House of Commons Hansard #221 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was environment.

Topics

Agreement On Internal Trade Implementation Act
Government Orders

7:10 p.m.

Reform

Jake Hoeppner Lisgar—Marquette, MB

Mr. Speaker, it is a pleasure to say a few words on this bill.

Trade is an important issue when it comes to agriculture. The time has come that we have to get freer trade because we see it happening with other countries. I think it is important that this bill get some serious consideration and maybe move on.

I think exactly like my colleagues in the Reform Party. This thing is going too slow, but then we are used to having this House not proceed too fast. We would not want to set too many records for speed. It could be dangerous.

It is only fair to say the position of our party is very clear: we want to do away with trade barriers. We want to make freer trade. We do not just want to trade between provinces. We want to also trade more with foreign countries.

When I look at the cost of these trade barriers of $6.5 billion to the economy of Canada, I wonder what we could do with $6.5 billion. One thing for sure is we in Manitoba could definitely afford the Winnipeg Jets. It would really buy some Liberal votes. However that does not seem to be happening too fast with this bill.

When I look at $6.5 billion it also tells me that is about the same price the infrastructure program costs and we would not have to finance one cent of that. Six and a half billion dollars less of interest a year would make quite a dint in the dollars we do spend.

Canada's domestic market is seriously fragmented by these provincial barriers. We support the removal of these interpro-

vincial barriers through a negotiated process. I do not think it can be done just by unilateral action. I think the provinces have to have some input into it. If there is co-operation among all the players this could be speeded up tremendously.

An interprovincial trade agreement should include a domestic trade dispute settlement mechanism to resolve future domestic trade disputes. Dispute settlement mechanisms work in international trade. Certainly it should also work in interprovincial trade.

The dispute settlement mechanism provided in the bill is very toothless. It reminds me a bit of a very soft hairbrush. One does not want to stir up the fuzz too much but wants to brush it aside a bit. That is one of the problems with the settlement mechanism in the bill.

If the provinces fail to co-operate in the removal of interprovincial trade barriers, the legitimacy of the obstacles should be challenged under the Constitution wherever possible. It could be quite a situation, enacting some of the constitutional powers, but if that is the only way to do away with trade barriers it would probably be worth its weight in gold.

Unfortunately we have seen over the last 100 years trade barriers being set up between provinces because they wanted little territories. Provincial premiers probably had a little more power than they should have had and eventually after three or four years could say to their electorate that they were going to protect their territory by throwing up another trade barrier. They could say: "Vote for us and things are going to improve".

So many trade barriers have been set up that we hardly know we are a country any more. We try to resolve our disputes. We try to more or less console each other by saying that one of these days we will do away with barriers but that does not take place.

The former Tory government claimed to support the removal of interprovincial trade barriers but it never used its power to remove the barriers where possible. When the Conservatives came into power in 1984 they had a lot of promises like the ones we see in the government's red book. They were to clean up the corruption and change the country.

We can see what has happened. Not only have more trade barriers probably been thrown up, but we also had an almost unbelievable debt put on us of another $400 billion or very close to it while the Conservatives were in power.

We hope the Liberals will have learned from the mistakes of the former government and will eliminate these problems. We hope they will throw away trade barriers and start making use of the $6.5 billion we could save.

It is important not to throw up trade barriers between members on one side of the House and the other. Sometimes we have some good advice for our friends across the way. Some day they will acknowledge that maybe we were right on occasion and that they could have learned from us as well as we could learn from them. The trade barrier problem is one that we should work on together to eliminate barriers as quickly as possible.

What did the Liberals say in the last Parliament? They made big promises that they were to do away with trade barriers. As we have seen the red book has quite a few promises that are very slow in coming. I hope they do not forget it. In the next election we might use that red book as flags to the provinces to prevent the Liberals from entering into power. Manitoba has almost eliminated all of them. It is important they take some notice and know what is going on. They better start honouring some of the promises.

It amazes me with the new opportunities in the global community how we can improve trade capabilities. The possibilities are there and we fail to realize them in our own country.

We can look at a $6.5 billion bill that could be cut very easily. We could make use of the interest on it to help us rejuvenate our industry and our economy.

We have to realize that we are human and things take some time. As I said the other day, when I look at the pace the Liberal government is going maybe we should go back to the horse and buggy. That is about the pace it has been doing things.

I sometimes feel a little frustrated on the committees and in the House that things do not get done the way we do it on the farm. We have three weeks to put in the crop and if we do not we are in big trouble. We have three weeks to take off the crop and if we do not we are in trouble. There are a time limits and that is exactly how I feel the bill should proceed. There should be a time limit to get the bill passed. There should be time to make amendments so that the bill is at least of some value.

The agreement does not represent a new vision for Canada that is required in this area. We have to do away with barriers faster. It is merely a rehashing of the status quo. If members want an example of how far into the future the document attempts to bring Canada's internal trade environment, they can compare it with section 121 of the British North American Act which states:

All articles of growth, produce or manufacture of any one of the provinces shall be admitted free into each of the other provinces.

