Bill S-2 (Historical)

Strengthening Motor Vehicle Safety for Canadians Act

An Act to amend the Motor Vehicle Safety Act and to make a consequential amendment to another Act

This enactment amends the Motor Vehicle Safety Act for the purpose of strengthening the enforcement and compliance regime to further protect the safety of Canadians and to provide additional flexibility to support advanced safety technologies and other vehicle innovations. It provides the Minister of Transport with the authority to order companies to correct a defect or non-compliance and establishes a tiered penalty structure for offences committed under the Act. The enactment also makes a consequential amendment to the Transportation Appeal Tribunal of Canada Act.

Strengthening Motor Vehicle Safety for Canadians Act

[Robert Aubin, NDP, Trois-Rivières, QC]

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

I agree with a number of aspects of his presentation, but there is one that truly stands out for me.

In his opinion, is this about optics or can this bill truly make a difference? We cannot seem to get any assurances that the budget cuts at Transport Canada are a thing of the past nor is anyone willing to say that major reinvestment is needed for implementing the merits of Bill S-2.

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Speaker, I will be sharing my time today with the hon. member for Medicine Hat—Cardston—Warner.

Before I begin, I would like to mention that it has been almost two years since the passing of my friend's predecessor Jim Hillyer. This summer I had the absolute pleasure of having Jim's son, London Hillyer, as our intern. I want to let Jim know upstairs that his son London did a fantastic job and he would be very proud of him.

I am pleased to rise today to talk to Bill S-2, an act to amend the Motor Vehicle Safety Act. Like many people in the House today we generally support the intent of the bill.

Presently, the Motor Vehicle Safety Act limits the power of the Minister of Transport to issuing notices of safety defects and criminally prosecuting manufacturers.

Transport Canada does not presently have the authority to order recalls, but rather to list active recalls on its website and issue press releases if it believes there is an issue with a type or model of a vehicle.

Bill S-2 would amend the act to provide the minister with the authority to order a vehicle recall and order the vehicle's manufacturer to correct the defect at no cost to the consumer. So far, so good.

An hon. Conservative senator from Newfoundland amended the legislation to ensure that vehicle manufacturers would be responsible for costs to protect car dealers from shouldering the costs of a vehicle recall. We have many car dealerships in Edmonton West. I have spoken to several of these dealers and they are 100% behind the amendment, of course, because it would save them money. I generally agree with parts of the amendment, but not where the amendment starts to set out compensation guidelines. That is best left to the market to decide.

I support legislation that will protect consumers from unnecessary and unfair financial burdens of defective products. It should not fall to a consumer, nor really the car dealer, to assume the cost of manufacturer defects, particularly with something like vehicles, which have potentially fatal consequences if something goes wrong. I also support legislation that is designed to keep consumers informed of any real or potential dangers with the equipment they choose to purchase.

The Auditor General report on Transport Canada, entitled “Oversight of Passenger Vehicle Safety”, lists two positive items on Bill S-2. One is a proposed new regulatory power to establish an information reporting requirement that would identify safety defects sooner. The Auditor General report also notes a positive part of Bill S-2 that would require companies operating in Canada to be more aware of foreign defects and issues of non-compliance for vehicles that would be similar to those sold in Canada.

That said, I have a few concerns with Bill S-2 as it is outlined and I will elaborate on them now.

The government's justification for the legislation is, to be charitable, a bit underwhelming. Per the words of the government's representative in the other place, it is because vehicles are complex and sophisticated, and much of the technology is proprietary.” No kidding.

Bill S-2 would give the minister new powers on ordering companies to conduct tests, analyses, or studies on vehicles or equipment at the minister's discretion; just at the minister's discretion, with no parameters, no guidelines.

I want to stop and take a look at what is going on with Boeing and Bombardier. The government is putting jobs at risk, investment at risk and has politicized the replacement of needed equipment for our men and women in uniform to protect its friends in Bombardier, and we want to give unfettered and undefined power to the minister? What is next? Are we going to interfere with the General Motors Cami strike going on right now because of concerns of moving the plant to Mexico or the US? Or using these powers to punish Toyota for not putting a plant in a friendly riding? It sounds inconceivable, but we have to stop and look at this through the lens of the Bombardier and Boeing mess, where the government has stepped in and interfered. We have to look at how the Liberal cabinet interfered with the purchase of the Navy's replenishment ship apparently at the orders of a rival firm.

It is important to ensure that motor vehicle inspectors at Transport Canada have the information they need to ensure companies are complying with the Motor Vehicle Safety Act. It is also important that we are not unnecessarily and excessively increasing the discretionary power of the minister at the expense of companies invested in Canada.

In 2015, as has been noted before, five million passenger vehicles were recalled in Canada. Dozens of vehicle types are recalled each year for which Transport Canada has not received any complaints. This means that vehicle companies that already have the incentive to ensure their vehicles are operating safely on our roads to the benefit of consumers are largely fulfilling their role in ensuring vehicle safety. I am therefore left wondering if we are increasing the discretionary power of the minister and the Department of Transport to fix a problem that does not really exist.

The government's argument is that the powers are anticipatory. Unfortunately, it is logically inconsistent to arbitrarily increase the power of a member of the executive unless there is a clear need to do so.

The new ministerial powers would also potentially be self-justifying their actions. The minister would be able to order a company to conduct tests on a product and provide evidence to the minister, which the government could then turn around and use to justify a recall against the same product.

