Bill C-19 (Historical)

An Act to amend the Competition Act and to make consequential amendments to other Acts

This enactment amends the Competition Act and includes the introduction of an administrative monetary penalty in respect of cases of abuse of dominant position, an increase in the amount of administrative monetary penalties in respect of deceptive marketing cases and the repeal of all airline industry specific provisions and criminal provisions dealing with price discrimination, predatory pricing, discriminatory promotional allowances and geographic price discrimination. This enactment also provides that the court may make an order in respect of cases of false or misleading representations to require the person who engaged in the reviewable conduct to compensate persons affected by the conduct and issue an interim injunction order to freeze assets where the Commissioner of Competition intends to ask for that order. This enactment also provides for consequential amendments to other Acts.

Competition Act

[France Bonsant, Bloc, Compton—Stanstead, QC]

Mr. Speaker, I am pleased to speak today in the House on Bill C-452, An Act to amend the Competition Act (inquiry into industry sector) introduced by my colleague from Shefford.

Bill C-452 proposes to amend the Competition Act to give more power to the Competition Bureau. I would like to start by congratulating my colleague for this fine and very important private member’s bill. I think this is a subject that is dear to his heart and I want to salute the quality of the work he has done.

The amendment proposed by my colleague from Shefford will allow the Commissioner of Competition to initiate inquiries of his own accord into fluctuations in the price of gasoline, if there are reasonable grounds for doing so. It will therefore no longer be necessary to wait for complaints to be filed before making an inquiry. If this bill is enacted, the Competition Bureau will be better equipped to combat companies that might profit from their dominant market position to pick consumers’ pockets.

Every time gas prices rise, the governments hands us the same answer: nothing can be done, the Competition Bureau has concluded there was no agreement among the oil companies to fix prices. The truth is that there are a number of flaws in the present act. It does not allow the Competition Bureau to initiate inquiries. And when there is an inquiry, the Competition Bureau cannot really do anything with them because at present it cannot compel the production of documents or protect witnesses. Bill C-452 would eliminate these flaws by allowing the Bureau to initiate inquiries and allowing the federal Trade Tribunal to protect witnesses and seize relevant documents.

If the act is not amended, gas prices will continue to fluctuate with no justification, as is the case at present. And it will again, and still, be consumers who will continue to pay for the more dubious practices on the part of the oil companies.

Gas prices fluctuating is one thing. It is another thing when they rise stealthily and without justification. Recently, prices at the pump rose because of the political instability in north Africa. In just a few hours, prices rose spectacularly. That is completely bizarre, when we know that the events that occurred in north Africa had at that point not yet had any impact on the cost of refined gasoline that was already in Quebec. That practice is nothing more nor less than a way of making even more money on the backs of consumers, and there is a lot. It is estimated that because of collusion, retailers have overcharged Quebec consumers by as much as $100 million.

The Bloc Québécois recently supported Bill C-14, An Act to amend the Electricity and Gas Inspection Act and the Weights and Measures Act, to fix price errors at the pump. But that bill does not solve the problems of collusion like the ones recently disclosed in Quebec and does not prevent sudden increases in the price of gas. The Conservative government claims that its initiative will save the public a lot of money. Gas consumption in Canada, calculated over a full year, is so high that it is completely foolish to think that bill can have any impact on consumers’ wallets. That is why we in the Bloc Québécois believe that in order to respond effectively to gas price increases, Bill C-452 must be enacted. This bill is the only thing that will have a real impact on prices at the pump.

For years, the Bloc Québécois has been pressuring the federal government to finally take action to address the rising cost of petroleum products. It has dogged the Liberal government of the day so that it would follow up on the recommendations made in 2003 by the Standing Committee on Industry, Science and Technology. In October 2005, just before the election, the federal government finally listened to the Bloc Québécois' arguments and decided to amend the Competition Act through Bill C-19. That legislation broadened the Competition Bureau's authority to investigate and increased the maximum penalty for conspiracy. However, Bill C-19 did not follow up on all the committee's recommendations. As we know, that legislation, which was only an election ploy, died on the order paper with the election call, and we certainly could not count on the Conservative government to bring it back.

In 2007, the Bloc Québécois introduced Bill C-454, which also died on the order paper, when the election of 2008 was called.

In 2009, the Conservatives took part of the bill and included it in the budget implementation act. However, they did not see fit to allow the Competition Bureau to initiate investigations. That is why the hon. member for Shefford came back again with Bill C-452. The recent years clearly show that neither the Conservatives, nor the Liberals acted to protect consumers. By contrast, the Bloc Québécois is taking action.

For the Bloc Québécois, the only effective way to deal with the rising cost of gas is to use a global strategy. That strategy is three-pronged: to bring the industry into line, to make it contribute, and to reduce our dependency on oil.

First, we must bring the oil industry into line. The initiative of my colleague for Shefford supports that approach. It is also necessary to set up a true monitoring agency for the oil sector.

Second, the oil industry must make a contribution. With the increase of costs and oil company profits, it is important that the latter pay their fair share of taxes. How can we accept that consumers are getting poorer, while oil companies are getting richer?

Despite the recent recession and despite the rise in the price of gas, oil companies are posting record sales. In 1995, the Canadian oil and gas sector posted combined sales of $25 billion. By 2008, this figure had climbed to $148 billion. That is an increase of nearly 600%.

Now let us talk about profits. In 2003, Canada's oil sector made $17.6 billion in profits. In 2008, it made $79 billion. In other words, the net profits of Canada's oil sector more than quadrupled in just five years. The Bloc members feel that the party must end for the oil companies.

But obviously the Conservatives do not feel that way. In 2003, they supported the Liberal government's move to reduce the overall tax rate for oil companies from 28% to 21%. With the changes brought in by the Liberals, supported by the Conservatives, taxes for Canada's oil sector became more advantageous than in Texas.

But that is not enough. In 2007, in their economic statement, the Conservatives introduced tax cuts for oil companies that would see their tax rates drop to 15% in 2012. These tax cuts will enable the oil companies to pocket approximately $3.6 billion in 2012. These figures make it clear that the federal government chooses to give priority to the interests of the oil companies, at the expense of consumers.

I do not know how the Conservative members justify this to their constituents, but I know that when I meet my constituents from Compton—Stanstead, not a single one tells me that the gifts to the oil companies are justified. On the contrary, the people I meet feel cheated by this Conservative government, a government that is in league with an industry that exploits consumers' dependence on oil.

The third component of the approach proposed by the Bloc Québécois has to do with reducing consumers' dependence on oil. This makes sense and it is perfectly in line with Quebec's efforts to fight global warming. The less gas that we consume, the less money the industry will pocket and the better off our planet will be.

Fairness at the Pumps Act

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, it is my turn so speak to Bill C-14, An Act to amend the Electricity and Gas Inspection Act and the Weights and Measures Act.

Bill C-14 is not bad in itself because it is very important for pump measurements to be accurate. I have noted, though, the criticisms voiced by my colleagues. They said that consumers should not have to bear the cost of the new monitoring requirements under Bill C-14. We will have to be careful in committee to fully clarify this issue.

The Bloc Québécois is in favour of sending the bill to committee. However, the bill does nothing to address the real concern of people, which is that they pay too much for gasoline. Two things need to be done: we have to create an agency to monitor gasoline prices and to give the Competition Act more bite.

The Bloc Québécois has introduced some bills in this regard that I will discuss in a few moments. That is what we need to talk about. I hope the government is not going to pat itself on the back, claiming that it introduced a bill to regulate the fluctuations in the price of gasoline and it will ensure that people pay a fair price through tighter monitoring of the measurement devices at the pump. The accuracy of these measurements is a very interesting point.

We do not even know if consumers benefit or are penalized when pumps are not working quite right. I suppose that if people are tampering with the pumps, it is not to do consumers any favours. It remains to be seen, though, whether people have fiddled with the gauge showing the number of litres pumped. That is not the solution, and I will show why in the next few minutes.

Bill C-14 amends certain provisions of the Electricity and Gas Inspection Act and the Weights and Measures Act in order to better protect consumers against inaccurate gasoline pump measurements. That is basically what we are talking about. Many people are concerned about this. The bill covers other measurement devices as well and not just gasoline pumps.

The bill imposes penalties for contraventions to the laws in question, increases maximum fines for offences, and introduces a new fine for repeat offenders. It also introduced mandatory frequencies for measuring devices and proposes the appointment of non-government inspectors, to be trained and certified by Measurement Canada to conduct mandatory measuring device inspections.

The Bloc Québécois is in favour of Bill C-14 in principle and of sending it to committee.

However, Bill C-14 does not directly address the issue of collusion that has recently come to light in Quebec. Nor does it effectively prevent sudden increases in gas prices. I spoke about two objectives earlier: creating an agency to monitor gasoline prices and giving the Competition Act more teeth.

I want to talk about what happened in my own municipality. Many vehicles are stolen and many people are in possession of stolen vehicles in central Quebec. I do not want people to think that my region is particularly problematic, but in Victoriaville we also had the infamous gas price cartel. Luckily, the scheme was uncovered and people are being held accountable. I hope that if this happens elsewhere in Canada, we will be able to stop them.

However, under current legislation, criticism or complaints must be filed in order for the Competition Bureau to act. That is the difference. The Competition Bureau needs to have quasi-police authority to act when it feels the need and as soon as there are suspicions, not only when there is a complaint. I will come back to that.

We also believe that we still need to make an effort to efficiently respond to rising gas prices, and we can do so with our bill, Bill C-452, which the NDP member mentioned during questions and comments. That bill was introduced by my colleague from Shefford. The Competition Act does not allow the Competition Bureau to conduct inquiries on its own initiative. It must always wait for a private complaint before it can start an inquiry. We are also calling for a petroleum agency to closely monitor gasoline prices and to respond to any attempts at collusion or unjustified price hikes.

If the government had taken a serious approach to really helping consumers, it would have focused on those two points. Every time the price of gasoline rises suddenly, people begin to wonder about the oil industry, and rightfully so. These increases are unjustified, and consumers must not be the victims of dubious business practices on the part of oil companies. I repeat, the existing Competition Act has significant gaps. For instance, it does not allow the Competition Bureau to undertake a real investigation of an industrial sector. How can it gather information if it can neither force the disclosure of documents nor protect witnesses? This aspect must be corrected.

Bill C-452 introduced by the Bloc Québécois would toughen up the Competition Act to give the federal trade tribunal the right to initiate an investigation, rather than waiting for complaints or accusations, the right to protect witnesses and the right to conduct searches and seize documents. A petition to that effect has been circulating. It is a very popular petition, particularly in my region, understandably, since it was seriously affected by this cartel. To ensure that everyone clearly understands the importance of this issue, I would like to read the petition.

WHEREAS:

1. Individuals and companies pled guilty in the summer of 2008 to conspiring to fix the price of gasoline;

2. According to Le Soleil, retailers could be overcharging by more than $100 million a year;

3. The current Competition Act has significant gaps, preventing the Competition Bureau from conducting investigations until complaints are lodged.

THEREFORE, your petitioners call upon the House of Commons to pass Bill C-452, An Act to amend the Competition Act (inquiry into industry sector), authorizing the Commissioner of Competition to conduct an inquiry of her own accord into the fluctuating price of gasoline.

I can say that this petition is very popular. People are requesting it. They get it online and sign it. People want something to be done about what happened. The Competition Bureau did manage to take action in my region. It is so difficult to do anything about this that this was only the second time the Competition Bureau was able to take action in this type of incident. The first time was in Vancouver in 1995. The second time was in 2008 because there was a complaint. We should not have to wait for a complaint before something can be done. Nonetheless, it worked out and that is how it should be, with increased powers and investigations before things get to the complaint stage.

The Competition Bureau discovered a gasoline cartel in Quebec. By cartel we mean an agreement between companies not to compete with one another. It is a rather simple definition. I will read from a Competition Bureau document, a press release that was issued on June 12, 2008:

...the Competition Bureau became aware of allegations of price-fixing at gas stations in Victoriaville, Quebec. The evidence gathered during the Victoriaville investigation led to further probes in other local markets in Quebec, namely Thetford Mines, Sherbrooke and Magog.

In conducting its investigation, the Bureau uncovered evidence of agreements between competitors to fix the price at the pump at which gasoline was sold to consumers. The evidence indicated that participants in the targeted markets carried out the conspiracy mainly by phoning each other to agree on the price of gasoline and about the timing of price increases, contrary to section 45 of the Competition Act.

A number of investigative tools were used, including wiretaps, searches and the Competition Bureau’s Immunity Program.

Some could dispute my argument since I was saying earlier that the Competition Bureau did not have enough room to manoeuvre. Some might say there was collusion, and that a cartel formed in Victoriaville, Thetford Mines, Sherbrooke, and Magog and perhaps elsewhere, but there have been no reports of this in other places.

The competition bureau was able to take action. Lawsuits were filed and some people have already pleaded guilty. So, it works. However, as I keep saying, it took a complaint. At one point, a gasoline retailer from the Victoriaville area received threats, seemingly from other retailers, because he did not want to go along with their scheme. He would keep his prices a little lower than those of the others for a while. His company supported him for a while. However, he eventually found himself all alone and he decided to expose this situation. If I am not mistaken, he talked to a local weekly newspaper. He expressed his frustration to a journalist regarding these events, the threats he had received and the fact that, as a merchant, he wanted to continue to be able to compete with the others.

That is what is wrong with the petroleum industry. If someone wants to buy a pair of shoes, he can go to two or three different stores. Chances are the price of a pair of shoes of the same brand and colour will not be the same everywhere. There may be a $5 or $10 difference. The person may even find a pair on sale, at 50% off the regular price if he is lucky. However, when it comes to gasoline, even if we look everywhere, we will rarely find much variation in prices. In the case that took place in my community, the competition bureau showed that retailers would phone each other and set prices. So, obviously, prices were the same everywhere.

That individual decided that enough was enough, and he spoke out about it. It is only when the competition bureau saw what was going on that it could take action. It reasoned that since a complaint had been filed, it could take action. Otherwise, it could not have done anything. That is why the procedure at the competition bureau must change.

As I said, a number of charges were laid. In Victoriaville, 11 companies were involved in the scheme. In Thetford Mines there were 6. In Sherbrooke there were 20, and in Magog there were 5.

As I mentioned earlier, several companies in Victoriaville, Thetford Mines and Sherbrooke pleaded guilty. The fines are rather stiff, that is $179,000 in one case, $1,850,000 for an oil company, and $600,000 and $90,000 respectively for two other companies. That is more than a slap on the wrist. The $1,850,000 fine was imposed on an oil company, not on a retailer. There is no doubt that these penalties will have a sobering effect.

Obviously, I travel a lot, like all of my colleagues here. We all travel within our ridings. When we are responsible for files, we deal with them away from here, which allows us to compare gas prices. It is interesting to note that at one time in Victoriaville, gas was always slightly more expensive than in Trois-Rivières or Drummondville. Sometimes it was less expensive than in Quebec City, but it was not the cheapest in the province, far from it. Since the Competition Bureau started its inquiry and the results came out, it is funny, but the prices are often lower. People had to be caught red-handed for others to be far more careful in terms of fixing prices. We are still the ones who are benefiting today. Luckily, the Competition Bureau's inquiry allowed us to find out what was going on.

As for the individuals linked to this collusion, this cartel, there were fines of $50,000, $10,000 and $5,000. For once, we caught the people and were able to make them pay. I have here a series of fines for $10,000, $20,000 and $25,000, depending on the person's involvement in the scheme.

As for how this all played out, an article in La Tribune says that the gas cartel may have cost each car owner up to $180. This whole story came to light in 2008, but prices were fixed between 2002 and 2006. The newspaper article says:

A very rough estimate [because it is difficult to know how much gas each person bought over the years] is that each year a car owner in Sherbrooke, Magog, Thetford Mines and Victoriaville paid an extra $20 to $40 to fill up their vehicle because of the cartel, which distorted gas prices for approximately four and a half years.

It is interesting to note that a class action lawsuit against the gas cartel is now before the civil division of the Quebec Superior Court, which will attempt to determine how much money should be given back to people who were swindled for four and a half years.

To date, over 12,000 people—and that number is a few months old—have signed on to the class action lawsuit authorized by Quebec Superior Court Justice Dominique Bélanger on November 30, 2010, concerning gas price fixing between January 1, 2002, and June 30, 2006, in the aforementioned cities.

According to another interesting article, this time in Le Soleil:

Plaintiffs are seeking $7.5 million plus interest as of January 1, 2002. In addition, they are seeking $500 for trouble and inconvenience for each participant in the lawsuit, as well as $1,000 in punitive damages. The Automobile Protection Association is also seeking $250,000.

That should give a sense of the amounts of money sought by this class action. It is important to note that Bill C-14 does not address these concerns at all. Conservative members should not be saying that this bill will solve all gas price fixing problems. The bill might make retailers more accountable by imposing regular mandatory inspections of measuring devices, such as gas pumps, but it will not prevent the price of gas from going up right before a long weekend for who knows what reason.

I have said this a number of times in the House and I will say it again: every time I see gas prices jump and watch television reports about it, I am always curious about what could possibly have caused gas prices to jump by 5¢, 10¢ or 12¢ per litre.

When a representative of the association of oil companies explains on television that there is a problem in Iraq or an oil rig leak, it is always rather difficult to believe him. In many cases, the facts show that the price of a barrel of oil, given that we have reserves, was a certain amount when the problem occurred. As this amount has still not gone up, the price hike should come later, but that is not what happens. As soon as a problem is announced—and we never know if it is real—the price at the pump goes up right away and never goes down as quickly as it should. Thus, we have reason to wonder.

Getting back to Bill C-14, the fines that the courts could impose pursuant to the Weights and Measures Act would increase from $1,000 to $10,000 for minor offences, and from $5,000 to $25,000 for major offences. In the case of subsequent offences, a new maximum fine of $50,000 and/or imprisonment for a term not exceeding two years could be imposed. I would be surprised to see that happen.

There are some measures like this in Bill C-14 but, I repeat, that is not what consumers asked for initially.

The member for Westmount—Ville-Marie even said that the Liberal Party, in 2005, had introduced Bill C-19. There again, the recommendations of the Standing Committee on Industry, Science and Technology, which called for the creation of a gasoline price monitoring agency and more teeth for the Competition Act, were ignored. These two objectives were not achieved by the previous Liberal government, nor by the Conservative government. It is our responsibility to tackle this issue immediately.

Competition Act (Inquiry into Industry Sector)

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Madam Speaker, it is a pleasure for me to rise today on Bill C-452. I want to congratulate my colleague, the hon. member for Shefford, for having introduced this bill to strengthen the Competition Bureau’s ability to make inquiries. We also hope that some parts of this legislation will find their way into government bill C-14 on electricity and gas inspection and on the Weights and Measures Act.

I had an opportunity earlier this week to speak on Bill C-14, and it is good that we are now going to discuss Bill C-452, which is still necessary in our view. We need to continue our efforts to deal effectively with the problem posed by the Competition Act, which still does not allow the Competition Bureau to conduct inquiries on its own initiative. It is still necessary, unfortunately, to wait for a complaint from some individual before an inquiry can be initiated.

Even though the Bloc Québécois supports Bill C-14 in principle, it is not an end in itself. With the introduction of Bill C-452, the Bloc Québécois reiterates its intention of freeing Quebec from its dependence on oil through a bold program focused on green energy and the electric car.

To do this, Bill C-452 expands on the measures the government is introducing in Bill C-14 by proposing further steps that could be taken to protect consumers.

Our bill would give the Competition Bureau the power to conduct on its own initiative real inquiries into an industry if there are reasonable grounds for doing so. At present, this is not permitted. The Bureau has to wait for complaints or for instructions from the minister before it can act.

Even though the government says it took action to correct the situation in the Budget Implementation Act of January 2009, there are no provisions in this act allowing the Competition Bureau to make inquiries on its own initiative. A complaint is still needed before an inquiry can be launched.

It is obvious that a bill like this would leave the Competition Bureau much better equipped to fight companies that want to take advantage of their dominant position in the market to fleece consumers.

The Bloc Québécois is not inventing anything new here. We have simply repeated for several years now the recommendations in the report of the Standing Committee on Industry, Science and Technology, which was tabled in November 2003. The federal government has never done anything to help consumers in this regard. It has a fine opportunity here, though, to set up a monitoring system for the petroleum industry.

To understand the steps leading to the debate on Bill C-452, we need to go into the history of it.

In 2003, the Standing Committee on Industry, Science and Technology tabled a study on the price of gasoline that made two recommendations to the government: create a petroleum monitoring agency and tighten up the Competition Act. The committee even specified the changes to the Competition Act that it would like to see. At the time, the Bloc was already saying that the government should implement the committee’s recommendations.

In October 2005, the Liberal government came around to the Bloc’s arguments and, as part of its plan to help curb the increase in the price of gas, it tabled amendments to the Competition Act in Bill C-19.

Unfortunately, Bill C-19 was just an election gimmick to give the impression the government was doing something to discipline the oil industry and it died on the order paper.

The Conservatives are quite enamoured of the oil industry, of course, and it is hardly surprising that they did not re-introduce the bill.

As a result, in 2007 the Bloc Québécois tabled Bill C-454, which passed second reading on April 28, 2008. But it too died on the order paper when an election was called in 2008.

In 2009, the Conservative government partly revived Bill C-454 in the Budget Implementation Act of January 27, 2009, although the Competition Bureau still was not allowed to launch inquiries on its initiative.

So here we are seven years later debating Bill C-452 to give the Competition Bureau some real teeth.

There is no doubt, in the Bloc’s view, that the Competition Bureau should have greater freedom of action and more discretionary power over its inquiries. To conduct an inquiry, the Competition Bureau needs access to all the documents so that it can do a good job of investigating and promoting competition.

The Bloc Québécois has long been pressing the government to take action in view of the rising price of petroleum products. Bill C-452 is just a first step toward countering the increase in the price of gas.

Apart from Bill C-452, the Bloc is more convinced than ever that the industry should do its fair share.

As I said at the beginning of my speech, Bill C-452 is part of a plan for sweeping change.

First, we must put a stop to the tax cuts for oil companies. In 2007 or just one year after taking power, the Conservative government gave the oil companies another tax cut in the 2007 economic update. As a result, the companies will see their tax rate fall to 15% in 2012. In that year alone, this tax break will help them pocket nearly $3.6 billion.

We also need to reduce our dependence on oil. Quebec does not produce any oil and every drop that Quebeckers consume impoverishes Quebec, in addition to contributing to global warming. The Bloc Québécois therefore wants to reduce our dependence on oil.

In 2009 alone, Quebec imported $9 billion worth of oil, less than usual because of the recession, but in 2008, oil imports totalled $17 billion. Over a period of five years, from 2003 to 2008, oil imports increased by $11 billion.

Furthermore, to reduce our dependence on oil, the Bloc has proposed substantial investments in alternative energies to create a green energy fund, launch a real initiative to reduce our consumption of oil for transportation, heating and industry, including an incentive to convert oil heating systems, and introduce a plan for electric cars.

We have to get ready, because by 2012, 11 auto manufacturers plan to introduce some 30 fully electric and hybrid models.

The objectives of Bill C-452 are clear. A bold program focused on green energies and electric cars that will allow Quebec to end its dependence on oil is urgently needed.

Until we can put an end to this dependence on oil, we must give more power to the Competition Bureau by allowing it to initiate inquiries, and by creating a petroleum monitoring agency.

Fairness at the Pumps Act

[Meili Faille, Bloc, Vaudreuil—Soulanges, QC]

How can investigative powers be given to an institution when it must bow to the will of the minister or when this institution is only able to take action after receiving a complaint?

The Bloc Québécois wonders why it takes a complaint and a request by the minister to set the wheels in motion. If the Competition Bureau has information pointing to collusion, it should be able to initiate an inquiry immediately.

Still in 2003, the Standing Committee on Industry, Science and Technology concluded its study on fluctuating gasoline prices with some recommendations. The first was to create a petroleum monitoring agency. The second was to toughen up the Competition Act.

According to the committee, this agency would have been able to clear up confusion among the general public regarding the price of gas by providing existing data to the public. The agency would have overseen all aspects of this activity.

That same year, the Standing Committee on Industry, Science and Technology spelled out the changes it wanted to see made to the Competition Act.

Obviously the Bloc Québécois agrees with this recommendation and it pushed for the government to respect the work of the committee and agree to implement this monitoring body, something it did not do. In response to the committee, the government of the day said it did not feel it was necessary to create this monitoring agency and it argued for the status quo.

In 2005, the Liberal Party of Canada had proposed, through Bill C-19, amendments to the Competition Act allowing for measures to mitigate rising gas prices. Note that, once again, the government did not incorporate the recommendations of the Standing Committee on Industry, Natural Resources, Science and Technology into its Bill C-19. The committee had recommended reversing the burden of proof to address agreements between competitors and to make it possible for the Competition Tribunal to award damages to parties affected by restrictive trade practices, where applicable.

The purpose of the first recommendation was to make it the responsibility of the parties wishing to enter into an agreement between competitors to prove the ultimate social value of that agreement. The second recommendation of the Standing Committee on Industry, Natural Resources, Science and Technology would have made the pendulum swing back the other way since measures restricting the business practices of the guilty parties could have been imposed.

You can guess what happened. Bill C-19 died on the order paper since it was introduced just before the election. That is why, in 2007, the Bloc Québécois introduced Bill C-454. That bill made it to second reading stage, but another election saw the Bloc Québécois bill scrapped. In 2009, a little more recently, the Bloc Québécois noted that the Conservative government had adopted part of Bill C-454. Nonetheless, the government does not think it is necessary for the Competition Bureau to initiate its own investigations.

It is clear that in 2010 nothing much has changed. The flow of information has not improved much and there is no agency governing the attitude of the oil companies, quite the contrary.

The government must deal with problems of fairness swiftly and I want to know what it is waiting for to take action. Consumers are sick of bearing the cost of fluctuating prices at the pump.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, Bill C-14 is obviously important, but frankly, only relatively so. For the next 20 minutes, I will try to clearly explain the Bloc's position. I may not go into every detail of Bill C-14, but I will describe the Bloc's concerns about the Competition Act and the fact that successive governments have done nothing. And, of course, I will describe the Bloc's response to this bill, which is Bill C-452. I will also briefly explain a comprehensive strategy for dealing with increases in the price of petroleum products.

As the parliamentary secretary said earlier in his speech, the government introduced its bill to protect itself and consumers against negligent retailers. “Negligent” is putting it rather mildly. There will obviously be mandatory inspections, but they will be much more frequent. The government is talking about increasing the number of inspections from 8,000 to 65,000. The bill would also authorize the minister to appoint or designate professionals to conduct these inspections. In addition, there would obviously be fines that could be quite high, especially for repeat offenders. Of course, the government says that it is doing all this to protect the consumer.

Has the government, as usual, conducted an impact study of its bill to compare it to what is being done to manage or monitor gas prices at the pump? Naturally, there will be costs associated with all that. Inspections are not free, of course, and retailers will likely be stuck with the bill in the end. I imagine that retailers' costs will go up substantially, all to save consumers about $20 million, which is the estimated difference between the prices. That may seem like a lot of money, and it is, but how many litres and how many consumers are we talking about? Are all the costs of implementing Bill C-14 really worth it? I do have to say, though, that when consumers are hurt, it is our duty to try to make things right.

So I will say right away that we support Bill C-14 in principle. But it does not directly address collusion problems, like the ones that recently came to light in Quebec, nor does it effectively prevent sudden gas price hikes.

The Bloc Québécois still believes that the government needs to work toward offering an effective response to rising gas prices by passing the Bloc's Bill C-452. This bill would strengthen the Competition Act and create a petroleum monitoring agency.

The Competition Act still does not allow the Competition Bureau to conduct an inquiry of its own accord. It has to wait until it receives a complaint before launching an inquiry. The Bloc Québécois also wants the government to establish a petroleum monitoring agency to scrutinize gas prices and to deal with attempts to collude and unjustified price hikes.

According to tools devised to measure how much this is costing consumers, the suggested figure is $20 million.

According to the April 2009 gas consumption data that I found, that $20 million corresponds to one-tenth of a cent per litre of gas purchased in Canada. The cost of gas varies from 90¢ to $1, but it always includes a decimal that people rarely look at. However, oil companies adjust their prices to a tenth of a cent, which represents an amount much higher than the $20 million per year those tools suggest.

Overall, a one-cent difference adds up to $200 million per year, not the $20 million they are trying to correct for.

The Minister of Industry introduced Bill C-14 at first reading on April 15, 2010, claiming that it will protect Canadian consumers from inaccurate measurement when they buy gas. The proposed bill would make retailers more accountable by imposing regular mandatory inspections of measuring devices, such as gas pumps.

The penalties that the courts can impose under the Weights and Measures Act will increase from $1,000 to $10,000 for minor offences and from $5,000 to $25,000 for major offences. For consumers who feel they have been wronged, this might lead them to believe they have increased protection thanks to their hallowed and benevolent government. This is just more smoke and mirrors to trick consumers who believe they are being protected from additional costs, when the government is not doing enough to protect them when it comes to gas prices.

