Bill C-14 (Historical)

Fairness at the Pumps Act

An Act to amend the Electricity and Gas Inspection Act and the Weights and Measures Act

This enactment provides for the imposition of administrative monetary penalties for contraventions to the Electricity and Gas Inspection Act and the Weights and Measures Act. It also provides for higher maximum fines for offences committed under each of those Acts and creates new offence provisions for repeat offenders.
The enactment also amends the Weights and Measures Act to require that traders cause any device that they use in trade or have in their possession for trade to be examined within the periods prescribed by regulation. That new requirement is to be enforced through a new offence provision. The enactment also provides the Minister of Industry with the authority to designate persons who are not employed in the federal public administration as inspectors to perform certain examinations.

Fairness at the Pumps Act

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, it is a great pleasure to listen to my colleague from Nanaimo--Cowichan both yesterday in the early evening and today again about something that is a hugely important consumer protection issue.

I have been hearing about it from my constituents not just this year but frankly since I was first elected. It seems to me that every long weekend, every time the weather turns nice, we see the price at the pumps going up.

I recognize that the bill that is before us today only deals with a small part of that. It deals specifically with the actual pumps and the recalibration of the pumps, but I think there is a much larger issue.

As far as I am concerned, the bill leaves the profiteering oil companies largely untouched. It goes after the small business retailers with enforced inspections, with this new mammoth bureaucracy, when really what people want is to stop the gouging at the pumps.

I wonder whether my hon. colleague has any thoughts at all about what the bill might do to some of the smaller businesses that actually operate family-run gas stations.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, the hon. member for Hamilton Mountain is right. We are coming up to a long weekend and I expect that each and every one of us will go back to our home communities and surprisingly find that gas prices have gone up 5¢ to 10¢ a litre. It is a tradition on long weekends in Canada. Sadly, it is a tradition that affects consumers. Yesterday in my speech I mentioned that low income Canadians are even harder hit by this kind of pricing. The member for Windsor West has long called for oversight on how prices at the gas pumps are arrived at.

I want to come back for a moment to why this piece of legislation was introduced. The member for Hamilton Mountain pointed out that it does not go nearly far enough and adversely impacts on small retailers. I want to refer to the Ottawa Citizen article in 2008 which talked about the report that eventually led to this piece of legislation. It said:

But using the most conservative figures, pumps that fell outside the tolerance zone would have shortchanged consumers by at least $17 million annually if projected across the entire industry. At the same time, however, fast pumps would give out $8 million in free gas. On the small percentage of pumps outside the tolerance zone, consumers come out about $9 million behind.

It went on to say:

But if pumps that passed inspection also skewed against the consumer by about the same rate within the tolerance zone, Canadian drivers would be out of pocket even more.

With about 40 billion litres of gas sold in Canada, the 0.5% variation within the legal tolerance represents a potential swing of $240 million in either direction. If the variations in gas flowing from these pumps evened out, it would have no effect on consumers. But even a small shift could represent millions of dollars.

That article points out that not only are consumers impacted by the variations in the pumps, but the small retailers are as well. Their margins are pretty tight. If they are giving out free gas, they cannot afford that. The much broader issues around regulation of gas prices and effective oversight into pump regulation require attention.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Mr. Speaker, this bill gives the great appearance of what it intends to do which is to create fairness for consumers at the pumps and at the same time make it easier for retailers, but therein lies the problem with the bill.

For retailers the Conservatives have thrown much of the enforcement into the realm of the private market. It is similar to when people wanted to receive rebates for doing work on their homes so that heat would not escape. The problem was the consumers had to pay for the inspection. It was that upfront cost. In this case what bothers me is throwing it to the private market to allow inspectors to come in and do the inspections. Unfortunately, that could cause problems for smaller retailers especially in my riding and perhaps in the member's riding as well. I would like her to comment on that.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, my riding includes a number of small towns and small retailers. We also have a very proud co-operative movement. There are a number of co-operative gas bars that service Nanaimo—Cowichan and other parts of Vancouver Island. These small retailers cannot afford to have downloading on the prices. The solution is to increase the number of government inspectors that are available--

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Random inspections.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

The member for Elmwood—Transcona is pointing out that random inspections are the way to deal with it. The government inspectors do a very good job, but they need the resources to do that job effectively. More inspectors are needed. Random inspections would certainly help to identify where there are problems.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I have never seen Conservative consumer legislation, ever, that does not have an offset for private business.

