Bill C-24 (Historical)

Softwood Lumber Products Export Charge Act, 2006

An Act to impose a charge on the export of certain softwood lumber products to the United States and a charge on refunds of certain duty deposits paid to the United States, to authorize certain payments, to amend the Export and Import Permits Act and to amend other Acts as a consequence

The purpose of this enactment is to implement some of Canada’s obligations under the Softwood Lumber Agreement between the Government of Canada and the Government of the United States, by imposing a charge on exports of certain softwood lumber products to the United States and on refunds of certain duty deposits paid to the United States and by amending certain Acts, including the Export and Import Permits Act. The charge on exports will take effect on October 12, 2006 and will be payable by exporters of softwood lumber products. The enactment also authorizes certain payments to be made.

Softwood Lumber Products Export Charge Act, 2006

[The Acting Speaker, Andrew Scheer]

I remind the hon. member for Western Arctic that we do not refer to other hon. members by name, but just by their title or riding.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, the NAFTA promise of secure access to the U.S. market was never anything but an illusion. Nothing but shreds remain of a guarantee of an end to arbitrary U.S. tariffs, yet the takeover of our industries continues apace, from retail to beef, from manufacturing to energy.

NAFTA prohibits the imposition of an export tax on energy or on basic petrochemicals that exceed those applicable to domestic consumption. That is article 605(b). When coupled with quantitative control prohibitions of GATT article XI, this ban on export taxation effectively and entirely removes government control of energy exports.

Not long ago we had a made in Canada price for energy, Canadian oil and gas companies were the primary people in the industry, and a 25 year reserve of gas was set aside for Canada's future needs. That is no longer the case.

The impact of the Alliance pipeline on our gas industry was huge. Yes, it brought immediate wealth to Alberta and British Columbia, but it also exported all the liquids that we need for our petrochemical industry in Edmonton, in the heartland of our oil and gas industry, and now we are short of those. We will see plant shutdowns soon. Just like the export of raw logs, when we export raw energy, as the Alliance pipeline does, down to factories in Chicago, we are exporting jobs south of the border. We are taking them out of the Canadian perspective.

No other country in the world in a time of peace has signed away so completely its energy resources, present and future. Canada, interestingly enough, is the only NAFTA country prevented by the energy exporting provisions in NAFTA. Four years ago the U.S. adopted a national energy policy that emphasized national energy security, self-sufficiency and even support for domestically owned firms. Canada, meanwhile, is required by NAFTA to continue exporting oil and gas to the U.S., even if it experiences shortages.

The interesting development was the liquefied natural gas terminals in Quebec where the company is talking about security of supply with two forms of energy, but when we look at the company's plan, the natural gas that is flowing to Quebec right now will be diverted to the United States once the LNG terminals are in place. Where is the security in that?

The Mexican energy sector under the agreement does not parallel that between Canada and the U.S. because Mexico protected its energy industry. Mexico's actions are given respect in the United States. To quote from the U.S. national energy task force report, “Mexico will make its own sovereign decisions on the breadth, pace and extent to which it will expand and reform its electricity, oil and gas capacity”.

Integrating our energy and our economy into that of the U.S. means it is subject to U.S. ownership, decisions, priorities and prices. That is exactly what the softwood lumber deal means to our forest industry. The pattern continues. It was started by the Liberals and is continued by the Conservatives. Let us not wait until our industries and agriculture become completely uncompetitive, until Canadians are left begging for their own energy at 40° below. We need to really look at this deal very carefully. This deal represents a further step down that slippery slope that leads to deep integration of our economies and the loss of Canadian sovereignty, jobs and a secure resource base.

As a northerner, I probably live further away from the U.S. border than most people in this chamber. I feel secure in some ways there, but I do not feel secure when I come into this House of Commons and see the people who are representing Canada making decisions for short term benefit and political gain, and forgetting the long term implications to this country and to our sovereignty, which our fathers, grandfathers and great-grandfathers fought to first obtain and then continue to uphold.

John Diefenbaker would be turning over in his grave right now if he knew what these Conservatives were doing to our country. They are following the Liberal pattern. The Liberals were great at continentalism, always have been. Now all of a sudden we have them all together. I hope Canadians in the next election really realize that we have Tweedledee and Tweedledum when it comes to protecting Canadian sovereignty in this country.

[The Acting Speaker, Andrew Scheer]

I would just remind all hon. members that cellphones are not to be used in the House. They often disrupt those giving speeches.

Questions and comments, the hon. member for Burnaby--Douglas.