The legislation would also give vehicle inspectors from Transport Canada new powers to enter any private property, other than a home dwelling, examine any documents, disassemble and remove any components, use any computers that would be on the location and copy data, as well as interrogate workers present to ensure compliance with the act. This power is quite exceptional and directly contradicts the very basic privacy protections afforded to individuals and businesses in Canada. Everyone must provide clear and objective standards under which the minister would invest inspectors with such extraordinary powers to prevent said abuses of power.

A reading from the Auditor General's report, and there are a couple of items here, states:

Overall, we found that Transport Canada did not develop motor vehicle safety standards to respond to emerging risks and issues in a timely manner. [We had to] waited for the United States to change its motor vehicle safety standards before modifying Canadian standards....We could not always determine how the Department used evidence and research to develop or amend safety standards. Transport Canada did not plan or fund its research and regulatory activities for the longer term.

Nothing in this act would do anything to address these real concerns addressed in the Auditor General's report.

Earlier, the minister stated that Bill S-2 was well-intentioned. We do need something a bit more than well-intentioned.

The Auditor General provided rather uncomplimentary assessment overall on the state of operations at the Transport Canada motor vehicle safety directorate. His office was especially tough on the processes Transport Canada used to create and enforce new regulations, noting that, “We could not always determine how the Department used evidence and research to develop or amend safety standards.” The AG cannot determine how Transport Canada comes up with safety standards, but the government wants to give Transport Canada full power to order recalls and demand that companies conduct research on safety standards.

It is not clear how Transport Canada would obtain, utilize, and keep the vast new data it would be able to collect, and it is sure unclear whether it would be able to justify the decision to obtain the data in the first place.

The Auditor General criticized Transport Canada's national database for not including complete Canadian data and for not attaining relevant information on industry statistics.

It is troubling that a department criticized for its existing process should be granted new powers without clear mechanisms for oversight to protect the integrity of the process. Perhaps the minister should focus his energies on addressing the Auditor General's report first before moving on with Bill S-2.

I look forward to the minister addressing the processes at Transport Canada and to rectifying the issues noted by the Auditor General. I encourage the government to provide adequate justification to make the case to increase discretionary power.

It is unclear how the government plans on addressing differences in opinion between vehicle manufacturers and Transport Canada. While not opposed, auto and parts manufacturers are concerned about the outcome of a potential difference in opinion about the nature and gravity of a defect between them and Transport Canada.

It is incumbent upon the government, as I mentioned, to ensure that it is creating a system that is open and clear and can be objectively applied in each case, perhaps some system where it could make evidenced-based decisions of some kind.

I am concerned about the lack of detail surrounding the arbitrary increase in the powers accorded to the minister. I am further concerned about the lack of oversight of Transport Canada, which has been criticized by the Auditor General specifically for being opaque regarding its internal processes and decision-making frameworks. I hope we can get the legislation to committee for further study. I trust the committee will take a long, hard look at our concerns as well as the concerns of the Auditor General.

The House resumed consideration of the motion that Bill S-2, An Act to amend the Motor Vehicle Safety Act and to make a consequential amendment to another Act, be read the second time and referred to a committee.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, my question is quite simple. I will repeat it because I have yet to get an answer.

While I acknowledge that Bill S-2 has merit, as I said in my speech, could my colleague tell me what aspects of Bill S-2 fill the gaps that were identified by the Auditor General in his last audit of motor vehicle safety in Canada?

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Mr. Speaker, I have had the opportunity to ask questions of a number of members of the governing party on Bill S-2 and I would ask, if he had to, what he would pick out as the key differences between Bill C-62 and Bill S-2, which he believes make this a better bill.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, it is always a pleasure to rise in the House. I welcome all members back. This is my first opportunity to stand and add some of my thoughts on an important piece of legislation.

To begin, I am reflecting on how very important it is during breaks for members to meet with their constituents to get a better sense of the messages they want us to bring to Ottawa. One thing I respect immensely about the Prime Minister is that he continues to challenge members of Parliament to go into their constituencies and represent their constituents' interests here in Ottawa, as opposed to bringing the interests of Ottawa to their constituencies. We need to ensure our priorities are right, and our priorities are to ensure that constituents in our ridings are represented, whether it is in the chamber, in committees, or in our respective caucuses.

It is a pleasure to be back in Ottawa to deal with important government legislation. All legislation is important, but today is special in the sense that we are talking about Bill S-2, legislation that would make a difference in the safety in our communities. It is very important for all of us to understand and appreciate what sort of impact this bill would have.

One of my colleagues mentioned that it is estimated, and I suspect this is a conservative estimate, that 20% of newer vehicles on the roads today have recalls for some sort of manufacturer defect, and there is a substantial cost to that. In addressing that issue, this legislation carries the ball quite far, I would suggest, and I applaud the minister, the parliamentary secretary, and all of those involved in bringing forward the legislation. I appreciate the fine work that the other chamber has done in providing us with the legislation we are debating today.

After listening to my colleagues across the way, I have a couple of comments. A New Democrat representative referred to the fact that we will be expected to look at different types of legislation and then suggested that Bill S-2 should be relatively uncontroversial. It is a piece of legislation that I believe will ultimately receive the support of all members of the House, at least in advancing it to the standing committee, where there will no doubt be a much more detailed analysis of the legislation. If there are ways it can be improved upon, I am sure the committee will attempt to do so, recognizing that where we can do better, we will strive to do so.