I am going to skip the other possible fines, because I would like to get straight to the point. The new section 29.28 in the Electricity and Gas Inspection Act allows the Minister of Industry to disclose the names and addresses of people convicted under this legislation.

If the retailer can show that he did due diligence and did everything to ensure the accuracy of his equipment, his name will likely not appear on the list of those whose equipment is defective in terms of measuring the volume. We need to determine how this measure will be applied, because any retailer could wind up on that list, even by mistake.

A clarification has been made to establish that violations of this legislation are not actually offences and therefore not subject to the Criminal Code. The individual would not have a criminal record following a conviction.

If convictions are frequent, can they be subject to a prison sentence, in cases of repeat offences, of less than two years, since they are not criminal offences? Once again, the provinces and Quebec are left to pay for this. With respect to offences, recidivism and imprisonment, Quebec will have to pay, no matter what it costs to send someone to prison for less than two years.

The Bloc's main concern is that every time the price of gas skyrockets, the government invariably says the same thing, that its hands are tied because the Competition Bureau has found that there is no collusion between the oil companies to set the price of gas and therefore there is no problem.

It is always the same answer. It is never the oil companies' fault and when the Competition Bureau conducts an investigation it always comes to the same conclusion: there is no collusion.

It would be rather surprising to see representatives of all the major oil companies openly sitting around the same table at a big restaurant. It is not likely to happen. It may be more difficult, but there must be a will to find a solution.

The Competition Act has major shortcomings that prevent the Competition Bureau from initiating an investigation. Any investigation has to be requested by the department or initiated as the result of complaints. On May 5, 2003, when Konrad von Finckenstein, the then commissioner of competition and the current chair of the CRTC, appeared before the Standing Committee on Industry, Science and Technology, he pointed out the shortcomings in the Competition Act. He said:

...while the bureau's mandate includes the very important role of being investigator and advocate for competition, the current legislation does not provide the bureau with the authority to conduct an industry study.

There was some borrowing from Bill C-452, and equivalent measures were put in place as part of the January 27, 2009 budget implementation act. However, these new provisions still do not give the Competition Bureau the authority to investigate on its own initiative. A complaint is still required before an investigation can begin.

In 2003, the Standing Committee on Industry, Science and Technology concluded its study on gas prices by making two recommendations to the government: create a petroleum monitoring agency and toughen up the Competition Act.

In 2003, the Standing Committee on Industry, Science and Technology also spelled out the changes it wanted to see made to the Competition Act. The Bloc Québécois was adamant that the government respect the committee's recommendations.

In October 2005, shortly before the election, the Liberal government finally agreed with the Bloc's arguments and, as part of its federal plan to help alleviate the impact of high gas prices, introduced Bill C-19 to amend the Competition Act. It strengthened this act by raising the maximum fine for conspiracy from $10 million to $25 million and broadening the Competition Bureau's authority to investigate, which would have allowed it to inquire into an entire industry sector.

However, the government bill ignored these recommendations from the Standing Committee on Industry, Science and Technology: reverse the burden of proof to deal with agreements among competitors and to determine whether there is a conspiracy—the objective of this was to make it the responsibility of the party wishing to enter into an agreement to prove the ultimate social value of that agreement—as well as allow the Competition Tribunal to award damages to parties affected by restrictive trade practices, where applicable.

The Bloc Québécois had proposed numerous amendments along these lines.

Bill C-452 would address the shortcomings in the measures put in place under the January 2009 budget implementation act, Bill C-10

The Competition Bureau needs true investigative powers. Bill C-452 would give the Competition Bureau the authority to carry out real investigations into the industry, if warranted, on its own initiative, something it is not currently permitted to do because it must receive a complaint first.

If this legislation were passed, the Competition Bureau would be much better equipped to take on businesses that try to use their dominant position in the market to fleece consumers.

We could implement a comprehensive strategy to deal with price hikes of petroleum products. For some time now, the Bloc Québécois has been pressuring the government to take action to address the rising cost of petroleum products.

We recommend a three-pronged approach. First, we must bring the industry into line. That is the goal of Bill C-452, which gives teeth to the Competition Act. We should also set up a true monitoring agency for the oil sector.

Second, the industry must make a contribution. With soaring energy prices and oil company profits, the economy as a whole is suffering while the oil companies are profiting. The least we can do to limit their negative impact is to ensure that they pay their fair share of taxes. The Bloc Québécois is therefore asking that the government put an end to the juicy tax breaks enjoyed by the oil companies.

Third, we must decrease our dependence on oil. Quebec does not produce oil and every drop of this viscous liquid consumed by Quebeckers impoverishes Quebec and also contributes to global warming. The Bloc Québécois is proposing to reduce our dependence on oil. All the oil Quebec consumes is imported. Every litre consumed means money leaving the province, thus making Quebec poorer and the oil industry richer.

In 2009, Quebec imported $9 billion worth of oil, a reduction because of the recession. In 2008, oil imports totalled $17 billion, an increase of $11 billion in the five years between 2003 and 2008.

At the same time, Quebec went from a trade surplus to a trade deficit of almost $12 billion, not to mention that the increase in Alberta's oil exports made the dollar soar, which hit our manufacturing companies and aggravated our trade deficit. The increase in the price of oil alone plunged Quebec into a trade deficit. It is time to put an end to the tax holiday for the oil sector.

In 2003, the Liberal government, supported by the Conservatives, introduced a vast reform of taxation for the petroleum sector. Although the oil sector had special status under the Income Tax Act, with its Bill C-48 the government reduced the overall tax rate for oil companies from 28% to 21% and also introduced many tax breaks, including accelerated capital cost allowance and preferential treatment of royalties.

This made taxes for Canada's oil sector more advantageous than in Texas. As if that were not enough, in the 2007 economic statement, the Conservatives presented additional tax reductions for oil companies, which would bring the tax rate down to only 15% by 2012. These tax breaks will enable Canadian oil companies to pocket close to $3.6 billion in 2012 alone. The Bloc Québécois thinks that these measures for the oil companies are unjustified. That it why it is proposing that we eliminate handouts to the oil companies.

I was saying that the long-term solution is to reduce our dependency on oil. We must invest considerably in alternative energies; allocate $500 million per year over five years to green energies; launch a real initiative to reduce our consumption of oil for transportation, heating and industry; introduce incentives of $500 million per year over five years to convert oil heating systems; develop a plan worth $475 million per year over five years for electric cars.

By 2012, 11 manufacturers plan on releasing some 30 fully electric or rechargeable hybrid models. These cars will be more reliable, more energy efficient and much cheaper to operate than gas-powered models.

Bill C-14 is intended to save consumers $20 million. As I was saying earlier, $20 million corresponds to one-tenth of a cent per litre of gas. Therefore, just one cent per litre could save $200 million per year. Furthermore, we must strengthen the Competition Act.

[Anu Bose, Head, Ottawa Office, Option consommateurs]

Good evening.

Thank you, Mr. Chair, members of the Standing Committee on Finance, Mr. Clerk of the Committee and the staff of the committee, for inviting me to appear before you this evening to discuss Part 12 of Bill C-10, that is the proposed amendments to the Competition Act.

My name is Anu Bose and I am in charge of the Ottawa office of Option consommateurs, an organization that is headquartered in Montreal. With me are Michael Janigan, Executive Director and General Counsel for the Public Interest Advocacy Centre in Ottawa.

For over three decades now, our two organizations have been working to represent the interests of consumers in the area of regulated trade. Mr. Janigan has already testified before the Industry Committee on connection with the former Bill C-19 tabled during the 38th Parliament. This bill to amend the Competition Act was never adopted.

We would first note that while the proposed amendments are quite comprehensive, they have certainly been the subject of considerable past discussion amongst stakeholders and, in our opinion, represent a fairly balanced approach to the necessary refinements to the act.

Take, for example, the issue of the amendments that complete the reform of misleading advertising or deceptive marketing that has been the consensus for over two decades. These amendments help the competition authorities address this abuse in an economic and administrative fashion.

In the view of Option consommateurs, this package of amendments places appropriate emphasis on the importance of deterring anti-competitive conduct, particularly in the current difficult economic and financial environment that all Canadians are experiencing.

I'm asking Michael Janigan to give some additional comments on the importance of these amendments.

Competition Act

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Mr. Speaker, it is a pleasure to have the opportunity to speak to Bill C-454, introduced by the member for Montcalm. I think it is a timely discussion for us to have in the House.

Bill C-454 is an act to amend the Competition Act and to make consequential amendments to other acts. We will support the bill at this stage because we believe it is important that it should go to committee to be discussed.

Other members have spoken about some of the things that are contained in Bill C-454. I want to address some of those, but I also want to talk in general about why it is important that we as parliamentarians take our responsibility seriously when it comes to competition.

I filled up my car on the weekend in my home riding of Dartmouth and the price was $1.32 a litre. That is pretty high and the big concern is not what it does to my pocketbook. As a member of Parliament I get paid well to do the job that I do. I have an awful lot of constituents who cannot afford gas at $1.32 a litre. It may be in fact that the price of gas is going to continue to go up. That may be a simple fact of life.

I think Canadians have the right to expect that their government, their members of Parliament, takes seriously the fact that in a free market economy we nonetheless have a responsibility to make sure that competition is real and open, and that in fact it is a free market and not a closed market.

In a previous life I used to run a home heating oil company for the Irving family and I can recall, and I am actually probably younger than I look, but I can recall when the price of heating oil in Nova Scotia was 26.3¢ a litre, which was the posted price for home heating oil in Nova Scotia on or about 1986, just some 22 years ago. The price of heating oil in Nova Scotia now is I think somewhere around 90¢ a litre, so we have gone from 26.3¢ a litre to somewhere around 90¢ and on top of that of course the new government disbanded the EnerGuide for low income houses which has made it even more difficult for families to heat their homes.

If we look at the basics of life, home heating oil in a province like Nova Scotia, where most houses are heated by oil, is not a luxury. It is an absolute necessity of life that one has to heat one's home. At 26.3¢ a litre, even 22 years ago, it was a lot easier to do that than at almost 90¢ a litre today. I think that consumers have a right to ask, where is the protection and is it a fair price?

Consumers are concerned about many things. I think that certainly the bill could address some of those things because people are nervous. What the bill would do is ensure that there is proper scrutiny on what is supposed to be a competitive market and appropriate penalties when companies, large big companies, abuse their right on the open market and are unfair to consumers.

The bill is very similar to Bill C-19 that was brought in during the last Parliament and that was in response to a report released by the Standing Committee on Industry in 2002, entitled “A Plan to Modernize Canada's Competition Regime”.

One of the things that I often talk to my constituents about, and I talk a lot in high schools about, is the work that Parliament does outside of question period and even outside of this chamber, and the fact that committees can do a lot of good work. The committee that I sit on now is the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities. We released a report recently that was very good. The committee was well chaired by the government member for Niagara West—Glanbrook and the work that was done was very positive.

This obviously was a report done in 2002 following up on the VanDuzer report, an independent study of the Competition Act, that was requested at that time by John Manley, who was the minister of industry, and a good one.

The committee worked hard on the report, consulting widely with stakeholders and provided a comprehensive report with a list of recommendations to bring Canada's competition laws up to date. Canada was one of the first industrial countries in the world to adopt a competition or anti-trust law.

Competition legislation is intended to prevent monopolies and price conspiracies that work against the interests of consumers. The Competition Act, Canada's competition legislation, is administered by the Competition Bureau, an independent federal agency.

The way companies and corporations do business has changed a lot in recent years because of new technologies, mainly in communications and transport. Of course, we have had the globalization of trade and a number of government and private members' bills have been introduced to try to cope with these changes.

Bill C-454 is a bill that is similar to Bill C-19, introduced in the 38th Parliament, but some amendments have been added which I think reflect the work of the committee in 2002.

Bill C-454 would, among other things, do the following: authorize the Commissioner of Competition to inquire into an entire industry; create administrative monetary penalties, AMPs, for abuse of dominant position; increase administrative monetary penalties for deceptive marketing, which I think is something else that a lot of consumers are looking for some action on; and repeal provisions dealing specifically with the airline industry, which has been an intermittently scrutinized industry.

At the time that the study did its work, just after the coming together of Air Canada and Canadian Airlines, there were concerns about that. I think there are still concerns about the airline industry and while I am talking about this, I want to commend my colleague from Humber—St. Barbe—Baie Verte, who is bringing forward a private member's bill for an airline passengers bill of rights, which also reflects issues that I hear in my constituency from people who have concerns.

Bill C-454 would repeal criminal provisions for price discrimination, predatory pricing, discriminatory promotional allowances and geographic price discrimination. It would authorize the court to make an order requiring a person who made a false or misleading representation to compensate persons affected by that and to issue an interim injunction to freeze assets. It would allow for these AMPs that would abuse their dominant position in the industry. Now there are criminal penalties, but we need to go beyond that to allow for these other direct penalties to be put in place.

When we talk about consumers and a free market, I think that in general, Canadians would support the fact that we have a free market and would say that it works, but it causes concern when we have price spikes, and it happens in gasoline and heating oil, it has happens in insurance, and it happens in many areas. We are hearing now, with the potential of a downturn in the economy, that food prices are going up, and of course we have the international issue of food scarcity and the hungriest people on this planet are once again those who are penalized the most by that.

All these sorts of issues are causing Canadians concern and to wonder how they are going to pay their bills, how they are going to fill their oil tanks, how they are going to fill their cars, how they are going to afford groceries, how they are going to afford shelter, what will happens if the economy continues to deteriorate, and what will happen if manufacturing jobs continue to go elsewhere.

Other industries such as forestry continue to suffer. An awful lot of consumers are very worried and I think they look to Parliament and to their representatives to say that we believe in a free market and we think that this is the best way to have it, but if we believe that competition works and if we believe in capitalism and that there is in fact a free market, then it has to be free. We cannot allow large companies to have a half free, half closed market which always benefits them. It is important that there be direct action that can be taken to protect consumers in that case.

This bill is complex and it is important that we give this to the committee. The industry committee in 2002 did a good job in having a look at this. That is what committees do well. They call witnesses, talk to consumers, talk to consumer groups, talk to business advocates, and talk to the people who are most affected to consider the work that needs to be done.

Stakeholders and other interested parties will have an opportunity to make recommendations or changes as this goes forward. I am pleased to stand here today and support in principle this bill, so that we can let the industry committee do further work.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Mr. Speaker, it is a pleasure to take part today in the second reading debate of Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other Acts.

My intention is to outline the provisions of Bill C-454, which proposes extensive amendments to the Competition Act.

Bill C-454 contains a number of provisions that were in earlier legislation, specifically Bill C-19. However, Bill C-454 not only alters some of the provisions that were in Bill C-19, but also introduces some new provisions.

The House should not make the mistake of thinking that Bill C-454 is merely Bill C-19 by another name. This is a very different bill in many important ways.

As such, I would caution my hon. colleagues to give this bill very serious attention. Any amendments to the Competition Act will be of great interest to a wide range of stakeholders across Canada.

To show how great an interest, I would refer hon. members to the Competition Policy Review Panel. As hon. members will recall, in July of 2007 the government announced the creation of the panel, which has as the central part of its mandate a review of key elements of Canada's competition and investment policies, including the Competition Act. In the context of its consultations, the panel received approximately 140 written submissions.

Given the importance of the Competition Act for Canadians, I would like to take a few minutes to review some of the provisions of Bill C-454.

First, there are some provisions in Bill C-454 that are the same as those in Bill C-19. For example, Bill C-454 would decriminalize the price discrimination, predatory pricing, discriminatory promotional allowances and geographic price discrimination provisions of the Competition Act. These provisions would then be dealt with under the non-criminal abuse of dominance provisions of the act.

Bill C-454 proposes to allow the tribunal to order restitution to consumers affected by deceptive marketing practices. In addition, the bill gives the tribunal new power to impose interim injunctions to stop the disposal of assets by anyone engaged in deceptive marketing practices. This is to ensure that there is property available for such restitution.

However, there are several key provisions in Bill C-454 that are different from what was contained in Bill C-19. Bill C-454 proposes to add three different types of financial consequences to deter abuse of dominance. I understand that all three would be applied at the same time.

First, the Competition Tribunal could order an administrative monetary penalty, or AMP, against individuals and companies that engage in anti-competitive conduct: up to $10 million for a first offence and up to $15 million for each subsequent one.

Second, Bill C-454 gives the tribunal the ability to order an additional AMP on top of the one I just mentioned. This second AMP would be an amount not greater than the profits generated by the anti-competitive conduct in question.

In addition to these two AMPs, Bill C-454 would allow private parties to pursue separate private litigation before the Competition Tribunal when they believe that a dominant firm has abused its market position. At present, only the Commissioner of Competition may bring abuse of dominance matters to the tribunal. In relation to private access to the tribunal, Bill C-454 includes a provision to grant the tribunal the ability to award damages to private parties.

Next, Bill C-454 introduces a proposal to change the definition of “anti-competitive act” for the purposes of the abuse of dominance provision. Bill C-454 would introduce the concept of “exploitative conduct” into the Competition Act. In other jurisdictions, particularly the European Union, this phrase has been taken to mean excessive pricing or price gouging.

As I understand it, an attempt to deal with price gouging would be viewed as a form of price regulation that would have far-reaching implications for the Canadian marketplace. As such, this provision should be carefully considered.

As we know, price regulation is essentially a matter of provincial jurisdiction. I am quite sure that the sponsor of the bill and his colleagues would not want to intrude on a matter of provincial jurisdiction.

Moving on to the issue of deceptive marketing practices, Bill C-454 proposes a series of financial consequences. The provisions in Bill C-454 include an increase to the existing AMP: from $50,000 to $750,000 for individuals and from $100,000 to $10 million for corporations. For subsequent violations of the act, the proposed AMPs are $1 million for individuals and $15 million for corporations.

At the same time, Bill C-454 provides for an additional AMP for deceptive marketing practices, up to the amount of profits generated by the practices. Again, it appears that both AMPs could be ordered by the tribunal at the same time. Bill C-454 would also amend the list of factors the tribunal considers when determining the appropriate penalty for deceptive marketing practices.

Bill C-454 also amends the anti-cartel provision of the act, section 45. The proposed amendments would strike the word “unduly” from section 45 and raise the level of fines that would be imposed. Section 45 is one of the key provisions in the Competition Act.

As I understand it, removing the word “unduly” could expose to criminal liability conduct currently regulated by provincial or federal law. For example, it is not clear whether provincial authorization of certain price-fixing arrangements, such as through marketing or supply management boards, would continue to shield such arrangements from criminal liability under section 45 if the amendments proposed in the bill are passed.

I see that my time is nearly up. Finally, I would like to say that Bill C-454 would change the rules regarding pre-notification of mergers, by lowering the threshold at which companies considering merging would have to notify the commissioner of their intent. In this regard, we should ask ourselves whether the costs imposed on businesses are warranted.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Mr. Speaker, it is my great pleasure today to speak to Bill C-454, which was introduced by the Bloc Québécois member for Montcalm. First, I would like to congratulate my colleague on his excellent work and on this initiative to bring this important issue back to the House of Commons. It has not lost its relevance over the past few years with the price of gas at the pump now hovering around $1.15.

Bill C-454 is being read for the first time in Parliament, but I want to remind some of my colleagues from other parties that it is inspired in large part by Bill C-19, which the Liberals tabled shortly before the 2005-06 elections, and which the Conservatives decided not to reintroduce. Of course, it has been rewritten and improved, but it is, in essence, the same. If I were to provide a broad outline of this bill, I would summarize it by saying that its purpose is to strengthen the Competition Act.

First, it gives the Competition Bureau the power to conduct its own inquiries into the oil industry. Currently, the bureau can do no more than undertake general studies that have no consequences.

In the course of conducting such inquiries, it can summon and protect witnesses. If it could not do so, it would very likely never be able to prove anti-competitive practices.

Lastly, when companies want to enter into agreements with their competitors, they will have to prove that these agreements are in the public interest. The bill also significantly raises the amount of fines, from $10 million to $25 million.

That said, exactly what need is this bill trying to meet?

Prices of petroleum products are rising steadily, and we want Quebeckers to have a way of finding out why this is happening, who is benefiting and, most importantly, whether this is reasonable.

The first major problem that is affecting everyone to different degrees is the rising price of crude oil. This is having a direct impact on the price per barrel, which is fluctuating today between US$100 and US$110 and has increased by 230% since early 2004.

This in turn is affecting the price of heating oil, which is on the rise. It has averaged about 90¢ since early 2007 and has gone up by more than 50% in the past two years. I want to remind the House that according to Statistics Canada, approximately 500,000 Quebec households in Quebec still heat with oil or another liquid fuel.

The increase in the price of crude oil is also driving up the price of gas, which, understandably, has raised the public's ire for the past several years.

For a number of years, in fact, old records have fallen repeatedly as the price of regular gas has regularly reached new highs. Fluctuations aside, the price of gas in Quebec is going up steadily; it was 71.3¢ in May 2002, 94.4¢ in May 2004 and $1.10 in May 2007. Since the beginning of the year it has fluctuated between $1.09 and $1.18.

At the same time, oil companies have posted record sales for a number of years. But that is not all. Oil companies' net profits have also skyrocketed in recent years. The oil industry's net profits rose from $17.6 billion in 2003 to $20.2 billion in 2004 and $35 billion in 2006, a 100% increase.

What is more, with respect to the increase in costs, if we compare the price of regular gas in Quebec today with the price in 2004, we find that the retailer mark-up has remained stable, taxes have remained stable and even gone down in proportion to the price of a litre of gas, and the increase in the price of crude oil accounts in part for the increases.

But lately, the constant fluctuations in gas prices cannot be explained by crude oil prices; they are attributable to the obscene profits made by the refineries.

Is this situation intentional? We do not know, because the Competition Bureau does not have the tools it needs to conduct a serious and complete investigation. But one thing is for sure: the structure of the oil industry encourages spikes in gas prices, and is conducive to abuse. That is why the industry must be monitored, hence Bill C-454.

As members know, I am the Bloc's natural resources critic, and it is part of my duties to learn about the oil industry. That is precisely what the Standing Committee on Natural Resources did for several months last year, as part of an important study on the oil sands industry. Over the course of about 30 meetings, we heard from some 100 witnesses, many of whom came from the oil industry.

I listened to and questioned these witnesses carefully, and although our conclusions can be found in the committee's report, I would like to share how these testimonies touched me personally.

When I was listening to these professional lobbyists, I was deeply struck by the excesses of the industry, with its echoes of the gold rush.

People in the oil industry came to talk to us, they explained the challenges, confidently predicted the future, easily came up with rational solutions to complex problems in their heads, but were so detached from the effects caused by their industry, that it literally took my breath away.

As everyone also knows, I am a social worker by training, and if I wanted to draw a parallel with a type of clientele, I would say we are dealing with an industry that has a very hard time regarding itself objectively or engaging in any self-criticism, and above all, we are dealing with an industry for whom the end justifies the means and that is always right. It has a bit of a superiority complex, which places it above other things and makes it prone to over-ambition and exaggeration, often in a shameless manner.

In the case of the petroleum industry, the excessiveness of the financial stakes—we are still talking about billions of dollars—and the current importance of their products, which are practically essential to the functioning of society, create this cavalier attitude that often lacks any moral or ethical sensibility. I could give so many examples that I could easily keep the House busy until tomorrow, but let us look at just one, more recent and very typical example.

On Monday, March 10, the Minister of the Environment presented his solutions for climate change problems—a plan whose flabbiness will surely go down in history. One of his proposals is carbon capture and storage by the oil industry. Speaking through a task force that delivered a study to Natural Resources Canada, the oil industry responded that it refuses to invest great sums of money in this technology because of the uncertainty surrounding its large-scale commercialization.

And as if that were not enough, the task force, composed of one academic and four industry representatives, went even further. Try to listen to this without being too surprised:

...it is a very difficult proposition for individual private sector players to commit additional hundreds of millions of dollars...to achieve a public good...for which it may not be compensated with an adequate (or any) return on investment.

In any context that statement would be unacceptable, but in the current climate change crisis, it is totally irresponsible and insulting. This method would force private companies to contain their pollution.

The members of this task force act as if they are doing us a favour. They are completely disconnected from reality, so much so that they add even more. As François Cardinal reported in La Presse on March 11, the report recommends that the federal government allocate $2 billion immediately and that both levels of government provide “stable financial incentives”.

I would like to remind hon. members that the oil industry made $35 billion in profits in 2006. And these people are talking about the impossibility of investing in the public good unless profit is involved?

I also want to point out that in addition to $66 billion in direct subsidies from the federal government between 1970 and 1999, this industry is currently benefiting, through accelerated capital cost allowance, from tax measures such as former Bill C-48, under the Liberals in 2003, and from tax cuts announced by the Conservatives in the economic statement of November 2007 of up to $1.5 billion annually.

In the coming year alone, the oil industry will receive a $1.18 billion gift. In total, for the 2008-13 period, roughly $7.8 billion will go into the pockets of the oil companies through various measures implemented by both the Conservatives and the Liberals.

Yesterday I received a phone call from a constituent from Saint-Bruno—Saint-Hubert, who said that her heating costs have increased by 50% in two years. She thought that was totally unacceptable.

Bill C-454 is needed to help people like that and to supervise the oil industry more carefully. We hope the bill will be adopted.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Mr. Speaker, I rise to speak to Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other Acts and to congratulate the hon. member from the Bloc Québécois for introducing it.

The Competition Act is an important law in Canada. It governs how we do business in a number of ways. The purpose of the Competition Act is to encourage Canadian businesses to compete with one another with the belief that enhanced competition will lead to lower prices and greater product choice for consumers.

The Competition Act contains criminal and civil provisions which apply to most industries and businesses in Canada, both large and small. The Competition Bureau is an independent federal agency which administers the act.

The current act criminalizes some anti-competitive practices. The criminal provisions include: conspiracy to unduly lessen competition; bid rigging; discriminatory and predatory pricing; price maintenance; refusal to supply; and certain misleading advertising and deceptive marketing practices. The offences are investigated by the Competition Bureau and prosecuted in federal or provincial superior courts.

Attempts have been made before to update the Competition Act. In April 2002 the House of Commons Standing Committee on Industry, Science and Technology released a report entitled “A Plan to Modernize Canada's Competition Regime”. It recommended extensive amendments to the Competition Act.

Subsequently Bill C-19 was introduced. It proposed changes to the Competition Act that would have allowed the Competition Tribunal to impose an AMP, an administrative monetary penalty, if it found that a person or a company abused its dominant position. It would have increased the AMP that the Competition Tribunal or court could impose when it found that a person or company had engaged in deceptive marketing. It would have repealed the airline specific provisions that are currently found in the act, which arose out of a particular period in Canada's aviation history and were designed to deal specifically with the airline industry. Bill C-19 proposed to decriminalize predatory and discriminatory pricing provisions.

At the time, there was a great deal of debate about Bill C-19 but it died on the order paper and ultimately did not pass. The Competition Act remained unchanged and that is very unfortunate for Canadians.

Every time the price of gasoline goes up, we hear complaints from our constituents. They see gas prices rise in lockstep usually just before a long weekend. The greatest instance of consumer complaints is probably from people who believe they are being gouged by gas and oil companies.

The government should deal with this in a more effective way. It is clear that the Competition Act, as it currently stands, does not have the teeth to deal with this kind of price gouging. It should be thoroughly investigated so that Canadian consumers are protected.

The issue of deceptive marketing and deceptive advertising is also of great concern to Canadians. We have an aging population. We all know of situations where seniors especially have fallen prey to deceptive advertising. Again, the Competition Act simply does not have the teeth to protect consumers. It is basically a buyer beware situation, and that is simply not good enough.

We should think of a situation where an individual senior, who lives alone in his or her own home, who maybe does not have access to the Internet, and does not read as widely as some other folks, is up against a very powerful and well resourced company that has a very slick marketing campaign. That individual senior could be quite vulnerable. I believe it is our job as parliamentarians to do everything we can to ensure that all consumers are protected.

We all want to foster a healthy economy. We want to make sure that we are creating the conditions for businesses in our economy to do well and for them to compete. We have a very mature economy, but there has to be a balance so that consumers are also protected.

Today the average person is really getting squeezed. Savings are at an all time low and consumer debt is the highest it has been in a generation. People are incredibly price sensitive. There are people who have to commute from the suburbs to the centre of town to go to work every day. Some people in my part of the country and the greater Toronto area commute long distances. With respect to the price of gas, people are phenomenally price sensitive. When the price of oil goes up, consumers really take a hit in the pocketbook. They need us to make sure that they are protected.

There is one concern that I do have with this bill, and it was a concern with Bill C-19 as well, which is that the AMPs, the administrative monetary penalties, would be tax deductible for the corporations that face these penalties. That does not make any sense. It makes no sense that the Government of Canada and the Canadian taxpayers would somehow be responsible for paying these monetary penalties. That is something we should discuss at the committee.