I was just reminded of this when I was at home during the last break. I was walking across the fields looking at the mud and the puddles. I was very close to the border and I saw ducks going back and forth from the United States to Canada free as birds, with no problems; feathers were in the same order when they came back. I said to myself: "If birds can access boundaries with no problem, why shouldn't we as humans be able to do the same?" We always feel we are much superior when it comes to brain power, imagination and getting things done.

Article 101 of the interprovincial trade agreement states that the objective of the agreement is to reduce and eliminate to the extent possible barriers to the free movement of goods and services. I do not think the article has been fulfilled. We can still improve a lot on it and maybe speed it up. Here we have an agreement that is actually more restrictive and backward than the BNA Act from the time of Confederation.

When I look at the problem of the Liberals in Parliament climbing uphill on the debt problem, it reminds me a lot of a slippery hill that I drive through most winters. I spin my wheels a lot but I seem to go backward sometimes. If I do not get a push from somebody I do not make it to the top. That is what we in the Reform Party are trying to do. We are trying to nudge the government along to act a little faster and maybe to make a few decisions that will benefit the country.

Why do we continue to more or less reprimand, admonish or encourage the Liberals? We want a federal government that is working toward a clear and concise agreement. So far the bill is kind of muddy. As I said in a speech the other day in my constituency, we have to pay some attention to the Liberal government. Its vision is very cloudy in some of these bills. If it could get a clearer perspective things might work a little faster.

I am getting to the age where I have to use my spectacles at times. I hate them. I wish my vision was more clear without them, but as age creeps up I find that this is reality. That is what I would like to say to the government. As it gets older and if it does not start acting very quickly its vision will get more blurred. By the time the next election rolls around it probably will not even know what are the issues. I encourage the government to pay heed to some of the Reform Party advice because it has a clear vision and will keep reminding the House what it is all about.

The agreement fails to meet all the goals we hoped it would meet. We think it is ambiguous and it leaves areas untouched. When a flour mill in Manitoba cannot export its flour into a different province it makes me very sad. It is unbelievable that I can process my wheat but I cannot ship it to another province as flour. The wheat board can take my wheat and export it to foreign countries without a problem. However as a farmer I cannot process or value add and distribute it to another province. If that is not hindrance, I do not know what it is.

We have come of age in the country. We should start realizing that if we are to have free trade with foreign countries it has to happen here, or we will defeat the purpose, the time and the effort spent negotiating free trade agreements with other provinces.

The failure to obtain a ban on interprovincial barriers to agricultural products ensures that all costs associated with the barriers will continue. When I look at the cost of $6.5 billion, a lot of which is in agriculture, I am sad to see that farmers are going bankrupt. Their incomes are such that they can use every cent available. If we had freer trade it would make quite a difference. It would encourage younger farmers to be more aggressive and probably more entrepreneurial and to help further develop the country.

Agriculture has always driven the economy, especially in the western provinces. Any hindrance to agriculture is a hindrance to the whole country. If we can speed up the process and break down the trade barriers, we will be complimented for years and years to come.

There are many powerful forces currently affecting Canadian agriculture. Recent budgets have slashed the departments of agriculture and transport. The western farmer has to bear the cost of approximately $30 an acre in extra transportation costs. Any savings created by doing away with trade barriers would be very beneficial.

I talked to a farmer the other day who told me: "You know, Jake, it is amazing. I can own three sections of land anywhere between the provinces, but if I want to farm half a section on one side of the border and another half section on the other I run into problems with delivery to elevators, with permit books and with contracts. It is confusing".

This is a why we need free trade. We need to more or less dissolve the borders between provinces and make it a country, not a nation of 10 little countries such as we have right now. It is very important for future generations that we accomplish it very shortly and do not let it pass on to the next Parliament.

I was encouraged to hear my colleagues in the Bloc agree with us that trade barriers should be done away with. By doing away with the trade barriers between provinces it might even encourage people in Quebec and the Bloc to change their attitude about being a part of Canada. A freer country, a country destined to work and destined to remove inefficiencies, will make things happen that will be beneficial not just for us in our lifetime but for future generations.

We have to be encouraged that some progress has been made in the House. We want to continue on that route. The bill could be made valuable if it were given the benefit of some good amendments. There are some being proposed. I would support anything that would make the bill better, do away with the trade barriers faster and give us a chance in the future to operate as one nation, not as a nation with 10 little nations inside of it.

Every day on the news we hear what is happening in the former Yugoslavia. It does not work when a country is broken up and there are more rights for individual groups. When barriers are thrown up between people we run into problems. We create hard feelings and we will eventually wind up with some disastrous results.

