International Trade Committee on April 17th, 2023

[The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)), Liberal, Judy Sgro]

We are in a public session.

Mr. Savard-Tremblay, you can speak to your motion.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Thank you, Madam Chair.

The committee members have before them my motion, which would prevent further filibustering, while giving all parties the opportunity to add meetings and call their own witnesses. So we will be able to truly examine the issue thoroughly.

I believe that this proposed compromise could work for everyone. Our colleagues have wasted enough time on this—

[The Chair, Liberal, Judy Sgro]

Hold on. We lost translation.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Can you hear me? Do we have interpretation?

[The Chair, Liberal, Judy Sgro]

You can start again.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Okay. I will continue.

The motion speaks for itself. Its purpose is to avoid any filibustering on Bill C‑282; there's been enough of that. We were able to devote the required number of meetings to this issue.

I would never let myself be compromised, but I do believe in compromise. I agree wholeheartedly. Our friends the Conservatives wanted to be able to interview trade law experts and former negotiators. My motion will allow them to be called. We will also be able to call senior officials again.

I feel my motion will really work for everyone.

[The Chair, Liberal, Judy Sgro]

Mr. Virani, go ahead.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Thank you, Madam Chair.

I'll confess to having some of the same surprise Mr. Savard-Tremblay mentioned regarding how the study of Bill C-282 has unfolded. Given specifically the fact that all officially recognized parties in the chamber voted in favour of this bill at second reading, I've been a bit surprised at some of the obstruction and delay tactics that His Majesty's official opposition has used, including filibustering this bill at our very committee.

I think the motion itself is well received by all parties. It should be well received by all parties that actually want to conclude this study and ensure the bill gets returned to the House of Commons so that it can in fact be passed in the chamber. I think the appropriate compromise that Mr. Savard-Tremblay has struck here is articulated in the text of the motion.

To make it extremely clear, what I would suggest is that where the motion reads, “that the Committee allocate a maximum of four consecutive hours, divided into no more than two meetings”, I would insert a phrase, right after the comma, so it would say, “divided into no more than two meetings, one of which will include hearing from witnesses, to complete the said study”. Then it would just continue. This makes it abundantly clear to my Conservative colleagues that we are in agreement with them that additional witness evidence should be heard. A determination can be made as to what kind of witnesses those should be, apropos of what Mr. Savard-Tremblay has just mentioned.

In the spirit of compromise, we can hopefully work together as a committee, ideally unanimously, to complete the study with these two meetings, one of which would be with witnesses and the second of which would be for clause-by-clause. Then we would report the bill back to the House. I think that's what any defender of supply management, including His Majesty's official opposition, ought to do in this case.

Thank you, Madam Chair.

[The Chair, Liberal, Judy Sgro]

I have Mr. Baldinelli, Mr. Seeback and Mr. Savard-Tremblay again.

Mr. Baldinelli, go ahead.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you, Madam Chair.

Could you just repeat the speaking order for me?

[The Chair, Liberal, Judy Sgro]

It's Mr. Baldinelli, Mr. Seeback and Mr. Savard-Tremblay.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you, Madam Chair, for this opportunity to speak to the motion of my colleague Mr. Savard-Tremblay, which was submitted to committee members by way of notice of motion on Thursday, April 13, 2023.

As written, the motion reads:

That the Committee commence clause-by-clause consideration of Bill C-282—An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management) on Thursday, April 20, 2023; that the Committee allocate a maximum of four consecutive hours, divided into no more than two meetings, to complete the said study; and that, if at the end of the four hours provided for, the Committee has not completed its deliberations, Bill C-282 be deemed to have been adopted, and that it be thereby referred back to the House.

At this point, let me first say that I find this motion entirely disappointing simply in that this committee has yet to conclude discussions in consideration of motions that have already been tabled at this committee. In fact, these motions were submitted by my colleague Mr. Seeback. One notice of motion was submitted on Tuesday, March 28, 2023, and stated:

That the committee extend, by at least 2 meetings, the study on Bill C-282, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management), to ensure trade experts are able to provide testimony and for departmental officials to return before clause-by-clause to speak to questions raised about their initial testimony.

Another notice of motion was submitted by Mr. Seeback on Tuesday, March 28, 2023, which stated:

That the committee hold one additional meeting to invite back departmental officials prior to clause-by-clause, to testify on Bill C-282, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management), regarding urgent concerns raised about the legislation during witness testimony; and that the committee hold no less than three additional meetings to ensure all witnesses can testify in person.

