command. I would like a precise answer from the Deputy Prime Minister to this question. Will he give a commitment today to a full public and parliamentary debate in the House of Commons with a free vote before the government implements the ideas of the northern command?
Art Eggleton: Mr. Speaker, as both the Minister of Foreign Affairs and I have said already in response to questions, the hon. members are greatly distorting what this thing is all about.
Certainly we leave open the opportunity for any discussions and any input from the House. However, members should wait to see what these discussions bring out. We are talking about practical levels of co-operation. We may be able to broaden our security relationship with the United States. It does not mean deepening. It does not mean integration at all.
The EnvironmentRight Hon. Joe Clark (Calgary Centre, PC): Mr. Speaker, the government has said that it will involve the provinces in decisions respecting any ratification of, or alternative to, the Kyoto accord.
Does the government accept in principle the view that it would be wise to convene a first ministers conference on Kyoto and related matters as soon as possible? If such a meeting is convened, would the agenda include the discussion of any federal proposal for a carbon tax?
Hon. Herb Dhaliwal (Minister of Natural Resources, Lib.): Mr. Speaker, the first ministers asked that we have a joint ministerial group composed of provincial and federal ministers. They meet regularly. They are meeting at the end of May.
Once again the hon. member knows this government has never looked at a carbon tax in the past, nor will it now or in the future. He should not continue to raise this issue again and again. He should look at what work has been done. He should congratulate and commend the good work that has been done by the federal and provincial governments jointly on a very important issue for Canadians.
Mr. Rick Borotsik (Brandon--Souris, PC): Mr. Speaker, the minister should recall what he did with the GST and free trade, so Canadians unfortunately do not agree with what the Liberals have to say in most cases.
The government has kept Canadians in the dark with respect to how good its intentions are in putting forward the Kyoto accord. It has sent up a trial balloon on a carbon tax.
Would the Minister of Natural Resources please tell the House and Canadians today what it is that he has planned for the Kyoto accord, how he will pick the pockets of Canadians and what kind of taxes will be involved in that pocket picking?
Herb Dhaliwal: Mr. Speaker, instead of looking at headlines, the hon. member should do his research and look at the work that has been done and the process that has been followed.
We are meeting at the end of May with the federal-provincial-territorial ministers. There are discussions going on. We need to make sure that we have the provinces and the territories on side because it is a team Canada approach that we are looking at.
The hon. member should know that any revenue measures are looked at by the finance minister during the budget. Certainly he should know that. That is when those areas are brought forward.
HealthMr. Rob Merrifield (Yellowhead, Canadian Alliance): Mr. Speaker, four years ago this week the Liberal government turned its back on thousands of Canadians who were poisoned by blood tainted with hepatitis C. Tears flowed in the House and thousands of victims were shut out of a government's artificial legal window.
It turns out that there is an incredible $900 million remaining in the compensation fund. Can the government find it in its heart to compensate all victims of tainted blood?
Hon. Anne McLellan (Minister of Health, Lib.): Mr. Speaker, the government has been absolutely clear in relation to the approach it has taken to the compensation of certain victims suffering from hepatitis C. In fact a settlement agreement has been entered into. That settlement agreement has been accepted by the court in relation to the action.
The hon. member needs to be aware that the government more than lived up to its obligations in relation to hep C victims.
Rob Merrifield: Mr. Speaker, there is money for the lawyers and there is money for the bureaucrats, but there is no money for the left out victims. What will the government do with the remaining $900 million?
Anne McLellan: Mr. Speaker, the hon. member has to understand that there is not $900 million remaining. In fact the government has committed approximately $1.4 billion. The money that has been set aside under court accepted agreement is to compensate hep C victims over the next 10 to 15 years.
We know full well that individuals may be identified in the years to come. There is a progression in some cases in relation to this illness tragically--
Lumber IndustryMr. Gérard Asselin (Charlevoix, BQ): Mr. Speaker, today we learned that the tariff to be placed on Canadian and Quebec exports of softwood lumber will be 27.22%. Unfortunately, the Minister for International Trade has been dragging his feet on this issue.
With the letter from Quebec minister François Gendron, is the minister going to finally agree that it is high time the government put in place measures to help companies and workers in the softwood lumber industry, as the Quebec minister is urging it to do?
Pat O'Brien: Mr. Speaker, as the Minister of Human Resources Development has pointed out repeatedly, every possible way to assist the workers has been undertaken and indeed, additional steps are being reviewed.
The suggestions of the Government of Quebec are very interesting and helpful. We have had suggestions from other provinces as well. They are all under careful review. The government is considering what additional steps, if any, may be required. We are not about to take a precipitous decision, but we will act in a timely manner.
Gérard Asselin: Mr. Speaker, some weeks ago the Bloc Quebecois proposed a realistic assistance plan for the workers and the companies. Is it not high time the minister assumed his responsibilities and announced immediate assistance measures?
Pat O'Brien: Mr. Speaker, as I said the other day, the Bloc can demand immediate action as often as it wants, but the point is that there are serious considerations under proposal from all the provinces, including the province of Quebec. They have to be reviewed.
The government is taking stock of the situation. In due course it will take a decision, but it is not about to make a bad decision just to please the Bloc Quebecois.
HealthKeith Martin: Mr. Speaker, when they were in opposition, the Liberals were calling for compensation for all thalidomide victims and all people infected with HIV from tainted blood.
Justice Krever said “Compensating some needy sufferers and not others cannot, in my opinion, be justified”. Today, we have learned that there is $900 million available to compensate all of the victims of the tainted blood scandal.
Does this government have a heart?
Anne McLellan: Mr. Speaker, indeed this government has a heart. That is why we contributed hundreds of millions of dollars to a court accepted settlement agreement for those victims of hepatitis C between 1986 and 1990.
Let me just again inform the hon. member that this fund is set aside and is run by an administrator. The administrator is dealing with thousands of claims. In fact some 1,700 victims have already been identified and verified by the administrator and are in the process of receiving compensation.
Keith Martin: Mr. Speaker, the problem is that the patients who need the money are not getting the money. Sure they are being identified, but the patients with hepatitis C are not getting the money. The problem is the lawyers are getting the money, not the patients.
My question for the hon. minister is simply this. Will she intervene to ensure that those patients with hepatitis C, who were infected through no fault of their own, get the compensation that they deserve immediately.
Anne McLellan: Mr. Speaker, let me reiterate that under a court accepted settlement agreement there is an administrator in place. He has received in total to date approximately 5,500 claims. Over 1,700 of those claims have been verified by an independent administrator and they are receiving compensation.
It is simply not correct for the hon. member to suggest that victims of hepatitis C are not receiving compensation under this settlement agreement.
Guaranteed Income SupplementMr. Marcel Gagnon (Champlain, BQ): Mr. Speaker, the Minister of Human Resources Development recently boasted that 16,000 of 23,500 retired people who were sent a simplified form returned it, and will soon receive the guaranteed income supplement to which they are entitled.
Does the minister realize that the job is not yet done and that there are still hundreds of thousands of retired people who need to be contacted?
Raymonde Folco: Mr. Speaker, I wish to point out that the department has taken all the necessary measures to inform the eligible clients. We have said this in the House on several occasions.
Allow me to provide two examples: the first is that more than 30,000 articles were sent to eligible seniors in Quebec to provide them with information on the guaranteed income supplement.
Also, the Conseil régional de l'âge d'or was a major partner in conferences held on the guaranteed income supplement, which means that people are well informed of this problem.
Marcel Gagnon: Mr. Speaker, the government members have been with us all the way. They supported the committee report, they simplified the forms and they adjusted government advertising. Now all that is left for them to do is recognize that all retired people deserve full retroactivity.
When will the minister take action?
Raymonde Folco: Mr. Speaker, there was always a provision for retroactive payment of the guaranteed income supplement.
As I said last week, this 11 month retroactive payment is perfectly normal under the circumstances. Last week, I mentioned the fact that the government of Quebec makes no retroactive payments in its employment assistance program, nor in its rent subsidy program.
The EnvironmentMr. Charlie Penson (Peace River, Canadian Alliance): Mr. Speaker, we understand that the government might try to recover the cost of Kyoto on the backs of taxpayers, 10¢ at a time. The idea for the gasoline tax comes from the same Liberal government that has repeatedly promised there would be no carbon tax to implement Kyoto.
Will this broken promise be just another on the long Liberal list of broken promises?
Herb Dhaliwal: Mr. Speaker, first, Alliance Party members for many have said that we should not worry about climate change, it is not a problem. They wanted to bury their heads in the sand. Their former leader stood in the House and said that there was no scientific proof of climate change. I am glad they have changed their minds now and feel that we should be taking action on climate change because it is a very serious problem.
I wish the hon. member would take this issue seriously instead of scaremongering and putting on the table what is not even there. Why do they not take climate change seriously and make sure--
The Speaker: The hon. member for Peace River.
Charlie Penson: Mr. Speaker, what I am worried about is the hot air coming from that side of the House today. The last time a government tried a gas tax like this, in 1979 to be exact, it brought down the government.
Premier Campbell and Premier Klein have both called for a first ministers conference on Kyoto. Will the government work in good faith with the provinces to develop a made in Canada solution that works and one that does not include a gas tax?
Herb Dhaliwal: Mr. Speaker, we have repeated in the House, not only myself but many other ministers, that we would never consider a carbon tax in the past, or the present or in the future. The hon. member and his party do not hear very well.
There is a process set up. The first ministers have asked for a joint meeting of federal-provincial-territorial ministers. That is happening. We are working with them. We have another meeting.
Why does the hon. member not let them work and do the job that they have been asked to do by the first ministers so we can assure Canadians that Canada is playing its role in ensuring--
The Speaker: The hon. member for Ottawa Centre.
International Co-operationMr. Mac Harb (Ottawa Centre, Lib.): Mr. Speaker, last week in Washington there was a meeting that was attended by ministers of finance from around the world, including the Minister of Finance of Canada. They backed a plan that was proposed by the World Bank to help children in poor countries to have access to primary education.
My question is for the Parliamentary Secretary to the Minister for International Cooperation. Could she tell the House what her department's plan is to meet the aims and the commitment that we made in Washington.
Mrs. Marlene Jennings (Parliamentary Secretary to the Minister for International Cooperation, Lib.): Mr. Speaker, Canadians feel very strong about the value of education and of our role as a country helping the developing world achieve education for all. That is why the Minister for International Cooperation launched CIDA's basic education action plan last Wednesday, pledging a $555 million investment over a five year period. This signifies a quadrupling of Canada's investment for basic education in developing countries.
With the help of Canadians, developing countries and other donor partners the plan aims--
The Speaker: The hon. member for Palliser.
AgricultureDick Proctor: Mr. Speaker, scant days after the release of the Prime Minister's caucus task force on future opportunities and farming concluded that the government was not doing enough to deal with the farm income crisis, the agriculture minister was yet again warning farmers that government's pockets were not as deep so farmers should not expect to see any bridge financing in the near future to offset the international subsidies. Yet the government itself is projecting a $10 billion surplus at least this year.
Would the Deputy Prime Minister please tell farmers what the agriculture minister's rationale is for saying that there is not sufficient funds?
Mr. Larry McCormick (Parliamentary Secretary to the Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, first, I would like to take my first opportunity here in the House to thank and congratulate the members of the Prime Minister's task force for their excellent work.
As the House knows, they also said that the safety net programs needed to be financed on a long term basis with financing guaranteed for five years. That is exactly what our minister of agriculture is attempting to do, along with our other colleagues in the House. This follows the strong commitment by the Minister of Finance in the budget and also in the throne speech; to move past where we are today and move past crisis management.
Dick Proctor: Mr. Speaker, the chair of the Prime Minister's task force on this subject has stated that the Prime Minister's Office is advising ministers to read the report and decide what role each can play in its implementation. Instead of facilitating, the agriculture minister pours cold water on additional farm assistance saying there is not enough money. Farmers need water and plenty of it this spring, but they do not need cold water like they have been getting from this minister of agriculture. They continue to be the recipients of mixed messages. Why?
Larry McCormick: Mr. Speaker, the Minister of Agriculture and Agri-Food announced in Saskatchewan this week money to fund all water projects that have been asked for and that are eligible, and also in Alberta. Already this year the federal government alone has committed $1.1 billion to our farmers that will help in short term programs.
Our minister continues to explore every avenue to find more money for our farmers.
FisheriesJoe Clark: Mr. Speaker, the Fisheries Resource Conservation Council has recommended measures to protect Atlantic groundfish stocks. It says the growing seal herd in the gulf is taking cod at a rate that “cannot be allowed to continue”. The fishery is already threatened by foreign overfishing, which the government will not stop.
His own experts are telling the minister that the growth in the seal population is another fatal blow to the fishery.
Will the minister announce plans immediately to increase the total allowable catch for harp seals and will he tell us what other measures he intends to take to act on the warning of the scientists?
Hon. Robert Thibault (Minister of Fisheries and Oceans, Lib.): Mr. Speaker, I have received the recommendations of the FRCC. I thank it for its great work, its services and its recommendations.
I have also received a report from the eminent panel on seal management. I have asked my staff and I will be discussing with the fisheries ministers from all provinces and territories a long term management plan for seals that would include an increase in quota.
EthanolRick Borotsik: Mr. Speaker, it is obvious that the government is doing nothing for the fishery. It is unfortunate however that it is considering doing too little for the ethanol industry. The ethanol industry, as we know, is very important to agriculture, it is very important to western Canada and it is certainly very important to the environment.
Could the Minister of Natural Resources please tell me why the government would even consider removing the 3¢ per litre support for ethanol?
Herb Dhaliwal: Mr. Speaker, the government has been a great promoter of renewable resources and ethanol has been a very important component.
If the member has any views as to how we can improve the use of ethanol, I certainly will look at that. This is something we are considering at this time. I know my predecessor, the government House leader, has done an incredible amount of work on ethanol and renewable resources. We will continue the good work we have been doing.
Softwood LumberMr. Philip Mayfield (Cariboo--Chilcotin, Canadian Alliance): Mr. Speaker, Weyerhaeuser Company, the world's leading lumber producer, is joining the NAFTA challenge to the U.S. duties on Canadian softwood lumber.
There is faulty methodology in the application of these duties. For example, there is discrimination against western red cedar, which has been hit by the duties even though it does not compete with U.S. lumber. Some U.S. companies claiming they are hurt by Canadian lumber are basing their arguments on flawed arithmetic.
Why is the government so inept at persuading the public and the U.S. legislators about these obvious flaws in the U.S. lumber lobby's arguments?
Pat O'Brien: Mr. Speaker, first, let me be clear that the government welcomes the Weyerhaeuser decision to challenge the U.S. dumping determination. We all know that the U.S. actions are illegal and punitive.
The government will continue our two track policy of trying to engage the Americans in good faith negotiations while at the same time pursuing our legal avenues at NAFTA and the WTO.
As for the advocacy campaign the member refers to, he is sitting beside his trade critic and maybe the trade critic could tell him about the year long advocacy campaign in the United States of the government.
Philip Mayfield: Mr. Speaker, what we want to know is what our government is doing on this issue in the United States.
Home Depot Incorporated, Weyerhaeuser Company and a group of U.S. lumber producers and retailers that operate in both Canada and the United States have launched a public appeal for lumber trade peace. In a newspaper ad campaign in Canadian and U.S. cities, six major players in the North American lumber market are calling for discussions between the Prime Minister and the United States president. These companies are trying to fill a vacuum created by the government.
Why has the government still not responded to the outrageous letters and opinion pieces written by a U.S. senator and the U.S. trade commission?
Pat O'Brien: Mr. Speaker, we have just seen the problem with the member asking a prepared second question, not having listened to the answer that was just given.
I indicated that for at least one year this government has been very strongly advocating in the United States with the U.S. Congress and with the American Senate and consumer groups. The trade critic for his party is sitting beside him. He knows that. He was part of those delegations.
He talks about a vacuum. The issue of softwood lumber has been raised by the Minister for International Trade and the Prime Minister of Canada repeatedly at the highest levels. It is time for the Americans to act.
Employment InsuranceMs. Monique Guay (Laurentides, BQ): Mr. Speaker, Revenue Canada systematically refuses to allow related persons working in a family business to qualify for employment insurance. This situation is being condemned by the Law Commission of Canada.
Will the Minister of Human Development Resources admit that such discrimination is totally unacceptable?
Raymonde Folco: Mr. Speaker, I think that the hon. member opposite did not quite understand the legislation and the regulations.
The idea is not to exclude these people from the employment insurance program. Rather, it is to impose fines on those who fraudulently collect money from the government by lying.
Monique Guay: Mr. Speaker, the parliamentary secretary should do her homework and get to know her file.
Does the minister intend to amend the act by eliminating this discrimination and following up on the opinion of the Law Commission of Canada?
Raymonde Folco: Mr. Speaker, I do not want to get into a big argument with the hon. member opposite. I think that she herself should look at the file.
These are people who collected money from the government by resorting to fraud. The hon. member should read the Canada Gazette and make suggestions. She has until next week to make suggestions to the Government of Canada as to which changes could be made to the regulations.
Age of ConsentMr. Chuck Cadman (Surrey North, Canadian Alliance): Mr. Speaker, the Minister of Justice wants to consult more on raising the age for sexual consent. In this place in 1999 I spoke of a 51 year old sex offender who was acquitted of sexually assaulting a 14 year old girl because the judge believed she had consented. I think that power, control and coercion likely had something to do with that.
This law subjects young people to abuse by predatory adults. The need for more consultation implies some opposition, so just who is opposing the raising of the age to 16 years, and why?
Mr. Paul Harold Macklin (Parliamentary Secretary to the Minister of Justice and Attorney General of Canada, Lib.): Mr. Speaker, we have taken leadership on this side of the House and we have set up a consultative process that has been ongoing for two years. As recently as February of this year we continued further to now set out, with our officials, to bring back recommendations so that in fact we will be able to go forward. If there are legislative proposals that will work we are going to implement them and make sure that our children are protected.
Chuck Cadman: Mr. Speaker, we have all heard of child pornographers citing the consent laws to defend their deviant activities.
Between March 1998 and March 2000, I tabled petitions totalling over 12,000 names demanding the raising of the age for sexual consent. That petition was driven by Diane Sowden, a dedicated activist whose young daughter fell prey to pimps and drugs on the streets of Vancouver.
The government has been consulting on the issue for nearly a decade now. Canadians have spoken loud and clear. Will the minister change the law now?
Paul MacKlin: Mr. Speaker, clearly we are not doing consultations for just the sake of nothing. We are here trying to react to the public concern, but we have to consult with provinces and territories because there are so many laws that interrelate with respect to the age of consent. It is important that we follow a good, bona fide process with our partners. We are doing that and we are going to continue to do that.
Research and DevelopmentMr. Stan Dromisky (Thunder Bay--Atikokan, Lib.): Mr. Speaker, I would like to direct my question to the Secretary of State for Science, Research and Development.
One of the government's innovation strategies is the creation and support of the Canadian academies of science. Could the Secretary of State for Science, Research and Development tell the House how Canadians would benefit from the creation of the new academies of science?
Hon. Maurizio Bevilacqua (Secretary of State (Science, Research and Development), Lib.): Mr. Speaker, I will do that with a great deal of pleasure. Leading Canadian scientists have recommended that the government create a national academy of science to provide third party assessment as well as to represent Canada's scientific community in international discussions.
Today, as we all know, the challenges and opportunities as they relate to science are global in nature. The Canadian academies of science will help Canada draw upon the excellent international network that exists worldwide.
This is a proposal that is part of the government's innovation strategy. When it comes to innovation, we aim for excellence.
Disaster AssistanceMrs. Cheryl Gallant (Renfrew--Nipissing--Pembroke, Canadian Alliance): Mr. Speaker, communities in Ontario and Quebec along the Ottawa River are facing a crisis due to extensive flooding. Unfortunately, because the federal funding formula penalizes Ontario, residents in other provinces may be eligible for financial assistance while Ontario residents will not be.
Will the minister guarantee eligibility to Ottawa River flood victims on both sides of the river to get the assistance they deserve?
Art Eggleton: Mr. Speaker, the disaster financial assistance arrangement is the same in all parts of the country. There will be no discrimination from one province to another. There is a formula. There is guideline that is in fact followed. If that guideline is applicable in this particular case, then of course the appropriate measures will be taken under the fund.
Cheryl Gallant: Mr. Speaker, Ontario has never applied for flood disaster relief because the disaster financial assistance arrangements program is based on the population of the province, not need. Why is the federal government penalizing Canadians just because they live in Ontario?
Art Eggleton: Mr. Speaker, it is not. The initial responsibility is with the provincial government and the provincial government can provide whatever assistance it wants to.
In terms of the federal government, we reimburse the provincial government and we do that on the basis of a formula that applies evenly right across the country.
TaxationMr. Yvan Loubier (Saint-Hyacinthe--Bagot, BQ): Mr. Speaker, over the past 30 years, the federal government has made administrative errors and made overpayments of several billion dollars to four Canadian provinces, particularly Ontario.
The provinces do not have to pay for this federal mistake and this is why those that did not benefit from the error are asking Ottawa for a compensation equal to the overpayments received by Ontario.
Will the Minister of Finance follow up on this and compensate Quebec and the provinces that did not benefit from such overpayments, by taking into account equalization and the federal miscalculation, which amounts to $210 per capita? This would mean an amount of $1.4 billion for Quebec.
Bryon Wilfert: Mr. Speaker, currently the federal and provincial ministers are meeting in Corner Brook, Newfoundland, to discuss a number of issues, including the issue that the member has raised. It is an important issue to all members and to all provinces across the country. The government is reviewing the situation and I know further discussions will be taking place.
TechnologyMr. Ivan Grose (Oshawa, Lib.): Mr. Speaker, we are all aware of the growing importance in today's society of information technologies, e-commerce and e-government. In past years the government has committed itself through concrete initiatives to assure all Canadians that this issue is taken very seriously in Canada.
Therefore, could the Parliamentary Secretary to the President of the Treasury Board share with the House of Commons the results of the third annual Accenture report on e-government leadership?
If I had written this it would have been much shorter, but we will see what he can do with it anyway.
Mr. Alex Shepherd (Parliamentary Secretary to the President of the Treasury Board, Lib.): Mr. Speaker, the government is highly committed to keeping government online and to making government online as user friendly as possible.
It is with great pride that I focus on the Accenture report. This is a global, international management company which focuses on 23 countries worldwide. What was the number one country for getting people online out of these 23? It was not the United States, it was not the United Kingdom, it was not the European Union, but this country, Canada, through information technology.
TerrorismDarrel Stinson: Mr. Speaker, on the front page of the April 25 Los Angeles Times a headline reads “CIA Warns of Chinese Plans for Cyber-Attacks on U.S.”, regarding both the Beijing government and private Chinese student attacks on American and Taiwanese computer networks.
Has the government received any warnings about Beijing cyber-attacks against Canada and why has the government put a hold on its proposed contracts for cyberspace threat and risk assessments for the Government of Canada?
Art Eggleton: Mr. Speaker, I cannot comment on specific intelligence that is received. We receive bundles of it on a regular basis. We are involved in a very high level network with a number of other countries.
We do in fact look very carefully at the possibility of cyber-attacks, both in this country and those relevant to the United States as well.
PrivilegeThe Speaker: I am now prepared to rule on the question of privilege raised on Thursday, April 18, 2002, by the hon. member for Kootenay--Columbia concerning a statement made in the House by the Minister of Canadian Heritage.
I would like to thank the hon. member for Kootenay--Columbia for raising the matter and the hon. Secretary of State (Amateur Sport) for his contribution on this question.
The hon. member for Kootenay--Columbia alleged that the Minister of Canadian Heritage intentionally provided incorrect information about the awarding of a contract. In support of the allegation, he cited the minister's response to a question asked during question period on Tuesday, April 16, 2002.
I have reviewed the minister's reply during question period and the explanation provided by the hon. Deputy Leader of the Government in the House of Commons in reply to the allegation. In response to the claim of the hon. member for Kootenay--Columbia that a contract in this case has already been awarded, the deputy leader said, and I quote from the Debates of April 18, 2002, at page 10565:

