Debates of Dec. 13th, 1994

Communications Security Establishment

[Bernard St-Laurent, Bloc, Manicouagan, QC]

Mr. Speaker, I rise to speak about the anti-scab bill and the minister's commitment to table such legislation, which was supposed to be done some time in December.

In March 1994, in my riding near Sept-Îles, at the QNS & L Company, 300 employees were in a legal strike position and were locked out. The strike or labour dispute was to go on for three months. As soon as the dispute started, the employer rushed to hire scabs.

So, as you can imagine, this led to violence and did not creative a climate conducive to bargaining with respect and dignity by the workers and the employer. The emphasis was on confrontation throughout the process, and there was no attempt to reach an agreement because scabs had been hired.

Last week, I travelled to Decatur, Illinois, with Ogilvie Mills workers belonging to the CSN, who joined fellow workers who are also on strike, sympathized a little, and tried to meet the head of the business in Decatur, where Ogilvie has its headquarters. To all intents and purposes, I have never seen anything like Decatur in my life, although I have witnessed many labour disputes. I was involved in the union movement for a while before being elected to the House of Commons, so I knew what to expect, but it was the first time I saw anything like that. Decatur could be called Dictature City or Scab City, as the people over there call it. It is the same thing.

If you want to work, all you have to do is show up at Decatur. ADM owners hire, on the spot, workers they then send to one of the many places where there is a labour dispute, to work as scabs, because at Decatur, it is normal to work as a scab. So, this creates a climate of incredible violence. Bargaining is the establishment of a power relationship between two groups and in turn, this power relationship creates respect, which ensures that everything will be done in a dignified manner. Then, once this is established, you can talk about a clean, decent labour contract. But as long as there is no anti-scab legislation in place, this cannot be achieved.

In front of the Ogilvie Mills workers here on Parliament Hill on September 19, the minister promised to amend the Canada Labour Code to ban strike-breaking. He was to bring in a bill making the required changes to the code. This sounded rather interesting. But more recently, on December 4 to be exact, the minister backed away, claiming that his department was preparing another bill, a bill on pay equity, which really has nothing to do with anti-scab legislation.

So, based on that, I wonder, and I repeat the question I asked earlier: how can the minister justify his about-face on the need to incorporate anti-scab amendments into the Canada Labour Code? How does he explain this about-face, as I asked him before, except as an act of obvious lack of political courage?

[Joe Fontana, Liberal, Parliamentary Secretary to Minister of Transport]

Mr. Speaker, part I of the Canada Labour Code establishes the framework for industrial relations and regulates the conduct of collective bargaining in the federal private sector.

This jurisdiction covers the operations of enterprises which fall within the definition of federal work, undertaking or business and includes interprovincial and international rail, road and pipeline transportation, air transportation, shipping, longshoring, grain handling, telecommunications, broadcasting, banking and certain crown corporations.

As the Minister of Human Resources Development indicated on December 5 in responding to an inquiry raised by the hon. member for Manicouagan, part I of the Canada Labour Code, including the issue of replacement workers, is currently being reviewed with the view to modernizing and improving it so that it can better reflect today's realities. Creating a legislative framework which is free of barriers to co-operative labour management relationships also supports the initiative of the Minister of Industry in building a more innovative economy.

The minister has asked a senior assistant deputy minister to undertake the review process. This involves a consultative process with business, labour unions and other affected parties to seek their views. The views expressed during the consultative process will be carefully considered prior to introducing amendments to part I of the Canada Labour Code.

The hon. member for Manicouagan also made reference to a dispute involving Archer Daniels Midland Company, formerly Ogilvie Flour Mills, and the Syndicat national des employés des Minoteries Ogilvie Ltée.

The company and the union are currently negotiating the renewal of their collective agreement which expired on January 31, 1992, and which covers approximately 150 flour mill employees. When the parties were to conclude an agreement with the assistance of a conciliation officer appointed by the minister they were placed in a strike-lockout position. The union membership began a strike on June 6, 1994, following the rejection of a company offer on the previous day.

A federal mediator met with the parties in July and October of 1994 but little progress was made. Meanwhile the union filed a request with the minister for consent to file a complaint with the Canada Labour Relations Board alleging that the company had failed to bargain in good faith.

Ministerial consent was granted and the CLRB held a hearing on November 4, 1994, at which time the parties agreed to resume mediation meetings in an effort to settle their differences. The mediator met with the parties November 30 and December 1 and talks resumed today, December 13, 1994.