Agriculture is one of the occupations with the most trade barriers. It is of the utmost importance that they be removed. I encourage every member of the House to work toward that end, to work together to make the country run, to do away with trade barriers and to use every dollar wasted to build up the economy so we can again have a healthy and prosperous country. When I think of paying $1 billion of interest every week by 1997 it scares me. That is why it is so tremendously important that we save every dime we can. It is so simple to remove the barriers, to increase production and to make things flow more easily.

I listened to my hon. colleagues speak about the oil issue. That is a product every province needs. It flows freely in a pipeline. There are no trade barriers. We do not always agree on the price but we know it is beneficial to the country.

I urge Parliament to improve Bill C-88 with amendments, to do away with trade barriers faster and to make the country work again and make this a nation in which our children and our grandchildren will be proud to live.

Agreement On Internal Trade Implementation Act
Government Orders

7:30 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, it is a real pleasure for me to stand in the House of Commons today to address Bill C-88. I cannot say I am opposed to Bill C-88. That would be like saying I am opposed to good intentions. Bill C-88 embodies the good intentions of governments, even if it does not really address the major problems facing the country with respect to interprovincial trade.

It would be very instructive to take a moment to review the red book promise with respect to free trade within the country. It is found on page 22:

Interprovincial trade within Canada is hampered by as many as 500 trade barriers, according to the Canadian Manufacturers' Association. These range from preferential procurement to non-harmonization of environmental regulations. The CMA has estimated that savings from the elimination of these barriers could be as high as $6 billion, just under 1 per cent of GDP. A Liberal government will be committed to the elimination of interprovincial trade barriers within Canada and will address the issue urgently.

To compare what I have just read from the red book with Bill C-88 we will find there is a bit of a discrepancy. Bill C-88 represents the good intentions of the government on this issue and the good intentions of some of the provinces but it does not meet the red book promise. I mark this as one more broken promise of the government.

The government made a fundamental mistake when it laid out this red book promise. I do not believe right from the outset it was completely sincere when it put those words into the red book. Although everyone would like to have interprovincial trade barriers eliminated, the government was simply not prepared in the end to do the things it should have done and needed to do to bring about a more meaningful resolution to this very important problem.

Like my hon. friend from Lisgar-Marquette, I am distressed when I hear farmers cannot move their value added product across borders.

We have talked many times about the need to diversify on the prairies to allow people to go beyond being producers of primary products and shipping them around the world in that form. We need to move them about as value added products within Canada. To me that is fairly obvious and it is very important we start to move toward that by eliminating interprovincial barriers.

Tradesmen also have similar problems not being able to cross over boundaries and have their qualifications apply. Professionals are another example, lawyers and doctors and accountants who have to write exams in each province in many cases if they want to practise in a certain province.

I will talk for a moment about some of the specific problems with Bill C-88 and where we see some of the huge loopholes or some of the ways provinces can escape from being bound by Bill C-88.

When we look at the agreement fairly closely it really does not represent any kind of a new vision for Canada. The agreement is mostly a written text of the status quo. Compared with the Constitution and section 121 of the BNA Act, it is quite a bit weaker than what is already in the Constitution. Section 121 of the BNA Act states:

All articles of growth, produce or manufacture of any one of the provinces shall be admitted free into each of the other provinces.

That is the Constitution. Let me compare it to article 101 of the provincial trade agreement which the government negotiated last summer. The objective of the agreement is to reduce and eliminate to the extent possible barriers to the free movement of goods and services.

Let us compare that with what the minister set out in his press release of March 31, 1994: "The federal government is committed to working toward an agreement which is clear and concise; has a set of rules that will eliminate protective measures; includes an effective and enforceable dispute settlement mechanism".

This agreement really fails in all of those criteria. If people look at it they will agree it is ambiguous. It leaves entire areas untouched-agriculture, certain government procurement and regional government, to name some. It does not undertake really

to eliminate trade barriers, only to the extent possible. There are all kinds of loopholes and I will touch on those in a moment. The dispute settlement mechanism is not enforceable and therefore not effective.

Let me talk specifically about some of our major concerns with the loopholes in the agreement. From part III, chapter 4, general rules, the agreement allows for a party to exempt itself from most of the constraints of articles 401, 402, 403 on the grounds of legitimate objectives. Articles 401 through 403 really are the essence of that agreement.

It is very important that those articles have some teeth. Here is what we find out. Under the agreement, legitimate objective is defined on pages 6 and 7 as the following objectives: public security and safety; public order; protection of human, animal or plant life or health; protection of the environment; consumer protection; protection of the health, safety and well-being of workers; affirmative action programs for disadvantaged groups considering, among other things, where appropriate fundamental climatic or other geographical factors, technological or infrastructure factors, or scientific justification.

We have listed almost every possible excuse under the sun for allowing people to opt out of this agreement. That is the huge fundamental flaw of the bill. I understand the government's good intentions but it simply did not come anywhere near meeting its red book promise of addressing this problem with urgency, implying it would bring about an agreement as quickly as possible. This comes nowhere near that.