I will be supporting this bill. As a member of the industry committee, I look forward to discussing the bill at the industry committee. The goal is to protect Canadian consumers, to put teeth into the Competition Act, and to protect our seniors from deceptive advertising. I believe all of these provisions would lead to greater competition and a healthier economy.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I am pleased to speak to Bill C-454. I would like to congratulate the member for Montcalm on his bill.

The origins of the bill can be traced back to early 2002 when the Standing Committee on Industry, Science and Technology released a report entitled, “A Plan to Modernize Canada's Competition Act”. The proposed changes from that committee's report formed the basis of government Bill C-19 during the 38th Parliament, under the leadership of the member for LaSalle—Émard.

Reading this private member's bill, I noticed that virtually all the provisions of Bill C-19 have been included as well as some of the other recommendations from the industry committee's 2002 report, which did not find their way into the original bill.

I understand many of the additions in Bill C-454 had been proposed during the rather lengthy year that the industry committee spent studying Bill C-19 before it died on the order paper in November 2005.

Above and beyond those additions, Bill C-454 has a number of other amendments that were not in the original bill.

While I am willing to lend my vote to the bill at second reading, I do so in the hope that it will receive the same diligent consideration at committee stage that Bill C-19 received in 2005. We must, as legislators, ensure that the objectives of the bill will be met without any unintended consequences.

To reiterate my position for the member, the bill shows good promise and I will support it at this stage. However, I will reserve my final judgment until it returns from committee wherein stakeholders and Canadians will have had the opportunity to voice their praise or their concerns for the bill.

While I am on the topic of committee stage, I hope the industry committee' s efforts to review the bill will be well coordinated with the Minister of Industry's review of the Competition Act. I believe the minister is expecting his panel to report later this spring and I hope that the two tracks will find some common ground.

The underlying purpose of Bill C-454 is to enhance the Competition Act, with a view to ensuring that businesses in our country compete with each other in a fair and open market. The act helps to protect businesses, especially small businesses, but large ones as well, from becoming the victims of such anti-competitive behaviour as predatory pricing and abuse of dominance.

The end beneficiary of this is the Canadian consumer, who will benefit from increased competition, diversified choice and in theory lower prices at the cash register. The act achieves this through the Competition Bureau, which enforces the provisions by responding to consumer complaints and investigating evidence of illegal activity by businesses.

The biggest change that Bill C-454 would make to the Competition Act is it would allow for general administrative monetary penalty, or AMP, provisions to be used against businesses or individuals abusing their dominant position in any industry. This would allow businesses and individuals injured by an abuse of dominance to seek financial remuneration for any damages they have suffered due to abuse of a dominant position. Currently there are only criminal penalties for such breaches of the act.

Similar administrative monetary penalty provisions are already in place for abuse of dominance in many countries around the world. Adding Canada to the list of countries that allows for these fines in cases where dominance has been abused is important, not only domestically but also in terms of strengthening ties with our major trading partners.

Let me move on to other aspects of Bill C-454. One is that the bill would increase the administrative penalties, or AMPs, that a business could be fined for practising in deceptive marketing practices. With the low limits of the current maximums, deceptive marketing can often lead to profits that are far greater than the monetary penalties that can be administered. By raising the limits, we will increase the deterrence factor and help to ensure that the people who are hurt by deceptive marketing campaigns can get a much greater percentage of their investment back from the guilty party.

Another measure included in the bill, which came directly from the industry committee's 2002 report, was to eliminate the section of the Competition Act that dealt specifically with airlines. This special mention of our airline industry was added at a time when Canadian and Air Canada were merging and there was widespread concern that the Competition Bureau needed stronger tools to ensure that the combined giant did not engage in predatory conduct.

Today, however, there are many low cost carriers that have emerged and the airline industry no longer needs special mention in the act. The industry can go back to being covered by the general provisions, which, as I have mentioned, would be strengthened the bill.

I am glad to see that the Bloc Québécois have taken an interest in helping to build a stronger 21st century economy, supported by a competitive marketplace and a competition with the tools to ensure that they get the job done. The Bloc often takes a narrow and isolationist approach to economic matters, so it is nice to see it put country before its own party interests.

It would have been very easy for the Bloc for instance to dismiss a bill, such as C-19, as an intrusion of the federal government into matters of provincial jurisdiction. For instance, price controls are the exclusive jurisdiction of the provincial government, save for in emergency situations. The Bloc of old might have believed that the federal government had no place deciding when a business had engaged in predatory pricing. Determining the appropriate price of something could be interpreted as a matter purely for provincial jurisdiction.

In this instance I am glad to see that my Bloc colleague from Montcalm was willing to table a bill that proves a federal bill can be good for all Canadians including the people of Quebec.

I look forward to seeing what the industry committee does with Bill C-454 and when it arrives back here in the House for report stage and third reading.

[Roger Gaudet, Bloc, Montcalm, QC]

Mr. Speaker, the Parliamentary Secretary to the Minister of Industry is somewhat mistaken. When it suits him, he says that is a provincial matter; when it does not suit him, he is prepared to meddle in provincial jurisdictions.

That is not a valid reason. Why is there a Competition Bureau in Ottawa if it is interference in provincial matters? I would like the parliamentary secretary to give me a reason.

In addition, the parliamentary secretary should not forget that the Conservatives did not wish to bring back Bill C-19, introduced by the Liberals, as they were lobbying the government on behalf of the companies.

That is my answer to the Parliamentary Secretary to the Minister of Industry.

[Roger Gaudet, Bloc, Montcalm, QC]

moved that Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other Acts, be now read a second time and referred to a committee.

Mr. Speaker, it is a pleasure for me to introduce Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other Acts, for second reading. While we have a Competition Act at present, there are major flaws in that Act that are in need of speedy correction. I would like to demonstrate the need for the House of Commons to take action to improve the existing Competition Act.

Every time the price of gas soars, the government invariably responds by saying the same thing: there is nothing to be done because the Competition Bureau concluded that there was no agreement among the oil companies to fix prices and so there was no problem.

Well, the Competition Bureau has never investigated the matter properly, because it does not have the power to do so. All the Competition Bureau does is produce studies of the industry explaining how it operates. And when it does a study, the Competition Bureau has virtually no power, because the purpose of the studies is to explain the general operation of the oil industry, not to discipline it. Those studies have no impact and they provide no incentive for the government to take action.

The flaws in the existing Act prevent the Competition Bureau from doing any real work. The Competition Bureau cannot initiate investigations of its own accord; they have to be done in response to a request by the minister or where there have been a number of complaints. Well, we know very well that the minister is not requesting real investigations from which tangible results could be obtained.

In addition, the Competition Bureau cannot compel disclosure of documents or protect witnesses when it does a general industry study. In that kind of situation, how can we expect that individuals who have no protection will come forward to testify? As can be seen, there are limits to what the Competition Bureau can do—and that is putting it mildly. In point of fact, its hands are tied.

We need only look at the current situation to understand that it is urgent that the Competition Act be amended. The price of petroleum products is rising steadily. The price of crude oil has risen by 230% since early 2004. The price of heating oil has gone up by more than 50% in two years. Three years ago, in April 2005, a new price record was set in Montreal: the price of regular gas broke through the one dollar ceiling. Since then, it has stayed at an even higher level. In Quebec, the price continues to go up: the price of a litre of gas was 91.6¢ in May 2005, $1.06 in May 2006 and $1.10 in May 2007, and it has wavered between $1.09 and $1.18—and we have even seen $1.23—since the beginning of 2008.

But that is not all. Refining margins vary remarkably. It actually costs between 3¢ and 5¢ to refine a litre of gas, depending on the type of gas used.

According to the Association québécoise des indépendants du pétrole, when the refining margin is between 4¢ and 7¢ a litre, the company is making a healthy profit. On average, from 1998 to 2002, refining margins were 7.2¢ a litre. That is a little high, but it is within the limits of what is reasonable.

In 2003, on the other hand, the average margin in Montreal was 10¢ a litre, or twice as much as a reasonable amount. In 2004, the average refining margin increased 10% to 11¢ a litre. By 2005 and 2006, it was regularly exceeding 15¢ a litre, and in May 2007, it even reached 28¢ a litre. That is four times the reasonable margin.

At the present time, the refining margin has fallen back to 9¢ a litre, which seems better. However, when the oil companies decide they want their refining profits to soar again, the Competition Bureau will still not have the tools it needs to conduct a real investigation unless the House passes Bill C-454.

It is a great concern as well that a very small number of players have virtually total control over a market as important as gasoline. Is this situation international or not? We do not know because the Competition Bureau does not have the tools it needs to answer that question.

There is no need to remind the House of how shamelessly the oil companies are taking advantage of this. They are posting record sales. In 1995, the entire Canadian oil and gas sector posted combined sales of $25 billion. By 2004, this figure had climbed to $84.9 billion, which amounts to an increase of 239%. Total sales soared to $106.7 billion in 2005 and $118.9 billion in 2006. That is a 376% increase over 1995.

Net profits are also skyrocketing of course. The combined net profit of the six big integrated oil companies in Canada—Imperial Oil, Shell Canada, Husky Energy, Petro-Canada, Encana and Suncor—reached $12 billion in 2006. That is a $5 billion or 70% increase over 2004. The 2007 data are not available yet for all these companies, but there is every reason to believe that their results will be even more astronomical. For example, Petro-Canada finished its 2007 year with a profit of $2.73 billion or 57% more than in its 2006 financial year, which it finished with a net profit of $1.74 billion.

The net profit of the entire oil sector rose from $17 billion in 2003 to $20 billion in 2004 and then $35 billion in 2006, for an increase of 100%.

The Competition Bureau will only be useful and effective if it is able to conduct real investigations. It is illusory to think that it can take real action and come up with real results under the current legislation.

This worrisome situation—the increase in the price of gas, the upward trend in refining margins and the increase in profits—and the flaws in the current Competition Act are a constant source of discussion at the House's Standing Committee on Industry, Natural Resources, Science and Technology. In fact, in the committee's 2003 report on the Competition Act, it recommended reversing the onus of proof for handling “agreements between competitors” and determining whether there is a conspiracy.

In other words, when the Competition Bureau conducts an investigation, only at the request of the minister or if there is a complaint, of course, the Bureau must prove that there was an agreement between the companies, when it should be the opposite. If we consider the economic issues that are at stake, businesses should have to prove their good faith. Businesses that want to sign agreements should also have to prove the social or economic value of the agreements.

For example, in Quebec, there is a single refinery that supplies all the companies, Petro-Canada, Ultramar, Shell, Exxon, Olco, Esso Imperial and so on. The prices are all the same. How can we talk about competition when all the oil companies are in bed together helping each other out and sharing the market? This situation is reminiscent of a cartel—a group of businesses conspiring to create a monopoly.

When Konrad von Finckenstein, the competition commissioner, appeared in front of the Standing Committee on Industry, Natural Resources, Science and Technology on May 5, 2003, he identified the following shortcomings in the Competition Act:

—while the bureau's mandate includes the very important role of being investigator and advocate for competition, the current legislation does not provide the bureau with the authority to conduct an industry study.

He added, and I quote:

It seems to me that it would be preferable to have a study on the overall situation carried out by an independent body that would have authority, that would be able to summon witnesses and gather information. It should also have the power to protect confidential information that someone is not necessarily going to want to share, but which would be vital in order to reach a conclusion based on the real facts.

These statements prove that the existing Competition Act does not enable the Competition Bureau to undertake a real investigation of the industrial sector. How can it gather information if it can neither force the disclosure of documents nor protect witnesses?

During the last Parliament, a review of the legislation was undertaken. The Bloc Québécois found it too weak, but nevertheless supported it and proposed amendments to improve it. The bill died on the order paper, and the Conservatives decided not to bring it back, so the Bloc Québécois introduced Bill C-454 to strengthen the Competition Act.

Bill C-454 was inspired in large part by Bill C-19, which the Liberals introduced shortly before the 2005-06 election, but it corrects that bill's shortcomings. When the Standing Committee on Industry, Natural Resources, Science and Technology studied the act in 2003 and 2005, it found that the act contained a number of provisions that were outdated and no longer useful. In essence, the bill seeks to adapt the Competition Act to today's economic realities. It gives the Competition Bureau the power to conduct its own inquiries into industry. The Competition Bureau will be able to call witnesses and protect them. That last point is very important.

Under current legislation, if businesses decide to reach an agreement to fix prices, no evidence of that will be left behind. If we cannot call and protect witnesses, there is a very good chance we will never be able to prove anti-competitive practices.

Under the new legislation, when businesses try to reach agreements with their competitors, they must demonstrate that those agreements are in the public's best interest. Presently, these agreements among competitors are permitted, unless it can be proven that they are contrary to public interest. This is unhealthy.

The bill contains another proposal: a significant increase in the amount of fines to be paid for violations of the Competition Act, from $10 million to $25 million. If this legislation were passed, the Competition Bureau would be much better equipped to fight against businesses that try to use their dominant position in the market to fleece consumers and damage other economic sectors.

On the whole, Bill C-454 will allow for the creation of a comprehensive strategy to deal with the rising cost of petroleum products. For some time now, the Bloc Québécois has been pressuring the government to take action to address the rising cost of petroleum products. Fighting to defend the interests of Quebec, the Bloc Québécois would like to see the oil and gas industry disciplined. Bill C-454 is a step in that direction. It is time to correct the situation and give the Competition Bureau the powers it needs to do its job properly.

Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other Acts, is pivotal to any real investigations into the oil and gas sector. Passing this legislation would give the Competition Bureau the powers it needs to carry out its mandate.

Opposition motion—Gasoline Prices

[Scott Brison, Liberal, Kings—Hants, NS]

Mr. Speaker, I would like to correct the record. I was never a Conservative. I was a Progressive Conservative. I think the hon. member was drawing attention to some of the cleavages between the former Progressive Conservative Party and the current Reform-Alliance-Conservative Party, and I think he was right to do so, but I am glad to have the opportunity to correct the record.

Once again, I draw the member's attention to the changes to the Competition Bureau proposed in the Liberal government's legislation, Bill C-19, in the fall of 2004, which addressed these issues. The Liberal government did act.

The member also mentioned the results of the last election. He said that Canadians voted, and of course we accept the results of the last election, but I hope the member's constituents understand that his NDP helped to defeat a government that introduced national early learning and child care, a policy that ostensibly the NDP members believe in but voted against, thus defeating a government that was implementing it. Beyond that, it was a government that believed in the Kyoto accord and in fact had taken action to move toward respecting the Kyoto commitments. Beyond that, it was moving further. It was defeated by that party to elect the most neo-conservative government in the history of Canada, a government that is opposed not only to Kyoto but to national child care.

In fact, I think the member has to answer to his constituents and to his NDP base across Canada and explain why, on everything from law and order and justice issues to the environment and issues around early learning and child care, he has elected and supported and continues to support a neo-conservative, republicanesque government that is opposed to the basic values of the NDP.

Business of the House

[Tony Valeri, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, I see the hon. member across the way is displaying his charm once more.

I also think the hon. member understands clearly that the call for the election and, ultimately, if there is an election caused, it will be the opposition members who will have to take responsibility since they will be voting to dissolve Parliament and we will be voting to sustain Parliament in order to continue the work that I will now lay out.

This afternoon we will continue with the opposition motion.

On Friday we will call consideration of the Senate amendments to Bill C-37, the do not call bill; report stage and third reading of Bill S-36 respecting rough diamonds; report stage and third reading of Bill C-63, respecting the Canada Elections Act; and second reading of Bill C-44, the transport legislation.

We will return to this work on Monday, adding to the list the reference before second reading of Bill C-76, the citizenship and adoption bill; and second reading of Bill C-75, the public health agency legislation.

Tuesday and Thursday of next week shall be allotted days. There are some three dozen bills before the House or in committee on which the House I am sure will want to make progress in the next period of time. They will include the bill introduced yesterday to implement the 2005 tax cuts announced on November 14; Bill C-68, the Pacific gateway bill; Bill C-67, the surplus legislation; Bill C-61, the marine bill; Bill C-72, the DNA legislation; Bill C-46, the correctional services bill; Bill C-77, the citizenship prohibitions bill; Bill C-60, the copyright legislation; Bill C-73, the Telecom bill; Bill C-60 respecting drug impaired driving; Bill C-19, the competition legislation; Bill C-50 respecting cruelty to animals; Bill C-51, the judges legislation; Bill C-52, the fisheries bill; Bill C-59 respecting Investment Canada; Bills C-64 and C-65 amending the Criminal Code.

In addition, there are the supplementary estimates introduced in October that provide spending authority for a wide variety of services to the Canadian public and we the government would certainly like to see this passed.

Energy Costs Assistance Measures Act

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, this is an interesting debate because the fact is that it is the current Prime Minister who actually holds the record for giving the most corporate tax cuts to the wealthiest in Canada. The competition between the Harris regime and the current Prime Minister to see how many of their friends they can reward is something Canadians are sick and tired of.

I have a question for the hon. member concerning a specific point she made in her debate today relating to the fact that consumers could somehow rebel and could actually force the oil and gas companies to follow certain types of procedures. That is not very realistic because people need to take their kids to school and taxi drivers and truck drivers need to work. Some people in rural pockets of the country who cannot access mass transit are susceptible to the whole industry in itself.

What is interesting to note from the testimony we heard in the industry committee is that prior to hurricanes Katrina and Rita the industry experts classified their profits from this as spectacular. The government's bill does nothing about that situation and neither does the Competition Act nor the amendments. Anti-competitive behaviour is one thing but profiteering ostensibly is another, and it is not taken care of in the act. In fact, big oil companies reaped almost $38 billion in profits in the first half of 2005 alone, before the hurricanes are calculated in.

During our discussion at the industry committee, the Minister of Industry talked about the fact that we do have some legislative changes coming on Bill C-19. When I asked him about those changes and how the industry would react to them he said, “We didn't want it to be seen by industry to be too arbitrary and punitive”. That was his response to the punish mechanism that is now being put in place.

If the Minister of Industry is creating a system that is not punitive and is not going to be seen as punitive to big oil companies, could the hon. member tell us what motivation these companies would have to actually amend their practices in this field?

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Madam Speaker, it is my pleasure to address Bill C-66.

I want to read the bill into the record and what it is supposed to do, because it is important in terms of analyzing whether or not it actually fulfills the government's objectives in terms of addressing the increasing costs of home heating fuel and gasoline prices for Canadians. The full title of the bill is “an act to authorize payments to provide assistance in relation to energy costs, housing energy consumption and public transit infrastructure, and to make consequential amendments to certain acts”. The bill has three main parts.

Part 1 of the bill outlines who will receive a payment and how much. The payment is targeted to some low income Canadians and will be sent to three different groups: first, $250 to families entitled to receive the national child benefit supplement in January 2006; second, $250 to senior couples where both spouses are entitled to receive the guaranteed income supplement, the GIS, in January 2006; and third, $125 to single seniors entitled to receive the GIS, in January 2006. These are one time payments that will not be issued until the bill is passed.

Part 2 of the bill increases and expands financial assistance and incentive programs for houses and housing projects that make heating system upgrades, improve windows and engage in draft proofing, et cetera. All of this assistance will be delivered over a five year period.

Part 3 deals with public infrastructure. It states that $400 million previously provided for under Bill C-48 will be freed up by Bill C-66 in each of the next two fiscal years for municipalities to boost investments in urban transit infrastructure.

Parts 4 and 5 of the bill are housekeeping measures.

In addition to the measures laid out in the bill, the government has also announced two other measures with respect to energy prices. First, the office of petroleum price information will be created. Second, the government has indicated it will be introducing amendments to Bill C-19 which are intended to strengthen the role of the Competition Bureau in investigating allegations of price fixing in the oil and gas industry.

To begin, I would like to discuss the reasons for various increases in energy costs. Then I will address the issue of payments for low income Canadians and offer an alternative plan to the Liberal plan. Then I will discuss the secondary measures introduced to attempt to offset high energy prices which are outlined in the bill and those announced outside of the bill. Finally, I will discuss energy policy generally under the government.

I would like to briefly outline the current supply and demand issues facing Canadian consumers, Canadian businesses, and our market. There has in fact been a spike in energy prices. There have been a number of contributing factors to the reduction in supply that have caused this spike.

The first obviously is natural disasters. Hurricanes Katrina and Rita have caused considerable disruption in the supply of oil and gas in the Gulf of Mexico and across North America. As of October 11 three refineries were still shut down from hurricane Katrina and four were still shut down from hurricane Rita, obviously taking that supply off the market.

While Canada is in fact a net exporter of energy, we do import a great deal of our refined oil and gas, especially those provinces east of Manitoba.

International issues such as the political troubles in Iraq, Nigeria and Venezuela have created uncertainty in the supply chain. In addition, there have been production declines in the North Sea and Russia, while worldwide spare production capacity is at its lowest level in three decades. Only Saudi Arabia at this point has any spare crude oil production capacity available.

Despite the decrease in supply, demand has remained stable. The 2004 demand increased worldwide by approximately 3%. This growth will likely slow, but will continue to grow between 1.5% and 2% in 2005-06.

At a briefing this week by four of the industry associations involved in the energy sector, it was basically pointed out that over 40% of the increase in the demand for worldwide crude was as a result of the growing economy in China particularly.

This steady demand coupled with the decrease in supply has led to increased energy prices both at home and abroad in every sector.

I must point out, however, that most of the Canadian information on the projected increase in energy prices for the upcoming winter actually comes from the U.S. Energy Information Administration, a statistical agency of the U.S. Department of Energy. It is a shame that similar information cannot be obtained from the federal government through the Department of Natural Resources.

MJ Ervin & Associates, the private sector forecaster and observer of oil and gas prices, has estimated that the average price of home heating fuel has jumped to its highest level on record, 93¢ a litre. The best guess is that homes heated with oil can expect to pay 32% more this year, while homes heated with natural gas can expect to pay 48% more. Electricity bills will also rise but not as dramatically.

In New Brunswick the cost of home heating oil is 5¢ higher than the national average. New Brunswick Power has announced it will request a 10% increase in its electricity rates next year. In Quebec where 70% of the homes are heated by electricity, the provincial energy board will review a request by Hydro-Québec to increase rates by 3%.

In Ontario the Ontario Energy Board approved a rate increase for Enbridge gas that will increase natural gas bills by about $123 a year. Union Gas also sought and received a rate increase. Sixty per cent of Ontario residents rely on natural gas for heating.

The British Columbia Utilities Commission just approved a 13.3% increase in natural gas. Even in Alberta, Direct Energy has asked the Alberta Energy and Utilities Board to approve a rate increase that will increase the average home heating bill by more than 20%. The average monthly bill for October in Calgary will be $162.

As we can see, the increase in the cost of heating one's home is affecting Canadians from coast to coast to coast. What has the government done to deal with this massive, broad problem facing Canadian citizens and businesses across the country?

At the heart of Bill C-66 is a payment for some of Canada's poorest citizens. Obviously we in the Conservative Party support measures that provide relief for low income families. We have an obligation to represent and support those who have so much less than the average Canadian.

The government estimates that 3.1 million low income families, or 10% of Canadians, will receive these so-called rebate cheques, although they are actually payment cheques. I am pleased that some effort is being made to try to assist low income Canadians. These Canadians should not simply be left on their own to try to deal with rising energy costs, particularly those on fixed incomes dealing with increases in home heating.

The problem is that the delivery method chosen by the government will miss too many Canadians who need help paying their heating bills and their gasoline bills for their cars to get them to and from work. Persons with disabilities who claim a disability benefit will not receive the payment. Seniors who qualify for the GIS but do not claim it will not receive a payment. A Statistics Canada study released on Friday, October 21, 2005 found that over 206,000 eligible individuals missed out because they did not in fact claim the GIS.

With respect to seniors, we also have a situation where someone whose pension makes them equivalent to someone on the GIS will not in fact receive any sort of assistance under the government's program. Students will not receive a payment.

This program will not help poor Canadians who do not have children. Research from Statistics Canada again indicates that nearly two million individuals under 65 who fall below the low income threshold have no children. Under this bill these individuals will receive no help.

It will miss most farmers who have been hit very hard by the energy price spike. They must not only heat their homes but their barns as well. It will also miss many Canadians who are poor, but not quite poor enough in the government's eyes to qualify for a payment. Of course, it must be noted that this plan does not in any way, shape or form offer relief at the pump nor compensate for the increase in fuel prices.

We in the Conservative Party have an alternative. We have an alternative because too many Canadians will not be assisted by this plan. We have a plan that will help all Canadians. The fact is the government should start by axing the tax on the tax at the pumps. This would give an immediate tax break to all Canadians. Two Liberal members spoke and basically gave the party line as to why the Liberal government does not want to do this.

The fact is it would be a very immediate measurable thing that would impact Canadians by reducing the tax at the pumps. It would obviously reduce it for people who drive their own vehicles but it would also reduce it, as the member mentioned, for public transit. It would also reduce it for municipalities and others who have to pay for school divisions, who have to pay for fuel, who have to ship students to and from school, municipalities that have to subsidize their public transit.

Further to that, if the government wants to help public transit, then it should adopt the plan put forward by our leader this summer in Toronto to allow people who have public transit passes to claim a certain percentage of the cost. It is not one or the other. We can do both at the same time and offer tax relief to more than just a few Canadians in this plan.

The fact is 42% of the cost of a litre of gasoline is federal, provincial and municipal taxes, including the GST. As a comparison, in the United States it is 27%. Currently the 7% GST and the HST are charged on gasoline after federal, provincial and in some cases municipal governments have added their excise taxes.

The fact is the Liberal government continues to overtax Canadians. The government should not profit when people are feeling the effects of these increased prices in their pocketbooks and at the dinner table.

For every 1¢ increase in gasoline prices, the federal government receives about $32 million in extra revenue. That money should be going back into the pockets of Canadians and not into the pockets of the government.

In addition, the Conservative Party will reduce personal taxes overall. That is the second way to immediately address this issue in a broad way. Instead of selectively picking some low income Canadians over other low income Canadians, we could reduce personal taxes overall.

A Conservative government's approach would provide immediate and long term broad based tax relief starting with reducing personal income tax rates and substantially raising both the basic personal exemption and the spousal exemption under the Income Tax Act. Reducing personal income taxes would hike the take home pay and raise the standard of living of all Canadians.

The fact is we have driven the tax agenda in this country for years and we will continue to do so because it is fair. It is fair that Canadians keep more of their own life energy in their own pockets to spend as they best see fit.

I want to move on to the second part of the bill. I want to point out that while part 1 books the expenditures on payments to low income Canadians in the current fiscal year, the expenditures in part 2 are over five years. This is very odd accounting, but as we are finding out more and more with the way the government deals with budgets and finances, it is simply a classic example of Liberal accounting.

What I believe the Liberals are trying to do is to force us to accept spending on the EnerGuide program, spending that could have been announced in past budgets or in the next budget. They want us to accept this by tying it to the energy payment for low income Canadians. There is no reason to put it in this bill.

In fact Bill C-66 includes $205 million from already announced energy efficiency programs, and $100 million which is being moved out of Bill C-48 and into Bill C-66 under the guise of energy efficiency. This is simply ridiculous. This clause of the bill is completely unnecessary. A whopping 43% of the funds set aside for the bill will go to the administration of the EnerGuide program, not toward tax cuts or rebates.

In theory, the EnerGuide program provides financial assistance to homeowners and landlords to help improve energy efficiency. I encourage members to talk to constituents who have actually utilized this program, because I have. The fact is it is an extremely complicated program. It requires a homeowner or landlord to pay for an inspection of their home both before and after renovations to see if they can receive a loan or rebate for the changes they have made to improve the energy efficiency of their own home. Some funding will flow through the Canada Mortgage and Housing Corporation, but will benefit only 130,000 low income Canadians. The same number, only 130,000 Canadians, have used this program since October 2003.

We are spending more than $1 billion on an EnerGuide program that may be only used by 260,000 Canadians. This is yet another example of misguided Liberal priorities.

I would like to move on to part 3 of the bill, which deals with infrastructure. Again, this section of the bill is not necessary. This spending was announced under Bill C-48, the second budget bill, but has been moved to Bill C-66, which is a bad example of tricky Liberal accounting. This is certainly a question that the government should have to answer.

First of all, how can the Liberals introduce a budget by Bill C-43 and, second, declare non-confidence in their own budget, introduce a second budget, say that the funding would proceed once they knew the fiscal figures for 2004-05 and say that spending would commence as of August 2006? I believe that is what the parliamentary secretary told the Senate committee. Then, somehow, the government moved spending from that bill, Bill C-48, to this bill, Bill C-66.

This money does not help rural Canadians, who pay some of the highest energy costs. In addition, it does not provide the stable funding that municipalities are looking for. The money is actually being allocated without any thought as to what it actually might be used for.

The Conservative Party, on the other hand, is committed to developing an infrastructure plan that would not only provide money to municipalities to meet infrastructure needs, but would also provide benchmarks to allow local governments the ability to plan in the long term for their own infrastructure needs.

