Mr. Speaker, I rise to speak this evening on Bill C-237, an act to amend the Bankruptcy Act.
I appreciate the history lesson from my hon. colleague in the Bloc who went through all of the trials and tribulations to tell us how we managed to arrive at where we are today. I also appreciate the comments by my Liberal colleague who explained the Bankruptcy Act and the fact that a great deal of thought went into the Bankruptcy Act as it is today.
It is rather ironic that I stand here to speak on amendments to the Bankruptcy Act when I was an intervener back in 1991, three years ago when it was being reviewed. I guess we have come full circle. I now stand in the House making comments on potential revisions to the act when three years ago I was making revisions as an accountant on behalf of an organization that had an interest in representing its members as far as the Bankruptcy Act provisions at that time were concerned.
Speaking to the amendments, I find the bill poorly drafted, I am afraid to say. We cannot agree and support the measures being put forth. We do not feel a great deal of thought has been put into the bill. Unfortunately I see it as being ideologically driven, wherein the workers have been put first and absolute in front of everything else with no real consideration to the other parties that have or may have input and deserve consideration in the event of bankruptcy.
It is a socialist position, not only a position of the Bloc separatists. It seems to be socialist as well and perhaps the position of successors to the party that has one or two members on the backbench here.
The first line of the bill states:
Notwithstanding any law or any other provision in this or any other federal or provincial Act-
This puts it as number one, right up there with the charter of rights or perhaps even ahead of the charter of rights. It is a constitutional document because it puts it ahead of all provincial acts at the same time.
If every bill we debated in the House of Commons were to start by saying notwithstanding any other provisions or any other law, how would we ever determine which one would take precedence? It would be impossible. That is why I say even the wording is poorly drafted law. We cannot support the way it is presented.
Subclause (a) talks about giving protection to employees in the amount of $9,000. Three years ago the act allowed $2,000. We have not had inflation of the kind that we would want to multiply it by four and a half times to get up to $9,000 today.
The mover of the bill is also saying that in the event of a bankruptcy and money owing to an employee in an amount of up to $9,000, that money can either be paid into his pension plan or paid to him in cash less normal deductions.
It does not say which one because it says the money could be put into his pension plan as well as wages, salaries, commissions and so on. "As well as" does not tell us which one would take priority. If a trustee in bankruptcy were to put the money into the employee's pension plan while the employee was destitute and the employee was denied access to the money even though it was in his name, how better off would he be?
As it is written, Bill C-237 says that the trustee has a choice. He can put it into the employee's pension plan or he can give it in cash less deductions. He does not even have to take the employee into consideration to see what is most beneficial to him. Unfortunately the act is poorly drawn.
It rearranges the whole order. The act as it currently stands gives priority to secure claims. My hon. colleague on the Liberal side talked about the super creditors and so on. Notwithstanding, as it stands today first are the secured creditors, followed by funeral expenses, undertaker's expenses and so on to look after the unpleasant side of things that the trustee should pay for in the case where the bankrupt is deceased. Then it goes on to pay the trustee's own expenses and talks about wages and salaries.
Wages are number four because the first three items are important. We would not want to pay an unsecured creditor and not pay the undertaker. How would we ever get trustees to wrap up a bankruptcy if their fees took less precedence than the money paid to wage earners who are unsecured creditors? Who would ever do the job? Who would ever pay them? That is why
the Bankruptcy Act as it reads today puts these things ahead of payments to wage earners.
As an hon. colleague asked, what about the banks? What is their attitude to the situation? Let us take the situation of a good sized company of 110 employees. If it had not paid its employees it would have a liability of $1 million. That is the first priority ahead of all other laws, notwithstanding any other law, provincial act or anything else. Are the banks going to lend that company money? Of course not. There is no way that a bank is going to lend money to a company when there is a potential liability of up to $1 million that it will always rank ahead of the government or the bank security.
Therefore business will find that it is unable to raise cash because of that point. Business will decline and unemployment will go up. There will be more and more bankruptcies created by this particular change in the law. I do not think that was the intention of the member who moved the bill.
I do not think it was the intention of the mover to create unemployment. I think the mover was coming at it from the point of view of trying to protect the rights of wage earners. I have no problems with that whatsoever, but we must recognize that the member is actually proposing in the law to create more unemployment and to cause more business failures. He is going to deny business the ability to borrow money. By doing all these things the matter is being made worse rather than better.
The member talked about the compensation plan that was proposed before, but who was supposed to pay for it? The idea was to lump the cost and pass it on to the employer.
The employer is the guy who takes the risks. He is the guy who gets the money left in the till at the end of the day after he has paid for all other obligations, including wages to his people. If there is next to nothing in the till, that is all he gets for his hard work.
I had an accounting business before I got into this political game and I used to deal with many small business people. I said to them that unfortunately in many cases small business people work twice as hard and earn half as much as the people they employ. They said that was right but they enjoyed the freedom of having their own business and they accepted the risks. Unfortunately I saw cases where some businesses did not make it. The point is that they were working hard and as best as they possibly could for the benefit of themselves and the people working for them.
That is the recognition of the role small businesses play in our economy. We should not hamstring small businesses to the point that we expect or assume they are out to gouge their employees and to take them to the cleaners. I can assure the hon. member that in all my experiences with small business people they have gone to great lengths to ensure that their business is viable and that they can look after their employees to the best of their ability.
In wrapping up, I have looked pragmatically at the bill as a Reformer. I recognize the hon. member is trying to protect wage earners, but if he really looked at what this bill would do, he would find that is not the case. Hopefully the hon. member will come around to seeing it in the same way Reformers do. Unfortunately the bill is not acceptable and therefore the Reform Party will not be supporting it.