House of Commons Hansard #94 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was investment.

Topics

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:35 p.m.

NDP

Yvon Godin Acadie—Bathurst, NB

Mr. Speaker, I will be sharing my time with the hon. member for Hamilton Centre.

I am proud of the New Democratic Party motion being debated today in the House of Commons.

The text of the motion calls for improvements by:

(a) making public hearings a mandatory part of foreign investment review; (b) ensuring those hearings are open to all directly affected and expert witnesses they choose to call on their behalf; (c) ensuring all conditions attached to approval of a takeover be made public and be accompanied by equally transparent commitments to monitoring corporate performance on those conditions and appropriate and enforceable penalties for failure to live up to those conditions; (d) clarifying that a goal of the Act is to encourage foreign investment that brings new capital, creates new jobs, transfers new technology to this country, increases Canadian-based research and development, contributes to sustainable economic development and improves the lives of Canadian workers and their communities, and not foreign investment motivated simply by a desire to gain control of a strategic Canadian resource; and that the House express its opposition to the takeover of Potash Corporation by BHP.

I do not see how the government can vote against this motion unless it has something to hide.

While I was listening to the members from Saskatchewan, 1 of the 13 Conservative members from Saskatchewan said they all play a big role and that they talk to people in Saskatchewan, to the government, to the caucus and to the party caucus in Saskatchewan.

I wonder if the threat by the premier of Saskatchewan to take the federal government court played a part in the government's decision yesterday. When the premier of Saskatchewan and his party said that if the government did not give Saskatchewan what belongs to them, which is the potash of Saskatchewan, then they would take the federal government to court, I wonder if that figured into the federal government's decision.

Knowing that there will probably be an election at the beginning of 2011, the government had to wonder what would happen to the 13 Conservative members of Parliament from Saskatchewan if it did not change its decision. Is that what made the government change its decision?

When we talk about foreign companies coming to Canada, we say that we welcome them but, as motion reads, it needs to be good for Canada.

Yesterday, the Minister of Industry said that he looked at this issue and found that it was not good for Canadians, so the government would stop the sale for 30 days. He would not tell us why under the law.

Today we hear that the 13 Conservative members worked so hard that they were the ones who stopped the sale. That is what the government has been telling us all day. It did not tell us that the sale was stopped because it was not a benefit to Canadians.It said that it was stopped because of the 13 Conservative members working so hard because they did not want to lose in an election. Talk about politics, the government is making this political.

We have experience with foreign companies. In 1914, a paper company was built in Bathurst, New Brunswick. In 1989, Stone, a company from the United States, bought it. In 1989, Smurfit, another company from the United States joined with Stone and became Smurfit-Stone.

What did that company give to the people of Canada? What did it give to the people of Bathurst and New Richmond?

Well, not long after that, in 2007, the company decided to close down and go back home to the United States. One of the conditions to buy the pulp and paper mill in Bathurst was that the company could not be in competition with the United States. How can a pulp mill be sold without being competition to a company with a pulp mill?

Today in Bathurst, it is sad to see this mill going down every day. The whole building is being torn down, a building that was built in 1914 and a mill that gave good jobs to the people in Bathurst, New Brunswick. It also gave good jobs to people in New Richmond and in Quebec but they also lost their jobs.

What happened to Bowater when it bought Abitibi in Dalhousie? Abitibi bought it and then Bowater came in and in 2007-08 it decided to close it down. Where is the mill today? The mill is being torn down in the same way the mill in Bathurst, New Brunswick is being torn down.

The only thing foreign companies have done is to walk away from us and people have lost their job. What about Vale Inco, the company from Brazil? The government did not stop that company from coming in. Nothing stopped it from coming in. First, it supposedly had a guarantee for Canadians. Was the only problem in Sudbury the fact that it did not have 13 members from the Conservative Party? Is that the only problem it had in Sudbury? This company came in and it put people on strike and out of work for 10 months. The company took away part of their pension plans and their bonuses and put the workers on the streets.