We have also committed to meeting and even possibly exceeding the amount of money spent on infrastructure by the federal government through the so-called gasoline tax transfer. Such commitments are very much in line with the infrastructure goals of the Federation of Canadian Municipalities.

Moving to the last two sections of the bill, I note that they deal with measures that are rather small measures in terms of costs but large in terms of the federal government.

First, Industry Canada is finally giving more money to the Competition Bureau to allow it to conduct investigations into collusion. The Conservative Party and members of the Standing Committee on Industry, Natural Resources, Science and Technology have been requesting the government to increase funding to the bureau since April 2002. The bureau has indicated for years that it does not have the resources needed to carry out the investigations.

However, we have not seen the amendments to Bill C-19 that would make changes to the Competition Act and allow the bureau more flexibility in its investigations. I am certainly looking forward to those amendments, although I have a bit of a digression here. At committee we have heard witnesses on Bill C-19, which the government is sort of presenting as the answer to increased gasoline prices by saying that if there is any evidence of collusion it will be dealt with by increasing the powers of the competition commissioner.

I can accept the argument that perhaps more resources are needed for the bureau, but the fact is that any six Canadians can write to the competition commissioner and ask her to investigate any sort of a discrepancy they feel is in the oil and gasoline industry. The government's argument that in fact the bureau needs more powers to conduct investigations is actually ridiculous.

The fact is that Bill C-19, according to some very able lawyers across this country, is simply an incredibly flawed piece of legislation. It is in no way an answer to what the government is saying it is in terms of dealing with gasoline prices. Frankly, the government should even withdraw the bill. It should send this back to the justice department and rewrite a proper bill.

Second, to return to Bill C-66, it would create the petroleum price monitoring agency. It is rather ironic that the government is presenting this as an answer, because lo and behold, the current Prime Minister eliminated this in the 1995 budget. I find it a little strange that something that the then finance minister and current Prime Minister eliminated in 1995 is now being presented by him as an answer in 2005.

The fact is that if the natural resources department would act in a practical manner and provide this information we could easily have this information available. The natural resources department and this entire government have languished in developing a long term energy framework and have actually contributed to the high heating costs we will experience this winter.

The Conservative Party has been focusing for a long time on a long term energy framework which would focus on renewable and non-renewable energy sources, take into account outstanding obligations and meet our long term requirements for domestic consumption and export.

We believe that strengthening energy market integration will ensure greater reliability of energy supplies across the country. We will explore ways to reduce barriers to the movement of energy products across provincial and other borders. The fact is that the Liberals have not addressed any of these issues. The Liberals have not had the time to monitor or publish an energy policy or reports on gas prices, which was promised this fall. Private companies such as MJ Ervin and Associates have stepped in to fill the void.

We find that the bill is severely lacking and way too limited in scope in terms of who it helps and that it is misguided in its approach. We will begrudgingly support the bill, as it does help some low income Canadians, but we certainly hope that the government will bring forward another bill. We will certainly be looking forward to committee, where we can actually try to expand this to help all low income Canadians and in fact all Canadians who are dealing with higher energy costs.

Gasoline Prices

[David Emerson, Liberal, Minister of Industry]

Mr. Speaker, Bill C-19 is in the House. It does strengthen the Competition Act. I am prepared to look at further amendments. We are prepared to look at giving the Competition Bureau the power to undertake investigations of industries and take action as needed. We are prepared to listen if the hon. member has some suggestions for further improvements to the act. We will have further suggestions of our own.

[David Emerson, Liberal, Minister of Industry]

Mr. Speaker, I will be sharing my time with my hon. colleague, the newly minted Minister of Natural Resources.

On behalf of the government, I am very pleased to respond to the motion before the House. There are few occasions when one gets an opportunity to debate an issue with such direct and obvious consequences for Canadians. The price of energy, the price of oil, home heating oil and gasoline is something that all of us deal with in our daily lives. It is something we have seen and felt in terms of prices at the pump in our communities.

We see it through the whole chain of energy prices. The price of electricity is affected by the price of oil and natural gas and coal. All of these are energy products. There is a complete chain of prices affected by some of the gyrations we have seen in recent months to world energy prices and it has effects throughout our economy. It has effects clearly in our ridings where people driving to work face substantial increases in the cost of commuting to work, in the expense of earning a living. We see it as well in commercial areas. In my province of British Columbia the price of oil and fuel was a fundamental cause behind the dispute at the port of Vancouver this summer. That dispute had major implications not just for British Columbians but for all Canadians as we saw shipments and containers held up at the port.

We can all see there are specific ways in which the price of gas and oil does affect Canadians and the economy in a number of ways. It is important to bear in mind the underlying causes of the current price situation we are facing, whether we are talking about the price of gas, diesel, heating oil, propane, natural gas or any of the other energy products that are part of the energy chain. We all recognize that there is no silver bullet. There is no magic solution that is going to quickly realign international supply and demand and bring prices back down very quickly.

Let me touch on some of the fundamentals of the supply and demand for gas and oil. Clearly, oil is a globally traded commodity. There has been strong demand around the world but it is combined more than ever before with uncertainties about the supply of oil, the reserves and various other shorter term disruptions to supply.

If we go back to January 2002, the world price of crude oil was about $20 U.S. per barrel. Today it is more than $60 per barrel. On a Canadian average basis the retail price of gasoline was 73.2¢ per litre in 2003. Over the first eight months of 2005, it averaged 89.4¢ per litre and of course today it is over $1 a litre.

We hear a lot about the tax issue as one of the drivers of the price of gas and oil, but the reality is that of the 16.2¢ per litre increase between 2003 and the first part of this year, 14.9¢ per litre was crude oil costs. That means that less than a penny, or .8¢ per litre was accounted for by federal taxes. Just half a cent was made up of provincial taxes on average.

If we look at the rise in gasoline prices and we recognize that it has been driven by international market conditions, we should look at those market conditions. Clearly the impact of recent hurricanes on the American oil and gas sector in the Gulf of Mexico was a major factor, but it was a temporary factor.

There are other longer term factors. In fact, the Prime Minister pointed out one of them recently. When he spoke to senior public servants on September 20, he mentioned the major forces shaping the future for Canada and this government's agenda. One of those was the rise of nations such as China and India as global economic powers. He stated:

Consider that in 2004, as measured by purchasing power parity, the United States accounted for about 20% of the global economy with less than 5% of the world's population. Together, China and India also accounted for almost 20% of the world's economy, but with 40% of its population -- so it's clear where the growth potential lies.

It is not just potential. It is happening now as we speak.

It takes a lot of energy to run the factories of China and to get products to markets overseas. It takes a lot of energy to power the growth of emerging consumer societies with a rapidly expanding middle class and populations that strive to achieve the kind of standards that we have in North America. They see energy use as a critical part of achieving those increased living standards.

Since 2001 China and India's demand for oil has grown by more than 2.3 million barrels and that is per day. This accounts for nearly 36% of world oil demand growth during this period. In 2001 China and India accounted for 9% of world oil demand. Today they account for 11% of that demand. It is a trend that will likely continue. That is on top of the growing demand for energy from the traditional high demand industrial economies like Canada, the United States and Europe.

These are some of the fundamental drivers of the rising demand for oil. It drives the demand for natural gas and the products that are made from gas as well, but supply issues are also important. World crude oil production capacity is still exceeding demand, but the gap between supply and demand has been closing in recent years.

The OPEC countries used to have spare crude oil production capacity of between four million and six million barrels per day. They could bring this spare capacity into production in less than 30 days and take the edge off price spikes as a result. Estimates today are that spare capacity is now down to less than two million barrels per day.

Not only is demand rising and supply not keeping pace, but there are other factors. There are a lot of steps in the supply chain between crude oil coming out of the ground and gasoline going into our cars' gas tanks or heating oil going into the tanks in our basements.

Consider the capacity for petroleum refining as an example. Today the refinery capacity all around the world is operating virtually full out. Here in North America both American and Canadian refiners are operating at 97% utilization rates, which for all intents and purposes is operating full out at full capacity. As the demand for petroleum products continues to grow, the refining system's inability to keep pace is going to lead to continued upward pressure on prices.

Why not build more refineries? An important part of the answer has been that these are big and extremely expensive investments. Until quite recently the profit margins in refining were simply not good enough to attract more investment into the refining business. The bottom line is that the refining business is going to have to become more profitable to attract the kind of investment that will be required to increase refining capacity and deal with that weak link in the supply chain.

Many hon. members may ask what the world market has to do with Canada. Are we not self-sufficient in oil and gas? The reality is that we may be, but we represent only 3% of the world's crude supply and that really means we are a price taker. We cannot affect the world price.

Hon. members will have suggestions tonight as to what we should do about this situation. I want to talk a bit about price monitoring. I am very comfortable working with my colleague, the Minister of Natural Resources, to develop a more transparent, authoritative mechanism for analyzing and keeping track of energy, oil and gas prices in Canada. I am very happy to hear members' suggestions and comments about that. I think it is something that we should consider. Our citizens and consumers and businesses have the need for good information and if we need to create a new mechanism to do that, let us do it.

With respect to competition, I have said many times that there have been at least five investigations in the last 15 years into the competitive conduct in the gas and oil business. No anti-competitive behaviour has been found.

Clearly, I believe that Bill C-19 which is before the House would help us with administrative monetary penalties. I am open to suggestions from hon. members as to further amendments that we could make to the Competition Act, such as giving the Competition Bureau the power to initiate its own investigations without reacting to a complaint. I am open to other suggestions as to what we might do with the Competition Act that could be helpful in dealing with this situation on behalf of Canadians.

[David Emerson, Liberal, Minister of Industry]

Mr. Speaker, I hope the opposition supports Bill C-19. If we can amend and improve Bill C-19, we certainly will consider that.

[Paul Crête, Bloc, Rivière-Du-Loup—Montmagny, QC]

Let us talk about transparency, Mr. Speaker. For the past five years, the Bloc Québécois has been asking that the powers of the Competition Bureau be increased to enable it to investigate extensively in the petroleum sector and take action, as required. This bureau's president himself testified before the committee that he lacked the necessary power to take effective action.

Will the government undertake today to amend Bill C-19 so as to provide the Competition Bureau with the effective tools and the powers it needs to act with regard to the petroleum sector?

Main Estimates, 2005-06

[Mauril Bélanger, Liberal, for the President of the Treasury Board]

moved:

Motion No. 1

That Vote 1, in the amount of $125,413,000, under PRIVY COUNCIL — Department — Program expenditures, in the Main Estimates for the fiscal year ending March 31, 2006, be concurred in.

Madam Speaker, I am pleased to take part in this debate in favour of the motion to approve the budget of the Privy Council Office for 2005-06.

I find it unimaginable that anyone could be against passing the Privy Council Office budget and that some hon. members in the opposition intend to obstruct it. This shows a lack of understanding of how the Government of Canada works. Those who oppose passing this budget should take the time to learn more about the basic principles of public administration and government.

The Privy Council Office plays a central, not to say crucial, role in the planning and implementation of major government policies. As a central agency, the Privy Council Office conducts strategic analyses of complex issues and does a thorough review of proposals and government orders as they are presented.

That is what allows the Privy Council Office to advise the government on developing and implementing its policies. It is the central agency par excellence and ensures that the general policy objectives, as set by the government and by Parliament, are met.

One of the most important documents setting out the objectives of the government's policies and its plan of action for achieving them is the throne speech. It is not surprising, therefore, that the Privy Council Office and particularly the Clerk of the Privy Council are closely involved in preparing the throne speech as advisors to the government on the aims of its policies and its plan for implementing them, in close cooperation with the PMO.

It may rightly be said that the throne speech is the equivalent of a bible for the PCO, as for the whole of the government apparatus. It reflects the government's vision of the type of Canada it hopes to build through the policies and programs contained therein.

There is another analogy, which perhaps better explains the link between the PCO and the throne speech. The throne speech becomes a sort of routing slip. It defines the government's legislative program and the commitments to be met. It is in this statement that the PCO and the rest of the government machine find their routing slip. The PCO ensures the work is carried out.

It will be remembered that the October 2004 throne speech dealt with a number of broad themes, namely a vigorous economy; the health of Canadians; children, caregivers and seniors; native Canadians; cities and communities; our environment; an influential role of pride in the world and governing with a common goal.

With your permission, I will describe some and, if time permits, each of them, bearing in mind that I do not have time here to mention all the objectives the government presented in each case. We have either accomplished or are on the way to accomplishing many more than what can be mentioned in a single speech.

What I want to get across to my colleagues opposite—in case some have not yet grasped it—is that the PCO was closely involved in defining each of these strategic objectives. It would be unrealistic to think that a government can successfully manage such a large range of problems without drawing on the PCO's functions of analysis, coordination and critical examination.

So I will start with a vigorous economy.

The current government is working to lower the debt-to-GDP ratio to 25% within 10 years, a goal it reiterated in the 2005 budget along with its ability to reach that goal.

We said that we would review the expenditures and reallocate the resources as needed. The 2005 budget confirmed that the expenditure review committee has identified nearly $11 billion in cumulative savings over the next five years, which will be reinvested in core federal areas of responsibility.

The first part of our five-point economic strategy—building a highly skilled workforce, promoting learning in the workplace and updating labour market agreements—is on track, as the 2005 budgetary statement confirmed.

We announced the implementation of an action plan on labour market integration of immigrants trained abroad. This plan allocates financial support to facilitate the foreign credential recognition process, provide immigrants with better language training and develop a portal so future immigrants can better prepare for their integration into Canada.

There is also the learning bond program—an innovative incentive to encourage low-income families to save for their children's education—funded with money set aside in the 2004 budget and which is supposed to begin on July 1. We also improved the program so as to introduce more people to the registered education saving plan and encourage low-income families to take advantage of it.

The second part of our five-point economic strategy is also progressing rapidly. The National Science Advisor was appointed to help universities, colleges and businesses renew their commitment to establishing a real national science program.

The third element of our five-point economic strategy, which deals with a smart regulatory system, was proposed by the External Advisory Committee on Smart Regulation; it provides for a transparent and predictable regulatory system. Work in this area is being pursued at the cabinet committee responsible for domestic affairs. Bill C-19, to amend the Competition Act, has already been introduced in the House.

The fourth element, which is the reform of the equalization program, has led to the adoption of a new framework for equalization and territorial formula financing. Under that new framework, federal support will be increased by $33 billion over the next 10 years. Legislation on the reform of the equalization program is currently before the House in the form of Bill C-24.

We promised a strategy for the north, a first in Canadian history, and we have started work on developing that strategy.

The fifth element includes the promotion of investment through the adoption of a sound monetary and fiscal policy and a competitive tax system.

The implementation of this sound monetary and fiscal policy has already been completed. The 2005 budgetary statement provides for balanced budgets through 2009-10. The 2004-05 fiscal year marked the completion of the five-year tax reduction plan totalling $100 billion, which was announced in 2000. The 2005 budget contains measures to reduce the general corporate tax rate to 19% and to eliminate the corporate surtax.

Another aspect of the fifth element of our five-point economic strategy consists in building on the Smart Borders initiative to strengthen security in North America while facilitating the flow of goods and people across the border.

Let me turn now to the health of Canadians. Long before last week's Supreme Court decision, this government set out an ambitious, yet absolutely crucial, set of policy deliverables to ensure that Canadians would have the timely and quality health care they deserve.

This complex set of policy goals includes: reduction in wait times; establishing a requirement for evidence based benchmarks; comparable indicators; clear targets; and transparent reporting. It also includes an increase in the number of doctors, nurses and other health professionals; improved access to home and community care services; improved access to safe and affordable drugs; setting goals and targets for improving the health status of Canadians; an annual report on the health status and health outcomes; the promotion of healthy living; enhancement of sports activities at both the community and competitive levels; and health protection. It also includes working with provincial and territorial partners on reforms and long term sustainability of the health system and on health promotion.

The cornerstone of our health care agenda is the government's commitment at last September's first ministers meeting of $41.285 billion over 10 years. Budget 2005 will implement the first year of the funding commitments related to the 10 year plan to strengthen health care.

As regards reductions in wait times, budget 2005 provides $15 million over four years for wait times initiatives. The provinces and territories are engaged with the federal government on developing a process for wait time reductions.

Budget 2005 also provides $110 million over five years to improve the data collection and reporting of health performance information; $75 million over five years to integrate internationally educated health care professionals; $170 million over five years to help ensure the safety and effectiveness of drugs and other therapeutic products; $300 million over five years to encourage healthy living, and prevent and control chronic disease; and finally, increased funding for Sports Canada to $140 million annually.

This funding builds on the additional $2 billion health care transfer to the provinces provided for in budget 2004 through Bill C-18.

The next theme in the government's agenda that I would like to address concerns children, caregivers and seniors. As members know, this government has placed very strong emphasis on children and the need for a national system of early learning and child care. We spent the day debating that.

Budget 2005 provides $5 billion over five years to help build the foundations of such a national system. To date, we have signed bilateral accords to support the development of early learning and child care with Manitoba, Saskatchewan, Ontario, Newfoundland and Labrador, and Nova Scotia.

We have concluded an agreement with the government of Quebec to enable that province to establish its own parental benefits plan, with the federal government providing a one time start-up fund of $200 million and an annual premium reduction of approximately $750 million for the government of Quebec to use toward its plan.

Let me turn to our commitment to improve tax based support for Canadians who care for aged or infirm relatives or those with severe disabilities. The overall commitment of the federal government is $1 billion over five years. Budget 2005 is the first step toward a more comprehensive strategy to support unpaid caregiving.

Acting on the recommendations of the technical advisory committee on tax measures for persons with disabilities, budget 2005 proposes to increase tax relief for persons with disabilities by $105 million in 2005-06, growing to $120 million by 2009-10. In fact, with budget 2005 the government is acting on virtually all of the committee's recommendations.

It is important to note the impact of the reduced tax burden on low and modest income families which budget 2005 announced. By 2009 the amount that an individual can earn tax free will increase to at least $10,000 and most of the benefit will go to those with low and modest incomes.

The Speech from the Throne committed the government to do more for Canada's seniors. Specifically, it committed the government to continue the new horizons program and explore other means of ensuring that we do not lose the talents and contributions that seniors make to our society.

In the February 2004 Speech from the Throne, the government announced a new deal for Canada's cities and communities. The government also established a new secretariat for cities and a new federal department of infrastructure and communities. We said we would make available a portion of the federal gas tax to municipalities to enable the containment of urban sprawl and to invest in new sustainable infrastructure projects in areas such as transit, roads, clean water and sewers.

Budget 2005 has $5 billion over the next five years in gas tax revenue to be given to the cities and communities. It also adds new funding of $300 million to green municipal funds. This builds on budget 2004 in which the goods and services taxes paid by municipalities were rebated entirely by the federal government

The Government of Canada has now signed gas tax revenue sharing agreements with three governments: British Columbia, Alberta and Yukon. Two more are anticipated before the end of this month. They are with the governments of Ontario and Quebec.

In addition, the government committed to move quickly to flow funds within existing infrastructure programs. Significant infrastructure investments have been announced. There is the $1 billion funding package for the Toronto Transit Commission; $500 million for the expansion of the Vancouver Convention Centre; and significant projects undertaken at major Canada-U.S. border crossings such as Windsor-Detroit.

We have reached agreements with Quebec on financially supporting Quebec municipalities with the challenges of renewing their infrastructure; with Ontario in support of improvements to Ottawa's public transit system, and of course with the expansion of the Congress Centre also in Ottawa; and with Prince Edward Island on infrastructure funds for P.E.I. communities.

Other policy deliverables by the government to support and improve the quality of life in our cities and communities include the affordable housing initiative, the supporting communities partnership initiative for the homeless and the residential rehabilitation assistance program.

I may not have time to deal with the initiatives that we have taken on the environment and the numerous initiatives we have taken on Canada in the world.

I would like to provide an overview of the government's agenda as it relates to a role of pride and influence for Canada in the world. The government promised and released a comprehensive international policy statement which provided an updated and integrated approach to Canada's foreign policy objectives: trade and investment needs, defence requirements and the development assistance program.

One of the first actions of the government after the February 2004 Speech from the Throne was to develop and approve Canada's first ever national security policy. Considerable work has been undertaken since then in implementing the new security policy and a progress report on implementation to date will soon be released.

The government established a cabinet committee on security, public health and emergencies and has appointed a national security adviser to the Prime Minister. Separate legislation to create the Department of Public Safety and Emergency Preparedness has been passed and the new Canada Border Services Agency legislation is before Parliament.

We have taken steps to build a more sophisticated and informed relationship with the United States. As part of the new enhanced representation initiative, the new Washington secretariat has been established and has commenced operations. Other projects are under way to advance advocacy, support policy coherence and share information among all levels of government.

Earlier this spring the Prime Minister, President Bush and President Fox announced the security and prosperity partnership launching a series of negotiations among the three countries on key aspects of security, prosperity and quality of life for North Americans.

On the defence front, our chief policy deliverable was to invest more in our military. Budget 2005 provides $12.8 billion in new money for defence over five years. It provides $3.2 billion over five years to strengthen military operations by improving training and operational readiness, enhancing military medical care, addressing critical supplies and repair shortages, and repairing infrastructure.

We have promised investments in key capital equipment, for example, new armoured vehicles and replacements for the Sea King helicopters. Budget 2005 provides more than $2.7 billion for new medium capacity helicopters, utility aircraft and military trucks.

We are increasing regular forces by 5,000 and the reserves by 3,000, and training regional peacekeepers, such as in Africa for the African Union mission in the Darfur region of Sudan.

The February 2004 Speech from the Throne promised the creation of the Canada Corps to help young Canadians participate in international assistance; provide to developing nations Canadian expertise and experience in justice, in federalism, in pluralistic democracy; and to bring the best of Canadian values and experience to the world.

The new Canada Corps was mobilized successfully and effectively for monitoring the elections in Ukraine last December, which we all remember with great pride.

Budget 2005 commits to doubling aid to Africa by 2008-09 from its 2003-04 level. It also provides additional funding to combat disease in developing countries and $3.4 billion over the next five years in increased international assistance. We are maintaining Canada's leadership role in the creation of a new international instrument on cultural diversity and continue to participate actively in a number of international organizations, be it the Commonwealth or the Francophonie.

This is not the complete list of the government's policy goals and the actions we have taken to achieve them. In each and every item that I have described to the members in this House, the Privy Council Office is right there helping to analyze and develop the policy, challenge any weakness, exert due diligence, bring together disparate parts from across the breadth of government, tie together the loose ends and manage the preparation of legislation and its follow-up.

In short, the Privy Council Office is engaged in all aspects of the cabinet's work in governing the country. Voting against the motion to support the approval of the Privy Council Office budget for fiscal year 2005-06 would cause considerable damage to the functioning of government as a result. It would most certainly be against the interests of all Canadians.

I therefore encourage and exhort all hon. members of the House to do the right thing and to vote in support of the motion. To do otherwise would be unconscionable. It is rather surprising that we would be confronted with a motion that would remove the entire funding for the Privy Council Office. It is a demonstration of a lack of understanding of how government functions.

In concluding my remarks, and I know I will have occasion to answer some questions if there are any, we definitely urge all members of the House to consider seriously the implications of not supporting this motion, which is central to the ability of government and Parliament to function.

Gasoline Prices

[Jerry Pickard, Liberal, Parliamentary Secretary to the Minister of Industry]

Mr. Speaker, I welcome this opportunity to address Motion No. 165 now before the House. It contains two distinct proposals. One concerns the establishment of a petroleum monitoring agency and the other concerns unspecified amendments to the Competition Act. I will address each proposal in turn.

The first proposal is not novel in any way. As everyone in this place recalls, the petroleum industry has been monitored many times over the last several years and we have found through that monitoring that there are high and low fluctuations.

Following studies of the gasoline price increases during the winter of 2003, the Standing Committee on Industry, Science and Technology recommended the establishment of a petroleum monitoring agency to be responsible for the collection and dissemination of data on gasoline pricing.

The committee's report found that significant increases in prices had been as “the result of competitive reactions to a series of international crises and abnormally cold weather that gripped northeast North America last winter”. Furthermore, the report also found no evidence that prices were being fixed or that market participants were engaging in any anti-competitive business practices.

The purpose of this report and the committee's recommendation was to increase the awareness of consumers regarding the dynamics of gasoline pricing and the competitive nature of Canada's petroleum industry. Members on this side of the House would agree that it is important to make information about the setting of gasoline prices widely available to the public.

However, we do not believe that an independent petroleum monitoring agency is necessary to accomplish this objective. Establishing a government agency charged with monitoring gasoline pricing may create a perception that the federal government is regulating gasoline prices. Retail price regulation is by and large the jurisdiction of provincial governments.

Also, current government activities, coupled with the data on gasoline prices collected and disseminated by the private sector and provincial governments, represent the most practical and cost effective means of raising consumer awareness about the competitive nature of Canada's gasoline industry.

Moreover, the Competition Bureau already exists to promote and maintain fair competition in all sectors of the economy, including the petroleum industry, by educating businesses and consumers, promoting compliance with the Competition Act and taking enforcement action when necessary.

In the past 15 years, the Competition Bureau has conducted five major investigations into allegations of collusion in the gasoline industry. The most recent one concluded in March of this year. Each time it found no evidence to suggest that a rapid rise in retail gasoline prices resulted from a national conspiracy to fix prices.

Establishing a gasoline monitoring agency will not do anything to further the objective of inspiring public confidence in Canada's competition framework.

That being said, we think this Parliament can do more for consumers than simply create a petroleum monitoring agency. That is why in November 2004 we tabled Bill C-19, an act to amend the Competition Act in Canada.

This bill represents a necessary step in strengthening Canada's competition framework so that it can adapt and respond to the rapid pace of economic change in the 21st century. By strengthening Canada's Competition Act, we can ensure that consumers have confidence not only in the competitiveness of the petroleum industry but in all sectors of the economy.

Bill C-19 follows extensive consultations with the public, including large and small businesses, consumer advocacy groups and legal and economic experts. The proposed legislation would provide concrete measures to address their concerns. Bill C-19 would give the Commissioner of Competition the authority to seek restitution for losses of consumers resulting from false or misleading advertising.

It also would increase the level of administrative monetary penalties imposed for deceptive marketing practices and introduce administrative monetary penalties to address the abuse of dominance in any industry, including all sectors of the petroleum industry.

This legislation would repeal the criminal pricing provisions dealing with price discrimination, geographic price discrimination, predatory pricing and promotional allowances. These pricing behaviours would be addressed under the abuse of dominance provision with the administrative monetary penalties.

The bill would also return the Competition Act to a law of general application by repealing the airline specific provisions of the act which were adopted in response to Air Canada's merger with Canadian Airlines. These measures are necessary to ensure that as an economy grows and evolves the Competition Bureau has the necessary tools and remedies at its disposal to effectively address the anti-competitive business conduct of industries and markets, and to encourage compliance with the Competition Act.

The motion before us proposes the government bring forward amendments to strengthen the Competition Act. As described, we have taken concrete steps to do exactly that. The motion proposes measures to ensure that the competition commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

We believe that the motion is proposing that the commissioner of competition be granted additional authority to conduct inquiries into the competitive nature of the market sectors where there is no reason to believe that the Competition Act has been breached.

While some of the stakeholders support allowing these types of general or market inquiries in recent national consultations, many raise serious concerns regarding these proposals, such as the types of procedures that would be used, the length of time they would take and how much they would cost.

The Competition Bureau is carefully examining the concerns raised by stakeholders regarding these market inquiries. Similar initiatives have found some support in jurisdictions, such as the United States, the United Kingdom, among others. The Competition Bureau is looking into the approaches taken by these countries to determine if these types of inquiries should be incorporated into our competition framework, while addressing the concerns of Canadian stakeholders.

We urge the members of this House to allow the Competition Bureau to complete its work on the issue so that we can ensure all proposed amendments to the Competition Act are carefully considered and well measured.

All factors taken into account, there is no evidence that a petroleum monitoring agency is needed or even desirable.

Furthermore, as the motion does not address the serious issues, such as jurisdiction of the provinces over gasoline pricing, and as we have already tabled Bill C-19, I urge all members of the House not to support the bill.

Budget Implementation Act, 2004, No. 2

[Bill Siksay, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I am pleased to rise and speak to Bill C-33, an act to implement certain provisions of the budget tabled in Parliament on March 23, 2004.

I am pleased, but a little surprised that we are still dealing with last year's budget, particularly since we heard the budget for 2005 earlier this week. It was noted with some amusement by other members this morning when the Clerk called the debate on last year's budget. That is not to trivialize the importance of what is in this bill. Bill C-33 is a large bill that contains quite a number of measures and some of them are very important.

Bill C-33 contains a number of changes to other legislation.

Part 1 deals with amendments to the Air Travellers Security Charge Act to reduce the amounts charged to airline passengers under that act. It is probably a good thing to do, but I do have a general caveat around user fees.