...there is a clear distinction between a notice that is subject to a 15 day review and the actual awarding of the contract...factually the minister's answer was correct. No tender has been awarded at this point.

I must conclude that in the present case this does not constitute a question of privilege but a dispute as to the interpretation of the facts. This is not the first time there has been a dispute over replies to oral questions. Of course, the hon. member for Kootenay--Columbia, if he wishes to pursue the matter with the Minister of Canadian Heritage, has other means at his disposal.

Routine Proceedings
Order in Council AppointmentsKaren Redman: Mr. Speaker, I am pleased to table, in both official languages, a number of order in council appointments made recently by the government.
Interparliamentary DelegationsMr. John Godfrey (Don Valley West, Lib.): Mr. Speaker, pursuant to Standing Order 34(1) I have the honour to present to the House, in two of the four official languages of the Americas, the report of the Canadian delegation of the Interparliamentary Forum of the Americas to the first plenary meeting held in Mexico City, Mexico, from March 13 to 16, 2002.
Mr. Mauril Bélanger: Madam Speaker, I rise on a point of order. I have been paying close attention to the discussions in the last two days in the House about private members' business. I find it particularly interesting that various House leaders would see fit to consider adding a bill to the order of precedence and declaring it votable.
I would like to know if you would seek unanimous consent to declare votable one of the items that is already on the order of precedence as No. 11, Bill C-407, which would give Canadians living in linguistic minority situations, whether they be anglophones or francophones, better access to medical services, which I think is as important as those we have been dealing with in the last two days. Would you please seek unanimous consent for that, Madam Speaker?
The Acting Speaker (Ms. Bakopanos): Is there unanimous consent?
[Intervention]
Some hon. members: Agreed.
[Intervention]
Some hon. members: No.
Old Age Security ActMarcel Gagnon: 
moved for leave to introduce Bill C-449, an act to amend the Old Age Security Act.

