House of Commons Hansard #172 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was tax.

Topics

Royal Assent Act
Government Orders

10:05 a.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Leader of the Government in the House of Commons

moved that Bill S-34, an act respecting royal assent to bills passed by the Houses of Parliament, be read the second time and referred to a committee.

Royal Assent Act
Government Orders

10:05 a.m.

Simcoe North
Ontario

Liberal

Paul Devillers Secretary of State (Amateur Sport) and Deputy Leader of the Government in the House of Commons

Mr. Speaker, I am pleased to rise today to speak to Bill S-34, an act respecting royal assent to bills passed by the Houses of Parliament.

The royal assent ceremony is based on the customs and conventions developed over previous centuries in the U.K. We rely on this ancient U.K. ceremony of royal assent for our own royal assent ceremony, which takes place in the Senate chamber.

I am sure that all members will agree that our royal assent ceremony is an important tradition of parliament. The ceremony lasts about 30 minutes and has taken place on 34 occasions in the course of the 36th and 37th parliaments. Each time a ceremony occurs, all MPs and senators must suspend their work on parliamentary business.

The royal assent ceremony requires the attendance of the Governor General or her deputy, a judge of the supreme court, who also have to suspend their work in order to attend the ceremony.

In recent decades, a number of issues related to royal assent have been identified by members of this House and the other place.

In 1983, the Senate launched discussions over alternatives to the procedure whereby the Governor General, in the Queen's name, signifies assent to bills passed by the Houses of Parliament.

In 1985, the standing rules and orders committee of the Senate issued its fourth report, recommending a change in the royal assent procedure. Also in 1985, in the House of Commons, the McGrath Committee Report on the Standing Orders recommended the simplification of royal assent.

In 1988, a bill on modernizing royal assent was introduced by the then leader of the government in the Senate. In 1988, the current leader of the opposition in the Senate introduced a similar bill.

The McGrath Committee and others have pointed to a number of issues regarding the royal assent ceremony. The ceremony interrupts the business of the House and the other place for approximately 30 minutes. This may have been appropriate in an earlier age, but in today's parliament, the need to stop all of the business of the House whenever royal assent is required no longer seems appropriate.

So, it is not surprising that other countries and provinces have acted to modernize the royal assent process by authorizing a written procedure for royal assent.

The traditional royal assent ceremony will also present members of this House with practical difficulties when renovations to the Centre Block begin, and continue over about eight years, with the House and Senate meeting in different buildings.

Particularly in the winter months, the maintenance of the traditional royal assent ceremony as the only way of signifying royal assent would be a burden on members of the House.

Members may be surprised to learn that Canada is the only Commonwealth country that still uses a traditional, but time consuming, royal assent ceremony on a regular basis as a sole procedure. Bill S-34 would aim to modernize the royal assent ceremony in keeping with what has been learned in other jurisdictions which share our parliamentary heritage.

In this regard members may be interested to know that the United Kingdom passed legislation in 1967 to allow royal assent by written declaration. In Australia the governor general's consent to bills is usually made known by a message to the president of the house of representatives and the speaker of the senate.

Other provinces also use the written process. In Ontario, in 1973, an all party agreement lead to the legislature waiving the formality of summoning the lieutenant governor to the chamber for royal assent. Except on special occasions the Ontario lieutenant governor now gives royal assent in her suite at Queen's Park. Quebec uses a written procedure which occurs in the offices of the lieutenant governor.

These practices by other Commonwealth countries and a number of provinces demonstrate that the written procedure of royal assent is purely a procedural matter. It does not alter the constitutional requirement for royal assent or affect the office and prerogatives of the governor general.

Section 55 of the Constitutional Act of 1867 requires that where a bill passed by the houses of parliament is presented to the Governor General for the Queen's assent, the Governor General shall declare, according to his or her discretion, whether he or she assents to the bill. This remains unaffected.

The leader of the government in the Senate has declared the Governor General's consent to the consideration of Bill S-34. It is a long-standing parliamentary practice and a matter of politeness and civility to seek royal consent before introducing any bill which might affect royal prerogatives. In keeping with this practice the government sought and obtained, and has been declared in the chambers, royal consent to proceed with Bill S-34 even if technically the bill does not affect royal prerogative since it is procedural in nature.