Second, in terms of the motion put forward by Mr. Savard-Tremblay, I find it an insult to my parliamentary privilege that somehow, if discussion and debate on this legislation are not completed in a time period designated by my colleague only, this committee will then deem the legislation to have been passed. I deem that to be an affront to my privileges and to those of the citizens who sent me here.

If you know anything about my fine riding of Niagara Falls, it's that it is home to, I would suggest—and this is not to be taken as a slight to my colleague from South Okanagan—West Kootenay—the best wine region in Canada. We continue to pay the price of this government's regressive escalator clause on alcohol, which was passed by this Liberal government in 2017 despite Conservative objections. What is the result? Every year without parliamentary approval, our sector suffers a continued death by a thousand cuts in having to pay more taxes when the margins within the sector are already thin.

If I may, I will remind the members of this trade committee that it was the actions of the minister in not negotiating a resolution to the creation of this new escalator clause that resulted in Canada's losing a World Trade Organization challenge to our previous excise exemption for 100% Canadian-made wines. As you will remember, when this exemption was put in place by a previous Conservative government in 2006, the industry grew from some 300 to 400 wineries to over 700 wineries employing over 9,000 workers.

Why do I raise this? It's because government actions or lack thereof matter. Every member of this committee has signalled their support for our supply-management system. I dare say I may be the only one who worked directly for one of those sectors when I worked as a consultant for the Dairy Farmers of Ontario in the late 1990s and the early 2000s. However, that work has not clouded my judgment or my desire to study, examine and perhaps make recommendations, which can take what I believe is a flawed piece of legislation and make it one that everyone can support and subsequently vote on, rather than what my colleague's motion proposes to do, which is to simply deem this legislation adopted.

As the member from Dufferin—Caledon has indicated, many questions remain, not only based on the testimony provided by our government officials but by several others who have yet to have an opportunity to appear. Would this international trade committee not benefit in any way from hearing from international trade experts? Why is there hesitancy in that? Surely, if Canada's chief NAFTA negotiator, Steve Verheul, could be invited to attend the recent state dinner held in honour of the President of the United States' visit to Canada, he could be invited to appear before this committee so we can ask him his opinion on this legislation.

In terms of the concerns I would like to raise, they simply come from the interactions of the bill's sponsor, the honourable member for Montcalm, Mr. Thériault, when he presented the legislation to this committee on Thursday, February 16, 2023. During the initial questions, my colleague Mr. Seeback asked Mr. Thériault, “Did you consult any other agricultural groups with respect to their views on this piece of legislation, and if you did not, why not?” In response, Mr. Thériault stated, “If memory serves, the other groups stated their positions during the study of Bill C-216. One only has to look at the blues to see what their views are.”

Mr. Seeback then followed up by asking Mr. Thériault, “Outside of agricultural groups, did you consult any other industries—for example, aluminum or steel—on whether they thought that taking supply management out of the minister's ability to negotiate an international trade agreement would affect their opportunities within a trade agreement?” Mr. Thériault's response was, “No, absolutely not.”

I'm not sure if others are concerned by this; however, I am. When a piece of legislation that has the potential to fundamentally change how our government and trade officials undertake negotiations in the best interests of all Canadians is fundamentally changed, one would think the input of trade experts in other agricultural sectors would be taken into account.

I think this point was made quite strongly by our colleague Mr. Arya from Nepean when he stated at the meeting, “International trade is very important to Canada. Almost two-thirds of our GDP comes from international trade. Our prosperity and the standard of living that we enjoy today are basically due to international trade.” He then posits his views:

What your bill proposes will almost kill the ability of Canada to further our international trade, not only in terms of the new trade agreements we need to negotiate but even for the existing ones. There will always be issues there that need to be looked into.

Even with our small number of Canadian farmers, we are ranked fifth largest worldwide in terms of exports. There is a tiny number of Canadian farmers.

[The Chair, Liberal, Judy Sgro]

Mr. Baldinelli, I'll just interrupt for a moment. You're referencing motions that I believe Mr. Seeback introduced confidentially. Your comments should not be referencing Mr. Seeback's motions. One was moved; the other one wasn't, but that was done in confidential sessions.