Our party does not want to be completely negative. We would like to offer some constructive alternatives. One of the things the government can do, which it has not done and for which there is a growing body of evidence that it should, is bring about a court challenge and use its standing in the Constitution to actually be more in charge of interprovincial trade barriers.

Section 121 gives the federal government control over barriers within provinces. There is no reason that could not happen. I heard some hon. members from across the way talking about whether it might be preferable to get consensus, et cetera. Of course it is. We want to work with the provinces. That is very important in this day and age when our friends from Quebec, the Bloc Quebecois, are saying they want to break up the country and that kind of thing.

At the end of the day are we here to please certain special interests in different provinces which make a tremendous amount of noise and get the government's attention in those provinces or are we here for everybody, for the common good? I say we are here for the common good, to do the things we need to do of the most benefit to every man and woman in the country, not just to few who make a big noise when it looks like their little area will be jeopardized and they will no longer enjoy protection from the government.

The free market has to decide these things. If we let the free market decide we end up in a situation in which we have the cheapest possible services and goods being provided to consumers and levels of government which means more money in the pockets of consumers so they can spend on other things, which means there is money for productivity, for the economy to expand, et cetera. It is absolutely the best way to go.

That the federal government has finally come on board on the whole idea of free trade underlines it is understanding that. It fought against free trade in 1988 during the election but has now come around and we are happy to have it on our side. The government did not show the same change of heart in this bill or at least it did not show a real will to bring about the demise of interprovincial trade barriers. Unfortunately Bill C-88 has been dramatically watered down from where it should be.

Some people may ask if this is something we really want to do in the courts. I remind people listening, the government has shown no hesitation to go to court on things like enforcing the gag law legislation. It has shown no hesitation in taking extraordinary measures to cancel deals like the Pearson airport deal. I think it should show the same will when it comes to Bill C-88.

Bill C-88 is for the benefit of all Canadians; if it would only pound down interprovincial trade barriers. It has good intentions, absolutely, but we have to ask "where's the beef?" It is simply not in there.

I want to talk about how important an issue this really is. It is a huge issue that is extremely important to the country. A good article came out in the August edition of Fraser Forum by Filip Palda. He talks about a study done in British Columbia about interprovincial trade barriers:

The B.C. study is right, however, in pointing out that the CMA's estimate of the benefits of free internal trade only focuses on three areas of the economy: agriculture; alcohol and government procurement.

Somehow the $6.5 billion gain from liberating a few sectors of the Canadian economy has become entrenched in the media as an upper boundary on the benefits of free trade in all sectors. The public debate has ignored that when a market grows several things happen: costs fall and producers become more competitive. Japan is a fierce international competitor because it has a large internal market. This market is like a school where students learn from each other. Efficient producers pass into the world market while bad producers fall into mediocrity or bankruptcy. The benefit of these intangibles is hard to put a number on but the number is probably larger than the commonly cited $6.5 billion. Studies of the entire economy suggest that the annual gains could be between 6 per cent and 9.5 per cent of GNP. This translates into gains in the range of $44 billion.

Many hon. members have spoken about the $6.5 billion that came out in the CMA study. I was amazed when I first heard it. I could not believe how much money that was. I did not realize at that time, and maybe other members did not either, that it was only the CMA looking at the effects that dropping interprovincial trade barriers would have on those three sectors.

If we extend it to the full economy, $44 billion is what this gentleman is suggesting could be the benefit to Canadians. That is a tremendous amount of money. When it is realized how big that amount is and what it could do for the economy it gives us an idea of how important this issue should be to the government.

I feel the government has failed us in Bill C-88. It has not shown any urgency. It did not get the Prime Minister involved to make this happen. It did not use its ability to push this through the courts. Therefore the agreement is very much watered down. Canada is no further ahead than it was before except that the government can say it has dealt with the issue. However when I look at this I have to say where is the beef.

I want to talk about the larger scope of competitiveness and why it is important to have interprovincial trade barriers dealt with. It affects our competitiveness in the world. The economist I have just quoted, Filip Palda, pointed to that when he talked about Japan and how its internal market is so large that it really prepares people for selling around the world. That is only one thing that comes out of knocking down trade barriers.

My hon. friend from Lisgar-Marquette mentioned this a few minutes ago. The economy has problems. He talked a bit about grain producers and people who would like to add some value to the product they produce. If value added products cannot be moved between provinces there is no way that producers will be ready for the world. It is critical to be able to trade between provinces freely so that a competitive edge can be developed.

This is only one in a long legacy of areas where the government has failed to help provide that competitive edge to Canadians. The most obvious one and the one that will follow the government to its grave is the fact that it has never really dealt with the debt and the deficit. That is what is taking the competitive edge off for a lot of businesses that want to sell around the world.