Madam Speaker, the purpose of this bill is to correct a significant inequity in the treatment of the poorest seniors, first by making accessibility to the guaranteed income supplement more automatic and, second, by making the government meet the same conditions when it owes money to the poorest members of society as when it is owed money, which is by applying full retroactivity.
(Motions deemed adopted, bill read the first time and printed)
Species at Risk ActHon. Ralph Goodale (Leader of the Government in the House of Commons, Minister responsible for the Canadian Wheat Board and Federal Interlocutor for Métis and Non-Status Indians, Lib.): Madam Speaker, I regret to report to the House that an agreement could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the report stage and the third reading stage of Bill C-5, an act respecting the protection of wildlife species at risk in Canada.
Accordingly, under the provisions of Standing Order 78(3), I give notice that a minister of the crown will propose, at the next sitting of the House, a motion to allot a specific number of days or hours for the consideration and disposal of proceedings at the said stages of that bill.
PetitionsMs. Val Meredith (South Surrey--White Rock--Langley, Canadian Alliance): Madam Speaker, it is my pleasure to present on behalf of constituents two petitions amounting to almost 600 signatures representing a concern in my constituency that the incidence of explicit sex, pornography, violence, rape, murder and unacceptable language, swearing on television, have become extremely frequent with little regard to the time of day or the viewing audience.
The petitioners are very concerned about the effect and the exposure to our children of violence and sex on television during daylight hours. They humbly request that the House of Commons legislate the CRTC to reduce the sexual and violent content contained in the basic cable and satellite packages.
Mr. Scott Brison (Kings--Hants, PC): Madam Speaker, it is with pleasure today that I rise to present the following petition on behalf of my constituents, particularly the citizens who live along the Hants Shore in my riding, along the shore of the Minas Basin. The petition reads:

We, the undersigned residents of Canada, residing on or about Highway 215 East in Hant's Co. Nova Scotia, draw the attention of the house to the following:
The clam beds in this area were allowed to be depleted by diggers outside the area.
The clam worms are being allowed to be depleted by diggers from outside the area.
The diggers from two different areas are fighting over who the worms belong to.

Violence has erupted from the conflict, including a hospitalization on August 28, 2001.
The petition continues:

We the undersigned protest the commercial harvesting of the clam (blood) worms. The clams are gone, soon the worms will be gone, and with them the fish will be gone since they no longer have food, resulting in a collapsed fishery in this area.

