Mr. Speaker, it is a pleasure to speak on this bill to create the Department of Industry.
I would like to open with a brief outline of Reform's position on economic reform, industrial development and diversification, and how this bill measures up to our vision of the role to be played by the government as well as to comment on the potential for reducing government size and increasing efficiency.
Dealing first with the objective of reduced cost in improved efficiency, if these were objectives, I do not see any significant measures to support any meaningful move in this direction.
When one looks at the figures quoted to us at the briefing for this bill, from a budget of some $3 billion and a staff of some 6,000, the government is only able to save some 230 jobs and $26 million. When one looks at these figures against the potential, it shows very clearly that efficiency and cost reduction were not achieved.
With the bringing together of four departments with some overlap in duties and responsibilities, the potential was there to reduce the payroll by a greater number and certainly save considerably more tax dollars.
When one compares this to what is going on in the private sector in the name of survival, nothing has been done. The message that the private sector heard three years ago about lowering costs and improving efficiency still apparently has not reached the federal government. I do not think that message will be lost on industry when this bill goes forward.
Let us look at the Reform vision of economic reform using some bold brush strokes. We believe an environment to encourage enterprise and initiative should be created by government. There should be productive jobs and prosperity. It is best achieved by a responsible, broadly based, free enterprise economy in which private property, freedom of contract and the operating of free markets are encouraged and respected.
We want to minimize politics in economic decision making by the phasing out of grants, subsidies and lending programs. Let us break down the barriers designed to insulate our businesses and industry from domestic and foreign competition. Competition is healthy and should be encouraged. Of course, we should
come down hard on enforcement of competition and anti-combines legislation with severe penalties for price fixing, certainly the removal of interprovincial trade barriers so that we can maximize the benefits of free trade and NAFTA.
In examining this bill I decided to look at the Liberal red book and determine whether or not the act meets red book promises. One of the first statements made in the red book section on the economy is that the former Conservative government "failed to understand that government has an important role to play in setting the stage and enabling the private sector to adjust to changing circumstances. For this reason our competitive position and our standard of living have declined and jobs are lost".
Of course if this statement is true, then this Liberal government is doomed to fail as well because this act which sets the stage for the Liberal attempt at industrial central planning enshrines in law exactly the same department the Conservatives introduced under Kim Campbell. There is no excuse at this time for the government not to have come up with an act creating a smaller, leaner and more efficient department which would have set the economy on a new course. This government is almost a quarter of the way through its mandate, yet it is still relying on the failed Conservative policies of the past.
What else did the Liberals say in their red book? They said: "Any strategy to foster the growth of a small and medium sized business sector will fail if it does not recognize the negative impacts of excessive government debt, interprovincial trade barriers, and taxation". I agree 100 per cent, but I fail to see how this act to enshrine the industry department created by the former Conservative regime will help to achieve that goal.
It is clear the rationalization of the four agencies and departments into one should have achieved some efficiencies but it appears this did not happen. Staff levels fell less than 4 per cent and spending was cut less than 3 per cent.
As I said, I agree with the red book assertion that debt, trade barriers, and taxation are big negatives in our economy. The minister achieved some gains in his recent attempts to reduce interprovincial trade barriers but I would remind him that much work needs to be done to remove more barriers that are still remaining.
In a widely quoted study done by the Canadian Manufacturers' Association, those interprovincial provincial trade barriers are costing us approximately $6.5 billion. The Macdonald commission of the mid-1980s estimated that Canadian incomes would rise some 1.5 per cent permanently if barriers were removed.
In my own riding of Simcoe Centre there is a brewery which can freely export to 50 American states yet cannot send its products to the provinces next door.
There is another major consideration that this government has failed to deal with. We have unprecedented deficit and debt levels yet this act, which reorganizes the department according to a Conservative plan, fails to achieve any meaningful saving of tax dollars.
Certainly taxes are too high. They discourage new domestic and foreign investment and they drive Canadian businesses to more reasonable tax jurisdictions. I realize that tax relief for Canadian businesses is still a long way off because of a deficit based on excessive government spending but I believe that long term tax relief should be a stated goal of any federal government industrial strategy.
Where could these efficiencies have been obtained? Are there areas of spending and staffing which are of no consequence in our new global economy?
Investment Canada is an organization whose consequence I would question as its mandate seems to have been to protect Canadian businesses from foreign control. What that threat from foreign control was, nobody seems to know. Foreign investment is clearly not perceived as a threat any more because even Investment Canada seems to approve every investment made. I question whether we need to continue to rubber stamp this rubber stamping body any further.
We need to encourage competition in our banking industry. Too much power is held by too few banks.
The defence industry productivity program is another area of spending which we should question. In the government's bid to centrally plan the economy this is an obvious attempt to favour one industry over others. To be clearer on this point it must be recognized that the funding for DIPP came from taxes imposed on other businesses and industries. I question whether the $158 million given away in 1994 under this program would have been better left in the pockets of the taxpayers who are currently financing this scheme.
I question the consequence of spending tax dollars to improve the image of high technology firms. Surely we are misguided if we believe that image is what sells Canadian high technology to Asia-Pacific countries. I believe the quality of our products is our greatest selling point. This is based on such fundamentals as research and development.
I also question why in 1994 the Department of Industry is still treating one group of Canadians as though it were different from all other Canadians. Why does this government continue to single out one group of Canadians for special treatment? This patronizing action should be reversed.
I question the consequences of the complicated university research granting process. Why do we need so many different granting councils with their different regulations and the attendant bureaucracy behind each one? Surely this is an area where
rationalization can occur and efficiencies indeed can result. This is an obvious area for the government to find savings of tax dollars.
We should examine the whole grants and contributions program. What real benefit does the Canadian economy derive from the $63,000 given to the Shoe Manufacturers Association? In favouring de Havilland by $10 million over McDonnell Douglas are we creating inequities in the aerospace industry? Is it not now time to embark on a new direction where we will treat all peoples, regions and industries equally?
Our starting point in making changes should be to place our top priority on reducing government spending while increasing government efficiency. When industries are asked what government can do to help them the response I have heard most often is: "Get off our backs and out of our pockets".
Bill C-46 is a small step, too small, on the road to reducing government spending so that taxes can be lowered, which will improve the ability of our industries to compete and grow in this global economy.