Bill C-4 (Historical)

Economic Action Plan 2013 Act No. 2

A second act to implement certain provisions of the budget tabled in Parliament on March 21, 2013 and other measures

Part 1 implements certain income tax measures proposed in the March 21, 2013 budget. Most notably, it
(a) increases the lifetime capital gains exemption to $800,000 and indexes the new limit to inflation;
(b) streamlines the process for pension plan administrators to refund a contribution made to a Registered Pension Plan as a result of a reasonable error;
(c) extends the reassessment period for reportable tax avoidance transactions and tax shelters when information returns are not filed properly and on time;
(d) phases out the federal Labour-Sponsored Venture Capital Corporations tax credit;
(e) ensures that derivative transactions cannot be used to convert fully taxable ordinary income into capital gains taxed at a lower rate;
(f) ensures that the tax consequences of disposing of a property cannot be avoided by entering into transactions that are economically equivalent to a disposition of the property;
(g) ensures that the tax attributes of trusts cannot be inappropriately transferred among arm’s length persons;
(h) responds to the Sommerer decision to restore the intended tax treatment with respect to non-resident trusts;
(i) expands eligibility for the accelerated capital cost allowance for clean energy generation equipment to include a broader range of biogas production equipment and equipment used to treat gases from waste;
(j) imposes a penalty in instances where information on tax preparers and billing arrangements is missing, incomplete or inaccurate on Scientific Research and Experimental Development tax incentive program claim forms;
(k) phases out the accelerated capital cost allowance for capital assets used in new mines and certain mine expansions, and reduces the deduction rate for pre-production mine development expenses;
(l) adjusts the five-year phase-out of the additional deduction for credit unions;
(m) eliminates unintended tax benefits in respect of two types of leveraged life insurance arrangements;
(n) clarifies the restricted farm loss rules and increases the restricted farm loss deduction limit;
(o) enhances corporate anti-loss trading rules to address planning that avoids those rules;
(p) extends, in certain circumstances, the reassessment period for taxpayers who have failed to correctly report income from a specified foreign property on their annual income tax return;
(q) extends the application of Canada’s thin capitalization rules to Canadian resident trusts and non-resident entities; and
(r) introduces new administrative monetary penalties and criminal offences to deter the use, possession, sale and development of electronic suppression of sales software that is designed to falsify records for the purpose of tax evasion.
Part 1 also implements other selected income tax measures. Most notably, it
(a) implements measures announced on July 25, 2012, including measures that
(i) relate to the taxation of specified investment flow-through entities, real estate investment trusts and publicly-traded corporations, and
(ii) respond to the Lewin decision;
(b) implements measures announced on December 21, 2012, including measures that relate to
(i) the computation of adjusted taxable income for the purposes of the alternative minimum tax,
(ii) the prohibited investment and advantage rules for registered plans, and
(iii) the corporate reorganization rules; and
(c) clarifies that information may be provided to the Department of Employment and Social Development for a program for temporary foreign workers.
Part 2 implements certain goods and services tax and harmonized sales tax (GST/HST) measures proposed in the March 21, 2013 budget by
(a) introducing new administrative monetary penalties and criminal offences to deter the use, possession, sale and development of electronic suppression of sales software that is designed to falsify records for the purpose of tax evasion; and
(b) clarifying that the GST/HST provision, exempting supplies by a public sector body (PSB) of a property or a service if all or substantially all of the supplies of the property or service by the PSB are made for free, does not apply to supplies of paid parking.
Part 3 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 3 amends the Employment Insurance Act to extend and expand a temporary measure to refund a portion of employer premiums for small businesses. It also amends that Act to modify the Employment Insurance premium rate-setting mechanism, including setting the 2015 and 2016 rates and requiring that the rate be set on a seven-year break-even basis by the Canada Employment Insurance Commission beginning with the 2017 rate. The Division repeals the Canada Employment Insurance Financing Board Act and related provisions of other Acts. Lastly, it makes technical amendments to the Employment Insurance (Fishing) Regulations.