The Hants Shore, along the coast of the Minas Basin, is a very unique ecosystem. With the highest tides in the world, it is a very precious ecosystem. I urge the House to consider very strongly protection of this ecosystem because we do not want another cod--
The Acting Speaker (Ms. Bakopanos): Questions on the order paper.
Questions on the Order PaperKaren Redman: Madam Speaker, I ask that all questions be allowed to stand.
The Acting Speaker (Ms. Bakopanos): Is that agreed?
[Intervention]
Some hon. members: Agreed.
[Stage Direction]
The House resumed consideration of the motion that Bill C-47, an act respecting the taxation of spirits, wine and tobacco and the treatment of ships' stores, be read the third time and passed.
Bryon Wilfert: Madam Speaker, the spirits industry will no longer be hindered by outdated and onerous controls over premises and equipment. With these controls removed, businesses will have greater flexibility to organize their commercial affairs to respond more quickly to market changes.
The bill would require anyone producing or packaging spirits or wine to have an alcohol licence. While all vintners must be licensed, those with sales under $50,000 in the previous 12 months will continue to qualify for the small manufacturers' tax exemption. Individuals producing wine for personal use will continue to be exempt from having to be licensed and pay duty.
The new warehousing regime introduced in the bill for deferring the payment of duty on packaged alcohol will place domestic and imported packaged alcohol on an equal footing. This measure is also designed to accommodate the privatization initiatives of some provinces for the warehousing of alcohol.
There will also be comprehensive controls on the non-beverage use of spirits and wine to ensure the protection of federal excise revenues derived from beverage alcohol. These controls include the licensing or registration of users of non-beverage alcohol, the approval of product formulations for which spirits and wine may be used without payment of duty, and the specification of denaturing standards.
The bill would eliminate the current nominal rates of duty on certain non-beverage uses of spirits such as spirits used in pharmaceutical products. These nominal duties are inconsistent and onerous in application and disadvantage domestic products manufactured with spirits vis-à-vis similar foreign products entering Canada.
New rules for imported industrial alcohol, such as requiring the alcohol to be sampled and tested to ensure it meets Canadian denaturing standards, will ensure the integrity of the domestic alcohol market and protect federal revenues.
Finally, fines for alcohol related offences will be increased substantially and serious alcohol offences will now be subject to proceeds of crime provisions.
I will now turn to some of the tobacco provisions under Bill C-47. Under the new excise framework, the current excise duty and excise tax on tobacco products, other than cigars, will be merged into a single production levy. This will mean improved administration and reduced compliance costs for the industry.
While these new measures will provide a more streamlined framework for the taxation of tobacco, the fundamental controls over tobacco under the existing excise framework, such as the stamping and marking requirements for tobacco products, will be maintained.
The legislation also includes the current offence provisions relating to the illegal production, possession or sale of contraband tobacco, which have proven to be effective.
At the same time, the new excise framework incorporates the revised tobacco tax structure that parliament passed last spring.
As I mentioned a moment ago, the bill introduces modern collection tools and helps to address the government's ongoing concern over the smuggling of alcohol.
New administrative measures will enable the CCRA to improve its level of service to clients and its overall administration of the excise framework for alcohol and tobacco products.
These measures include a duty remittance and return structure harmonized with commercial accounting periods and the goods and services tax/harmonized sales tax; new assessment and appeal provisions; and a range of modern collection mechanisms, such as certificates of default, garnishment, seizure and sale of goods and directors' liability.
Further, persons dealing with exciseable goods who fail to comply with the act will be subject to a range of administrative penalties.
The new excise framework will ensure that the excise duties on alcohol and tobacco are collected in a more effective and efficient manner. As well, it provides an array of modern administrative and enforcement tools for ensuring compliance with the new act.
In summary, this new framework for the taxation of spirits, wine and tobacco products will provide a simple and more certain taxation structure, equal treatment of all parties, improved administration and lower compliance costs, greater flexibility for business to organize its commercial affairs and enhanced protection of excise revenues.
Before closing, there are three additional measures in the bill that I want to mention to hon. colleagues. The first concern deals with changes to the ships' stores provisions under the customs and excise legislation that grant relief from duties and taxes for goods used aboard ships and aircraft in international service.
These changes respond to a recent decision of the Federal Court of Appeal that the ships' stores regulations went beyond the scope of their enabling legislation. Bill C-47 rectifies this situation by providing the proper legislative authority for these regulations.
Another measure relates to certain ships travelling on the Great Lakes and the St. Lawrence River that are not engaged in international trade and which no longer qualify for ships' stores relief after May 31, 2002. These ships will now be entitled to a temporary fuel tax rebate on fuel produced between June 1, 2002 and December 31, 2004. This rebate will provide the affected operators with adequate time to make the transition to the new ships' stores rules.
The final measure implements the federal tax increases on tobacco products that were announced in November which re-established a uniform federal tax rate for cigarettes across the country. These increases are co-ordinated with provincial tobacco tax increases and are one more step in the process of restoring tobacco tax rates to pre-1994 levels in ways that will minimize the risk of renewed contraband activity. They are also part of the government's comprehensive strategy to reduce tobacco consumption.
I urge my hon. colleagues to give their full support to the bill. As I indicated at the beginning of my remarks, the new excise act introduces a modern, legislative and administrative framework for the taxation of spirits, wine and tobacco products, thereby addressing a longstanding need of both the industry and the government.
With respect to the remaining measures in the bill, it makes sense to rationalize the ships' stores provisions and to approve the tobacco tax increases for reducing tobacco consumption.
Mr. Ken Epp (Elk Island, Canadian Alliance): Madam Speaker, I am pleased to speak in defence of Canadian taxpayers. Bill C-47 is another one of those infamous tax bills. I do not know how the Liberal government has in its head that it simply cannot find enough sources of taxes. It taxes everything two, three, four and five times. One of the things we are addressing in the bill is an increase in the amount of taxation.
As the parliamentary secretary has said, the bill addresses a number of different areas of taxation. One of them is the taxation of cigarettes. I have said this before in the House and I do not know how often I must repeat it until somebody actually hears and understands what I am saying.
Every dollar that is taken by government out of the hands of the people who earn it is a drain on our economy. I have often said as have others in my party, and in fact our founding leader of the Reform Party stated it as one of his themes, that every dollar left in the hands of a taxpayer, an investor or an entrepreneur does way more to help our economy than that same dollar sent into the centrifuge of taxation, the bottomless pit in Ottawa.
When governments take money out of the economy and redistribute it, they do not do anything directly for the people of Canada in terms of improving their ability to get jobs and look after themselves. In most instances it is detrimental. We cannot seem to get this into the head of the Liberal government opposite. In this particular case we have a government tax grab for people who happen to be addicted to smoking. The government wants to increase the taxes that it is applying to that.
We need to look at this very carefully. It is quite interesting that the government has been able, with respect to smoking, to pass legislation that says we cannot advertise it. That is intriguing. Being a person who feels that the rules of society ought to be applied equally, it seems to me that as long as cigarettes are a legal substance then those who manufacture and sell them should not be forbidden to talk about them.
I am one who is vociferously against smoking. I have told stories in the House before about how one time I smoked a part of a cigarette and decided at that time that I would not do this. It was an intellectual decision. Why would one spend money, which in my youth was difficult to come by, in order to buy things that one simply burns up? Add to that the fact that as we burn them, we take them through our lungs which damages them. That does not make sense.
Furthermore it has long term health consequences. I know several people who have died an early death because of their use of tobacco products. Let not anyone say that since I am opposed to increasing taxes on cigarettes that I am somehow willing to promote the use of cigarettes, especially by youth. The answer to that is a resounding no, I am not in favour of that.
I wonder about a government that takes it upon itself to use tax policy to substantially affect social outcomes. I will go out on a limb but personally I would have liked the government to have declared long ago that tobacco ingested into the body either through chewing or through cigarettes was a dangerous substance. This is not party policy so I do not want to be misquoted. Tobacco, for example, is no less dangerous than the small amount of ill effects we get from certain chemicals used to control weeds on our lawns. The government is willing to declare those dangerous substances.
Sir Walter Raleigh said to wrap a bunch of weeds in a piece of paper, put it in one's mouth, set it on fire, and then suck in the results of that burning. I believe that is a dangerous use of a dangerous substance. If the government were to do that, then it would have the moral authority to ban advertising and its use could not be promoted among young people and so on. However the government has not done that.
Tobacco is not only a legal substance but also a substance supported in its growth and development by various agencies of government. We are sending a mixed message to Canadians with respect to whether or not they should be smoking.
Millions of dollars are spent on government ads telling people of the bad effects of smoking and urging them not to do it. At the same time millions of dollars are spent promoting tobacco farmers and helping them ply their trade. This does not make any sense to me. This is like hooking a horse to the front of a wagon and hooking another horse to the back of the wagon and having them pull in opposite directions. The government ought to start thinking about how it is conducting its affairs. We should all be pulling in the same direction.
Bill C-47 would increase the amount of taxes young people and others would be required to pay when they smoke cigarettes. The price would be increased by $2 per carton in Quebec, $1.60 per carton in Ontario and $1.50 per carton in the rest of Canada. The justification the government gives for this is that in order to stop the smuggling of illegal cigarettes some years ago taxes were increased substantially in Ontario and Quebec, the provinces with the largest problem, and less substantially in other provinces. This would bring prices down so taxes would be equal across the country, which I agree with in principle. We ought not to tax one province more heavily than another because of its geographical location.
To say that increasing taxes is a way of reducing consumption is a little disingenuous on the part of the government since it is generating a large amount of income for itself. What will the government do with that income? Who knows what kind of new hotels it will finance with this money. Maybe it will finance some new musical fountains. Perhaps it will think of some other wonderful ways of spending taxpayers' money. We will not know until it happens and then the government will deny it. All attempts to get the facts will be stymied by the government which ran on a platform of openness and accountability. Unfortunately we do not see a great deal of that.
Incredibly, the tax hike on cigarettes would give the government approximately $250 million per year. I am not good at math in my head on a Friday afternoon so I must do a little calculation here.
The government would get an increased revenue of some $657,000 a day. It would be taken from people who are addicted to cigarettes. Maybe some of them will quit; many of them will not. Many people who are addicted to cigarettes are not well off partially because they must expend a great amount of their income in order to feed their habit. Here we have the government taking money from people who are generally poor at the rate of $657,000 every day.
The government thinks that is the right thing to do. I guess it will go ahead and do it. I hope this increased tax would persuade some young people from not taking up the habit. I hope there would be some who would say that it is an optional tax that they do not have to pay.
I encourage Canadians right across the country not to smoke. I know there are up to three people right now watching CPAC and paying close attention to this. Here is an optional tax that one does not have to pay. I know it will be tough. It is difficult to break one of the most addictive substance uses and that is cigarettes. I know this from observing a number of my friends who have gone through the throes of quitting the habit. It is very difficult. Here is a chance for all the people out there in CPAC land to say to the finance minister that here is some money he will not get. We will keep it. We will not pay this tax. In that sense I am mildly in favour of the outcome, however I do not know whether I am in favour of the way this is being done.
I would also like to point out another thing about cigarette smoking. I know we cannot talk about this without sounding as though we are moralizing. We are told we cannot impose our morals on others. Absolutely. There was a saying “a man convinced against his will is of the same opinion still”. No, we cannot impose a morality on a person. I guess I am not trying to do that. However, I said that I smoked a part of a cigarette one time when I was young. I found a pack that was not totally used up and smoked a part of a cigarette and decided that it was not for me.
People should be encouraged to not start something that ends up controlling them. I recall one speaker on this topic say a reason why he had never taken up the habit of smoking was that he had never in his life had a person over the age of 30 who had smoked for more than five years recommend to him that he start. That is a powerful testimonial.
I would say the same thing. I have a number of friends who smoke and, frankly, some of them say they cannot quit because they need it, they like it, or they enjoy it. They all have various reasons and justifications. Yet I have never had one of them say to me that I am getting on in years and I am missing one of the joys of life and that I take up smoking. I have not had a single one do that. If no one who smokes is ready to recommend smoking, then we ought to listen to that. That is a powerful argument.
We are talking about Bill C-47, a tax bill. I have talked about the increase in taxes to the government. I would briefly like to talk about the change in prices in the use of alcohol. Here again I feel unqualified to speak on this topic from a personal point of view. I have avoided paying the alcohol taxes in this country. I grew up in a home where alcohol was not part of the furniture. We did not use it. For my parents I believe it was partially a religious belief thing.
I did not espouse my parents' beliefs when I was young, but I also made a conscious intellectual decision that I would not use alcoholic beverages. I did this based on the observation of some of my friends who claimed they were having a great time but unfortunately did not know they were having it. I always thought it did not make any sense to take part of one's nervous system and shut it down by whatever means. Most of us can use all the intellectual capacity we can manage to muster up, so as a very young person I made that decision.
I should perhaps not tell the House this because people will say I am a weird guy. Maybe I am. However we were very poor when I was young and my source of income, believe it or not, was to go up and down the ditches out in the country, pick up cast away beer bottles and sell them. If I remember correctly I received 20¢ a dozen for them which was big money. All I had to do was get five dozen of them and I had a dollar, and a dollar was big money to a young kid my age at the time. That is how I made some money.
Frankly, one of the reasons I never took up drinking was because I could not stand the smell of the stuff. Later one of my friends explained to me that there was a huge difference between a nice cold beer out of the fridge and a beer that has been sitting in the hot sun in a Saskatchewan prairie ditch for a week or so. I guess I did not have a fair sample of the product, but I decided I was not interested in it and would not use it. Over the years I have avoided paying a whole bunch of taxes on liquor products.
I have not suffered. I have not put other people at risk on the road, which is one of the hazards. It is a huge hazard. Many people get injured and killed every year because of drunkenness on the road. I know we are not talking specifically about that. However like many other things, drinking alcoholic beverages when taken to excess becomes an evil instead of a good.
I have no problem with people who like to have a nice wine with a meal and so on even though I personally do not. I say let them if they want to. Let them pay the taxes. It is a voluntary tax. I say let them pay the taxes to the government, as Bill C-47 provides for, and enjoy it with their meals if they wish.
However I have also said I do not believe in drunkenness. I do not care if people drink but I think drunkenness is wrong. The only way a person can avoid drunkenness is by saying no to a drink. Being a person who is somewhat weak I decided it was easier to say no to the first one than to any subsequent ones. That is how I came to that conclusion.
I will say something about the whole issue of taxation on alcoholic beverages and cigarettes. One of the reasons we have taxes on these products is because we think we can somehow reduce overconsumption of them. It is to achieve a social outcome. We would probably be surprised if we thought about this and its long term ramifications.
I read not long ago that approximately 100 people every day in Canada lose their lives due to the effects of smoking cigarettes. I am talking about heart disease and lung cancer that is directly attributable to the use of cigarettes. Around 35,000 to 40,000 people a year in Canada lose their lives prematurely because of the use of that product.
I have often thought of it this way. We members from the west are required to get on an airplane pretty well every week to head out to our ridings. Most of the time the airplanes have about 100 people on them. If one of those airplanes were to go down every day I would be going by train. I would decide the probability was not in my favour. If 100 people in Canada every day were losing their lives on a particular kind of airplane I would not go on that kind of airplane. I would find another means.
Yet people across the country are quite willing to smoke cigarettes recognizing that 100 people every day in Canada lose their lives because of that choice. It is a strange thing. The same is true for the overuse of alcoholic beverages. Every year literally thousands of people are injured and killed because of the abuse of alcohol.
This is an appropriate time for us to say to Canadians that there is no excuse for drinking and driving. It should be an automatic that if one drinks one should make other arrangements for transportation. It is not right to risk other people's lives, health, safety and property.
I will get back to the taxation issue. We have had a bit of controversy with respect to taxation of alcoholic beverages. I did a few calculations which are rather interesting. Bill C-47 would continue to tax breweries in Canada according to a formula. I am not sure whether it would increase or reduce the amount for small breweries. However in the notes someone gave me it says there are speciality brewers in the United States who get a 60% reduction on a certain amount of production every year to account for those who are small operators.
We recognize and use that principal in Canada when it comes to personal income taxes. People here are quite willing to say persons with low incomes will earn a certain amount of income before they pay any tax at all, persons at the next level will be taxed at a low rate, and persons past a certain threshold will pay an increased rate. We have what is called a progressive tax system. I will not diverge today into the merits of a tax system where the rates are closer together, but we accept this system for individuals yet we do not want to accept it when it comes to small businesses.
The numbers are quite astounding. It says in my notes that small brewers produce less than 300,000 hectolitres per year. I do not know whether many Canadians are yet into the hectolitre form of measurement. I did a little calculation to bring it down to where we can recognize it. I found that 300,000 hectolitres per year works out to roughly 82,000 litres per day. A small operator is one whose production accounts for less than 82,000 litres per day. There are people who think it would be justifiable to give those in the small business bracket a lower rate of taxation or even a total exemption.
We should go beyond simply being competitive with our American neighbours in this regard. We should make sure industry and all sectors have an advantage by being in Canada. We should be better than our big American trading neighbours. People should be eager to do business in Canada and stay here. They should not want to go afield and take their business out of the country to the United States, Mexico or wherever else.
The Liberals have shown they not only push and pull at the same time with respect to the tobacco tax. They also seem to be all over the place from time to time. In 1994 they were busy increasing the tax. In 1995 they cut the tax. Here we are again increasing the tax. Maybe it is a grand experiment and we do not know we are part of it. The Liberals love playing with taxes and changing them.
We ought to recognize the fact that the government has an insatiable appetite to reach into the pockets of Canadians be they rich or poor and take as much money as it can. The Liberal government has a bleak record in terms of recognizing and respecting the collective wealth of people in the average or below average income brackets. They are taxed to death.
We can add to that the horror of watching the government take billions of dollars away from the thousands of workers who contribute to the EI program, as they call it, and roll it into general revenue. I do not know if members are aware of this, but the total amount the government has applied to the debt reduction it likes to crow about is no more than the amount it has taken out of the EI fund. The government has said to poor people and members of the working class who must pay into EI that they are the ones who will pay down the debt.
[Intervention]
An hon. member: It has stolen from them.
Ken Epp: As my hon. colleague says, the government has stolen the money from them. There is no recourse. People in insurable employment must pay whether they like it or not. The government seems to take great delight in doing this. It has overcharged in premiums and cut benefits. It ought to hang its head in shame.
The government has reached into the pockets of federal civil servants and taken $30 billion out of their pension fund. Total assets in the fund had grown beyond expectation and it is not unreasonable to say the moneys should be taken back by the employer. However it should only have been the portion the employer paid in. The government totally ignored the fact that the pension fund surplus was a combination of the contributions of employees and employers who are the taxpayers of Canada via the government.
Yes, taxpayers are entitled to get some of the money back. I do not argue with that. However the government took it all. Federal civil servants who contributed to their pension fund had their money taken away from them by a government in a majority vote with no regard to what it was doing. Over and over we have seen the government's insatiable appetite for separating Canadians from their hard earned dollars. This must end.
While I support Bill C-47 in broad principle I do so reluctantly. I do not buy into the philosophy that says the end justifies the means. I have considerable hesitation in supporting a bill that would presume to reduce smoking by increasing taxes. The outcome, as good as it may be, should not be used to justify increasing the taxes of Canadian citizens.
In conclusion, I appreciate the opportunity to again speak to Bill C-47. The government will probably continue its policy of tax grabs and wild, unaccountable spending. I would rather exert my efforts in replacing them on that side of the House. Let us get rid of the Liberals and put into their place a responsible government that treats the taxpayer with a careful and fully accountable trust.
Yvan Loubier: Madam Speaker, I thank you for this opportunity to speak to Bill C-47.
We have a situation that has almost never arisen in the ten years I have been a parliamentarian. We have, on occasion, supported or rejected government bills. The situation was clear at the outset and equally clear at the conclusion.
But with Bill C-47, the situation became complicated during consideration in committee, when we suggested that the Bloc Quebecois could support the bill. When a mockery was made of the committee consideration process all the way to report stage at third reading, we backed off, because the bill before us is not the bill that should have made it to this stage.
The bill that should have been before us was a bill for which votable amendments to include the issue of beers and the reduction of the excise tax on microbrewery beers would have been allowed.
Let me summarize briefly the background of Bill C-47. “It re-enacts existing provisions in the Excise Act and the Excise Tax Act relating to the excise levies on these products, together with technical improvements, and incorporates a range of new provisions”.
What is a bit unseemly and could even look bizarre at first glance is the fact that the Excise Act is general legislation of broad application affecting all products mentioned in Bill C-47, as well as beer.
In other words, the only part that was omitted in Bill C-47 is the part on beer. When we speak to legal drafting people from here and elsewhere, they all find it unseemly that we modernize the Excise Act with Bill C-47 and that we find ourselves in a position where all products and all provisions of the previous act, allegedly to be replaced by Bill C-47, are all in the new bill, except one.
In the current Excise Act, before it is replaced by Bill C-47, wine, spirits, beer, tobacco and distillery products are all mentioned. There is reference to breweries and tobacco products. The act deals with everything, every single product touched by excise. There are provisions on licensing, rights of accession, offences, collection, record, accounts, required documents, warehousing and remission of duties or what they call drawbacks in international trade. It touches on absolutely every point. Bill C-47, which is supposed to bring that Excise Act up to date, also deals with absolutely everything, except beer. That is the bizarre aspect of this bill.
Let me explain what happened since 1997 for us to be presented with the proposal for the amendment and modernization of the Excise Act contained in Bill C-47.
Since 1997, there have been discussions between the Department of Finance and various stakeholders with a view to modernizing the excise system to reflect the new realities that were covered by the current Excise Act, for example ship's stores on vessels travelling from Canadian ports to foreign ones. Part of these stores are used to provide the crew with food and drink, whereas the rest needs to be considered export products or products on which there are transactions.
Then there is the tax system, which did not take into account modern warehousing methods. Now the excise tax that was to be charged on sales is charged at the time of production, with consideration of prior revenue. In short, a number of aspects had to be modernized.
Since 1997, many people have been involved in drafting the new excise scheme, particularly the Brewers Association of Canada. The majority of Canadian breweries are members of this association, but it is dominated by the two major breweries, John Labatt and Molson.
Since 1997, the Brewers Association of Canada has been saying “It is a good idea to change the excise régime in the general Excise Act, which Bill C-47 claims to replace, in order to reflect the fact that the small breweries, with a production of less than 300,000 hectolitres annually, may benefit from the same excise scheme as their American and European competitors”. The difference is not insignificant, when we compare the excise tax the Canadian government charges Canadian breweries and what is done in the U.S. and in Europe. I will give a few figures.
Whereas, generally speaking, there is a charge of 28 cents Canadian per litre of beer for all Canadian beers, the rate in the U.S. is about the same for the major breweries, the counterparts of Molson or Labatt but, in that kingdom of capitalism, the charge is only 9 cents per litre for microbreweries. The United States definition of a microbrewery is one producing less than one million hectolitres annually. This is far higher than the Canadian figure of 300,000 hectolitres.
If you are an American microbrewery, or in other words produce under one million hectolitres of beer a year, you benefit from a preferential excise charge that comes to around 9 cents a litre.
For our microbreweries, defined as breweries producing up to 300,000 hectolitres, there is no preferential rate, because they pay exactly the same excise tax, as set out in the Excise Act, as the big breweries. Which means that microbrewery beers from the U.S. that enter on the Canadian market have an unfair competitive advantage, because they have a lower excise tax than our Canadian and Quebec microbrewery beers.
It is the same thing with Europe. They have the exact same preferential tax rate, which is accepted under the WTO rules. These rules make exceptions in specific cases—for example in cases related to the need to diversify the economy, or for the purpose of regional development or for originality to counter the standardization that comes with globalization—where there can be preferential excise tax measures for small businesses, which is the subject of Bill C-47.
Allow me to provide a few examples with figures. For 24 bottles of microbrewery beer produced in Canada, the federal government gets $4.09, when this beer is sold at a grocery store. When it is sold in an establishment such as a bar, the government gets $6.12 per 24 case of microbrewery beer. Are members aware of what the excise tax paid in the United States is? Bill C-47 includes a review of the excise tax, a review from which the microbreweries were excluded. In the U.S., the excise tax on 24 bottles is $1.12. Compare that to the $4.09 and $6.12 charged in Canada.
How do we expect the microbreweries in Quebec, Ontario, western Canada, British Columbia and the maritimes to compete with these beers? It makes no sense.
That is why the Brewers Association of Canada has claimed to be defending the microbreweries since 1997. Publicly, they have said, “There needs to be a lower excise tax rate for microbreweries. We, the big breweries, like Molson and John Labatt, we can afford the full excise tax. We are strong enough to pay it. And the WTO would not accept it with us, as they would for microbreweries”.
This was done for microbreweries in the United States and in Europe. It is accepted, generally accepted, but not for the big breweries.
From 1997 until very recently, we thought the Brewers Association of Canada was standing up for microbreweries. That is until Bill C-47 came up. Then we realized that even though it was a bill aimed at reviewing the whole excise system, the Brewers Association of Canada was recommending that the finance department not include in Bill C-47 the beer produced by microbreweries and an excise tax reduction.
They were proposing to exclude them. It was not because that was not in accordance with the system we wanted to amend. Quite the contrary, as I showed earlier. The current Excise Act affects all products, including beer; all products are subject to Bill C-47, except beer. The finance department bought the arguments by John Labatt and Molson. It agreed with their arguments. Through the review that started in 1997, it took out from the current act, which includes the brewery industry, the microbrewery sector and possibility of reducing the excise tax.
Therefore, there is collusion, which is normally reprehensible under the Competition Act. If we were in the United States, I am not sure things would be working as nicely as they have been since 1997, with the cronyism existing between the government and the big national breweries as well as the cronyism and the collusion between Labatt and Molson against the microbreweries to kill them.
Since 1997, we thought that the big breweries were advocating a preferential rate for microbreweries, with regard to excise tax. That was until Sandy Morrison, Chairman and Chief Executive Officer of the Brewers Association of Canada, with a majority representation from John Labatt and Molson, sent a letter to the hon. member for London West who also chairs the Standing Committee on Finance.
I would like to quote some excerpts from this letter on Bill C-47 and show the point of view of the Brewers Association of Canada. Mr. Morrison said:

