Natural Resources Committee on Dec. 6th, 2007

[Jacques Hénault, Analyst, Nuclear Liability and Emergency Preparedness, Department of Natural Resources]

I'm going to answer your question as best I can.

The minister has to approve the insurer, but that has nothing to do with the fact that he has to approve the alternate security.

I don't really understand the meaning of your question. These are two separate things.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

I have a question, Mr. Chairman.

[The Chair, Conservative, Leon Benoit]

Madame DeBellefeuille.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Thank you, Mr. Chairman.

I don't understand your answer, Mr. Hénault. Does the 50% also have to be evaluated by the minister?

[Jacques Hénault]

Yes.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

If the 50% has to be evaluated by the minister, what does it matter if we keep that percentage? In any case, he has to evaluate all the financial security presented. That's what I don't understand.

I also don't understand the answer you gave Mr. Ouellet.

[Jacques Hénault]

Last Tuesday, Mr. McCauley mentioned why we wanted to retain the 50% portion of the security covered by the insurance.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Do you agree with me, Mr. Hénault, that 100% of the financial security given must be presented to the minister, who must in turn authorize it? The text of the bill is complicated. Did I understand correctly? In spite of everything, you're saying that 50% has to be secured. I don't think that's clear and I would like to understand.

[Dave McCauley]

The minister has to approve all security, 100%. If it's 50%, he has to give his approval of the financial security.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Do you agree with me that 50% has been put in the text of the bill merely to guarantee a market for the insurer that has shown an interest in insuring all our nuclear facilities?

[Dave McCauley]

No. I don't like the words “guarantee a market for the insurers”. It's more to retain a separate amount intended for another independent part of the operators in order to secure the risks because the insurer maintains reserves for the purposes of the nuclear liability system.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

I wouldn't want to misrepresent the remarks Mr. Harris made last Tuesday. He said that not a lot of insurers would agree to ensure nuclear facilities because it's risky. If it's risky, that's because it's dangerous. People would like us believe that nuclear energy is without danger, reliable, cost-effective and so on, but today we're discussing a bill on insurance and compensation. That's because there's a risk.

Consequently, if we retain this 50% requirement, won't we be depriving power station operators from going and negotiating better premiums and better coverage elsewhere, in other countries?

[Dave McCauley]

It would be possible for operators to negotiate a better premium with other insurers. However, under the bill, other insurers would have to obtain the minister's authorization in order to insure the operators.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Why the 50%?

[Dave McCauley]

It's just an amount to insure a separate third of insurance or a security that is separate and independent of other means.

[The Chair, Conservative, Leon Benoit]

Did you have something to add, Mr. McCauley?

[Dave McCauley]

I'd like to add that the 50% figure can be increased or reduced by regulation. It's not a fixed amount because it can be adjusted.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

I have one final comment, Mr. Chairman.

I get the impression this is interpreted as a lack of confidence in the minister. If the minister has the power to analyze and recommend financial security, the fact that there is the 50%, in addition to a clause on his power, reflects a certain mistrust. Is there some mistrust of the minister, whoever he or she may be? The attack is not personalized. Is the minister's power being reduced in a way?

[Dave McCauley]

Perhaps it's to get something stable and reliable. Insurance is an independent third party. Without other financial securities, there is always a possibility of risk. Insurance is something a little more concrete.

[The Chair, Conservative, Leon Benoit]

Thank you.

We will now go to the vote on the Bloc amendment. It's Bloc amendment 3, and it would strike subclause 24(3).

(Amendment negatived [See Minutes of Proceedings])

[The Chair, Conservative, Leon Benoit]

We agreed to do amendment 3 before 2. We'll now go to Bloc amendment 2.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Mr. Chairman.

[The Chair, Conservative, Leon Benoit]

Yes, Madam DeBellefeuille.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

I want to withdraw the amendment.

[The Chair, Conservative, Leon Benoit]

Okay, that amendment is withdrawn.

(Clauses 24 and 25 agreed to)

(On clause 26—Reinsurance agreements)