Debates of Nov. 2nd, 1995

The House resumed from November 1, 1995, consideration of the motion that Bill C-88, an Act to implement the Agreement on Internal Trade, be read the second time and referred to a committee.

Agreement On Internal Trade Implementation Act

[The Acting Speaker (Mrs. Maheu)]

When the House last considered Bill C-88, the hon. member for Joliette had 11 minutes left.

[René Laurin, Bloc, Joliette, QC]

Madam Speaker, when I had to break off my speech yesterday to let the House proceed with the Orders of the Day, I was discussing the actual impact of Bill C-88 and, more particularly, clause 9 of the bill.

The wording of clause 9 allows for a very broad interpretation. For instance, the federal government would be able to intervene and impose retaliatory measures even when it is not a party to the dispute.

Although the Bloc Quebecois has always been in favour of free trade and, in fact, we cannot do otherwise but support this concept, when a clause like this one gives the federal government sweeping powers, we must object to adopting the bill as tabled, or at least to the wording of clause 9. In fact, this clause could lend itself to two very different interpretations.

One interpretation could result in the federal government's giving itself powers, because of its obligation under the agreement to have the option to impose retaliatory measures, in the event and only in the event it becomes an aggrieved party. We believe clause 9 does not provide this. In fact, the first part of clause 9 reads as follows:

(1) For the purpose of suspending benefits or imposing retaliatory measures of equivalent effect against a province pursuant to Article 1710 of the Agreement, the Governor in Council may, by order,-

So the federal government may intervene and impose a variety of measures, which I will not read in their entirety, but will simply summarize: suspend rights or privileges, modify the application of any federal law; extend the application of any federal law to a province or take any other measure it considers necessary.

As it stands, we could interpret the meaning. In the case where a party is found to be in the wrong, under the terms of article 1710 of the agreement, the federal government, whether it is a party to the dispute or not, will be entitled to impose retaliatory measures against the party in question. As we saw yesterday, the parties may be a province, the federal government or any third party with close ties to either the province or the federal government.

We also pointed out yesterday that, because of its spending power, the federal government was already meddling in many areas or activities that are strictly provincial in jurisdiction and already had considerable latitude because of the way the parties were defined. Because of the considerable latitude it already enjoys under the definition of "federal government", it would be superfluous to add more here and permit the federal government to intervene even when it is not an aggrieved party. We believe this interpretation is contrary to the intent of the agreement.

The agreement does not, in fact, provide that the federal government may impose retaliatory measures against an injuring party. It could do so only if it was recognized as an injured party in this dispute.

The second possible interpretation of this provision, and the one with which we might agree, is that if the federal government wanted to retaliate against a party at fault pursuant to article 1710 of the agreement, it could do so only as the injured party in the dispute.

If this is what this provision means, we might agree. However, since the wording may be ambiguous and leave room for interpretation, we would like to clarify this paragraph by amending it so that if the federal government is recognized as a party injured by a measure imposed by another party in violation of the agreement, the governor in council may, by order and pursuant to article 1710 of the agreement, take the measures as listed in clause 9. This is our first comment regarding clause 9.

Another point I wish to raise is that the range of retaliatory measures of which the federal government may avail itself pursuant to clause 9 of the bill is much too broad.

By giving itself the power to modify or suspend the application of any federal law with respect to the province, to extend the application of any federal law to the province, or to take any other measure deemed necessary, the federal government is granting itself inordinate retaliatory powers that may affect the entire population of a province. The problem is that the federal government's legislative power affects all Canadians and that it already imposes laws on the provinces. These powers are denied to the provinces and we think in this case that, once again, this article could allow the federal government to impose its will on the provinces.

The federal government's retaliatory powers should be strictly limited to the trade areas already defined in the agreement. So, if we agreed on these restrictions, the federal government could no longer retaliate in social areas and go after the Canada social transfer, for example.

For the Bloc Quebecois, this is another way of looking at this article, which we regard as very important.

Finally, I would like to point out another controversial aspect of this bill. Clause 14 of this bill deals with the powers of appointment.

The governor in council may, by order, appoint any person to fill any position that may be necessary or advisable, in the opinion of the governor in council, for carrying out the purposes of the agreement.

Again, as in many other areas, the Bloc Quebecois thinks that these appointments should be ratified by the House of Commons instead of simply requiring an order of the governor in council. As in the case of appointments to several important boards, which are ratified by the House of Commons, we feel that-in this case involving billions of dollars in interprovincial trade subject to this act, this agreement-it is very important that all appointments be made public and subject to some scrutiny by the House. In fact, we ask that these appointments be made or suggested by the governor, but that they be systematically ratified by the House of Commons.