In this case, the government wants to turn a random inspection system done by government inspectors which the industry will trust over to the government's private sector friends who can charge an arm and a leg for the inspections. They will be making appointments, I presume, so the retailer will know when the inspector is showing up. I cannot think of a worst case scenario than what the government is proposing.

We had a very similar situation in Manitoba a number of years ago with automobile inspections. The inspections were done on a random basis over the course of several governments over many years. The public was satisfied with that system. Cars were called in on a random basis once or twice over a 10-year period and the required repairs were done. The Filmon Conservative government turned the system over to the private garages, which have a conflict of interest. Not only are they certifying the vehicles as safe, but they are also doing repairs. There is an incentive for them to drive up the repairs. When this system was brought in under the Filmon Conservative government, the cost of low-end cars doubled overnight.

The other thing is that an inspection is not done unless the car is being sold. If someone drove a car for 15 years, it would never be inspected no matter how many things need to be done to it. An inspection is only done when there is a change in ownership and the garage hits the owner up for maybe hundreds of dollars' worth of repairs.

This is the type of Conservative approach to consumer affairs. There is never an approach like defending air passengers by passing air passenger protection because there is no offset in that for private business. That is what the Conservative government is all about.

We would like to support legislation like this, but we would like to see it being fair to the public. We do not want it to be legislation that turns some of the public sector over to the private sector so that it can benefit. I do not think we are going to see a lot of happy private businesses.

I would like to know when we are going to hear from a Conservative speaker on this bill. I have been waiting three days now for one of the government members to speak because I have some interesting questions to ask about an unknown part of this bill, and that is the rollback of odometers. While it is covered under the Weights and Measures Act, this bill would actually increase the penalties which would cover the rollback of odometers. That is great news. Why is there no mention of this in the government press release? As a matter of fact, rollback of odometers probably costs the Canadian public much more than what shortages at gasoline pumps cost them.

I would like somebody to answer that question.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, the member for Elmwood—Transcona touched on a number of subjects in his question, but I am going to come back to the use of private sector service providers for the inspections.

There is a larger issue here. Canadians look to their government to provide some certainty around the products that they consume or fairness at the pumps. Over a number of years they have seen an erosion of that confidence in their government. We have seen toy recalls. We have seen problems with pet food. We have seen problems with cosmetics. We have seen this problem at the gas pumps. What that says to Canadians is the government is not putting the interests of Canadians first and foremost.

Private inspection agencies is simply the wrong way to go. That is a job that rightfully belongs to the government, with government inspectors and regulators.

[The Deputy Speaker, Conservative, Andrew Scheer]

I wish to inform the House that we are now at the point in the debate where the speeches will be 10 minutes and the question and comment period will be 5 minutes.

Resuming debate. The hon. member for Hamilton Mountain.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, I am pleased to rise in the House today to speak to Bill C-14, An Act to amend the Electricity and Gas Inspection Act and the Weights and Measures Act.

When it comes to transportation, we have made monumental advances in technologies. Inventions such as the train, bus and airplane have allowed us to explore the world we live in at relatively modest prices. Industrialization gave us the ability to mass produce public transit vehicles so that everyone could be free to move, but sadly, we are still using primitive and environmentally harmful petroleum fuels to propel most of our modes of transportation.

Both gasoline prices and carbon dioxide emissions are creating a growing transportation problem. As a result, governments are being forced to consider implementing better public transportation initiatives in an effort to reduce the impact of the declining oil economy on both our environment and on financial markets. What we need now from the senior levels of governments is a meaningful funding commitment to research and develop renewable energy sources that will allow municipalities, which are already struggling, to overcome their congestion and pollution problems.

In an ideal world, cycling and walking would be the preferred options for most Canadians, but unfortunately, with urban sprawl and a growing number of people who need to commute for work, they cannot avail themselves of those options. That leaves public transit as the only other sustainable solution because it is inclusive and economical, mitigates climate change and improves air quality. But progress in this area is moving at a snail's pace and in the meantime, people have few options but to stay in their cars.

That means the price of gas is an enormous factor in the day to day lives of Canadians. Whether they commute to work, travel to visit friends and family across the country, take meals to housebound seniors, drive their kids to weekend tournaments, or need gas to transport goods for small businesses, filling the tank is a constant struggle for millions of Canadians.

I have been hearing from people from right across my riding of Hamilton Mountain about the hardship that is caused by the rising price of gas, but what is worse is that they have no confidence that the price they are paying at the pump actually reflects what is happening in the market. They believe they are being hosed at the pumps. Here are just a few of the stories that they shared with me.

