House of Commons Hansard #210 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was federal.

Topics

Petitions
Routine Proceedings

12:40 p.m.

Reform

Cliff Breitkreuz Yellowhead, AB

Mr. Speaker, according to Standing Order 36, I rise to present two petitions. The first petition is signed by almost 1,000 people, the majority coming from Yellowhead.

The petitioners call on Parliament to support legislation that would repeal and modify existing gun control laws, which have not improved public safety, have proven not to be cost effective, or have proven to be overly complex so as to be ineffective and/or unenforceable.

Petitions
Routine Proceedings

12:40 p.m.

Reform

Cliff Breitkreuz Yellowhead, AB

Mr. Speaker, the second petition I am pleased to present on behalf of Mr. Ken Rij of Evansburg, which is in the riding of Yellowhead.

The petitioners request that Parliament not amend a code, act, or charter in any way that would tend to indicate societal approval to include in the prohibited grounds of discrimination the undefined phrase sexual orientation.

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

Bonaventure—Îles-De-La-Madeleine
Québec

Liberal

Patrick Gagnon Parliamentary Secretary to Solicitor General

Mr. Speaker, the following question will be answered today: No. 139.

Question No. 139-

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

Liberal

Jim Karygiannis Scarborough—Agincourt, ON

With respect to the Interstate Unemployment Insurance Claims agreement since 1992 ( a ) how many non-Canadian citizens living outside of Canada have received benefits, ( b ) how much has been received by these beneficiaries, ( c ) how much was collected in U.I. premiums from these people, ( d ) in what states do the recipients live and ( e ) how many of the U.I. recipients collected maternity, parental, or sickness benefits?

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

Winnipeg South Centre
Manitoba

Liberal

Lloyd Axworthy Minister of Human Resources Development and Minister of Western Economic Diversification

The available data on interstate claims including those made by Canadians residing in USA for 1992, 1993 and 1994 revealed the following:

Revenue Canada requires 25 per cent of the benefit amount be retained at source for income tax. The total number of claims represents the actual number of claims received but not the number of claimants who actually were eligible for benefits. This information is not readily available. We have no available data to distinguish if the recipients are non-Canadians, or their state(s) of residence.

Revenue Canada taxation does not require that employers report premiums per individual social insurance number. Therefore we cannot specify how much was collected from these recipients. We do not have statistics on the claim types such as maternity, parental or sickness benefits.

Historically the volume of such claims has been too minimal to warrant the design of computer programming to keep such detailed information as requested.

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

Liberal

Patrick Gagnon Bonaventure—Îles-De-La-Madeleine, QC

Mr. Speaker, I ask that the remaining questions be allowed to stand.

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

The Deputy Speaker

Is it agreed?

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

Some hon. members

Agreed.

Questions On The Order Paper
Routine Proceedings

12:40 p.m.

The Deputy Speaker

I wish to inform the House that pursuant to Standing Order 33, because of the ministerial statement, Government Orders will be extended by 26 minutes.

The House resumed consideration of the motion that Bill C-75, an act to amend the Farm Improvement and Marketing Co-operatives Loans Act, be read the third time and passed.

Farm Improvement And Marketing Co-Operative Loans Act
Government Orders

12:40 p.m.

The Deputy Speaker

The hon. House leader of the Reform Party has 27 minutes remaining in his available time.

Farm Improvement And Marketing Co-Operative Loans Act
Government Orders

12:40 p.m.

Reform

Elwin Hermanson Kindersley—Lloydminster, SK

Mr. Speaker, I will assure you that I will be very brief and not need anywhere near that time, as I was in the process of concluding my remarks when I was interrupted.

The priority of governments should be to get out of the business of being in business, which includes the granting of funds, the involvement in megaprojects and things such as FIMCLA and guaranteeing loans to small business.

What I was saying in conclusion was that the priorities of governments should be first to get out of the business of granting handouts, whether they be to business or special interest groups. Second, governments should not be in the business of being involved in megaprojects, even to the point of loan guarantees; they should not be involved in loan guarantees for small business and agriculture, and their priorities in getting out should be in that order.