With regard to vehicle safety, we need to recognize that there are two jurisdictions that play a critical role, one being the national government. The bill before us today, Bill S-2, is important legislation dealing with manufacturers. Cars do not last a lifetime. Individuals today have two major expenditures: the homes they live in and the vehicles they acquire. Many vehicles are purchased at face value, meaning that if they are brand new, there are certain expectations for those vehicles. The national government plays a critical role in not only ensuring that vehicles are safe but also, to a certain degree, in providing assurances to consumers. That is done through recalls, ensuring that manufacturers take responsibility for their products.

If I walk into a showroom today and buy a nice, brand new, shiny vehicle, and I pull off, and then a month later there is an issue with an airbag or a steering column, I should have some sense that there is going to be a recourse whereby the manufacturer will have to rectify the problem, because it is not my driving that caused the issue; rather, it was a fault or manufacturing-related issue that caused the problem.

We know that situation exists. As I mentioned earlier, it is estimated that over 20% of all manufactured vehicles will at one point or another have something recalled or something that needs to be tweaked or replaced. It can be fairly substantial. It can be somewhat inconsequential in terms of cost, but important in terms of safety. We know those are the types of things we have to face.

Ottawa, in coming up with legislation such as this, is empowering the minister to do certain things we are not able to do today, and I want to focus some attention on a few of those things. However, to speak more broadly about the industry as a whole, we understand and appreciate how important the automobile industry is to our nation in terms of the overall GDP and the impact it has on real middle-class jobs and on our economy in every region of our country. It is not only the manufacturers; it is also the individuals who service the vehicles and those who sell. Major retailers out there are very dependent on the automobile industry. It is an industry I am quite familiar with. My father or other family members have been involved in it in excess of 40 years.

When the average person purchases a car, even though they might think it is the car for them for the rest of their life, very few will purchase a car that will be their car for the rest of their life. Surveys show that an individual will keep a car for six to eight years. After that, they will sell it, but just because they lost interest or decided to go for a new car does not mean that this car leaves the road. It then becomes a second-hand car, and at this point many provincial jurisdictions recognize that we need to ensure that our roads continue to be safe. In my own province, Manitoba, if someone sells a second-hand car, there is an obligation to have it safety-checked, so that whether it is two years, 10 years, or 11 years old, the vehicle is in fact safe for driving.

As provinces continue to look at ways to improve the condition of those second-hand cars on the road, we also have a responsibility to ensure that the new cars that are being sold are safe. Where we can play a role in ensuring they are safer, we should do just that.

When I look at what the legislation specifically does, there are a few things that come to mind, but one of the things that tweaked my interest was how the manufacturers would be financially responsible for correcting a vehicle defect and also have an enhanced responsibility to provide information related to the safety of the vehicle to Transport Canada. That information would go into the Transport Canada data bank.

One of my colleagues made reference to the data bank. If one goes to the motor vehicle safety recalls on the Transport Canada site, one would be amazed at just how detailed that data bank is. For many people who are driving newer vehicles today, whether one, three, or four years old, there is a very good chance there has been a recall of some part on that vehicle, but drivers are just not aware of it.

It is very simple to find out whether a vehicle has been recalled. People visit the website, virtually click on the type and model and the style of the vehicle. The recalls that have taken place will pop up. It is a fantastic databank. I would suggest to all consumers, people who have purchased cars in the last number of years, not to take it for granted just because their vehicle seems to be driving well. They do not have to wait for something to go wrong. There is a fantastic databank that is there to be utilized. One of the things that this legislation is proposing to do is to enhance that databank by requiring additional safety information to be passed on, some of which no doubt will ultimately end up in some form of the databank. I see that as a very strong positive, and I would encourage others to look into it. The minister would have the power to call for additional testing to address safety concerns. That is something that all of us need to be concerned about.

In listening to a number of the Conservatives, it is interesting to hear that they talked a lot about Bill C-62, which is a piece of legislation that the former prime minister, Stephen Harper, had brought to the floor of the House. This is one of the reasons why I am somewhat optimistic that the Conservatives should be onside and wanting to see this legislation pass sooner as opposed to later. I would suggest that the legislation originates not necessarily from the former Conservative government as much as actions that were being taken in the U.S.A. There is a gap between the U.S.A. and Canada related to safety issues and recall processes and procedures and what that government is able to do in comparison to the Government of Canada. I suspect that what we saw was a Conservative government looking at what was happening in the U.S. and then wanting to adopt some of those measures, and I give the Conservatives credit for doing so.

I know that the NDP expressed some concern that this legislation was not in the mandate letter of the current minister. The only thing that I can say to that issue is that just because it is not within a mandate letter does not necessarily mean that the ministers are not looking at still improving the system. We have ministers who are very keen to look at and administer the mandate letters and achieve things within the mandate letter, but there are many other initiatives, and this is one of those. It would appear that, across the way, both the New Democrats and the Conservatives are in general supporting the principle of the legislation, and we see that as a good thing. We look forward to the opposition parties supporting it.

In the legislation, the minister of transport would have the power to order companies to make manufacturers and importers repair a recalled vehicle at no cost to the consumer. For those who use vehicles and have to get vehicles serviced, there is a substantial cost factor to it. As one would obviously argue, why should a consumer, who purchases a brand new vehicle and three months later finds out that there was a defect, have to be financially responsible for recovering or bringing that vehicle up to Canadian safety standards? Enabling the minister to have that additional power or authority is a very strong message that is being sent to the industry.