Those are the three points I wanted to raise with respect to clause 9.

[Charlie Penson, Reform, Peace River, AB]

Madam Speaker, I am happy to rise today to speak about the so-called agreement in Bill C-88 on internal trade barriers.

This bill is a total sham and should never have been introduced in the House. It has nothing to add to internal trade that is not already in place in the BNA act. It does not even maintain the same standard. Let me quote from section 121 of the BNA act. This is what we had before: "All articles of growth, produce or manufacture of any one of the provinces shall be admitted free into each of the other provinces".

What do we have now under article 101 of this provincial trade agreement? It states that the objective of the agreement is to reduce and eliminate, to the extent possible, barriers to the free movement of goods and services.

Is that not somewhat less than section 121 of the BNA act which says shall be admitted free? Obviously it is. I am concerned that the bill is like a Hollywood movie set. It looks good on the outside but there is nothing behind it. There are no teeth in this agreement and I have good reason to say that.

I tested the bill. A company in my riding has a contract with CN Rail to move its workers from Grand Prairie, Alberta into the Dawson Creek area of B.C., some 60 miles away. What did the company find? It cannot get a permit to go into B.C. It is being restricted even though it has a contract to move its cabs into that area.

We decided to test the new internal trade agreement. We asked the Department of Industry and the Department of Foreign Affairs and International Trade to get involved to see what they could do to help this company resolve the problem. They can do absolutely nothing.

This so-called trade agreement is nothing. It is just a loose agreement of empty words. It certainly will not do anything to address the problem of internal trade barriers which cost Canada between $8 billion and $10 billion a year. We simply cannot afford these kinds of costs. We are in a very competitive global trading environment and we have to give our companies the ability to build some economies of scale here at home before they launch into international business.

Let us talk about international business for a moment. Canada has signed some very good trade agreements internationally. We have signed the new GATT agreement, the Uruguay round. We have signed the NAFTA and previous to that the Canada-U.S. free trade agreement. We have better international agreements for trade than we have agreements for trade between the provinces. It is absolutely ludicrous. To pretend that this bill addresses the problem is just misleading the Canadian public.

The European Economic Community is now 15 member countries. There are fewer barriers to trade between those 15 countries in the European Union than we have between the provinces. Some decentralized federation. We need a workable agreement between the provinces and the federal government has to show leadership. That is what it involves. It must show leadership and broker the kind of agreement that is necessary. Obviously Bill C-88 does not do that.

Whole segments of the economy are not addressed in this bill. It does not include agriculture. It does not include certain government procurements or regional development. Those are all very significant barriers to trade.

A good example of how silly the trade gets within this country and the barriers we meet can be told in one simple example. A trucking company in Alberta had a gravel contract nine miles from the British Columbia border. It was working well within the province of Alberta, but at the end of the day the drivers wanted to drive their trucks into the nearest town to stay overnight in a hotel and eat in the restaurants. They were not allowed to do so. Why not? Because their trucks did not meet the requirements for the regulations in British Columbia. They had to have different axle spacings, an empty truck, certain permits they could not get without considerable expense. They had to bring in a special vehicle to take the workers into British Columbia to the hotel. That is how ludicrous this gets.

I suggest this is the type of situation there was in Russia some 10 years ago under communism. Surely we have to move beyond that if we are going to be effective in the world economy.

Nothing has been resolved in the area of natural resources and energy, all key areas of trade in Canada. The cost is estimated to be $8 billion per year. We cannot afford those costs. We must have a government that shows leadership and we certainly did not get it here.

The Prime Minister said that this was a modest proposal. Modest indeed. Most Canadians would see it as a complete waste of time and money. I am appalled that the Minister of Industry would bring this forward in the guise of a bill that is going to address the problems of trade restrictions.

I would ask him to go back to the drawing board. Bring the provincial premiers together. Bring the industry players together and show them what is the cost to our society. Show them what is the cost to their own industry. We can do much better. I challenge this minister to do so.

[The Acting Speaker (Mrs. Maheu)]

I would like to remind the House that we are now at the ten minute speech stage, with no question or comment period.

[Jean H. Leroux, Bloc, Shefford, QC]

Madam Speaker, first of all, I would like to pay tribute to the people of my riding who have voted yes in the referendum, in a proportion of 52.7 per cent, in the provincial part of Shefford as well as in the Iberville part. In the riding of Iberville, 56 per cent of voters said yes.