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

Mr. Speaker, I want to thank my colleague from Western Arctic for his speech this afternoon. I know that, as someone from a resource area of Canada, he understands the importance of a deal like this and how bad this deal is for Canada.

I wanted to ask him about the $1 billion in illegally collected levies that we give up under the provisions of this deal, that we pass on to the Americans for their use. We have already talked earlier this afternoon about the money that goes to the U.S. Coalition for Fair Lumber Imports to pursue its protectionist ways, but the other half of that $1 billion goes directly to the White House.

Ostensibly, it is for educational and charitable causes in timber-reliant communities, initiatives related to low income housing and disaster relief, and education and public interest projects addressing forest management issues, but it has been reported widely, and many of us I think agree, that this is really just a slush fund for electing more republican protectionists to Congress in the United States.

It is rather ironic that Canada would agree to establishing that kind of slush fund for the Bush White House, to elect more members to Congress who believe in the things that they believe in. I wonder if the member for Western Arctic might comment on that.

I also think it is rather ironic, and I have used that word a number of times this afternoon, that in the course of this deal there is half a billion dollars for support to American forestry communities, apparently, but there is absolutely nothing in here for support to Canadian communities that have been so devastated by this agreement and by this attack on our industry.

I wonder if he might comment on those issues.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, the member's question triggered in my mind one of the reasons why I worked so very hard to get into Parliament, which was the deal that was struck between multinational diamond companies and the Canadian government on the diamond resources in the north.

What a giveaway we had there. The Liberal Party, in its wisdom when it was in power, chose to give that industry carte blanche in the treatment of our resource there, and certainly as a northerner I railed against that for many years.

However, that is symptomatic of the larger problem. Canadians are wealthy in resources right now and we are willing to sell them off at the lowest price to maintain political promise.

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

Some of us are.

[Dennis Bevington, NDP, Western Arctic, NT]

Yes, some of us are. This $1 billion that is in the hands of the United States now, I am sure will be used for purposes that are not favourable to Canada. If this deal goes ahead, that is the reality of it, and that reality is an unfortunate reality.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, I want to thank the member for Western Arctic for his intervention. He is very passionate about justice in the House of Commons.

I wanted to specifically ask him about the lack of process around this bill. One of the things that the member for Burnaby—New Westminster had been calling for, for a number of weeks now, was a process around hearings in this country.

The idea was to take the committee out to key communities in Quebec, northern Ontario and British Columbia to actually meet with people to talk about what the impact this would have on their communities, their industries, their municipalities, their workers and first nations.

I wonder if the member could comment about the fact that this has not been done. What will the impacts be in terms of the validity of this bill?

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I had the opportunity for a number of years to sit on the Mackenzie Valley Environmental Impact Review Board where we looked at projects and conducted public hearings on a variety of issues.

In the north, which is quite a colonial state still, the federal government took the recommendations we had and basically ignored them. Apart from that, it is really vital that the public interest in each province and in the territories in economics is understood by the population. The population has the ability, whether it is small business, aboriginal people, or whoever it is, to understand the kinds of decisions that we are making and how they impact on their lives. That is a fundamental aspect of the democratic system.

Interestingly enough, often when we do environmental assessments, we move into economics and find out some of the answers. Therefore, the public hearing process would have helped the government gain a backbone and it would have also helped Canadians.

[Catherine Bell, NDP, Vancouver Island North, BC]

Mr. Speaker, I am glad to have the opportunity to speak again about my concerns and the concerns that have been expressed to me in the riding of Vancouver Island North about how this softwood lumber deal is bad for Canada.

I want to reiterate that the Conservatives campaigned on getting tough with the Americans and standing up for Canada and Canadian interests, but instead they got tough with the Canadian lumber companies. With the signing of this deal, the Conservatives have negotiated away all of Canada's wins at the NAFTA tribunals and put workers and communities in jeopardy. So many of those communities are in my riding and are suffering because of this deal.

After five years of legal battles under NAFTA and the U.S. Court of International Trade, the CIT ruled that Canada was entitled to the return of every penny of the $5.3 billion owed, every penny. That is the amount of illegally imposed duties of our softwood exports over the years. Again, we won.

Why would the government sellout Canadian manufacturers and communities, and capitulate to the pressure of the U.S. government and the lumber lobbyists? Why did the government snatch defeat from the jaws of victory?

The fact is that the recent court ruling, which I might add came only last Friday, is rendered a moot point due to this bad softwood lumber agreement. This agreement should go down in the history of Canada as one very shameful moment for the government. We just gave away $1 billion. I guess it is just one more way the government trims the fat. It seems to like to do that. Its rush to appease the U.S. lumber lobbyists has sold out ordinary Canadians, especially those who live and work in forest dependent communities.