I do not think we need to say all manufacturers are not taking up their responsibilities to ensure that their vehicles are safe and at the highest quality. We recognize that manufacturers do whatever they can. We have seen manufacturers institute massive recalls well into the billions of dollars.

We understand and appreciate that this legislation is there, because at times, whether today or in the future, a minister should have the authority to do what is being proposed in the legislation. The bill would allow Transport Canada to use monetary penalties or fines to increase safety compliance and to enter into compliance agreements with manufacturers to take additional actions for safety. The legislation would also increase and clarify Transport Canada's vehicle inspection capabilities. It is important that we have a sense of enforcement that is real and tangible, so that if we have a vehicle that needs to be recalled for whatever reason, we would have the ability to ensure that it would be carried out. This is something we see within the proposed legislation.

I look at the legislation as a whole and recognize that what is being proposed by the Senate amendment is ultimately dealt with in the legislation. With the Senate amendment, a company would be required to compensate a dealer for an amount equivalent to at least 1% per month of the price paid by the dealer. The amount would equal an annual interest rate of at least 12%. This arbitrary rate does not take into account the fluctuations in the real financing costs, and therefore the amendment could have the perverse effect of a dealer potentially making more money by not making the repairs, keeping the vehicle on the lot, and charging the manufacturer. Therefore, when we look at the amendment being proposed by the Senate, as much as the intent might have been very good, I do not believe it is required. Within the legislation, the minister would have the authority to have manufacturer defects dealt with, paid for, and recovered by the manufacturers. The minister would have that authority already.

We have to be very careful that, within the Transport Canada legislative framework, it is not required for us to be arbitrary or work between the dealerships and manufacturers. It is very much a consumer issue. At the end of the day, as much as the intent of the Senate's amendment is meant to do well, I do not believe it is required. The opportunity to see dealerships adequately taken care of through the current proposed legislation is there, and the minister would have that authority.

It is interesting that one of my colleagues made reference to the fact that, when we think of recalls, we have to ensure that the priority of manufacturers is to get the vehicles that are actually on the roads dealt with as a first priority. Those vehicles in the large compounds, which we have all seen, will ultimately be on the road, and I suspect there will be modifications made to them before they are sold to the consumer. The bottom line, once all is said and done, is that the legislation before us is all about increasing the safety on Canadian roads, and therefore ensuring that manufacturers and companies take on their responsibilities by providing the type of vehicles that consumers expect when they purchase them. I think this is legislation that we should all be supporting.

[Kevin Sorenson, Conservative, Battle River—Crowfoot, AB]

Mr. Speaker, I want to thank the member for attending our public accounts committee and for the very good work she did that day with questions to the Auditor General and his department.

There is so much I could say about the Auditor General's office. We know that in a democracy, transparency and accountability are paramount in maintaining a strong democracy and a strong country. Canadian citizens must have confidence that whether they are provincial, territorial, or federal governments, there is someone doing performance audits as well as financial audits and that they are holding departments, ministers, and governments to account.

We can be very proud of the Auditor's General's office and of our Auditor General and his staff. When they come with a decision, we need to accept it. We need to accept the recommendations. We need to accept, generally, certainly on all public accounts, financial audits and performance audits. They hold departments to account.

There is no gray area with vehicle safety. I do not think there will be a lot of differences among political parties on whether we believe there should be standards for vehicle safety. I may be going on a bit of a rabbit trail and a rant here, but I am very concerned about safety on the road. I am concerned about young people texting and being on the phone at times. On occasion, we have talked on the road. We still see people on the road texting, looking down, or being on the phone. I am very concerned when I see it.

I had a call from Mothers Against Drunk Driving this week. They are very concerned about alcoholism and travel on the road. I am very concerned about our movement towards the legalization of marijuana and what that will mean without the ability to do roadside testing yet.

I think Canadians get it. There are very few people who think we should be an open society with no regulation.

Obviously, we want safety on the road. When I go into a dealership to buy a new vehicle, and I see the new technology we have, although I do not understand the electronic components and what the vehicle can do, I expect that it is going to be safe. I expect that it is not going to injure or harm me or anyone else on the road because of that technology.

The Auditor General spoke more specifically to process than to the politics of any of those issues. Again, it is very important work the Auditor General does. I again thank him for that. We can be very pleased that the report came out and that the government has moved with Bill S-2 as part of the answer to the Auditor General's report.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, when we compare Bill C-62, which was introduced by the Conservatives, to the Liberals' Bill S-2, we find many similarities and some differences. We note that the two administrations have something in common: they both decided to cut Transport Canada's budget.

Does my colleague believe that it is possible to reconcile increasing motor vehicle safety with cutting Transport Canada's budget?

[Kevin Sorenson, Conservative, Battle River—Crowfoot, AB]

Mr. Speaker, it is again a privilege to stand in the House after a good summer when Canadians were on the road travelling throughout Canada, appreciating our great country and celebrating Canada's 150th anniversary. It is nice to get back to Parliament and to represent the good folks of Battle River—Crowfoot.