The reason they should be in that order is because small business and farmers are supporting the granting of funds through their tax dollars. They are supporting loan guarantees that go bad to megaprojects such as the Lloydminster upgrader and those types of megaprojects. Hibernia is another example that comes to mind. It is the farmers and the small businessmen who are paying for the folly of government getting involved in these projects. Programs like FIMCLA should not be the first ones to go; they should be the last ones to be withdrawn. That is the direction in which we have to go.

Farm Improvement And Marketing Co-Operative Loans Act
Government Orders

12:45 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, miracles never seem to happen to me in this House. I listened to the Reform Party go on and on, its members first stating they support the bill. They then spent almost all of their time saying why it was not such a good idea. I am a little confused by that approach. It seems they are saying government should not assist farmers.

Almost one in five workers in the Durham area are farmers with 3,500 families who either directly or indirectly owe their living to agriculture. The people of Durham very much appreciate the federal government's commitment to assist them in the capitalization of their farming operations.

Sometimes there is a lot of confusion in the House about what farmers do and the types of operations they run. Many members have talked about how other forms of capital are available to farmers, that lending institutions could take up the slack. That is not true. The Farm Credit Corporation and this program came into existence because the government recognized that problems within our capital markets prevent access to capital by not only small businesses but farmers in particular.

Farming is a capital intensive business. I could probably equate it with a utilities company. Everything done in farming involves substantial capital: equipment, the farm property, barns. Utilities are probably the closest example of similar operations that require capital over long periods of time.

Our lending institutions are often only interested in short term loans, which creates a disequilibrium in the capital markets. That is why this is an area government should be involved in. I know many of my farm constituents are very happy the federal government is part of this process.

I would like to speak about some of the specific aspects of Bill C-75. Some members have expressed concern over questions of overlap and duplication with the provinces. Only two provinces have similar programs, Quebec and Alberta. These are the two provinces where activity under FIMCLA has shown its greatest growth. The arguments about duplication being bad come from the very provinces that have utilized this system the most.

I heard some of my colleagues in the Bloc talking about how it was a failure. Interestingly enough, loan applications in Quebec went from 142 in 1990-91 to 1,700 in 1994-95. This is a success, hardly a failure. That growth has been largely a result of caisse populaire Desjardins' movement to become a lender under the program. In Alberta, the provincial government's treasury branches now offer FIMCLA loans and concentrate its resources in other areas. The concept of duplication is not real in this case.

Within the federal government we have to consider the different roles FIMCLA, Farm Credit Corporation and the Small Businesses Loans Act play. Of these FIMCLA is the only national loan program that can be accessed by farmers and farmer-owner marketing co-ops because FIMCLA loans are available from the six major banks. There are banks in almost all of our communities but there is not an FCC office in all communities. Similarly, the Small Businesses Loans Act is really oriented toward small business operations as opposed to farmers although farmers can also access this program.

Every rural centre has a bank or credit union but not all have FCC offices. In addition, the Farm Credit Corporation does not guarantee loans made by competing commercial lenders. Those lenders would not likely welcome audits by the FCC as is required under FIMCLA. So there is really no way FIMCLA could be offered by the FCC.

It has also been suggested that FIMCLA should be amalgamated with the Small Businesses Loans Act. The problem with this idea is that the FIMCLA loss ratio is significantly less than the SBLA program. Most FIMCLA loans are made to establish farm operations because assets taken as security for FIMCLA loans generally have a higher disposable value.

This gets back to what I was originally saying. Farms are highly capitalized, therefore they also have capital to put up for credit purposes more so than to some smaller type businesses. As a consequence there are fewer loan loss provisions. It would be unfair to charge farmers higher interest rates and registration fees to subsidize small business loan losses.

In addition, most commercial lenders have segregated their commercial lending and agricultural lending divisions. Government loan guarantee programs currently mirror this structure.

FIMCLA gives farmers a better interest rate than they could normally get and allows them borrowing credit with only 20 per cent equity. In other words, they have the ability to get up to 80 per cent financing on their assets.

Finally, there has been some confusion about the meaning of the loan cap. The legislation provides that the total amount of the loans registered over a rolling five-year period will not exceed $1.5 billion. This legislation is really quite simple in that it doubles the cap, increasing the total cap to $3 billion within the program.

