Bill C-26 (Historical)

An Act to amend the Criminal Code (criminal interest rate)

This enactment amends the Criminal Code by exempting persons from the application of section 347 of that Act in respect of agreements for small, short-term loans. The exemption applies to persons who are licensed or otherwise authorized to enter into such agreements by designated provinces that have legislative measures that protect recipients of payday loans and that specify a limit on the total cost of those loans.

Business of the House

[Rob Nicholson, Conservative, Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, today we will continue with the NDP opposition motion.

Tomorrow we should conclude debate on third reading of Bill C-9, an act to amend the Criminal Code (conditional sentence of imprisonment).

Next week we will begin the report stage of Bill C-16, fixed dates for elections, followed by Bill C-26, payday loans, Bill C-6, an act to amend the Aeronautics Act and to make consequential amendments to other acts, Bill C-17, an act to amend the Judges Act and certain other acts in relation to courts and then Bill C-27, dangerous offenders.

I will continue to consult with the House leaders of other political parties with respect to Bill C-31, the voter integrity bill, and we may be able to proceed with that next week as well.

Criminal Code

[Stephen Owen, Liberal, Vancouver Quadra, BC]

Mr. Speaker, I will begin today by talking a bit about the theory of criminal justice and how we get tough on crime, which is the slogan often used by those across the way.

We cannot get tough on crime without being smart on crime and that means not just descending into slogans, such as “getting tough on crime”, “war on crime” and “three strikes you're out”. We know where that rhetoric comes from and we know that it is based on false analysis. It is based on ideology and sloganism, not on criminological research, social research or demographics which all gives serious concern to knee-jerk, superficial stoking of the fears in society about a situation that may not exist. That is done for purposes that are ideological and polemical and they carry a real danger of being self-fulfilling.

I would like to take a few minutes to speak about how being tough on crime means being smart on crime first.

Let us just take the 12 bills dealing with criminal justice that are before this House and the one that is before the other place. The official opposition has offered this week to cooperate and fast track eight out of the eleven of those bills, and I will speak to the other two in a moment, but that is in no way doing anything but making this place work with sensible dialogue and debate over how to, without holding up any of these bills, ensure they are not more dangerous than what we are to believe they are to protect us against.

We have offered to fast track Bill C-9, the conditional sentencing bill. It has had serious debate and an appropriate amendment was moved by opposition parties so it can now go ahead. We will give it all the speed it needs.

We will fast track Bill C-18, the DNA identification act; Bill C-19, street racing; Bill C-23, criminal procedure improvements; and Bill C-26, payday loans. I would pause to say that five out of the six bills that I have just mentioned were actually initiated under the previous Liberal government. They will go forward with our support and with sensible amendments where necessary. We will fast track two other bills.

We opposed the judicial salaries bill because we opposed the suggestion by the government that it disregard the Judicial Compensation and Benefits Commission which recommended appropriate increases for judges' salaries over the last four year period. While we opposed that, we allowed it to pass on division so there would be no slowing up of that process.

The 13th bill is Bill S-3, the military sex offender act, which is now before the other place. We will be supporting that bill and are willing to fast track it in every way we can.

In the context of discussing the dangerous offender legislation, it is important to underline the cooperation that is going on in the House to identify what is important, to carry on work that was done by the previous government and to get some of these things moved ahead.

However, Bill C-27 is of a different order. The dangerous offender legislation before us has some major flaws that I will speak about but I would first say that we need a reality check. Let us take a reality check first on the criminal conviction statistics in Canada which have been steadily coming down over the last 10 to 15 years. That is what the research tells us. The demographics themselves in society are leading through analysis to that decline in the crime rate. While we may raise the fears of the public to justify simplistic solutions through sloganeering and superficial claims to put fear in the hearts of Canadians, the crime rate comes down.

Let us take another reality check on the situation in the U.S. where these slogans come from and much of this legislation seems to be patterned after. The United States has the highest crime rates and incarceration rates. It also has the most dangerous communities and the most expensive criminal justice system.

If we are to follow any model in the world when we amend our criminal justice statutes, we certainly do not want to follow the so-called war on crime in the United States.

Let me pause to mention that the state of California spends more on criminal justice and corrections than it spends on education. That should be very edifying to all of us.

Let me give another example about the folly of pretending that just by putting people in jail on very restrictive terms without any adjustment for the context of a particular case can be more dangerous for society. Most convicted people, dangerous or not, will get out. We have the Bernardos and some of the most horrid criminals in our country's history who will be behind bars, blessedly, forever, but most criminals will get out.

Let us think of those people who go into a prison situation, which members opposite would like to see everyone go into. It is a bit of an irony to consider that prison life, if that is what we can call it, prison for life, is the place in society which should be the most protected but is in fact the place where one is most likely to be assaulted, raped, infected and injected, and these people will come out.

Therefore, we need to take particular care for the correctional services, the proper services within them and who we put behind bars and for how long.

Let me speak about the fact that 25% of the prison population in this country is made up of aboriginal people. This is a stunning statistic of despair. Can this be the result of a fair criminal justice system or is this a result of despair in aboriginal communities? Is it part of the despair of our prevention system and our criminal justice system of preventative crime? Is it a matter of racism in society? What is happening?

These are the underpinning questions that we must be asking ourselves in the House as we respond to the reality of the criminal justice system. This is 1% of the population and 25% of the prison population.

Let us ensure that when people do come out of prison, if they are going to be spending time there, that they have been rehabilitated and they are safe to society because the vast majority will come out.

We will not ensure that the context of the situation is properly taken into account in peculiar circumstances unless police officers, prosecutors, judges, correctional officers and parole officers have the discretion to identify where the dangers are and where someone may have a better response to a criminal justice sanction than simply putting someone in jail for an indefinite period.

Turning to Bill C-27, the dangerous offender legislation, the member opposite has mentioned that there is dangerous offender legislation on the books now and it is operating. It operates as a companion with long term offender legislation which can kick in. Prosecutors have the discretion to bring forward at sentencing applications before a judge for a long term offender or a dangerous offender designation. That works. It has been covered by the Supreme Court of Canada in the Lyons and Johnson cases in 1997 and 2002. It has been found to be constitutionally appropriate. I would suggest that it is working because it allows for all the proper discretions to be exercised.

The problem with what is being suggested in Bill C-27, and it has been referred to by numerous members of the House, is the reverse onus provision at sentencing after a third conviction of a certain type of very serious crime.

We have heard some people say that this offends the presumption of innocence, which is an historical criminal law principle in our legal system. However, the trouble is not with the presumption of innocence, which is subsection 11(d) of the charter. The question is about the reverse onus of the burden. This is not a conviction matter. It is not a presumption of innocence because the person has already been convicted for the third time.

What we are talking about is whether fundamental justice, in reversing the onus on such an extraordinary punishment, can meet the tests under section 7 of the charter for fundamental justice. There is strong authority that this simply cannot be done. This does not meet the tests of fundamental justice. It involves, for instance, the convicted person proving a negative into the future. Yes, it is on the balance of probabilities and, yes, as the member opposite said, there is judicial discretion to determine whether that onus is met or not, but there is still a reverse onus and, in many cases, it is an impossible burden to attempt to prove a negative into the future.

It is also a problem because it offends section 7 as being against the principles of fundamental justice and it is a problem under section 1 as to whether this is a justifiable limit on the rights under the charter. Is it a substantive need? Is it a rational connection? Is there minimal impairment? I would say that under all those cases this reverse onus does not meet the test. This is highly constitutionally suspect. Why, when we have a provision that is working well, would we want to throw ourselves into very likely years of constitutional charter litigation when we have charter compliant provisions now for dangerous and long term offenders?

We also have a problem that this will not be enforceable. This is ultra vires of the federal government to tell the provincial governments, which are responsible for the administration of criminal justice, who they should prosecute and what sentences they should ask for. That simply cannot be supported in our constitutional division of powers and, therefore, it is inappropriate for the government to put this forward.

There are also dangerous unintended consequences that could come to the fore here. We have long delays in our criminal justice system today. A report in the paper last week showed that in the province of Ontario 100,000 charges have gone beyond the nine months before they actually go to trial. This is bouncing very perilously close up against the Supreme Court of Canada Askov decision where all members will remember with regret that 30,000 criminal cases were dismissed because it took too long for people to get to trial.

If people are facing this so-called simplistic, superficial three strikes and they are out law, which has been so disastrously unsuccessful and dangerous in the United States, they will insist on going to trial more often. There will be less guilty pleas which will cause further delays in the courts and perhaps more cases will be thrown out because of charter violations.

The one side of it is that there will be more trials, longer delays and more costs to the prison system. I have not even begun to talk about the hundreds of millions of dollars in capital costs that will be required to build the prisons that will hold these long term offenders.

Costs will be going up, delays will be longer and cases will be thrown out for charter violations because of delay. The other dynamic that may happen and where prosecutors, with long dockets and not wanting to have further delays in trials, may charge people with lesser offences than would otherwise justify a conviction for a more serious case that may give them a longer prison term, or the convicted person may plea bargain to a lesser offence.

Both of those dynamics are more likely to put dangerous people on the streets and put in danger the men and women the member opposite was just speaking about. We have to be very careful when we tinker with these laws, especially if we are doing it superficially and against the evidence of criminologists and social scientists as to what is effective and what is not.

Let us turn for a moment to what being tough on crime by being smart on crime really means. It means a national crime prevention strategy, such as the one the previous government put into place across this country over a period of 13 years, funded in a very targeted way, to help kids have things to do after school. If I may indulge myself in a short phrase, it is about shooting hoops, not drugs. There are sports programs across this country in the evening and even far into the night where kids who otherwise would have been getting in trouble are involved in healthy activity.