When we put off the collective responsibility through our taxation system for things such as air travel security to user fees, it is a way of adding the tax burden on to individuals. We avoid our collective responsibility there. It is also a way of governments announcing tax cuts and then shuffling the real burden and increasing taxes in other very specific kinds of ways. It is not something that I generally support. I do raise a caveat about it, although reducing it I suppose is a good thing.

Part 2 of the bill amends the First Nations Goods and Services Tax Act to facilitate the establishment of taxation arrangements between the government of Quebec and interested aboriginal nations in Quebec. I hope that takes place. It is good to facilitate agreements between our governments and our aboriginal nations.

Part 3 of the bill has many changes around the Income Tax Act and related acts. These include things such as introducing a new disability support deduction and improving the recognition of medical expenses for caregivers.

Clearly, there are new measures in the new budget earlier this week to do better on those provisions. Probably what we are debating this morning did not go far enough and needed to be improved. In the more recent budget we have upped that, which is good. I suspect we could still go some way to improve the situation of people with disabilities and the people who care for those who have medical health problems.

The bill also addresses expanding the education tax credit to apply to the cost of an otherwise eligible course taken without any reimbursement in connection with an office or employment. It accelerates the 2005 increase in the small business deduction threshold to $300,000. There are a whole series of measures, including things such as limiting the period during which taxpayers may open up old income tax returns to 10 years, preventing the use of schemes to sell otherwise unusable charitable donation tax credits and introducing a new regulatory regime for registered charities. Those are some of the provisions in the bill. There is quite a number of measures in the bill.

There are many important things in the legislation.

One particular measure I want to talk about is something for which the New Democrats have been calling for a number of years. It is with some pleasure that it has finally sunk into the consciousness of the government and it appears in the legislation, and it appeared in the budget last year.

Hopefully not, but probably because we were coming up to an election and this was such a glaring example of a failure of government policy, the government took the opportunity to make this change. The change I want to talk about is the elimination of the deductibility of fines and penalties.

This glaring loophole of avoidance of responsibility and tax responsibilities has been raised a number of times over many years. Members in this corner of the House have over the years called the provision perverse, outrageous and absurd. I have to agree that it is perverse, outrageous and absurd that corporations could deduct fines for criminal activity or for environmental violations and chalk it up to the cost of doing business. Somehow that flies in the face of what a fine or a penalty is.

A fine or penalty tries to seek some kind of corrective action, not provide another opportunity for a deduction against corporate taxation or taxes to be paid. This is an incredibly important issue, so I am glad it is finally being addressed. However, I wonder why it took so long to do so.

Bill C-19 deals with amendments to the Competition Act and includes changes to the fines levied against corporations for a wide variety of anti-competitive offences. However, in the committee my colleague from Windsor West felt that it would be inappropriate to deal with the changes to the Competition Act before we dealt with the change to the taxation laws. The cart was being put before the horse. Thankfully, the committee was moved by that argument and agreed to put off consideration of the legislation until we dealt with this matter.

This is an important issue for the folks who are looking at the Competition Act. If the fines and levies in reference to anti-competitive offences do not have any real effect, then why deal with them. The committee made a good decision, and I am glad the NDP member for Windsor West raised the issue.

Some examples of the kinds of situations that this has led to are really absurd, perverse and outrageous, as I said earlier. One of those examples is a pharmaceutical company was fined $50 million in September 1999 for a variety of conspiracy offences related to the sale of some of its products. That company was able to deduct no less than $10 million or 21% of the fine from its total taxable income. It is unbelievable that somehow the penalty was turned to an advantage for this company. That it got any advantage from being fined for conspiracy related to the way it did its business is a crazy situation. Therefore, it is good that the legislation finally addresses this.

New Democrats have raised this. The member for Winnipeg Centre, the member for Windsor—Tecumseh, the member for Winnipeg North have all raised this issue over and over again, in 2002, 2003 and 2004. All pointed out the absurdity of this situation.

If I get a parking ticket, which I did a couple of weeks ago as I rushed off to an event and forgot to put money in the parking metre, I cannot deduct it from my income taxes. It is outrageous that a business or corporation can deduct fines it encounters in the misconduct of its business. To chalk up fines and offences that way should not be another cost of doing business. It is good that we are finally dealing with this. I cannot believe it took so long, but there is certainly some benefit to it, This has been a glaring example of some of the problems with our taxation system.

When I look back at the budget in 2004, I remember that budget seemed to be about tax cuts and debt reduction. The whole social deficit, the important social spending was ignored again in that budget. We did not need a year ago, just like we do not need now, budgets that ignore the important social issues and concerns, budgets that do not invest in the future of needs of Canadians to improve their quality of life.

The budget of last year was a blatant example of focusing almost entirely on tax cuts and debt reduction. I am glad we have seen a bit of a change this year with the most recent budget. At least there is some reflection that the government is in a minority position in the House and it took a broader perspective on the important needs of the country.

We found out last fall that the surplus projections of the government were completely wrong, which is a continuing trend. The surplus projections of the government have been wrong for a number of years in a row, and by whopping margins.

Last year the government predicted a surplus of $1.9 billion and in the end it turned out to be a $9.1 billion surplus. It shakes our confidence in the ability of the government to do the whole budgeting process. If it cannot get the figures right on what money is coming in, how can it make appropriate decisions about where that money should be spent and what the important expenditures are from year to year? How can the government determine appropriate priorities when it does not really know what is coming in?

Last year was a particularly blatant example of that where incredibly important needs of Canadians were ignored in the budget, yet as it turned out the numbers were based on a faulty projection of the surplus that year. The government could have done a lot more in the budget of 2004 than it did. I hope measures are in place to ensure that down the road it does not make those kinds of mistakes and that it can restore the confidence of Canadians in the budget process.

By focusing on debt reduction and tax cuts, important things were left out of the budget. The government promised for years to address the issue of child care, for instance, and last year's budget did not do that. Yet again for over a decade the promise of the Liberal government to deal with child care was missed. We know something not good enough happened this week, but at least it made it on to the list in this new situation in a minority government.

Last year's budget did not deal with the issue of housing. It did not deal with the issue of student debt. It did not really deal with the issue of poverty in Canada, of child poverty and families living in poverty. I want to talk a bit about some of those issues.

In my riding of Burnaby--Douglas, affordable housing is a crucial issue. During the last election, I campaigned hard on the fact that we needed more affordable housing in our community. Burnaby--Douglas had done very well back in the 1970s and 1980s when Canada had a national housing program. We did very well in terms of the kind of affordable housing which was built in our community. Co-op housing was a major component of our housing stock. Co-op housing is an excellent model of communities and people of mixed economic backgrounds living together and working together to maintain and manage their homes. It makes an incredible contribution to community life and to the overall community. There are a number of fabulous housing cooperatives in my riding.

We need a program like that and we still do not have it. We did not have it in the budget of 2004. We did not get it in the budget of 2005. I know some of my constituents are very disappointed that this did not happen. They know people in our riding are paying way too much for housing. People on the lower end of the economic scale are spending way too much of their available income to be housed in often substandard housing. We need better housing, more appropriate housing and affordable housing in our community.

I represent a community that is generally seen to be a fairly well off community, but the poverty in my community is very well hidden. Almost 30% of people in the city of Burnaby live in poverty. It is a tribute to the caring for people in the community which sometimes makes it appear invisible. This community, like all communities in Canada, has a crying need for more affordable housing. We did not get that in 2004 when more corporate tax cuts and debt reductions were the order of the day and investing in the future of Canadians fell by the wayside. Unfortunately, in 2005 it is the same story on affordable housing.

Students in my riding were really concerned about the budget in 2004. There were no measures in it to address the incredible $20,000 to $25,000 average debt loads that students face upon graduation. That limits the ability of students to undertake post-secondary education.

The cuts in transfer payments to the provinces which were made the Liberal government years ago, and which have not been restored, have forced up tuition fees, making post-secondary education unaffordable for many students and their families. That is a huge issue in my riding. Burnaby--Douglas has two fine post-secondary educational institutions: Simon Fraser University and the British Columbia Institute of Technology. We depend on students being able to attend those institutions. We want to ensure that they have access to them.

Families in my riding want to make sure that their children can get the best possible education so that they can succeed in life. That is very important to people in my riding. It is very important to new immigrant families in my riding. They very strongly believe in the importance of education and want to make sure that their children succeed in their new country.

This is an important issue. The 2004 budget did not deal with it. The 2005 budget dealt with one aspect. In the 2005 budget a student loan is forgiven if the student dies or is completely disabled. That hardly addresses the situation. It is a good measure, but students are literally dying to get help and the government is saying that they really do have to die before they get any assistance with their post-secondary education. That is not acceptable.

The Simon Fraser Student Society has decided to pursue this issue. It has been trying to be very creative about how it pursues the responsibility of the federal and the provincial government in British Columbia for post-secondary education.

Recently the society launched a complaint with the United Nations saying that both Canada and British Columbia are in violation of the United Nations International Covenant on Economic, Social and Cultural Rights which was approved back in 1976 and which Canada signed at that time. Article 13 of the agreement calls for the progressive introduction of free education as a means to achieving equal access for all.

I think everyone in the House knows that we have been going in the opposite direction on free education. Education is becoming increasingly expensive. Tuition rates have gone up 75% to 150% in British Columbia. A significant part of the reason is that the federal government cut the transfers to provinces for post-secondary education.

I am proud that the previous NDP government in British Columbia put a freeze on tuition fees during its term so that students did not face ever increasing tuition fees. The NDP put on that freeze in the face of the decrease in transfer payments, the shortfall in money that the province received from the federal government. The B.C. government made education and health care a priority during the difficult period when funding from the federal government was cut because of the social transfer payment cuts to the provinces.

I am proud that the New Democrats held the line on that. As soon as the NDP was out of government and the Liberals were back in, tuition fees shot up dramatically. That is an unacceptable situation.

I strongly support the Simon Fraser Student Society in its attempt to bring attention to Canada's failure to move toward free education and improved accessibility to education. It is a very important issue and one on which Canada should be leading the world, not struggling to catch up with other countries that are making important strides in this area.

Last year's budget and this year's budget have done little for people living in poverty in Canada. We have heard how EI continues to suck money from workers and employers, but it is not being put back into programs for workers in Canada. We need to reduce the threshold for qualifying to 360 hours from 720 hours. That change is long overdue. The money is there to do it. There is no excuse. That move would go a long way to reducing poverty for families and children in Canada. EI is not just an insurance program; it is a key part to reducing poverty in this country.

The new budget increases the basic personal tax exemption. That is touted as a measure to help low income Canadians. I suppose it provides a small measure of support for those people, although it is hard to imagine how somebody who is only earning $11,000 a year should be paying any income tax. It is a very small measure. Unfortunately, proportionally it benefits high income Canadians far more than it benefits low income Canadians. We need to target our tax measures a little more carefully around eliminating poverty than we have been doing.

Mr. Speaker, I see you are indicating that I should be wrapping up my speech. I will say it has been interesting to speak to last year's budget when we are already dealing with the budget for the coming year. It is time to get on with it.

I am glad that finally after years of pressure from New Democrats in this corner of the House the government has finally sought to eliminate the deductibility of fines and penalties. That is a good part of the bill. With that I will close my remarks.

Gasoline Prices

[Paddy Torsney, Liberal, Burlington, ON]

Then, Mr. Speaker, I would encourage members to look at the changes to the Competition Act that are currently proposed by the Minister of Industry. These are important changes which will make sure that we have the best possible Competition Act, because it is in industry's favour to make sure that it is being held to the highest standards. More important, it is in Canadians' and consumers' favour to make sure we have a Competition Act that serves the interest of consumers in Canada and makes sure they have the safeguards to protect their rights.

This proposal should be considered by the Standing Committee on Industry, Natural Resources, Science and Technology during the hearings on Bill C-19, but until the research is done and the possible implications are clearly understood I do not think the motion before the House today should be supported.

[Paddy Torsney, Liberal, Parliamentary Secretary to the Minister of International Cooperation]

Mr. Speaker, I am thankful for the opportunity brought forward by Motion No. 165 to address the issues of competition, particularly in the gasoline sector.

The second part of the member's motion proposes that the government bring forward amendments to strengthen the Competition Act, including measures to ensure that the competition commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

The challenge of the motion, of course, is that it is not at all clear what kind of amendments it is proposing. While it proposes amendments to strengthen the Competition Act and provide some non-inclusive list of examples, these examples refer to powers that already rest with the Commissioner of Competition.

Currently, as the member for Edmonton—Leduc has identified, if the commissioner has reason to believe that an offence has been committed under the Competition Act or that grounds exist for the making of a remedial order by the Competition Tribunal, she can, subject to some qualifications, “launch investigations, summon witnesses and ensure confidentiality”.

In the past, some members of the Bloc Québécois publicly indicated that they wanted to amend the Competition Act so that the Commissioner of Competition would have the power to conduct inquiries into markets and examine competition issues even if there was no reason to believe that an offence had been committed. I have some problems with that.

A study of the gasoline industry, which has been cited by some Bloc Québécois members, is an example of when such a power would be useful. Since the introduction of the motion refers to gasoline specifically, the member must realize that the issues they address would apply in a more general nature to the entire market and the potential for the commissioner to launch investigations in all areas of competition.

The first issue raised that must be addressed is that while some competition authorities in other countries, such as the U.S. and the U.K., found that these kinds of general or market inquiries were useful tools that we should look at that, I really think there needs to be appropriate checks and balances.

In the 1980s, for instance, a gasoline study was conducted by the Restrictive Trade Practices Commission in Canada. It gathered over 200 witnesses and the study took five years to complete. This has enormous cost implications for all of us.

I would also suggest that the example of the gasoline inquiry highlights the need for safeguards that could help ensure that the inquiries are initiated only when there is information suggesting legitimate competition issues that could be addressed by the inquiry.

While the member opposite has suggested that there is some kind of collusion going on between the Conservatives and the Liberals on this issue, let me say that the member for Edmonton—Leduc and I sat on a committee. The committee wrote a report to which I would refer the member opposite. All of us sat around the table and none of us got together out of some kind of crazed idea of colluding, but in fact because we had studied this issue and examined the facts.

There have been many studies on gasoline prices and all have concluded so far that there is no evidence of price fixing or other types of anti-competitive conduct that would substantially lessen competition.

The report that I referred to entitled “Gasoline Prices in Canada” by the Standing Committee on Industry, Science and Technology in November 2003 represents one of the most recent studies. In our report, the committee indicated that it was satisfied that the Competition Bureau was adequately overseeing competitive aspects of the petroleum industry. Based on information, as the member opposite has suggested, from the International Energy Agency, Canada's retail gasoline prices have consistently compared favourably to other major industrialized nations.

This brings me to a second issue. I am always concerned about any cost inputs to any aspect of Canadian industry. I am concerned when gas prices go up and small business operators who have to deal with high input costs have to face these issues, but let us also look at the other side of this. Sometimes higher gas prices help people look at other options, like public transit.

One of the more recent blips in gasoline prices, I read with astonishment, is that young are making absurd claims in the newspaper like, “At this rate it hardly justifies having a car”.

However, maybe people do need to think about the choices they make. If somehow the change in gasoline prices makes people think twice and makes them wonder about buying an energy efficient car or taking public transit, I would be quite excited about that. I just bought a hybrid and I am happy with my car choice because it is showing by example. I bought the Honda Accord hybrid and of course Honda has a vibrant plant in Ontario.

I would also draw the attention of the members opposite to Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts. The bill, already before the House, followed extensive national consultations conducted by the Public Policy Forum, an independent non-profit organization that the government hired to look into this issue. The consultations proved very useful and helped provide a well thought out and balanced package of legislative amendments that addresses the interests of consumers as well as those of small and large businesses.

Mr. Speaker, in the spirit of cooperation could I just seek clarification? If I sit down, does the member opposite get to make a concluding statement?

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Speaker, I thank the member opposite for bringing forward his private member's motion. It is a noble effort, and I would like to speak to it today in two parts.

First, I would like to address Motion No. 165 by addressing the notion of a petroleum monitoring agency. This first proposal calls for the creation of a petroleum monitoring agency that would prepare an annual report on all aspects of the petroleum industry for consideration by the Standing Committee on Industry, Natural Resources, Science and Technology.

The proposal is very similar to a recommendation made by the former Standing Committee on Industry, Science and Technology in November of 2003, at the conclusion of its report on gasoline prices in Canada. The committee's recommendation, however, at that time specifically indicated that a primary role of the agency should be to collect and disseminate pricing data, by removing specific reference to the collection and dissemination of pricing data and by replacing it with a mandate to report “on all aspects of the industry, including how prices are set and competition issues”. The motion suggests an even larger role for a new agency.

Further to this last point, I should note that the committee's report concluded:

In terms of federal government action, the Committee is satisfied that the Competition Bureau has sufficient powers, personnel and resources devoted to overseeing competitive aspects of the petroleum industry.

Based on this finding, I have to ask, why do we need an agency with an expanded mandate to report annually “on all aspects of the industry, including how prices are set and competition issues?”

In particular, in its report on gasoline pricing in Canada, the Standing Committee on Industry, Science and Technology examined a significant increase in the price of gasoline that took place over several months. It found that the price increase:

--was the result of industry participants’ competitive reactions to a series of international crises and the abnormally cold weather that gripped northeast North America last winter. No evidence was presented to the Committee of a conspiracy to raise and fix prices, nor was there evidence presented of abusive behaviour on the part of vertically integrated suppliers in the form of squeezing retail margins to eliminate or discipline independent retailers.

In its response to the committee's report on gasoline prices in Canada, the Government of Canada indicated that it had given careful consideration to the recommendation concerning the creation of a petroleum monitoring agency. Still the government concluded that current activities undertaken by federal and provincial governments or agencies, combined with information collected and widely distributed by the private sector, “provide the most practical and cost-effective method of informing the consumer”.

In summary, there is no evidence to suggest that the creation of a new petroleum monitoring agency, with its inevitable costs, is needed.

Let me turn secondly then to the bill's call for amendments to the Competition Act. The second part of the motion proposes that the government should bring:

forward amendments to strengthen the Competition Act, including measures to ensure that the Competition Commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

The government indicated in the throne speech that it was committed to providing an up to date legislative framework for business, and that it would propose changes to amend the Competition Act.

The government has already acted on the latter commitment. Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts, was tabled in early November of 2004, and referred to the Standing Committee on Industry, Natural Resources, Science and Technology on November 16. The proposed legislation follows extensive consultations with a wide range of stakeholders, large and small businesses, consumers, consumer groups, economists and legal experts to help ensure that the proposed amendments will contribute to a modern competition regime in Canada.

The proposed legislation, which is consistent with the recommendations made by the Standing Committee on Industry, Science and Technology in 2002, includes the following actions.

First, it gives the Commissioner of Competition the authority to seek restitution for consumer loss resulting from false or misleading representations. This will encourage companies to be accurate in their claims. It will allow consumers to get up to the amount paid if they have been duped by false claims.

Second, it introduces a general administrative monetary penalty provision for abuse of dominance in any industry. Currently, with the exception of airlines, the main consequence for abuse of dominance is simply an order from the Competition Tribunal requiring an end to the practice. Under exceptional circumstances, a structural change, such as divestiture, may be required. This amendment represents an additional tool to ensure compliance with the Competition Act.

Third, the legislation also removes airline specific provisions from the act to return it to a law of general application.

Fourth, finally it decriminalizes the pricing provisions dealing with price discrimination, regional price discrimination, predatory pricing and promotional allowances, so they can be dealt with under a civil regime, and this is very important, and the abuse of dominant position provisions of the Competition Act. This means that conduct like predatory pricing will receive the benefit of a full hearing on its likely economic effect. Cases will also be assessed by the Competition Tribunal with a lower civil burden of proof compared to the former criminal burden of proof.

The motion before us is not clear. It does not describe what amendments are being proposed, other than amendments to strengthen the Competition Act.

Let us look at the facts. The Commissioner can currently initiate inquiries if there is reason to believe that an offence has been committed or that grounds exist for the making of a remedial order by the Competition Tribunal. The Commissioner can summon witnesses, subject to judicial authorization; and the Commissioner must keep information confidential pursuant to section 29 of the Competition Act.

While not clear, Motion No. 165 may be referring to a suggestion that the Commissioner should have the power to conduct inquiries into markets or industry practices, even if there is no reason to believe that an offence has been committed when significant competition issues have been raised.

Other members of the Bloc Québécois have publicly indicated that this would represent an improvement to the Competition Act, and have cited a study of the gasoline industry as an example of why such powers are needed.

However, this is the government's experience. Recent nationwide consultations on various options to strengthen the Competition Act included a proposal to allow the Commissioner to ask an independent body, such as the Canadian International Trade Tribunal, to inquire into the state of competition and the functioning of markets in any sector of the Canadian economy. While some stakeholders supported the idea of market or general inquiries, many stakeholders raised strong objections to this proposal.

Serious concerns were raised with respect to procedures, length of time that these types of inquiries typically take and substantial costs likely to be incurred by both government and businesses in inquiries of this nature.

It is my understanding that in response to these concerns, the Competition Bureau is now presently examining the approaches used in other jurisdictions on a comparative basis that have general inquiry powers for competition related issues.

This brings me to my final point. The Competition Act, which dates back to 1889, is legislation of general application which provides a framework within which business can operate. It is important to approach changes to it with very careful consideration and to fully understand the possible implications of proposed amendments. There is no evidence indicating that a petroleum monitoring agency is needed.

Second, if the motion refers to general or market inquiries, I understand that more work is currently being undertaken by the Competition Bureau to resolve issues raised by stakeholders during consultations.

Budget Implementation Act, 2004, No. 2

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, it is my pleasure to rise today in the House to speak to Bill C-33, the budget implementation act. It is very important to look at a number of issues in the bill. There were a lot of issues that went to committee. I know that there is much interest in deciding what is going to happen with our economy. There were great presentations by hundreds of Canadians who submitted documents. It is important to note, though, that a couple of elements make this legislation very significant.

I am going to focus my remarks on a couple of elements, because I believe they deserve some attention and should be noted in this debate at second reading. One of them is an element that should be closed as it is something that is atrocious: the allowing, in business tax deductions, of fines and penalties to be tax deductible. That is going to be closed.

The second relates to the issue of infrastructure in our communities and our nation. I again will discuss, as I have many times, issues related to the crossing at Windsor--Detroit. I will certainly discuss some of the things that are happening now but also how this relates to our budgetary process. That is a moving target; there are a lot of things changing on a regular basis.

First I want to highlight some of the positive things that we New Democrats were very pleased to see in the budget bill. One in particular is the introduction of the closing of that loophole I mentioned, that gap.

It is hard for Canadians to believe this. A corporation could go to court and be convicted of a criminal offence related to polluting the environment, conspiracy related to market practices and a number of serious elements that are predatory not only to Canadian taxpayers but also to other businesses. The government would then go through the process, there would be a review, charges would be laid and a judgment cast. At the end of the day, behind closed doors, an accountant could then deduct those fines and penalties as a tax break.

It is amazing that the process to get here was so difficult. As New Democrats, we want to make this chamber work and we have been doing that in a number of different initiatives. This was very difficult to push through at the end, but I think it is important to talk about the first part of that process.

I do want to recognize the member for Winnipeg Centre, who pioneered this fight. This fight goes back to a time before I was elected to the House of Commons. It goes back to the member's comments in the House of Commons. I will read that question to the House. It will be shocking for Canadians to learn that there was no response until 2005, when we pressured the government to close the loophole:

Mr. Speaker, I cannot deduct my traffic tickets from my income tax yet a recent court ruling says that businesses can deduct fines, penalties and levies as a legitimate business expense. I find this outrageous. Will the Minister of National Revenue agree that it undermines the deterrent value of a fine if a company can write it off as a tax deduction?

That was said by the member for Winnipeg Centre in May 2002.

What we are talking about is the decision that it is a legitimate business expense to poison our water, a legitimate business expense to practice predatory behaviour that costs other Canadians jobs because their company might play by the rules, whether it is safety or product information that is valid as opposed to unfair advertising or practising predatory behaviour on consumers. These fines were a legitimate business expense and could be deducted.

We have not done all the research on this, but we know it has cost us tens of millions of dollars each year. One of the fines that was levied was for $50 million. It was a joint issue related to drug companies that were fined for conspiracy related to bulk vitamins. There were several companies involved. We estimate that from that $50 million they could have had $10 million of taxpayers' money coming back to them. It is a crime that this type of practice was allowed.

When the member for Winnipeg Centre brought this to the government's attention, nothing was done. In fact, he followed that up with this question back in 2002, about six months later:

Mr. Speaker, six months ago I asked the revenue minister to plug the tax loophole that allows businesses to deduct fines and penalties from their income tax as a business expense. Since when is breaking the law supposed to be tax deductible?

It is unbelievable that we still had no movement even then.

We continue to fight as New Democrats on this issue. We continue to raise the consciences of Canadians and make them aware that for this coming tax year they will not be able to deduct fines and penalties. At the same time, Canadians were having to pay more because the government was shovelling the money back to the people who had gone to court, lost a case and had been fined, penalized or had a levy placed upon them. We would shovel money back behind the scenes to them because they had good accountants and because there was no progress made on this file.

What happened here in the House of Commons is unbelievable. The government at the industry committee then introduced Bill C-19 which looked at increasing administrative monetary penalties but still did not fix the loophole.

I was pleased to introduce a motion at the industry committee to suspend deliberations and discussions on Bill C-19 until this gap was plugged. What was amazing was that we found out the legislation to fix this gap, which was again one of the promises in the Speech from the Throne that never reached fruition, was ready but the government refused to introduce the elements to actually cast the last completion to fix this loophole. It was sitting on a shelf gathering dust.

The motion passed, and I must give credit to the Conservative Party of Canada which supported the motion. Although the Conservatives did not necessarily agree with my position that tax deductions on fines, penalties and levies should not be tax deductible, they said that they were quite clear on that but that they were not fully convinced that was their thing. However they said that a promise was made by the government in the Speech from the Throne, that New Democrats had been raising the issue and that the promise should be honoured. The Conservatives were straight up and I give them credit for that. They have accountability. The Bloc Québécois supported it as well.

Do members know what happened? The Liberals on the committee stormed out of the meeting after we got the suspension. I will give credit to the Liberal chair of the committee who did a good job of handling the situation, handling the committee and making sure that we were working together in a non-partisan way. He was also very much interested in a dialoguing with me to get this moving, which was very important.

A week and a half later the government did introduce Bill C-33 and made sure the amendment was in the bill. We then came back to the House of Commons after the break and we are now in the final stages of the bill.

It is because of that that I kept my word as well and in committee this week we agreed to put Bill C-19 back on the table, which is how Parliament should work.

I do not understand why we had to drag the government kicking and screaming to end something that was so egregious for Canadian citizens. Once again I have to say that the member for Winnipeg Centre should be commended for pioneering this fight. It not only has an implication on individuals and the money they will save as taxpayers that will not be shovelled back to people that break the law, it will also set the record straight that if people are going to pollute, if they are going to use predatory practices that affect consumers and other Canadians and they are caught, they will be fined and not be able to get that money back through the back door. This sets an example.

We have seen a couple of vivid examples in the last few days where a special investigation unit of the RCMP has been out on Bay Street with a big van outside offices and securing records because of the potential problems on Bay Street. This is another issue that was behind the scenes. We did not have the van, but unethical practices were happening through the shuffling of paper that at least as Canadians we can say will be completed and finished. We are very proud to be part of that.

The budget is a very important document in terms of the way in which the process is developed and the promises that are made and things that are laid out later.

Another issue that is evolving right now is the importance of recognizing the decisions being made by this nation regarding infrastructure and investment that has already cost us a lot of money.

Forty-two percent of the nation's trade goes through the Windsor-Detroit border. At the present time there is a rail tunnel with a small load capacity which is not being used much right now because it has only a single stack and it needs a double stack to be more efficient. There is a tunnel for cars and trucks but it is predominantly trucks that use it. There is a ferry crossing and there is the Ambassador Bridge. These elements span about two kilometre's over the Detroit River. Forty-two percent of our nation's trade goes along those two kilometres.

The city and county councils of the day have just released a constructive plan from the Schwartz report. The community has struggled a great deal to find a solution to the gridlock and to ensure the proper infrastructure is in place. Many different community groups have been seeking solutions to this gridlock because it not only has an impact on the air quality, it also has an impact on the community in terms of travelling from the east side of the city to the west side. It is also having an impact on international trade and is prohibiting business development in the community.

The city has come up with a consensus on the problem but it is a problem that requires infrastructure dollars. I will remind the House that the Prime Minister promised that he would look for a solution but that he would not impose anything on the City of Windsor. What the Prime Minister needs to understand is that words are not good enough. Any action that has to be taken must also come with the resources.

After many months of study the Schwartz report is finally finished and now we have the bureaucrats suggesting that it might or might not work. That is not good enough. We were told that appropriate resources would be provided for this.

Let me put the importance of 42% of the nation's trade going through this corridor into context. There has been no infrastructure investment of any significant magnitude in this corridor since NAFTA. Despite all the growth, despite the years and years of warnings from the councils to the former minister of finance, now the Prime Minister, and finance ministers after him, and despite all the county and city resolutions, no action has yet been taken.