A federal mediator resumed meetings with the parties today and mediation talks are scheduled to continue December 14 and 15. It is encouraging that the parties are continuing to meet and I am advised some progress is being made. Both sides have been urged to take advantage of this opportunity to arrive at a settlement of their long and difficult dispute.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, pursuant to Standing Order 37(3) I rise to get a more detailed answer to questions I raised on December 5 and 6.

As a person who is concerned about the future of the Canadian Wheat Board I feel it is imperative to point out some of the activities of its government appointed commissioners during the advisory committee elections. I believe these activities point out problems with the board which could, if not immediately dealt with, lead to its demise over the next few years.

The real threat to the Canadian Wheat Board is not from outside but rather from within and result from its lack of accountability and its lack of willingness to change. The main issue to be dealt with is the complete lack of accountability of these appointed commissioners to western Canadian farmers.

This is a concern I have heard from farmers over the past several years. After all, farmers pay all of the operating costs of the Canadian Wheat Board out of their pockets. Why does it seem too much to ask for the commissioners that run the board to be directly accountable to farmers? The only way to ensure that the board of directors is accountable to farmers is by allowing farmers to elect them. There is no other way.

On Monday, December 5, I asked the minister of agriculture about the results of the Canadian Wheat Board advisory committee elections. I mentioned it was no surprise that less than 40 per cent of farmers eligible to vote turned out to elect these largely symbolic positions.

What was a surprise, however, was that leading up to the election, Lorne Hehn, the chief commissioner campaigned for a group of candidates that had a specific political agenda. In addition Richard Klassen wrote an "open letter to prairie wheat and barley growers". Their articles appeared in the Western Producer , Grainews , and many local papers.

Section 17(4) of the Canadian Wheat Board Act strictly prohibits these actions. It states: "It is the duty of the board to exercise direction and supervision over the administrative conduct of an election of members of the advisory committee". Therefore, the role of commissioners parallels that of Elections Canada in a federal election.

By promoting the point of view of one group of candidates the commissioners, I believe, violated the Wheat Board Act and the trust given to the people who hold these positions. On this basis I asked for the resignation of those who knowingly violated politically neutral positions.

In his response the agriculture minister said he would not ask for their resignations because he had no proof to justify these allegations. He also stated it was not unusual for a chief commissioner, from time to time, to defend the policies and practices of the wheat board.

The proof can be found in the chief commissioner's words and in the words of other commissioners. Not only did the chief commissioner openly offer his opinion in the November 17 issue of the Western Producer but he also stated that during the board's 60-year history it is entirely unusual for commissioners to defend the actions of the board.

Hehn states: "The events of recent weeks compel me to violate the long tradition of silence on controversial grain policy issues. I do so at the risk of being accused of meddling". Therefore, Mr. Hehn knowingly violated section 17(4) of the Canadian Wheat Board Act. This is a very serious offence and I am sure the chief commissioner was aware of the consequences.

Clearly, the politically neutral stance of the wheat board was violated by the chief commissioner and other commissioners. It is also clear that the actions of these individuals should be reviewed. Furthermore, it is clear to everyone that farmers must review and make decisions about how their marketing agency should be run.

I have three specific questions for the minister. With this evidence before him, will the minister acknowledge that the commissioners have violated the Canadian Wheat Board Act and the trust given to them? Will the minister ask for the resignation of all commissioners who campaigned during the period leading up to the advisory committee elections? Will the minister replace those political appointed commissioners with an elected board of directors? If yes, when? If not, why on earth not?

[Lyle Vanclief, Liberal, Parliamentary Secretary to Minister of Agriculture and Agri-food]

Mr. Speaker, I would like to point out that section 17(4) of the Canadian Wheat Board Act referred to by the member for Vegreville addresses the administrative requirements for an election of a Canadian Wheat Board advisory committee.

The recent speeches and articles by the Canadian Wheat Board commissioners are a response to producer requests for more information on the board and how it markets wheat and barley on behalf of the producers.

The Canadian Wheat Board commissioners did not campaign on behalf of any candidates. They were responding to those producers who want more information. It is only logical that the wheat board commissioners who are charged with the responsibility of marketing wheat and barley on behalf of the western Canadian producers would be in the best position to describe how they are fulfilling their responsibilities.

As the hon. member well knows, the debate on the issue of grain marketing has been ongoing. It was not initiated with the particular Canadian Wheat Board advisory committee election and it will not end with this election.

As we have stated on numerous occasions, producers need the opportunity to discuss the grain marketing issue in a logical, structured form with all the facts available to them. The producers will be provided with a forum to discuss and debate the issue over the coming months.

Any decision on how we market grains and oilseeds should be made in the context of where we want our grain industry to be in five to ten years from now. As a result, the federal government has initiated discussions with the industry to develop a longer term vision.