At the same time, in Voisey's Bay, Newfoundland, the workers are still on strike. That is what foreign companies have done. On top of that, company told the workers they should learn about the type of living in Brazil.

How many times were questions put to the Minister of Industry and he kept defending the company? At the same time, the government was ready to give the company a $1.2 billion loan, a company that put Canadian workers out on the street.

This motion is calling on the government to be open and transparent, which is why the government was elected in 2006. It said that it would be more open and transparent, that it would talk and share decisions with Canadians and that it would not hide.

This motion is all about sharing with the House of Commons and sharing with Canadians. So far we have not seen too many companies that have helped Canadians once they took over a company. They just exploit everything that we have and, once it is time for them to go, they just go.

That is what happened in the forestry industry. I am happy with what the NDP did. After we put pressure on the government, it finally saw the light or was forced to see the light as a result of a threat from the premier of Saskatchewan that it would take the government to court if that company went into Saskatchewan. The government must have felt the threat pretty strongly when it knew that 13 Conservative members of Parliament in Saskatchewan did not stopping the deal. That is what stopped the deal.

However, it should go further than that. That is not what should stop a deal. What should stop a deal is truth and transparency being given to Canadians and a decision being taken on behalf of Canadians. That is what needs to be done.

The Conservatives are telling us that they are a responsible government and they feel the opposition parties are playing politics. If somebody is playing politics, it is the Conservatives. If they are not playing politics and if they believe in transparency, on November 16 when we vote on this motion they should stand and support it.

Outside of that, they have something to hide and that will be sad because we have lost too many companies in our country. We have lost too many jobs and for the people who are working their wages are going down. Too much of that has happened because of foreign companies coming here. We are a country with sovereignty and we could run our own businesses when we look at our natural resources. Very soon we will not own this country anymore because the Conservatives and the Liberals will have given it away to other countries around the world.

I ask this House to support this good motion because it is a good one. The motion did not come just yesterday. In 1985 a motion like this was brought to the House by the hon. Ed Broadbent and the Liberals and Conservatives never supported it. I will be surprised on November 16 if they are here to defend—

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:45 p.m.

Conservative

The Deputy Speaker Andrew Scheer

Questions and comments, the hon. Minister of Canadian Heritage and Official Languages.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:45 p.m.

Port Moody—Westwood—Port Coquitlam
B.C.

Conservative

James Moore Minister of Canadian Heritage and Official Languages

Mr. Speaker, I was having some meetings but I noticed that my hon. colleague, the official languages critic for the NDP, was here in the House to speak in this debate. I just noticed that we have had over the past day and a half very good debates in the House on copyright reform. Different parties have come forward with their views and hopefully that legislation will go to committee.

Obviously, there is plenty of room for discussion and debate with regard to foreign direct investment, the degree to which it is beneficial to Canada and the degree to which the government should or should not respond to the regime in which we approach these considerations, but there is no need to yell and scream and attack people's motives on this issue. There are plenty of examples.

As a matter of fact, the largest employer in the riding of the NDP member for Burnaby—New Westminster is Electronic Arts Sports, an American-owned video game software company that is hiring thousands of his constituents in Burnaby—New Westminster in the video game and software development industry. It is massively profitable. That is a direct example of foreign direct investment into his own riding. That is the largest employer in his riding, with high-paying, high-quality jobs in the tech sector. That is foreign direct investment hiring Canadians.

There are examples, certainly with regard to natural resources in different regions of the country that have different pressures and different dynamics, and members opposite are more than welcome to raise those concerns. We can have a debate about them and that is fine. However, the one thing I wanted to underline is that it is not all bad but it is not all good and the government has a responsibility to make decisions that are in the best interest of Canadians, the net best interest as the legislation describes.

What I wanted to clarify is the member's attack, frankly, on the members of Parliament from Saskatchewan. There are 14 members of Parliament elected from the province of Saskatchewan and 13 of the 14 are Conservatives. It is different when one is on the governing side of the House of Commons. I can say that the members of Parliament who are over here, including you, Mr. Speaker, and I see the member from Saskatoon and others, work incredibly hard, and just because they do not turn red and yell it into a television camera does not mean that they are not working very hard for the people of Saskatchewan. I can say that they are.

