Industry Committee on Feb. 27th, 2007

[Brian Masse, NDP, Windsor West, ON]

That's an excellent point, and that's the other problem we face, that as part of the review, an addendum was added by the panel to the decisions without the request of the minister.

Congratulations on your work in penetrating the market.

Thank you, Mr. Chair.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Masse.

We want to thank you, Mr. Meldrum, for being with us here today. We appreciate your making the effort to come. I also want to pass along that if there's anything further you'd like committee members to have, please pass that to me or the clerk and we will ensure that everyone gets it.

It's a very short session today. I apologize for that, but we have two more sessions. We are going to suspend for a minute, and then we'll ask our next witness to come forward.

Ms. Wendy Sol, we'll ask you to come immediately to the table.

We'll have a one-minute suspension.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you, members. We'll start right off. For the next 30 minutes we have our second witness, Ms. Wendy Sol, who's the administrative vice-president of the Communications, Energy and Paperworkers Union of Canada.

We have you for 30 minutes. You have up to five minutes for an opening statement, and then we'll go immediately to questions from members.

So welcome to the committee, and you may begin your statement.

[Wendy Sol, Administrative Vice-President, CEP Western Regions, Communications, Energy and Paperworkers Union of Canada]

First of all, I want to thank you for the invitation to appear before you today.

I am Wendy Sol, a vice-president of the Communications, Energy and Paperworkers Union of Canada. We represent 150,000 members from coast to coast to coast. My roots in the telecommunications sector come from Manitoba Telecom Services. I worked in the finance department there for about 20 years before I became full-time with the union.

CEP is Canada’s largest union of workers in the telecommunications sector, with members employed at Bell Canada and all of its subsidiary companies. We also represent workers at Manitoba Telecom, at Aliant in the Atlantic region, SaskTel, and Navigata in British Columbia. We are also Canada’s largest union of workers in the media, and most particularly the broadcast sector. For example, CEP members work at CTV, CanWest Global, TV Ontario, CHUM TV, and dozens of radio stations across the country.

CEP members clearly have a huge stake in your deliberations and decisions. As front-line participants in these most important economic and cultural sectors of the country, we see the current push for the lifting of existing restrictions on the foreign ownership in both telecommunications and broadcasting as the number one regulatory issue of the day.

We know that this committee in the past has publicly supported the lifting of the current restrictions. And we know that you have heard from our current industry minister, Mr. Bernier, who has spoken in favour of opening up the sector to foreign control and ownership. I am here today to reiterate our support for maintaining the current regulatory restrictions on foreign ownership of telecommunications and broadcasting, including cablecasting.

While current regulations and policy framework distinguish a separation between telecommunications and broadcasting, the reality is that they have become so technologically and corporately entwined that they should be considered a single industry. Bell Canada Enterprises is more than the largest telecommunications company in the country. It is also one of the major stakeholders in media and broadcasting. Similarly, Quebecor is much more than a publishing company; it controls one of Canada’s most vibrant cable and telephone service providers. And the list continues, from Rogers, to Shaw, to Telus.

Especially with the advent of new media and such services as voice-over-Internet protocol, technological convergence and cross-ownerships have erased the lines between content creator and content carrier. In short, it is our view that you cannot tinker with one part of the industry without massive disruption to the other. If you open telecommunications to foreign ownership and control, we lose domestic control, not only of one of the most important engines for economic development in our country but of our cultural development and our sovereignty as well.

As your fellow parliamentarians on the heritage committee said in their comprehensive report on culture just a couple of years ago:

While American conglomerates such as AOL-Time-Warner and larger cable and telecom operators such as Rogers would like to see foreign ownership limits either raised or lifted entirely, the Committee is of the view that one wrong move could do irreparable harm to the Canadian system. Once this happens, there will be no turning back. For this reason, the Committee believes that the suggestion that ownership restrictions can be lifted in the telecommunications sector without a serious impact on broadcasting content is seriously flawed.

There are other reasons why it makes no sense to turn control of telecommunications over to foreign interests. If everyday operating decisions are made in New York instead of Winnipeg, and if long-term investment plans for network expansion or maintenance are made in Miami instead of Montreal, Canadian social and economic priorities will fall by the wayside. It has historically been and should continue to be a tool to ensure universal, affordable, accessible services to all Canadians and communities.

One last concern we have about turning our Canadian industry over to American interests in particular is the new regulations in the United States by which U.S. companies, by law, must turn over all of their records to the various homeland security agencies south of the border. I question why Canadians would want that kind of loss of privacy. I would argue that Canadians really don't want their conversations to be scrutinized by American security, or any other interests. I know that I, for one, don't. I question whether you do as well.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you very much, Ms. Sol.

We will go to Mr. Byrne for six minutes.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Thank you very much, Ms. Sol.

I appreciate your comments and point of view about foreign ownership and the management of the industry from that point of view. I understand that CEP's membership is basically involved not only in broadcasting but as well on the telecom side.

One of the things we're looking at in terms of this committee is the deregulation of the telecom side and the minister's decision to circumvent—and I don't know if that's the right word—the CRTC decision on forbearance. Does your union have any particular point of view about whether or not there should be forbearance? What's the overall point of view of CEP in terms of that particular rationale of the minister?