Jeff said, “It isn't fair that I can barely pay my bills, and paying for fuel keeps me from paying off debt, while gas companies increase their profits by billions”. Vivian said, “I'm retired and finally have some time to visit friends and family. But the car sits in the driveway because I can't afford to travel. The gouging oil companies have taken away our way of life”. Dennis wrote, “If we cannot count on the huge oil conglomerates to treat us fairly and not gouge us...the government should step in and do it for them...we are all being gouged big time”. Mark said, “The oil companies are making billions, while driving has become a luxury we can't afford. Who has the power here, the government or the oil companies?”

The price of gas drives up the cost of all commodities. From food to building supplies, manufactured goods to public services, the price of gas is a key cost driver. It affects all of us, whether we drive or not. Government has a responsibility to ensure Canadian consumers are treated fairly. It is the job of government to protect Canadians from the dubious business practices of big oil companies who steal from consumers with faulty gas pumps and gouge Canadians with price hikes inexplicably tied to weekends and warm weather.

Unfortunately, if predictably, Bill C-14 addresses only one element of that complex problem. It promises to increase fines and penalties for retailers who operate gas pumps that significantly shortchange consumers. To say that this is a day late and a dollar short is a profound understatement.

It is worth reviewing how we got here, how we got to a place where years after clear fraud has been exposed, this allegedly tough on crime government is only now getting around to proposing completely inadequate, half-baked remedies. It has been two long and expensive years since the Ottawa Citizen first reported that the government knew that its friends in the oil and gas industry had been ripping off consumers for decades. When the government was finally forced to release the Industry Canada report showing that fully 14,000 gas stations in Canada have at least one inaccurate pump, the New Democrats demanded action. The government said, “Good idea. We will get right on that”, and did precisely nothing.

During the last election campaign, the government again said to Canadians that it was going to do something about fuel pumps that deliver less fuel than the consumer paid for. The Conservatives indicated that this time they really, really meant it, yet they still did nothing. Finally, with this bill, the government has proposed an increase in fines and penalties for retailers who steal from their customers, but that addresses only part of the problem.

In advancing Bill C-14, the government has completely ignored the other critical issues that need urgent attention. In fact, the list of issues that this legislation does not address is more impressive than the legislation itself. We see no mention of the price gouging policies of big oil that mean consumers pay more for gas on long weekends and over the summer. There is no means of refunding consumers for decades of overpayment resulting from faulty pumps, estimated to amount to millions of dollars a year. There is not a word about restitution for the taxes that the government has collected on those overpayments, and this legislation is silent on the repercussions of privatizing inspection services, a move that essentially leaves the gas industry to police itself. We have seen how well that works.

The government must demonstrate that it gets it, and the bill does not do that. It is so bereft of meaningful solutions to the challenges Canadians face that one cannot help but suspect it is little more than a token to consumers, while big oil is left free to operate much as it has always done.

Then again, this is a government that has chosen to spend $6 billion this year alone on corporate tax cuts to big corporations like the oil and gas industry, so I suppose I am not surprised that this is where its priorities lie. But it is adding insult to injury by punishing hard-working Canadians even further with the much hated HST, which will increase the price of gas by another 8%.

Time and again the government shovels tax dollars by the truckload into the hands of profitable corporations while it fails to stand up for consumers. Canadians want a mechanism to protect them from the excesses of the big oil companies. They want an independent arbiter who can hear their concerns and complaints and make decisions in the public interest.

That is why I introduced Bill C-286, legislation to create an oil and gas ombudsman who would be charged with providing strong, effective consumer protection to ensure no big business could swindle, cheat or rip off hardworking families.

An oil and gas ombudsman would be an independent monitoring agency where Canadians could hold oil and gas companies accountable for their business practices. The ombudsman's office would investigate consumer and business complaints relating to price fixing, gouging and cheating, and provide for remediation. Upon receipt of a complaint, the ombudsman would then challenge gas companies to respond, and could report to the Minister of Industry for action if he or she remained unsatisfied with the response. Finally, the ombudsman's office would report annually to the House of Commons on the activities and findings of the office, so that Canadians would get accountability through their elected representatives.

It is time to shine a light on how the petroleum industry operates in this country and to hold it to account on behalf of Canadians. In a country as vast as ours and as poorly served by public transit, the ability to fill up the tank should not be a luxury. Exorbitant profits financed by price gouging and tax subsidies must be remedied.

I urge the government to do its job, to stand up for Canadian consumers and put big oil on notice that we mean business and we will hold them to account.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, members are aware that over the last 20 years, perhaps, successive studies have been done. As a matter of fact the pile is thick. I believe about 125 studies have been done on price fixing at the gas pumps. In all cases, at the end of the day the conclusion has always been that the oil companies are doing nothing wrong, when the public knows better. The fact of the matter is that the Competition Act has to be changed. That is key to this whole business.