From the outset, you should know that I intend to continue sitting in this House for the duration of my mandate as a member of Parliament for the Bloc Quebecois.

This morning, I rise to speak on Bill C-88, an act to implement the Agreement on Internal Trade. As you know, Quebec-and Quebec members elected to this place in 1988-is responsible for the passage of the Free Trade Agreement. Had it not been for Quebec and its voters, Canada would have had a much harder time entering into this agreement between Canada and the United States that has greatly benefited both countries.

Quebec is a state which is open to the world. At present, and this is very sad, it is easier for Quebec to trade with the U.S. than with the rest of Canada because there was no legislation like this, and that made interprovincial trade extremely difficult. As the Minister of Commerce indicated, the difficulty came from the fact that Canadian laws dated back to the 1940s and that there was an unwillingness to evolve.

As I said a moment ago, Quebec trades mainly abroad, with the United States of America becoming our main trading partner. We also trade with the rest of Canada, although less and less as time goes by, and our trade relations with the rest of Canada or our provincial partners are also important.

Bill C-88 will normalize a situation that did not exist before. Take clause 9 of the bill for instance, which we have a problem with. It reads:

For the purpose of suspending benefits or imposing retaliatory measures of equivalent effect against a province pursuant to Article 1710 of the Agreement,

made between the provinces

the Governor in Council may, by order, do any one or more of the following:

The fault we find with this bill is that, once again, the federal government is taking pride of place. In the context of federal-provincial relations, Canada has always taken pride of place and retained the right of disallowance. In this case, penalties could even be imposed instead of deferring to an arbitral tribunal, as would normally be the case between states or provinces.

We totally disagree with Ottawa giving itself the kind of power this legislation would afford it. As I said earlier, Quebec has always been in favour of interprovincial trade in Canada.

What I cannot understand is why Canada manages its internal trade the way GATT managed international trade in the late 1940s. Mr. Manley himself, the current trade and commerce minister of Canada, said so.

The important thing to remember is that, in clause 9 of this bill, the government gives itself a power to disallow and punish. We also object to clause 14, which reads as follows:

1. (1) The Governor in Council may, by order, appoint any person to fill any position that may be necessary or advisable, in the opinion of the Governor in Council, for carrying out the purposes of the Agreement.

This provision means that, once again, Parliament will not have a say regarding these appointments. The Liberals always talk about reforms. They always say that they want to change the system. Yet, when they introduce bills, we realize that this is impossible, that the system cannot be changed and that there will not be any reform.

Once again, the governor in council has the privilege of making appointments, without asking for Parliament's approval. Sometimes, we wonder what we, elected representatives of the people and regions of Canada, are doing here. We meet in this House as representatives of the people and that, as you know, is a costly process. However, when the time comes for the government to place its confidence in our assembly and seek its approval, that government bypasses the whole parliamentary process and makes appointments through orders in council or departmental orders.

If Canada is considering reforms, it must correct that situation and give much more power to this Parliament. Canadians and Quebecers are not stupid, you know. They are increasingly aware of the fact that we do not make many decisions here; we just talk. Everything is already decided, and this is what I strongly object to. Reform members also denounce that situation, and this is to their credit, even though we may disagree on what needs to be done. We happen to think that we are a different country. We feel that the chaotic situation in Canada could be corrected by making some constitutional changes.

The ball is now in the court of the people opposite. What will they do? Probably nothing. We will wait and see. We expect that futile discussions will go on for the next 30 years, but I have to say that we do not intend to stick around very long.

In conclusion, this bill provides once again the federal government with the power to act alone and not consult the provinces, something which is unacceptable. It is unacceptable because, in a partnership-as trade relations should be-one side cannot give itself the power to control everything.

Federalism will once again create difficult situations. This bill will probably be passed without amendments, like several other ones, thanks to the Liberal majority. By staying within the Canadian federation, Quebec will have to suffer the consequences of that legislation, which will increase the power of the federal government, at the expense of the provinces.

[Ian McClelland, Reform, Edmonton Southwest, AB]

Madam Speaker, here it is at least a year after the legislation was introduced. It wends its way through the labyrinth of our political process and finally finds itself back on the floor of the House of Commons.

I thought I would be speaking to the bill yesterday so I thumbed through November 1 in history. Of course today is November 2. Interestingly Michelangelo completed his work on the Sistine Chapel, but it only took him four and a half years. The legislation is progressing apace, but no one will compare it with Michelangelo's work on the Sistine Chapel.

