Evidence of meeting #14 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was banks.
A recording is available from Parliament.
9:55 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Okay, thank you.
In terms of education, has that changed during this economic crisis? Have you changed your style or your messaging?
9:55 a.m.
Commissioner, Financial Consumer Agency of Canada
I think what I'm finding is I have more of an audience now than I used to have. It was a little harder to get people to listen; now they're listening a little more closely. For me, I suppose that's the silver lining.
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Okay, thanks.
Mr. Davies, a quick question. The member organizations pay a fee to do business with Canada Deposit Insurance. Isn't that correct?
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
That is correct. They pay premiums.
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
The premium level has not been adjusted in the last few years, but as I mentioned earlier, we do examine it annually and we provide a recommendation to the government as to what premiums should be in the future year.
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
That sounds to me like you're heading for an increase, and that means another increase to the member organizations, which means an increase to consumers.
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
I won't comment as to whether or not the government would choose to make an increase, but I would point out that our rates of premiums, as compared to other jurisdictions, particularly the one south of the border, are extremely modest in the overall scheme of things. As well they should be, because we have not had a failure in recent years.
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
My time is limited. So you'll make the recommendation and the government decides. Is that correct?
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
You said in your brief that there were some changes contained in Bill C-10 to deal with troubled member institutions. Do you feel you have some troubled member institutions?
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
I think in this environment there are a lot more challenges than there were even at this time last year. Whether or not there will be any actual member institutions that find themselves so challenged as to fail, I really can't comment.
10 a.m.
Liberal
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
No, definitely we cannot name member institutions.
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
How about a sector? If you don't want to name an actual institution, would you be comfortable naming a sector, for example, banking, insurance, trust companies? Or is there a sector we should be worried about?
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
I will clarify. We do not cover insurance companies. We're restricted to deposit-taking institutions, and as I said earlier, we don't name any specific institution.
10 a.m.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
I know you have some duplication between yourselves and the OSFI, the Office of the Superintendent of Financial Institutions. A couple of years ago that was an issue. Has that been clarified?
10 a.m.
Chair of the Board, Canada Deposit Insurance Corporation
Yes. I think it's fair to say that the degree of cooperation and information-sharing is very good, not just in OSFI but in the whole structure in Ottawa.
10 a.m.
Bloc
Robert Carrier Bloc Alfred-Pellan, QC
Thank you, Mr. Chair.
Greetings, ladies and gentlemen. Obviously, we have many questions to ask you.
I will begin with Ms. Menke, from the Financial Consumer Agency of Canada. Your organization is important for all citizens.
You mentioned your website which refers to different credit cards and the different options available to consumers. Regarding the information you provide to consumers, do you focus solely on the consumption aspect? For example, different credit cards offer different advantages: some of them grant points that allow the cardholder to purchase consumer goods. Is all this information provided on your website?
10 a.m.
Commissioner, Financial Consumer Agency of Canada
Yes, we compare about 200 credit cards available in Canada and as part of these comparisons, we mention the assets, the costs, and the advantages of each card. So the price, etc., and what is offered by each card is comprised in our interactive tool.
10 a.m.
Bloc
Robert Carrier Bloc Alfred-Pellan, QC
I recently became aware that the cards called point cards, that is, that allow the holder to accumulate points, cause many problems to merchants who are invoiced higher percentages for purchases, with no discussion or negotiation. This means that they are at the mercy of the financial institutions and obviously, the additional costs entailed are passed on to the consumers without their knowing it. The consumers may think that they are benefiting individually from this system, but all consumers are affected subsequently.
Is this the type of thing that concerns you as well and that you could help rectify by issuing notices to the Department of Finance?
10:05 a.m.
Commissioner, Financial Consumer Agency of Canada
I don't even have access to the type of information you're referring to. My mandate is to ensure that consumers and financial institutions comply with the rules. Small merchants are caught between the two in a way, and I don't have a mandate concerning their activities with financial institutions. I have a mandate for consumers but not for merchants.
10:05 a.m.
Bloc
Robert Carrier Bloc Alfred-Pellan, QC
All right, fine. I have another question for you.
You referred to a project that you set up with the British Columbia Securities Commission that you would like to subsequently implement in the rest of the country. When you do that with a securities commission—because we know that there are several in Canada—do you use this as a pilot project to ascertain whether such a system functions properly, before implementing it elsewhere in the country?
10:05 a.m.
Commissioner, Financial Consumer Agency of Canada
We have already implemented this project elsewhere in the country. In English, it's called The City, and in French, La Zone. We made this program available to all Canadians last September. In fact, it was the Province of British Columbia that launched a pilot project, if you will. It had been set up before we joined forces to create the partnership that made this tool available throughout the country, to each province and territory.