Division 2 of Part 3 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to remove the prohibition against federal and provincial Crown agents and federal and provincial government employees being directors of a federally regulated financial institution. It also amends the Office of the Superintendent of Financial Institutions Act and the Financial Consumer Agency of Canada Act to remove the obligation of certain persons to give the Minister of Finance notice of their intent to borrow money from a federally regulated financial institution or from a corporation that has deposit insurance under the Canada Deposit Insurance Corporation Act.
Division 3 of Part 3 amends the Trust and Loan Companies Act, the Bank Act, the Insurance Companies Act and the Cooperative Credit Associations Act to clarify the rules for certain indirect acquisitions of foreign financial institutions.
Division 4 of Part 3 amends the Criminal Code to update the definition “passport” in subsection 57(5) and also amends the Department of Foreign Affairs, Trade and Development Act to update the reference to the Minister in paragraph 11(1)(a).
Division 5 of Part 3 amends the Canada Labour Code to amend the definition of “danger” in subsection 122(1), to modify the refusal to work process, to remove all references to health and safety officers and to confer on the Minister of Labour their powers, duties and functions. It also makes consequential amendments to the National Energy Board Act, the Hazardous Materials Information Review Act and the Non-smokers’ Health Act.
Division 6 of Part 3 amends the Department of Human Resources and Skills Development Act to change the name of the Department to the Department of Employment and Social Development and to reflect that name change in the title of that Act and of its responsible Minister. In addition, the Division amends Part 6 of that Act to extend that Minister’s powers with respect to certain Acts, programs and activities and to allow the Minister of Labour to administer or enforce electronically the Canada Labour Code. The Division also adds the title of a Minister to the Salaries Act. Finally, it makes consequential amendments to several other Acts to reflect the name change.
Division 7 of Part 3 authorizes Her Majesty in right of Canada to hold, dispose of or otherwise deal with the Dominion Coal Blocks in any manner.
Division 8 of Part 3 authorizes the amalgamation of four Crown corporations that own or operate international bridges and gives the resulting amalgamated corporation certain powers. It also makes consequential amendments and repeals certain Acts.
Division 9 of Part 3 amends the Financial Administration Act to provide that agent corporations designated by the Minister of Finance may, subject to any terms and conditions of the designation, pledge any securities or cash that they hold, or give deposits, as security for the payment or performance of obligations arising out of derivatives that they enter into or guarantee for the management of financial risks.
Division 10 of Part 3 amends the National Research Council Act to reduce the number of members of the National Research Council of Canada and to create the position of Chairperson of the Council.
Division 11 of Part 3 amends the Veterans Review and Appeal Board Act to reduce the permanent number of members of the Veterans Review and Appeal Board.
Division 12 of Part 3 amends the Canada Pension Plan Investment Board Act to allow for the appointment of up to three directors who are not residents of Canada.
Division 13 of Part 3 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to extend to the whole Act the protection for communications that are subject to solicitor-client privilege and to provide that information disclosed by the Financial Transactions and Reports Analysis Centre of Canada under subsection 65(1) of that Act may be used by a law enforcement agency referred to in that subsection only as evidence of a contravention of Part 1 of that Act.
Division 14 of Part 3 enacts the Mackenzie Gas Project Impacts Fund Act, which establishes the Mackenzie Gas Project Impacts Fund. The Division also repeals the Mackenzie Gas Project Impacts Act.
Division 15 of Part 3 amends the Conflict of Interest Act to allow the Governor in Council to designate a person or class of persons as public office holders and to designate a person who is a public office holder or a class of persons who are public office holders as reporting public office holders, for the purposes of that Act.
Division 16 of Part 3 amends the Immigration and Refugee Protection Act to establish a new regime that provides that a foreign national who wishes to apply for permanent residence as a member of a certain economic class may do so only if they have submitted an expression of interest to the Minister and have subsequently been issued an invitation to apply.
