Evidence of meeting #42 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was social.
A recording is available from Parliament.
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Liberal
The Vice-Chair Liberal Massimo Pacetti
Thank you.
Thank you, Mr. Kramp.
Monsieur Mulcair, sept minutes.
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NDP
Thomas Mulcair NDP Outremont, QC
Thank you, Mr. Chair.
I too would like to welcome everyone here. Since our time is relatively limited, I will get straight to it.
First of all, I want to thank Mr. Blakely for his presentation. His assessment is correct, particularly as regards the restrictions with dealing with the black market. Recently, France adopted a similar approach, namely refunding the VAT. These tax measures can stem a problem which has become endemic in this sector.
Mr. Pellerin and I have often had the opportunity to discuss the following issue. Stringent enforcement of laws is fair because most people are law abiding. People who are not law abiding should not reap any economic advantage.
It is always a pleasure to see you, Mr. Pellerin. Thank you for your comments, particularly those concerning the need for Canada to invest as much as its partners in an area in which you are not only an expert, but seen as a valued figurehead not only by Quebeckers but also by all Canadians. It is a pleasure to see you again today. Thank you also for your comments about Quest.
I have a brief question now for Mr. Ogilvie.
What form did the endorsement take that you say you got at the Council of Energy Ministers ?
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Former Executive Director, Pollution Probe, Quality Urban Energy Systems of Tomorrow
Yes, I was at the ministers meeting in Newfoundland, and--
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NDP
Thomas Mulcair NDP Outremont, QC
It's a very specific question. I have very little time. What form did the endorsement take?
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Former Executive Director, Pollution Probe, Quality Urban Energy Systems of Tomorrow
It was a press release that basically endorses a community energy solutions road map.
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Former Executive Director, Pollution Probe, Quality Urban Energy Systems of Tomorrow
It does endorse. There is a press release. I have a copy here.
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Former Executive Director, Pollution Probe, Quality Urban Energy Systems of Tomorrow
No. There is a road map, and it's really for each jurisdiction to figure out how to proceed.
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NDP
Thomas Mulcair NDP Outremont, QC
Okay. Because it can vary a great deal from one to the next. Maybe you could share that with us. Thank you very much.
I'll go to Mr. Clayton.
Recently, we met at my riding office. You told me that although you had only recently arrived from the United States, you planned to learn French one day. We will nevertheless continue in English, so that you can understand more easily.
What I retained from our discussion at the riding office was that a lot of the things that have happened in the past few years with Imperial Tobacco you were unaware of, or you were saying to me that that was in the past. So I'll take you on the list that you gave us today.
One of the great concerns you have is the access to tobacco products by children. I asked you then and you seemed unaware, but have you had time to verify what I explained to you and was actually quite easy to obtain, which was Purdy Crawford's notes for his intervention before his parent company in London, England, wherein he explained the well-thought-out and applied strategy of Imperial Tobacco to get children hooked on tobacco products? Have you now had the time to look at that?
9:50 a.m.
Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
With regard to your first point, I've been taking French lessons twice a week and unfortunately am not making much progress.
To the second point--and I appreciate the suggestion--I did follow up with that correspondence. I am, I suppose, as--
9:55 a.m.
Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
--outraged. Let's also point out that it's a letter from many years ago--
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NDP
Thomas Mulcair NDP Outremont, QC
But we do agree, then, that the people whose tobacco you're fighting to keep taxed by telling the government that we haven't done our job.... There are a lot of people who were hooked because your company had an active policy of getting young people hooked on tobacco products. We agree on that.
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
I was not working at the company at that time. For me to say--
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NDP
Thomas Mulcair NDP Outremont, QC
I didn't ask if you were. I just wanted you to confirm what you've had time to check: that Imperial Tobacco put in place a well-thought-out scheme to get children hooked on tobacco.
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
Sir, Mr. Crawford's letter speaks from Mr. Crawford's point of view. I'm representing my company today.
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NDP
Thomas Mulcair NDP Outremont, QC
Okay.
Now, on the smuggling level, Imperial Tobacco and Rothmans paid a total of $1.1 billion in fines for having put in place an elaborate smuggling scheme. Your share of the fine, unless I'm mistaken, was $600 million. How many of those smugglers went to jail?
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
I don't believe anyone went to jail as a result of the settlement.
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NDP
Thomas Mulcair NDP Outremont, QC
That's right, because there is somehow a difference between criminals, right? Because when you're a criminal with a $1,200 suit and you put the deal together.... They later boasted at Imperial Tobacco that the $600 million fine represented the profits from a single year of smuggling organized by Imperial Tobacco. So not only were the networks, which you're describing now as the big problem, created by Imperial Tobacco, but the very individuals who are still members of those smuggling networks were the ones put in place by your company. You've had time to check that too, I hope, Mr. Clayton.
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
I share your outrage at the state of contraband tobacco today. What is hard for me to understand is why government today fails to recognize that this is a problem and fails to propose a solution. We are happy to work with governments to try to address this problem, for precisely the reasons that I laid out today.
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NDP
Thomas Mulcair NDP Outremont, QC
You're completely right on one point. Tobacco is a legal product. It's legal to sell tobacco in Canada. It is also a legal requirement to pay the appropriate taxes on that product. There are rules. What I find outrageous is that somehow there is this blank slate approach, as if--
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
Sir, I'm not--
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NDP
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Vice-President, Corporate Affairs, Imperial Tobacco Canada Limited
Sir, there is no denial coming from me. I am not denying the settlement that we reached with the federal government. I'm not denying the activities that happened in the past when I was not at that company. What I am saying today is that the illegal market in this country is 33%, and 48% of all cigarettes sold in Ontario are illegal, as are 40% in Quebec.
I guess what I would ask is if we could take your sense of outrage, which I share, and apply it to the situation we have today.