On behalf of its 28 members, big and small—

He insists a lot on “small” throughout his letter.

—the brewers association has pressed for a reduction of the excise tax as an essential measure for the immediate and future health of this sector of our industry—

He was referring to microbreweries.

We explained our views during meetings with the Minister of Finance, senior officials from his department, the finance committee and hon. members. However, the industry does not agree that such a change should be done through an amendment to Bill C-47.

I would like to point out something. One wonders why beer should be excluded from a general review of the excise act, which currently applies to beer, wine, spirits and tobacco. If representations that take into account the particular needs of microbreweries and ask for a reduction of the excise tax should be welcomed with regard to such a bill, we wonder why those who claim to protect microbreweries, and who say that a reduction of the excise tax is essential to their survival, would not take an opportunity such as the general excise review under Bill C-47 to immediately demand a reduction of the excise tax.
I continue with the letter:

However, the industry does not agree that such a change should be done through an amendment to Bill C-47, which is currently before the House and which proposes a new excise framework for producers of spirits and wine in Canada. Following extensive consultations on the proposed changes to the Excise Act, brewers concluded, with the Minister of Finance, that there is a lot to do to develop an appropriate program for the beer industry.

Again, I want to point out something. The letter says that there is a lot to do. Either these people are lazy or else they lack imagination when they make such a comment. All it takes is three paragraphs. One that defines microbreweries, one that talks about the excise tax on beer, and one that ensures that Canadian and Quebec microbreweries benefit from a 60% reduction of the excise tax. This is all it takes.
I cannot believe that, from 1997 to 2002, they found it complicated to include beer. Yet, everything is in Bill C-47. Any product found in the current Excise Act is still there, except the beer produced by microbreweries. This is rather surprising.
Mr. Morrison, of the Brewers Association of Canada, goes on as follows:

Instead of delaying matters of interest to the other sectors, it was decided to exclude brewers from this legislative measure and to deal with the industry separately once parliament has passed the amendments concerning the other sectors. This measure has the approval of members of our association, big and small alike.

Small keeps coming up. He has a thing about small.
I have a small piece of news for them. We learned that the Brewers Association of Canada, dominated by John Labatt and Molson, were not defending the microbrewers. It was being hypocritical for, although it said it supported them, when it came time to take action, it said, “No, now is not the time. We would rather see the other sectors benefit, not us”.
These are major lobbyists. They defend their members' interests. It is time to amend the excise regime, it is time for a reduction in the excise tax for microbreweries, and the representatives who say they are defending the microbreweries with the Brewers Association of Canada say, “No, no, do it for the others; we are altruistic; we want things to go well for the others, but not for us. We will wait till a little bit later”.
Do you know what the major Canadian brewers are waiting for? Since 1997, almost half of the Canadian microbreweries have disappeared from the map. If the member for Rimouski-Neigette-et-la Mitis were here, she would say, “Pouf”.
Since 1997, 38 Canadian microbreweries have disappeared from the map. Why? Because of the excise regime which should have been amended by Bill C-47, because it is part of the general amendments to the Excise Act the government is seeking. Thirty-eight of 86 microbreweries have disappeared. They have disappeared everywhere, not just in Quebec. Do not think that because the Bloc Quebecois defends Quebec in particular we are not able to walk and chew gum at the same time, to defend Canada as well, when our interests are the same.
In this case, we must fight against the big breweries, which are hypocritically claiming to defend the microbreweries and regional development. We must make sure that the microbreweries of Quebec and of Canada receive the same fair treatment as those in the United States and Europe. This is something the Bloc Quebecois is fighting for, and it is a cause that all members of this parliament should take up.
These brewers enjoy 90% of the market and they are still not happy. They have adopted predatory practices, and hypocritical ones at that.
Thirteen microbreweries have disappeared in Ontario in the last five years. Eleven have closed in Quebec, in various areas including Quebec City and LaSalle, in the Minister of Finance's own riding. I imagine that he was happy to see the Brasal microbrewery disappear, because it was beginning to compete with John Labatt, which is also located the minister's riding.
In Saint-Hyacinthe, two microbreweries have disappeared since 1997. Others have closed in Saint-Eustache, Baie-Saint-Paul, Amos, Montreal et Cap-Chat. The regional development of microbreweries, the diversity, the wealth, the originality of a product, all that counts too. Seven microbreweries have disappeared in British Columbia, five in Alberta, one in Manitoba and one in Nova Scotia, for a total of 38. There are about 40 left; I unfortunately do not have the exact figures.
This is what the major Canadian brewers are expecting. This is what Mr. Morrison's letter means. It says “Do not include this in the Bill C-47, even though it is a general review of the excise system. Do not include it now. Wait one year, two years, three years, four years, five years”.
According to my numbers, if we were able to make 38 microbreweries disappeared in five years, we will probably be able to make the other 40 or so disappear in six years. So let us wait. Some people will say “ If they already have 90% of the market, this must not be important. Microbreweries currently have 4% of the market”. They had almost 5.5% of the market five years ago. However, because the excise system has been maintained, as it is today, they have disappeared. This is the main reason for their disappearance.
Every time the major Canadians brewers recover 1% of the market left by bankrupt microbreweries, this 1% represents dividends to shareholders of $17 million in net profits, $17 million for each slice of 1%. Killing the microbreweries is therefore a good idea.
This is why, a few years ago, microbrewers, smart people like you and me, decided to create, for this particular issue, the Canadian Council of Regional Brewers, which really represents microbrewers.
The president is Bob King, the President of Big Rock Brewery, an Alberta beer producer. The vice-president is André Dion, of Unibroue, in Quebec. The general manager, who was criticized by Mr. Morrison in his letter as representing no one, is Pierre Paquin, who is doing excellent work. With Mr. King and Mr. Dion, he is really fighting for the interests of microbreweries not only of Quebec, but of the rest of Canada. They are real fighters.
They created the Canadian Council of Regional Brewers, and they have had it with the collusion between the big Canadian breweries and the Department of Finance. They have had it with the collusion and the conspiracy organized them by the big brewers such as John Labatt and Molson, against the microbrewers, with the complicity of the Liberal government. They have had enough. That is the message they conveyed to the Standing Committee of Finance, two weeks ago, when they appeared before it. That is the message they expressed again these last few days, particularly with what happened in the Standing Committee on Finance, when the amendments moved by the Bloc Quebecois were discussed.
To complete the description of Canada's microbreweries sector, I will say that, since 1997, we know that the microbreweries have lost between 1.2 and 1.5% of the market. And this is because of the disappearance of 38 microbreweries, which, of course, was caused by the continued existence of an excise system that makes no sense at all, that is totally unjust and unfair and that, on a commercial point of view, tolerates, on the part of this government, unfair competition by American and European microbrewers on our own market. These great Canadian nationalists cannot even put in place an excise system that is competitive with its main competitors. These competitors are hurting our microbrewers, who are losing their share of the market. And this is being done in collusion with our big brewers. What a mess.
It is not surprising that 70% of the people believe that politicians are corrupt. When we see this sort of thing, that is collusion between the two big Canadian breweries and the federal government, particularly the finance minister, I am not surprised to see that so many people believe that politicians are corrupt.
Not only are we not changing the excise system to help the microbreweries but the Canadian major brewers get beer supply contracts for imported beer from microbreweries. They then sell the microbrewery products and specialty beers on the Canadian market.
Not only do the American and European microbreweries themselves supply the market, the major brewers take exclusive contracts to supply the Canadian market with microbreweries products and specialty beers. That is the case with Corona, Sol and others.
These contracts have already increased 175% since 1997. This increase benefits the major brewers, which also claimed to support the microbreweries in Canada and in Quebec and to agree with a lower excise tax. The cat is out of the bag now that the general excise system is changed by Bill C-47.
As I said, each 1% slice of the market allows the major brewers to get $17 million in net profits for their shareholders. This is what happens each time they gain 1 of the market at the expense of the microbreweries. That is a lot of money.
That means that if they killed all the microbreweries, in today's dollars, taking into account the actual consumption and sale structure, they would pocket $68 million in net profits. And then they say, “We stand for the microbreweries”. We can understand these big companies. Sixty-eight billion dollars for their shareholders, that is a lot of money. The exclusive contracts they have with the foreign microbreweries whose products they sell on our markets are also profitable. There has been an increase of 175% since 1997.
There is a lot of money involved. There is a lot of money to be made. There is also a lot of hypocrisy and collusion. As I was saying earlier, the competition legislation in the United States is very strict. Even Bill Gates had a taste of it. He was forced to divide his operations in two because one operation could not look at the other without compromising consumer interests.
Here we have a situation where not only there is collusion between Labatt and Molson to prevent a reduction in the excise tax—that alone would be unacceptable in the United States; I would be curious to see that—but there is complicity on the part of the government.
Even Mr. Morrison says in his letter “Our position remains unchanged”. When I read that, I was touched. The letter goes on to say:

Our position remains unchanged: we fully support a reduction in the excise tax for small brewers. It is a priority of the BAC—

If it were a priority, it seems to me that they would have wanted it to be done immediately; when we say that something is a priority, we do it right away; for them, it does not matter if it happens four or five years from now.
And he adds:

—and we want to point out that small brewers in Canada urgently need such reduction.