The Bloc has introduced a bill in private members' hour, Bill C-452, to do exactly that. Under the Competition Act, it would authorize the Commissioner of Competition to inquire into an entire industry sector.

It has been pointed out many times that gas prices are much higher here than in the United States. We know there is price gouging and price fixing going on. It has been reported many, many times by people, who actually work in the gas stations, that they get a phone call from their head office and are told to raise the price. They do this with all of their stations. They do not dare question that.

That is what is really key here, but does the government make any moves in this direction? Absolutely not. Did the Liberal government do anything about this issue during its 13 years in power? Absolutely not. At the end of the day, we can only conclude that what we need is an NDP government in this country to bring in real consumer protection, because it will not happen under Conservatives or Liberals.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, I could not agree more with the conclusion of my colleague from Elmwood—Transcona. I know that is surprising.

I want to speak about his larger point because he is absolutely right. When complaints have been brought forward to the government, when there have been investigations into collusion by the oil company, the conclusion has always been that there is nothing wrong here. That simply does not pass the nod test. Canadians do not believe it and Canadians deserve confidence that their interests as consumers are being protected by the government. That is not going to happen until we have an independent review.

I would remind members of the House what happened when the government committed to Canadians that it would protect their interests during foreign takeovers. Remember that we all have to make sure foreign takeovers are to the net benefit of Canada. How many of those foreign takeovers have been turned down by the government? Only one and only at the urging of the NDP.

In the meantime, we have lost thousands and thousands of jobs from companies that have taken over what used to be solid Canadian companies with decent paying jobs. They were bought out by foreigners and we have lost the jobs. We need independent reviews.

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, I have a brief comment before I ask a question. The other NDP member asked a question with respect to the Liberals. When the Liberals were in government, the price was about $75 to $78 per barrel. The prices at the pump were about 55¢ to 60¢. We did conduct a review and we did find some form of collusion that we addressed.

How can the hon. member explain this scenario, where the price today per barrel is about $79 or $80 while at the pump it is an average of $1.02 to $1.05 per litre? Some time ago in the supposed crisis, the price per barrel was at $150 and they were charging us $1.04 or $1.05. How does this discrepancy match? My constituents are upset. They say they do not mind being fair.

The Conservative government promised during the election that it would eliminate the excise tax on anything above 85¢ per litre. It has not done so. Does she think that would also help the consumer?

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, I absolutely agree with my Liberal colleague. We have heard the exact same consumer complaints from our constituents over and over again. The gas pricing policy simply does not make sense.

He talks about the fact that one pays the same at the pumps no matter what the cost of the barrel has been when it is compared year over year. I would make the same argument that the cost of a barrel of oil somehow does not get reflected when Canadian gas prices are compared to American gas prices. On the spot market, we are still paying the same for the same barrel of oil.

He is absolutely right. There is no consumer protection here. More importantly, Canadians are right when they say this matter deserves serious investigation. We are being hosed at the pumps. We are being gouged, and we have a government that is not doing its job.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, I am pleased to rise and follow my very talented colleague from Hamilton Mountain to speak on Bill C-14, which should be called the more rip-offs at the pumps act.

As with virtually everything else the Conservative government has done, it simply does not seem to want to address Canadians' concerns. We have seen this in a number of other industries, which I will get back to in a moment. Very clearly, as the NDP critic for industry and member for Windsor West has said, the Conservative government is acting two years after the NDP first exposed the ongoing rip-offs taking place at gas pumps across the country.

Two years ago the NDP brought this forward. Two years ago the NDP started its campaign and, finally, laboriously, reluctantly, the Conservatives have brought a series of half measures to address this issue. It is simply not acceptable.

The Conservatives' underlying philosophy is that they simply do not believe in protecting Canadians. They do not believe in protecting Canadian jobs or in protecting Canadian consumers. We see this time after time.

Even with the one thing they are supposedly good at, which is their so-called anti-crime agenda, we see them cozying up to the incredibly brutal paramilitary thugs who kill people in Colombia and offering a preferential trading relationship to that regime and its secret police, paramilitaries and drug lords.

We see the difference between how Conservatives speak prior to election campaigns and what they actually do. That is why the government is in so much difficulty, not just with the repeated scandals we have seen over the past few months but also very clearly in the erosion of its support.