I am pleased to participate in today's debate on Bill S-2, An Act to amend the Motor Vehicle Safety Act. Bill S-2 would give the Minister of Transport new vehicle recall powers. This bill is similar to legislation introduced by the previous Conservative government. Our Conservative Party is also concerned, and as a government was concerned, about passenger vehicle safety. We had legislative amendments in what was then called Bill C-62. It has been referenced today in the House a number of times, and I thank the Minister of Transport for his recognition of that bill as a good measure.

Bill S-2 would give the Minister of Transport the power to order companies to issue a recall notice. It would then compel manufacturers and importers to repair a recalled vehicle at no cost to the consumer. It is obvious that recalls are not only for safety on our roads and for our customers, but also to give Canadians confidence that the manufacturers of the vehicle models they have bought will comply when they realize there are questions about safety. The bill would give the Minister of Transport the power to order manufacturers and importers to repair new vehicles before they are sold. It would allow the Department of Transport to use monetary penalties or fines to increase safety compliance and to use the monetary penalties as a way to require manufacturers to take additional safety action. It would provide the department with flexibility to address ever-evolving vehicle safety technology and require companies to provide additional safety data and conduct additional testing to address safety concerns. Finally, the bill would increase Canada's vehicle inspection capability.

The importation of motor vehicles and motor vehicle equipment into Canada is governed by the safety standards established by the Motor Vehicle Safety Act.

Before vehicles imported to Canada and equipment manufactured in Canada can be shipped to another province for sale, they must have a national safety mark confirming that they have been manufactured according to the act and the existing safety standards that are in place.

Currently under the Motor Vehicle Safety Act, only manufacturers can order the recall of vehicles in Canada. The Minister of Transport can only order a manufacturer to notify Canadians that their vehicle is subject to this safety recall. Bill S-2 proposes to allow Transport Canada to issue monetary penalties against manufacturers. This new power is intended to ensure that manufacturers comply with Canada's Motor Vehicle Safety Act. The monetary penalty system would replace the time-consuming and very costly criminal prosecution of automobile manufacturers.

Bill S-2 would more closely align Canada's automobile recall process with the existing process in the United States. I asked the minister this morning how closely it would align with that in the United States. He was fairly clear that the intent of the measure was to reduce enforcement gaps between Canada and the United States, although I think he also insinuated that there were other safety precautions—I am not so sure if those are in Bill S-2, but in our safety standards—that go further than what the United States may have.

The previous Conservative government had already strengthened the Motor Vehicle Safety Act in 2014. Our previous government also passed into law provisions that brought the Motor Vehicle Safety Act very closely in line with American legislation. We know that we have an integrated industry. We know that there are vehicles manufactured in Canada and then sold in the United States, and vice versa.

It is an integrated market. Therefore, it is very important that we not put up red tape or barriers that limit the industry from having that equivalency between the two countries. For example, we were explicit in differentiating between an automobile defect compared to an automobile's non-compliance with Canada's Motor Vehicle Safety Act.

In 2014, our Conservative government gave Canada's former minister of transport the power to order an automobile company to inform Canadian consumers of safety defects. Bill S-2 is building on that effort by giving Canada's transportation minister the power not only to inform the public but also to recall those vehicles.

Canadians want and expect our vehicles to be safe and want defects to be identified as quickly as possible. The power to order vehicle recalls will help manage vehicle safety in Canada. Everyone knows that technological advances in motor vehicles are evolving so quickly that cars are becoming more and more technical and complex. We see it everywhere, with our cellphones, our videos, and anything dealing with electronics. We see it now in vehicles and vehicle safety. As the technology grows, the question is whether we are keeping up. I will talk a bit about that later on.

For us to be competitive we must facilitate these needs. Canada's regulatory regime needs to be more responsive to new and emerging technologies. We need to be responsive to new fuels as they come online, and also to safety advances. This bill will allow the department to require manufacturers to provide more safety information and do testing when needed, as well as increase their flexibility to address ever-changing safety technology.

Bill S-2 has provisions that did not appear in Bill C-62, tabled by the previous parliament in June 2015. Consent agreements relating to safety improvements and non-compliant companies have been added. As well, the current government wants to impose initiatives to provide some early flexibility to address the challenges of rapidly changing vehicle technologies. This measure needs to be pursued carefully when Bill S-2 is studied in committee.

This is again time to express the important work that committees do. We need to allow our committees the ability to look at these measures, to look at the timeliness of how we can deliver change, of how we can adapt to the ever-changing world of technology, of how that equates back to vehicle safety, and whether all of the possibilities are being checked out.

Also, the current government needs to pursue this measure carefully. The purpose of Bill S-2 is to increase consumer protection and motor vehicle safety in Canada. That is why we moved on this in 2015. It obvious today that the official opposition wants to support Bill S-2 in principle. However, we want this bill to go to committee to have the proper work done there.

We should also recognize and thank the Senate for bringing this forward quickly. Again, I am not certain why the government did not bring this as a government bill, but the Senate did bring it forward with some amendments, which we will talk about later on as well.

I had the privilege of chairing the House of Commons Standing Committee on Public Accounts. I am pleased that the Auditor General's report, as well as the report of the public accounts committee, and the important work they have done, is part of the debate today in the House.

The 2016 fall reports of the Auditor General of Canada included a chapter on oversight of passenger vehicle safety and the performance of Transport Canada. The Auditor General's report, entitled “Oversight of Passenger Vehicle Safety—Transport Canada”, found a couple of things. It states that vehicle safety technology is evolving faster than Canadian regulations and standards can keep up, and that Transport Canada faces challenges in exercising its important role of keeping passenger vehicles safe.