Actually to many observers it looks like a make work project. Anyone who has given the matter even a modicum of thought understands and appreciates how ludicrous it is in our country, united from sea to sea to sea, that it is more difficult to trade internally than it is to trade with any other trading partner we may have in the United States or elsewhere in the world.

When the legislation was being put together and the debate among provincial trade delegations was taking place, more people were sitting around the table trying to break down the barriers of interprovincial trade in our country than there were sitting around the table when we were trying to break down the trade barriers with the United States and to shape the North American Free Trade Agreement.

We had a situation where we were hopefully to have a North American Free Trade Agreement between Canada, the United States and Mexico and there were less people sitting at the table than when we were trying to break down internal trade barriers within Canada.

How did we end up in that situation? How is that our country ends up in a situation like that? Just a moment ago my hon. colleague from the Bloc spoke. I have had the pleasure of spending many hours in committee with the member listening to him defend the unilateral interests of Quebec. I have never once, in the two years that we have been here, heard him mutter one word about the rights, the interests or the values of Canada as a nation. Every word that has come out of the hon. member's mouth and the mouths of all members of the Bloc has been directly related to Quebec, how they can better the interests of Quebec.

The precise reason we have a problem in interprovincial trade in our country is that we have a kind of parochialism about our institutions. It is one of the primary reasons there is so much discontent from coast to coast to coast. For years citizens of Canada resident in the regions of Canada on the east coast, the west coast, the prairies and the north were merely markets for the manufacturing centres of central Canada in Montreal and southern Ontario.

We now have an opportunity to break down trade barriers within Canada, which would greatly strengthen the economic prospects of all regions of the country, including the manufacturing heartland of Ontario and Quebec. And what happens? We get around a table to debate the opportunity to make our country better.

Canadians spent $1.5 million or so to have Professor Michael Porter of the Harvard Business School do a study on Canada's competitive situation in the world. Interested viewers may know the same study or a study very similar to it could have been obtained for $2,000 U.S. from the Harvard Business School video series. It is exactly the same; it is on competitive strategies.

In any event this $1.5 million study has a recommendation at page 98: "Extend efforts to increase rivalry". It is a well known fact that to get a better product at a lower price we need competitive situations; we need rivalry. Professor Porter in his study asked how we were to be competitive internationally if we were not first competitive at home. How are we to be competitive at home if we have trade barriers that restrict competitiveness? It just makes sense.

This reminds me of the situation we found ourselves in when we entered into the free trade agreement with the United States which

members opposite, I would remind them, fought so vigorously. By and large members on this side and I were very much in favour of it.

[An hon. member]

They are born again.

[Ian McClelland, Reform, Edmonton Southwest, AB]

My colleague says that the Liberals are born again. They are learning. Here they are in government embracing the free trade agreement for the good of all. We are glad to see they have learned the error of their ways.

How is it that we entered into a free trade agreement with the United States, the most aggressive, strongest trading nation in the world, and had not first broken down the internal trade barriers in Canada? It is like getting into a fight with the biggest person in the school yard and saying: "I am going to fight fair. I am going to tie one hand behind my back just to make it fair for you because you are so big. Oh, by the way, just in case you think I might whip you, even though I have one hand tied behind my back, we will have the highest interest rates we have ever had, a high dollar, and we will fight with you in a free trade environment".

It was kind of like a Monty Python skit with the knight that had a head and a torso but no arms or legs. He had the knife in his teeth and was saying: "Fight fair, fight fair. I can beat you". That is what we did. We prostrated ourselves by having high interest rates and by having a high dollar, but most of all we had not broken down trade barriers within Canada so that we would be more efficient before getting into the free trade arena, the global trade arena in the world we find ourselves in. It is absolutely essential the trade barriers be broken down.

This speaks to the nub of the reason we are not supporting the legislation. People would ask: "How on earth can the member speak so positively about the necessity, the absolute need to break down trade barriers, and yet they will vote against the bill?" The reason is that the government has the responsibility to provide leadership and to make sure we actually break down trade barriers.

We get together with the provinces and have months and months of gumming this thing. Nothing happens. The disparity between the provinces in the way they approach the issue is enormous. The fault honestly should not be laid totally at the feet of the government because the provincial governments are involved as well. When the Alberta government came to the table to negotiate the free trade agreement it had one page with one line on it, that there should be no barriers to free trade in Canada. Our neighbouring provinces, Saskatchewan and British Columbia, came to the same meeting with a large stack to protect this, that and the other thing. Ontario, as I am told, made significant concessions. Quebec had to protect everything including the dairy industry and everything else it had.