I am trying to understand. Words are pretty powerful things. A priority is something that must be done right away, and urgency is even stronger than that. It is worse than a priority. A priority is an administrative thing; an urgency, an emergency, is about self-preservation. If it is an administrative priority, and if it is about self-preservation as well, than it is a matter of urgency, so how could the letter continue in this vein?

We will support any measure aimed at attaining this objective, but in light of our prior agreement with the government—

Here we have another strong word, an agreement, “our agreement”. This is a way of saying that “with a gentleman's handshake, we are going to do them in, those microbreweries. They are going to get it in the neck, no excise tax reduction for them.” That is what the reference to an agreement means. Continuing with the letter:

—in light of our prior agreement with the government, we cannot support amendments which would include beer in Bill C-47.

The Brewers Association of Canada is a powerful lobby. It exists to defend the interests of all its members, big and small. But when the time comes to do so, they say, “We cannot support amendments which would include beer in Bill C-47.”
If I were a member of the Brewers Association of Canada, I would have left it ages ago. There would only be the two giants left. At least things would be clear. John Labatt and Molson do not want to see the small companies survive. But this way, it is not so clear. It is a good thing that the Canadian and Quebec microbreweries have reacted by forming their own association.
This is not the end of the matter. If it were, the situation would be bad enough, but it does not stop here. When we moved the amendments to Bill C-47, to bring it back to the spirit of the original excise legislation, which they claim to wish to amend and indeed totally rework, we told ourselves that beer had to be included in it.
In the present Excise Act, there is not only wine, spirits, tobacco and ship's stores, as is the case for Bill C-47, but also the beer the Brewers Association of Canada wanted to see excluded, even if this is the appropriate time and place for a reform of the excise tax on beer.
I then said, “Let us move amendments with the support of small brewers”. The amendments were moved, and refused because they were out of order.
Since Government Motion M-2 was moved, a committee chair is very powerful and has the right to refuse or accept amendments. The process ends there, because we cannot bring forward amendments to Bill C-47 at report and third reading stages. This is different from what we were accustomed to in the past.
A committee chair is now the holder of a powerful public office. That person wields more power than a secretary of state or a parliamentary secretary. At times, he or she even wields more power than a minister. Even a minister cannot refuse amendments like this. If those amendments were moved here, the minister would have to rely on the members' votes to have them rejected.
However, the chair can now refuse amendments just like that, and nothing can be done about it. We have no recourse, no appeal procedure that would give us a chance to express our point of view. This is tremendous power.
As I said, the Brewers Association of Canada sent a letter to the member for London-West and chair of the Standing Committee on Finance, indicating that the excise tax on beer should not be included in Bill C-47. It is not because it could not be there, it is rather because they did not want it there.
The Brewers Association of Canada, an organization dominated by John Labatt and Molson, has a committee known as the taxation committee. After analyzing Bill C-47, its recommendation was that beer be excluded. The President of the Brewers Association of Canada taxation committee is the husband of the member for London-West, John Barnes.
Now back to Bill C-47. It should have included everything in the current Excise Act to amend the provisions. The Brewers Association of Canada said, “Yes, include everything, and it is not in violation of the previous Excise Act, except for beer”. This main recommendation comes from the taxation committee, which is chaired by one of the seven directors of John Labatt, who is also the husband of the chair of the Standing Committee on Finance.
We were told that since the chair of the Standing Committee on Finance was not a minister or a parliamentary secretary, she was not subject to the code of conduct. This is a serious admission. As I mentioned, since Motion M-2 moved by the government committee chairs have tremendous powers in the legislative process. They can accept or reject amendments that are proposed. In a tie vote between opposition and government members, chairs can rule, in other words, vote either way, and do not have to say why they voted for or against the amendment. These are considerable powers.
Even here in the House, ministers must commit, they must explain themselves. Even here, ministers could not rise and say, “This is not admissible as an amendment”. They would not be able to say this if we could still introduce them in the House of Commons. There should be a vote in the House on opposition amendments, with members from all political parties.
Under the code of conduct, the responsibility of the chairperson of the Standing Committee on Finance is not that of a public office. However, I recall the case of Sinclair Stevens in 1986. Mr. Justice Parker, who presided over Mr. Stevens' case when he was accused of 14 counts of conflict of interest, said the following:

The code of conduct must be strengthened. It must become law.

Information regarding spouses and dependent children must also be made public for all those in public office.
In 1994 there was a review of the code of conduct. It was not expanded, but the Liberal party said that in cases where there is an issue of conflict of interest, such as the current situation with the chair of the Standing Committee on Finance, the occupation and all of the information regarding spouses and dependent children became relevant.
This has no teeth. The code of conduct is so weak. It was really stupid on the part of the ethics counsellor to present such a thing. However, there is an indication that information on the spouse and dependent children of a member of parliament who holds public office becomes relevant in the case of a conflict of interest analysis.
The hon. member for London West could have been a man. It would have made no difference if she had been a man and John Barns were her brother, father or son. The code of conduct of the government is so weak that the situation of the spouse would be considered as important.
We have a situation where there is at least an apparent conflict of interest. I will now come back to the summary of Bill C-47.

It re-enacts existing provisions in the Excise Act and the Excise Tax Act relating to the excise levies on those products, together with technical improvements—