The parliamentary secretary was saying earlier that we were quickly approaching that cap. If we do not pass this legislation shortly we will have to curtail the program. I can assure members that as the spring work continues on the farms that some farmers would be unduly penalized if for some reason this legislation did not continue.

I repeat, this is the total amount of loans registered over the five-year period. It is not the total amount of loans outstanding because at any one time repayments have already been made on the loans registered in the first four years of the period.

In other words, it is a total loan application. Loans come and go. The total exposure of the government is substantially less than even $1.5 billion today or $3 billion in the future as we increase the cap.

The government's liability on the program is for defaults. Historically these have been very low, around 1 to 1.5 per cent. I can assure members that this is a very significant loan loss provision. It tells members a lot about our farm communities. It tells you that these people pay their bills. In spite of the fact that they are highly capitalized, and they do have a high debt structure, once again it is because of their type of operations.

I know this quite well because I actually farmed at one time. I can tell members that every time there was an extra dollar on the farm, it seemed to go back into some form of equipment. This is why farmers are highly exposed when borrowing.

I understand that all the parties I have heard of today are still in support of this legislation. I encourage members to pass it forthwith.

Farm Improvement And Marketing Co-Operative Loans Act
Government Orders

12:50 p.m.

Prince Edward—Hastings
Ontario

Liberal

Lyle Vanclief Parliamentary Secretary to Minister of Agriculture and Agri-food

Mr. Speaker, I wonder if the member for Durham would comment on a couple of matters. I ask his views.

Earlier this morning, the member for Frontenac from the Bloc Quebecois made the statement that he did not feel that the minister of agriculture could represent farmers from the province of Quebec because he was not as fluent in both official languages as some other people might be. Does the member for Durham agree we must be totally fluent in both official languages to represent each other?

The member for Frontenac certainly professes to know about agriculture in Canada. I feel that I know a fair bit about agriculture. We may or may not be as fluent in languages as we would like to be.

I compliment the member for Durham on his comments when he explained to the House, and hopefully the member for Frontenac understands the point he was making, that there are a number of management tools and different types of loans that need to be available to primary producers and co-operatives in Canada. One is the Farm Credit Corporation, which is used for land purchases and other major purchases along that line. Another example is the farm improvement or the FIMCLA loans which are usually used for renovations, improving buildings or buying pieces of equipment which are important and can be major.

Does the hon. member agree that we need these types of vehicles? I question the sincerity of the member for Frontenac when he says this is a duplication. They are different tools serving different purposes.

Could the member for Durham comment on those two issues?

Farm Improvement And Marketing Co-Operative Loans Act
Government Orders

12:55 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, I thank the hon. member for his question.

My experience with the farm community is they can use as much help as they can get. Farmers often tell us that they are not getting enough access to capital and they wish the government would do more.

It seems incredible to me that the member for Frontenac would try to minimize the amount of access that the farm community in Quebec has to the financial institutions in that province.

Farmers can never have enough. The more people who are active in the business of financing farms the better. Certainly the federal government has shown for as long as I can remember its commitment to farming from sea to sea. I do not believe that the farmers of Quebec would want to lose that benefit.

The second point that the hon. member made was the concept that people cannot be represented here because of one language or another. I do not apologize but I am unilingual English. I have attempted to learn French from time to time but I have not been very successful. I guess I am not a good scholar in languages.

The Minister of Agriculture and Agri-Food represents all the farmers of Canada and has done so ever since I have been here. He has been to the GATT and NAFTA negotiations. I know he negotiates in the best interest of Canada from sea to sea to sea, which includes those interests which affect the farmers of Quebec.

I am very honoured that the minister of agriculture represents the agricultural community as well as he does. He has a very balanced approach. He very much tries to balance the interests of the agricultural sector in Quebec within the country as he does with all provinces. I have heard him on numerous times talking about a balanced approach, that we do not trade off one sector of commodities against another. That is nothing but good for Quebec and Canada and the operations of stable agricultural markets within our country.

I must confess I do not know the name of the agriculture minister in Quebec. I do not know the one in Ontario either. The one I do know is the federal minister of agriculture who represents us so well.

(Motion agreed to, bill read the third time and passed.)