House of Commons Hansard #6 of the 40th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was agreements.

Topics

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

5:50 p.m.

NDP

Peter Julian Burnaby—New Westminster, BC

Mr. Speaker, the Conservatives are waking up. They are starting to realize they have lost this debate because, unfortunately, they made the tragic error of throwing together a bill around this bad EFTA agreement without thinking of the impacts on shipbuilding. Now that it is being thrown back at them, they are starting to awaken to the fact that Canadians are not going to tolerate a government selling out again, like it did with the softwood sellout, another major industrial sector.

The Conservatives have said that the NDP is making comments about this EFTA agreement. I started to quote the many comments we heard from shipbuilders and marine workers themselves, all of them condemning the EFTA agreement and the lack of a carve-out. Why is there not a carve-out—

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

5:50 p.m.

Conservative

The Deputy Speaker Andrew Scheer

Order, please. There are 20 seconds left for the hon. member for Welland.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

5:50 p.m.

NDP

Malcolm Allen Welland, ON

Mr. Speaker, the bottom line is we need a carve-out and all it takes is courage on behalf of parliamentarians to simply say that we will carve it out.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

5:50 p.m.

NDP

Jack Harris St. John's East, NL

Mr. Speaker, it is a pleasure to speak to the bill before the House, Bill C-2, on the European Free Trade Association trade agreement. It is important to understand what we are talking about. There are only a few countries involved: Iceland, Liechtenstein, Norway and Switzerland. There is also an agreement on agriculture between Canada and the Republic of Iceland and various agreements related to the Norway and the Swiss federation on agriculture as well. They are part of the bill.

This party believes in trade. We believe in fair trade. I know a lot of members across the way would like to guffaw about that. They seem to think that free trade is a thing we do by taking off our warm coats and exposing ourselves to the cold for reasons of fashion. It is fashionable to talk about free trade and trading with other countries.

Our party believes in fair trade. We have a lot of examples of that. The Auto Pact is one of them, where there is a fair trade agreement between Canada and the United States dealing with trade and very important commodities at serious risk today. However, the government has a very one-sided view on trade, and that is knock down the barriers and we will have free trade. However, when it chooses to do it, it seems to choose to do it with people who have already put their own industry in a position where they are anxious to enter into a free trade agreement with Canada because Canada is not willing to protect its own industries.

We have heard various speeches this afternoon. I was particularly impressed by the speech by the member for Sackville—Eastern Shore, who has been on the shipbuilding file ever since he entered the House of Commons. I have worked with him over the years on this file, as well as with other members of the shipbuilding industry, in particular, the Marine Workers Union. The Government of Newfoundland and Labrador was very interested in this, as well. Newfoundland and Labrador has a great interest in shipbuilding. The Marystown shipyard, with the Cowhead facility, has been active in building up its capacity and ability to actively participate in shipbuilding ventures. We have been following this file tremendously.

In fact, if the government of the day and the previous governments listened to the member for Sackville—Eastern Shore for the last I think 11 years, we would have a shipbuilding industry that would be able to compete on a level playing field with Norway and we would not be probably in this position opposing this aspect of the bill. We would have had what Norway has had for the last 10 or 15 years. It used to be called an industrial policy on shipbuilding.

I know industrial policy is a very unfashionable word among the think tanks of the right, industrial policy as opposed to this whole notion of “let the free enterprise system do everything”. It is some ideological mantra that has got us where we are today in the world with the collapse of the international financial markets and the stock market as a result of this blind ideology of deregulation, free trade and lack of concern over the ways in which governments can and should regulate industry, protect their national interests and ensure that the kinds of things that should be happening are happening.

We are a coastal nation, as has been mentioned before today. We have the longest coastline in the world, the Arctic, the Pacific and the Atlantic, areas where we have a national interest, whether it be on the east coast with respect to protection of our fisheries and coastal protection in general, environmental protection in the Arctic, which is very important, and in the Pacific as well. Yet we have a situation where we do not really have a shipbuilding industry policy.

I listened to the minister of state, the chief government whip. I am glad to hear that all these shipbuilding projects are, I think he said, on the books.