At present, the general excise legislation contains provisions on wine, spirits and tobacco and numerous provisions on permits, licenses, etc., but also various provisions about the brewing industry and beer.
It would be absolutely incongruous to exclude such an item at the request of the Brewers Association of Canada, since that request was based on an analysis by the taxation committee of the association, whose president is John Barnes, the spouse of the chair of the Standing Committee on Finance.
I repeat, since Motion M-2 put forward by the government, a committee chair has extraordinary power in the legislative process. We no longer have any right of appeal or recourse once amendments put forward by opposition members or a government member are rejected by the committee chair. This is now an incredibly powerful public office in the democratic process.
Even though, under the existing code of ethics, which is very flexible to say the least, a holder of public office includes a minister, a deputy minister, senior officials, secretaries of state and parliamentary secretaries, it should include a committee chair whose responsibilities were increased by Motion M-2.
Conflict of interest, and the appearance of conflict of interest, is not just a matter of a code, and certainly not a flexible one. This is how she can present us with any old legal opinion. It is a matter of judgment, of honesty, of integrity, of transparency, and of intelligence.
Never, anywhere, has the chair of the Standing Committee on Finance told us, since consideration of Bill C-47 first began, that she was related to one of the seven directors of John Labatt, to a director of the Brewers Association of Canada and, to top it all, to the chair of the taxation committee for that same Brewers Association of Canada, which was not favourably disposed to an excise tax reduction for microbreweries. Never has this been mentioned.
And when did she flash her famous legal opinion? When I caught her red-handed rejecting my amendments and told her: “You are no longer entitled to make any decisions about Bill C-47 because you are clearly in conflict of interest, because your husband is the chair of the taxation committee of the Brewers Association of Canada, which recommended that the microbreweries be killed off over the next few years, having already killed off 38 of them”.
If that is not a conflict of interest that the government wanted to give a different spin to yesterday by dragging a legitimate debate on the place of women in society into a debate about integrity, about conspiracies against the microbreweries, about influence peddling, complicity and collusion, we have quite a problem.
The Minister of Finance got caught in the act recently, and the Minister of Canadian Heritage too, with contracts being given left and right to the organizers of their leadership campaign. After such a blatant case, is it so surprising that 70% of the population is fed up with politics and thinks politicians are corrupt?
Had the hon. member for London West been a man, with his brother chairing the taxation committee, it would have been the same thing. They are distorting this debate.
What kind of doormat members do we have opposite, that they should allow such an establishment, and the collusion to go on between this government, which is standing up for the interests of the majority, of the big breweries, at the expense of the microbreweries?
There is one way to turn things around. The government should immediately begin drafting a bill it would introduce before the end of this session, in order to do justice to the microbreweries.
It is imperative that the microbreweries, with their 2,000 jobs, can survive and prosper. We should put an end to this collusion between the big breweries, the government, and the chairperson of the finance committee, who happens to be the wife of the chairman of the taxation committee of the Brewers Association of Canada.
That is what we are asking the government. Because of this hypocrisy, collusion, conspiracy and lack of honesty, we will oppose Bill C-47. It certainly contains good provisions, but—
The Acting Speaker (Ms. Bakopanos): I am sorry to interrupt the hon. member, but his time has expired. The hon. member for Palliser.
Dick Proctor: Madam Speaker, I too am pleased to discuss Bill C-47, an excise tax act. This is a technical bill as has been pointed out by all of the previous speakers. It would impose a levy on spirits, wines and tobacco products but not on beer as the member for Saint--Hyacinthe--Bagot has so eloquently concluded in his lengthy speech. It would defer payment of duties on spirits and wines to the wholesale level, place domestic and imported products on an equal footing, impose tight controls on possession of non duty paid products, et cetera. It is a technical bill, as I say, that would implement some tax changes.
We are talking about changes with respect to spirits, wines, tobacco and ships' stores. In part we are talking about how the government prosecutes and collects taxes on illegal products, contraband tobacco and spirits and how we impact on the smuggling of alcohol when it is ferreted out. The government says the CCRA will improve the service and we certainly hope so. We know the taxpayers at large have concerns. We hope that the improvements to the service will not just be on the government side of things but will impact those who pay the taxes as well because we often do not see that in our constituency work.
We are told that administrative penalties and excise duties will be collected more effectively and efficiently. There is a new framework, added measures and changes to ships' stores. Because of a recent court of appeal decision the ships on the Great Lakes will be eligible for a fuel tax rebate beginning this summer and extending into 2004, which amounts to a transition period. There will be a uniform tax on cigarettes, which I will come back to in a moment, in co-ordination with the provinces and territories, and is restored to the pre-1994 level. Obviously one of the goals, among others, is to reduce tobacco consumption. We are told it is a new, modern legislative framework that addresses the concerns of industry and government.
On the issue of the tobacco tax we know what happened. Earlier the member for Elk Island talked about the taxes going up in 1994, coming down in 1995 and they are now going back up again in this area. There was a reason for it and I think the member would acknowledge that.
At that time there was a major problem in western Canada with contraband tobacco. There was a difference in the price of tobacco products. They were higher in western Canada and lower in Quebec and Ontario. As a result, there was a lucrative market for people who were willing to smuggle products from province to province.
There was a significant problem with the tax levels in western Canada. As a result the excise tax was reduced in 1995 after having been raised in 1994. The problem seems to have abated in recent years and we are now at a uniform tax level. That is commendable.
The member for Elk Island also talked about taxes being a drain on our economy, that the money should be kept in the hands of entrepreneurs and that redistribution does not help and in most cases is detrimental. Our country has a pretty high standard of living, a fairly good quality of life that is recognized, with some exceptions, by the United Nations. It is because of the redistributive effect in Canada. In the past we have tried to make things more equal to make sure there is a basic standard of living that is relatively fair to people in all parts of Canada wherever they may reside and work. It does not work as well as some of us would like to see it work, but over the years it has proved to be successful.
I certainly would disassociate myself from the remarks of the member for Elk Island. However I will not disassociate myself with him when he talks about the use of tobacco and its effects because I think he is spot on there. Although I would note that we restrict advertising on the use of tobacco products, unlike some other jurisdictions. We certainly have a very active program in terms of curtailing youth from taking up smoking. Frankly, raising the price of tobacco products is one way to reducing that and trying to stamp it out.
On the tax level itself, we seem to have in recent decades a preponderance of taxes that are aimed at the personal income tax level. When I was much younger, the money collected annually on corporate taxes amounted to about half of all the money the government collected and spent in a year and the other 50% came from personal income tax. That has shifted very dramatically. Now somewhere in the neighbourhood of 85% of all revenues collected by the federal government comes from the personal income tax and only 15% comes from the corporate tax.
If we had a fairer tax system, some of these increases that we have come to know, expect, anticipate and that hit out in the sin taxes, wine, spirits and tobacco, would not have to be raised to the level they have been. However they are required because a good enough job has not done in ensuring that corporations pay their fair share of taxes as well.
I very much enjoyed the lengthy dissertation from the member for Saint-Hyacinthe--Bagot. As a member of the finance committee, he understands and has followed this issue extremely closely, particularly the fact that beer is the only product in this spirit and alcohol portion of Bill C-47 that is not covered. He went through that in meticulous detail and explained exactly what had transpired.
We saw that being played out in the debate in the House this week. It is regrettable that the chair of the finance committee did not indicate the position she was in, not only the connection in terms of her spouse and where he is employed, but the fact that she has received a fairly generous political donation from the company her husband is employed with in London, namely the John Labatt breweries. That would have been the right and honourable thing for the member for London West to have done, and it is unfortunate that that did not transpire in this instance.
Although we indicated our caucus would be supporting the changes to the bill, we may very well want to reconsider our position in light of what has transpired over the last and recent days.
I do not intend to take very much time this afternoon, but in some of the cases such as tobacco it is important we have that high level of taxation to discourage children and young people from taking up a habit that is costing lives and billions of dollars to our health care system. We need to encourage healthier, happier lifestyles. We would all be better off, smokers and non-smokers alike, if there were far fewer smokers puffing on a regular basis
We will be reconsidering and thinking through our position on the bill very carefully in light of what has transpired and what has come to light in recent days.
Ken Epp: Madam Speaker, the member who just spoke invoked my name on a couple of occasions. He took some exception to the fact that I proposed that businesses, industry, entrepreneurs, investors and private individuals should be able to keep more of their money in their pockets and that the government should take less.
I would like to correct the misconception that he may have about that. I believe there is a proper role for the federal government, as there is for provincial and municipal governments. The fact is governments at all levels, but particular evident at the federal level, tax us to death and then seem to have no regard for the money that they have taken out of our pockets in the way they spend it.
The most recent example was on the last day of the fiscal year the Liberals bought a couple of new jets. They were not in the estimates. The Department of National Defence did not indicate that they were required. There was no justification for it as far as we knew. It just came out of the blue that the Liberals had a hundred million dollars to spend.
A hundred million dollars is an awful lot of money extracted from poor working Canadians who on every paycheque are required to forgo in some instances up to half their income in provincial and federal taxes. That is precisely what I am talking about. Instead of increasing the number of people who are totally dependent upon the government for their livelihood, if we left that money in the hands of businesses, entrepreneurs and individuals, our economy would be much better and everyone would be much better off than they are now.
That is my thesis and I stand by it.
Dick Proctor: Madam Speaker, what I thought I very clearly heard the member say was that all taxes were bad and if we could keep them in the hands of entrepreneurs and others, the world and especially this country would be a better place.
I do not disagree at all with what the member said in terms of the questionable expenditures on the two jets, particularly when our helicopters are so antiquated and in need of replacement.
A perfect example of what he is talking about is the employment insurance grab. In that case all the surpluses in recent years were as a result of the windfall which occurred in the EI fund. The fact is benefits have been reduced but the money which has rolled in has paid down the deficit and continues to be the bulk, if not all, of the surplus.
I think this gets to the heart of the point that I was endeavouring to make which was we do not have a terribly fair tax system. If we look at unemployment insurance in itself, it is paid into by students who have no intention or no ability to collect it in the coming year because they are returning to school. It impacts on seasonal agricultural workers who come into this country from Mexico, Jamaica and other places to work on our farms and in our agricultural processing industry. They pay unemployment insurance and they do not have a prayer in terms of collecting any of that money.
These are some of the things that the government needs to take into account. As I understand it, they do not actually come under Bill C-47, the excise tax, but it does get to the heart of some things that are wrong with our tax system at the moment.
Ken Epp: Madam Speaker, I am glad the hon. member brought up the question of EI and the fact people are required to pay into it who do not have any hope at all of collecting it.
Way back in the 1950s when I was a student at university I remember writing a letter to what at that time was the unemployment insurance commission. I said I did not want to pay that premium because I was going back to school. I was ineligible to collect and that for me to be required to pay into a fund from which I could not possibly collect was a form of theft and I objected. I remember getting a nice letter back from the department saying that it was required by law and that it was my employer who was subject to penalty and who would go to jail if he or she failed to deduct it from me and remit it. I went to my boss and he said that for $2.40 a week he was not going to jail and that was the end of the matter. I remember being incensed at that time.
This gives me an opportunity to mention that I have never ever been drawn for private member's bills but one of my private member's bills addresses exactly this question. It would ensure that if individuals at the end of the year were to show ineligibility for employment insurance because they were returning to school, or for any other reason, then they would be able to get a refund of the premiums. That is one of the private member's bills I am working on. I have not yet submitted it to the House but it is in the works. I would like to say that every once in a while we agree with those guys at our far left when there are a few common sense things.
Dick Proctor: Madam Speaker, I hope the member for Elk Island completes his private member's bill quickly and hope it is drawn at the next occasion.
Marcel Gagnon: Madam Speaker, I do not know if I will be able to express my thoughts in three minutes, but I think the hon. member will get my drift.
The longer a member sits in this House, the more he or she realizes that, for justice to be done, one has to be big, strong and in collusion with the government. We see the case of microbreweries, which the hon. member for Saint-Hyacinthe—Bagot has explained; in my opinion, this is scandalous.
The hon. member talks about employment insurance. I think of the $3 billion the government saved at the expense of the least well off in society, that is the elderly who were eligible to the guaranteed income supplement; this money will to used to pay the debt of the rich. I find this outrageous.
Does the member agree with me, or will be contradict me on this point?
Dick Proctor: Madam Speaker, I agree with the member's view. I endeavoured to say in my remarks that we have a growing gap of inequality in our taxation system. We are reversing the Robin Hood principle and taking far too much from people at the lower end while the people at the higher end seem to be enjoying more of the benefits. This is one of the things that the Bloc Quebecois and the New Democratic Party of Canada agree on. We need a radical change in our taxation policies to bring them into line to ensure that people are paying a fair rate of tax. We need a basic rate of tax for the large and powerful corporations as well as the large and powerful CEOs.
Scott Brison: Madam Speaker, it is a pleasure to speak to Bill C-47.
I do not think anybody in the House would disagree with the general notion that we ought to do as much as we can in this place and in the provincial legislatures to reduce the incidence of smoking in Canada and particularly smoking by young people.
I commend my colleagues in the provincial government in Nova Scotia who today introduced some of the toughest anti-smoking legislation that any province has ever introduced in the past. It is focused on reducing the incidence of smoking by young people. My province of Nova Scotia has a very high incidence of smoking.
[Intervention]
An hon. member: Like Quebec.
Scott Brison: Yes, like Quebec. That is right.
Smoking is of great concern to us, not purely from the perspective of health costs for the province, but from the human and social costs exacted on families and communities and the great loss of human potential. I commend the Nova Scotia government of Premier Hamm and his health minister Jamie Muir for their courageous efforts to reduce the incidence of smoking particularly among youth.
In a general sense, the term sin taxes is used with respect to tobacco and alcohol, wine, beer. It is a little harsh to call them sin taxes. We should be a little more ecumenical in the way we approach these sorts of things.
In some ways we should deal with tobacco, particularly cigarettes, in a different way than we deal with alcohol, particularly wine. As many of us realize, wine in moderate consumption is actually a positive health factor. Perhaps something I share in common with some of my colleagues from Quebec is an understanding of the relationship between the moderate consumption of good wine and the augmentation of one's health and longevity. Even if we do not live longer, we are certainly happier during our lifetime, which means something.
We ought to be dealing with cigarette taxes in a different way than we deal with taxes on wine or beer. In many ways wine and beer are very different from hard alcohol and spirits in terms of the nature in which they are consumed. Some people can consume alcohol in moderation and some people cannot. There is a difference.
Beyond that there is no doubt that raising taxes on cigarettes will have a positive impact in reducing the incidence of smoking. It has been clearly demonstrated that it will make a significant difference which is a good thing.
The government ought to work harder on smoking cessation on a national level. As well it should work with the provincial governments. It is very important to focus on the education side. California has been the leading U.S. state when it comes to educating people about smoking. The California government found that efforts focused on the education side of reducing smoking have been significantly more effective than tax efforts and some of its other initiatives.
Education can be extremely effective. Given the degree to which the provinces are charged with education, the federal government ought to work with the provinces. It should work with the provincial health ministers and the education ministers to introduce a more effective pan-Canadian approach through education in our school systems to reduce the incidence of smoking.
Recently I heard the Minister of Health speak about the importance of other lifestyle issues. She was speaking of fitness and levels of obesity in Canada. It seems counterintuitive in some ways if we consider that we live in an age when now more than at any time previous Canadians are more aware of food and the differences between healthful eating and less healthful eating. There were not fitness centres in every town or community 20 years ago. Today there are fitness centres everywhere and people are joining these fitness centres, at least in January; they may not go after February but they are joining. There is a greater consciousness in terms of health issues than has existed in the past.
When we go to a grocery store today the options in terms of low fat or non-fat, low flavour or non-flavour eating have never been greater. It seems in some ways inexplicable that we see greater levels of obesity, particularly with youth, than have existed in the past. Whether it is sedentary lifestyles we are seeing or perhaps the fact that extracurricular sports are receiving less funding on the provincial side largely because of the cutbacks on the federal side to the provinces, perhaps we have to address those issues as well.
I think that increasing excise taxes on cigarettes, booze and wine is pretty easy for the government, because the government finds raising taxes easy at any time, but I think it should find ways through creative and innovative policies, best practices and looking at jurisdictions around the world to address a lot of these other health issues, not just simply those where it sees an opportunity to raise taxes.