The other irony about all of this is that about $500 million of Canadian money will go to the U.S. That is $.5 billion to the Coalition for Fair Lumber Imports. This money will most likely be used to rekindle the coalition, which is failing, and at some point in the future we will have to fight the U.S. again and it will be with our money.

It will be using our money to fight us. It is a sad irony. What a sellout. Why would anyone agree to this when it is our duty as members of Parliament to stand up for our constituencies and communities, all of whom happen to be Canadian? They are in our ridings.

Let me provide a few other reasons why this is a bad deal, besides the fact that it is based on a falsehood that Canadian softwood lumber industries are subsidized. This falsehood was exposed and rejected in every NAFTA and U.S. commercial court ruling that clearly sided with Canadian industry.

Another reason this is a bad deal is that it can be cancelled unilaterally at any time. It does not go on for seven years. It could last only two years or even 18 months and does not provided stability and predictability to the Canadian softwood lumber industry. This deal constrains trade unreasonably by applying punitive tariffs and quotas that hinder the flexibility of the Canadian softwood industry.

I want to talk about a small flooring manufacturing company in my riding that is devastated by this agreement. It has told me it is going to be losing over $300,000 a year in revenues because it cannot find a way under this deal as it stands to do business with the U.S. It is going to be shut out. It is a small company and is going to lose out because of this deal.

It will be the dozen or so people who work in small businesses in my community who will probably lose their jobs if this deal goes ahead. Small businesses are very concerned about their future. It is a bad deal because it does not respect small businesses.

The deal kills the credibility of the NAFTA dispute settlement mechanism. Canada won in the courts but by negotiating away all of those wins we have put the dispute mechanism in jeopardy. We might as well say that we did not need it. We capitulate in a heartbeat.

It sets a bad precedent, not only for the softwood lumber industry, but also for other industrial sectors in this country. If the government can capitulate to the Americans on softwood, what can it do in other sectors that are governed by NAFTA? Will we see this again in other industries? It is a bad deal.

The deal does nothing for the thousands of workers who have lost their livelihoods over the past five years. My colleagues and I in the NDP called for loan guarantees from the government so that the industries in our communities could get through this and maintain some of the workers. However, that did not happen. Many of the industries had to lay off workers and many are now gone because of this deal. We also see a further job loss through consolidation caused by the quotas and export taxes.

I have another reason for talking about this agreement. This softwood lumber agreement creates an incentive for exporting raw logs. I live on Vancouver Island and I when I drive up and down the Island highway I see truckload after truckload of raw logs leaving the Island and going to a log dump. We used to have a lot of small mills, mills that were the backbone and the lifeblood of so many small communities. These mills kept those communities going because the logs were tied to the communities. This is not happening any more. This deal does nothing to stop these logs from being exported out of our communities and out of the country. The logs are being processed offshore and in the U.S. Those are family supporting jobs that we have lost in our communities. That is not standing up for our communities.

This continued export of raw logs has to stop. I have spoken about this in my communities and everywhere I go people agree that this is something that has to end. For that reason alone, I would think that people would not support this deal.

This deal does not provide effective protection for Atlantic Canada. The softwood lumber agreement has a fundamental and irreversible impact on the ability of Canada to defend itself within NAFTA and the United States commercial court system. The agreement makes everyone substantially more vulnerable, notwithstanding the Atlantic exemption. The renewal of the exemption is not a guarantee against failure in the future. The Atlantic provinces are still vulnerable to subsidy allegations. There will be nothing to stop the U.S. from alleging that Atlantic Canadians are not living up to this deal.

This is a bad deal because I know much of the industry was not on side. It was pressured into supporting this deal and a lot of bullying tactics went on. Many industries felt forced into signing on to this deal. A lot of them actually did not sign on, but were pressured anyway. I am really standing up for those people in those industries, for the workers in our communities and for the communities in my riding and across this country that will be devastated by this deal.

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

Mr. Speaker, when the committee looked at this legislation this past summer it agreed that there should be public hearings in Quebec, in northern Ontario and in British Columbia but those hearings are not going ahead.

I wonder if the member could comment on the fact that there have not been public hearings on this deal or on this legislation.

[Catherine Bell, NDP, Vancouver Island North, BC]

Mr. Speaker, it is shameful that the hearings, which the committee agreed to, have not gone ahead. It is quite annoying that the kibosh was put on them because we should have heard from Canadians in all communities about how bad this deal was and how it was affecting them.

[The Acting Speaker, Andrew Scheer]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker, Andrew Scheer]

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