The debt at $553 billion and a deficit of around $32 billion, if the projections do not go all out of whack because of a possible coming recession, have led to all kinds of problems that make it extremely difficult for businesses to get out into the world and compete. With that debt and deficit come high taxes. High taxes mean that costs go up. It also means that employees are the ones who are bearing a lot of those taxes. Will they demand higher wages? All of a sudden we have that burden to contend with. It makes it extremely difficult to deal with other countries when we have those burdens.

Another thing that happens with a big debt and deficit is all that competition for money. Canada is in a situation where it has to offer higher interest rates relative to the rest of the world. It is a problem with our main trading partner, the United States. It causes costs to go up for producers and businesses cannot be nearly as competitive as they would like to be.

The government has failed people who want to export their products, whether it is within Canada or without, on a couple of fronts. First it has failed to knock down trade barriers. By not dealing with the debt and deficit it has also caused us to be in a situation where costs are such that it is hard to compete in the world.

Another point I want to touch on briefly is the idea of training. The government and the Minister of Human Resources Development have gone to great lengths to talk about and hold studies into training and what can be done to make us more competitive in the world. The minister has created plans such as the Atlantic groundfish strategy. We all know where that has gone. There are whole towns in Newfoundland where the entire population is training to be hairdressers. That is not going to work.

The problem is that there are no jobs there. The reason there are no jobs is that the economy is so burdened with interprovincial trade barriers, so burdened with debt and taxes and interest rates that are higher than those in the U.S. for instance, relative to some of our trading partners, that we do not have jobs. Instead of worrying so much about government programs to train people, let us start providing jobs by scaling back the debt and deficit and scaling back the interest rates and taxes.

Industry and small business will create the jobs. Do not worry about the government creating them. Small business can do that better than anybody.

Let me conclude by saying that I think the government had good intentions when it brought in Bill C-88. It wanted to eliminate interprovincial trade barriers. However that is all it is, an ode to a good intention. It is something like teaching children about ethics and morals by telling them: "Never make a promise you cannot keep". The government made a promise in the red book and I do not think it kept it.

I ask hon. members to improve the bill. I ask the government to make another effort in the very near future to bring about a meaningful interprovincial trade agreement.

Agreement On Internal Trade Implementation Act
Government Orders

7:50 p.m.

Etobicoke—Lakeshore
Ontario

Liberal

Jean Augustine Parliamentary Secretary to Prime Minister

Mr. Speaker, I listened intently to the member talking in circles.

If he were to make suggestions on how the bill could be amended and not just by going around what he thinks is in the bill, what specific recommendation would he make to ensure that we would have some internal agreements between the provinces and territories in order to facilitate trade?

Agreement On Internal Trade Implementation Act
Government Orders

7:50 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, I am sorry the hon. member missed what I said in my speech. The key thing that has to be done is the federal government has to use its constitutional authority and demand at some time if a consensus cannot be reached for the greater good of all Canadians, as opposed to the special interest groups who like being protected by some of the interprovincial trade barriers, that section 121 of the Constitution be used. It has the authority. It is time to go to court to determine that is the case.

While it is good to try and reach a consensus because it is absolutely the route to go, in the end instead of thinking about provincial politicians and special interests, we have to think about Canadians. Let us do what is right for them. If it means that commerce needs to reside in the federal area let us do that. Our party has always championed decentralization. We have always been in the forefront on that because in general it works best.

However on some issues, and I would say commerce is one of them, the authority more properly rests at the federal level. That is why section 121 of the Constitution needs to reign supreme.

I believe there is growing support that this should be challenged in the courts the next time the provinces try and assert their authority in this area. I know I personally would speak very strongly in favour of pushing the issue in the courts if it comes to it.

Agreement On Internal Trade Implementation Act
Government Orders

7:50 p.m.

Liberal

Barry Campbell St. Paul's, ON

Mr. Speaker, I want to clarify if the hon. member said that provincial politicians were special interests. That is the first point on which I would like him to elaborate.

Second, did I hear him correctly when he suggested that the federal government should impose a solution on the provinces with respect to interprovincial trade rather than negotiate a solution?

Agreement On Internal Trade Implementation Act
Government Orders

7:55 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, unless I made a mistake when speaking, I really did not mean to say that provinces were special interest groups. I am saying that people in those provinces very often do constitute special interests and they do want to protect their own areas.

I guess it is whether we allow the special interest groups to impose their conditions on the rest of Canadians by making them pay a higher price for goods and services or whether the federal government uses the authority granted it under the Constitution simply to bring everybody into line and play by the rules that were laid out when the Constitution was set.

Therefore I do not think we are really imposing anything on the provinces. We are simply asking them to play by the rules that were agreed to when the Constitution was established.

Agreement On Internal Trade Implementation Act
Government Orders

7:55 p.m.

Reform

Werner Schmidt Okanagan Centre, BC

Mr. Speaker, I would like to ask my hon. colleague whether he might want to make a comment about the difference between governing and leading. Is it the role of the government to make sure that the laws of the land are obeyed and enforced or is there a need to provide some leadership, to create a vision so that the country can grow and develop and the economy can become more innovative?