Further to some of the specific discussion around the application of these increased excise taxes to the duty free shops, I do not believe that these increases in excise tax should apply to alcohol and cigarettes sold in duty free shops. Duty free ought to be exactly that. Duty free is a different market. It is an important industry and employs a lot of Canadians. First, I think it is inconsistent with the nomenclature of duty free, but it is also extremely damaging to that important industry. As a trading country, if we are to take seriously the practices of other countries in terms of duty free and the competitive issues, it is clearly wrong-headed for these excise tax increases to apply to the duty free shops. I would argue that it is a mistake.
The argument that we need to address the tax disadvantages that our Canadian microbrewers have over their competitors elsewhere is a very important argument. Our Canadian microbreweries are at a competitive disadvantage due to our tax regime when compared to their counterparts in the U.S. There has been a significant growth in microbreweries in Canada. Aside from the jobs and the entrepreneurialism generated by microbreweries, there is another very important argument why we should defend them. Their beer tastes better. I think there are probably many in the House who would attest to the fact that microbrewers do produce good beer. I cannot myself, naturally, because I am hardly old enough to be able to consume alcohol legally.
I would argue that all other public policy criteria aside, I think sometimes we in the House should stand up for better tasting beer. I think Canadians deserve this--
[Intervention]
An hon. member: They deserve no less.
Scott Brison: They deserve no less, my colleague from the New Democratic Party has just told me, particularly now on a Friday when our hearts turn to the weekend. I think that Canadians watching CPAC today would agree with me that this is a public policy issue.
I see our pages in the House today. If we consider the interests of our young people, our pages and university students as they go forth and get older, I am sure the members opposite would agree that they should not be wasting their lives on bad tasting beer from large scale commercial breweries.
In a serious sense, I do commend the government for having addressed the health issues of cigarettes and the excise taxes on cigarettes. I do think we have to become a heck of a lot more innovative and creative than we have been in terms of creating public policy that is effective in reducing the incidence of smoking. Again, we have to treat moderate wine and alcohol consumption very differently from cigarette consumption. One cigarette is bad for the health but one glass of wine is not, unless one has an addiction. I would argue that we ought to be treating these a little differently.
In a general sense I do wish that we would see not just the government's predilection to increasing excise taxes but an actual tax reform package from the government focused on a wide range of issues such as that of enhancing and improving productivity. Our declining productivity levels, particularly the degree to which productivity growth in other countries has exceeded that of Canada, has had a very negative impact on our standard of living and quality of life and threatens significantly the standard of living we can depend on as we move forward.
The Canadian dollar has lost 20% of its value compared to the U.S. dollar since 1993, largely based on the fact that our productivity levels have been slipping compared to those of our largest competitor, the U.S. The Prime Minister says that it is all right, that our currency is doing better compared to some other currencies such as the ruble, but the fact is that given the degree to which our trade is focused on the U.S., the only comparison that really matters is the one with the U.S. Even if we look at some of our other trading partners like the U.K., our dollar has lost 15% under the government's watch against the pound sterling. Our dollar is doing badly compared to the Mexican peso, that great bastion of fiscal fortitude.
When we see a drop in the value of our Canadian dollar, it is a pay cut for every Canadian. The Prime Minister has stated that a low Canadian dollar is good for exports. Of course the logical corollary of that argument is that if we reduce the dollar to zero, Canada could be the greatest exporting nation in the world. That makes about as much sense as the Deputy Prime Minister when his industry minister made the statement that high taxes were good for productivity because they would make Canadian businesses and individuals work harder.
In a general sense I wish the government actually would address issues of tax reform focused on productivity, regulatory reform focused on productivity, interprovincial trade barriers that impede productivity, and the 10 different securities commissions in Canada, which are a bane to raising capital for growth and expansion. I wish the government would start thinking about some of these issues and be a little more proactive as opposed to always reacting to polls in responding to the challenges and opportunities that face Canadians as we look forward to what is an exciting but universally accepted as a more competitive century ahead of us.
Darrel Stinson: Madam Speaker, knowing the government's insatiable appetite for taxation, we should have more concern about this than just saying it is a health issue or some other issue. When we look at increasing taxes, particularly on alcohol and tobacco because they are easily exported, does the hon. member not have some concern of a black market creeping in that will be far more costly to regulate than what the government is setting out to do here?
Would it not be better if the government were to put some of these funds into education? Would it not be better to go to the schools and show a cancerous lung and a clean lung? I speak as a smoker. I am sure if we were to show grade 5 or grade 6 students what a cancerous lung looks like compared to a healthy lung it might impact upon them, whereas I never had that chance.
Would it not be better to take someone who is suffering or dying from asthma or cigarette lung disease into the schools to talk to the children? Would that not have a bigger impact than putting taxes on a product? Young people do not understand what taxation is and they are still going to steal a cigarette. Would the hon. member care to comment?
Scott Brison: Madam Speaker, I agree with the member that we must do more on the education side. We should be taking a portion of these excise taxes and using them exclusively for education, focusing on youth in particular.
I urge him to consider carefully the notion of cutting his lung out and taking it around to schools. It would be difficult for him to accomplish the latter if he performs the former. However if he is looking for a volunteer to help carry his lungs around I can help depending on whether I have the time.
There is the issue of photographs on cigarette packages. The law of unintended consequences sometimes says that one of the best ways to get teenagers or youth to do something is to tell them to do the opposite. It is perverse to even consider in some ways but I would bet that today there are probably young people, in schools or outside of schools, collecting these cigarette packages and trading gangrenous feet for cancerous lungs and that sort of thing. In all honesty, nothing makes a young person cooler than being told that it is absolutely wrong to pursue a particular behaviour. Of course I was a well behaved young person, as we know.
The issue of the black market is another important issue; it is not just black lungs. The government is ignoring the fact that if it were to raise taxes beyond a certain level there would almost definitely be a greater level of black market activities. I hope that does not happen.
[Intervention]
An hon. member: It will.
Scott Brison: Perhaps it will, but I still believe that higher cigarette taxes at the end of the day will reduce the incidence of smoking among young people. Perhaps there will be some incidence of black market increase but on the whole this is one tax increase that may actually be almost supportable based on its impact on reducing smoking.
Philip Mayfield: Madam Speaker, I am pleased to speak on behalf of the people of Cariboo--Chilcotin as we address Bill C-47, a bill amending the Excise Tax Act.
The Canadian Alliance is dedicated to reducing the size and scope of the federal government in order to deliver meaningful tax relief to hardworking Canadians.
Canadians face many difficulties inherent in complying with regulations and remittance schedules, often without keeping in mind the peace, order and prosperity of our citizens. Yet millions of Canadian small and medium size businesses prosper in spite of the federal government's insatiable appetite for tax revenues. We are severely overtaxed so I welcome the opportunity to participate in the debate today.
The official opposition supports the legislation. It has been endorsed by industry stakeholders. It modernizes the framework of excise taxation in wine, spirits and beer. This support is rare for the Canadian Alliance as we are opposed to the government's intervention into Canadians' freedom of choice by enforcing such a heavy burden of taxation. However, these proposals aim to replace existing old and antiquated administrative and enforcement structures governing alcohol and tobacco products with a modern regime reflecting current practice.
The bill does not address tax rate and base matters other than to ensure equitable treatment between domestic and imported products.
We have been talking about the various benefits of wine, beer and spirits. I appreciate what the hon. member had to say about the benefit of a glass of wine and perhaps the same can be said for beer.
I remember reading an article not too long ago in a magazine or a newspaper, I am not sure which, in which it stated that moderate drinkers have a higher income than abstainers or non-drinkers and immoderate drinkers have even higher incomes than moderate drinkers. I am not sure if that was an indication that people are not drinking enough. However, I do have to say that I worked on the streets of east Vancouver in my younger days and I saw some very heavy drinkers who were extremely poor. Therefore I am not sure of the benefits of alcohol consumption except as perhaps a doctor would prescribe.
The proposed act shifts compliance and point of taxation from sales levy to production levy for the production of wine, and this is already the case for distillers.
The changes introduced for spirits and wine are regulatory in nature and tax neutral. The prime purpose of these changes is to modernize how these products are taxed in order to allow distillers and vintners the greatest flexibility in their production practices and to ensure an internationally competitive tax regime .
From an industry perspective, the proposed legislation also provides for an appeal and assessment process. Previously industry had no recourse against government impositions if they felt unjustly treated.
The motion also contains significant enforcement tools to crack down on contraband products. This is a major feature of the proposed legislation and is welcomed by the industry.
Changes in the act make it easier to enforce existing laws and provide stiffer penalties for conviction. For example, under the proposed legislation the maximum fine for producing contraband alcohol would be fines up to $1 million and up to five years in jail for indictable offences. These are industry led changes and it is proposed there would be no losers because of the legislation, with the exception of those who produce contraband products.
Considering tobacco, the second aspect of Bill C-47 does have problems. The bill seeks to increase federal excise taxes on tobacco products and to re-establish a uniform federal excise tax for cigarettes across the country of $6.85 per carton. The stated purpose of this tax increase is to improve the health of Canadians by discouraging tobacco consumption.
The government proposes that the federal excise taxes on cigarettes will increase $2 a carton in Quebec, $1.60 a carton in Ontario and $1.50 a carton in the rest of Canada. This would bring the total federal excise burden on cigarettes to $12.35 a carton.
Never to leave itself out whenever there is the remotest possibility of collecting further taxes, federal revenues will increase by approximately $240 million a year through the tax hike. Just a few minutes ago my colleague whipped out his calculator and averaged this out to a $657,000 per day increase in revenue for the government.
What about reducing smoking? This apparently is the reason for the tax hikes. Like everyone else, I want Canadians to live a healthier lifestyle. I want this especially for our youth who really do not know what they are doing when they get involved with smoking.
Reducing teenage smoking is a worthwhile goal. I am pleased when I see a government ad on television once in awhile encouraging young people not to smoke. Some of those ads look pretty effective to me but I am not sure they have had much influence on the decisions of young people to smoke or not to smoke.
I believe that the increase in revenues should be more dedicated to the decreasing of smoking in a way that would be more effective than simply raising the taxes. The past decade has proven that high levels of excise tax on cigarettes do not reduce consumption. What it does do is create an underground economy.
A better role for the government would be to provide information for consumers to ensure that citizens have an informed choice and to offer generous assistance to those struggling to break this cruel but legal addiction. We hope the government spreads the word about the life threatening aspects of tobacco use and does whatever a government institution can do to encourage, persuade and limit the use of tobacco products that are so harmful, not only to youth but to everyone, even to those who do not use tobacco products who are perhaps allergic to tobacco smoke, as I am, and find it not only offensive but hurtful physically.
Time and again we have seen the increases in the prices of cigarettes not working for the purpose of reducing the number of Canadians who smoke. It is interesting that while the bill is heralded by the government as trying to decrease tobacco consumption by issuing a tax grab on smokers, it does not attempt to influence alcohol consumption through tax policy.
The problem with this aspect of the bill is that the government, by increasing these tax levels, is simply increasing its revenues. This cold-hearted government will do anything to increase its revenues. Increasing taxes on alcohol and cigarettes is probably the last great vista of politically correct tax increases still at its disposal.
We know the finance minister has never encountered a tax he could not raise. Canadians know that excise taxes are not dedicated to specific spending. They are not dedicated taxes, to use the jargon.
For example, the government does not use gasoline taxes to fix our highways. Aircraft fuel taxes are no longer applied to navigation services as they were intended when first applied. Pilots now pay navigation fees to Nav Canada, but with no reduction in the Nav fuel taxes that they pay when they put the fuel in their aircraft. Neither are tax revenues on cigarettes and alcohol spent on health care, at least in the amounts that would be effective in controlling, reducing and helping those who do smoke.
The funds raised by taxes are sent to the general revenue fund and used for bigger and bigger government paid for with higher and higher taxes. These cigarette taxes are just the latest tax increase. If anyone wants to bet that this is the last tax increase, I might just take that bet even though I am not much of a gambling man.
These tax dollars buy a fountain in the Prime Minister's riding, or are given to Wal-Mart to set up a store in Ontario, or buy jets from Bombardier for the Prime Minister and his cabinet. Just last week we learned that billions of dollars are spent on foundations without the approval of the House.
There is no way to scrutinize how this money is spent. Yet while federal excise revenues have increased, transfers to the provinces for health care have decreased. They have been reduced.
The Liberal government is not telling us the plans it has for using the new revenues the bill will raise. The Liberals are using this legislation, supported by the stakeholders in the industry affected by the bill, to raise more money but for still undetermined purposes. It is no wonder the Canadian dollar is sinking out of sight with such poor management. It is no wonder even while we talk about the wonderful standard of living in Canada we are watching a standard of living that has been declining.
With Bill C-47 the government is hiking taxes under the guise of tax fairness. It leaves no stone unturned in the search for more money. Everything, even increasing fairness in the way we are taxed, can be and is turned into another way to gouge the taxpayer.
Once again I acknowledge that we will support this legislation, but only because it does some small bit to afford some equality in the markets of the affected businesses.
Jocelyne Girard-Bujold: Madam Speaker, I was not sure I would have the opportunity to be heard this afternoon. So, I am glad to be able to speak today on Bill C-47. First, I would like to congratulate my hon. colleague from Saint-Hyacinthe--Bagot for the presentation he made earlier as he educated us and told the people watching this debate on television that the way the government dealt with Bill C-47 was a disgrace.
The Bloc Quebecois supported this bill until our colleague from Saint-Hyacinthe--Bagot realized, in parliamentary committee, that the die had already been cast. Instead of protecting the interests of the public, of organizations simply asking for their fair share—which is what the government was elected for—it protected the big shots who are very close to the government.
The bill did not refer to the excise tax on beer. As we all know, this bill dealing with the taxation of spirits, wine and tobacco and the treatment of ships' stores was also supposed to deal with the taxation of beer. Unfortunately, microbreweries, which are doing well and taking up 4% to 5% of the market, will not be considered as breweries. The Canadian Council of Regional Breweries finds this appalling. Microbreweries are important because they mainly operate in regions and are significantly contributing to local economies.
In my region, in L'Anse-Saint-Jean, which is located in the riding of my colleague from Chicoutimi—Le Fjord to be more precise, there is a microbrewery that was producing, a few years ago, seven different brands. Nowadays, it only brews three different brands: Illégale, Folie Douce and Royale.
Why have Brasseurs de l'Anse Inc., in the Saguenay region, had to limit its share of the market in the last few years? Because it was being treated unfairly by the government. I find it quite pathetic that the hon. member for Chicoutimi--Le Fjord, who claims to be concerned about regional development, would choose to support the member for London West.
I find what happened this week at the finance committee most inappropriate. Madam Speaker, I am also a woman. We both have a position in our society. These days, many women have careers and we see more and more women at executive levels. When the member for Saint-Hyacinthe--Bagot, my leader and the member for Roberval brought up that practice at the finance committee, the Prime Minister of Canada thought they had acted condescendingly towards women. I interpreted what he said as being contemptuous towards women in general and myself. He understood quite differently what the members of my party were saying. What he understood was not what my colleagues meant. I am a woman and if my colleagues had meant that women should not occupy important positions, I would have been the first to call them to order.
My colleagues said that the member for London West who is a woman and chair of the Standing Committee on Finance--
[Intervention]
Some hon. members: Oh, oh.
Jocelyne Girard-Bujold: Madam Speaker, could you tell the Liberal member of who knows what riding that whenever she has something to say, she should rise and then put her questions?
When the member acted in that manner, she was chair of the Standing Committee on Finance.
If I were a member of a committee and had some interests, or if someone in my family had interests, I would not stay. The hon. member could have let another member of parliament sit in her place. There are so many Liberal members on that committee that she could have given up her seat and say “I will not deal with the microbreweries issue, because my spouse has a direct interest in it”. She did not do it. She continued to sit on that committee.
The hon. member for Saint-Hyacinthe—Bagot proposed amendments dealing primarily with microbreweries. The Liberal member used her authority as chair of the committee to reject the amendments of the Bloc Quebecois.
Since the last general election, since Motion No. 2, we have a new way of operating in the House. When amendments are presented to a committee, they cannot be presented again in the House at report or third reading stage.
The Liberal member knew exactly what she was doing. I find this deplorable. I really like the hon. member for London West. In the past, we have had the opportunity to discuss a number of issues. I thought she was very professional in making decisions. But now, I find it deplorable that the Liberal government would have reacted in such a fashion.
When the government reacts in such a way, when it deals like this with an issue that should be dealt in an honest and transparent fashion, and when things such as what happened occur, it means that something is going on.
The Acting Speaker (Ms. Bakopanos): I am sorry to interrupt the hon. member. She will have 13 minutes when the bill is again debated in the House.
It being 2.30 p.m., the House stands adjourned until Monday next at 11 a.m. pursuant to Standing Order 24(1).
(The House adjourned at 2.30 p.m.)