This is where leadership comes into play, but the federal Liberal government did not lead. Its mandate is to keep people at the table to ensure laws are made to best accommodate the necessities of our country in the future.

In conclusion I will point out what leadership is all about. The Liberals will look at this era in history and hope that the writers and history will look kindly at them. They will look kindly at them if they seize the opportunity to make history, not to be carried along by events and overtaken by them.

[John Maloney, Liberal, Erie, ON]

Madam Speaker, I am pleased to have the opportunity this morning to speak to Bill C-88, an act to implement the agreement on internal trade.

The piece of legislation is historic. With it we will be implementing within the federal jurisdiction the obligations of the federal government under the first comprehensive domestic trade agreement in Canada since the British North America Act, 1867.

In the 128 years since 1867 the Canadian economy has grown and evolved in ways never imagined by the Fathers of Confederation. The federal government still has under section 91(a) of the Constitution responsibility for trade and commerce and specifically interprovincial trade.

Since 1867 the world has changed significantly. The provinces have assumed prominent roles as influencers of economic growth and the regulation of trade and commerce within their respective territories. As a result, trading arrangements and regulations have developed in an ad hoc way often in response to a particular regional need.

Many of those measures have, often unwittingly, created barriers to trade as the impact on the free flow of goods, services, people and capital within Canada. Such barriers can lead to the inefficient use of resources and limit the ability of industry to take advantage of the economies of scale and to maintain competitive market positions. The result has often been to reduce the competitiveness of Canadian business and to adversely affect the Canadian economy.

There have been many examples of such impediments: different professional and occupational standards in different jurisdictions which limit labour and mobility between provinces; selective listing policies by some provincial liquor boards that discriminate against products from outside their provinces; different transportation regulations, safety codes, inspection arrangements and vehicle standards in each province which make it difficult for truckers to cross provincial boundaries; government procurement polices that give preference to local companies; provincial incentive programs for industry development; and construction procedures that differ from jurisdiction to jurisdiction. These are some of the more

common examples of barriers and impediments to interprovincial trade and commerce as exist in Canada.

A recognition that the patchwork of regulations, standards and other barriers to interprovincial trade which have grown around us was an unacceptable feature of the domestic market in Canada. It led governments to agree to negotiate the agreement on internal trade. Growing concern and evidence that these barriers to trade seriously affected our ability to remain competitive in the international trading environment fuelled the urgency of establishing a new trade regime in Canada: one based on more interprovincial trade; one that would not impede the movement of people and investment within the country; and one that would allow for co-operative approaches to the resolution of domestic trade disputes.

Bill C-88 represents the federal government playing its part in doing just that. This bill establishes the framework that will allow us to continue to work to create a trading regime that will remove barriers to interprovincial trade in goods and services; that will reduce impediments to the movement of workers and investment capital between provinces; and that will provide a forum for the resolution of individual trade disputes without resorting to the courts.

The process leading up to this bill has been a long one. It has involved many people and considered many issues and perspectives. In addition to the federal, provincial and territorial governments at both the ministerial and official levels, representatives of the private sector have been actively involved in the process.

Representatives of the private sector and of business interests in particular, have kept the pressure on us at all levels of government to deal with the problems of interprovincial trade barriers and the consequential economic costs to Canada. The Canadian Manufacturers Association has estimated that barriers to trade in our domestic market cost the Canadian economy over $7 billion annually in job and income loss.

There has been a long and thorough process under way to identify problem areas and to develop practical, workable solutions. A key characteristic of the process has been the spirit of co-operation which all the parties involved have demonstrated. In fact, the agreement on internal free trade is an outstanding example of what can be accomplished within a co-operative framework in Canada.

It is also important to note that political parties of all stripes and all regional perspectives have been part of the process.

One fundamental point agreed on by all the parties in the negotiation process is a recognition that a more open trading environment will be good for Canada.

While the process was of long duration, it was characterized by co-operation and a sense of shared mission. The agreement represents a major step toward our shared objective of improving the domestic trading environment and to eliminating barriers to trade, investment and labour mobility in Canada.