Division 17 of Part 3 modernizes the collective bargaining and recourse systems provided by the Public Service Labour Relations Act regime. It amends the dispute resolution process for collective bargaining by removing the choice of dispute resolution method and substituting conciliation, which involves the possibility of the use of a strike as the method by which the parties may resolve impasses. In those cases where 80% or more of the positions in a bargaining unit are considered necessary for providing an essential service, the dispute resolution mechanism is to be arbitration. The collective bargaining process is further streamlined through amendments to the provision dealing with essential services. The employer has the exclusive right to determine that a service is essential and the numbers of positions that will be required to provide that service. Bargaining agents are to be consulted as part of the essential services process. The collective bargaining process is also amended by extending the timeframe within which a notice to bargain collectively may be given before the expiry of a collective agreement or arbitral award.
In addition, the Division amends the factors that arbitration boards and public interest commissions must take into account when making awards or reports, respectively. It also amends the processes for the making of those awards and reports and removes the compensation analysis and research function from the mandate of the Public Service Labour Relations Board.
The Division streamlines the recourse process set out for grievances and complaints in Part 2 of the Public Service Labour Relations Act and for staffing complaints under the Public Service Employment Act.
The Division also establishes a single forum for employees to challenge decisions relating to discrimination in the public service. Grievances and complaints are to be heard by the Public Service Labour Relations Board under the grievance process set out in the Public Service Labour Relations Act. The process for the review of those grievances or complaints is to be the same as the one that currently exists under the Canadian Human Rights Act. However, grievances and complaints related specifically to staffing complaints are to be heard by the Public Service Staffing Tribunal. Grievances relating to discrimination are required to be submitted within one year or any longer period that the Public Service Labour Relations Board considers appropriate, to reflect what currently exists under the Canadian Human Rights Act.
Furthermore, the Division amends the grievance recourse process in several ways. With the sole exception of grievances relating to issues of discrimination, employees included in a bargaining unit may only present or refer an individual grievance to adjudication if they have the approval of and are represented by their bargaining agent. Also, the process as it relates to policy grievances is streamlined, including by defining more clearly an adjudicator’s remedial power when dealing with a policy grievance.
In addition, the Division provides for a clearer apportionment of the expenses of adjudication relating to the interpretation of a collective agreement. They are to be borne in equal parts by the employer and the bargaining agent. If a grievance relates to a deputy head’s direct authority, such as with respect to discipline, termination of employment or demotion, the expenses are to be borne in equal parts by the deputy head and the bargaining agent. The expenses of adjudication for employees who are not represented by a bargaining agent are to be borne by the Public Service Labour Relations Board.
Finally, the Division amends the recourse process for staffing complaints under the Public Service Employment Act by ensuring that the right to complain is triggered only in situations when more than one employee participates in an exercise to select employees that are to be laid off. And, candidates who are found not to meet the qualifications set by a deputy head may only complain with respect to their own assessment.
Division 18 of Part 3 establishes the Public Service Labour Relations and Employment Board to replace the Public Service Labour Relations Board and the Public Service Staffing Tribunal. The new Board will deal with matters that were previously dealt with by those former Boards under the Public Service Labour Relations Act and the Public Service Employment Act, respectively, which will permit proceedings under those Acts to be consolidated.
Division 19 of Part 3 adds declaratory provisions to the Supreme Court Act, respecting the criteria for appointing judges to the Supreme Court of Canada.