We have to watch for issues of poverty and cultural exclusion.

We have to look at the issue of legal aid, which is in underfunded disrepair across this country, thus involving people in perhaps building up criminal records when they should have been having trials and pleading not guilty. They are pleading guilty because they cannot defend themselves in the courts without assistance.

We have to look at issues of homelessness. We have to look at issues of mental illness. The Kirby-Keon Senate report was an extraordinary statement of sound thinking about how to deal with those with mental illnesses, who unfortunately fall into the ranks of the homeless as well as the ranks of the criminal justice system, which is the worst place for them to be. We have to rethink this and meet our social contract around the concept of deinstitutionalization, whereby governments emptied the mental hospitals but then did not provide services in the community to support people.

We have to look at drug courts. They are operating in Toronto and Vancouver and in numerous American states. That is one example of where the American criminal justice system has actually been a stunning success at diverting people out of the criminal system if they will go into detox and treatment.

We have to look at issues of harm reduction. Drugs, addiction and substance abuse are great parts of the despair that leads people into the criminal justice system. Harm reduction, of course, involves needle exchanges and safe injection sites, which the government has failed to guarantee would be extended in Vancouver, when it has been an example for literally the world to consider the effectiveness of harm reduction in that situation, to help motivate people into detox.

We need shelters for them. We need transitional housing. We need skills training. We need affordable housing. We need jobs. In fact, the social enterprise initiatives of the last Liberal government, which were ready to go across this country, certainly in my province of British Columbia, were cancelled by the current government in its last budget. Those are the things that can assist people to not fall into crime and into despair, which leads them to become dangerous for other members of society.

What are we going to do instead? We are going to dismantle the gun registry. It is amazing that any thought could be given to that at this stage after the tragedy at Dawson College in Montreal.

We have a Prime Minister who will not go to an international AIDS conference in Toronto. We have a Prime Minister who did not go to a world conference on harm reduction in Vancouver last April.

We are simply looking in the wrong direction. We have to be tough on crime, I agree with all members opposite, but we are going to be tough on crime by being smart on crime and not by being simply superficial and using slogans.

[Sue Barnes, Liberal, London West, ON]

Mr. Speaker, I am pleased to rise today to speak to Bill C-22. I am also very aware that all the justice critics need to be in committee for clause by clause of another justice bill right after this, so I am going to truncate my remarks to help get all the right people in the room who need to be there shortly after question period.

I will say at the outset that our party will support the bill. In doing so, we are following up on work that has gone on over a number of years. The Speech from the Throne of October 5, 2004 committed the government to cracking down on child pornography. Similarly, in the previous Speech from the Throne, the former Liberal government committed to reinstating former Bill C-20, An Act to amend the Criminal Code (protection of children and other vulnerable persons) and the Canada Evidence Act.

The bill was reinstated on February 12, 2004 as Bill C-12. It was awaiting second reading in the Senate at the time of that Parliament's dissolution for a federal election. In June 2004 the then prime minister reiterated support for reintroduction of the package as the first legislative item in the new Parliament. I know that the former minister of justice, the hon. member for Mount Royal, introduced in the former Parliament Bill C-2, An Act to amend the Criminal Code (protection of children and other vulnerable persons) and the Canada Evidence Act. It received third reading on June 9, 2005, royal assent on July 20, 2005, and came into force in its entirety less than a year ago, on January 2, 2006. Bill C-2, then, is built on reforms previously proposed in the former Bill C-12 and proposed reforms in five key areas.

I might reiterate, too, that former Bill C-12, by a procedural motion, a hoist motion, from the then opposition Conservative Party, was prevented from going forward a couple of years earlier.

Be that as it may, when I hear the Minister of Justice incorrectly saying that nothing was done, I have to put on the record that we did strengthen prohibitions against child pornography.

We broadened the definition of child pornography to include audio formats as well as written material “that has, as its predominant characteristic, the description of prohibited sexual activity” with children “where that description is provided for a sexual purpose“. We prohibited advertising child pornography, increasing the maximum sentences and making a number of offences have more bite.

We wanted to protect young persons against sexual exploitation. One of the things that I like in Bill C-22 is that the government has not disposed of that section that was so important, the section that talked about the exploitation of children. It had prohibited sexual activity with young persons between 14 and 18. Under Bill C-2, a court would be directed to “infer that a relationship is exploitative of the young person based on its nature and circumstances, including the age of the young person, any difference of age, the evolution of the relationship, and the degree of control or influence exercised over the young person”.

Consistent with the existing criminal law treatment of sexual assault, that bill focused on the offending conduct of the accused rather than just on the young person's consent to that conduct. That was always the concern, that it was not just an age number, because the age of 14 has been in the Criminal Code and utilized since the late 1800s. It was the “exploitative” nature, and I am pleased that the bill keeps this, because that helps in our being able to come forward with our consent today.

We did increase the penalties for offences against children.

We facilitated testimony not only for child victims and witnesses under 18 years but for other vulnerable victims and witnesses. This is procedural, to help stop re-victimization in the court process.

We created a new voyeurism offence. Today we have those cameras that take pictures; that is why we needed this.

In 2002 we also created the offence of Internet luring under section 172.1 of the Criminal Code. That prohibited the use of a computer system, including the Internet, to communicate with a young person for the purpose of committing a sexual assault against that person. It can and is being successfully charged, irrespective of whether a sexual assault actually took place. The fact of the offending conduct of trying to lure a child via a computer system is what we were getting at and it is there.

Also, just a few weeks back, a private member's bill on increasing sentences passed in the House.

Today's Bill C-22 is an improvement over former private members' bills, no matter how good the intention was. The fact is that now this bill has the five year close in age exception and that will go a long way, I think, in helping us to accept this bill and give our consent to it.

In fact, in our Liberal justice plan announced last week, this was one of the bills that we said would be put forward and given consent by our party, along with the other bills of conditional sentencing and imprisonment, as amended in committee, such as: Bill C-9; Bill C-18, an act to amend certain Acts in relation to DNA identification; Bill C-19, an act to amend the Criminal Code (street racing) and to make a consequential amendment to the Corrections and Conditional Release Act; Bill C-23, an act to amend the Criminal Code (criminal procedure, language of the accused, sentencing and other amendments); and Bill C-26, an act to amend the Criminal Code (criminal interest rate), which was debated in the House last week under the topic of payday loans.

We on this side will add Bill C-22 to that list of bills. There are about 11 government justice bills. This one makes six that the Liberals are prepared to move forward in the Liberal justice plan, although we do not think that these bills are universally perfect. But we could find flaws with all pieces of legislation in the House. There are sections in this bill to do with unconstitutional areas of the Criminal Code, which we could have fixed. The justice minister has chosen not to do that, but at this stage I think the protection of children should be our utmost priority.

Listening in the chamber today was one of the good police officers who has to work in this area. He was kind enough to give some Liberal members a briefing. Unfortunately, his colleague from the federal police services was not allowed to do that, for reasons unknown.

On this side of the House, we as the official opposition are prepared to support this bill. I am prepared now to move on and give my time so that critics from the other parties can all be present in the justice committee for voting measures later this afternoon on another piece of legislation. There is unequivocal support here for Bill C-22.

Business of the House

[Ralph Goodale, Liberal, Wascana, SK]

Mr. Speaker, in light of what the government House leader said just a few moments ago, I wonder if you could see if there is unanimous consent in the House at this moment for the following motion: That Bill C-9 be deemed to have been concurred in at report stage, read a third time and passed; that Bills C-18, C-19 and C-23 be deemed to have been reported from committee, without amendments, concurred in at the report stage, read a third time and passed; and that Bills,C-22 and C-26 be deemed to have been read a second time, referred to and reported from committee without amendments, concurred in at report stage, read a third time and passed.

Criminal Code

[Brian Murphy, Liberal, Moncton—Riverview—Dieppe, NB]

Mr. Speaker, I am pleased to rise in the House today to speak to Bill C-26, an act to amend the Criminal Code with regard to criminal interest rates.

This bill is in fact designed to regulate the payday lending industry. This will be done by limiting the interest rates lenders can charge Canadians.

I am quite pleased as well to see that the minority government is taking advantage of the hard work done by previous Liberal ministers of industry and justice. In introducing this bill, it surely gives a sign that what we were doing before was just fine.

It is flattering to see Canada's new government actually putting forward many bills that were in the past proposed by Liberals. Despite what my colleagues on the other side of the House may be saying, they are acting as if what was done before was going in the right direction.

It was the previous Liberal government that worked with our provincial and territorial colleagues to build the consensus necessary for the legislation that we are discussing today. Currently, section 347 of the Criminal Code of Canada makes it an offence to enter into an agreement or arrangement to receive interest at a criminal rate or to receive a payment that is at a criminal rate.

It is interesting to note that section 347 was introduced initially to deal with the practice of loansharking and its links to organized crime. It was not always the written signed agreement under the shiny lights on the main streets of our cities that these arrangements were entered into, but often in the back alleys and through very informal discussions.

Although section 347 has been interpreted as applying to most lending arrangements in Canada, including payday lending, it was not intended to be consumer protection legislation or a consumer protection tool for economic price regulation when it was first introduced. It would seem that section 347 was attempting to capture criminals who looked like criminals and not criminals who look like storefront entries as many of the payday lending institutions of today's currency do.

In fairness, the Canadian Payday Loan Association itself, unlike the characterization of the member for Winnipeg Centre that would have us believe is made up totally of criminals, is in fact proposing this legislation which will be of benefit to consumers and the people we represent.