This is a very difficult issue and they took their responsibilities seriously to balance the best interests of all of Canada and their constituents, and they did their job.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:50 p.m.

NDP

Yvon Godin Acadie—Bathurst, NB

Mr. Speaker, I am not ashamed of turning red when I believe in something. I am not ashamed of speaking from my heart. Too many workers have lost their jobs because of the previous government and the government of today. The people at Vale Inco did not deserve what they got. The people of UPM in Miramichi, which I did not talk about, did not deserve what they got. After the company bought it in 2000, hundreds of people lost their job.

NDP members welcome foreign companies that create good jobs and respect workers. We have said that all along. When a company comes to Canada, we need to know whether it will be a good corporate company that respects workers and Canadians. This motion is all about being able to study companies and not have backroom deals where Canadians cannot find out what is happening. I hope the Conservatives support it because that is what the Minister of Canadian Heritage and Official Languages was saying.

If it upsets him that I get red and emotional, it is because I also serve people. Even if I am not on the government side, people come to my office with tears in their eyes when they lose their job, their pensions and everything for which they have worked for over 35 years. That is what I am talking about, if he were listening.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:50 p.m.

NDP

Brian Masse Windsor West, ON

Mr. Speaker, it is important to point out the difference between a hostile takeover and investment. NDP members support investment like EA Sports and others that come to mind but this is a hostile takeover.

I would like to ask my colleague a quick question. The government failed to protect the workers of Inco and Falconbridge where the U.S. courts tied up the chance for us to have a great mining Canadian champion. It allowed Vale and Xstrata to come in and basically suck the blood out of the community, especially when we look at Vale, as opposed to creating a corporate champion in Canada. There is a difference between takeovers and investment and that is what the government does not understand.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:50 p.m.

NDP

Yvon Godin Acadie—Bathurst, NB

Mr. Speaker, I agree with the member. How would the country of Brazil feel if Canada were to buy one of its companies and then throw its workers out of a job for ten months? I think it would tell the company where to go.

That is what happened with Vale Inco. It came in under the Conservative government with no protection at all for the workers. The minister had the guts to get up in the House and kept saying that the company promised the government this and it promised it that. Guess what? Vale Inco just asked for $1.2 billion loan when it has people on strike. I bet the government will be ready to give it to the company. That is what we are talking about, protecting the interests of Canadians, and the government is not doing that. That is why this motion is so important. If those members do not vote for it, it is because they want to continue the same trend.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

4:50 p.m.

NDP

David Christopherson Hamilton Centre, ON

Mr. Speaker, I appreciate the opportunity to join in the debate.

Coming from Hamilton, we are dealing with a very different reality than the citizens of Saskatchewan in terms of the Potash Corporation. We were in the overwhelming majority of companies, that category where there was just a rubber stamp and was allowed to go on.

When we look at what the legislation is ultimately supposed to be about, it is about a net benefit to Canada. Last time I checked the map Hamilton was a part of Canada. Therefore, there ought to be a net benefit in the home town of where the plant is.

As of today, we are on the brink of U.S. Steel locking out its employees, the ones who are left after they shut down product and laid off a whole whack of other workers. If it gets what it wants in their negotiation demands, the steelworkers who are currently retired will lose their inflation protection going forward.

That may not seem like an awful lot when we are talking about 1% or 2% inflation, but a lot of us believe, with everything that has gone on in the last few years, there is likely somewhere in the lifetime of those steelworkers going to be a period of inflation. At the end of that, their income is going to be a lot less and their quality of life is going to be a lot less and their net benefit to being a Canadian is going to be less than it was.