Bill S-34 would provide a way of maintaining an important parliamentary tradition in authorizing a simpler way of handling royal assent. First, it would preserve the royal assent ceremony as an important tradition by requiring its use twice in each calendar year including for the first appropriation bill of each session. Second, it would permit royal assent by written declaration.

The bill's provisions are procedural and relate to the form of signifying royal assent. The Governor General, or his or her deputy, would continue to exercise the royal prerogative of assent either in the Senate chamber when royal assent is done by way of ceremony or by a written declaration reported to the Speakers of the two houses of parliament. Both procedures would respect the convention that all three constituent elements of parliament, the Crown, the Senate and the House of Commons would be involved in royal assent.

By allowing royal assent by written procedure we would be able to address the concerns of a modern parliament and at the same time make the traditional ceremony a special and more visible part of our parliamentary process.

I am proud that Bill S-34 is a non-partisan bill which draws on the work of many members on both sides of this House and the other place. It follows on the McGrath Committee's recommendations. And it enjoyed the support of the leadership of both sides of the other place.

Royal assent by written declaration will remove a significant interruption in the business of this House, while preserving the royal assent ceremony as an ongoing tradition of parliament.

Bill S-34 is consistent with the practice of Commonwealth countries and provinces who use this process. For these reasons I would invite all hon. members to support the passage of this bill.

Royal Assent Act
Government Orders

10:15 a.m.

West Vancouver—Sunshine Coast
B.C.

Canadian Alliance

John Reynolds Leader of the Opposition

Mr. Speaker, I thank the government side. We will be supporting the bill wholeheartedly.

The bill will provide an alternative to the royal assent procedure currently used in the Canadian parliament so that royal assent will be signified by a written declaration similar to that used in Australia and the United Kingdom for many years. It will preserve at least one traditional royal assent ceremony per year. These procedures will take place during the parliamentary session in which both Houses pass the bill.

The first appropriation bill presented for assent in any session, however, will require a formal assent ceremony. The procedure for appropriation bills is slightly different in that the Speaker of the House of Commons presents them as a reminder that it is the House that grants aids and supplies and has the pre-eminent role in voting supply. The requirement that the first appropriation bill in a session be given royal assent in the traditional form will also assure the occasional holding of a formal ceremony.

The bill also provides that royal assent be signified in a traditional ceremony on at least one occasion in each calendar year. The bill proposes that the Speaker or person acting as the Speaker notify both the Senate and the House of Commons of a written declaration of royal assent. The bill also provides that where royal assent was signified by written declaration, the date of assent would be the day on which the declaration was reported in both chambers. This would be particularly relevant to bills that came into force upon royal assent or on a day related to the date of royal assent.

Most countries with a Westminster style of parliament have abandoned the royal assent ceremony. Canada appears to be unique among Commonwealth countries in retaining the procedure. The question of reforming the royal assent process in the Canadian parliament has arisen on a number of occasions in recent years. Throughout the eighties and nineties, committees of the House and the Senate studying parliamentary reform have all recommended that the royal assent ceremony be replaced with a written message and that the traditional practice be maintained for occasional and special uses. Bills to implement this recommendation have been drafted and have ground slowly through other parliaments, but were never given the priority to reach fruition. Perhaps it is the government's thin agenda that will finally give this new procedure life.

This change improves efficiency of the House and maintains the traditional ceremony when such a ceremony is desirable. The official opposition, as I have said, supports the bill and the official opposition would like to see more parliamentary reform, particularly in the area of private members' business. Over 70% of our members polled on this issue felt that reform was needed. Two hundred and thirty-five bills have been introduced by MPs from all political parties. None have made it past third reading. Only two House private members' bills have made it to a vote at second reading, less than 1%. The two bills that did make it into committee stage from the 36th parliament were killed in committee by the Liberal majority on those committees.

Liberals avoid voting on controversial issues by not deeming them votable. Senate private bills have been successful. The only three bills that have received royal assent have come from the Senate. They are: Bill S-10, parliamentary poet laureate; Bill S-14, Sir John A. Macdonald and Wilfrid Laurier Day; and Bill S-22, national horse of Canada. Of the 481 motions introduced, only 5 have been adopted, just over 1%.