In British Columbia where the Conservatives brought in the HST, we are seeing a complete erosion in support. A lot of Conservative MPs from British Columbia simply will not be back in the House after the next election. British Columbians would say to bring on an election because they want to punish Conservatives for imposing the HST on them.

Getting back to Bill C-14, it is being brought forward very reluctantly by the Conservatives to address what has been a chronic mismeasurement around gas pumps. I will come back to that a little later. These faulty pumps always seem to operate against consumers. It is not as if there are cases where people are getting free gas, no siree. Consistently, hard-working Canadian consumers are being ripped off.

Two years went by before the Conservatives decided to take very reluctant action. What have they done? In this bill they have decided to, largely, privatize the inspection service. They have played around a bit with the fine component, but the problems have been inspections and the actual willingness of the government to push the industry to comply. Given that we see in this very weak bill some adjustments on fines and a privatizing of inspections, we can see that this is not an effective way of dealing with this at all.

What is not in the bill? There is no ombudsman office to evaluate problems and investigate complaints so that consumers actually have somebody to go to. The government does not want Canadian consumers to be protected in any way, whether we are talking about excessive bank fees or the rip-offs at the pumps generally and the price fixing that goes on. The government has not wanted to take action on any of those fronts. It believes in what it calls voluntary compliance, which is basically saying that we should hand over to business lobbyists the ability to determine their own rip-off regime.

In this bill there is nothing to provide consumers with an advocate to act on their behalf. It is certainly not the government. Why not an ombudsman office?

There is no refund or compensation for any consumer who has been ripped-off consistently, not only for the last two years while the NDP has been pushing this issue, but in all the investigations that have taken place over the last decade that have repeatedly found faulty pumps operating against consumers' interests. They get ripped-off because the government is not willing to act and it says that is quite all right.

The Conservatives are willing to shovel tens of billions of dollars off the back of a truck to bank lobbyists and powerful CEOs in the energy companies. They just throw money all over the place in the most irresponsible way. They never set any job targets and there is never any quid pro quo. Industry never has to respond with anything at all. However, the moment consumers are being ripped-off, all of a sudden the Conservatives say that there is no money, no refund, no compensation for them.

What about the taxes that were collected on what has been called phantom gasoline? There is no refund there either.

What we basically have through this process is a legitimization of the rip-offs that took place. This bill would just rubber stamp that. Canadian consumers have been ripped-off for years and to the government that is quite all right. It simply brings in a bill that pays some lip service to it but the Mr. and Mrs. Smiths in northern Ontario, Alberta and British Columbia are all out of luck. However, for banking CEOs, the government just shovels tens of billions of dollars toward them but because consumers come from main street they are out of luck. It is for those reasons that this bill is so lamentably inadequate.

We can look at the price-fixing that has gone on that has ripped-off Canadian consumers to a stunning degree. The Canadian Centre for Policy Alternatives estimates that one weekend of price-fixing by Canadian oil companies takes millions of dollars out of the pockets of Canadian consumers but there has been no action from the government at all.

How does that work? It is very simple. When the price spikes on a barrel of crude oil, the oil companies immediately raise the price on old stock. They purchase it at the lower price but immediately impose a new price. The Canadian Centre for Policy Alternatives and others have investigated and explained how this takes place on a systematic basis, particularly when the weather gets nice. Any change in the international price of crude oil means an immediate spike up in the price at the pump.

What happens afterward if the reverse is true? The prices do not come down. If the price of crude oil falls, the price stays up for an extended period of time. This is all windfall profits. What we have is a spike up immediately, an immediate rip-off that is then prolonged over an extended period of time.

Hard-working Canadian consumers going to work, taking their families to events and to school and supporting their communities are getting ripped-off both at the beginning and at the end. They get ripped-off with the price spike right at the beginning as a result of whatever change has taken place and they get ripped-off at the end. The Conservatives say that the consumers are out of luck. The Conservatives do not care about main street Canadians but if they are from Bay Street the government gives them tens of billions of dollars.

It is very clear that Bill C-14 would allow for the continued rip-off of Canadian consumers at the pumps. It would privatize something that should be receiving a bolstered and robust public inspection system. What do we have? We have gas companies forming their own private arm to inspect themselves. Is that the kind of voluntary compliance that Conservatives want to bring in? Is that even acceptable to Canadians? Of course not.

Canadians want to see a robust regulatory system. They want to see the public interest protected by government. This is something that the Conservatives are simply unable to even conceive. They promise it during election campaigns, as we saw in 2006 and in 2008, but they simply have not delivered.

This bill is simply ineffective. It should be called the more rip-offs at the pumps act. That is why are opposing this bill.