As a result, a report was released this year from the Michigan department of transportation that calculates that this year alone the Canadian economy lost $18 billion from delays at the border; double the surplus. We know that the auto plants and parts manufacturers are coming up with other options because of this infrastructure deficiency.

It is interesting to note that the city came back with a consensus report. What had happened was that the federal Liberal government, along with the provincial Conservative government at that time, behind closed doors, attempted to impose something on the community called a nine point plan. They tried to shovel taxpayer dollars to private companies to promote their advancement of solutions that would not work and had no modelling or grounding as solutions.

Our community fought that plan. We exposed its weakness not only in the planning but in the process. The governments had breached the trust of every resident of the city. There was no solution. They were just trying to seek taxpayer dollars. The city was asked to come up with a solution so it hired the brightest traffic guru in North America, Sam Schwartz, a former New York City traffic commissioner, to do a study and come up with a report, which he did. They have consensus for the first time. The warden and the mayor deserve credit for that.

It is not the perfect solution that I would have liked, nor is it everything I was seeking, but it is something. It actually has traffic modelling and it has an actual plan that is multi-model, that will carry the day and that will rebuild confidence.

However the plan will cost money. It has been estimated that it will cost about $1 billion to carry out that plan. Nothing is wrong with that because $18 billion was just lost last year and it will be lost again this year. I can tell members that if the resources are not there, the communities of Windsor and Essex county will fight something being imposed on them. If somebody else wants to impose something that does not support what the community has asked and advocated for, the timelines better be built in for what we are going to do to protect our community to make sure that it is a healthy and vibrant city, not only for raising families but also for economic development. That is important to note.

Once again the word of the Prime Minister and others was that they would be there. In fact just recently in the House of Commons the Parliamentary Secretary to the Minister of Finance said they would be there when I asked a question. Well they had better be there. We see stories though that give me concern. The Windsor Star reads:

Border money up in air--Federal and provincial politicians will decide within "a few weeks" how much funding will be provided and when construction will begin on the next phase of improvements to fix Windsor's border traffic problems.

That is fine, but I have not heard the political leadership say that the money will be there.

What is interesting about all of this is that on the U.S. side the Americans do not seem to have that problem. I will quote Paul Cellucci:

Cellucci urges border decision: Ambassador says U.S. may split costs:"U.S. Ambassador Paul Cellucci says Washington wants quick approval of a new border crossing between Windsor and Detroit and suggested the U.S. is prepared to split the cost.

He noted Canada and the U.S. have worked out a 50/50 cost-sharing formula to pay for a new bridge being built between New Brunswick and Maine, saying this could be the model for the new crossing under study in Windsor and Detroit to relieve the logjams that plague the countries' busiest border crossing.”

What is amazing and what is not talked about often enough is the fact that this corridor, with 42% of our nation's trade, the busiest and most important corridor that we have, has no coordinating body despite four crossings to get the trucks, people, cars and goods and services across the two kilometres. It is not done like that in Fort Erie. It is not done like that in Niagara Falls. It is not done like that in Sarnia. They have a border authority or a public commission. They at least have something that helps coordinate the long term development of the region, the traffic management, the flow and the infrastructure.

With all the changing legislation coming from the United States, it is more important today because just as important as infrastructure is legislation, programming, staff and technology to move the border traffic through at a good rate.

Why is that not being done in Windsor? Why is it that we are going to let 42% of our nation's trade hang in the balance of chaos and no coordination? Part of the reason is that unlike everywhere else, except for one other place, 24 crossings, which are tunnels and bridges, are held by the public sector. Two crossings are held by the private sector: the Ambassador Bridge and Fort Frances. The other ones are usually owned by state, provincial or sometimes municipal governments. In Windsor our tunnel pays a revenue and a dividend back to the people to relieve taxes as opposed to filling somebody else's pocket.

However in Windsor there has been no comment by the government to date as to whether it will fund the next crossing, which is incredible because we are going to let 42% of our nation's trade become a business for someone to usurp the profits of the auto industry, the agricultural industry and people crossing on a daily basis, as opposed to saying that it is a social and economic conduit between our two nations that should not be a profiteering model, not off the backs of industry and not off the backs of people. It is an important connection link between our two countries.

Those moneys for the border could go toward a solution for the future so that we will not have to dig back and try to find money. This should be done properly. I do not understand why we have been left in this situation. I cannot understand why we would let 42% of our nation's trade be thrown up in the air for the interests of a few as opposed to the benefits of many.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Mr. Speaker, here we are again speaking on the legislation to implement the budget of last year. We have a chance to reflect on the past and make connections to the present process involving prebudget consultations for the next budget. I think the timing is good. It is time to reflect on the past and look to the future.

I want to address one very important issue in Bill C-33. There are many issues to touch on. If one looks at the overall summary of this bill, we are dealing with a couple of dozen specific changes to the Income Tax Act, the First Nations Goods and Services Tax Act, the Air Travellers Security Charge Act, and other statutes as indicated.

There is one recommendation in this package that must be singled out. It is a symbol of an obvious glaring loophole, of a wrong that is in our system today. It took an enormous amount of pressure on the part of members in the House to have corrected. There is one line in Bill C-33 under the summary that says “eliminate the deductibility of fines and penalties”. The words say it all, do they not?

Finally, the government is recognizing the importance of eliminating the fact that one can deduct fines charged against a person from his or her income tax. It is hard to believe in this day and age, is it not? It is hard to believe that up until this very moment it was possible to deduct fines and penalties accrued for wrongdoing because to do so there was a tax benefit from that kind of wrongdoing.

Indeed, we might not even be here today addressing this issue or even debating this bill except for the determination of New Democrats. People will know that many New Democrats have pursued this issue in Parliament in different ways from different vantage points and on numerous occasions.

I want to reference the work of my colleague, the member for Windsor West, who out of concern to finally put an end to the rewarding of corporate corruption with tax deductions initiated the following motion at the Standing Committee for Industry, Natural Resources, Science and Technology. His motion stated:

That this Committee suspend hearings of Bill C-19 until the Government introduces its proposed amendments to the Income Tax Act Section 18 (1) (a) allowing the deduction of fines as a business expense into the House of Commons and Second Reading is completed on the proposed amendments.

Members will know that Bill C-19, which is an act to amend the Competition Act, includes changes to the fines levied against corporations for a wide variety of anti-competitive offences. My colleague from Windsor West felt that dealing with those changes before an outstanding question of deductibility of fines was settled once and for all was putting the legislative cart before the horse. Interestingly, the committee agreed.

Miraculously, here we are debating this long overdue budget implementation issue today instead of some time in the new year. I think it is worth acknowledging the hard work of my colleague from Windsor West and congratulating him for this initiative.

As I said, we have been pressing the government to address this issue for some time. We have been pushing hard to convince this Liberal administration to stop allowing the deduction for corporate fines and penalties. Naturally, we have been appalled, as most Canadians have been, as corporations guilty of any number of offences walk away with a backhanded sort of reward for their wrongdoing.

First Nations Fiscal and Statistical Management Act

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, I am pleased to speak to Bill C-20, the First Nations Fiscal and Statistical Management Act.

Like my colleague from Louis-Saint-Laurent—the Bloc Québécois Indian Affairs and Northern Development critic—who also delivered a speech at second reading on November 19 in favour of this bill, I agree with this act to provide for real property taxation powers of first nations, to create a First Nations Tax Commission, First Nations Financial Management Board, First Nations Finance Authority and First Nations Statistical Institute and to make consequential amendments to other Acts.

This bill essentially provides the first nations with financial management tools. Like many other bills, the bill being presented to this House today is not perfect, but it could help in creating a environment that would help first nations to assume their financial independence.

It was very important for us to support this bill to help the first nations to assume a certain financial independence or least much more than they had in the past.

I sit on the Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources with the hon. member for Louis-Saint-Laurent, and we heard from a number of first nations officials, who supported this bill, not to mention those whom we met privately, as part of our parliamentarian duties.

Everyone knows that the Bloc Québécois cares about the self-government claims of the aboriginals, since we too have many such claims in Quebec. In fact, we prefer the term “sovereignist”. In our opinion, true self-government is achieved when a nation controls all of its economic levers. First nations that will avail themselves of the services provided under Bill C-20 will be able to play a more active role in their economy and promote private investments on their territory. This legislation will give first nations access to tools that are already available to other levels of government and in turn access to financial markets, among other things.

However, we warn the federal government not to succumb to the temptation of using Bill C-20 to opt out of its fiduciary responsibilities towards aboriginal people. It remains the government's job to address inequality between aboriginals and non-aboriginals. I can assure the government that we will keep a close watch.

For the benefit of the public and of those members who may not be very familiar with the bill, I should mention this legislation proposes the establishment of four financial institutions. I will explain them briefly.

The first one is the first nations tax commission, which will replace the Indian taxation advisory board. It will be responsible for the property tax rule approval process, and its streamlining will also help strike a fair balance between the interests of the community and those of taxpayers, when rates are set.

The second institution is the first nations financial management board. The board will set financial standards and provide the independent and professional property assessment services required by first nations that want to take advantage of the borrowing pool of the first nations finance authority.

The third institution, namely the first nations finance authority, will help first nations communities that will adhere to the legislative scheme to issue securities collectively and to raise long term capital at preferential rates for highways, water supply systems, sewers and, of course, other infrastructure projects.

Finally, the first nations statistical institute will help all first nations communities to meet their local data needs, while encouraging participation in Statistics Canada's integrated national systems and their use.

The establishment of a new financial relationship between the federal government and the first nations is nothing new. Already in 1983, the Penner report, a report by the special parliamentary committee on aboriginal self-government, recommended that the fiscal relationship between the federal government and the first nations be redefined. The Royal Commission on Aboriginal Peoples made the same recommendation in 1996. Bill C-20 is a step along the road toward greater economic autonomy for first nations.

Here is a brief historical overview of Bill C-20. Before it established a supervisory structure to administer the new legislation, the Department of Indian Affairs and Northern Development created the Indian Taxation Advisory Board in early 1989. In September 2003, 107 first nations began to tax real property. After the Kamloops amendments, in 1988, if I am not mistaken, a number of events strengthened the existing support for the restructuring of financial relations between the first nations and the federal government.

In 1991, the Department of Finance undertook a review of its policy on Indian taxation and, in 1993, made public the Working Paper on Indian Government Taxation.

In 1995, the First Nations Financial Institute or FNFI was created and, at the instigation of the Westbank First Nation, it was then federally incorporated. The main objective of the FNFI was to provide investment opportunities to first nations in order to ensure long-term financing of their public debt. With the adoption of Bill C-20, the FNFI will become the First Nations Finance Authority, which was discussed a bit earlier in this debate.

In 1995, a round table of representatives from the Department of Finance and the Assembly of First Nations led to the adoption of a resolution on taxation. The following year, the participants at the annual general meeting of the Assembly of First Nations adopted resolution 5/96 supporting the establishment, between the first nations governments and the Government of Canada, of new fiscal relationships based on the principles of flexibility, equity, choice, the assurance of government services comparable to those provided by other governments, economic incentives and efficiency.

The Chiefs' Committee on Fiscal Relations was created two years later to review fiscal relations between first nation governments and the federal government. That is known as resolution 49/98 of the general assembly. It recommended the establishment of first nations financial institutions. In 1999, the Assembly of First Nations expressed its support for this initiative when participants in its annual general meeting supported the creation of the first nations financial authority, and backed the Indian Taxation Advisory Board's efforts to establish the first nations tax commission. Those are known as resolutions 6/99 and 7/99 respectively.

In December of the same year, the federal government and the Assembly of First Nations signed a memorandum of understanding concerning the creation of a national round table on financial relationships, with the objective of establishing solid bases for these relationships through an exchange of information, capacity building and the establishment of benchmarks.

In 2000—we are getting closer—the Assembly of First Nations maintained its support for the creation of the first nations statistical institute and the first nations financial management board, pursuant to resolutions 5/2000 and 6/2000 of the Confederacy of Indian Nations. The general assembly then passed resolution 24/2001 supporting the recommendation by the chiefs' committee regarding the establishment of the four new first nations financial institutions by federal legislation. The legal validity of this resolution was questioned, however, since some people thought that it had not received the support of 60% of those present required, as we know, under the charter of the Assembly of First Nations.

On August 15, 2002, the Minister of Indian Affairs and Northern Development released a draft bill with the intent to carry out public consultations before introducing it in the House. Several first nations then raised deep concerns with the way the bill was written. Of course, the Bloc Québécois shared these same concerns.

As a result, the AFN convened a special chiefs assembly in November 2002 and passed a resolution rejecting the proposed first nations fiscal and statistical management bill. According to Resolution 30/2002, the proposed legislation violated the historic nation to nation relationship, infringed upon aboriginal and treaty rights, and was otherwise so flawed that it could not be corrected by mere amendments.

An additional so-called accommodation resolution was also passed, that is AFN Resolution 31/2002 respecting the right of those first nations to enter into local and regional agreements, but not in the context of national legislation.

On December 2, 2002, the Minister of Indian Affairs and Northern Development tabled Bill C-19 on first nations fiscal and statistical management in the House of Commons. That bill, which died on the Order Paper in November 2003, was reinstated as Bill C-23 on March 10, 2004. That bill also died on the Order Paper after third reading. It was reintroduced very recently, on November 2, 2004, with some significant changes. We are debating this new Bill C-20 today, after studying it for not too long, but, say, carefully in committee.

However, former Bills C-19 and Bill C-23 were unacceptable both to us and to first nations. We had concerns about the fact that the act could work against aboriginal rights and reduce the federal government's fiduciary obligations toward the first nations. We were also concerned that the institutions would only serve a few first nations.

Bill C-23, for example, like the Indian Act, delegated tax authority to first nations communities, which came down to making aboriginal governments municipal entities, if you will, when their legitimate desire was to enjoy greater financial autonomy.

Moreover, the preamble to Bill C-20 uses language that reflects the government's strongly municipal approach to the first nations.

With respect to Bill C-19, we had a number of critical comments. First, the definition of “specific claims” was too narrow. Access to the tribunal was nearly impossible; the $7 million ceiling excluded most claims. Neither the commission nor the tribunal were independent or impartial. The minister had the power to accept or reject claims. Finally, there was doubt about the impartiality and flexibility of the process.

Fortunately, two very important changes have been made in the bill before us today. First, a schedule was added to ensure that the legislation applies to those first nations who wish to participate, because participation is optional, something we feel is very important. Second, a non-derogation clause was included to protect the aboriginal and treaty rights of all first nations.

These changes ensure consistency with the Charter of the Assembly of First Nations as well as the principles of self-determination, the approach taken by the first nations, and the optionality provided for in recent resolutions of the Assembly of First Nations, which were passed in Saskatoon and ratified again in Charlottetown.

This economic disparity exists because some lands do not have services, investors are uncertain and the cost of starting a business is still too high.

A backgrounder produced by the First Nations Fiscal Institutions Initiative says that a dollar of first nation tax revenue buys 30% to 50% less in capital works than it does for other governments. The problem lies primarily in the legislative and institutional framework.

For 130 years, the Indian Act has perpetuated this state of affairs, this lack of fairness. It has prevented first nations from creating their own institutions and participating in the economy.

Will Bill C-20 completely correct this situation? No, but we think it is a step in the right direction, as long, of course, as the federal government does not use this bill as a means to opt out of its financial obligations with respect to the first nations. I repeat, the government has a fiduciary obligation to the aboriginal peoples and it cannot opt out of that.

There are so many things to improve in the living conditions of the first nations that they will not be settled by this bill, but only through real political will exercised by the current government.

Housing conditions, education and health are inferior compared to the rest of the population. On the reserves, 65% of families live in substandard housing. The Bloc Québécois is deeply concerned about the fact that the lack of adequate, affordable housing for aboriginals has implications beyond housing standards. We know that various medical and social problems are related to poor housing conditions and quality of life. The Government of Canada must make the necessary efforts to correct the situation without offloading the problems to the first nations.

Bill C-20 will help first nations who so desire to participate significantly in their economy and encourage private investment on their lands, which is more difficult at present. First nations wanting to borrow money to develop their community infrastructure face transaction costs, processing delays and interest rates that are far too high, even prohibitive.

Despite the positive aspects of this bill, we must not lose sight of some of the basic principles it must respect. First, will it protect the first nations' right to self-determination? Will it benefit first nations, particularly those in Quebec? Will it protect the rights of first nations that opt out of the legislation and the obligations toward them? Will it help redress the fiscal imbalance of first nations that take advantage of this legislation? We may not get all the answers today, but we will make sure the minister does not forget these questions.

For the Bloc Québécois, aboriginal independence claims are very important and must be respected. Recently, with Bill C-14, we supported the aboriginal peoples' right to self-government. Bill C-14 was about the Tlicho people. This bill will help those first nations who so desire to access the financial tools they have been lacking and that the other levels of government have been using for a long time.

That is why we are in favour of Bill C-20.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, throughout the debate on this bill much has been made of the optional nature of the bill. Even in earlier incarnations this was less clear, but in this incarnation of the bill, as it went from Bill C-19 to Bill C-23, to now Bill C-20 in this Parliament, the claim is made by the government that this is truly optional and people's fears are groundless.

However, it remains unclear to me and perhaps the parliamentary secretary can help me with this. In relation to the statistical institute, which is one of the four new fiscal institutions created by Bill C-20, I do not understand how the claim can be made that Bill C-20 is optional. In fact, the statistical institute is not optional at all. All first nations in Canada come under this whether they wish to or not.

Unless I am missing something completely, there is no optional nature to the statistical institute. Perhaps this should have been dealt with as a separate bill. Perhaps the government should have introduced the three other fiscal institutions as one bill. If there was a need for the statistical institute, it could have been dealt with separately. I would like the parliamentary secretary to explain to me how the statistical institute could be seen as optional.

Canada Labour Code

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, I am pleased to speak this evening to Bill C-263, an act to amend the Canada Labour Code with respect to replacement workers during a strike action.

Before addressing this bill in particular, I believe it is important that we take the bill in the context of what has happened in this Parliament in times past.

In the 37th Parliament, a similar bill, Bill C-328, was debated and subsequently defeated. The reasons for that bill not passing then are relevant to our present discussions on Bill C-263 today, and that has to do with the amendment to the Canada Labour Code, part 1, in 1999.

Previous to that, HRDC undertook an extensive review that resulted in an amendment to the Canada Labour Code relating in part to our discussion today on the issue of replacement workers. The amendment to the Labour Code was precipitated by a task force report, chaired by Andrew Sims, entitled “Seeking a Balance”. I think the title speaks to what was attempted to be accomplished.

In that report, after extensive consultation with major stakeholders representing employers' interests, employees' interests, society's interests and the country as a whole, the majority recommended a provision in the Labour Code that would give employers flexibility to meet their operating responsibilities, but would prevent them from using replacement workers to undermine a union's legitimate bargaining objectives.

That is the balance that has worked since 1999. We have not had any instance where there has been a problem. There has been only one case that was to be referred to the quasi-judicial body and it was resolved before it got there. If it has been working, we need to allow it to continue working and not try to fix it. The minority report recommended a prohibition of replacement workers in its entirety, which is similar to the provision this bill is proposing.

A complete prohibition of replacement workers would force the parties to bargain in a closed environment, one which would not account for the economic realities of the marketplace, especially as we face them today. There are economic considerations both for the employer's benefit and the employee's benefit that require not only the preservation of the property, but the preservation of the business and the economic realities that it faces.

We find that we are, in the federal case, much different from what they would be in a provincial case because this jurisdiction covers essential services across the country and it affects not only one province but it affects Canadians across the whole country.

The relevant portion of the current section of the labour code, section 94(2.1), which Bill C-263 is attempting to change, is a result of the majority report and provides that no employer or person acting on behalf of an employer shall use replacement workers for the demonstrated purpose of undermining a trade union's representational capacity.

This amendment to the Labour Code was an attempt to deal fairly with the issue of replacement workers in the federal jurisdiction by accommodating the competing values and interests of employers, unions and employees. It attempts to strike a balance by prohibiting the use of replacement workers if the intent is to undermine a union's representational capacity.

It is not fair or accurate to say that it allows replacement workers in total. It allows them to the extent necessary and as long as it is not abused. So far employers have not been abusing that provision. It has been working. We know when there is a strike on. We know by the services, whether it is Bell Canada or the railways, that the service is being disrupted and the legitimate purposes of strike continues as the parties attempt to work things out. That must be preserved.

What is being proposed is significantly different from the solution that was reached by the stakeholders in the current Labour Code. The bill seeks to undo the substantial contribution of literally scores of stakeholders over a period of years and the subsequent full debate in the House of two bills, Bill C-66 and Bill C-19, which led to the amendments resulting in our current Labour Code.

I empathize with the intent of the bill, that any time the duties of anyone on strike are performed by someone else, the effectiveness of a strike is diluted and the bargaining position of the striking employees is weakened. Strike action is a valuable tool for employees who wish to bring resolution in the collective bargaining process, and the employees ought not to face punitive measures for taking action to which they are legally entitled. This attempts to balance that right and allows the provision for an unfair labour practice to be taken to a higher level.

The Conservative Party of Canada supports the right of workers to organize democratically, to bargain collectively and to strike peacefully. The Conservative Party is also committed to working with both unions and employers in areas of federal jurisdiction to continue developing dispute settlement mechanisms to minimize or avoid work disruptions to the benefit of both employers and employees.

In conclusion I would like to refer once more to the title of the Sims report, “Seeking a Balance”. After all was said and heard in previous Parliaments by countless witnesses on both sides of the issue, I believe they sought that balance and attained it. The balance exists and is now incorporated in the current part I of the Labour Code.

Many interests have been taken into account beyond just the interests of the employers and the employees. The report capsulized that our approach has been to seek balance between labour and management, between social and economic values, between variable instruments of labour policy, between rights and responsibilities, between individuals and democratic group rights and between the public interest and free collective bargaining.

We seek a stable structure within which free collective bargaining will work. We want legislation that is sound, enactable and lasting. We see the too frequent swinging of the political pendulum as being counterproductive to sound labour relations. We looked for reforms that would allow labour and management to adjust and thrive in the increasingly global workplace. That is the essence of it.

If Parliament wishes to re-examine this issue of replacement workers as part of a larger study, I believe considerable interest would be generated among the stakeholders to provide for a full and complete debate on this matter. That type of comprehensive debate and discussion cannot take place in the limited time we have in the House in the context of a private member's bill.

Without significant contributions from all of the affected stakeholders, I recommend that members of this House not support this bill in its present form. I agree with the previous comments, if it is fixed leave it that way.

[Judi Longfield, Liberal, Parliamentary Secretary to the Minister of Labour and Housing]

Mr. Speaker, I am pleased to join in the discussion on the debate on Bill C-263, an act to amend the Canada Labour Code (replacement workers). Even though I do not agree with the content or the intent, it is nevertheless an interesting topic worthy of considered debate.

We should discuss the issue of replacement workers in the context of the economic times we find ourselves in. To say we are living with challenges to industry and labour would be an understatement. The past decade has been one where the forces of globalization, trade and instant communication have changed the labour landscape forever. These forces, along with the corporate and economic restructuring, have placed great pressure on employers and employees and also on the existing collective bargaining environment.

Our economy is ultimately and intimately connected to our ability to manufacture goods and provide services to the world at competitive prices. Mad cow disease, SARS and disputed tariffs on our softwood lumber are just three examples of how industry can be undermined overnight. We are at the mercy of many things that we cannot control, including the price of imported oil and gas, the fluctuating value of foreign currencies in relation to the Canadian dollar, and unfair trade practices. All of these put our industries, including federal jurisdiction industries, at risk in the blink of an eye.

The workers that fall within the purview of the federal labour legislation are not immune to these changes. As the whole notion of work and the expectation of workplace partners change and evolve, the process of collective bargaining is just that much more complex.

Having legislation on the books that bans the use of replacement workers during an industrial dispute remains very contentious, so much so that 8 out of 10 provincial jurisdictions have chosen not to take this route. It is clear that it is a very polarizing issue for the stakeholders. Employee representatives and unions typically support a complete ban on the use of replacement workers. On the other hand, employers invariably argue in favour of their use. That was the position they held during the Sims consultation almost a decade ago.

I can appreciate that both sides have legitimate reasons for holding the positions they do. The extensive industrial relations expertise brought to bear during the Sims task force did not result in a unanimous recommendation on the use of replacement workers. However, when that report was released in early 1996, I believe it provided the best possible compromise, one that strikes the best balance between the competing expectations of the stakeholders.

Let us be clear on what those recommendations were all about. Sims said there should be no general prohibition of replacement workers but that there should be legislative recourse in the case of an unfair labour practice. That is why the task force recommended that the use of replacement workers in a dispute for the demonstrated purpose of undermining the union's representational capacity should be prohibited.

It also went on to say that in the event of such a finding, the Canada Industrial Relations Board should be given specific remedial powers to order the discontinuance of the use of replacement workers. Parliamentarians who were around at the time of the debate on Bill C-19 were also at odds over this provision, but in the end the consensus of most was that they should vote for balance. That is exactly what they did.

It seems to me that for our part as legislators it is not for us to take sides, but rather to come up with a rule of law where the needs of one side are not met at the expense of the other. That is why the legislative changes made in 1999 so closely mirror the task force recommendations. I would have great concern if we were to now arbitrarily, in isolation of other considerations, ban the use of replacement workers along the lines suggested in Bill C-263.

Banning replacement workers would reopen that old argument and dissension, and for no apparent purpose. It would jeopardize the compromise that was reached with such efforts and considered debate almost a decade ago. The long battle for a reasonable settlement on this sensitive issue would be reignited. New battle lines would be drawn. The debate would start all over again.

If it is indeed the case that the labour and management stakeholders in the industrial relations group will never find unanimity on this matter, then perhaps the very lack of agreement speaks to the need for us to continue to go on with a reasonable compromise. For us now to prohibit the use of replacement workers entirely would set back the course we set out with the changes in part I, implemented in the 1990s, which sought balance and compromise.

That is why the government is disinclined to make changes to the legislation that is working relatively well. Even though the hon. member's bill changes just a few provisions of the legislation, its potential impact could be substantial in upsetting the balance of expectation on the part of stakeholders.

I remain firmly of the belief that our current legislation is worded exactly the way it should be. The considerations of all parties at play are kept in balance. Both sides are evenly served. If the legislation is not broken, I do not think we need to fix it. Let us not go down that road again.

For these reasons, I cannot lend my support to Bill C-263.

Canada Not-for-profit Corporations Act

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I understand that I have 10 minutes with no questions or comments, with no actual real debate in the House today.

I rise today to speak to Bill C-21, an act respecting not-for-profit corporations and other corporations without share capital. The bill would also commonly be known as the Canada Not-for-profit Corporations Act.

I want to begin by addressing the new practice of the Liberal government of sending bills such as Bill C-21 to committee before second reading. Bill C-21, like the other industry bill before the House, Bill C-19 on competition policy, which we addressed a week ago, has been referred to committee for study.

In theory, the purpose of sending a bill to committee before second reading is to allow the committee members to introduce a broader scope of amendments to the legislation. The committee is allowed to propose changes that are outside the principle of the bill, which is what we debate at second reading: the principle of the bill.

In my view, however, the government is abusing this process. Eleven of the 23 bills that have been introduced by the government have gone or are going to committee before second reading. Debate in the House on this issue is limited to 180 minutes instead of the unlimited debate that would occur under regular second reading rules. Thus, through the back door, the government is limiting debate on this and 10 other bills. We are limited to 10 minute speeches with no time for questions and comments and no time to question the minister on the bill.

The fact is that a reference to committee before second reading is a handy scapegoat for a minority government. Rather than giving each legislative initiative careful thought and defending it, the government can tell Canadians that if they do not like the bill they can take their concerns to committee. This is also a very effective way and a strategy of this government to tie up a committee's time. A committee is supposed to be the master of its own house, to debate and deliberate policy on its own.

The Standing Committee on Industry, Natural Resources, Science and Technology has a bigger mandate in this Parliament with the addition of the combination of natural resources and industry. This is a minority government and the opposition wants to discuss issues like smart regulations and energy policy, as advanced by the member for Kelowna, but the fact is that those issues then get pushed to the back because we are studying these complex bills that are introduced one week before.

I just want to touch upon the process here. This bill was introduced last week. It is about 152 pages long with well over 300 clauses. A briefing was set up for the opposition last week. The member for Kelowna--Lake country went to the briefing. The briefing for Liberal members was extended so the briefing for Conservative members was essentially cancelled. Finally a briefing by the department was set up again for yesterday. The bureaucrats were late, by the way, so my colleague from Kelowna and I sat there twiddling our thumbs waiting for the government bureaucrats. They came in with an eight page briefing, in size 20 font, and here now are some of some of the wonderful things those officials told us.