Economic Action Plan 2013 Act No. 2

[Hoang Mai, NDP, Brossard—La Prairie, QC]

Mr. Speaker, I thank my colleague for his speech. It was a privilege to work with him on the Standing Committee on Finance. In addition to being an economist, he is our deputy critic for finance and also for international trade. This shows how much we trust in his expertise and his skills.

I would like my colleague to tell us about the macroeconomic impact of the upcoming budget. Since the Conservative government came to power, Canada has lost 400,000 jobs in the manufacturing sector, among other things. In addition, personal household debt increased, rising to 166%. This is a veritable attack on Canadians.

Could the member please describe the impact of austerity on the Canadian economy and on Canadians?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I am grateful for the question because it allows me to elaborate.

In its interventions, the government always talks about the number of jobs that have been created since July 2009. Yes, jobs have been created. However, we were in the depths of the recession in July 2009, which explains the job numbers.

I want to point out two things about these numbers. First, when this government was in opposition, it kept saying that governments do not create jobs. However, this government is taking all the credit for job creation since the depths of the recession, to which it had a delayed reaction.

What is more, if we compare job creation to demographic growth or if we include demographic growth in the equation, we have more unemployed workers today than we did before the recession.

The government's policies are about one thing only, and that is taxation. Lower taxes is the government's leitmotif.

Making good investments can be more advantageous than tax cuts because of the multiplier effect. The Parliamentary Budget Officer and now the International Monetary Fund are deploring the adverse effect that the Conservative government's cuts and austerity measures are having on economic growth.

I hope that the government will take note of that in its next economic forecast.

[The Acting Speaker, Barry Devolin]

The time provided for government orders has now expired. We will now proceed to statements by members.

The House resumed consideration of the motion that Bill C-4, A second act to implement certain provisions of the budget tabled in Parliament on March 21, 2013 and other measures, be read the third time and passed.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is interesting to rise today to speak to Bill C-4. There is so much that could be said about the bill that limiting one to only 20 minutes does somewhat of a disservice because of the amount of content in the bill. It can be a challenge to take into consideration the numerous pieces of legislation that have been incorporated into Bill C-4.

There are probably five or six points I want to emphasize, but I will start off with regard to the government's attitude toward presenting budget bills. Canadians are becoming more and more aware of the majority Conservative style of governance in the House, which has been very disrespectful in terms of democracy. Democracy in the House of Commons has been lacking in allowing for proper diligent debate and proceedings on a wide spectrum of different issues.

We have witnessed the Prime Minister and the instructions he has given to the PMO that the best way to pass legislation under the Conservative majority is to start compiling it, submit it to the PMO and it will be bundled altogether, forwarded to the Minister of Finance and be brought in through budget legislation.

Not to be outdone by previous budgets like this under the same Conservative majority, this time not only did the Conservatives prorogue the session by limiting the number of days we would sit this fall, but they also once again put in time allocation on this legislation. It is so very bizarre and very undemocratic.

Unfortunately, we have found that the Prime Minister, through the Prime Minister's Office, has done a great disservice by not allowing for legitimate debate on a wide variety of issues. I plan to touch base on a number of those.

Things have really changed for the Prime Minister. I was provided a very interesting quote. I may have said this in the past. I have had opportunity to do so because it was last year around this time when we had another mega budget bill. Let there be no doubt before I cite the quote that it is important to recognize that no prime minister in the history of our country has taken such liberties in bringing so much legislation forward under one budget bill.

Let us reflect on the days when the Prime Minister was in opposition. What did he have to say about legislation of this nature? I quote what the Prime Minister said in the House of Commons:

We can agree with some of the measures but oppose others. How do we express our views and the views of our constituents when the matters are so diverse? Dividing the bill into several components would allow members to represent views of their constituents on each of the different components in the bill.

He asked government members in particular to worry about the implications of omnibus bills for democracy and the functionality of Parliament.

That is what he said when he was talking about a bill that was just over 100 pages long. This is the Prime Minister who has introduced thousands of pages through a few budget bills, effectively changing 100-plus pieces of legislation with a few budget bills.

That is why it is an assault on democracy. It is an assault on the House of Commons, the manner in which the majority Conservative/Reform government has brought forward budget legislation. The Prime Minister needs to take responsibility for what takes place within his cabinet and his government. There is no doubt in my mind that he does rule the Prime Minister's Office and that he is very much aware.

That bring me to the next topic. We know why the Prime Minister prorogued the session back in September. It was because he did not want to have the House sitting. He avoided the day in and day out accountability in the House, because he was not happy with what was being reported in a sequence of events that portrayed corruption and fraud in the Prime Minister's Office.