[John Solomon, NDP, Regina—Lumsden, SK]

Mr. Speaker, when inflation is high in Canada, bank profits are high. When inflation is low in Canada, bank profits are high. When the economy is in recession, bank profits are high. When the economy is in a growth mode, bank profits are high. When interest rates are high in this country, bank profits are high. When interest rates are low, bank profits are high. They are high in every circumstance when it comes to economic indicators.

The fact is that bank profits continue to be high in this country. In view of the fact that the chartered banks donated to the Liberal Party over $700,000 to the last campaign in Canada and the financial institutions as a whole donated over a million dollars to the Liberal Party slush fund in the last campaign, I am curious to know why the banks continue to get a free ride when it comes to contributing their fair share to building Canada.

In the last year alone the six major chartered banks in Canada reported profits of $4.3 billion. The chartered banks have an important role in our country's economy due largely to the regulations that are in place under the Bank Act. With the privilege of banking should come the responsibility of assisting in the development of our economy.

The Minister of Finance agrees that Canada's deficit is a serious problem. He, in consultation with the Minister of Human Resources Development, has made it clear that they will be making cuts and reductions to Canada's social security programs. Many Canadians have experienced the hardship of the recession and also faced cutbacks to their unemployment insurance coverage.

The Minister of Finance has made it clear that we will all be tightening our belts to help pay down Canada's debt. Meanwhile we have the banks in Canada that have made huge profits during hard economic times. They have made their profits on the backs of Canadians. It is money that is made on the spread of interest rates, financial transactions and on the government debt.

Another reason is bank service charges. Service charges are one of the fastest growth areas for banks. They allow the banks to continue making money in hard times and in good times.

I believe the government should ask the banks to justify their banking practices and their actions. As responsible corporate citizens the banks have a moral responsibility to pay their fair share of taxes and to reinvest their wealth in Canada and create jobs.

The Minister of Finance has a responsibility to regulate the banks and ensure that they participate in our country's economic recovery.

Bank customers receive interest rates of 2 per cent or 3 per cent on their savings accounts while being charged up to 11 per cent on their loans. The interest rate spread is wide and the banks are the winners on the spread.

After 127 years of Liberal and Conservative governments in Canada we are approaching $550 billion in debt. There has been no job creation as a result of this latest bank manoeuvre. The banks have made profit by cutting back on staff as a matter of fact. A year go the Royal Bank announced the need to slash 3,000 jobs from its payroll as well as another 1,100 jobs from its newly acquired Royal Trust, because of the recession its said.

Is the Royal Bank now willing to create 4,000 new jobs or is it going to continue to make profit at the expense of its former employees? The answer to that is not likely.

The Royal Bank in 1993 year end made profits of $324 million and paid absolutely no taxes. As a matter of fact, it received from the federal government and the revenue department $5 million in tax credits.

Two years ago the CIBC announced cutbacks of 2,500 jobs. In fact, 14,000 banking jobs have been eliminated in the past four years. Banks reasoned that cutbacks were necessary but now we see their profit margins. The banks lost money on bad real estate loans primarily over ambitious commercial projects in foreign countries. As well, they have lost money loaning money to other countries without providing the same equity backup and guarantees that individuals in Canada must provide.

I am asking in summary that the government provide leadership on this issue and ensure that the banks make a stronger contribution by paying their fair share of taxes back to this country and to institute a fair interest rate policy and to justify some of their monopolistic practices so that Canadians do benefit from banks when they make a profit.

[David Walker, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, over the past few weeks six major banks have reported their profits for the year ending October 31, 1994. The six largest banks reported profits of over $4.2 billion, a 47 per cent increase over last year. This has prompted some

observers to ask whether the banks are paying their fair share of tax.

Banks do pay considerable amounts of tax. Banks pay income taxes and are subject to two federal capital taxes, the large corporations tax which applies to all corporations with more than $10 million of capital, and the financial institutions capital tax. This latter tax is paid annually at an average rate of 1.25 per cent of capital. This tax is designed as a minimum tax for banks and other large financial institutions.

Over the past five years the six largest banks and their mortgage subsidiaries paid on average $850 million per year in federal income and capital taxes. In 1991 and 1992 they paid around $1 billion per year in federal income and capital taxes.

Banks also paid income, capital, property and other taxes to provincial and municipal governments.

The hon. member is no doubt aware that further measures were introduced in the 1994 budget to ensure that banks and other financial institutions continue to pay their fair share of tax. These changes will improve the measurement of income on securities and loans held as part of their ordinary course of business.

[The Acting Speaker (Mr. Kilger)]

Pursuant to Standing Order 38, the motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 24.

(The House adjourned at 8.19 p.m.)