The Auditor General noted a number of significant deficiencies in the regulatory framework, including a lack of timeliness, an absence of broad stakeholder consultation, and outdated regulations. The report states:

For example, Transport Canada’s regulations did not allow vehicles to be equipped with advanced headlights that are controlled by software...[and] unregulated semi-autonomous vehicles are being driven on Canadian roads.

Those are a couple of areas where Transport Canada was not keeping up with what is available out there for the general public in some cases. The report goes on to state:

...Transport Canada waited for the National Highway Traffic Safety Administration in the United States to develop new or amended standards before proposing regulatory actions in Canada.

The Auditor General was concerned about that. However, I am pleased that we recognize the integrated nature of the industry and that we are not always making changes after the United States does. Rather, we are watching what it does so we can have access to its market. The report further states:

This reactive approach created significant delays in implementing new standards, and meant that some passenger vehicles were not equipped with the newest safety features available in other countries, such as the...advanced headlamps.

It continues:

There were lengthy delays—sometimes of more than 10 years—from the time that Transport Canada started to work on an issue to the implementation of new or amended standards.

As has been mentioned, technology is advancing quickly. What is new today in much of our technology will be old news or old technology in six months. Therefore, Transport Canada needs to address ways in which it can keep up.

The report further states:

Prior to making proposed regulations public in the Canada Gazette, Transport Canada consulted with manufacturers but did not engage broadly with stakeholders such as consumer associations, medical associations, and [our] police [forces].

The audit found that the important standards were not working as intended or were outdated.

Furthermore, the Auditor General stated:

...Transport Canada was aware that child seat anchorages could fail under certain conditions, but it had not proposed a new regulation or issued an advisory by the audit completion date.

The response by Transport Canada to the Auditor General was that introducing a unique-to-Canada requirement for anchorage strength in passenger vehicles would be detrimental to trade, and for that reason there was a delay.

Most concerning, and a challenge for the current Liberal government, is that Transport Canada has not been focusing on planning or funding its research and regulatory activities for the longer term. The department could not prioritize resources and spending decisions. It sounds like there are some real administrative problems there. For example, between April 2012 and December 2015, the department purchased 98 passenger vehicles for research testing. However, as of December 2015, a number of them had still not been tested. The vehicles were sitting there but many of the tests had not taken place.

The department appears to adequately assess complaints by Canadians and identifies vehicle safety defects. However, the report states:

...the Department did not request information about critical safety issues that manufacturers were investigating. As well, manufacturers issued 318 recalls between 2010 and 2015 for safety-related issues that were not brought to the Department’s attention.

Therefore, we can see the communication, the passing of information, and the data that is there. Data in just about everything in government is problematic. Here was a case of the department not working closely enough with the industry for it to be aware of recalls implemented by manufacturers on their own.

The report continues:

Furthermore, the Department did not have the authority to assess whether manufacturers implemented effective processes for identifying and reporting safety defects. This limited the Department’s ability to investigate defects and better protect Canadians.

While Transport Canada adequately assessed vehicle manufacturers' efforts to complete safety recalls, it was left to the manufacturers to contact owners for some recalled passenger vehicles. Manufacturers had difficulty identifying and contacting owners, especially owners of older vehicles. We know that sometimes other related or unrelated issues in an older vehicle may compound the problem it is actually being recalled for. We almost have a double whammy with these old clunkers on the road, as another politician in the past said, so we need to be certain that we comply with this.

The good news is that Transport Canada has agreed with the seven recommendations made by the Auditor General and is pursuing a detailed action plan. Again, I am pleased to report that the public accounts committee has studied and reported on this. We are still involved in a follow-up process that will hold them to account and make Canadians feel even safer.

I am going to read some of the recommendations the Auditor General had. Recommendation 1:

Transport Canada needs to confirm in writing to the Committee that it provides regular public updates on the status of its regulatory plans.

The public needs to have confidence.

Recommendation 2:

Transport Canada needs to provide the Committee with a report detailing the implementation of an expanded and standardized consultation process seeking comments in a timely manner from expert stakeholders on Motor Vehicle Safety’s regulatory initiatives.

Again, this goes back to stakeholders, including the industry and our emergency responders, police forces, and other stakeholders.

Recommendation 3:

Transport Canada needs to provide the Committee with a report detailing how it has implemented its action plan to improve the quality of collision and injury data.

Again, that is part of the process of follow up that committees do.

Recommendation 4:

Transport Canada needs to provide the Committee with a report detailing the progress of the updated regulatory process and how evidence and scientific research are used to inform the development and/or modification of Motor Vehicle Safety Standards.

How is science and research helping?

Recommendation 5:

Transport Canada needs to provide the Committee with a report outlining its long-term operational plan for the Motor Vehicle Safety Directorate.

Recommendation 6:

Transport Canada needs to provide the Committee with a plan detailing how Bill S-2’s proposed new authorities will be implemented into the passenger vehicle safety regulatory regime.

Finally, Recommendation 7:

Transport Canada needs to provide the Committee with a report outlining its process to support a new authority in the Motor Vehicle Safety Act to request that major auto manufacturers provide information on their data sources and internal processes for identifying and reporting safety defects.

Those were the Auditor General's recommendations in the audit, but one of the things he concluded with was this:

Transport Canada did not maintain an up-to-date regulatory framework that responded to emerging safety risks and technological issues. As a result, the approach failed to ensure that Canadian-driven passenger vehicles had the highest possible safety features and technologies.