Not only that, the company wants to change the collective agreement further so that every employee hired from here on in does not get the same pension benefit as the workers who came even the day before them. In fact, they will not have a pension. They will be caught into this nightmare scenario, which I think is coming for a lot of people who are invested totally with RRSPs. This is not nearly the same as negotiating a defined benefit, so one knows how much money one is going to get every month when one retires, as opposed to down on bended knee praying to the free market gods that one will be lucky enough, when one cashes out, that the market is on an upswing.

That is what the government has done to my constituents, my family members, my friends and my fellow Canadians. Where is the net benefit?

Lest one thinks this is only the NDP members doing the stuff that they do, let us have a look at what the Hamilton Spectator had to say on October 6, just a few weeks ago. It said:

It's instructive to cut through the rhetoric surrounding the shutdown under way at the U.S. Steel Hamilton plant...Essentially, it has become clear that U.S. Steel’s Hamilton plant is not considered a primary site for production. A primary production site does not shut down regularly and have its production shifted to plants in the United States. Call the Hamilton plant a backup location, an overflow operation, whatever. The plant in our city is nowhere near the top of the steel giant’s list of important places....But Canadian government approval of the purchase was contingent on commitments from U.S. Steel on maintaining certain employment and production levels.

It ends with, “U.S. Steel owes it to us”, meaning Hamiltonians, “to fulfill its employment and production commitments. If not, it should be seeking Canadian based buyers for a plant that still has productive life in it”.

Quite frankly, it is anything other than just washing its hands of it, which is what the government is doing. Make no mistake, the minister I believe yesterday, in response to a question from my colleague from Hamilton Mountain, said:

We are the first government in the history of the Investment Canada Act to actually take a company to court to enforce the undertakings that it promised with the government and the people of Canada.

That is interesting.

I will go back to the Hamilton Spectator so it makes it just a little more difficult for the government to say that this is just partisan NDP politics, because it is not. This is about people's lives. What did the Spectator say, on May 8, 2009, about that? It said:

As for the threat of $10,000-a-day fines? That is $3.65 million a year--chump change to U.S. Steel. By comparison, a Dundas optician has been subject to fines of $50,000 a day since November 2006 for operating in violation of Ontario health regulations. If Ottawa is serious about enforcing its foreign investment legislation, it needs to up the penalties considerably.

Ottawa should also change the Investment Canada Act so that future agreements and commitments would be public (with the reasonable exception of sanctions that could put a company at competitive disadvantage.)..U.S. Steel has an obligation to honour its agreement--or explain how and when it can do so. Ottawa has a duty to push for answers..

Where was the government?

The minister was in Hamilton on October 15. This is what he said, and I am quoting from a document they circulated in the Local. He said:

At this point obviously U.S. Steel is beyond the undertakings that it made with the Government of Canada. Those undertakings ended some time ago now, they were for a period of time that has now expired, so they can make decisions, good, bad or indifferent, according to their own timetable and their responsibilities.

Rolf Gerstenberger, the president of USW Local 1005, had something to say about that. I am again quoting from a document they circulated in the Local. He said:

Visiting Hamilton for a funding announcement at McMaster University on October 15, 2010 Industry Minister...made a factually wrong, socially irresponsible and politically stupid statement. Asked about the activities of US Steel about which all of Hamilton is understandable very concerned...

[The industry minister] should know that the 3 year commitment that U.S. Steel made to the Government of Canada is not “beyond the undertaking it made to the government of Canada.” He should know that “those undertaking” DID NOT END “some time ago” but in fact expire on October 31, 2010. [The industry minister] should know that U.S. Steel has yet to recognize its commitments to keep employment at 3,105 workers and production at 4.3 million tons of steel a year and that furthermore it has now shut down the blast furnace at Hamilton Works for a second time and is thereby producing no steel at all.

My contention is there is the evidence that the government has washed its hands of those steelworkers at U.S. Steel and of aluminum workers and of workers all across Canada. The only reason the potash deal was stopped was because there was such an uproar across the province of Saskatchewan that it had no choice.

Had the government put the interest of steelworkers first, had it put the interests of the Canadian steel industry first and had it put the interest and net benefit of Canadians first, it would have also turned down the U.S. Steel deal because it was just as bad for the workers.