The books were presented to the House of Commons the other day. I did not see all these projects. I did not see the joint supply ships back on the books. I did not see the Arctic icebreakers that we need and which the government said it has to have in order to ensure our Arctic sovereignty. I did not see them on the books in the budget.

Here is a budget that is supposed to provide economic stimulus to the industrial workers of Canada. If the contract for the joint supply ships alone had gone to the Marystown facility, it would have provided about 20 years of long-term stable work, the construction phase for about eight or ten years and a longer term maintenance project for the joint supply ships, which is something that Canada needs. We all know we need it. The government knows we need it, but what did it do? A couple of days before the election was called it shut down that project. It shut down that bid.

Why did the Conservatives do that? They said the price was too high. The price was too high because the project was initially costed back in 2002. The government never made any allowances for the increase in costs of procurement and materials, labour and everything else in between. Of course, when the price eventually came in, it was over what was anticipated in terms of the budget.

There is something wrong with a government that is not prepared to recognize that if we do not move fast on projects, the costs will obviously go up and we still have to decide whether or not we need these facilities and ships.

I listened carefully to the budget and I did not hear very much about shipbuilding, but I have to say that I was very pleasantly surprised when I looked in the budget documents, the big thick book that we got with the budget. Lo and behold on page 172 of the budget there is actually a section called “Shipbuilding”.

I was very enthused because I thought that the joint supply ships would be put back, the Arctic icebreakers would be built and we would see a serious attempt by the government to recognize the needs of the shipbuilding industry in Canada. What did I find? There is a recognition of the importance of the industry with 150 establishments, 30 shipyards across the country, recognizing, contrary to what the minister of state has said, that everybody is thriving. The budget itself recognizes that in recent years the industry has experienced decline in demand which has been exacerbated by the economic downturn. The Minister of Finance must need to hear from the government whip, who would inform him that everybody is thriving and everybody is busy. However, that is not the case.

The government's response is to have a shipbuilding program, so called, that involves $175 million to build something in excess of 90, what it calls, vessels. Someone talked about conveyances or vehicles a few minutes ago, but the government calls them vessels. What are these vessels? Sixty new small craft and 30 environmental response barges. The last time I looked, a barge was not exactly a ship. It goes in the water and it floats, but I do not see it as the kind of thing we would regard as a major undertaking in the shipbuilding industry. Obviously it is very necessary, do not get me wrong, and I was delighted to see the term “shipbuilding” being used.

I was delighted to see the recognition of the importance of shipbuilding, but I was very disappointed to see that what was involved here was new small craft. It does not say how small they are. Thirty barges, five lifeboats and there were three inshore science vessels. Those are important. One is home ported in Mont-Joli, Quebec, one in Shippagan, New Brunswick and one in Saint Andrews, New Brunswick, so there are two in New Brunswick and one in Quebec. Again, we do not know how big they are. We do not know whether they play the same kind of role as the very important scientific vessels that have been operating off the east coast for the last number of years.

We see vessel extensions as part of the project. The Cape Roger, whose home port is St. John's, is one that will be given a major repair.

There is something called vessel refits. There are 35 vessels scheduled for refit. These vessels are not large craft. There are 60 small craft, 30 barges, 5 lifeboats, and 3 inshore vessels. There are 98 vessels being built along with a number of major refits totalling $175 million. As the minister of state would know, when dealing with the building of ships, that is not a lot of money, $175 million for 98 vessels, not counting the ship repairs and the major refits that are involved. That money is spread out very thinly across the country.

What we did needed to see was a recognition that a national shipbuilding program was going to be part of an ongoing effort by the government to ensure that we have a shipbuilding industry that is able to compete. It is one thing to talk about how this is going to take place over 15 years and is gradually going to go down, but what are we going to be doing in the meantime?

If the Liberal government back in the 1990s, and the Conservative government, both the current one and previous one, had listened to what the member for Sackville—Eastern Shore was saying throughout the years, we would have a shipbuilding policy and we would not be complaining about the problems of engaging in competition with Norway. This really should be taken out of the trade agreement, the same way it was taken out of the free trade agreement with the Americans.

