Industry Committee on Dec. 12th, 2006

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

I was speaking on my amendment. I can continue with my remarks, and I will respond while I'm making my comments.

[The Chair, Conservative, James Rajotte]

Monsieur Crête, you've been asked if you will allow the witnesses to leave.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

I think we might need the witnesses because we are studying two amendments to a motion. Later on, we will see what happens with the motion. I cannot assume that I am going to win or lose the vote, but if I should lose the vote on the motion, I have four amendments to put forward to the bill. When we are studying amendments, clearly we need to have expert witnesses here so that I can rely on their expertise regarding the interpretation of my amendment if I should require it. Personally, I think their presence here is essential. Since they have been here, we have found out that Quebec did not grant its approval, that the situation was very different in the various provinces and that Quebec has a maximum interest rate of 35%. Our witnesses provided us with all this information. They even told us about the situation in the U.S., and it would be a good idea for us to examine this matter in depth.

Mr. Clarke told us that in the United States this is a matter that comes under state jurisdiction, just as consumer protection comes under provincial jurisdiction in Canada. Mr. Clarke did not tell us whether American states have to get the federal government's blessing on this—perhaps we can find out from him during the debate—or whether they can simply forward the information to the federal government. Information about how the American system works might be helpful in what we are doing here, even though we do not intend to copy it in all its details. I think it is important to have witnesses here.

In the amendment, I left in the words “generally supported by the provinces” and I added “with the exception of Quebec”, because I had the clear impression that—

[The Chair, Conservative, James Rajotte]

Mr. Crête, Mr. Carrie has a point of order.

[Colin Carrie, Conservative, Oshawa, ON]

Thank you very much, Mr. Chair.

I'd like to ask the honourable member--he does have an amendment, and I'm willing to vote on it. I think everybody would like to vote on it.

It's clear that the witnesses are here right now, and if you have some questions for the witnesses, it would be reasonable to ask them. This is being very unreasonable to these witnesses, who have come forward to give us the information as well as they can. If you do have some questions for the witnesses, I'd say to be reasonable, ask your questions of the witnesses so we can get the information we need, and we can move forward by voting on your amendment.

[The Chair, Conservative, James Rajotte]

Mr. Crête, are you speaking on this point of order?

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Yes. I did not move a motion, it was the member in question who did so. All I did was move an amendment to his motion. We are debating the amendment, but ultimately, we will be debating his motion. I did not stop to allow committee members to ask our witnesses questions, he is the one who interrupted our questioning. Once we have finished debating the motion, we will see what happens. During that time, I cannot run the risk of sending the witnesses away, in case I win the debate and get a majority to vote in favour of the amendment I have put forward or for any other motion that might be acceptable. We should not be wasting our time and we should be able to ask the witnesses questions. I repeat that I do not necessarily have any questions to ask them about the motion, but I will have questions for them later on, once we begin studying possible amendments to the bill. There are four amendments which I submitted to the committee some time ago. I would like to continue the debate and defend my position on this matter.

[The Chair, Conservative, James Rajotte]

Mr. Crête, I just want to point out to committee members something about points of order.

A point of order is to point out a deviation from the rules or practices; what we've been having is matters of debate. That's what points of order are, technically. Also, you cannot move a motion on a point of order. That's just a clarification for the sake of the rules and for members' edification.

We return now to Mr. Crête and to debating his amendment on the motion.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Thank you, Mr. Chairman. I will explain my amendment again and provide a context.

At line 5 in Mr. Carrie's motion, it says:

Bill C-26 is generally supported by the provinces because it allows them the option to regulate payday lenders through an exemption from section 347 of the Criminal Code to those who have measures in place to protect borrowers.

This bill should not apply to Quebec, because the option offered does not respect Quebec's right to look after its own consumers' rights. It imposes conditions which create a framework and an evaluation by the federal government in an area where this has not always been and still is not necessary. It would be different if the bill were written in such a way that Quebec could simply inform the federal government that it had its own legislation, and this is something which any other province could do as well. If the other provinces truly prefer to send all of their bills to the federal government to ask whether they are in accordance with section 347, I would be willing to accept this type of asymmetric federalism. I do not object to the provinces needing some kind of authorization from the federal government, but I do not want Quebec to have to play along.