[Wendy Sol]

As you know, the telephone industry used to be a very regulated industry, and it's now to the point where there's very little regulation in place, other than for foreign ownership. We, as workers, believe that the entire industry should have been regulated. That being said, we now appreciate that we will no longer have a two-tier system, so all the telephone companies should be able to compete on a level playing field. During the 1990s, that wasn't happening. We had a two-tier system, and I would argue that workers and communities suffered as a result of that.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

So you would agree with the position on forbearance that basically the telcos and the cable companies should be able to compete on a level playing field—

[Wendy Sol]

Yes, equally.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

—in areas where they meet the criteria. That is the position of the CEP.

[Wendy Sol]

Yes.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

I don't think I have any further questions.

Dan, did you want to share the time that is left?

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

Sure.

How much time do I have, Chair?

[The Chair, Conservative, James Rajotte]

You have four minutes.

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

Ms. Sol, thank you very much for being here.

In terms of the work that you and your union have done, I have been extremely concerned about the TPR report. Only a selective few of the recommendations have been made, or provided, by this order for variance.

I'm wondering if your organization, the union, has had an opportunity to examine what the consequences will be for your membership in the days to come should we return to the good old days of having just two basic operators in Canada and urban areas, such as Bell Canada and perhaps Rogers or Shaw or Telus, depending on the region. How do you see this favouring your members in your union?

[Wendy Sol]

Coming from the Manitoba Telephone System, we lived under a crown corporation and we were able to see first-hand what happened when we were privatized. As the witness before me said, they were able, because of their public policy, to offer good service, competitive service, throughout the province.

In Manitoba, since that's happened, the private company now is only going where the cream is, where the money is. When it comes to competition, that's all that the competition is looking for, what is down in the urban centres.

In Manitoba, prior to privatization, CEP had 32 locations across the province and we had well-paying jobs. Now we have three locations across the province. The competition doesn't look at the rural. It doesn't look at the remote areas. So I would argue that by having the ability to compete on a level playing field, MTS is now going to be able to invest back into those rural areas. For them to lose 25% of market share before they can compete with companies that are just as large as MTS, as the previous witness said, is tying their hands behind their backs.

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

In terms, then, of the opportunities that your union has in representing employees, you don't see these new, emergent companies, these new ones that would benefit from the continuation of forbearance, as ones that would necessarily employ your members. Is that your concern as well?

[Wendy Sol]

Our concern is to make sure that when competition comes in, it's not a race to the bottom and that we don't have workers being pitted.... And it's not suggested that they need to reduce their benefits or their working conditions in order to compete.

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

That's interesting, because we're dealing with Bill C-257, and I get a lot of interest in that from your members, as opposed to this issue of telecom. I tend to believe that this issue of telecom will probably be a lot more devastating to the bottom line for your members.

A comment that you had with respect to consolidation and concentration in the number of media that are out there was not lost on this committee, and this member of Parliament has been raising it since 2000. When one player who's in the phone business owns a large national broadcaster and owns a large paper, then only certain things are going to be covered in terms of the media. And the same applies to their competitor, which also happens to own very much the same configuration.

How do you see the next wave of mergers taking place? This is the second time. I'm, of course, very concerned about it. Ironically, those things have never been published in either the National Post or The Globe and Mail. Nevertheless, how do you see these mergers affecting your membership as it relates to multimedia takeovers? You mentioned CHUM, for instance, and A-Channel as an example. I've spoken to a number of journalists. They're very concerned. They've already eviscerated some of their rooms.

[Wendy Sol]

We are very concerned about the concentration of media ownership in Canada. We want the government to put in some regulations to prevent that concentration. As you know, the public out there, if they hear it on this station, pick up that newspaper, and hear it on that radio, they think they're hearing three different points of view, when in fact it's the same aspirations out there trying to get their point of view over. Which brings us to the point of lifting the foreign ownership restrictions. That's a concern.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. McTeague.

We'll go to Monsieur Vincent.

[Robert Vincent, Bloc, Shefford, QC]

Thank you, Mr. Chairman.

Welcome.

I would like to know what is your greatest fear faced with the American juggernaut? What would concern you most if Americans or other big players came to Canada?

[Wendy Sol]

I'll speak to the Americans buying it. On telecommunications, right now under the U.S. Homeland Security department and their laws, they are entitled to hand over all the telcos' records. In fact, although Verizon, BellSouth, and AT&T weren't required to, they handed over a lot of records and were monetarily rewarded for that.

Canadian citizens are going to have American telephone companies doing things like data mining and looking at phraseology on their phones, and they could be linked to terrorist organizations very innocently. So I think Canadians would be very concerned if an American telecommunications provider were to buy up our communications system and hand over those records.

[Robert Vincent, Bloc, Shefford, QC]

How many people do you represent, percentage-wise? Do you represent 90 or 95% of workers at Bell Canada? You do represent Bell Canada's workers, do you not?

[Wendy Sol]

Do you mean across the country?