Countries protect their interests when they are dealing with trade deals. That is why, for example, the Americans refused to repeal the Jones act. The Jones act has been around since 1920. It is a piece of legislation that protects American shipbuilding under the guise of defence. The Jones act says that with respect to commercial travel, one cannot travel between two ports in the United States without having a ship that has been built in America, is manned by Americans, is owned by Americans and operates within America. It cannot be done, unless it is on that kind of ship. Canada has no such policy. America refuses to get rid of that policy. We do not have an equivalent policy in Canada.

It appears that we have no desire to develop a shipbuilding policy that is going to protect our workers and our industry before we are forced to run head to head with the Norwegians. The shipbuilding industry has asked to have this excluded from the agreement with good reason. The industry knows what Norway has done to build and support and protect its shipbuilding industry for the last 15 years. If there was a commitment, if we had an industrial plan laid out, a long-term commitment of government funds, it might be a different story, but we have not seen that.

There is an opportunity at this time when governments are being given permission by all the economists, the public and other nations of the world to engage in economic stimulus. The conditions are most favourable for the kind of investment we are talking about, and the response from the government is $175 million to deal with 98 smallish--and I do not want to put them down totally--but smallish projects for the Canadian coast guard.

No doubt these vessels are needed. No doubt their refits are needed. We have seen inadequacies in our coast guard. In fact we have seen situations where the coast guard was so inadequately financed that the ships were staying in port. The ships were not going out because there was not enough in the budget to pay the diesel fuel to move the ships around, to protect our coastal waters, to protect our environment, to inspect the fisheries. They were staying in port because the government was not giving them enough fuel. That is the state of the support for our coast guard.

We see some change. At least the coast guard will be given some vessels that it needs, but it is not being given the support for the important role it should be undertaking in protecting our waters for environmental reasons, in protecting our Arctic sovereignty, in ensuring that fisheries patrols are carried out efficiently and effectively. These are the kinds of things that should be part of a modern, industrial, coastal nation such as Canada and they are absent here.

There is another aspect of this agreement which I will only touch on briefly because other members have talked about it. It goes back to the whole notion of fair trade. Why is it that Canada does not protect to the degree required the supply management system? It is an important way that we secure our food supply. Food security in an uncertain world is becoming more and more important. It is going to become even more important as we see the ravages of climate change on food production in other parts of the world, as well as in Canada.

We have to recognize that part of our responsibilities as a government and as a people is to ensure that food supply is available when we need it, that production is here, and that the people who are engaged in the production have an opportunity to make a reasonable living. They play an important role in ensuring that our economy is safe from the kind of vicissitudes that can occur when trading goes awry or when food supplies go awry and we do not have the kind of supply that we have built up through a totally free trade system coming from other nations.

Supply management is part of that. It is a building block for a fair trade system and should be protected better than it is in this particular agreement.

Supply management plays an important role in ensuring that production occurs across our country. Some of our colleagues from Quebec have spoken about the importance of the dairy industry to that province and I agree. In Newfoundland and Labrador, for example, by securing part of the quota for industrial milk, it has been able to build its post-production with commercial milk, yogourt and other dairy products. These are value-added products from industrial milk quotas protected by the supply management system, a necessary kick-start to an industry that would have great difficulty growing on its own, especially with the cheap products coming in from outside the region, because they have had an opportunity to build up an industry over a longer period of time.

These are the two main problems that we have with the agreement. Why is it that there cannot be a carve out of the shipbuilding industry? It should be taken out. In the absence of a rather robust and long-term commitment for shipbuilding and industrial policies in this country, our shipbuilding industry will be put at risk. This is something that we do not want to happen.

Those are my remarks. I would be pleased to respond to any questions or comments from members on this matter.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:10 p.m.

Chilliwack—Fraser Canyon
B.C.

Conservative

Chuck Strahl Minister of Indian Affairs and Northern Development and Federal Interlocutor for Métis and Non-Status Indians

Mr. Speaker, I would like to comment on what the member had to say.