I am trying to remember when the Office de la protection du consommateur was created. I remember back when Ms. Payette prohibited advertising aimed at children. The Office de la protection du consommateur was probably created by a Liberal government in Quebec, either that of Jean Lesage or Robert Bourassa. I apologize for not knowing my history well enough to pinpoint the exact date. But, in any case, these were very dynamic and progressive measures, as were the ones taken to create day care services, which were much more progressive than anything else available in the rest of the country.

I think that someone—Mr. Bartlett or Ms. Jenkin—said that this practice was developed in the United States in the 1990s. But in Quebec, we had measures in place well before then, which points to the difference between the two approaches.

This bill is trying to make legal something which is already happening because several provinces have realized that it was going too far and some of the things that were happening were illegal and spinning out of control. In Quebec, the problem was tackled and the situation was regulated. Our maximum rate is 35%. Today, we are being told that we need authorization from the federal government to do this. That's why I have a huge problem supporting the motion as it stands, and all the more so because the motion implies that we are ready to put it to a vote. However, we have not heard from a single province or any other witness, apart from officials, and we have not even heard the witnesses answer members' questions.

If we allow Mr. Vincent to ask questions of the witnesses, we might take a break from debating the motion, as I am sure that there will be additional questions.

It is very important to respect provincial jurisdictions. I read the letter from the Consumers Council of Canada. They don't share my point of view, but ask why it is so important to adopt this amendment to the Criminal Code as quickly as is happening right now. The council says that it would result in each province having its own system. I have nothing against each province having its own system, but I think we need to take much more time before adopting this bill. I don't think it is necessary to settle the matter before Christmas or New Year's. We really need to have a more in-depth debate.

I would really like the committee to ask the Government of Quebec for its official position on this matter. If the committee agreed to write to the person responsible within the Government of Quebec or to the intergovernmental affairs minister to find out what the position of Quebec is, and if ultimately the Government of Quebec said that it did not object to the bill and that it could live with it, then we would see what our position is. I think that would be more reasonable than bulldozing the bill through.

You know, there are differences between bills. When you debate a matter for 14, 25, 38 or 75 hours, when 250 amendments have been presented and they have all been debated, it is possible that people are only talking to kill time.

Personally, this is the first time I debate this bill. This is just the first hour of debate in committee. And if memory serves me well, this bill was sent to the committee by the House of Commons to be studied, so that we could look at the issue in depth.

Therefore, we must deal with two issues. First, the respect of provincial jurisdictions, which, ultimately, is important; but it is just the framework. Second, will this framework work well?

Imagine the following situation: after a bill becomes law, a citizen or group of companies in Quebec writes to Prime Minister Harper to ask him to amend existing legislation in Quebec because this group has not managed to convince the government of Quebec to change it. In other words, these people would turn to the federal Prime Minister to revoke the designation contained in the document. Just imagine the can of worms if we so much as open the door to that possibility! In my opinion, this would not be satisfactory.

However, if the bill included wording indicating that the existing legislation in Quebec would simply be tabled, that Quebec already has legislation to that effect, we will not be opening a can of worms. When Mr. Harper receives the letter from Quebec, he would say that the matter does not fall under federal jurisdiction, that he realizes that Quebec already has legislation, and that Quebec should settle the matter itself. In my opinion, this would respect the true spirit of federalism as far as this issue is concerned.

But as it is worded, we would potentially be opening the door to federal members of Parliament being pressured to get Quebec to change its legislation. I think this is rather unhealthy in view of what is already happening in this sector. So my amendment would be made to that sentence.

The next sentence reads:

I move that the committee is ready to continue through the clause-by-clause review of Bill C-26, with the objective of completing our review, and sending the bill back to the House of Commons today.