I'm told that the two he had previously moved were not confidential. However, the third one, which hasn't been discussed or debated, is still a confidential motion.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

I apologize to this committee, Madam Chair, for that slight. It was an oversight.

I'll go back. Again, I'm speaking to Mr. Savard-Tremblay's motion, why we need further examination and why I deem his motion unacceptable. I'm going back to some of the comments I made and some of the experts we've heard from.

I'll finish up the quote from our initial meetings. Again, this is with Mr. Arya from Nepean, our colleague, when he was talking to Mr. Thériault during the initial conversations. I'm going to go back and start over. He said this to Mr. Thériault:

International trade is very important to Canada. Almost two-thirds of our GDP comes from international trade. Our prosperity and the standard of living that we enjoy today are basically due to international trade.

What your bill proposes will almost kill the ability of Canada to further our international trade, not only in terms of the new trade agreements we need to negotiate but even for the existing ones. There will always be issues there that need to be looked into.

Even with our small number of Canadian farmers, we are ranked fifth largest worldwide in terms of exports. There is a tiny number of Canadian farmers.

He went on to say:

Have you consulted with Pulse Canada, the Canola Council, the Grain Growers of Canada, the Canadian Pork Council, Cereals Canada or the Canadian Cattle Association? These are the sectors that work hard and that are the first to leverage every new international trade agreement Canada signs so we can increase exports from Canada. Have you consulted with any of them?

Unfortunately, this committee did not receive a detailed response to that specific question. It was not for lack of trying by Mr. Arya, however, who again asked:

I would like to ask the witness again: 90% of the farms and agri-food businesses that are represented by the Canadian Agri-Food Trade Alliance say they strongly oppose Bill C-282. When I was listening to the witness's comment, Madam Chair, I heard the fluctuations and how, when it fluctuates downwards, small producers will get decimated.

The same thing applies to every single industrial and business sector, so every single sector can demand a clause like this, barring the government from negotiating anything to do with their sector when it goes in for new free trade agreement negotiations. It means that Canadian international trade has to collapse. Is that not the case?

These are very valid comments raised by my honourable colleague, which is more troubling, I would suggest, when you consider they are the same views held by many government officials who came before this committee in 2021 to study a bill very similar to Bill C-282. Bill C-216, from the 43rd Parliament, was tabled before, and it was an act to amend the Department of Foreign Affairs, Trade and Development Act with regard to supply management.

If I could—I apologize—I just need a little water.

[The Chair, Liberal, Judy Sgro]

I'll ask Mr. Baldinelli, while he takes a glass of water, to please keep his comments directed to Mr. Savard-Tremblay's motion. Keep them pertinent to his motion.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Chair, all these comments are about why I find it troubling that we're putting a finite time limit on ending debate on this piece of legislation. Our job as legislators is to take a piece of legislation and make it the best piece of legislation we can put before the House of Commons. That's my job. That's my pledge to the people I'm here to represent. This is a flawed piece of legislation and we can make it better.

Again, we all gave support at second reading. We also support supply management. To go back, I worked for the Dairy Farmers of Ontario during the 1990s and early 2000s, and I deeply support supply management. However, this bill is flawed. This is about taking a piece of legislation and making it better. Mr. Savard-Tremblay's motion prevents me from taking the necessary time to make this a better bill.

It's my right as a parliamentarian to use the information that I'm prepared to share, which is explaining to you why government officials in 2021 were adamantly opposed to legislation similar to this bill. However, today they are not. I think we need more examination. That's why we're calling for further studies. That should be looked at.

I'm just sharing with you my thoughts on this, Madam Chair. I'm going to continue doing that.

During the committee's hearing on this legislation on June 11, 2021, trade officials were able to attend and speak to this bill and present their feelings on the proposed actions to formalize excluding supply management from future trade agreements that Canada undertakes. I think it's important to present this information.

Doug Forsyth, director general of market access at the Department of Foreign Affairs, Trade and Development, stated in his opening remarks on June 11, 2021, “The intent of the bill is consistent with the long-standing Government of Canada policy to defend the integrity of Canada's supply management system.” We're all here and we can all share those views.

He then goes on to indicate some concerns when he mentions the following:

...amendment of the departmental act in the way in which Bill C-216 proposes carries risks. By limiting Canada's ability to engage on these issues, this amendment would invite negotiating partners to narrow the scope of their own potential commitments, taking issues off the table from the outset of negotiations, likely in the areas of commercial interest to Canada. This narrows possible outcomes, precludes certain compromises and makes it harder to reach an agreement.