It is interesting to preface the remarks that the NDP members really are free traders at heart, but they just cannot support this free trade agreement. Of course they could not support the Canada-Israel free trade agreement. They voted against the Canada-Costa Rica free trade agreement. They promised to vote against the Colombian free trade agreement, the Peru free trade agreement, and any other free trade agreement that would come before this House, but other than that, they are fully in favour of free trade. That is very interesting.

When it comes to supply management, I was in Geneva, I was in Davos representing supply management and agriculture during those discussions. We are the government that brought in compositional standards for the dairy industry. On behalf of my government, I received the first and only standing ovation ever given to a minister, because we actually moved ahead on all that. We actually believed in all that. We actually supported all that. That is why we made sure in this agreement that supply managed industries are protected. They are protected. The member should read the agreement.

There are a couple of other things. One is that when it comes to a domestic shipbuilding industry, the hon. minister has already made mention of how the work that is lined up in the shipbuilding industry in Canada is not only for this year but it stretches out for the next 10 years. There is a lot of good work with lots of well-paying jobs all across the country, wherever there are shipbuilding facilities. That is good news. That is because of the actions this government has taken on a procurement basis to make sure that that happened. There may have been empty work yards a year ago, but it is not happening now. It is not only good news now, but it stretches off into the future.

Regarding the NDP's solution to shipbuilding, members could go to B.C. and see that just offshore there is $450 million tied up in an NDP fiasco called the fast ferries. Anytime we want to witness how the NDP shipbuilding strategy works, there are empty vessels parked on shore at taxpayers' expense that have never turned a wheel. That is the trouble with economic illiteracy and it is abounding in the NDP in this debate today.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:10 p.m.

NDP

Jack Harris St. John's East, NL

Mr. Speaker, I want to congratulate the member on his standing ovation in Switzerland for his support for supply management in this country. I have not seen him getting many standing ovations on this side of the House on the actions of his government with respect to the Wheat Board either.

If the minister is actively supporting supply management and prepared to defend that in international agreements and in all international efforts, I want to thank him for that. I think that is what the government has to do and has to do vigorously.

As to his comments about the NDP being free traders at heart but simply do not support free trade agreements, what I said was that we believe in fair trade. Fair trade has elements of free trade, but it has elements of ensuring that we do not go into a free trade agreement and expose ourselves to the elements that other countries have built up through subsidies and through long-term industrial policies in their countries and then come knocking at our door and say, “We'd like to have a free trade agreement, remove barriers so we can come in and penetrate an industry that you haven't done a very good job of protecting”.

That is what we are saying here, that it is an industry where Canada has failed to have a proper policy. I guess the government's budget is a good example of that. There is reference made to shipbuilding and the importance of shipbuilding in the decline, but then where is the response? The response is to say, as the government whip said, “We've got all this work on our books but we're not going to do it. We're not going to do it in this budget”. We have an economic stimulus budget that is being bragged about as the greatest level of stimulation to be put into the economy in decades, but what is there for shipbuilding?

Out of the $64 billion deficit that the government plans to run in the next two years there is $175 million allocated for shipbuilding. That is not enough.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:15 p.m.

NDP

John Rafferty Thunder Bay—Rainy River, ON

Mr. Speaker, I certainly appreciate the member's comments and certainly the minister's comments just before that. I invite him to come to Thunder Bay to see our shipbuilding facilities where not one ship is being built at this moment and not one ship was built last year. I invite him to come and I will personally show him around. The government mentioned that extending tariffs for some vessels for up to 15 years was an important part of EFTA. Without any other measures, is this not simply a stay of execution for the shipbuilding industry?

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:15 p.m.

NDP

Jack Harris St. John's East, NL

Mr. Speaker, surely, this is all it is doing. It is saying this is okay because it is stretched out over 15 years. Somehow or other the industry is supposed to respond to this on its own while we are competing with an industry that has been built up, supported, developed, subsidized, and nurtured by a government such as Norway, a country with one-third of the population of Canada but that has done a very good job of managing its internal resources, looking after its people, and making sure that when it develops an industry it is an industry that can compete in the world.