However, let us look at the scourge of the bad payday lending experience and what it has visited upon our citizens. In British Columbia a judge ruled in a class action that a payday loan company charged criminal interest rates when it included its late fees and processing fees as interest. That is what the court ruled. The ruling is expected to influence the outcome of many decisions. It is an instance of where the judiciary has stepped in to characterize as interest what may be seen as fees and thereby impinging some payday loan arrangements.

Last year in Ottawa, a small claims court judge ruled that two payday loan companies suing clients for unpaid debts, this is ironic, were themselves avoiding the law and breaking the law. The facts as they came out were that a loan of $280 rose with interest and penalties to $551 per month. That is an annualized interest rate of more than 2,000% and these people had the temerity to bring it to court to get their money.

The judge could not rule that it was in violation of the law because that was not the dispute in front of the court, but it shows the boldness and frankly, the arrogance of some payday lenders in charging that amount of interest and standing by it as if it were not more than 60% which is clearly set out in the Criminal Code.

Bill C-26 would not put an end to payday loans. The industry could easily continue to operate, but it is going to operate with controls. It is important to note that the legislation does not apply to loans over a certain amount, $1,500 and over a certain length, 62 days. This act does not replace the Criminal Code.

I think a principal theme of our discussions today on this bill must address the paucity in the Criminal Code itself to deal with the crime. So anything that is over 62 days that is over 60% ought to be prosecuted.

In studying the bill, we have learned that there are very few prosecutions. It is time for the government to take this information, as if it did not know it before, and tell the administration of justice officials, both federally and provincially, that we have a section called 347 and it should be enforced. If it is true, but we do not know because we have not had a full hearing on section 347, that only a prosecution or two have been made under this section in the last few years, something has to be done about that. The bill will not cure any of the in excess of 60% in loans that are longer and larger in duration than what it attempts to cover. However, it is a start, it is good legislation and we should support it.

It means, however, that the provinces and territories have to get their acts together. I am very hopeful that the new federal government has kept good relations with all the provincial counterparts and has, like we did before, an easy discourse of opinion on how to best influence reasonable rates, like the province of Quebec has administered for some time under its consumer protection legislation.

Several provinces, including New Brunswick, have already announced their intention to regulate payday lending once this bill is passed.

I know that the new Liberal government in New Brunswick will address that situation as soon as this is done.

I know T.J. Burke, the new attorney general for the province of New Brunswick. He is the first aboriginal attorney general in Canada, and he is an excellent law official. Once this legislation passes, I know he will be looking to the models across the country, specifically the model in Quebec, which seems to give to our citizens the best consumer protection.

Payday lending is a growing industry in Canada. Virtually non-existent in 1994, the industry is believed to have grown to more than 1,300 outlets in just 10 years. That is why perhaps this law is just coming to us now. We probably all saw the industry grow, but empirically did not know that 1,300 outlets existed across Canada. Nor would we know, if we are not users of the services, what horror they are inflicting on our citizens.

The number of payday loan outlets now outrank the number of offices of the Royal Bank of Canada. Therefore, it is important to underline that this is not just a Main Street, Stellarton, one-off issue. The bill is dealing with a Canadian issue.

Only 850 or so of these institutions are represented by the Payday Loan Association. They have been very forthcoming in lobbying for a bill to protect consumers. I would suggest to go halfway to also ensure that they have an existence after the passage of the legislation.

One thing we may consider, as the bill travels along the process to committee, whether we will strengthen the legislation and attempt to affect and to curb the impact of usury on our citizens.

I cannot say this strongly enough. While VISA cards regularly get 28%, the province of Quebec has chosen 35% as a ceiling interest rate. I cannot say strongly enough how we, as parliamentarians, in the moral persuasive stance that we have with provinces and territories, might suggest that the Quebec model is a good model for the citizens who we share as electors.

The significant growth of this sector is actually hiding the dire situation facing many Canadians.

A few years ago, holding a full time job was enough to support one's family. Unfortunately, that is not necessarily the case anymore. Times have changed. Many Canadians work full time, and some even work more than one job, but that is still not enough to support their families financially. There lies the real tragedy.

We are doing just a bit to help the working poor in this situation.

As a former member of an Open Hands Food Bank organization in Moncton, New Brunswick, food banks are no longer visited by the very poor and destitute only. They are often visited by the working poor, people who work as a couple with minimum wage jobs, people who need to have two minimum wage jobs, people who have children or people who have a letdown in hours at the video store, one of their minimum wage jobs. This means they are forced to go to the food bank or, as I say, le vrai drame, to the Money Mart, to get a loan at a high interest rate to pay the rent, to have groceries and to ensure their children can go to school.

Does it make sense to borrow money from someone who is going to charge an outrageous interest rate? Of course not. The fact is, however, an increasing number of Canadians have no choice. They have generally been turned down for loans at the chartered banks and other financial institutions. Although many of them have full time jobs and a steady source of revenue, many have no choice but to go for the short term, high interest rate loans to survive between pay cheques.

The real tragedy is that in 2006 working hard and having a job might not be enough to support one's family. I find it troubling that more and more Canadians cannot meet their everyday living costs. In recent years many social groups have pointed out that the number of citizens living under the poverty line is growing and that having a full time job does not necessarily protect one from poverty in today's world. This is very unfortunate, something that is compounded by the fact that if a person goes in to borrow $280, that somehow turns into a $551 per month payment. We are doing something, but very little to help that problem.

While we say the bill is good, what about the social safety net that the new government is putting out for the people who are left to have 60% interest loans, from the legal Money Marts, for 62 days for amounts under $1,500?

Let us not over blow what step this small bill is toward the journey of helping us help the working poor. If we combine the statistics of the working poor, the increased usage of our social service agencies, with the major cuts that the Conservative government announced three weeks ago, it is now clear the new government does not care about those most in need, the poorest citizens and the minorities throughout our country.

Let us face it, the Conservatives are leaving the most vulnerable behind. A true national child care program, aboriginal health initiatives, literacy funding, homelessness, affordable housing initiatives, these were all mechanisms to help low income families, they very people who are most victimized by the ravages of the Payday Loan Association members.

All the measures I suggested have been cut and cramped in the recent Conservative announcements, such as national child care, teaching children how to succeed in life, literacy, teaching children and adults that they can read and they can get better jobs, tackling the homeless initiative, which was once made a very national and prominent program under the former member for Moncton—Riverview—Dieppe, the hon. Claudette Bradshaw, are all gone as priorities in the government.

Although the government will do some lip service to the Payday Loan Association, mainly because it is a good lobby and it might get some credit for helping the working poor, it is really saying it will not go that far and reinstitute programs, which were of national importance for eradicating the spectre of cyclical use of social services and organizations, such as payday loan institutions.

The same low income family that works hard to survive but cannot afford to put money aside for rainy days is forced to live from paycheque to paycheque. Exactly the same people are being denied loans from banks and they end up at the payday loan services, probably just before or after they go to the food banks. Before having to do this, they probably had time in their day to get some literacy training, or they may have been able to access some child care initiatives. However, they are not going to be any better off with the Conservative government as the years go by.

The real point is that this is a good step in a long road. The Conservative government must understand it entails much more than just initializing a law that was started by a former government, which is a needle in a haystack with respect to the battle against poverty, especially among the working poor.

This bill will ensure that those who turn to payday lenders do not fall victim to questionable practices, criminal interest rates and unfair collection techniques. More importantly, it will help make sure that they are not sucked into the vicious circle of debt and outstanding loans.

Bill C-26 is a positive, necessary step in the right direction and it battles loansharking, but it does not do enough at this point. The House should encourage all provinces and territories to look at the model is the model of Quebec. I hope this will happen at the committee stage.

As we move along the legislative process, we find that many of our models for a just and fair society have come from the province of Quebec. Programs like the national child care program and the legislation for consumer protection are best modelled in Quebec. In our discussion we should encourage the provinces to follow those examples.

The finance minister for the province of Manitoba is in the process of deciding how to deal with the brief put forward by the Payday Loan Association. The president of the Payday Loan Association says that Manitoba's proposed law is in line with the code of best business practices adhered to by its members. It operates 800 of the 1,350 payday loan offices in the country.

What is not known is the fee cap the province would set. The finance minister, Mr. Selinger, is proposing to make fees and rates on payday loans subject to public review by the local public utilities board. If the Quebec model is not the model provinces choose to follow, by having consumer protection legislation govern the scheme, then the model of having the public utilities board review rates of interest that can be charged by payday loan associations, which survive this document, would be very preferable.

We seem, as the federal sphere, to have gone away from consulting and advising the provinces with respect to best practices, and not necessarily mandated practices. By this I mean giving them a cheque and telling them they must do this or they must do that. Rather do it in a true constitutional sense, as partners that share the same citizens, the people who vote for them vote for us, and suggest they look at the models, which include the Quebec consumer protection legislation and the suggestion of the very wise finance minister in Manitoba of public utility board regulating interest rates.

The public utility boards across the country are made up, by and large, of non-partisan people interested in consumer protection in the areas of energy and transportation. In this case, Manitoba would invade the field by suggesting interest rates on short term loans would be properly in the public domain of the public utilities board. In many provinces public insurance is dealt with at a provincial level and the rates of insurance are decided by a public utilities board.

Again, this is a very good step. It follows on Liberal legislation, which was being thought of before the government fell. It is enough at this point to say we support it. However, at committee perhaps suggestions as to the how, not the why, the bill will play out across the country can be discussed along with our desire as parliamentarians to ensure the bill is implemented in as even a fashion across the country as possible.