Would the hon. member make a comment about those two aspects?

Agreement On Internal Trade Implementation Act
Government Orders

7:55 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, I would like to thank my hon. friend for the question.

He has hit the nail on the head. We need to have some leadership in the country. First of all the Prime Minister has to enunciate his vision of the country. Maybe he can talk about competitiveness, interprovincial trade barriers and that kind of thing.

He has to say that at the end of the day whatever we do has to be for the greater good. It has to be something that benefits the average taxpayer, the average consumer, not something that protects a group that happens to be noisy.

We have to be consistent when we follow that plan. It should be a theme that flows through all the things the government addresses, all the legislation so we do not give into noisy interests, complainers and whiners. At the end of the day, we say: "Let's do what is right for the greater good".

My friend has really hit the nail on the head. We did cave in this time to noisy special interests in many instances in Bill C-88.

Agreement On Internal Trade Implementation Act
Government Orders

7:55 p.m.

Reform

Elwin Hermanson Kindersley—Lloydminster, SK

Mr. Speaker, it is good to speak in the House over the supper hour. I see that we have more Liberals out than usual, therefore I appreciate the opportunity to be able to actually speak to members in the House on the other side.

I would like to speak to the motion and the amendment that we have presented which reads as follows:

That the motion be amended by deleting all the words after the word "that" and substituting the following therefor:

This House declines to give second reading to Bill C-88, an act to implement the agreement on internal trade because it fails to eliminate all interprovincial trade barriers.

Approximately one year ago, the Canadian people witnessed the signing of a so-called and I use that term very loosely, historical agreement on internal trade. The signing of the agreement between the Prime Minister and the premiers of the 10 provinces and the leaders of the two territories was to "reduce and eliminate to the extent possible barriers to free movement of persons, goods, services and investments within Canada and to establish an open, efficient and stable domestic market".

The Prime Minister called the signing significant, suggesting that the provincial, territorial and federal governments have taken a large step toward reducing internal trade barriers. A large step is the same as a small step if one is on a treadmill. That person is still in the same place. Likewise, we are not any closer to freer trade within Canada with this agreement than we were before.

Canada has signed the NAFTA trade agreement and the World Trade Agreement. NAFTA will possibly be including Chile. However we have failed to bring down the barriers within Canada.

A study done by John McCallum, chief economist of the Royal Bank and John Helliwell of the University of British Columbia suggests that the value of the interprovincial trade exceeds the value of trade with the United States, Mexico and Chile combined. That is astounding. The trade within Canada exceeds the trade we have in the North American continent and Chile. According to McCallum and Helliwell, "as a generator of trade, the Canadian economic union is orders of magnitude more powerful than either NAFTA or the European Union". Canada has entered into agreements with these countries to provide greater access to their markets, while we are promoting protectionism in the provinces and territories.

The agreement on internal trade does nothing to break down the walls of protectionism and allow the freeing up of interprovincial markets for companies right across the country. A study by the GATT published last year criticized the federal government and the provinces for not moving far enough in bringing down the interprovincial trade barriers. These trade barriers are inhibiting economic growth and job creation.

The bottom line is, Canadian companies are losing their competitive edge. The Canadian Chamber of Commerce, the Canadian Federation of Independent Business, the Canadian Manufacturers' Association and other business organizations are telling the government to get rid of these barriers. We may be able to hide under the shroud of protectionism in the short term, but the long term prospects are dim for this type of trade policy.

Reformers are calling out clearly to Liberals saying it is time to wake up and smell the coffee. Now is the time to bring down domestic trade barriers. It should have happened yesterday because as we know, tomorrow never comes. It is like preaching democracy abroad and practising dictatorship at home.

I say to the House that we are no closer to free trade with Bill C-88 than we are to having freer votes in the House of Commons. The word freedom and the Liberals do not seem to get along. The Liberals promised free votes but they reneged on that promise. Now they are trying to imply that we are moving toward freer trade in the country. However, when we look at the bill it is not really there. It is an illusion. It is not true.

As already stated, the Reform Party does not like the trade agreement, nor does the business community like this trade agreement. It is a bad agreement which will continue to hurt consumers' pocketbooks.

Let us talk about some examples. Within the supply managed sector of agriculture we have seen arrangements which do not make sense. For example, the province of British Columbia has approximately 13 per cent of the population but it is restricted to producing only 4.4 per cent of the industrial milk in the country. It must rely on Ontario and Quebec to supply processed milk products to consumers. Consumers of course must bear the extra cost of transporting these products to British Columbia. I am sure that dairy farmers in British Columbia would be quite open to producing larger quantities of industrial milk. This is not a level playing field and agreements such as the provisions contained in Bill C-88 do not fix the problem.

The government is further deluding farmers by suggesting that they will be able to maintain protectionist enclaves. Can the government be open and honest with farmers? Under chapter nine of the internal trade agreement the ministers have agreed to "undertake a comprehensive review of the framework governing supply managed commodities and implement an action plan toward the development of sustainable orderly marketing systems in the Canadian dairy, poultry and egg industry".