We have for example Norse Hydro which is participating in the offshore of Newfoundland and Labrador to a greater extent, through Statoil Hydro which is participating in the offshore of Newfoundland and Labrador with 12% of one project and 18% of another. They are active players in our offshore as a government agency. Norway has done this kind of work in ensuring that it is an international player in shipbuilding, in aquaculture, in salmon marketing, and all sorts of industries that it nurtured and developed. Shipbuilding is one of them.

We have to do the same if we hope to compete. Just sort of staging a withdrawal or staging out tariffs is essentially a staged withdrawal from being a competitive player, if one does not do the work on the ground to make it happen.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:15 p.m.

Carleton—Mississippi Mills
Ontario

Conservative

Gordon O'Connor Minister of State and Chief Government Whip

Mr. Speaker, I want to explain budgeting very quickly. Starting in 2006, and through 2007 and 2008 our government committed billions and billions into the shipyards. They may not show up in this budget, all these billions, but they have been committed by the government. Therefore, all those DND projects are there. The money is there and it will be spent. It just does not show up in this budget. The member has to go back and do the research.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:20 p.m.

NDP

Jack Harris St. John's East, NL

Mr. Speaker, I appreciate the explanation of the government whip, but we have had the same experience with the infrastructure funds where there are billions of dollars on the books but they are not being spent, so what good does it actually do? I thank him for his comments, but we will be looking actively for that money being spent.

I see the $175 million in this budget for the 98 vessels on a cash basis, and perhaps the member can explain to me whether I am right in assuming that a cash basis means that if we do not spend it in this budget year, then it is not on the books, that it is gone and it will not be spent. I think I am right in saying that, but if the member is right when he says that other projects are on the books, then we look forward to his government making an announcement as to when the joint supply ships will be constructed, and when that tender will go out again so we can see some action on it.

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:20 p.m.

NDP

Brian Masse Windsor West, ON

Mr. Speaker, I am glad to rise to debate this issue. It is very important, especially given the fact that as we look at another trade agreement we have our current agreements that are not being complied with. We have seen this government capitulate with regard to softwood lumber. There, we were able to pull a defeat from the jaws of victory. We had won the court cases and had the victory through the dispute resolution process, but we decided instead to settle for defeat.

The consequence of that, as we have heard from the member for Thunder Bay—Rainy River, is that the industry has basically become a net exporter of raw resources and has a diminished capacity for secondary post-production, which is the real value of some of the skill set training and knowledge of Canadian workers. That is important to recognize because we further undermine our ability to protect this country and also prosper by becoming a net exporter of resources.

This Parliament is moving forward rather quickly with regard to a trade agreement with European trade partners. We have been neglecting the United States file, as the Americans have put a buy American caveat in their legislation for their stimulus package. That has led to quite a bit of confusion right now and the government in question so far has stated only that it would monitor the situation and talk to people.

Yet, it has not set up a plan B. Unfortunately, a plan B is very important. Even if the government did not want to move on that particular issue right away, there should be work and at least the admittance to do that because we are not taking advantage of opportunities. There are classic examples of this.

This trade agreement is tied to the stimulus package in the sense that it is an opportunity to be able to do new and exciting things. Even if one took the minister's words to heart regarding our over-capacity, we have heard counter-evidence to that effect. The member for Thunder Bay—Rainy River has invited the minister to come up to his riding to see where ships used to be built. Even if we were at the point where we had 10 years of work, as the government chief whip said, there is nothing stopping us from increasing capacity here and developing it further.

That is important to note because it is all well within our rights, especially when we look at the current trade agreements and the fact that we are partners with the United States. A lot of the American defence procurement is done in a way that protects its workers and also its national interests by making sure its defence capabilities and manufacturing base is there. Some of the technological advancements, through many of these procurements, are very beneficial to other parts of the economy, not just the workers who are doing the work on the line or in the research and development phases, but also as it spins off into other technologies and other uses of new goods and services including materials that make up everything from computers and electronics to new types of construction elements that can be applied quite often in a civil society.