What we are trying to do with this legislation is really not that radical. It is to throw some light on the situation and say that these deals happening in the background cannot go on. We are saying a number of things, but these are the main ones. There ought to be some public acknowledgement, some public involvement. Perhaps there ought to be some public negotiations. However, the government cannot just wash its hands based on the Holy Grail of the market, which it has now shown to be a rather elusive goal.

I hope, at the end of the day, when all the yelling, mine and everyone else's, on behalf of people who are being hurt, who are not getting any net benefit, we will finally have a Parliament that is prepared to come head-to-head and properly put rules and protection in place for workers and the communities in which they live. Without that, we will be back here over and over again trying to defend job by job.

It would just be so much easier if we had a government that believed that the interests of those working people and the net benefit of Canadians really was the top priority rather than the almighty buck, which always comes first with this government.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

5 p.m.

NDP

Brian Masse Windsor West, ON

Mr. Speaker, I congratulate my colleague on a very good speech detailing the issues around U.S. Steel and the effects on workers.

One of the more interesting things we have had take place during this debate, and I agree with my colleague's assessment, is that if it were not for the good people of Saskatchewan and Canadians from across this country pushing the potash issue, there is no way the government would have turned away from this actual deal. This is one of the reasons I think the minister is now using the language of “interim” decision.

The member has pointed out quite correctly that the Liberals never had a case turned down on their watch.

They turned down MacDonald, Dettwiler and Associates, thanks to the good work of Peggy Nash.

One of the other interesting things is that the minister has been bragging that he is taking U.S. Steel to court. When we back this up, it is rather odd. U.S. Steel comes in and the minister sits down with U.S. Steel and decides that this will be a good business partner for them, sets out the terms and conditions for their partner, and their partner basically backhands them at the expense of Canadian families and workers, and he is bragging about how he is taking U.S. Steel to court.

It is unbelievably ignorant and absolutely arrogant of the minister. How does it help the workers and the people of Hamilton, just because the Conservatives are having to take their business partner to court?

I would like my colleague to answer that question, because I cannot understand. If individuals do not have a job, they are sitting at home. They have paid into their pension. They have paid to the United Way and have done all their good diligence over the years as good, hard workers to be productive, and because the company uses us as a branch plant and shuts down operations to feed its Americans, just because the government is taking the company to court, they should be grateful.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

5:05 p.m.

NDP

David Christopherson Hamilton Centre, ON

Mr. Speaker, I thank my colleague for his observations.

I think it is interesting that the Hamilton Spectator took exactly the same position. A fine of a few million dollars to a multinational corporation such as U.S. Steel is nothing really more than just a licensing fee to do business.

They think that somehow steelworkers will take comfort, that those who are already thrown out of work and those who may be forced out of work will feel comfortable because the Minister of Industry is taking the company to court for a fine of a few million dollars, which probably covers a couple of weeks of operation costs at a plant that size, certainly in terms of their whole organization.

That is not what we want. What we really want at the end of the day is a government that deals with this at the front end. Once we are at the back end dealing with penalties and punishment, we have already lost. What we need is deals up front and deals that make sense for Canadians.

The government member who spoke tried to say that we do not support any foreign takeovers. I know for a fact my colleague was on his feet just a while ago reading a list of them. No, there is not a great big long list, because quite frankly, most of them are not very good for the people of Canada, and we just wish the Conservative government would act in the same vein.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

5:05 p.m.

Bloc

Serge Cardin Sherbrooke, QC

Mr. Speaker, it will be difficult to cut a 20-minute speech down to 6 or 7 minutes, but I believe it is important for me to address the House, even if I only have a few minutes left.

We all know that PotashCorp owns 20% of the world's potash reserves. Potash is a rare mineral used to make fertilizer. We all saw what happened in mid-August when there was a hostile takeover bid and an outcry against it because BHP Billiton was offering $28.5 billion, or $130 per share. The day after the bid, the President and CEO of PotashCorp, Bill Doyle, more or less called the deal an attempt to steal the company. However, he also quickly stated that he was not saying that the company is opposed to the sale, but that it is opposed to “a steal” of the company.