They said the bill is complex and technical; well, that really indicates to us what is in the bill. They said information kits will provide essential elements; we are still waiting for these information kits. They also said that the bill was expected by stakeholders and some of them will seek to participate in the committee review process. Of course they will. This is the most common, basic information. Of course people interested in the bill will appear before the committee. Did we need a briefing to tell us that?

That was what we were told at the briefing on this very complex bill that the government wants sent to committee before second reading to tie up the committee because the government does not want to actually debate the issue in the House. Quite frankly, with respect to the minister and his staff, I have dealt with four industry ministers in a row and I have to say I am very disappointed with the way they have dealt with the opposition, particularly in a minority government. If the government is interested in passing this legislation, perhaps it ought to pass it over to us and give us maybe a week to prepare for it.

The government could tell us what it likes in the bill and what it thinks we should support about it because “we as a minority government recognize that we need at least one other party, in some cases two other parties, to support our legislation”. That is what it could say. Instead, the government is introducing Bill C-21 without debate, sending it to committee before second reading and frankly, in my view, avoiding the entire legislative process.

Having gone on that tirade, I do want to touch briefly upon the actual substance of the bill. I do not know if I will have time within the 10 minutes allotted, but I do want to also state publicly that the Conservative Party does not support sending this bill to committee before second reading and we are also not supportive of the substance of the bill at this time.

We have some concerns about this bill, the first under monitoring and enforcement. The fact is that Industry Canada has drawn up a very complex set of regulations and laws for record keeping, conflict of interest within these corporations, communications with membership, and financial reporting, to name just a few issues. But there will be no one at Industry Canada who will police or monitor the not for profit corporations' struggles with these requirements.

This is similar to the Elections Act. The government is setting up a huge bureaucracy and yet Industry Canada will not have someone who will actually assist all of these not for profit organizations across the country in terms of trying to fulfill all these requirements. Instead of setting up an arbitrator to help these organizations, most of whom I think rely on volunteers, this legislation would force disputes directly to the courts.

Having a lawsuit, either criminal or civil, because both are possible under this bill, would cost a not for profit organization time and money. In terms of the cost, there would be a larger financial burden on not for profit corporations in trying to meet the legislative requirements to change their bylaws and constitutions, to hire auditors and for liability insurance, to name a few areas. If the House passes this bill, a federally registered not for profit corporation would be required to make the transition to the new act within three years of the new act coming into force. Failure to do so would result in the director of not for profit corporations at Industry Canada taking action to dissolve the corporation.

In terms of the issue of how complex this bill is with respect to regulations, when someone is stalled in getting an organization up and running quickly by government inaction or by government regulatory burdens, the fact is that it costs the organization money and it delays what the organization does and what its purpose is. Frankly, the government has paid a lot of lip service, as the parliamentary secretary just did, to smart regulation when in fact it has failed to implement its own government committee on smart regulation, which came out just this year.

In addition to the bylaws contained in this bill that must be adopted by not for profit organizations in order to be allowed to exist by Industry Canada, there is a regulatory package that accompanies this legislation.

Under the proposed regulations, the degree of financial reporting is divided into five classes. For example, the type of financial report a not for profit corporation is required to submit to Industry Canada depends on the revenue of the not for profit corporation. The more revenue earned, the more formal the reporting requirement. There are no exceptions, so if a corporation has an exceptional fundraising year, the reporting responsibilities would increase as would the costs of the corporation for possibly redoing their books and paying for a more professional audit.

The regulations outline a very strict schedule for issuing notices of meetings. The minimum notification for a meeting of members is 14 days. This is in the actual legislation. This bill would make it illegal to call an emergency meeting within less than 14 days, thus removing some of the flexibility that smaller organizations rely upon to resolve important local issues.

The regulations do allow for some exemptions, such as the publication of membership lists if, for instance, the not for profit corporation is a battered women's shelter. One could apply to the director at Industry Canada not to have that membership list published. However, this application for an exemption would have to appear in the Canada Gazette and Industry Canada estimates that it would take at least 18 months for this process to be completed. It seems rather pointless to have to wait two years for an exemption if they only have three years to comply with this legislation in the main.

I do want to touch upon one other aspect, which is the whole issue of membership lists. It is a concern. What this legislation would allow is that if someone is a member of a not for profit corporation, that person would be able to access the entire membership list of that not for profit organization. The concern there obviously relates to privacy. Many members join these groups, but they do not feel they should have their personal contact information shared with anyone else who happens to be a member of that group.

The answer we were given by the people who gave the briefing was about how what if they want to contact these people in advance of the annual general meeting to advance one of their issues or to discuss something at the AGM and they want to inform people ahead of time. That may be a legitimate point, but should there not be another way to do that other than allowing an entire membership list of that organization to be eligible to just one person who signs up for a membership for $10 a year or something like that? Therefore, we do have some serious privacy concerns as well.

We also have some concerns with respect to liability. Many directors in the not for profit sector are volunteers. However, under this new scheme they will be liable for the actions of the not for profit corporation. I think organizations across Canada should read that section carefully.

Under the new standard of care, directors will have to act honestly and in good faith with a view to the best interests of the corporation, exercise the care, diligence, and skill that a reasonably prudent person would exercise in comparable circumstances, and comply with the act, articles, bylaws, and any unanimous member agreements. My concern is that this type of liability will deplete the pool of volunteers in the small, local, not for profit corporations that are simply trying to help their communities.

I could go on, Mr. Speaker, but I assume my 10 minutes are up.

Competition Act

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Mr. Speaker, I am pleased to have this opportunity to speak in support of Bill C-19 which amends the Competition Act.

We know that competition is central to our economy. Our economy can only flourish if the spirit of competition is followed and if all businesses in the economic system follow the rules of the game.

Indeed, Canadians, as well as citizens in other jurisdictions, hold very dearly to the principle of accountability, not only as it applies to government institutions but as it applies to the private sector as well. Canadians want to see accountability and transparency in their dealings with private businesses as well as with governments.

Competition law is not something that Canadians think about every day. I would be prepared to grant that. However, the idea of competition is an ingrained concept among all citizens. All citizens, whether they understand the details of competition law, know when they are being fairly treated in the marketplace. Competition policy and law is about ensuring fair treatment. Citizens may not know all the arcane details about competition law, but they know when they are being fairly treated and when they are not being fairly treated.

Bill C-19 is framework legislation that is part of a continuing process to ensure that the Competition Act and the bureau remain effective in a rapidly changing global economy. There have been many international comparisons of competition bureaus and competition regimes across international jurisdictions. I lament the fact that our own competition regime sometimes has come up a bit lacking. I believe this bill will help to rectify that problem.

Globalization, deregulation and the growth of the Internet have profoundly affected our competition regime. We must ensure that our legislation keeps pace with these changes. Much of what is in Bill C-19 began with the recommendations of the Standing Committee on Industry, Science and Technology and its 2002 report entitled “The Plan to Modernize Canada's Competition Regime”.

The committee suggested a wholesale reform of Canada's competition policy, including strengthening the act's civil provisions, repealing the criminal pricing provisions, and returning the act to a law of general application by repealing the airline specific provisions which had been inserted not long ago as a result of a particular situation that existed in the airline industry two or three years ago. The committee recommended that we repeal the airline specific provisions and add them to a general regime with sufficient deterrence to achieve compliance. Bill C-19 does that and more.

Let me begin with the proposal for restitution. Bill C-19 would provide a restitution remedy for consumers affected by false or misleading advertisements. As a consumer I welcome this change and think it is about time Canadians had access to remedies similar to those of their American counterparts.

All Canadians are consumers; all of us as members of Parliament are consumers. We often have encounters with retailers or businesses where we feel we have not been properly treated or we feel that the service we have been given has not really justified the price we are paying for a particular product. For example, we could go to a retail store and, as happened to me recently, come back and find that the wrong product had been put in the packaging. Then we have to make the return trip to the outlet where we are given the right product. However, there is no restitution. There is no sense that we have been compensated for the loss of our time.

I believe that Bill C-19, in a parallel fashion, by instituting remedies when consumers have been the victims of false advertising, really gives consumers the sense of satisfaction that businesses are responding to them and that the economy is functioning properly.

There can be all the competition law that we want, but if consumers do not feel that at the end of the day there is some kind of restitution, then they really lose faith in the system. I think this is one of the important aspects of this bill and we must recognize it.

We are talking about the administrative monetary penalties, AMPs. In the case, for example, of misleading advertising but also in cases of abuse of dominance, it is important to realize that the competition tribunal would decide the matter, not the bureau which acts as prosecutor in such cases. Oftentimes there is confusion between the tribunal and the bureau. Having a general AMP regime in place as opposed to provisions specific to one industry will ensure a level playing field among all participants in all sectors. It would also provide a significant incentive to comply with the act.

Under this new provision, the maximum amount for an AMP would be $10 million for the first order and $15 million for each subsequent order. Bill C-19 takes a balanced approach. It includes a list of factors for the tribunal to take into account when making an order for the payment of AMPs.

Another proposed amendment is the repeal of the airline specific provisions. These provisions are no longer necessary. The airline market is much more competitive than it was two or three years ago when these airline specific provisions were included.

I wish to say again that the Canadian aviation industry has changed a lot since Air Canada's merger with Canadian Airlines. For example, Air Canada's domestic market shares have drastically declined. We have also seen the creation and growth of discount carriers, like WestJet, the increasing role of the Internet as a ticket distribution vehicle and a change in the role of travel agencies. These airline specific provisions achieved their purpose.

The 2002 Standing Committee on Industry, Science and Technology's report recommended that these provisions be repealed and replaced by a general system that would provide a sufficient deterrent to ensure compliance. This is exactly what the bill is aiming to do with the introduction ofthe AMP, or administrative monetary penalty, system.

We already have an AMP system under the deceptive marketing practices of the Competition Act. However, the existing limits for AMPs are not considered appropriate anymore, because they are not proportional to the earnings that businesses can derive from deceptive marketing practices. Bill C-19 proposes an increase of the maximum penalties to $750,000 for individuals. For businesses, it would be between $10 million and $15 million for each subsequent order.

This modification would promote compliance with the act and serve as a deterrent for deceptive marketing practices.

The last amendment in Bill C-19 relates to the criminal pricing provisions of the Competition Act. These pricing provisions deal with price discrimination, geographic price discrimination, predatory pricing and promotional allowances.

They are all criminal practices at the moment and must be addressed in the context of very high criminal burden of proof which of course is a problem because in many cases it is very difficult to prove that these practices have occurred. What is proposed here is to have these matters addressed under the civil regime of abuse of dominance. In other words, pricing complaints would be reviewed under the abuse of dominant position where AMPs, administrative monetary penalties, would be available. The industry committee, in its 2002 report, had recommended the repeal of the criminal pricing provisions and Bill C-19 reflects the committee's concerns.

Bill C-19 is a well thought initiative which is aimed at encouraging compliance with the Competition Act and deterring anti-competitive behaviour. It contains a balanced package of legislative amendments that address both the interests of consumers, and small and large businesses. For this reason, I would advise all members to join me in supporting this important legislation.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, it is a pleasure to rise today to speak to Bill C-19, amendments to the Competition Act. I want to preface my comments by saying that the issue we are dealing with has to do with housekeeping. There are some important changes to the act. There have been additions that I believe will benefit consumers. We will have questions at committee and the opportunity to discuss them, but overall the bill fails to address issues that were discussed in 2002 with quite a degree of public consultation.

It troubles me that we have seen a series of bills like this coming through the House already, but we want to see a greater progression of legislation and we will have to see if it carries on past that. I hope that at committee we will address some of the deeper issues.

In this bill, there is an addition of additional monetary penalties for abuses of dominance and the effects on consumers in the market. I think that is a good step. Having some type of penalty is very important, because some of the practices that are affecting consumers right now are very difficult for people to deal with, especially when they lead to the frustration that nothing will happen at the end of the day. We do not want to be in a situation where we are over-penalizing or reducing the ability of the market to be creative. There needs to be an opportunity for people to advertise and push their products in the market. At the same time, there has to be accountability.

One of the things I am concerned about, and about which I have heard of a lot of frustration from my constituents, is related to the preying on seniors. I think we should be in the forefront of that particular issue because we have an aging population and there are more opportunities for those with less scrupulous practices to prey upon seniors.

The bill would act as a framework that applies to all businesses in Canada. It now has civil and criminal law provisions, which are being discussed. The objective is to protect competition, not individual competitors. Once again, that is the way in which the bill should be moved forward. Everyone agrees on that, which is very important.

The big issue is the resources from the bureau. We know the government scaled back the bureau significantly. In the past, the government took the Competition Bureau much more seriously. Back in 1993 there was a department of consumer affairs. The department was folded into government restructuring in the 1990s and has been part of Industry Canada since then, with its budget and staffing reduced. It is very important that the staffing and the tools are available so that we can look at competition issues.

One particular example is the fact that unions, organizations and a number of interest groups brought up the issue of evergreening to the Competition Bureau. It did not have the appropriate tools to deal with the situation and had to pass it back to the government. It blocked a situation where we wanted to have an anti-competitive issue looked at because it was affecting the pricing of drugs. The Supreme Court of Canada has called the current rules draconian, while at the same time the Competition Bureau could not deal with it because it did not have the appropriate tools.

Many of the changes to the bill will be minimal, as I have noted. It is important to once again focus on the fact that we do want to have the resources available when people have complaints.

Another big issue that has been raised is the labelling of foods, an issue on which we believe the Competition Bureau should have more flexibility. Once again, consumers want to have choice. That is what it is about. They want to have the opportunity to see what is in the foods and the services they are purchasing with their money. That requires rules and regulations. If there is misguided advertising related to those products, it can affect human health and people do not get a chance to actually make the choices they want to with their money.

I will wind up quickly, because I do not believe the bill deserves much more debate at this time as it will be referred to committee and is generally just housekeeping at the moment.

We will be asking significant questions about the AMPs, the fines and such, and whether or not they will be tax deductible. A good example is that those who are fined for an environmental infraction in this country after going through a court process get back 50% of the fine as a tax write-off. It is a business related expense. I want to make sure that if there are to be fines against competitive practices, perpetrators will not be able to write off half of those fines as a business related expense. That is absolute nonsense. It is not just about the consumer being ripped off; it is about those industries and business that are competing fairly but are seeing their profits and their employees suffer because of that.

There are other issues related to that in terms of how the deductions, taxing and all those things will be related to the bill. I am looking forward to asking those questions. Hopefully we will see a further review of this act so that we will have significant changes, as opposed to this housekeeping that is happening.

[Brent St. Denis, Liberal, Algoma—Manitoulin—Kapuskasing, ON]

Mr. Speaker, I am pleased to participate in this debate on Bill C-19. As a member of the industry committee, I look forward to studying this bill in greater detail, hopefully as soon as Thursday if all colleagues are agreeable.

I listened carefully to the previous speaker, a member for whom I have great respect. I am sure the points he has raised will get good attention at the committee. We appreciate his bringing those points forward.

In addressing Bill C-19, a bill which proposes some important amendments to the act, I would like to focus on two particular provisions, both of which deal with deceptive advertising.

The first amendment would increase the administrative monetary penalties, or AMPs, that can be imposed when the courts find that a company's false advertising has had a significant negative impact on the economy. The second amendment would allow for restitution when false or misleading claims harm consumers in a manner that can be objectively quantified.

These provisions are improvements to the existing aspects of the act. AMPs, administrative monetary penalties, for false and misleading advertising already exist. The government is simply proposing to increase the amounts. Similarly, the addition of restitution is to increase the options available to courts to help consumers who have suffered losses because of deceptive claims.

It is important to remember as we consider these proposed amendments that catching and punishing flagrant violators of the Competition Act is only a very small part of what effective competition legislation allows the government to do. By way of analogy, we might think of traffic legislation. The most important function of a highway traffic act is to make it clear and obvious to everyone what acceptable driving practices are to give us all an incentive to follow those rules. Catching violators is pointless if the law does not provide that incentive.

Canada's Competition Act is effective because the major thrust of the act is to encourage voluntary compliance. This is also true of the amendments before us today. The effectiveness of the act is backed up by the Competition Bureau's work to ensure that Canadian business people know what is required of them.

The proposed amendments are refinements, not innovations. The administrative monetary penalties are already an option available under the act for some kinds of deceptive advertising as determined by the courts. Increasing the amount of penalties does of course increase the deterrent effect. That said, there is always a deterrent effect. The very fact that a company has to respond to proceedings against it has a deterrent effect.

What I would like to stress to the House is that a larger AMP emphasizes the seriousness of the deceptive behaviour. It tells people in the industry, the company's shareholders and the general public that a business has done something seriously wrong.

The second matter I would like to discuss is closely related in that it also applies to cases of deceptive advertising. It is a very unfortunate thing that few remedies under the Competition Act exist to address losses incurred by consumers affected by false and misleading advertising. This is a situation that needs to be changed.

The proposed amendment would give the courts another remedy for cases in which advertising has misled consumers into buying a product that simply does not work or meet the standards the advertiser proposes. This restitution, however, also has the ability to send a powerful message. It is only in a limited number of cases that deceptive advertising can be demonstrated to have had a measurable impact and that a case can be made for restitution. But when that happens, the message sent will be unmistakable.

I would remind the House that it is not enough to say caveat emptor, or buyer beware, when responding to some kinds of deceptive advertising. It is one thing when a consumer does not realistically assess a product. It is quite another when a company makes false claims about a product in its advertising.

Advertising is not just a way for a company to pitch and promote a product. Advertising is often a primary source of information about a product. It is not objective information. Vendors are trying to make the best case for their products, but the majority of advertisers manage to do this without misrepresentation. If this were not the case, nobody would pay attention to advertising.

Honest advertisers will naturally defend their freedom to promote their products aggressively, and they should, but this freedom needs to be balanced. Honest advertisers will recognize that some kinds of deceptive advertising call the legitimacy of all advertising into question when not actively discouraged.

Some critics will suggest that there is an equally valid fear on the other side of the scale: that we have to be careful not to create a chill effect that would frighten companies away from perfectly acceptable advertising practices. Is that fear legitimate? It most certainly is. That is precisely why the government has proceeded so carefully here.

Following the industry committee's review of the Competition Act, the government studied the issues extensively and consulted widely. The changes proposed here are not far-reaching or drastic. They are careful but effective steps in the direction the government has established it should be moving.

I will sum up as follows. Yes, it is true that the majority of advertisers intends no mischief, but it is also true that the Competition Bureau hears too many complaints from consumers who have lost money because the products they have purchased simply do not work as advertised. The message the government wants to send about some kinds of deceptive advertising is more than “do not do this”. The message the government truly wants to send is “do not even think about doing this”.

The amendments we have before us today are a sensible refinement of the legislation that exists to send just that message. I encourage my fellow members to support Bill C-19. As a member of the industry committee, I certainly look forward to dealing with the bill, with my colleagues, as soon as the House is ready.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I am pleased to speak today on Bill C-19, an act to amend the Competition Act and other related acts.

The Competition Act is a very important one. It is what we consider to be framework legislation. The purpose of framework legislation, such as the Competition Act or the Copyright Act, is to clearly outline how the government is will facilitate healthy relationships between businesses, consumers and government and thus allow the economy to allocate resources more efficiently. Any amendments to framework legislation merit a discussion of policy, and that is where I would like to begin.

In the purest economic sense, the purpose of the Competition Act is to strike down forces that restrain competition and inhibit the market from generating wealth. The act also serves as a regulator to correct areas where there is too much of a monopoly.

With respect to competition policy, the Conservative Party of Canada is guided by a belief that the best guarantors are the prosperity and well-being of the people of Canada through: first, the freedom of individual Canadians to pursue their enlightened and legitimate self-interest within a competitive economy; second, the freedom of individual Canadians to enjoy the fruits of their labour to the greatest possible extent and the right to own property; and, third, a belief that a responsible government must be fiscally prudent and should be limited to those responsibilities which cannot be discharged reasonably by the individual or by others.

The Conservative Party and its founding parties have consistently put forth the view that Canadian consumers and producers are best served not by a tribunal or by government intervention in the marketplace but by genuine business to business competition. The focus of competition policy therefore should be not to protect individuals or individual companies but to facilitate competition itself.

The standing committee on industry in 2002 spent many enjoyable hours discussing competition policy during the last Parliament. I am quite sure that the committee's future studies and report on the bill will be excellent as well.

On April 23, 2002, the committee tabled in the House a report entitled, “A Plan to Modernize Canada's Competition Regime”. The report was the culmination of a great deal of study by the committee, which included extensive hearings over a number of months. Also, during the 37th Parliament, the committee studied a private member's bill that would have amended the Competition Act to clarify the competition tribunal's powers to make or not an order in the case of a merger when gains and efficiency were expected or when the merger would create or strengthen a dominant market position.

We should recognize the hard work of various members of the House in terms of competition policy, even though we have not always agreed. For instance, I often disagree with the member for Pickering—Scarborough East on where he would go with competition policy, but I think his efforts need to be recognized. While his bill was passed by the House of Commons, it was not passed by the Senate.

I would appreciate knowing, when we study the bill, what if any plans the government has for addressing the issues raised in the bill of the member opposite and whether it will bring forward the bill that was passed in the last Parliament.

In spite of all the work that the House has completed in studying the Competition Act, it is a very complicated policy area. The government has recognized this fact, and I compliment it on its commitment to public consultations in the preparation of the bill.

With respect to the details of Bill C-19, the Conservative Party of Canada will be in favour of sending it to committee before second reading. It is an extremely technical piece of legislation that deserves the full attention of the standing committee and of legal experts in the field. However, at this time I want to clearly state that we do have a number of problems and questions related to the legislation, and I will outline them. It is my hope that we would be able to address these issues effectively in committee.

I would like to start by summarizing the legislation before us today.

Bill C-19 would provide restitution for consumers affected by false or misleading representations. The amendment would empower the Federal Court to order advertisers who contravene the false or misleading representation provisions of the act to provide restitution to consumers in an amount that would not exceed the amount paid for the products on which they were misrepresented.

The bill would create a new general administrative monetary penalty provision, a fine for what is called abusive dominance. The maximum penalty under such cases would be $10 million with $15 million for each subsequent order. The penalties would be paid to the consolidated revenue fund.

Furthermore, Bill C-19 would remove the airline specific provisions in the act, something that the previous member spoke on at length, with the introduction of a general fine to deal with cases of abusive dominance. Airline specific provisions are no longer necessary.

The bill would also increase the total amount of the fines applied to deceptive marketing practices to a maximum of $750,000 for individuals and $1 million for each subsequent order and $10 million for corporations and $15 million for each subsequent order.

Bill C-19 would also decriminalizes the pricing provisions. This type of behaviour would continue to be dealt with under the civil abuse of dominance provisions with the addition of fines.

I would like to offer a critique at this point of the legislation. The legislation does act upon some of the recommendations of the 2002 report by the Standing Committee on Industry, Science and Technology, which was supported by both the Canadian Alliance and the Progressive Conservative Parties at the time, although we did offer some helpful dissenting reports. The report recommended that the government repeal all special provisions in the act regarding the airline industry so that the act applied generally to all industries and not specifically to the airline industry. We support that provision.

Interestingly, the government has changed its position on this issue. The initial government response to the standing committee's recommendations stated, “The government believes that the Competition Act currently needs specific airline provisions.” Now the government has changed its position. I guess we should commend it for recognizing that the committee was right in its recommendation.

My understanding is that the airline provisions were also a part of the Canada Transportation Act. I would like to ensure that the amendments presented in Bill C-19 would eliminate the airline provisions as specific provisions from all government legislation.

In addition, the standing committee proposed allowing the Competition Tribunal to impose fines involving a number of sections in the act, including abuse of dominance. The government has acted in part on this recommendation.

The most contentious issue is the large fines for abuse of dominance position. This section requires further clarification because the bill does not clearly define all of the activities that might be construed as abuse. In addition, these fines could total more than any criminal fine in the act, raising the question of why these civil provisions would be more punitive than criminal provisions in the bill.

Finally, we need to ensure that these fines will not have a negative effect on investment in Canada generally. That goes back to what I was saying earlier. We have to ensure framework legislation, such as the Competition Act. Its purpose is to facilitate competition; it is not to protect individuals or individual companies.

In conclusion, we have seen repeated reports in the news of how the Competition Bureau is struggling to deliver its services more effectively. We are asking it to do more and more, but the resources we are giving it has stayed constant or in some cases has decreased.

The former commissioner of competition, Konrad von Finckenstein, stated publicly that the bureau needed more money if we were to give it more functions. On June 21, 2003 he stated that he needed “$11 million more in his budget to come up to the minimal acceptable level of funding”. He went on to say that the bureau's money shortage was hurting the country's international reputation.

We believe he was right. The Global Competition Review , a journal in the United Kingdom specializing in anti-trust policy, has recently accused the Canadian Competition Bureau of being less efficient than many industrialized nations, including the U.S., Germany, Australia and the European Union.

The OECD has also criticized the Competition Bureau. In 2001 the OECD issued a report that stated:

The desire to retain Canadian control in some sectors (rather than allow foreign investment) limits what competition policy can do to remedy problems, which leads to tolerating monopolies subject only to ad hoc measures to regulate them.

The OECD also stated that the bureau was underfunded as well.

To reiterate, we are best served by genuine business to business competition. The Conservative Party will continue to ensure that the Competition Act and the tribunal be guided by that principle rather than by the desire of some Liberal members to turn the act and the tribunal into an instrument of undue government interference in the marketplace.

Direct government interference in the economy by the Liberal Party has resulted in reduced competition and a weakened competitive advantage. In 1998 Canada was ranked 6th in competitiveness by the World Economic Forum. In 2004 it stands 15th.

The Conservative Party is pleased the government has begun to review essential economic legislation such as the Competition Act. However, there are many recommendations from the committee, on which I served, which have not been acted upon.

Therefore, the Conservative Party calls upon the government to continue to review acts, such as the Competition Act, to ensure greater efficiency in the marketplace, but to be guided in the first place by a view that we need genuine business to business competition, and the act should do that.

[Andy Savoy, Liberal, Tobique—Mactaquac, NB]

Mr. Speaker, I would like to examine today the changes proposed to the Competition Act that are now before Parliament.

These changes reinforce the Competition Act. For almost 20 years, this act has been an excellent tool supporting an equitable, efficient and competitive market in Canada. The changes proposed in Bill C-19 take into account today's circumstances as well as comments made by consumers, businesses and parliamentarians, including the House Standing Committee on Industry. Quite simply, these changes will make this law better.

A certain amount of aspects of this legislation deserve our attention. Today, however, I will address only one of them: the proposal to repeal the provisions of the act which concern specifically the airlines. I am convinced that these changes are appropriate at this point in time and that they will improve this important instrument of economic legislation.

The changes apply to four sections of the act, which that apply specifically to the Canadian of domestic airline industry.

First, the changes eliminate the definitions of anticompetitive acts pertaining to air transport.

Secondly, the changes eliminate a series of provisions that allowed travel agents to collectively negotiate commissions with the dominant airline without the risk of being prosecuted under the provisions regarding conspiracies and price fixing.

Third, the amendments eliminate a provision allowing the Commissioner of Competition to issue cease and desist orders during an investigation on the possible abuse of dominant position in the airline industry.

Fourth, the amendments eliminate the administrative monetary penalties, or AMPs, that may be imposed on an air carrier that uses its dominant position abusively, since the proposed changes include AMPs that apply generally to all industries.

In order to understand why the government is introducing these amendments now, we must remember the conditions that initially led to the enactment of the provisions aimed specifically at the air sector.

These provisions were adopted in the wake of a series of major and unusual changes in the air transport's domestic market. First, the merging of Air Canada and Canadian International resulted in the creation of a very dominant company that generated 90% of all domestic revenues, while handling over 80% of domestic air traffic.

Later, the market was deeply affected by the September 11 terrorist attacks. All over the world, the air transport industry suffered major financial losses, because many people were afraid to fly.

That slowdown accelerated the upheaval that had already begun in the Canadian air transport industry. Canada 3000 declared bankruptcy, leaving WestJet as Air Canada's sole domestic competitor. Many experts were of the opinion that the business environment at the time was too great an obstacle to allow the establishment of new domestic discount airlines. It was felt that this was the case not only in Canada, but also in other major markets.

Now, the situation is a very different one. First, competition in domestic air transport has significantly improved. The power of dominant carriers to use their market position was offset by the efficiency and low overhead costs of discount airlines. Moreover, Air Canada's share of the market is no longer as dominant as it was at one time. In fact, in western Canada, Air Canada accounts for less than half of all domestic flights. The eastern triangle of Toronto, Ottawa and Montreal is now one of the most competitive markets in Canada.

In light of this change of circumstances, the government believes that it is no longer necessary that the Competition Act specifically target the air transport industry. The act can now revert back to being a piece of legislation that applies generally to all types of industries, as recommended by the Standing Committee on Industry. However, as was pointed out by some parliamentarians, eliminating these provisions is not enough. We must also provide incentives that will have a real deterrent effect on anti-competitive practices.

AMPs in respect of cases of abuse of dominant position were and remain a good idea. So much so, that it seems logical to apply them not only to the airline industry but to all industries. This is precisely what the new legislation would do.