When we look at the Canadian side, we do not believe it is okay for Canada to sit back and depend upon others to manufacture some of our most important aspects to make sure we have a safe, sovereign country. The most recent glaring example has been the Navistar truck plant in Chatham, Ontario, which could have been retooled to produce a truck for our military. Instead, we are sending a quarter of a billion dollars of money down to Texas so that the Navistar facility there will have the jobs. It will have the advancement of the technology as the trucks are improved. It will also secure a number of different contracts in the future. Here, we are vulnerable to seeing our plant, which is already at a diminished capacity, firing hundreds of people and leaving for Mexico. That is sad.

We have heard the argument that we cannot do anything about it. That is absolutely nonsense and it is not true. We can have that procurement under the current trade relationship we have. No one would place blame, just like we do not blame the United States if it has particular aircraft or different types of military elements that it wants to ensure it has in its actual custody. Then, I could understand the argument regarding national security. The Americans would at least have the basis for that. We could engage them in a wider attempt to open up both of our nations for a fairer policy. However, we do not challenge that. We just surrender and run up the white flag.

Lately we have Canadians whose jobs we saved just a few years ago. The Liberals at that time said they could not do anything for Navistar in terms of retooling and training to produce a new vehicle because it would violate NAFTA and be against all the rules. There were a whole bunch of lies and misconceptions.

The government finally capitulated and a small investment went into that facility. The men and women of the Chatham and greater southern Ontario area benefited, and they paid it back into the coffers of this country quite significantly because they paid income tax and made donations to the United Way, making sure their families could stay in the municipalities and that property values did not slide. There was an opportunity for them to feel secure with their families and to send their kids to school to get an education.

Instead, what have we seen? We have seen the government, with one-quarter of a billion dollars, say that Texas can have that, and that by the way there are no rules and nothing to worry about, and that it is just going to sit back on the sidelines.

The sad thing is it is not only the years of lost production and manufacturing and the potential of new contracts that could be won by that type of very modest investment and retooling; on top of that there is the ability of the workers to have self-confidence and of the the community to continue to function in the way it has. The departure from at least engaging in that policy, or at least discussing it, is also leaving out the echo effect that would be quite viable with that type of investment in the Chatham facility. From that we would see the servicing and all the other elements of the trucks that could come from the facility if they wanted to, or we could look at some type arrangement that way.

That is why we are really upset with regard to the potential loss in the shipbuilding industry. It has been noted that Norway has set up a series of investments over a number of years for hard infrastructure that has allowed it to build up its actual capacity. That is fine. It is something Norway decided to do, but it is something we should not ignore. As New Democrats, we are not alone in being concerned about that element and about the reduction of our tariffs over a series of years, which could really undermine our ability. That is what is concerning about it, especially when we look at investors.

If we have so much work, as the minister says, although we have heard evidence counter to that, why would someone want to invest further into this country when there is the competitive advantage in Norway and we would be catching up at this time?

That concern has been expressed by others, even in the private sector. One of them has been Mary Keith, a spokeswoman for Irving Shipbuilding, who said the agreement announced Thursday “is a devastating blow for Canadian shipbuilders and marine service sectors. The Government of Canada is continuing its 12-year history of sacrificing Canadian shipbuilding and ship operators in the establishment of free trade--”

Canada-EFTA Free Trade Agreement Implementation Act
Government Orders

6:25 p.m.

Conservative

The Deputy Speaker Andrew Scheer

Order. The hon. member will have 12 minutes left in his remarks the next time this bill is debated.

The House resumed from January 30 consideration of the motion that this House approves in general the budgetary policy of the government and of the amendment.

Financial Statement of Minister of Finance
The Budget
Government Orders

6:25 p.m.

Conservative

The Deputy Speaker Andrew Scheer

It being 6:30 p.m., the House will now proceed to the taking of the deferred recorded division on the amendment to the ways and means Motion No. 1.

Call in the members.

(The House divided on the amendment, which was agreed to on the following division:)

Vote #2