It appears that my first amendment—except for Quebec—makes the second sentence redundant. Indeed, how can the committee decide today that it has already settled the matter, when in fact we have not even analyzed it? I have not heard the opinion of a single member present here about this issue, nor whether any member thinks it makes any sense or whether the government of Quebec is sufficiently protected in this area.

Mr. McTeague seems to want to give his opinion by saying he is ready to vote, but that is not how I feel.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

It's to protect consumers, Mr. Crête.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Yes, I agree with you on that point. Indeed, as far as protecting consumers is concerned... Let's talk about consumer protection. For about 40 years now, Quebec has had a consumer protection act. The legislation has passed the test of several different generations and has ignited a great deal of social debate. In that regard, we find we have enough maturity to decide how to tackle the issue.

Cultural practices can vary from one province to the next. For example, I'm thinking of a province which was initially founded by people from certain communities, and for whom money and credit were very important things: Nova Scotia. In fact, the Scots were largely responsible for creating the Canadian banking system. So Nova Scotia might have an approach which is different from that of British Columbia. It depends on the people who settled each of these territories.

Different types of influences took hold in different places. For example, the Mouvement Desjardins—the Desjardins credit unions—is currently working on a microcredit project somewhere in Africa; this project was promoted by a man from Bangladesh who has just won the Nobel Peace Price. The rate of 35% which was established in Quebec was greatly inspired by the Mouvement Desjardins, which initially was created to get rid of loan sharking. When Mr. Desjardins created the Mouvement Desjardins, he wanted to put the village loan shark out of business. He wanted to find another way to fill the void. So he created the Mouvement Desjardins, which gave people the opportunity to put their money in the bank, to earn a bit of interest and to have access to a regular account.

Following this movement, the Quebec government decided to create a law based on existing legislation and determined that for this kind of transaction, the maximum rate was 35%.

This law existed even before the new trend spread across North America and before this bill proposed such a practice. As opposed to the Quebec legislation, the lenders are more interested in this bill than the borrowers are. In Quebec, the people at the grassroots wanted to have a standard practice like the one developed by the Desjardins Group, to ensure that no one got caught in an unlivable situation because of these things. This is how the Consumer Protection Act was created.

As I understand it, the federal government is proposing a bill that is mainly supported by companies that provide loans of this kind, because they want to have a legal framework for their operations. They have every right to want it. They could also want a standard framework for the entire country, as they could want this framework to develop differently in each province. That is the situation.

I think that this is what really justifies the amendment. It would be improper to adopt this kind of legislation if it obliged Quebec to ask for the federal government's authorization.

Let me tell you in detail what I would propose if the amendments were adopted. After studying this bill, we put forward four amendments. The first intends to clarify the definition of payday lending and does not necessarily raise the jurisdictional issue, although it would create different systems based on the size of the loans, and this would have quite a negative impact. The other three amendments all have the same objective, which is to get rid of the veto rights that the federal government is claiming for itself in a field that is not under its jurisdiction, namely, consumer protection.

In the current draft legislation, not only does the federal government oblige the province that wants to legislate payday lending to implement a licence system, but it also allows Ottawa to impose its own view regarding consumer protection legislation. This is a roundabout way of doing something that cannot be done directly. They want to extend their influence...

Earlier, I gave the example of someone from Quebec who could ask the federal Prime Minister to change the Quebec legislation. In addition, there could be people in other provinces of Canada who have developed their industry and who could write to the Prime Minister of Canada to say that they want to enter the Quebec market, but that in order to allow them to do so, the legislation in Quebec would have to be the same as in the rest of Canada.

In this sense, they would be putting pressure on an authority that should not be put under such pressure. These people have the right to want to influence Quebec legislators so that they amend the Consumer Protection Act, but as a legislator in the federal government, I do not want to allow this kind of pressure to be put on the federal government rather than on the Quebec government.

One of our amendments, number 2524665, specifically deals with the licence issue and is more flexible because it allows each province to choose its standards for approving payday lending businesses. Thus, rather than impose a licensing system, our version allows each province to approve payday lending businesses in the way that works best for it.