I see that I only have one minute left. I will quickly say that I believe that there are laudable measures being taken in Bill S-2 that should be supported. The current government faces some formidable challenges in addressing vehicle safety in Canada, but I think this is a step in the right direction. As he stated, it is adopting the Conservative bill, Bill C-62, and we commend him for that.

Beyond that, as always, the devil is in the details. Again, we will be watching to see how quickly this is implemented and how quickly a minister would actually step out and tell manufacturers that there should be a recall. It needs to be not only passed but complied with by a minister who is prepared to make those tough decisions.

There are numerous challenges in keeping Canadians safe in the vehicles on our roads. Our former government was aware of that, and that is why we acted in 2014 and again in 2015 with the tabling of Bill C-62.

I commend the Liberal government for moving on this issue as well for adopting a bill that, unfortunately, had to start in the Senate. I hope that the government will allow the committee to do its work and that we will see this legislation move through the committee in a timely fashion.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, this is the first chance I have had in the debate to say I do favour Bill S-2 and will vote for it. However, I wonder if the member could shed any light on why the bill began in the Senate. I think we all agree it is important for the minister to have powers to take vehicles off the road, not merely negotiate with the automakers. It seems overdue. I wonder if he could shed any light on that. It certainly is not germane, except that it always is a matter of parliamentary procedure. It strikes me as odd.

[Sean Fraser, Liberal, Central Nova, NS]

Mr. Speaker, I have had the opportunity to work the member opposite as well on the same committee I referenced previously.

Simple questions are best, although without having the Auditor General's report in front of me at the moment, it does make it a bit more difficult to answer in detail.

Bill S-2 is probably not going to create every possible safety measure when it comes to preventing defects from getting on to our roadways, but it is going to make Canadian society and our roadways safer as a result.

I look forward to working with the member on our committee, presuming the bill gets through the legislative process in the House in one form or another, so we can dig in and examine the Auditor General's recommendations, if he wishes, alongside the measures that are explicitly contained in the bill and make this the best possible legal outcome that protects lives of Canadians on our roads.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I would like to ask my colleague a very simple question about something I was trying to ascertain earlier.

According to my honourable colleague, does Bill S-2 address the gaps identified by the Auditor General in his last audit? If not, should we do so indirectly given the inconsistency between the intent of the legislation, the resources, and the funding?

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Mr. Speaker, I always appreciate the member's very thoughtful interventions not only in this place but at committee. I would like to pose a similar question to him that I posed to both the minister and the parliamentary secretary.

Perhaps I could be accused of asking fairly technical questions, but this is a technical bill. I am focusing on some of the changes that we should be very familiar with between Bill C-62 and Bill S-2, because there are not very many, except for the amendment that has been spoken to quite a bit during the debate so far.

I will get more specific about the measures in proposed section 16, on which I have asked for some clarification. Proposed section 16.24 establishes that following the issuing and service of a notice of violation, the minister can make the nature of the violation and other related details public. What is the purpose of that measure and why it has it been included? This is to frame it for me going forward in this debate.

[Sean Fraser, Liberal, Central Nova, NS]

Mr. Speaker, it is my pleasure to rise to offer a few remarks on Bill S-2, an act to amend the Motor Vehicle Safety Act.

Before I begin, I was under the impression I would have 20 minutes, so I will give the Coles Notes version of a longer speech.

Before I get too deep into the weeds on this one, I will explain in broad strokes what the bill is about.

Currently, motor vehicle safety is a priority, and I think that is shared by every member in the House. When we look at the impact motor vehicle defects can have, there is a paucity of laws that allow the government to take action to correct a very serious problem. Over the course of my remarks, I hope to outline roughly the scope of this problem, that it is a priority, and then address three key points built into the legislative mechanisms that would help improve the government's ability deal with this problem, specifically dealing with the power to order recalls, compliance mechanisms, and, finally, the flexibility to deal with emerging technologies.

First and foremost, if I am to argue that this is a problem in Canada, I need to look no further than some of the very positive news coverage from last year that highlighted the impact that manufacturers' defects had on vehicles on the roads in Canada today. If I am to believe the content of a Globe and Mail article from December of last year, one in six Canadian vehicles is currently subject to a manufacturer's recall in Canada. That means millions of vehicles on are on the roads today that manufacturers have acknowledged are not safe enough to meet Canadian standards. I urge anyone watching, and I know that on CPAC during House proceedings there is a massive audience, to visit Transport Canada's website, use the searchable database, and determine whether their vehicles are subject to existing manufacturers' recalls about which they may not know. These things can fly under the radar when Canadians have other priorities and things to worry about in their lives. However, they are important and pose safety risks.

We can safely assume that manufacturers' defects are a safety concern in Canada today. The legislation proposes a number of things to deal with them.

Let me first deal with the power of the minister to order a recall when becoming aware of defects, which is a power provided for in Bill S-2. There are really two categories in which the minister would be empowered. One deals with consumers and the other with dealers, though perhaps I am simplifying it a little too much.

On the consumer side of the equation, right now the minister does not have the same power that exists elsewhere in the world, including the U.S., to order a recall. Importantly, the remedy would exist where consumers would not have to cover the costs of having their vehicles repaired or replaced. This is a burden that can and should be borne by the manufacturer responsible for the defect. This would enhance safety by allowing more consumers to have their vehicles fixed at no cost.