Addressing the interest of any specific sector in the act would set a precedent that could lead to demands for additional amendments to reflect other foreign and trade policy objectives, including sectoral interests, further constraining the government's ability to negotiate and sign international trade agreements and, more generally, to manage Canada's international relations.

Further on in his opening remarks, he mentions this:

The government has made public commitments not to make further concessions on supply-managed products in future trade negotiations. In fact, Canada has been able to successfully conclude 15 trade agreements that cover 51 countries while preserving Canada's supply management system, including its three pillars: production control, pricing mechanisms and import controls.

Most recently, the Canada-United Kingdom Trade Continuity Agreement fully protects Canada's dairy, poultry and egg sectors and provides no new incremental market access for cheese or any other supply-managed product. Where new market access has been provided, specifically and exclusively in the Canada-European Union Comprehensive Economic and Trade Agreement, CETA; the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP; and the Canada-United States-Mexico Agreement, CUSMA, the access was deemed necessary to include an agreement that was in Canada's interest.

While new access was provided in those agreements, the supply management system and its three pillars were maintained. These outcomes were part of the overall balance of concessions through which Canada maintained preferential market access to the United States and secured new access to the European Union, Japan, Vietnam and other key markets.

In conclusion, while the spirit of Bill C-216 is consistent with the government's policy of defending the integrity of Canada's supply management system, amending the Department of Foreign Affairs, Trade and Development Act as proposed by the bill would change its nature and create risks.

During that hearing, my colleague Mr. Aboultaif from Edmonton Manning asked Mr. Forsyth the following question:

With different markets and different conditions when you negotiate trade deals, you have to have flexibility and you have to have options in order to be able to achieve agreements. I know that Bill C-216 is aiming to somehow further protect supply management or preserve it, as Mr. Forsyth just said, but in the meantime, it carries risk, which Mr. Forsyth also stated in his opening remarks.

What I'm interested in is this. Although we've signed so many trade agreements without having to really jeopardize the supply management system and we have successfully done that throughout its history—and we have so many trade agreements that I don't have to mention it at the moment—the question is, are there any live examples out there that can advise us on what the consequences will be in the long run if Bill C-216 is implemented, since we know that we will lose that flexibility and we will be limiting our team of negotiators on the road when they try to achieve trade agreements with countries in the world?

Mr. Forsyth's remarks were revealing in the sense that they told us what would happen if proposed legislation such as Bill C-282 were to be implemented. Speaking to Bill C-216 Mr. Forsyth states:

I would just note off the top that our supply management system, as you've indicated, has not stopped us or hampered us from concluding any trade agreements, but I think what is certainly possible is that the wording proposed for this bill will give trade negotiating partners pause with respect to wanting to engage with Canada. From a trade negotiator's perspective, when we start a negotiation, we like to start with the full possibility of access in the back of our minds, whether or not that's where we end up. It's rarely the case that you would see 100% access in any free trade agreement, but you like to at least start with that notion in mind.

As you go through a negotiation with your various partners, you find that interests are enunciated, elaborated and narrowed down. You understand what's in the art of the possible, but you like to start as wide as possible when you do launch those negotiations. When you start—

I think this is key.

—from a very narrow band of possibilities and then that gets narrowed, the scope of the negotiations and the scope of the agreement is very much smaller than you would have seen otherwise.

If we were to end up with this bill as it is written, I think very much that we would start with a much smaller scope of negotiations with various partners. It wouldn't be unusual for them to say “That's fine. Canada has taken these issues right out of play. We will take issues that are of interest to Canada right out of play.” Then you're talking about negotiating from a smaller pie, as it were.

I think that's huge.

Then Mr. Aaron Fowler, who was chief agriculture negotiator and director general of trade agreement and negotiations at the Department of Agriculture and Agri-Food at the time, provided some comments on this by indicating, “I would certainly agree with everything Doug has said so far and associate myself with his response.”

Further on in questioning, presented this time by Ms. Bendayan from Outremont, Mr. Forsyth was asked, “Mr. Forsyth, could you explain to us whether, in your view, the adoption of this bill is necessary for the government to continue to defend Canada's supply management system?” Mr. Forsyth responded with this:

As I mentioned in my opening statement, since supply management was introduced, which was well over 50 years ago, various governments of various stripes have been very clear about defending the supply management system and ensuring that everyone understands how well it works for producers and farmers all across Canada.