We can see what is happening. Shareholders and owners of a very important company are not bothered by the fact that they are permitting a Canadian company to be taken over by foreign interests, but more so by the fact that they will have less money in their pockets. With the 30-day deadline, the government has the opportunity to jump up and purchase the company for less than it is worth. We must consider that the share price was $250 two years ago, before the recession. There may be hope yet for Billiton.

Today, shares are trading at around $145, which is more than the $130 per share offered by Billiton. Furthermore, this will obviously depress share prices, probably for a number of years. From a financial standpoint, Saskatchewan is afraid that it will lose up to $3 billion per year if PotashCorp is sold to foreign interests. In response, BHP offered to compensate Saskatchewan with a $370 million payment into a future infrastructure fund, which the provincial government rejected as being completely inadequate to offset the loss.

Even the Prime Minister indicated that he was not uncomfortable with a foreign takeover of PotashCorp. The government is rather dogged in its determination. Earlier, I mentioned a 30-day period. This will allow the government to quickly rebound.

The NDP motion is very clear. It would amend the act “to ensure the views of those most directly affected by any takeover are considered, and any decision on whether a takeover delivers a 'net benefit' to Canada is transparent”.

The first part of the motion would make “public hearings a mandatory part of foreign investment review”. I should point out that the second paragraph of section 4 of the Investment Canada Act already enables the Minister of Industry to consult with industry and labour stakeholders.

However, such consultations are voluntary, not mandatory. Also, there is nothing to state that these consultations must be public. The Conservative government loves voluntary elements. That is what it is doing with the census.

In exercising his or her powers, the minister may, if the situation calls for it—again, this is not an obligation, but the motion would make it obligatory—hold consultations by organizing conferences and meetings. With this government, everything is “may”, “maybe” or “possibly”, but this motion would make these things mandatory.

The Bloc Québécois does not believe that the government's approach to investment in Canada is the best possible approach. When discussing the Investment Canada Act, we have to keep in mind the 2009 Budget Implementation Act, which allows the government to issue an order raising the minimum threshold for automatic review of a foreign investment in Canada set out in the Investment Canada Act.

That threshold could gradually increase from the current $300 million to $600 million in one year, $800 million for the following two years and $1 billion for the years after that. Some very important players in Canada's and Quebec's economies, such as Nortel and aluminum producer Alcan, which is now just a subsidiary of giant Rio Tinto, have already been transferred into foreign hands.

Foreign investors benefit from a favourable conflict resolution system internationally. A $1 billion threshold could result in many leading lights of the Quebec economy passing into foreign hands without the government ever having the opportunity to assess whether such takeovers are good for local economies. As such, the Bloc Québécois demands that these provisions be scrapped and that the threshold for review be set at $300 million.

Opposition Motion--Foreign Takeovers
Business of Supply
Government Orders

5:15 p.m.

Conservative

The Deputy Speaker Andrew Scheer

It being 5:15 p.m., pursuant to an order made earlier today all questions necessary to dispose of the opposition motion are deemed put and a recorded division deemed requested and deferred until Tuesday, November 16, 2010, at the expiry of the time provided for government orders.

The House resumed from November 3, consideration of the motion that Bill C-47, A second Act to implement certain provisions of the budget tabled in Parliament on March 4, 2010 and other measures, be read the second time and referred to a committee.

Sustaining Canada's Economic Recovery Act
Government Orders

5:15 p.m.

Conservative

The Deputy Speaker Andrew Scheer

The House will now proceed to the taking of the deferred recorded division at second reading stage of Bill C-47. Call in the members.

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

Vote #126

Sustaining Canada's Economic Recovery Act
Government Orders

5:55 p.m.

Liberal

The Speaker Peter Milliken

I declare the motion carried. Accordingly, the bill stands referred to the Standing Committee on Finance.

(Bill read the second time and referred to a committee)