As a result, we lost weeks of debate earlier this fall because the Prime Minister did not want to come back. Why did he not want to come back? He had a very serious problem, and still does, and it is not going to go away. It is going to continue to be there and it will ultimately be dragged out, all the way to the next federal election in 2015.

There is so much more that has not been disclosed. We will ultimately ensure that we get more information as we sit, because Canadians deserve to know the honest truth, the full truth in what has taken place in regard to the scandal in and around the Prime Minister's Office.

I pointed this out to a number of individuals in looking at the Prime Minister's actions and trying to understand them. All those people are around the Prime Minister are so close to him. There was the Prime Minister's chief of staff, Nigel Wright. This individual had the ears of the Prime Minister on a daily basis. He in essence paid off a $90,000 debt that was owed by Senator Mike Duffy.

The Prime Minister likes to say that he had taken corrective actions. We are not too sure if, after it became public, what Nigel Wright, the Prime Minister's chief of staff, did but within days of when it became public he was no longer the chief of staff.

There were no RCMP charges or anything of that nature. It just became public. The chief of staff at least acknowledged that something wrong had been done. We do not know if he was actually fired or released or took it upon himself to leave. We do not know, or at least it is not clear. It is one of the things the Prime Minister has not been very clear on.

What we do know is that he has not been consistent.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

How is this relevant to the discussion?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

What about the most recent questions—

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

We are talking about the budget.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, there are a series of questions that we have in regard to Mr. Gerstein.

When we look at what has happened with Mr. Gerstein and we do the contrast between Nigel Wright and Senator Gerstein, we have to wonder why the Prime Minister has not done anything in regard to that.

It seems there is a different standard of testing of a moral compass. We just do not know what the PMO is doing on this. Staff members who worked in the PMO and who were directly involved in the conflict or scandal now work for other ministers.

All of this has stolen a great deal of attention away from what should be talked about a whole lot more, and that is in fact the budget and the impact, from our perspective, that these budgetary measures are taking on the middle class in Canada. That has been a huge priority for the leader of the Liberal Party and the Liberal Party as a whole, holding the government accountable on the issue of the middle class and how the government's policy has not been in the interest of those people.

However, it has been overshadowed because of the scandal that has been taking place inside the Prime Minister's Office. This is the reason why—

[The Acting Speaker, Dan Albas]

The hon. member for Kootenay—Columbia.

[David Wilks, Conservative, Kootenay—Columbia, BC]

Mr. Speaker, the member has not alluded much to Bill C-4 and that is what we are debating. Could you get him to come back on track, please?

[The Acting Speaker, Dan Albas]

I will inform the member that the tradition of this place is to allow members to have a wide amount of discretion. I imagine the member will continue his speech on the theme of the debate.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, if the member were to reflect on the last two paragraphs prior to him standing, I was talking about the budget. It was absolutely relevant.

I can appreciate that the Conservative members are very sensitive about what is taking place in the Prime Minister's Office. I know if I were them, I would be. I would want answers to many questions. I sense it at the doors of people's homes in my own constituency. I have had the opportunity to knock on a lot of doors in the last couple of months and to have a lot of discussions with many of my constituents. It is a very genuine and serious concern, and we still do not know the full truth. I hope the Prime Minister and the PMO will see the merit of taking advantage of the offer that was suggested by the member for Avalon with regard to having individuals testify before an ethics committee.

With regard to the issues within the budget, I made reference at the beginning of my speech to the size of the bill and the different types of legislation that are being incorporated into Bill C-4—

[The Acting Speaker, Barry Devolin]

The hon. member for Prince George—Peace River is rising on a point of order.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Mr. Speaker, as my colleague mentioned, I do not see much relevance to Bill C-4 in the member's speech, frankly. It was mentioned once before that the speech should be kept relevant. One obligation we have in this place is to keep the debate relevant to the topic at hand. I would ask you to ensure that happens, Mr. Speaker.