In closing, I thank the citizens ofMoncton—Riverview—Dieppe for giving me their input on this most egregious example of lending at usurious rates. I assure them, in supporting the bill, that it is not a cure, not the be-all and end-all. It is a tiny step on the long road to helping the working poor in our country.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, since for all intents and purposes we are discussing micro-credit, I would like to point out that the member for Winnipeg Centre and the member for Skeena—Bulkley Valley made special mention of the social responsibilities that banks should have. I remember introducing a bill, on another occasion, that would have allowed banks to play a social role by helping the most disadvantaged and the poorest who have to pay administrative fees. Often bank services are not accessible to these individuals.

I would just like to make an important point. The member for Edmonton—Sherwood Park mentioned that the member for Winnipeg Centre was too kind to the poor and that we have to follow the lead of the government in terms of Bill C-26. I would like to point out that, this year, Mr. Muhammad Yunus received the Nobel Peace Price. He is an economist who established a micro-credit system, with 1,200 micro-credit offices, which today has created jobs for 12,000 individuals. These are small repayable loans made at rates that are probably much lower than 60%.It gives credence to the statement that, and I quote, “Lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty”.

If people need payday loans and, if for all intents and purposes, micro-credit were available for relatively short periods, would it not be important enough to warrant establishing this system within the banks? They could be asked to play a social role and to loan small amounts. We know quite well that, more and more, banks—all banks—make profits in the order of hundreds of millions of dollars, profits often in excess of one billion per year.

Ordinary banks have a social responsibility. I ask the member: would it not be better to ensure that banks fulfill their social responsibilities rather than protecting a loan system which, for all intents and purposes, is usurious?

[Jacques Gourde, Conservative, Parliamentary Secretary to the Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board]

Mr. Speaker, it is my pleasure to rise today to speak in support of a significant piece of legislation, Bill C-26, An Act to amend the Criminal Code (criminal interest rate), introduced on October 6 by my colleague, the Minister of Justice.

This bill amends the Criminal Code to allow for the regulation of the payday lending industry by the provinces and territories. This is a major change which is well received. For years, the payday lending industry was able to operate unnoticed in Canada.

This bill will subject this prosperous sector to regulation and offer greater protection to millions of Canadians and their families who have come to depend on this kind of service. According to the leading industry lobby, namely the Canadian Payday Loan Association, this sector services nearly two million Canadians a year. This is a pretty large number, hence the importance of ensuring that Canadians are well protected against harmful practices in that industry.

The passing of Bill C-26 would first amend the Criminal Code by adding a new provision, namely subsection 347.1, which would exempt payday lenders from the provisions on criminal interest rates where provincial and territorial legislative measures protect consumers in this regard. It would then add a definition of “payday loan”. Finally it would require the provinces to set a limit on the total cost of this type of loan in their legislative measures.

Before examining the content of these amendments, I shall provide a few clarifications on two points. First some background on the payday loan industry in Canada, including its effects on communities across the country, and, second, its debatable practices, which motivated us to take action and propose the amendments before us today.

When they know more about this industry, I am convinced that all the members will agree that the measures put forward in Bill C-26 are pragmatic, balanced and necessary.

The payday loan industry is relatively new in Canada. These convenient establishments with catchy names began to appear here about 1994. The industry began in the West, but today it has spread throughout Canada. In fact there are about 1,350 of these establishments in all Canadian provinces and cities, except in Quebec, and they continue to increase in number. Some 2 million Canadians use these services, borrowing close to $1.7 billion a year. This is an astounding amount when we know that all this activity takes place in an market that is basically unregulated.

These figures show that the payday loan industry meets a real demand by Canadians. According to some, this industry has no place in Canada. On the other hand, it obviously plays an important role in the lives of many Canadians. There are several reasons to explain why our fellow citizens turn to the services of a payday lender. Convenience is one of them, since many of these businesses stay open late and on weekends. Also, some people think that the popularity of this sector may be attributed to the fact that the country’s large financial institutions have closed their smaller branches, leaving a void among services providing quick and easy withdrawal of funds in many communities. There is also the fact that this service is relatively anonymous and emergencies can occur, with immediate financial consequences.

In any case, this industry seems to have its place in our communities. So it is important that we provide adequate protection from certain abusive commercial practices to the Canadians who use payday loan services, especially the most vulnerable people in our society.

The government takes its responsibility for improving the lives of Canadians and their families very seriously and is taking a number of important measures to do just that. Whether it be by strengthening the Criminal Code to make our streets and communities safer or by reducing taxes for our fellow citizens, we are committed to taking effective action such as what we are proposing in Bill C-26.

We will continue to do this to ensure that Canadians have the best possible quality of life.

The measures proposed in Bill C-26 are a careful and effective way of improving consumer protection and meeting the need that has been expressed by various people, including the provinces and territories, for effective regulation of this industry. There are three good reasons for doing this.

Payday loans are very expensive. In some cases, the annual cost of a loan from a payday lender can be very high, because of the interest, which is charged at a rate that is sometimes several thousand or more. It also seems that the contract clauses are not clearly disclosed by these lenders.

Aggressive collection methods also create problems, as does the speed with which the amount of these debts can grow out of control when they are renewed. In some cases, payday lenders even penalize a borrower who pays the loan before the due date, by charging fees.

For all these reasons, it should be very clear to all members that there is strong justification for taking action. The changes proposed in Bill C-26 will ensure that the practices of this industry are effectively regulated.

When we looked for the most appropriate way of dealing with this pressing public policy issue, we also worked very closely with our colleagues in the provinces and territories. We gradually realized that section 347 of the Criminal Code was going to be the linchpin of the new rules.

Under section 347, everyone who enters into an agreement or arrangement to receive interest at an annual rate that exceeds 60%, which is a criminal rate of interest, is guilty of an offence.

People who are convicted of that offence are liable to imprisonment for up to five years.

When section 347 of the Criminal Code was first enacted, its purpose was not to protect consumers. Rather, its aim was to give the police another weapon for fighting organized crime, and more specifically loan-sharking. Whatever the intent of Parliament was at that time, this section applies to loan agreements entered into in Canada, including payday loans.

I would note, however, that the government does not believe that section 347 of the Criminal Code is the most appropriate and effective instrument for protecting consumers from the unethical and unscrupulous practices that have been observed in some segments of the payday loan industry.

We are not the only ones who think that way. Many administrations and several groups in civil society have told us that section 347 is not suited to consumer protection. What is more, these same administrations have told us that the application of section 347 to payday loans presented an obstacle to the adoption of effective provincial regulations. As a consequence, the proposed amendments respond to the needs of the provinces and territories, who are the best placed to provide the required protection to consumers by exempting cases where provinces choose to intervene from the application of section 347.

However, section 347 continues to apply in those cases where the provinces do not intervene. We consider this to be an appropriate solution that enables the provinces and territories that are prepared to regulate the industry to do so.

I would also like to point out that Bill C-26 will not apply to financial institutions that are regulated by the federal government, such as banks. Under the Constitution of Canada, banks fall under federal jurisdiction and their operation is subject to a number of federal laws.

By and large, the proposed amendments would exempt payday lenders from the application of section 347 of the Criminal Code in very specific and well defined cases. That exemption would be provided under a new section, section 347.1 of the Criminal Code.

According to a study, the amount generally loaned in the case of a payday loan is never very high—less than $300—and the duration of the loan is generally short—about 10 days. To be eligible, the borrower must prove that he or she has a bank account and provide a post-dated cheque or pre-authorized debit. The borrower must also provide proof of a source of income.

Bill C-26 describes a payday loan as follows:

An advancement of money in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbroking, a line of credit or a credit card

This definition is important because it clearly describes the kind of agreement behind payday loans. The proposed changes have a very specific purpose. We want to ensure that provinces and territories are able to regulate payday loans in their jurisdictions. We also want to ensure that only payday loan agreements are covered. We are doing this because the public policy issues raised by other kinds of credit are very different. I think that the definition provided in Bill C-26 describes payday loans very well.

Bill C-26 also specifies that only certain types of payday loans will be exempted from the application of section 347 of the Criminal Code. The loan cannot be for more than $1,500 and for any longer than 62 days. These limits reflect the maximum limits on payday loans described earlier.

The bill does not propose any regulations per se, not does it set a national limit on payday loan interest rates. What it does instead, in creating an exemption to the application of section 347, is to meet the needs of the provinces, who want to see the obstacles to the regulation of this industry removed. This is important because it is the provinces and territories that are best placed to regulate the payday loan industry.

The ultimate purpose of the proposed changes is the effective regulation of the industry. The best way to achieve this goal is to give the provinces and territories the flexibility they need to set limits on the cost of loans. Thanks to this approach, the regulations that are adopted will be well suited to the specific situations facing the different provinces and territories.

This bill also provides that section 347 will continue to apply in those provinces and territories that elect not to pass legislation governing the payday loan industry.

If a province or territory has made the decision that payday lenders operating within that province or territory are to be exempt from the application of section 347 of the Criminal Code, it will have to apply to be designated for that purpose by the federal government. In order to be exempted, it will have to show that it has adopted legislative measures that protect anyone who wants to take out a payday loan. What those consumer protection measures are will be left virtually entirely to the discretion of the provinces and territories.

This is a valid approach in that it recognizes the nature of the situation in each jurisdiction, including, specifically, the way that the industry operates there, and also the existing provincial consumer protection legislation adopted under the powers assigned to the provinces by the Constitution in relation to property and civil rights.

Bill C-26 requires, however, that the province provide for limits on the total cost of payday loans in its legislative measures. I believe that this approach reflects three fundamental factors.