The second side of this equation has to do with dealers, and I will spend a little more time on this.

Right now in Canada, there is no law that says a dealer cannot sell a car with a defect. In fact, not enough information flows for dealers to know when defects may exist to ensure vehicles do not make it onto the roads. If I am dealing with a leaky roof at my house, the first thing I will do is find a bucket to stop the water from damaging my floor. The second thing I will do is try to fix the pipe causing the leak. If we are only dealing with the consumer side of the equation, we are going to maybe prevent more drops from hitting the floor, but we will have to keep replacing the bucket if we do not do something to prevent the sale of defective vehicles getting onto the roads in the first place.

This puts dealers in an admittedly difficult position. This could put dealers in a position where they are going to be left carrying inventory on their lots that they cannot sell, and that is not right. I want to draw attention to a discussion the upper chamber had on the issue and proposed amendments specifically on Bill S-2.

Before I do that, I want to extend my gratitude to our colleagues in the other chamber for their thoughtful deliberations on this legislation, and many others, and for drawing attention to an important issue that has caused me to think very deeply about this. However, I must respectfully disagree that the suggested amendment is the appropriate mechanism to correct the social harm we all want to fight.

The mechanism proposed in the amendment seeks to address compensation for dealers that are left with inventory on their lots that they cannot sell. The amendment proposes a 1% interest rate on vehicles, based on the price of vehicles, per month. If I do the math in my head, this becomes very expensive for manufacturers and does compensate dealers somewhat.

When I was trying to understand whether this was the right policy, I had to think back to some of my work before where I had the opportunity to work in a litigation practice with a bit of a constitutional influence and back to law school and what we have the authority to do in this chamber.

My first obstacle, and reason why I cannot bring myself to support the amendment, is a constitutional issue. I do not know that we have the constitutional authority to legislate the terms of a commercial arrangement between contracting parties at the federal level. Sections 91 and 92 of the Constitution say what the federal government and provinces can do respectively and there is no question we can tackle issues that touch on public safety. However, when it comes to the contracting arrangements between commercial parties, this is exclusively within the purview of the provinces. In fact, there is a lot of sale of goods legislation in place in provinces specifically to deal with these issues. I cannot overcome this barrier and I cannot in good conscience support an amendment that I do not believe we have the authority to pass and adopt in the House.

The second and more practical stumbling point for me on the proposed amendment is the possibility we could be creating an unintended consequence that I do not believe our colleagues in the upper chamber had specifically drawn their attention to, again, with great respect and deference.

What we might be doing is creating an economic incentive for manufacturers to fix cars that are in dealers' lots today before they fix cars that are on the roads. If we assume. just to make the math easy, there is a recall that applies to 100,000 vehicles at a price of $25,000, we are looking at interest payments on the part of the manufacturer to dealers in the realm of $25 million a month. This is a great motivator for companies. If they are looking at a severe penalty like this, they are going to change their behaviour, and this might inspire them to fix cars sitting on dealers' lots more effectively. However, I do not want them to do that at the cost of cars travelling on Canadian roads today. Creating this incentive to deal with cars that have not yet been sold over cars that are owned by Canadians could pose a public safety hazard.

Finally, there are remedies available today for dealers. Bill S-2 puts dealers on the same footing that consumers are on. They will have access to have their vehicles repaired at no cost like consumers will. They will also have the protection of any negotiated provisions in a commercial contract that allocates risk as between the parties and they will have the protection outlined in provincial sale of goods legislation that deals with merchantable quality and fitness purpose for any goods that are sold in our provinces. Respectfully, for those reasons, I cannot support the Senate amendment, but I do believe the legislation is sound.

Very quickly in the remaining minutes that I have, the compliance regime put in place is going to replace one that more or less does not exist today. Today, if we want to enforce violations of the Motor Vehicle Safety Act when it comes to defects, there is an expensive and lengthy criminal prosecution, and many of the violations do not warrant a criminal prosecution. We are implementing a monetary administrative penalty regime that is going to be more like a speeding ticket. It is going to punish those wrongdoers and encourage them to change their behaviour, but often to the tune of thousands or hundreds of thousands of dollars per vehicle per day.

Though I do not have time to cover it, knowing we are on the precipice of emerging technologies in the motor vehicle sector, we want to ensure we do not stifle innovation, particularly when it comes to driverless vehicles. There has not been a disruptive technology in the motor vehicle industry in over a century. Knowing we are about to embrace this change, we need to ensure there is flexibility that allows the minister to encourage innovation in this exciting industry, without compromising our safety.

With these features in mind, I am very proud to support Bill S-2 because it will improve safety on Canadian roadways, with the caveat that I mentioned at length about the proposed amendment in the legislation.

[Karen McCrimmon, Liberal, Kanata—Carleton, ON]

Mr. Speaker, the member is right to point out that Bill S-2 does build upon Bill C-62. It actually goes further by adding extra mechanisms for the minister to use, and one of those is this consent agreement, which would allow him to negotiate and mediate long-term solutions. Right now, the minister does not have the power to compel any manufacturer or dealer to address issues. This is why there is a need for this bill and why there needs to be a little flexibility in how we address these issues.

It all comes back to the same issue over and over again. It is about what we need to do to protect consumers. We need to be able to do this proactively instead of always being reactive. We need to be part of the solution and negotiate or mediate a solution for Canadians.