Do we need another comprehensive review of supply managed commodities? The answer is an unequivocal no. Reviews do little to prepare farmers for what they will be facing in the next few years. The time is now to move and prepare farmers for an open and more competitive market economy. Farmers may reap the benefits of this myopic thinking in the short term, but they will have to pay the price down the road if we do not correct the situation soon.

Removing the restrictions on the movement of agricultural products may be painful initially, but it will prepare farmers for the increased competition from south of the border. It will also make our domestic agricultural industry stronger rather than weaker.

I would also like to talk about a couple of other consumer products that are exempt from this trade agreement namely, alcoholic beverages and electricity. I am not much of a beer

drinker but beer drinkers will continue to be stifled when it comes to buying beer from other provinces. What if a Saskatchewan ex-patriot living in Ottawa would like a case of beer from a microbrewery in Saskatchewan? Chances are he would not be able to purchase the beer because of the trade barriers that are in place.

This brings to mind a rather interesting incident that occurred to a brewery located in my home province a couple of years ago. The brewery wanted to market its beer in Alberta. However, Alberta had placed restrictions on beers from outside the province. Even Ralph Klein's Alberta wanted to implement some trade barriers which I do not think was very good of Mr. Klein. I think he ought to review these types of policies. It does not speak well for his administration.

The brewery in Saskatchewan was forced to sell its beer at a higher price than that of the Alberta beer. To get around this, the Saskatchewan brewery placed a $2 bill inside each case of beer to offset the higher price it had to charge. Needless to say, the company was told to stop placing the money in the cases. It was a rather creative effort to market a product that was nipped in the bud and not allowed to be competitive.

Our trade arrangements are preventing companies from developing a competitive advantage by continuing this absolutely disgraceful form of protectionism.

I also want to briefly touch on electricity. It was also a product that was exempt from the agreement between the federal government and the provinces, the agreement that is embodied here in Bill C-88. The provinces and the federal government were unable to make headway on this one as well. As a result what happens? Consumers in Ontario will still be unable to use the cheaper electricity from Quebec or Manitoba which in many cases is available to them. In addition, higher rates for electricity for manufacturers are passed down by the manufacturers to the consumers in the products they produce.

Why should consumers and manufacturers be held hostage to utility companies when less expensive sources are available? Maybe such shortsightedness on the part of the Ontario government concerning interprovincial trade barriers is part of the reason that Bob Rae got dumped the other day and the people of Ontario chose another government. People are not dumb. They realize they are paying for these foolish trading practices within Canada out of their own pockets. It is not the manufacturers that pay in the long run. It is not the governments that reap the benefits of these trade barriers. It is the consumers across Canada in every province who end up being hit right in the wallet, right where it counts the most.

I want to talk about my own province. The government in the province of Saskatchewan has entered this agreement with the largest number of exemptions. I am ashamed at the number of exempt agencies in this agreement. The following government entities will be exempt from the internal trade agreement. Fasten your seat belt, Madam Speaker, because the list is long.

Treasury Board crowns include: the Agricultural Credit Corporation, Agricultural Development Fund Corporation, the Energy Conservation and Development Authority, Municipal Financing Corporation, New Careers Corporation, Prairie Agricultural Machinery Institute, Saskatchewan Crop Insurance Corporation, Saskatchewan Liquor and Gaming Authority, Saskatchewan Grain Car Corporation, Saskatchewan Government Printing Company, Saskatchewan Housing Corporation, Saskatchewan Municipal Board, Saskatchewan Research Council and Saskatchewan Wetland Conservation Corporation.

We then go on to the government enterprises, the crown investment corporations themselves. We have the encompassing CIC, the Crown Investment Corporation which is exempt from the internal trade agreement. The Saskatchewan Government Growth Fund Management Corporation is also exempt. Saskatchewan Economic Development Corporation; SaskEnergy Incorporated, which provides us with our natural gas; Saskatchewan Forest Products Corporation; Saskatchewan Gaming Corporation; Saskatchewan Government Insurance, which provides us with insurance for our cars and homes; Saskatchewan Opportunities Corporation; Saskatchewan Power Corporation; Saskatchewan Telecommunications; Saskatchewan Transportation Company; and the Saskatchewan Water Corporation are all exempt. This is a long list.

There are other boards, agencies and commissions which include: the Board of Internal Economy, the Electoral Office, the Liquor Board Superannuation Commission, the Liquor and Gaming Licensing Commission, the Saskatchewan Arts Board, the Saskatchewan Pension Plan, the Saskatchewan Power Corporation Superannuation Board, the Western Development Museum Board, the Workers' Compensation Board of Saskatchewan and the Workers' Compensation Superannuation Board. These are all exempt from Bill C-88 which is supposed to restrict interprovincial trade barriers.