Another amendment, number 2524712, seeks to repeal a condition belatedly imposed by the federal government. On the one hand, the federal government has no jurisdiction over consumer protection and it has no right to impose its will through reviewing the legislation of Quebec and other provinces.

Another amendment, number 2524742, has a similar objective. It seeks to prevent the federal government from exercising a veto right over the legislation of Quebec and of the provinces, and from arbitrarily taking away their power to legislate the payday lending industry. The Quebec government takes its responsibilities seriously. It was elected by the people, it has a mandate from the people, it is serious about protecting its citizens and it has every right to take every measure it deems necessary to regulate the industry.

The last part of subsection 4 deals with a veto right over the legality of protection measures taken by Quebec and by the provinces.

As far as we are concerned, the federal government has neither the expertise nor the jurisdiction to decide whether consumers are adequately protected by consumer protection laws. It is up to Quebec and the provinces to choose their consumer protection methods.

For all these reasons, I think that I have put forward a useful amendment that should be adopted by this committee. If other members want to intervene regarding this issue, they can do so right now.

[The Chair, Conservative, James Rajotte]

Mr. Crête, do you see a time when you will finish discussion of your amendment?

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

I can surely cover the arguments proposed around this table and finish my presentation on this amendment within 15 minutes.

[The Chair, Conservative, James Rajotte]

Mr. Carrie, do you have a point of order?

[Colin Carrie, Conservative, Oshawa, ON]

Yes. When the honourable member started, he said he wanted to point out the merits of his amendment. I think he has done a good job of explaining it to the three parties here, and we understand the merits.

Mr. Chair, I know I'm putting you in a difficult situation, but if you'd like some guidance from the other members, I think the majority of the members understand the merits of his amendment and where he's coming from. He's being very repetitive, and we could put the question to a vote.

[The Chair, Conservative, James Rajotte]

Mr. Crête, on the same point of order.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

I would like to understand how this is a point of order. He asked the chair if it is possible to end this debate. He also asked me whether I have finished presenting my amendment. This does not seem to be a point of order as such. Nevertheless, I can tell him that once he has finished with his arguments, I could perhaps conclude my presentation about this amendment within a few minutes. However, if other members want to speak out, it is obviously not up to me to decide who has the floor: it is up to the chair. I am ready to continue the presentation of my arguments regarding the amendment, if we are through with the point of order.

[The Chair, Conservative, James Rajotte]

I think what Mr. Carrier was raising in his point of order, Mr. Crête, is that you were being repetitive and that some of your comments were not relevant to the amendment you are putting forward.

[An hon. member]

[Inaudible--Editor]

[The Chair, Conservative, James Rajotte]

One person at a time. When I recognize someone, that is when they may speak. We should keep some order.

With respect to relevance and repetition, I'm advised that as chair I'm supposed to allow the broadest range. I think you've stated your point very well, Mr. Crête, so I encourage you to wrap up your argument. If we can move to the question on the first amendment, I would certainly appreciate that.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

All right. Let me conclude by simply saying that within the general framework of this proposal, I think that it would be appropriate to state very clearly that Quebec does not support this draft legislation. This is the point I wanted to make during my allotted time, that I am using to put forward my arguments on this file and convince my colleagues. In that sense, I am ready to let other concerned members speak out about this issue, if they wish to do so.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Crête.

Do we have any others who want to speak to that?

Monsieur Vincent, you have the floor on the amendment, with the exception of Quebec.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Mr. Chair, excuse me, I think the rules will demonstrate—

[The Chair, Conservative, James Rajotte]

Is this is a point of order, Mr. McTeague?

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Yes. I have two points. I think the right is given to any other party to speak before another member of the same party.

I'm wondering if you would receive the advice that the motion before you presented by Mr. Carrie is indeed out of order. The motion itself is argumentative. It's a substantive motion that deals with argument and therefore is not receivable. Further to that ruling, I propose that we move immediately to clause-by-clause of the bill. That is my counter-proposal, if you deem that this is ruled as argumentative.

If you seek it, you will probably determine that the substance of what is put forward by Mr. Carrie's motion is indeed argumentative, and the simple motion is to proceed to clause-by-clause.