I think the government has done a very good job of promoting and ensuring that all of our trading partners understand what supply management is. It's certainly part and parcel of all trade negotiators' mandates that we understand it well, that our trading partners understand it well, and that throughout the world, whether bilaterally or multilaterally—for example, at the World Trade Organization—it is well known what Canada's policy is.

To answer your question as to whether it would have any effect, I think that, as I said, the policy is well known and well understood, so I am not sure that there would be any.

Imagine my surprise, then, when after reviewing just some of the testimony from 2021, some differing views began being postulated by government trade officials when they came before us to examine Bill C-282.

I want to again bring into the record some of the comments of Mr. Fowler, who is now the associate assistant deputy minister at the Department of Foreign Affairs, Trade and Development. He provided opening comments during his visit to our first session. In his comments, Mr. Fowler stated:

The intent of [Bill C-282] is consistent with the long-standing Government of Canada policy to defend the integrity of Canada's supply management system. In practice, this policy has allowed Canada to successfully conclude 15 ambitious free trade agreements covering 51 countries while preserving Canada's supply management system, including its three pillars of production control, pricing mechanisms and import controls.

These comments are almost verbatim to those provided in 2021; however, Mr. Fowler then goes on to indicate:

...Bill C-282 proposes to make the government's commitment to make no further market access commitments for supply-managed products into a legal requirement by amending the Department of Foreign Affairs, Trade and Development Act. This would strengthen the policy of defending the integrity of Canada's supply management system by enshrining it into law.

These comments seem to contradict the viewpoints and position of government officials, primarily those of Mr. Forsyth, who on Friday, June 11, when speaking to Bill C-216 from the 43rd session of Parliament, stated:

By limiting Canada's ability to engage on these issues, this amendment would invite negotiating partners to narrow the scope of their own potential commitments, taking issues off the table from the outset of negotiations, likely in the areas of commercial interest.... This narrows possible outcomes, precludes certain compromises and makes it harder to reach an agreement.

Madam Chair, I think I'll wrap up my comments there and leave it to my colleague Mr. Seeback.

[The Chair, Liberal, Judy Sgro]

Mr. Seeback, you are next on the list to speak to Mr. Savard-Tremblay's motion.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Great. Thanks very much.

I echo some of the concerns that we've heard from Mr. Baldinelli. I think my concern with this motion is.... I'm happy that other members of the committee have recognized, through this motion and through their comments, that some additional evidence would be good for the committee. I feel like that's progress. I'm pleased that my commentary at the last committee hearing has moved some folks to think that we should have some extra committee hearings on this. I think that's a great step in the right direction. I thank all my colleagues for recognizing that.

The concern I have is this. Perhaps there's a way that this motion could be amended so that everyone could vote for it. I'd like to see that. I'd like to see some consensus here at the committee on this, but the suggestion that there are only four more hours and—even if deliberations have not been concluded—that the bill will be deemed adopted and referred back to the House is very challenging, Madam Chair.

I can give an example. I have some motions, as we know, to amend the bill. I know we're not supposed to talk about that, but I do.... Let me say this. I will be bringing forward some motions to amend the bill. I think that's fair to say. All some colleagues would have to do, then, with this type of motion—which says we report the bill back and adopt it as is—is to take one meeting to speak to those proposed amendments, so they never come to a vote and the bill gets reported back as is.

That's a big problem with this motion for me because it means that any potential amendments.... Other people may want to put forward amendments on this as well. With a motion like this, there is absolutely no guarantee that those amendments would ever actually come to a vote, because all someone would have to do is talk for two hours. That's possible, so that's the problem with this motion. It's a reason why I'm certainly not able to support the motion.

The other thing, Madam Chair, is that we were actually very close to concluding the Inflation Reduction Act study. Therefore, I move to adjourn debate so we can return to the study of the Inflation Reduction Act.

[The Chair, Liberal, Judy Sgro]

Mr. Seeback has moved a motion to go back to the IRA debate.

Read it out again. Make sure everybody is clear on what they're voting on, please.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

I move that we adjourn debate to resume the study of the Inflation Reduction Act report.

[The Chair, Liberal, Judy Sgro]

Is everybody clear on what they're voting on? We'll go to the vote.

(Motion negatived: nays 7; yeas 4)

With the support of the committee, I will adjourn the meeting.