We have had over 150 hours of debate in the House during this parliament for consideration of private members' business. If we consider that the budget of the House is $300 million, at a 1,000 hours per year that is $300,000 per hour. If we apply that to the amount of time used up by private members' business, we get $45 million of House time used to no avail.

The procedure and House affairs committee took on the task of reforming private members' business. It began in the fall of 2001 and had until April 2002 to come to some sort of arrangement to make all items votable. It decided in December 2001 that it could not do anything about it. The truth is that the government did not want to do anything about it.

Recently a rare event occurred. The Liberal majority on the procedure and House affairs committee actually allowed a bill to enjoy votable status, the bill of the member for Esquimalt--Juan de Fuca to decriminalize the use and possession of marijuana. However, as you are aware, Mr. Speaker, the government moved a poison pill amendment and had the bill withdrawn. The Prime Minister giveth and he taketh away.

The backbench should stand up to the Prime Minister and show him who is boss. It is the Prime Minister who is accountable to the House, not the other way around. If there were a few stray votes here and there, the Prime Minister might pay attention and he might even listen. He might even learn to respect the backbench, the House and democracy.

That being said, we support the bill. We wish the government well in bringing forth more reforms in the House of Commons, which members of the House from all sides would be quite happy to support.

Royal Assent Act
Government Orders

10:20 a.m.

Bloc

Bernard Bigras Rosemont—Petite-Patrie, QC

Mr. Speaker, I am pleased today to speak to Bill S-34. As some of my colleagues explained, the purpose of this bill is to change the way we proceed, in particular through the introduction of a written declaration instead of what I would describe as the traditional parade we now have.

First, I want to say that we unreservedly agree with this legislation, which should have been introduced long ago. It is also surprising that it is coming from the other chamber instead of this one. We think that a genuine modernization of our institutions must be undertaken. Not only there must be a debate about the way the assent is given, in this case through a written declaration, but also a larger debate should be launched in this House about the way, for example, we proceed with voting. Would it be possible, for example, to consider holding a debate on what is called electronic voting? Would it not be worthwhile to hold a debate on the way our institutions work in order to speed up the process and make it more effective and efficient?

Today we are going at it with a timid step, one that we approve, of course, but we also want this debate to go further, to improve the effectiveness of parliament.

Need I remind the House that this bill comes from the other place. While the elected representatives of the people should be the ones involved in modernizing Canadian institutions, this piece of legislation is coming from the Senate. Ironically, the government has refused for years to make official something that should have been made so years ago.

Concerning Bill S-34, an act respecting royal assent to bills passed by the Housesof Parliament, let me say to the House that our party will support the bill, as I said earlier, since its intent is to modernize parliament, something we have been wishing for for a long time. This is the kind of debate young parliamentarians would like. We believe that we can speed up the proceedings of parliament through very simple measures that would make this institution more efficient.

We think this bill from the other house is a legitimate one. Its intent is to modernize the royal assent procedure by enabling royal assent to be signifiedby written declaration, instead of the traditional parade we now have for each royal assent ceremony.

The government member has reminded us that this procedure was changed a long time ago in Quebec. Back in 1969, Quebec opted for the written declaration procedure for the approval of bills. It is somewhat strange that we had to wait until 2002 to do the same thing, when other institutions and modern parliaments in America decided long ago to have this procedure, which should be considered normal, official, acceptable and legitimate.

In Quebec, I would point out, royal assent has been given through what could be called a summary process since 1969. More than 30 years ago, Quebec decided, through its institution, that it would use a written declaration process. On February 27, 1969, the National Assembly adopted the second report of its standing orders review committee. This committee recommended that bills be given assent in the office of the lieutenant-governor. The report was adopted that same day. It was a step towards the modernization of parliament.

There are many other fundamental reforms the government should implement. At the very least, the government should allow private members' business introduced by members on this side not only to be debated in the House, but also to be made votable. Such a move would be the first step in the modernization of parliament. Modernization is not a hollow concept, it is a concept that can increase the efficiency of our institutions.

The House should discuss certain matters, such as the modernization of the Senate, up to and including its abolition, as well as the modernization of the traditional voting process, up to and including electronic voting.