The Saskatchewan government will continue to be able to procure products from local producers. The provincial government argues that preferential procurement helps local producers and lowers unemployment in the provinces. Essentially the provincial governments are taking away money from the taxpayers and returning it to local producers. Most of the time the government ends up paying the local producers more money than it would pay for the product from neighbouring provinces.

Companies outside of Saskatchewan will not have access to all the government agencies listed as exempt from the internal trade agreement. We ask the question. Will those companies lobby their provincial governments to use retaliatory measures against Saskatchewan companies competing for government contracts? This type of policy precipitates the building of trade barriers, not free trade.

I want to give another example. Just a few months before the last election I was at a trade fair in my province of Saskatchewan. I was talking to people about the Reform Party's policies and of course they were quite excited about that. They were buying memberships and were enthusiastic about Reform. They were saying that they certainly would not vote Liberal when they compared Liberals with Reformers.

I was talking to one gentleman who told me he designed security systems. He said he had been able to design a security system for a customer in the province of Alberta. I thought that was wonderful. It was good to see some entrepreneurial spirit in my province of Saskatchewan. It was good to see that this person had been able to do some work for a neighbouring province. He said that his customer had been able to buy his expertise. He also sells the equipment but he was not allowed to even put a tender in on the contract for the security system. There is a trade barrier between Alberta and Saskatchewan and his products cannot even cross the border into Alberta.

I thought, my goodness what is wrong with our province? Saskatchewan is putting up barriers not to let competitors from outside Saskatchewan deal in the province. Other provinces for example, Alberta, Manitoba, Ontario, Quebec, British Columbia are doing likewise and we are getting into a spitting war. Who is being hurt? Of course it is you and I, Madam Speaker. The Canadian citizens who have to pay the bills and pay for the product are getting the short end of the stick.

Most individuals in my province agree that discriminatory trade practices and protectionism are harmful to the province in the long run. We may win the odd little battle in this trade war but in the long run we all lose.

The current provincial government is of the opinion that it must cushion the shock of external competition by continuing the practice of preferential procurement. This will not help the people of Saskatchewan in the future when the pressures of the global community end the enclaves of protectionism. The Saskatchewan government and this Liberal government must realize that short term trends quickly become permanent policies. The time is now to prepare companies and the workforce for new opportunities.

What is the solution to the problems I have outlined? I have been very critical. I think my criticism is fair and just. It is also incumbent upon us on the opposition side to suggest some solutions. We are saying that we should eliminate all interprovincial trade barriers. It is absolutely ridiculous that it is easier to trade internationally than it is within the borders of this country.

It is insane that our trade barriers from province to province are costing consumers $6 billion to $8 billion every year. They are increasing our costs of surviving in this country. We are making more progress with Chile, the United States and our European trading partners than we are between our own provinces.

Closed systems such as the one we have in Canada fly in the face of recently signed international trade agreements. Modest estimates as I said place the cost of these trade barriers around $6 billion to $8 billion. One figure I ran across came to $6.5 billion per year.

Freeing up that amount of capital will result in market growth which will in turn result in lower prices for consumers and greater competition for producers. As I already mentioned, greater competition will prepare Canadian companies for the onslaught of freer international trade.

Reformers believe that a trade agreement can, and I want to emphasize can, be brought to fruition preferably through an agreement between the federal government and the provinces but failing that through constitutional challenges. The federal government has the power under the current Constitution to eliminate the trade barriers. I want to read section 12 of the BNA Act which states: "All articles of growth, produce or manufacture of any one of the provinces shall be admitted free into each of the other provinces". That is in our BNA Act. When will this government be prepared to take the big step off of the treadmill that is taking us nowhere and move toward freer trade in this country?

I want to close with a challenge. I challenge this government to not continue giving us nonsense like Bill C-88 which is just window dressing and no substance. I am going to ask government members to get off their hands. They have been sitting on their hands on a lot of issues.

They are sitting on their hands on this interprovincial barrier situation. I challenge the government members. They should get off their hands, and do something about the problem, really get down to brass tacks with the provincial governments. Should they refuse to bring down these trade barriers that are hurting us all, they are costing families in this country thousands of dollars in increased costs. Get down to business. And if they cannot come to an agreement with the provinces, then use some of the constitutional clout they have in the BNA Act to get the job

done. That is why we are here. We are here to work for Canadians, not to sit on our hands and complain and bring weak-kneed legislation like Bill C-88 before the House of Commons.

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8:15 p.m.

The Acting Speaker (Mrs. Maheu)

Is the House ready for the question?

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8:15 p.m.

Some hon. members

Question.

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8:15 p.m.

The Acting Speaker (Mrs. Maheu)

The question is on the amendment. Is it the pleasure of the House to adopt the amendment?

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8:15 p.m.

Some hon. members

Agreed.

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Some hon. members

No.

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8:15 p.m.

The Acting Speaker (Mrs. Maheu)

All those in favour of the amendment will please say yea.