First, the provinces and territories are capable of controlling the cost of loans within their jurisdictions. Second, this guarantees that there will be a limit on the cost of borrowing. And third, as we saw earlier, it offers a flexible solution that can be adapted to the characteristics of each province and territory.

The Governor in Council will make the necessary assessment before granting a province or territory the designation applied for. The province will apply to the federal Minister of Justice, stating the legislative measures it has taken to control the cost of loans. Then, on the recommendation of the federal Minister of Industry, the Minister of Justice will ask the Governor in Council to grant the designation applied for. The province will then be given the power to exempt a payday lender, by licence or otherwise, from the application of section 347.

All in all, I believe that Bill C-26 is very important. It offers Canadians greater protection by allowing the provinces and territories to regulate an industry that is in great need of oversight. It sets very clear limits. It defines payday loans and sets a limit of $1,500 for loans that may be made under these rules. It invites the provinces to adopt legislative measures to regulate payday loan agreements, and in particular the total cost of the loans.

Bill C-26 is further proof of the government’s commitment to working with the provinces and territories on matters of common interest. The amendments proposed will have an important and real effect on the Canadians who have come to depend on this service. I hope that all members will join me in ensuring the speedy passage of this bill.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I was happy when I learned I could enter into the debate on Bill C-26, the Criminal Code amendments regarding payday loans. From experience, the payday loan industry is like a scourge on the inner city of Winnipeg, on the riding I represent. I cannot find the words to speak strongly enough about how critical I am of this exploitative criminal industry. I can say the word “criminal” I think without insulting anyone or without pushing things over the line.

This very bill has been put in effect because the government knows full well what has happened, up until the implementation of the bill, meets the definition of criminal in terms of these so-called payday loans.

In the past in other speeches I have shared the unfortunate and harsh reality that my riding is the poorest riding in Canada. Whether it is measured by average family income or incidence of poverty, Winnipeg Centre is the poorest riding in the country. I bet dollars to doughnuts it has the highest concentration of these exploitative payday loan outfits because they prey on the misery of the poor. They exist solely to take advantage of low income people, desperate people. These people go from the day's drudgery to the evening's despair. They cannot make the end of the week on their meagre earnings, whether it is their paycheque or their social assistance cheque. Because of that, they wind up the victims of these payday loan outfits.

My colleague from London—Fanshawe has raised the point with us as well that every street corner we look at has a payday loan outfit. Every little strip mall that has a vacancy in our ridings is occupied immediately by another one of these payday loan outfits, be it Paymax, The Cash Store or Money Mart. All these reputable sounding names disguise the fact that they rip people off in epic proportions and in complete violation of section 347 of the Criminal Code. For the benefit of Canadians, this section states very clearly that to charge interest at a rate greater than 60% per annum is not allowed.

That provision was put there for a reason. Some of us would argue that 60% per annum is too much, that there is no justification for charging this kind of interest rate. I think the interest rate charged on my Visa is criminal, but it is legal. Visa, at 18%, may make us angry, but these guys, who set up shop to deliberately undermine the law by charging rates of interest that are easily within the realm of criminality, should be condemned, not accommodated by the bill. I call them bloodsuckers and leaches. I call them a scourge on the inner city of Winnipeg for cheating and deliberately exploiting poor people by design.

Let us look at who is doing this and how much money they are making. Where else can people get 1,000% return on their investment? A person would be pretty happy in today's stock market to be making 8%, 10% or 12% interest. In the good old days some IPO in the high tech sector could make 20% per annum interest.

These outfits are making 1,000%, 2,000%, 5,000%, 10,000% interest per annum. One example, investigated by the attorney general of Manitoba, found one cash store was making 10,000% interest, if all the surcharges and service charges are called part of the interest. For the purposes of the law, all those charges end up with net effect of interest at 10,000%.

The industry is completely unregulated. No wonder it attracts people such as the mob, the Hell's Angels and terrorist groups. Where else can they get that kind of money?

These innocuous looking, nice, clean little stores, which are popping up in every strip mall across the country, are not only sucking the lifeblood out of my inner city riding of Winnipeg Centre, but they are starving people and they are involved in clearly illegal activity. They are not only charging usurious illegal rates of interest, but charging people to cash government cheques.

Many members in the House would be shocked to learn that no one is allowed to charge for cashing a government cheque. People do not know their banking rights and that is where the blame has to come down.

We would not be having this debate today or the epidemic of rip-offs going on in our ridings if the banks were doing their job of providing basic financial services to Canadians as per their charters. If the banks had not abandoned the inner cities of Winnipeg, Vancouver, Toronto, Sault Ste. Marie and London, if they had not bailed out on this nuisance financial services industry that they do not want any more, poor people would not need to go to these rip-off outfits.

Fifteen branches of the five charter banks in my riding have left since I have been a member of Parliament. I know that 13 or 14 have left the riding of Winnipeg North, represented by my NDP colleague who is not here today. That is almost 30 branches of inner city ridings.

I am sorry, I will not point out whether my colleague is here or not today. I am actually delivering this speech on behalf of my colleague, the finance critic for the NDP, so people can draw their own conclusions as to whether she is here or not.

The fact is that roughly 30 branches of chartered banks have left, a flight of capital, leaving no financial services in their wake. People do not know that the charter banks have obligations. The charter banks of Canada were given the exclusive rights and privileges to certain very lucrative financial transactions, such as credit card statements, cheque cashing, et cetera, in exchange for providing basic service to Canadians, even when sometimes it is not the most profitable thing in the world to give ma and pa their little mortgage in downtown Winnipeg, even when it is not that profitable to allow people to open bank accounts to cash cheques even when they only have $100.

However, the banks have an obligation and a duty. If the charter banks are not willing to live up to their end of the bargain, we should tear up their charter, throw the industry wide open to foreign banks and see how they like it then. That is what they have done in some other countries when the charter banks got too big for their britches. We would not have this problem in the inner city of Winnipeg and other major Canadian cities if the banks were doing their job by providing basic financial services.

As such, the people who I know, the low income people in the inner city of Winnipeg, have no alternative, nowhere else to go to cash their cheques. They actually sport their Money Mart card, which is, frankly, a licence to be robbed, as one of their main pieces of identification. I have used the phrase before that villainy wears many masks, none so treacherous as the mask of virtue.

These Money Mart stores are trying to portray themselves as providing a necessary service. They set up brightly lit, friendly looking stores, are courteous to the low income people who walk in and they issue important looking cards that are not even credit cards but just ID cards for the Money Marts. People carry them around with some pride because the banks will not talk to them, aside from the fact banks are nowhere to be found. People do not have bank accounts but they do have Money Mart cards.

I have never been able to calculate the amount of money that gets sucked out of my riding every month by these thieves. I will call them thieves, at least until such time as the Criminal Code is changed to where we allow greater than 60% interest to be charged. They are involved in illegal activity and we are accommodating them with this bill. Instead of correcting the problem, the bill actually says that we will not stop this runaway roller coaster so we had better change the law to make it legal.

At least we are ceding the jurisdiction to the provinces so they can hopefully put in place some enabling legislation to control and contain the extent of the problem because the extent of the problem is horrific. These outfits are sprouting up like poisonous mushrooms on every street corner, if I can be forgiven for extending that analogy, because their corporate greed is responsible for a sum total of human misery on the streets of the inner city of Winnipeg that I do not think we can measure.

The very fact that people cannot make ends meet on their meagre paycheques and are forced to obtain one of these payday loans already means they are in some form of financial crisis. It is not the people we see on the TV ads, well dressed, middle class people driving their cars up to the Money Mart because they are $100 short on this month's paycheque.

The way these outfits are structured, people's problems are compounded. Their misery is only starting with the first loan because if they are a day late on that loan, they offer a rollover loan at an even higher rate of interest and more service charges. These companies suck people in and roll the money over until people have reached a level of debt that they can never get out of.

Here are other things that these outfits do. It is common practice to have people voluntarily sign a permit so their future wages can be garnished, never mind going through the courts. If somebody owes a great deal of money, sometimes companies need to apply to the courts to garnish someone's wages. However, payday companies make people sign this away at the front end.

These companies will make people put up property, if they have it, as collateral even for a couple of hundred dollar loan, which seems ridiculous, except that they know how fast a $200 loan spirals out of control to where all of a sudden it is not so ridiculous to have a house as collateral for that loan because the loan is not $200 for very long. Cars and boats are not unusual personal guarantees. Sometimes people need to sign away their right to any kind of arbitration or to the services of a credit manager.

These companies have not only figured out how to charge 1,000% or 2,000% interest, they have figured out ways to preclude the ordinary rights that people might have if they run into credit difficulty to get out from under it. In other words, they own people. Loansharking seems kind compared to these payday loans. I kind of pine for the days when it was just Luigi the leg-breaker who would take care of things. These guys are far more sinister, far more organized, far more corrupt and far more criminal. The leg-breaking that used to go on if people borrowed money at the pool hall, we would probably look forward to that compared to the hold that these companies have.

It is criminal behaviour. It is organized crime. There are chains of these companies, in effect, breaking the law systematically, the very definition of organized crime. Our reaction as a government, unfortunately, is to accommodate them and to pass legislation to allow these companies to charge more than 60% per annum. It does not say that they can charge 2,000% or 10,000% per annum as in the most extreme case that we have come across, but to accommodate them in any way is offensive to the sensibilities of any decent Canadian.

It should make us angry. It should make Canadians angry that the best thing we can think of to do when faced with this organized wholesale criminal activity is to accommodate them when we should be looking at our financial institutions to look at the root cause of the problem, which is abandonment by the charter banks.