Obviously those substantive debates, by which Canada and this institution will move in the direction of true modernization, are far from the timid bill before us. This legislation is only designed to provide a written declaration as an alternative procedure for signifying royal assent, thereby doing away with the parade. While modern legislatures in America have decided to modernize 30 years ago, we can see through this debate that, compared to initiatives taken by other legislatures here in America, and I take as an example the National Assembly of Quebec, our institution is lagging behind.

Besides, need I remind the House that during what has been called the quiet revolution in Quebec, the government of Quebec carried out an extensive reform of parliamentary institutions. As a matter of fact, on November 29, 1968, the Legislative Assembly of Quebec passed a bill abolishing the legislative council, the equivalent of the other place in this parliament.

On December 12 of the same year, the legislative council undertook consideration of the bill providing for its abolition.

The council gave speedy passage to the bill. On December 18, 1968, the act abolishing the legislative council received assent. Under this legislation, there is now only one chamber, the National Assembly, with men and women democratically elected by the people.

Royal Assent Act
Government Orders

10:25 a.m.

Some hon. member

Who are responsible to the people.

Royal Assent Act
Government Orders

10:25 a.m.

Bloc

Bernard Bigras Rosemont—Petite-Patrie, QC

They are responsible to the people and they are the ones who make the real decisions.

This bill came into force in 1968. This legislation, which basically abolished the legislative council, should also lead us to this real debate which we must have sooner or later in this House. We must not only change the procedure of royal proclamation in order to eliminate the so-called parade through a written declaration, but we must also debate what role of the Senate should really play.

Quebec was not afraid to start the Quiet Revolution and the Parliament of Canada, as an institution, ought not to fear a democratic debate that will lead eventually to a decision. That decision may not be a consensus, but it will change the way things are done.

We know that the Canadian Alliance wants to reform the Senate, while we want to abolish it. The government seems to want to keep it the way it is, and we all know why. We know that it is where they can make partisan appointments.

All that we can hope for, basically, is to make a few changes which will become official but which will not lead to any real and thorough debates on the role of that other chamber of this institution.

Need I remind hon. members that the Bloc Quebecois has done quite a lot in this connection. Back in 1996, my colleague from Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques launched a debate on abolition of the Senate. On November 6, 1996, my colleague said the following: “while programs are being reviewed everywhere,” —as we are today doing with Bill S-34—“and expenses are being cut, the government has missed a great opportunity to make an important symbolic gesture that would have proven its good faith, its desire to give the elected representatives of the people their full voice and legitimacy.”

With this, my colleague launched a debate that could well have been part of the one we are having today on Bill S-34. We know that the budget directly allocated to the Senate totals $43 million , and that the other chamber constitutes a key element in the efficiency and effectiveness of our parliamentary institutions. This is, I would remind hon. members, a chamber that is not answerable to the people, is not elected, and very often serves as a political reward to friends of the government.

The government could have taken the initiative of holding this worthwhile debate, as my colleague form the Canadian Alliance and leader of the opposition has just said, in order to enable members so desiring to introduce bills and motions, which would not only be debated but also be made votable. Once these motions and bills are deemed votable, the government should not resort to dilatory motions to prevent the House from debating these fundamental issues and voting on them.

This should allow us to embark on the real modernization we want, which should not be limited simply to the abolition of the traditional parade leading to royal assent. It should lead to a real review of our institution in order to make it more effective and to give more powers to parliamentarians, regardless of which side of the House they sit on, so that decisions can also be made more efficiently.

At the dawn of the 21st century, it is hard to see how the government can consider the Senate to be truly legitimate in any way. Could the government not simply take a step toward modernizing the Senate, something it has always refused to do? It refuses to do so because it wants it to become a patronage den. It refuses because the Senate works for its benefit, in terms of friendships and decisions.

We must reflect on the role of the Senate, because it is delaying a number of bills. It duplicates the work being done by the house and, in the end, it only symbolic. This is something we came to understand in Quebec 30 years ago, when we abolished the legislative council.

Given that this parade is purely symbolic, why is it that the Senate, which is also symbolic, does not also deserve to be abolished, as we are about to do with respect to royal assent with Bill S-34?

In closing, we support Bill S-34, to abolish this parade and have royal assent signified by written declaration. We believe that this institution must be more effective. We believe that this bill constitutes a first step, a small one, granted, toward modernizing our institutions.