The role of AMPs is to prevent a company from convincing the public or its shareholders that it is competing fairly when, in fact, it is not. This logic applies to dominant companies in all industries. This is why, under this bill, AMPs would apply across the board.

Along the same line, it is logical to repeal anti-competitive conduct definitions relating specifically to airline industry. Airline industry conduct will be treated like the conduct of any other industry.

Specific provisions applying to relations between a dominant carrier and travel agencies have become obsolete by force of circumstances. Travel agencies now earn their income from service fees they charge to their customers, rather than from commissions on the sale of tickets. Also, customers are increasingly using the Internet to buy their tickets directly from airliners.

Finally, provisions relating to the power of the Commissioner of Competitions to issue prohibition orders under Section 104.1 have been successfully challenged by Air Canada and have been rendered inoperative by a court decision. Therefore we have to repeal those provisions.

In summary, what do we have on the table? Under this bill, the legislation would become an act of general application providing for new incentives. It repeals two aspects of the act which are no longer necessary. It also repeals another provision which has been rendered ineffective by a court challenge.

If we keep in mind that the abrogation of the provisions relating specifically to the airline industry is accompanied by a general application of AMPs, the choice is very clear. We can update the provisions relating to the airline industry while strengthening the whole act it in a more general way. Besides, my colleagues will have the opportunity to talk about other legislative improvements introduced in the House which will allow for a balanced approach where stakeholders and parliamentarians interests are concerned.

Finally, I ask the House to pass this bill quickly.

[Marc Boulianne, Bloc, Mégantic—L'Érable, QC]

Mr. Speaker, I am pleased to rise this morning to speak to Bill C-19, an Act to amend the Competition Act and to make consequential amendments to other Acts. But first, I would like to congratulate my hon. colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, who summarized earlier the position of the Bloc by highlighting the flaws and omissions of the bill as well as the improvements that could be made. It is important to understand what is going on.

Before moving on to the subject at hand, that is, the bill before the House, I would like to talk about the principle of competition itself. Competition is not a bad thing. Competition is about a free market based on the free movement of goods and services. Our whole economic system relies on the classic economic theory of supply and demand. Therefore, for our system to work well, businesses must be free to produce the goods they want to produce. And they must also be free to sell their goods under various conditions, and consumers must be free to accept the goods. Of course, that leads to competition among businesses fighting for customers.

The problem in our market economy is not competition but rather the cases of abuse of competition as clearly defined in the bill. It deals with cases of abuse of dominant position and deceptive marketing cases. To smother or get rid of a competitor, businesses have no qualms about relying on deceptive marketing practices. We see it every day. Advertising is all about unfair competition.

There is also price discrimination. It is common practice that competition can still be distorted through pricing. There is also dishonest promotion. We are submerged by it every day. Moreover, geographic discrimination is such that competition hampers the free circulation of goods and services. The consequences of a unfair competition can surely be dramatic for a business and for clients, but also for a region. Every time I have an opportunity to talk about it, I obviously talk about my region, the asbestos region. Our resource, chrysotile asbestos, has been suffering for several years from unfair competition on the part of businesses which have replacement products. All means are used. There are international conspiracies to annihilate an economy and a region through unfair costs, which have become commonplace. In a system where competition is distorted, not only companies, but regions can be destroyed.

A careful look at the wording of Bill C-19, reveals, as my colleague was mentioning, that improvements have been made and that some very positive things are to be found in the bill. Besides, sanctions are in place to compensate people who have been misled. I think usual and a good thing in the proposed legislation. There are even sanctions including an injunction to block the distribution of some goods.

Let us look more closely at the summary of the bill. It amends the Competition Act, first providing authority for the commissioner of competition to seek restitution—as I said earlier—for consumer loss resulting from false or misleading representations.

That is obviously the minimum a bill would need to be effective. If there are no sanctions, why bother having a bill? Here, too, it would increase the level of administrative monetary penalties. I think that will discourage quite a few. These administrative monetary penalties will be imposed for deceptive marketing practices. Thus, there is considerable work to be done on this.

A general provision would have to be put in place to introduce administrative sanctions for abuse of dominant position in any industry. This is something we see every day, very regularly. There are cases of dominance in the industry, which interfere with the market economy and competition and which, as I mentioned, have disastrous consequences not only for clients, consumers and businesses, but also for regions.

There is also a clause that removes the airline-specific provisions from the act to return it to a law of general application.The bill also makes other amendments.

As I said, this is the minimum that should be found in a bill that aims to fight unfair competition, dishonest practices and false advertising. Unfortunately, Bill C-19 does not go far enough, as my colleague has said. It is incomplete.

A standing committee was responsible for making recommendations to improve it, to make it a complete bill. As my colleague mentioned, many additions were not included in the bill, and they are still not there today. Thus, the standing committee did not receive a positive response to its 29 recommendations.

There are at least three recommendations I want to stress. The Bloc Québécois has identified them, and in our opinion, they not only should be part of this bill, they could improve it and would be remarkably effective.

For example, we can look at recommendation No. 9, which would permit a party to a contested proceeding to refer to the Competition Tribunal a question of law, jurisdiction, practice or procedure in relation to the application or interpretation of these parts.

This is important. A party, be it a merchant or someone else, who feels that it has been wronged and that justice has not been done will eventually be able to go to the tribunal. We know that today, in the current context, unless the bill is amended, only the commissioner can bring such matters before the tribunal, or else both parties can do so, provided they are in agreement.

I think this should be included in the bill, so that no party is wronged and that it is possible and easy for either party to be heard.

There are other recommendations. My colleague referred to them earlier. I would like to focus on the one dealing with creating a two-track approach to offences, here again promoting greater efficiency. The legislation, on the one hand, deals with conspiracy and, on the other hand, with any other type of agreement with respect, for instance, to restrictions to competition. This absolutely must be well defined. Also, subject matters, purposes and proceedings all have to be clearly identified, if any positive results are to be achieved.

On the subject of conspiracy, I gave an example earlier. Conspiracies are not always obvious. They can be very difficult to prove because, very often, things are done indirectly that could not be done directly. Disinformation is used—with abandon. There are not necessarily any identifiable practices in place, making conspiracy very difficult to prove.

The consequences are obvious, however. Businesses suffer, as do their clients, consumers and the regions also, as I indicated earlier. In my opinion, and it is also the opinion of the Bloc Québécois, proper identification of conspiracies is necessary.

Another recommendation is to permit questions of law to be considered by all the members sitting in a proceeding, whereas only a judge can do so at present.

If I may make a final comment, nothing in this bill indicates that these offences will remain illegal after this legislation is passed.

Under the circumstances, as my hon. colleague said, the Bloc Québécois figures that important additions ought to be made to the bill. Therefore, the Bloc Québécois is in favour of referring the bill to committee but is reserving judgment on the substance of the bill.

[Lynn Myers, Liberal, Kitchener—Conestoga, ON]

Mr. Speaker, I wish to speak today about some of the amendments to the Competition Act proposed in Bill C-19 currently before this Parliament.

In particular, I would like to discuss two aspects of the bill. The first is the amendment providing for an administrative monetary penalty for companies that have been found to be abusing their dominant market position. The second removes criminal provisions regarding predatory pricing, price discrimination, geographic price discrimination and promotional allowances.

Before addressing the specifics, I would like to review some of the larger objectives behind these changes. The goal of the Competition Act is to establish business conduct rules that are fair and transparent. Such a system does not just discourage unfair competition, it also supports and encourages those who want to compete honestly. The honest players can see what is required of them and recognize that the rules apply to everyone. In such an environment there is an undeniable and positive incentive to play fairly.

That, in turn, gives us balance. Today there is a growing consensus that a fair market benefits everyone. Businesses recognize that they are consumers too and we consumers know that businesses are essential to creating the wealth we spend. Consumers also know that competition gives us better services and products for our money.

Canada is fortunate to have an effective and strong Competition Act. It got that way because it has been improved cautiously and incrementally over the years. The two amendments I recommend today are good examples of this kind of approach. I am equally certain that we can make other improvements, and we will do so in the future, but we will only do that once they have been subjected to the same careful review and broad consultations, as were the amendments we have before us today.

The first and most important of the two amendments I will discuss provides for an administrative monetary penalty, or AMP, when companies have abused their dominant market position. The general thrust here is simple. The government is amending the act to give more force to civil provisions in this area.

Abuse of dominant position is a dangerous occurrence because a company behaving in this manner can seriously injure its much smaller competitors in relatively short order. In these cases it is not always enough to be able to say the abuse has taken place. The competition tribunal should also have the option of backing that up with a sanction that is proportionate to the seriousness of the abuse.

The AMP makes civil actions against such players more effective. As a consequence, it encourages them to refrain from acting unfairly in the first place.

At the same time, a civil action is much more flexible than a criminal prosecution. The burden of proof attached to a civil action is lower than that required for criminal actions. They are also less disruptive than criminal actions. Attaching a sanction to this option encourages companies to ensure they are complying with the act rather than depending on government action to force them into line.

AMPs are a proven approach as well. A number of other advanced industrial nations have used AMPs to very good effect. These proposed amendments would bring Canada's Competition Act into line with the approaches used by our major trading partners.

It is no secret that big businesses do not unreservedly welcome sanctions. Companies understand that, at minimum, sanctions necessarily have some impact on honest dealers as well as dishonest ones. However firms also raise a legitimate concern that overly intrusive rules can have a chilling effect on otherwise legitimate competitive behaviour. The government shares these concerns and has taken them into consideration.

As is the case with all proposed amendments to the Competition Act, the AMP is being instituted in a way that will minimize its impact on the market as a whole. The AMPs are targeting abuse of dominance cases where the negative impact of the behaviour on the economy is potentially the most significant. I would also remind the House that the competition bureau will continue to publicize guidelines on the act's provisions so that companies know what they have to do to comply.

I will now discuss a second issue covered by the proposed amendments, that being the decriminalization of provisions regarding various pricing practices. As I do so, I would like to point out that the two amendments are not unrelated. The government is proposing to eliminate certain criminal provisions in part because the AMP I have just been discussing can be used to deal with the same practices in a less onerous but more effective way. These amendments would repeal the criminal provisions regarding price discrimination, geographic price discrimination, predatory pricing and promotional allowances. This type of behaviour would continue to be dealt with under the civil abuse of dominance provisions with AMPs.

The simple truth is that there have been few cases in which these provisions have been used. The standard of proof for criminal prosecution is high and, of course, it should be. In addition, for the purposes of protecting small businesses from unscrupulous competitors, criminal proceedings have serious limitations. The criminal provisions are a difficult to use instrument and, at the same time, a blunt one.

The proposed AMP gives competitors an incentive to act in accordance with the act and gives the commissioner a more flexible means to pursue dominant competitors that are engaged in pricing behaviours that cause injury to competition.

For all those reasons, and by way of conclusion, I want to advise the House that Bill C-19 is a good bill and should proceed with the concurrence of all members. I would hope that there would be general support in the House for this very important initiative.

[Bev Desjarlais, NDP, Churchill, MB]

Mr. Speaker, I want to acknowledge my colleague from Windsor West who is a bit under the weather today and wanted the opportunity to speak to this piece of legislation that he has been working on for some time now. I want to acknowledge the work that he has done.

Discussions on the Competition Act have been going on for some time now. When I was on the industry committee, we spent a fair amount of time on the Competition Act and issues relating to competition, lobbying the industry, and a whole number of areas. It is interesting to note that the one particular matter within Bill C-19 that is being put back to the way it was is the issue relating to airlines.

I was the transportation critic at the time when the Minister of Transport requested the removal of the airline industry from the Competition Act. It was a terrible period of time. I was not happy with the route that he took. I was not happy with the fact that airlines were being removed from the Competition Act. I was not happy with the fact that the competition commissioner would be the person setting out the deal that would merge Canadian Airlines and Air Canada. As a result, there were ongoing disputes within the industry among workers and others. I was not happy with that process.

Bill C-19 is the product of several years of consultation. The industry committee released a report in 2002 on modernizing our competition regime. The ministry reviewed the report's recommendations and limited public dialogue was initiated through a public policy forum. The Competition Act is intended as a framework law that would apply to all businesses in Canada. It has civil and criminal law provisions. Its objective is to protect the process of competition and not individual competitors.

The Competition Bureau enforces and administers the act through the commissioner and is an independent law enforcement organization. The purpose of the bureau is to attempt to ensure that Canada has a competitive marketplace and that all Canadians enjoy the benefits of competitive pricing, product choice and quality service.

The Parliamentary Secretary to the Minister of Industry has indicated that Bill C-19 is essentially a bill that would not accomplish all that it could. Many other changes were recommended in the 2002 parliamentary committee report that are not dealt with in the bill. The fact that the bill falls short of its potential is no reason to oppose it, but we are disappointed that over two years have passed and this is the best that the government has come up with.

As is apparent now, my colleagues in the NDP will be supporting the bill because it does provide several minor changes to the Competition Act that we believe are necessary. It does provide to some extent the Competition Bureau and the commissioner with more teeth to protect Canadians' interests.

The bill, as proposed, does a few small but important new things. It would provide the competition commissioner with the ability to seek restitution for consumer loss in case of false or misleading representation, for example, false advertising offers, those types of issues.

The bill introduces general administration monetary penalties for abuse of dominance in the industry. It would remove the airline specific provisions that were part of the act as a result of the Canadian Airlines and Air Canada merger thus returning the act to a law of general application. The legislation would increase the level of administrative monetary policies for deceptive marketing practices and decriminalize provisions in the act relating to pricing.

I want to mention the workings of the Competition Bureau and the struggle it is under in trying to do its job. The Competition Bureau is one of the smaller sectors in Industry Canada but has a very large mandate. At recent count, it employs just under 400 employees with an operating budget of $43.7 million in this fiscal year. Employees of the bureau and the commissioner are to be commended for their excellent work in dealing with record numbers of complaints this year. Consumer groups are confident and appreciative of the work that the new commissioner has been doing and we share their opinion. However, we have concerns as to whether the bureau will receive sufficient resources to do the job it is required to do with the new mandate assigned to it by the proposed legislation.

Officials at the bureau were upfront in their briefings. They have received budgetary relief to the end of 2006 to perform their duties, but additional responsibilities such as the administration of the new penalties as a result of decriminalization will cost money. If the government takes the issue of protecting consumers through a competition watchdog like the bureau seriously, it must make serious commitments to the bureau and provide adequate, sustained, long term funding.

I would like to mention a little bit in regard to consumer protection versus competition protection. Much of the language around the proposed bill is how these changes would benefit consumers. Most consumer groups agree that these are good changes. During the briefing on the bill officials from the competition bureau identified the problem of funding for consumer groups and the fact that it was difficult to do a good job protecting consumers' interests.

The Office of Consumer Affairs at Industry Canada is minute compared to even the relatively small competition bureau. The Office of Consumer Affairs employs only 23 people at this time with a budget of $2.6 million annually, where $1.7 million is for contributions to consumer interest organizations.

The federal government used to take protecting consumers' interests much more seriously. Prior to 1993 there was a department of consumer affairs. The department was folded up in government restructuring in the nineties. The department was reduced to a branch of Industry Canada in 1993 and, before the reduction in status, the federal government allocated $68 million and 968 person years to the bureau.

The government has plenty of opportunities to protect Canadian consumers from things like credit card gouging, giving full protection to the food we eat, endless telemarketing calls, protecting pensions and investors, and price hikes on cable and telephone bills. The competition bureau does not always have the mandate to follow up on this and even if it does, consumers should have access to one stop shopping, dealing with the issue of protecting their interests.

We look forward to the opportunity to discuss the bill further in committee. Where changes can be made to strengthen the bill we certainly intend to do so.

[Jerry Pickard, Liberal, Parliamentary Secretary to the Minister of Industry]

Mr. Speaker, it is with great pleasure that I open the debate on Bill C-19, an act to amend the Competition Act. I am looking forward to working with all members of the House in considering this vital piece of economic legislation.

As mentioned in the Speech from the Throne, the government wants to ensure that the up to date legislative framework for business is put in place, and some of the amendments in the Competition Act are deemed to move in that direction.

Bill C-19 would strengthen Canada's competition framework in a global economic partnership to benefit consumers, as well as businesses, both large and small. These amendments would also create a greater symmetry between our competition regime and those of our major trading partners we deal with on a daily basis. That is good for business, which is increasingly multinational, and it is also good for our economy.

Bill C-19 implements a number of key recommendations from the industry committee's comprehensive report, “A Plan to Modernize Canada's Competition Regime”. The legislation before us today will strengthen the act by: providing restitution for consumer loss resulting from false or misleading advertising; introducing a general administrative monetary penalty provision for abuse of dominance in any industry; removing the airline specific provisions from the act to return it to a law of general application; increasing the level of administrative monetary penalties for deceptive or misleading marketing practices; and decriminalizing the pricing provisions.

In recent years we have taken an incremental approach to changing this complex legislation. We have always been careful and measured and move forward with amendments to this bill with no exception. Bill C-19 balances the interests of businesses and consumers in a number of ways.

On the business side, for example, it moves us toward a law of general application by removing the airline specific provisions, as advocated by the industry committee's recommendations that have come forward. It also decriminalizes the pricing provisions in response to the committee's recommendations and long-standing requests from various business groups.

On the consumer side, for example, it ensures that Canadians will have access to remedies similar to those in other states we do business with. When they have lost money as a result of misleading representations, they have a chance to reclaim those losses.

Consumers need to have faith in the marketplace and it is to our advantage to make sure that faith is there. They expect to be reimbursed for losses resulting from false claims, and they should be. The proposal for restitution would add an important additional remedy for the courts in cases where consumers have lost money as a result of false or misleading representations.

The Competition Bureau regularly receives complaints from consumers who have lost money buying products that simply do not work. Based on advertisers' false or misleading representations, they lose their investment. Those who engage in such practices can gain an unfair advantage in the market as well. That is bad for our marketplace. It is bad for our consumers. A restitution remedy is an appropriate tool to address this situation.

We are proposing a general administrative monetary penalty regime, or AMPs, for abuse of dominance. This provision would be applicable to all industries and would ensure a level playing field among all participants, including the airline industry.

AMPs are used in a specific way to encourage compliance with the law in a number of jurisdictions. In fact, our act is one of the few in the world that does not allow a financial remedy in such cases. The introduction of AMPs for cases of abuse of dominance will make our competition regime more similar to its counterparts in other jurisdictions, including our major trading partners. The maximum penalty would be $10 million, and $15 million for each subsequent order under the new provisions.

In other words, we are proposing a balanced approach to improve the remedies available in this particular section of the act.

We are also proposing to remove the airline specific regime consisting of provisions found in the Competition Act and the airline regulations. The airline specific provisions were introduced in 2000 and 2002 following the merger of Canadian and Air Canada and provided the Competition Bureau with the tools regarding concerns over predatory conduct by a dominant airline.

The Canadian airline industry has changed significantly since that merger. We have seen a decline in Air Canada's dominant market share; the entry and growth of low cost carriers; the development of competing loyalty programs; the growth of the Internet as a means of distributing tickets; and the changing role of travel agents.

The current provisions are no longer required and should be replaced with the general regime which I just described. This change would have the benefit of returning the act to a law of general application, something recommended by the industry committee in 2002 and by numerous competition law experts.

Bill C-19 also proposes to increase the existing level of administrative monetary penalties, or AMPs, available under the deceptive marketing practices provisions. The current limitation for AMPs generally represents only a small fraction of the profits made by businesses through deceptive marketing practices.

The level of AMPs needs to be increased in order to encourage compliance with the Competition Act and stop deceptive marketing practices. It is appropriate to bring the limits of AMPs for cases of deceptive practices to a level that is consistent with that proposed for dominance. Accordingly, the maximum penalty proposed under these deceptive marketing provisions would be, for individuals, $750,000 and $1 million per subsequent order, and for corporations, $10 million and $15 million for subsequent orders.

Bill C-19 would also reform the pricing provisions dealing with price discrimination, geographic price discrimination, predatory pricing and promotional allowances. Bill C-19 would repeal these criminal provisions and bring them under the civil regime under the abuse of dominance provisions. This type of pricing behaviour would be best suited to a civil provision with a competition test if AMPs are available to deal with anti-competitive behaviour.

Canadians are being well served by our competition regime, which is among the most developed in the world. However, there is always room for improvement. Bill C-19 represents the latest step in an incremental legislative evolution that shows the government is committed to having a modern, effective Competition Act.

This legislative package is responsive to the recommendations of Parliament and industry, consumers and businesses. Taken together, these amendments would strengthen the Competition Act. They would effectively deter anti-competitive behaviour that is most harmful to the Canadian economy and Canadian consumers. They would promote legitimate pro-competitive business practices to ensure a competitive marketplace, one where consumers and businesses benefit from competitive practices, product choice and quality service.

Again let me say that I look forward to working with all members of the House on this. I hope everyone will look at this piece of legislation as vital to the economy of Canada and to our legislative agenda.

[Jean Lapierre, Liberal, for the Minister of Industry]

moved:

That Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts, be referred forthwith to the Standing Committee on Industry, Natural Resources, Science and Technology.

Questions on the Order Paper

[Some hon. members]

Agreed.

(Bill C-19. On the Order: Government Orders:)

November 2, 2004--The Minister of Industry--Second reading and reference to the Standing Committee on Industry, Natural Resources, Science and Technology of Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts.

Business of the House

[Tony Valeri, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, this afternoon, as hon. members know, we will continue with the opposition day debate.

Tomorrow we will begin with second reading of Bill C-9, the Quebec economic development bill. If that is concluded, we would then return to debate on the motion for reference before second reading of Bill C-16 respecting impaired driving. If there is still time remaining when that is concluded, we would consider a motion to refer to committee before second reading Bill C-18 respecting Telefilm.

As all hon. members know, next week is the Remembrance Week break. When the House returns on November 15, we will call at report stage and if possible third reading of Bill C-4 respecting the international air equipment protocol, and then bring forward Bill C-6 respecting public safety for report stage and third reading.

We would then return to any of the items already listed that have not been completed.

This will be followed by motions to refer to committee before second reading Bill C-19 respecting competition and Bill C-20 respecting first nations fiscal institutions.

We will then be consulting our friends opposite on the appropriate day that week to consider report stage and third reading of Bill C-7 respecting parks, a bill, I am informed, that is about to be reported from committee.

On Tuesday evening, November 16, the House will go into committee of the whole to consider the estimates of the Minister of Canadian Heritage.

Thursday, November 18 shall be an allotted day.

With respect to the specific question with regard to the motion mentioned by my hon. colleague across the way, it is government orders and it is a very important item. I know that we will bring that forward in the fullness of time.

Competition Act

[Andy Scott, Liberal, for the Minister of Industry]

moved for leave to introduce Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts.

(Motions deemed adopted, bill read the first time and printed)

Resumption of Debate on Address in Reply

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Mr. Speaker, it is a great pleasure to address the House today in response to the speech throne.

First, I would like to tell you I will be sharing my time with my new colleague from Richmond—Arthabaska.

I have examined among other things the section of the speech dealing with the environment, on pages 13 and 14. It is the only part of the speech I will comment on. The least I can say, after examining this section, is that the government lacks imagination. And not only that. It has also gone back to its old and what it considers legitimate ways of meddling slowly but relentlessly in provincial jurisdictions.

Here is an example I found on page 12:

The Government will work to get its own house in order. It will consolidate federal environmental assessments and will work with the provinces and territories toward aunified and more effective assessment process for Canada.

I would like to remind you that, in the past in Quebec, even under the Robert Bourassa government, this sort of approach was strictly forbidden, so that Ottawa would be prevented from invading provincial jurisdictions, more particularly as concerns environmental assessments.

I recall, among others, letters by Pierre Paradis, then Minister for the Environment. As early as 1990 he had written a number of letters to his colleague René de Cotret reminding him that the environmental assessment process Ottawa wanted to put in place was totally unacceptable.

Later, the Supreme Court ruled that environmental assessment came in part under federal jurisdiction. But in the following months, a report was released and a Supreme Court ruling handed down, namely in the Oldman case, reaffirming the jurisdiction of the federal government in the matter. The Quebec National Assembly unanimously denounced this attempt by the federal government to put in place a parallel environmental assessment process.

In March 1992, under the government of Robert Bourassa the National Assembly unanimously passed a resolution that said:

That the National Assembly strongly disapproves of the federal government bill--an Act to establish a federal environmental assessment process--because it is contrary to the higher interest of Quebec, and opposes its passage by the federal government.

On March 18, 1992, the National Assembly, with the support of every party, opposed this first attempt by the federal government to encroach on an area of shared jurisdiction. The Court is not a uniquely federal institution; it too is shared.

We would have hoped not to go back to square one with this proposal by the federal government to put in place one assessment process. I recall that the Quebec government of the day, as well as the ensuing ones, including those of the Parti Quebecois, hesitated a long time before signing an environmental assessment harmonization agreement with Ottawa. The hesitation was precisely because we feared then that Ottawa might use it as an excuse to put in place not a parallel process, but one for the whole country.

In May 2004, the Charest government decided to sign the harmonization agreement. Today, only a few months later, we are told that there will be only one environmental assessment process. How can we accept Ottawa's will to have only one process when ours is working quite well? In Quebec, the BAPE is responsible for environmental assessments. It is a transparent and consultative process recognized by all in Canada. It is the envy of some provinces.

But now, we are told that a unified assessment system will be introduced, which will be controlled by Ottawa. That is why environmental groups, which are not used to endless constitutional disputes, reacted the same day the throne speech was read, saying, “Environmentalists foresee constitutional dispute”.

Why? Because, like them, we believe, as we did in the past in debating bills like Bill C-19, that such interference was unacceptable and distorted the transparency efforts made by the federal government at the time.

I hope that the government, which is looking for asymmetry, will respect the harmonization accord signed in May 2004 and revert to a process allowing Quebec to have its own rules. I can assure the government today that, as this throne speech suggests, it dares go ahead and introduce a bill to officially establish a unified assessment process for all of Canada , we on this side of House will never support such an initiative, because it is contrary to Quebec's proven approach.

A second point raised in the throne speech concerns the Kyoto protocol. The government appears to be reverting to the good old approach of consulting with the people. The Speech from the Throne states that the government plans to implement the Kyoto principles “in a way that produces long-term and enduring results”.

I do not understand. Why mention the obligation of producing enduring results when the the time by which Canada has to have reduced its greenhouse gases is clearly indicated in the Kyoto protocol?

There is no mention of a long-term strategy in the Kyoto protocol. Canada must reduce its greenhouse gas emissions by 6% between 2008 and 2012. Why was the government not able to incorporate its time constraints into the throne speech, stating instead some vague intentions for the long term?

It is clear that what this government has tried to do is to yield to the pressures of western Canada, whose greenhouse gas emissions increased by 30%, while Quebec managed to reduce its own emissions to 4% and Ontario had an 11% increase. The government was quick to give in to the representations made by western Canada, even though that region has a huge energy potential and has not really implemented a greenhouse gas reduction strategy, as Quebec did in the nineties. Had Canada developed a real strategy, we would be in a position to achieve the objectives of the Kyoto protocol.

There is another aspect of the constitutional plan regarding which the Minister of Intergovernmental Affairs refused to answer my question yesterday. Considering that the provinces have a role to play in a cooperative process, how does the government explain the following statement on page 12 of the Speech from the Throne:

It will do so by refining and implementing an equitable national plan, in partnership with provincial and territorial governments and other stakeholders.

I remind the hon. member for Outremont, who has just arrived in this House, that, in the French version, they no longer refer to provinces, but to “administrations provinciales”. It is strange that, in the throne speech, there is no mention at all of an “administration fédérale”. Rather, they refer to the government, the federal government or Canada. However, they implicitly reduce the status of Quebec to that of a mere administration.

How can they do this? How can they present to us now, given this spirit of cooperation and the context of asymmetric federalism, a throne speech that reduces the provinces to mere administrations. This is totally unacceptable.

What is more, not only does this paragraph refer to provinces as mere “administrations”, but it makes no mention of a possible bilateral accord with Quebec for implementing the Kyoto protocol. There is not a single line on what is fundamental to us here in this House.

Indeed, in a sectoral strategy and approach, the federal government concludes agreements with the oil and petroleum industries, the basis of western Canada's economy. In a written agreement, they are told by the Prime Minister that they will be able to limit their reductions to 13%.

While the automobile sector is being told it will be exempt from the Kyoto protocol—the basis of Quebec's economy—nothing is being done for the manufacturing sector. No one is sitting down with Quebec to sign a bilateral accord. Quebec's environmental and economic interests are being compromised yet again. When you are the last one to negotiate, you are often forced to take whatever is left after the other provinces have had their say.

Their is no political will to sit down with Quebec to sign a bilateral accord, which we having been asking the federal government to do for three years now. Quebec's Minister of the Environment at the time, André Boisclair, had proposed this initiative to the federal government. The federal government is still having a hard time sitting down with the Government of Quebec. Rest assured, we will be vigilant in this matter—