The charter banks have packed up their tent and left, not because these branches in the inner city were not profitable, but because they were not profitable enough. Because their branch in the suburbs made more money than the branch in the inner city, they put an addition on the branch in the suburb and told their customers in the inner city to take a bus out to that branch. They closed 15 branches in my riding alone in the inner city of Winnipeg.

It is abandonment. It is a vote of non-confidence. It would not bother me if these were independent private businesses because it is their right to pack up and leave. However, these are charter banks. They exist and enjoy their exclusive monopolies at the pleasure of the House of Commons and the Government of Canada. Has nobody tried to remind the financial institutions of their obligations in recent years? They are making record profits quarter after quarter. They cannot count their money. They are like Scrooge McDuck sitting on piles of money that they cannot even imagine their good fortune and yet they are derelict of their duties and leaving the people I represent vulnerable to rip-offs like the payday loan industry.

The payday loan industry even has an association now, which is how they are striving for legitimacy. Can anyone guess who the executive director of the Payday Loan Association of Canada is?

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, I would like to congratulate my hon. colleague on her speech on Bill C-26.

In listening to her, I put myself in the shoes of citizens listening to the explanations here in the House of Commons. Unfortunately, I think that the 10 minutes given to my hon. colleague were not enough for her to delve further and provide more specific information about this bill and the reasons why the Bloc Québécois is opposed to it.

I would therefore like to ask her to be more specific for the benefit of citizens. Does this bill set a maximum interest rate for borrowers? I would also like her to tell us whether this rate is still usurious or not.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

Mr. Speaker, the purpose of Bill C-26 is to provide for stricter regulation of the payday lending industry, which could also be called the wage advances industry. In Canada, the industry began to take root in the 1990s. Its growth has not been uniform, however, since it falls under the jurisdiction of Quebec and the provinces over local commerce and civil rights and is thus subject to the rules governing contracts and consumer protection in each jurisdiction. Accordingly, while the federal government believes that this industry now has over 1,300 points of sale, they are unevenly distributed and there are not very many in Quebec.

Several payday lending companies have joined together to form the Payday Loan Association of Canada. That association represents 22 companies that operate a total of 850 points of sale for financial services across Canada, but none in Quebec.

What is a payday loan? To the Payday Loan Association of Canada, a payday loan is an unsecured small-sum short term loan typically for a few hundred dollars. The average payday loan is around $280 for a period of 10 days. We can see that payday loans are really meant for low income earners, and this is why, at this point, I want to talk about poverty.

When someone needs to borrow at a high rate from this payday lending industry in order to make it to the end of the month or the end of the week, the reason is that the person is poor in Canada. The most recent Statistics Canada figures, from the year 2000, tell us that there are 1.3 million more poor households in Canada than there were 25 years ago. So the poverty rate among the working population, among people who earn low wages and who will have to do business with this payday lending industry, has gone up.

Poverty is rising among the working population. There are poor families, and poor children, in Canada. The most alarming increase in the poverty rate for families has occurred in young families where the head of household is between 25 and 34 years old. We also see that in 1997, 56% of families headed by a single mother were living in poverty, and they accounted for 43% of poor children.

What we are seeing is rising poverty. We are going to try to deal with it by legislating, and this may be legitimate, but the fact remains that what we have seen during that time is that single-parent families, aboriginal people, people with disabilities, members of visible minorities and people with little education are the poorest people in our society. At the same time, the government is cutting funds for literacy training, social housing, the status of women—all measures that are genuinely going to help people deal with what lies at the heart of the problem. It seems to me that we cannot legislate to deal with only one aspect of the situation.

Obviously, the Criminal Code did not include a definition of payday loan. Nonetheless, it is important that we find a way of solving the problems of poverty in a more comprehensive manner, not going at them piecemeal with a bill like this. According to the federal government, a payday loan is defined as:

—a short-term loan for a relatively small amount, to be repaid at the time of the borrower's next payday.

The Financial Consumer Agency of Canada, which falls under the responsibility of the Department of Finance, indicates that it is possible to borrow via a payday loan. This is limited to 30%. I see this amount of 30% on a paycheque after the various deductions and income tax. It is often said that a family should not spend more than 30% of its income on accommodation. This leads to a very problematic situation in which payday lenders will ask their clients to give them a post-dated cheque or pre-authorized withdrawal directly from a bank account, and will add various fixed service charges as well as interest.

This seems to be a downward spiral that is difficult to stop for these less fortunate families, who, I would remind the House, are becoming even more impoverished. Certainly, more prosperous people do not resort to these lending agencies. They are more likely to go to their bank or credit union, as is the case in Quebec.

Quebec has its Consumer Protection Act. Payday lenders were once numerous in Quebec but the consumer protection bureau decided to intervene. After that, the combined efforts of the police and the consumer protection bureau all but eliminated that industry within our territory. Furthermore, the Consumer Protection Act contains strict provisions to regulate the entire lending industry.

Thus, we see that opinions are divided on Bill C-26. The Quebec government shares the Bloc Québécois' concerns because we see that, under this bill, any provinces can be granted an exemption by the federal government under certain conditions.

We feel that by placing conditions on exemptions, the federal government is interfering in one of Quebec's areas of jurisdiction. Indeed, Quebec is already regulating this industry, without having to account to the federal government. The maximum interest rate is set at 35% in Quebec, which is far less than the 60% in the Criminal Code. In addition, with its designation provision, the federal government is reserving the right to veto the measures taken by the province that requests the exemption. Although the mechanism for granting the designation is still unclear, it appears that ultimately, the Prime Minister will determine whether or not to grant the designation. Such a veto, in an area under Quebec's and the provinces' jurisdiction, seems inappropriate to us.

I will remind my colleagues in this House that Quebec does not always welcome vetoes.

The Bloc Québécois is therefore opposed to the principle of Bill C-26. However, the Bloc Québécois feels that although the federal government has the authority to include in the Criminal Code a maximum interest rate beyond which it becomes illegal to lend money, it does not have the authority to regulate industry trade practices.

The federal government does not need to decide to implement a licensing system or judge the merits of how Quebec and the provinces regulate the practices of this sector.

In our opinion, Quebec is free to regulate the trade practices of the companies under its jurisdiction, and the federal government does not need to impose a veto for the legislation to apply. Despite the Conservatives openness and respect during the election campaign, the fact is that the Harper government is carrying on the federal tradition of interfering in the jurisdictions of—

[Sue Barnes, Liberal, London West, ON]

Mr. Speaker, before the Minister of Justice attends committee, I will let him know that my party will be very happy to support this legislation in large part because when we were in government, the consultations started in 2000 with respect to this type of legislation. In fact, we were very close to bringing in legislation when the government was defeated last year.

Good consultation creates good legislation. Broad-based consultation creates good legislation. I think that is a lesson we can learn. If we do wide consultation, not only inside the minister's department but with stakeholders and people affected, we come up with a proper piece of legislation that is capable of moving through this House rapidly.

This is important and a lesson to be learned. Well defined and well consulted legislation makes efficient use of parliamentary time.

I will briefly go over some of the history. The payday loan industry, as we have heard, is a growing industry in this country. Over the last decade it has been estimated that there are more than 1,300 outlets and every year nearly 2 million Canadians utilize some aspect of the industry.

Unfortunately, along with this growth, a smaller portion of people did some practices that included some very costly practices to people who needed these services. In fact, they created things that would have been in contravention of the criminal interest rate, section 347 of the Criminal Code.

Over the course of the dialogue between the Department of Justice, Industry Canada and the Department of Finance, people came to understand that section 347 of the Criminal Code had really been instituted for the criminal organization loansharking type of activity.

The Canadian Payday Loan Association and payday loan groupings try to have a code of ethics and conduct. Even though they are not yet regulated, and hopefully will soon be regulated, in those provinces and territories, they will have to go through the scheme that is in this proposed piece of legislation, Bill C-26. We have some that are working to provide a service in a more ethical manner. Then we have some that obviously work outside the law to create as much money for themselves at the expense of people who are badly needing interim financing.

As the minister pointed out, this is not an attempt to in any way deal with the financial sector. We have the Bank Act and financial services, even though sometimes they would be dealing with less than $1,500 loan situations. We are talking about the payday loan which tends to be an unsecured loan situation for a very short period of time. As the minister has said, it is less than 62 days and the monetary limit is $1,500 or less.

We have here a sensible, working, viable scheme that will exempt those provinces that decide that it is beneficial in their jurisdiction to work with the industry to regulate and come up with some protections and regulations. Those who wish to operate in that area can do so in a manner that will be better protective of the public. That usually is a consumer protection jurisdiction of the provincial or territorial governments and not usually at this level.

That is why we had to move out of that jurisdiction and carve out an exemption in this bill to allow the provinces to do that. Some of the provinces, notably Manitoba, British Columbia, Nova Scotia and Alberta have indicated interest in doing this. Some other provinces may not be as interested. They will still be living under the Criminal Code jurisdiction and will have to enforce that situation in those jurisdictions.

It has taken a few years to get the bill ready. We are in a situation, at least in my party, to say that we do not see impediments, that this does not force any jurisdictions into making a change. It is actually more permissive. It allows them to step in and put legislation forward where they believe it is in the best interests of the people residing in their jurisdictions.

Some provinces, notably Quebec, have already operated in a different manner and the flexibility under the act is there. As noted, the designation of the province will be required under subsection 3 of the bill. In subsection 2 we have the monetary and statutory dates limitation and the licensing authorizations under the laws of the provinces. There has to be an agreement and then the province moves into the designation that is seen in subsection 3.