For 30 years now in Quebec, this type of measure has been proven to speed up the debate process, and ultimately, the decision making process, thereby making them both more effective.

Royal Assent Act
Government Orders

10:35 a.m.

NDP

Peter Stoffer Sackville—Musquodoboit Valley—Eastern Shore, NS

Mr. Speaker, it gives me pleasure to rise on behalf of the New Democratic Party to support Bill S-34, a basic act to make the procedures of royal assent a little easier here in the House of Commons.

I also wish to state that our House leader, the member for Winnipeg--Transcona, was an integral part of the committee that brought these changes forward. We believe that his leadership on this file has assisted in many ways in getting this to the forefront of where we are today.

The question of reforming the royal assent process in the Canadian parliament has risen on a number of occasions in recent years, notably in the report of the McGrath committee of 1985. Many significant reforms to the House came out of this report. In fact our House leader, again the member for Winnipeg--Transcona, was a member of the committee which introduced, among other things, the ability to have some private members' businesses votable, maybe not as many as I personally would like but it was a start.

This is what happens when we have a very effective parliamentarian in the House of Commons from the New Democratic Party to bring these great issues forward to all levels of government and all other parties.

Bill S-34 will continue to remind us how laws are passed in Canada, how the House, the Senate and the Governor General each play a unique role in bringing legislation forward, and of the ability for us as members of parliament to bring forward issues or amendments on various pieces of legislation and watch that legislation flow through the process in a parliamentary reform.

I also want to mention the fact that although this is a very important aspect of changes to our House of Commons in terms of forming more of a simple procedure in this regard, it maintains the traditions that we hold so strongly in our parliamentary tradition. It is worth noting that the majority of members of parliament here would support this initiative. We in the New Democratic Party support this and hope to see quick passage of the bill as soon as possible.

Royal Assent Act
Government Orders

10:40 a.m.

Progressive Conservative

Peter MacKay Pictou—Antigonish—Guysborough, NS

Mr. Speaker, I am pleased to rise in the House today as well on behalf of my party, the Progressive Conservative Party of Canada, to speak to Bill S-34 which originated in the other place. It is a bill that provides an alternative procedure for the granting of royal assent to legislation while at the same time maintaining elements of the present system.

Bill S-34 did originate in the other place with the subject matter that other members have touched on and harkens back to the days of the McGrath committee of the mid-1980s. The origins however are somewhat betrayed given the snail's pace with which the government has embraced even the mildest form of parliamentary reform.

Be that as it may, this form of modernization, coming some 20 years late, should lead some members of parliament at least to rejoice in its small ray of light. Will it in fact be a symbol of change or merely a few crumbs from the PMO? I fear the latter.

When we look at the history of the legislation, it goes back to 1988 when the then leader of the Conservative government in the Senate, senator Lowell Murray, introduced a bill to modernize royal assent. The current leader of the Conservative Party in the Senate, Senator Lynch-Staunton, then took up the mantle in 1998 by introducing a similar bill known as Bill S-19. That bill had several incarnations and Senator Lynch-Staunton of the other place, a very clear thinking and hardworking senator, persevered and continued to bring this legislation back to the floor of the Senate.

What we have here in the final bill practically mirrors Senator Lynch-Staunton's good work and provides an alternative procedure for the granting of royal assent.

The practice we have seen time and time again in both this place and the other place where the Liberals would take an idea, denounce it when in opposition, then embrace it and call it their own is being followed again.

Many have argued over the years that there has been a need for an alternative to the practices which, some might argue, are time consuming, archaic and interrupt the flow of parliament. Some of the practical arguments that have been made to bolster and bring about this change talk about the practical problems. The ceremony itself has sadly fallen into some disrepute in that it is very rarely attended in any great numbers by members of this Chamber. The royal assent practice is usually delivered by a supreme court judge acting as deputy governor general. The judges themselves have raised concerns about the time constraints and the time consuming elements of their attendance.

Looking again at very practical concerns, we know there are times when the two Chambers are not sitting simultaneously, which might technically hold up or hold back certain legislation.

The royal assent ceremony is time consuming. There is also reference to the planned renovations to the House of Commons as being something that would create further challenges with respect to the practice of royal assent.

Numerous studies, including the McGrath commission, did look at ways to reform parliament and this is but one of those pearls of wisdom.

