Bill C-99, an act to amend the Small Business Loans Act, is the one I am talking about. That is the bill that is on the agenda at the moment. My hon. colleague from the Liberal Party says that is not the bill. I am quoting right from the bill. Does he not know what we are talking about right now and what the bill says? The bill states "small business loans program to full cost recovery". Let us talk about this full cost recovery.
The government has lots of power. It is going to establish an annual administration fee to collect money from the lenders, put it in a pocket and it is going to restrict the lenders from passing on the fee to the borrowers, except through interest rates. The government is going to say to lenders: "We are going to charge you an administration fee of maybe 1 per cent or 2 per cent of the amount of money that you are lending out. You are prohibited from charging your borrower an administrative fee but you may include it as a mark-up on your interest rate". Remember full cost recovery.
The lenders will have to pay to the government 1 per cent or 2 per cent of the total money they lend out. The government will take this pool of cash and reimburse the lenders who make bad choices because they are the ones who are going to collect the guarantee from the government.
I scratch my head trying to figure out the logic because I cannot find any in this particular bill. It says that the government, by skimming money off the prudent, intelligent lenders who made intelligent, prudent investment decisions are required to pay a premium to the government so that it can build up a pool of cash to reimburse the lenders who made poor and irrational decisions. It does not make sense. We are penalizing good and competent lenders and subsidizing incompetent lenders. The poor business-
man does not get one nickel's worth of a break because this is on a pooled cost recovery basis to the government.
I cannot understand the logic. That is why the Reform Party says that a dollar in the hands of an investor, a businessman, an entrepreneur, a consumer, is far, far better than a dollar in the hands of a bureaucrat. The amendments to this act are living proof of the justification of Reform Party policy.
I cannot understand the government which talks about creating jobs, jobs, jobs. I recall that was its slogan during the election. The Liberals were going to spend $6 billion on the infrastructure program. Let us take the money, channel it through bureaucrats, lend it out or give it away to try and create jobs. It did not work.
The President of the Treasury Board appeared before the government operations committee trying to justify the infrastructure program. After spending $6 billion, by his own admission he has created 8,000 permanent jobs. That works out to $875,000 per job. He would have been far better off putting the money in the bank, taking the interest and giving it to the people, saying: "Do not bother going to work" because they would have had a lot more money. Ten per cent on $750,000 is $75,000 a year just by writing a cheque.
This type of policy is no good. It is not going to generate economic growth. It is not going to do anything for the lender. It is not going to make the lender more willing to give money to the small businessman. It is not going to make the small businessman accept any more risk because the successful small businessman is now going to end up paying an insurance premium through the lender into the government's pocket so it can bail out the guy who does not make it. That is just another tax on the competent and the successful small businessman who is trying to create jobs, pick the country up and generate some economic growth so we have a chance of digging ourselves out of the economic morass that the Liberal government and the Tory government have put us into.
The government talks about moving from this House and into cabinet the opportunity to make regulations. This is an affront to the powers of this House. We have seen a continuous and continual erosion of the powers we have in this House being passed over to the executive, to cabinet. Pretty soon the House will be an irrelevant debating society where we talk about these bills but have absolutely no control whatsoever over them.
If we approve this bill as it is being proposed, we are passing all the authority to cabinet. What good is that? When will the bill come back for public debate? When will we be able to find out that this bill is not working, that it is not creating jobs, except bureaucratic jobs? When? That is why this type of bill must be opposed at every opportunity.
As Reformers we believe in having accountability and responsibility. It is about time this Liberal government introduced some cost benefit analysis to tell us what in its opinion will be the outcome of the amendments it is proposing. How many jobs is it going to create in the civil service? How much is it going to cost the taxpayer? How many jobs will be created through this in the private sector? How much tax revenue will it produce? How many new jobs will it create in the small businesses that it intends to help?
Conversely, is this actually going to shut down jobs in the private sector? That is going to happen as we find it detracts from the motivation of small businessmen to borrow money through the Small Business Loans Act. The whole concept is recognizing that there are opportunities. A chance has to be taken. A risk has to be taken.
That risk is going to be avoided because the government says it does not have the money any more. It is going to skim the money off the successful entrepreneurs, channel it through the lenders back to use as write-offs on the bad loans and bad decisions. That is a dreadful decision.
In the last decade small business has accounted for the largest share of the net new job creation in the country. It employs almost half the labour force. Small businesses create eight out of every ten new jobs in Canada. They do it because of entrepreneurial spirit, not channelling money through the bureaucracy back out in some complex formula that Liberal members want to bring into cabinet so they can change and modify it if they so desire.
Give entrepreneurs freedom from rules and regulations. Give them freedom from red tape. Let them go out there and create jobs. By giving them the motivation and incentive to do so, unemployment will come down. New jobs will be created. Additional taxes will be paid without any tax increase. The deficit will come down. Our competitiveness will improve on the international stage. We will have all these things by getting the government out of the lives of small businessmen and women and not into it more at their expense.
The Department of Public Works and Government Services has found that small companies accounted for 79 per cent of the suppliers to the federal government in 1993-94 fiscal year. At least we are glad to see that the federal government recognizes that small business provides products that compete with the best in the world and are worth buying for the Government of Canada.
However, despite the excellent contribution small businesses make to the Canadian economy, the Liberals have not come through on their electoral promise to create a better environment for small business to work in.
I heard some comments from the other side of the House. I am sure they were not too complimentary on our position but I hope my remarks will cause them to think about the spirit of the bill. I would love to talk to them afterward and find out how they can see the logic and benefits in here.
These are the points I would like to make on this bill. I do not think that when it gets into committee and we hear witnesses-the banks that are going to be paying the fee to the government-that they will be complimentary. Some small businesses that use the program will be sceptical about why they should pay the premiums. Therefore, I hope the government will give some serious thought to redrafting the amendments to recognize that small business wants to provide the motivation.
I agree with the idea that the government should be involved in creating an environment for small business to create jobs. That is great. But the underlying philosophy here is that the government wants to be seen doing that but with the small businessman's money. On that point, I totally and absolutely disagree.