There is also a provision for revocation under subsection 4 that should not have to be used, but could be used if necessary and that shows some foresight. Again, interest has been defined, payday loan has been defined, and criminal interest rate is already in section 347, which has a maximum rate already.

This is progressive in that it allows jurisdictions that wish it to regulate the industry and to place limits on the costs to consumers of payday borrowing. I believe it would even have been a better ministerial speech had the minister acknowledged the work that predated his government's ascension into power as a minority government. Be that as it may, I listened to the speech by the Minister of Justice and he covered all the bases that needed to be covered in a way with which I would agree.

Having said that, this is legislation that can move forward quickly in the House. I want to reiterate that where my party sees that we can advance pieces of legislation that have been brought forward and we can support, we will do so, but where there are hastily put together, non-consultative pieces of legislation, we have to do different things in different circumstances.

With that I will end my brief comments here today and allow other parties who wish to comment in the House.

[Doug Kelsey, President and Chief Executive Director, West Coast Express]

Thank you for allowing us the opportunity to appear jointly before you today.

With me is Mr. Gary McNeil, executive director of GO Transit in Toronto; and Mr. Raynald Bélanger, the vice-president of commuter trains for Agence métropolitaine de transport. I am Doug Kelsey, president and chief executive officer of West Coast Express and SkyTrain in Vancouver. Together we represent Canada's three largest commuter rail operations.

To provide you with some background, our combined operations carry more than 125 million rides per year and represent more than $4 billion in combined public assets. The areas we represent serve approximately 30% of Canada's population. Canada's commuter rail authorities wish to make Canada's communities more livable.

As part of that, we believe we are an essential part of the solution to gridlock, greenhouse gases, and smog in Canada's urban centres. But to do more as governmental service providers, and to do more to help Canada meet its environmental goals, we require a long-term policy solution based on the principles of better and fairer urban corridor access and services for Canada's urban passenger rail authorities, at competitive rates, and based on reasonable contributions above the host railway's cost structure.

Our decision to make a joint submission to you today is the direct result of our shared interests, challenges, and points of view, as well as our dedication to serve the same ridership base as yours--the taxpaying public.

In our past submissions to the Canadian Transportation Act review commission and to this committee, we outlined the benefits of urban commuter rail service and voiced our concerns on a number of serious issues affecting our operations. We are very pleased to see that these concerns have been reflected in Bill C-11, particularly the ability to gain access to the lines of federally regulated railways by means of the dispute resolution mechanism under proposed section 152.1 of the bill. Second is the ability to have the agency determine the amount to be paid to the host railway for such access under proposed section 152.2 of the bill, should commercial negotiations not prevail successfully. There's also the ability of urban transit authorities such as AMT, GO, and West Coast Express to purchase a railway line or corridor offered for sale at net salvage value under proposed section 145.

Under access for commuter rail organizations, proposed section 152.1 addresses a major concern experienced by commuter rail authorities--our inability to gain access to the lines of federally regulated railways under the Canadian Transportation Act as it now stands. Shippers who may feel they have inadequate service have recourse under the servicer provisions of the Canadian Transportation Act. Commuter rail authorities do not have that same protection because we don't currently have the right to access. Under the proposed section 152.1, if the service being provided to a commuter rail operator is inadequate due to the inability to gain access to the federally regulated railways line, that operator may apply to the agency for specific relief.

It's unfortunate that the environment in which commuter rail service providers operate can be highly impacted by host railways. We can face unreasonably high rates, restrictive covenant provisions, and in some cases controls over the actual service specifications of our rail operations, while at the same time not being properly credited for the extensive taxpayer-funded capital that commuter rail operations provide to the host railways.

These significant contributions benefit both the railways' asset bases and the movement of freight traffic. This has been an ongoing concern recognized recently by the government in two bills that have unfortunately died on the order paper, Bill C-26, and Bill C-44. The concerns have a long history.

Some of you actually may recall that an attempt to provide commuter rail operators with some legislative protection failed some 20 years ago, back in 1986, when Bill C-97 also died on the order table. It is our hope that the outcome will be different this time around and that we will be provided with the protection necessary to allow for future access, for future expansion, and for the viability of commuter rail operations in the metropolitan communities and regions that we serve. Without these protections, our ability to support the livability and mobility of our national and regional goals will be severely limited.

In the past, the railways have advocated setting costs for arrangements with commuter rail operators based on “supply-demand” pricing for commercial negotiations. This approach can have an adverse effect for industry, because there's often no other competition or, in most cases, what is termed no effective competition or true comparatives for similar types of service.

Commuter rail is a unique service, with supply driven by corridor, not price. The current rate structure offered to commuter rail operators reflects a clear example of pricing in an environment of no competition. The economies, in some instances, are so unfortunately unfavourable that, despite public demand for services, expansion may be financially prohibitive where the commercial negotiating environment allows for no equality or checks and balances that ensure a level playing field for establishing rates and services.

However, proposed section 152.2 of the bill would prevent such high rates from being charged. Specifically, proposed subsection 152.2(2) lays out a number of factors that should be considered by the agency in determining a rate for the use of railways, land, equipment, facilities, or services. Of particular assistance to commuter rail operators is proposed paragraph 152.2(2)(b), which stipulates that a railway company's cost of capital is to be determined by a rate that is set by the agency and applied to the important net book value of the assets to be used by the public passenger service provider, minus any amount paid by the commuter rail operator in respect of those assets.

The net book value of the asset is the original cost of the asset to the railway, less depreciation. This method of determination of the cost of capital reflects the real cost that the railway incurred to purchase the asset that is being used by the commuter rail operator.

It is only reasonable and fair that the prices being charged for such use reflect the actual cost paid for the asset. Higher costs incurred by the railway to replace assets can be passed on to the commuter rail operators once the asset has been purchased. The cost of upgrades is also a factor for consideration by the agency in proposed paragraph 152.2(2)(c). Hence, there is no need to use another valuation method such as what is referred to as replacement value. Being charged excessive prices for access to operating services and infrastructure places an excessive cost burden on the Canadian commuter rail industry and the taxpayers we all serve. We are confident that proposed changes to the act will address many of our concerns in relation to service and pricing in the future.

In terms of rail line transfer and discontinuance, clause 39 of Bill C-11 proposes a change to section 145 of the act by including urban transit authorities in the list of entities to whom a rail line must be offered for sale at net salvage in the process to abandon a line. This change reflects the real possibility that a commuter rail service may be provided on a line that a railway company wants to abandon because the line is no longer used for freight traffic. Allowing an urban transit authority to purchase the line for net salvage value reflects the fact that commuter rail service is a beneficial public transportation service. It also reflects the reality, faced by many urban transit authorities, of tight operating budgets within which to provide the services we do provide.

In conclusion, we point out that the provisions of Bill C-11, when enacted, will not cause moneys to be spent from the federal treasury. The provisions of the bill contemplate the payment of fairer rates by commuter rail operators and reasonable contributions over the railway's costs. The only change to the system is that commuter rail authorities will have the right of access, a right that will level the playing field and create much-needed opportunities for commuter rail to benefit the livability of our urban centres, the economy and the environment, all for the greater good of the taxpayer and the numerous federal ministries that will benefit from the passage of this bill.

Mr. Chair, I thank you again for allowing us the opportunity to appear jointly before you today. This will conclude our formal remarks, and we'd be pleased to answer any questions that you may have.

[Vic Toews, Conservative, Minister of Justice and Attorney General of Canada]

moved that Bill C-26, An Act to amend the Criminal Code (criminal interest rate), be read the second time and referred to a committee.

Mr. Speaker, it is with pleasure that I speak today in strong support of Bill C-26, An Act to amend the Criminal Code, dealing with the criminal interest rate.

In its essence, the bill is about providing greater protection to Canadians. It is about enabling the regulation of an industry which, for better or for worse, has come to occupy a very real place in Canadian cities and towns.

Payday lending and the payday lending industry has, in the span of approximately 12 years, mushroomed in Canada to become an industry which is estimated to provide short term loan services to about two million people in Canada each year. It has a volume loan of approximately $1.7 billion annually. I was pleased to table this bill on October 6, 2006, as I believe it would enable more effective protection of Canadians everywhere.

Before discussing the substance of Bill C-26, I wish to point out that these amendments are the result of a collaborative dialogue between the territorial, provincial and federal governments. In this respect, I wish to acknowledge with thanks my colleague, the Minister of Industry, for it was the discussions among federal and provincial ministers responsible for consumer affairs who helped to ensure that these proposed amendments would meet the needs of those provincial jurisdictions which choose to regulate the industry.

It is important to situate this bill within its proper context. Doing so will enable us all to better appreciate its significance and the very important and practical consequences it would have in ensuring that everyday Canadians who use the services of the payday lending industry have enhanced protection against questionable business practices.

As I said moments ago, the payday lending industry is a relatively new one in Canada. Despite this, payday lending has, nevertheless, become a familiar fixture throughout Canada occupying prominent places on our streets in our communities. Indeed, just a few blocks away from this place, if one were to take a stroll in either direction, east down Rideau Street or south down Bank Street, the prevalence of payday lending outlets are readily noticeable. This is no different for communities throughout Canada.

The payday lending industry is believed to have first appeared in Canada around 1994. Beginning in the western provinces, the industry has since spread across the country from west to east. Whether we are talking about Prince Albert, Saskatchewan; Pembroke, Ontario; or Charlottetown, P.E.I.; the payday lending industry is there. In fact, the industry is currently operating in every province and territory in Canada except in the province of Quebec. In the case of Quebec, the inability of the payday lending industry to operate is a result of that province's decision not to issue licences to businesses that would charge more than 35% annual interest. This has effectively prevented the operation of the payday lending industry in that province.