Given that the royal assent is held with such frequency, it is a ceremony as referenced that sometimes receives very little attention yet it has obvious longstanding, traditional origins with respect to the granting of the passage of bills.

There are some who take umbrage and exception to these practices, including members of the Bloc and in many ways members of the Alliance, nee the Reform Party, who were very much against the Senate until it got a senator of its own. Like some of the other practices, Alliance members have been noticeably kinder to the other places, much like their embrace of things like Stornoway, pensions and other parliamentary privileges.

With respect to the substance of the bill, the obvious reason to allow for written consents, as the bill now does, is that there are instances when the bill might be before this House while the Senate is in recess or vice versa. Often the Commons is required to technically resume sitting for the sole purposes of granting royal assent.

While I certainly respect the views of those, such as the Monarchist League of Canada, that has a branch in my riding in Nova Scotia in Pictou county, who argue that the traditional royal assent ceremony is very important, constitutionally and symbolically, it must be noted that Canada is the last commonwealth country to require royal assent be given in the presence of both Houses. We are somewhat languishing behind in the commonwealth country family in that regard.

Elsewhere in the commonwealth, including Australia, New Zealand and other countries, royal assent is usually delivered in writing. In fact this is what the bill will enable our parliament to do.

To further put to rest concerns that Bill S-34 does not require that the traditional ceremony be used, the bill allows at least once a year and for the first appropriation bill of the session, although this bill would not be invalid simply because the government failed to use the traditional ceremony within a calendar year, for the ceremony to occur at the will and whim of parliament.

The Progressive Conservative Party very much supports Bill S-34 as a snail pace, a gradual baby step forward in terms of parliamentary reform. Previous members did reference the fact that we bore witness to yet another erosion of parliamentary practice, which I think very much impinges upon the members of parliament, the members of the opposition in particular, to bring forward private and useful initiatives aimed at improving the quality of life and the workings of parliament. Two days ago we saw the government embark upon an unprecedented step of essentially killing a private member's bill, which again is a dark day for parliament.

Sadly, this incident resulted in another outburst which challenged some of the respect and goodwill that should exist around this place. Certainly the level of frustration continues to grow, not only among members of the opposition. I strongly suspect that this sentiment is shared by many of the backbench on the government side who feel these erosions of the last bastions that parliamentarians have to bring forward private initiatives and ideas is being cast aside.

Bill S-34 is one that at least symbolically shows that this place can change, modernize, adapt and become more relevant in the eyes of Canadians and in the eyes of those who participate in what sometimes seems like a circus.

The Conservative Party also wants to congratulate our colleagues in the Senate, Senator Murray and Senator Lynch-Staunton, for taking leadership on issues such as this over the years. We again commend the members of the other place for ensuring that there is an efficient use of parliamentary time and parliamentary privileges that at the same time respect the historic traditions of all who have graced these halls and all who have been fortunate enough to come to this place to represent Canadians nationwide.

Royal Assent Act
Government Orders

10:45 a.m.

The Speaker

Is the House ready for the question?

Royal Assent Act
Government Orders

10:45 a.m.

Some hon. members

Question.

Royal Assent Act
Government Orders

10:45 a.m.

The Speaker

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

Royal Assent Act
Government Orders

10:45 a.m.

Some hon. members

Agreed.

Royal Assent Act
Government Orders

10:45 a.m.

The Speaker

Accordingly the bill stands referred to the Standing Committee on Procedure and House Affairs.

(Motion agreed to, bill read the second time and referred to a committee)

Payment Clearing and Settlement Act
Government Orders

10:50 a.m.

Simcoe North
Ontario

Liberal

Paul Devillers for the Minister of Finance

moved that Bill S-40, an act to amend the Payment Clearing and Settlement Act, be read the second time and referred to a committee.

Payment Clearing and Settlement Act
Government Orders

10:50 a.m.

Oak Ridges
Ontario

Liberal

Bryon Wilfert Parliamentary Secretary to the Minister of Finance

Mr. Speaker, I welcome the opportunity to present for second reading Bill S-40 which amends the Payment Clearing and Settlement Act.

This legislation provides Canadian securities and derivative clearing houses with legal protection, similar to those in place in the United States and other G-7 countries, in the event that one of the members becomes insolvent or declares bankruptcy. Before discussing the bill, I would like to take a few minutes to provide some background which will put these changes into context.