Despite the absence in Quebec, it is estimated that there are approximately 1,350 outlets in the rest of Canada. It is clear, therefore, that the industry is well established. It is equally clear that it is time for effective government regulation of this rapidly growing industry.

We believe it is important to ensure that those Canadians who do use the services of a payday lender are provided the necessary protection from exploitative business practices, particularly so among the most vulnerable members of our community. The amendments proposed by Bill C-26 would allow for this.

It is important to be clear about what we are talking about when we speak of payday lending and the payday lending industry. The concept of a payday loan has really become shorthand for what is essentially a short term loan for a small amount. Generally, loans of this nature are in the range of $300 and extend for a period of about 10 days. The reasons that individuals choose to use the service of a payday lending industry are varied. Some use it for convenience while others use it out of necessity.

To date, loans of this nature have been provided by alternative retail lenders in Canada. Associated with this service, these alternative lenders will generally charge a range of administrative and processing fees as well as the interest associated with the borrowing of the moneys.

Qualification for these loans is generally straightforward. The borrower must first demonstrate proof of a steady income. Most obviously this is established through proof of employment, although employment is not necessarily required. Other sources of income can suffice in certain circumstances, including, for example, pension income. The borrower must have a bank account and must also provide a post-dated cheque or pre-authorized debit to the lender for the amount of the loan plus the associated fees and interest. Repayment of the loan is often due on the date of the borrower's next payday.

So in some respects, applying for and paying back a payday loan generally resembles other types of consumer lending. While the service provided is of a similar nature to other lending instruments, the specific form it takes is quite different.

For quite some time now, the payday lending industry has been the source of significant concern. Most notably, concerns have focused on the very high cost of borrowing, which in some cases can range in the thousands of per cent on an annual basis. Other concerns include the insufficient disclosure of contractual terms, aggressive and unfair debt collection practices, and the fact that these loans can quickly spiral out of control as a result of rolling over loans.

In light of these very real concerns, it is time for action.

This government has made a commitment to improve the lives of Canadian families. Bill C-26 reflects this commitment. Bill C-26 would amend the Criminal Code to enable provincial and territorial regulation of the payday lending industry. Currently, section 347 of the Criminal Code provides for an offence of entering into an agreement or arrangement to receive interest at an annual rate of more than 60%. Effectively, this creates the offence of charging interest at a criminal rate.

Section 347 was added to our Criminal Code in 1980. The principal policy rationale driving the inclusion of this provision was to address the practice of loansharking and that activity's role in relation to organized criminal behaviour. This was and remains a laudable goal. Organized crime poses a real threat to the safety and security of our communities. It did in 1980 and it continues to do so today.

Our government continues to take steps to better respond to the threats posed to our citizens and communities by organized crime. These include key legislative reforms in the area of gun crime as well as committing $200 million to strengthening the ability of the RCMP to combat organized crime. We will continue to strengthen our responses in this area, ensuring safer streets and communities for Canadians.

While section 347 may have been meant to address organized crime, the reality is that the provision has been interpreted as applying to most lending arrangements in Canada, including payday lending. Despite this fact, it is important to point out that section 347 is not a consumer protection tool.

The amendments proposed by Bill C-26 would clear the way for the provinces and the territories to create the tools they need to regulate the payday lending industry. In essence, the amendments would provide an exemption from section 347 of the Criminal Code for payday lenders under very specific and circumscribed instances. This exemption would be set out under proposed new section 347.1 of the Criminal Code.

How would this exemption scheme operate in practice? I am glad you asked that question, Mr. Speaker. First, the proposed amendments would define payday loan for the purpose of the exemption. A payday loan would be defined to mean:

an advancement of money in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbroking, a line of credit or a credit card.

While this definition may seem like a mouthful, it is an extremely important aspect of the proposed amendments. Laws and legal systems are meant to provide a certain degree of precision, clearly defining the limits of the behaviour which they purport to regulate.

By defining a payday loan in this fashion, the proposed amendments provide the precision necessary to ensure that the exemption will not capture other types of lending arrangements where the policy considerations at play are very different. These amendments are targeted in scope.

We have heard the concerns expressed by our provincial and territorial colleagues in relation to the regulation of the payday lending industry and we have demonstrated our commitment through Bill C-26 to working with them to ensure that Canadians are provided increased consumer protection measures.

The amendments would further prescribe the types of payday loan arrangements that would be subject to an exemption by providing two additional requirements. First, the amount of money advanced under the agreement cannot be more than $1,500. Second, the loan agreement cannot be for more than 62 days. These are measured and well-considered limitations. They appropriately reflect what we know to be the typical payday lending situation, that is, a short term loan for a relatively small amount.

The proposed amendments specify additional requirements before providing for the exemption from section 347 of the Criminal Code. First, the payday lender must be licensed or otherwise specifically authorized under the laws of the province or territory in which the lender is operating. This presupposes the existence of a provincial or territorial consumer protection scheme. Importantly, the provincial scheme will have to include, for the exemption to apply, a limit on the total cost of borrowing under the payday lending agreement.

Should a province or territory wish to develop such consumer protection measures to address the payday lending industry within their jurisdiction, they will further need to seek a designation from the governor in council in order to provide an exemption from the application of section 347.

In practical terms this would mean that a province or territory which seeks an exemption under section 347 would write the federal minister of justice requesting that a designation for the exemption be issued. The request would need to detail how the province complies with the requirements proposed by these amendments, namely, that the province has legislative measures providing for a consumer protection scheme in place, which includes limits on the total cost of payday borrowing.

Assuming this is the case and acting on the recommendation of the federal Minister of Industry, the Minister of Justice would then ask the governor in council to grant or not grant the exemption. At any time, the province, through its lieutenant governor in council, can request that the designation be revoked. Similarly, the governor in council can revoke the designation if the legislation which establishes the consumer protection scheme established by the province is no longer in force.

This is a sensible and effective solution to a pressing concern in Canada. Bill C-26 facilitates the development of a consumer protection scheme in what has been a largely unregulated area. In so doing, the amendments recognize the constitutional authority over business practices possessed by the provinces and territories through their responsibility over property and civil rights. These amendments acknowledge that the provinces and territories are the most suitably placed level of government to implement a protection regime for consumers which responds to the needs and local circumstances that may exist in different jurisdictions across the country.

Let me pause to point out that the proposed amendments would not apply to federally regulated financial institutions such as banks. Banks and other financial institutions in Canada are already subject to federal legislation. The amendments are specifically targeted at a currently unregulated industry. We know that there is provincial and territorial support for these changes to the Criminal Code to occur. This is because many jurisdictions have indicated that the application of section 347 has been a barrier to their being able to move forward and effectively regulate the payday lending industry.

These amendments would address provincial concerns. For example, in my home province, the government has already tabled legislation to regulate the payday lending industry. Other provinces have expressed an interest in taking similar steps. In the case where provinces choose not to regulate the payday lending industry, the Criminal Code will continue to apply.

Some may argue that the payday lending industry has no place in Canadian society. They may argue that the payday lending industry exploits the situation of already vulnerable Canadians and that facilitating the regulation of this industry will only exacerbate the situation of vulnerable Canadians.

The fact remains, however, that the payday lending industry is a part of our society, and a growing one at that, and we must take the necessary steps to bring it within the purview of regulation. Doing so will ensure that Canadian consumers have more effective protection against questionable business practices.

The amendments contained in Bill C-26 provide the provinces and territories the tools they need to respond to the problem in a manner that is appropriate to the realities facing their respective jurisdictions. I am confident that this is a sound approach to a pressing issue and one which I urge hon. members on both sides of the House to support.

Canadian Heritage

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, I want to thank the member for Bonavista—Gander—Grand Falls—Windsor and the member for Saint-Lambert for the information they are providing us today.

I was a volunteer member on the Workers Arts and Heritage Centre in Hamilton. I was really struck when I heard government members talking today about the fact that money was available, but people were not sophisticated enough to access it. It strikes me that it would be the government's responsibility to help people who are not sophisticated and need access to their government and government programs.

I was extremely disappointed to hear a government member today comparing Bill C-25, Bill C-26 and Bill C-27. These are very serious pieces of legislation. The member was saying this should be minimized debate. It sounds to me as though the government started searching for programs it wanted to cut and unfortunately it chose this one.

[Jim Abbott, Conservative, Parliamentary Secretary to the Minister of Canadian Heritage]

Mr. Speaker, I was wondering if the member might want to comment on the fact that our colleague from the Standing Committee on Canadian Heritage, the member for Saint-Lambert, has brought forward his concurrence motion at this particular time.

I have the highest respect for the member for Saint-Lambert and for his dedication to this question. Considering the fact that the Minister of Canadian Heritage and I on her behalf have made it perfectly clear that we are working toward a new museums policy, I am wondering about the timing of this debate. Today we were supposed to be debating Bill C-25 from the Minister of Finance, a bill regarding the proceeds of crime and money laundering, an important issue, Bill C-26 from the Minister of Justice, an act to amend the Criminal Code (criminal interest rate), and Bill C-27 from the Minister of Justice, an act to amend the Criminal Code (dangerous offenders and recognizance to keep the peace).

We are trying to make Canada a safer place. I am wondering if the member for Peace River would agree with me on the timing of this debate. While I respect the member's intent of trying to keep the pressure on the government, nonetheless, we have to make sure that we are keeping Canada safe, not the issue that the member has brought forward with this motion.