These amendments are in line with the commitment the government made in the Speech from the Throne in January 2001 to keep Canadian laws and regulations competitive. Bill S-40 helps to meet this commitment. I want to remind the House of the government's long term plan to build a strong economy, a plan that also includes an internationally competitive economy. An efficient and strong financial sector is a key requirement for achieving a strong economy.

With the major contributions to job creation, export growth and tax revenues, Canada's financial sector is vital to the country's economic well-being. Central to a healthy financial sector is the Canadian securities and derivatives industry, its exchanges and their clearing houses.

The Canadian securities derivatives industry is a key player in Canada's financial system. Its contribution is significant. The industry provides a mechanism for raising capital and hedging financial risks through derivative contracts. It is a highly competitive industry.

For example, in recent years the number of security firms in Canada has increased from 170 in 1995 to almost 200 today. These firms are important players in Canada's securities and derivative clearing houses. The size of the industry is significant. Gross revenues in 2001 were $10 billion. In 1999 security firms assisted corporations raising $39 billion in debt and $21 billion in equity. Security firms also assisted provincial governments in raising $25 billion in debt and participated in the sale of $50 billion of Government of Canada bonds.

The Winnipeg Commodity Exchange trades over $2 million agricultural futures and options contracts per year worth about $13.5 billion. Participants trading in the Winnipeg Commodity Exchange include international grain trading companies, brokerage firms, primary and terminal elevator companies, local floor traders, financial institutions and farmers.

The bill we are debating today focuses on Canada's security derivative clearing houses, which are among the most efficient in the world. These organizations enable consumers and businesses to settle securities and derivative transactions in a timely manner and at a reasonable cost. They accomplish this by acting as a central counter party to securities and derivative trades.

In Canada, the clearing and settlement of securities derivative trades is conducted through three clearing houses. The Canadian Depository for Securities, CDS, is Canada's national securities depository clearing and settlement centre. It handles about $57 million security trades each year for banks, brokers, trust companies and other industry members. The CDS is also a custodian of securities for federally incorporated institutions like banks, trust and loan companies, insurance companies and pension funds.

The Canadian Derivatives Clearing Corporation, CDCC, is the clearing house for derivative contracts traded on the Bourse de Montreal.

The third organization, the WCE Clearing Corporation, WCECC, is the clearing house for derivative contracts relating to agricultural commodities traded on the Winnipeg Commodity Exchange, the WCE. The WCECC has an arrangement with CDCC to provide certain clearing and settlement services for the WCECC.

These three clearing houses clear and settle trades carried out on the four major exchanges in Canada. Securities and derivative exchanges underwent a major realignment in 1999 to enable them to better compete with exchanges around the world and new electronic entrants to the Canadian market. Each exchange now specializes in a certain area.

The Toronto Stock Exchange is the sole market for senior equities. Its listed companies represent a broad range of businesses from across Canada, the Untied States and other countries.

The Canadian Venture Exchange, CDNX, in Calgary, which was created through a merger of the Alberta and Vancouver stock exchanges, is the major market for junior equities. The Canadian Venture Exchange recently has been renamed the TSX Venture Exchange. Its companies are particularly active in the mining, oil and gas manufacturing and technology sectors.

The Bourse de Montréal is responsible for all non-commodities derivatives trading and other clearing services to its corporation, the CDCC. Transactions involving agricultural commodity derivatives take place on the Winnipeg Commodity Exchange, which is Canada's only agricultural futures and options exchange. Future contracts traded at the WCE include canola, canola meal, flaxseed, domestic feed wheat, western barley and field peas.

The centralized clearing and settlement services provided by clearing houses for securities and derivative markets are important in three aspects.

First, securities and derivatives markets are critical in providing opportunities to raise capital for investment and hedging financial risks.

Second, securities and derivatives markets rely upon the efficient and timely clearing and settlement of transactions through clearing houses.

Third, these clearing houses take measures to reduce risk and cost and settlement of securities and derivatives transactions.

Any factors that negatively affect the operation of these clearing houses and increase their costs will impact on the securities derivatives markets by reducing their efficiency and increasing trade costs. A potential cost to these clearing houses--