The agreement on internal trade provides for the following: a rules based system for trade within Canada; a dispute settlement mechanism to resolve issues on internal trade matters; a standstill on new barriers; commitments to future negotiations to broaden and deepen the agreement; a code of conduct to prevent destructive competition from investment; increased labour mobility; and a commitment to reconcile standards related measures. These are significant achievements.

A key part of this agreement, indeed a key part of any trade agreement, is in how it resolves disputes. This agreement represents a unique solution to our unique Canadian circumstances. It has a made in Canada solution and it provides the basis for promoting compliance through consultation and co-operation rather than by resorting to more formal court based procedures. It is built on rules that draw on established concepts in the international trading environment, but has been refined for use in a Canadian context.

In the international trading environment there are several examples of accords and agreements which set out rules for trading between nations. There are many, many different models for settling disputes and achieving compliance. Well known examples include the General Agreement on Tariffs and Trade, commonly known as GATT, and now the new World Trade Organization, the WTO, the European Union and the North American Free Trade Agreement.

There have been suggestions that we in Canada should just use one or another of these models in the Canadian situation. These suggestions overlook the important issue of the sovereignty of the parties to an agreement, as well as the degree of political control that the parties themselves are willing to give up to a compliance mechanism.

In the case of the European Union for example, the central authority is supreme over that of the individual member countries. The European Union accord is a comprehensive agreement which gives the central governing authority the overriding power to propose and enact legislation that applies to all parties. That system is based on a legislative and judicial framework, so that a business firm or an individual who feels aggrieved by an action under the law of a particular nation can bring the case to the European Union council as the supreme authority.

Thus the parties to the European Union agreement have relinquished their sovereign authority in particular areas of trade law, competition policy and government support for industry and have agreed to accept a formal dispute settlement mechanism with the power to enforce decisions. If we applied this model to Canada, it would mean that the federal government would exercise authority over all the other jurisdictions. I wonder if those who recommend the European model are aware of that.

The General Agreement on Tariffs and Trade, GATT, offers a different model. Under GATT, member nations do not relinquish sovereign authority and disputes are brought forward by a sovereign government representing its national interest. Disputes are referred to an ad hoc panel that can recommend that a trade policy or course of action be changed, but the recommendation cannot be enforced in law. Thus parties to GATT retain their sovereign right to enact and enforce laws within their own country, but do not have recourse to an enforcement mechanism to change non-compliant behaviour outside their own boundaries.

The North American Free Trade Agreement is closer to the GATT model in that sovereignty remains within the national government of each state and disputes are brought forward by governments to the NAFTA commission, which is made up of the responsible ministers of each country who will set up a panel to consider specific disputes.

Whereas parties to the NAFTA retain sovereign authority with respect to enacting and enforcing national legislation, they have agreed to accept the authority of the NAFTA commission to administer retaliatory measures on behalf of aggrieved parties as enforceable sanctions. Thus, under NAFTA, parties remain sovereign states but have effectively ceded some of their sovereignty.

While all of these models have useful elements, none was applicable to the Canadian situation.

The internal trade agreement created a committee on internal trade to oversee its implementation and continuing operation. All governments who are party to the agreement, that is the federal, provincial and territorial governments, are members of the committee.

The committee will be supported by a secretariat which is to provide administrative and operational services. Part of the mandate of the committee is to assist in the resolution of disputes arising out of interpretations and applications of the agreement.

The working philosophy of the committee and of the agreement is to use consultation and conciliation in dispute resolution. Disputing parties will be encouraged to make every attempt through co-operation, consultations and other forms of dispute resolution to arrive at a solution.

I would suggest that Bill C-88 should be supported by all members of this House. It is a progressive measure, a progressive law. It will be good for the country. It will be good for the constituents of Erie riding which I represent.

[Osvaldo Nunez, Bloc, Bourassa, QC]

Madam Speaker, I am speaking today on Bill C-88, an act to implement the agreement on internal trade.

As we are aware, the federal government must implement that agreement through Parliament. There are a number of points covered in this bill: the process for appointment of a federal representative to the Committee on Internal Trade; payment of the federal government's share of expenditures associated with operating the secretariat; the power of the governor in council to suspend, in special cases, the benefits granted under the agreement. Also, no private course of action may be taken based on the text or its implementing orders, nor the dispositions of the agreement, other than specific exceptions, without the consent of the Attorney General of Canada. Here are a few more: retaliatory powers where the federal government is an injured party; changes in certain federal legislative texts to bring them in line with the agreement, such as the Financial Administration Act, the Crown Liability and Proceedings Act, the Interest Act and the Motor Vehicle Transport Act.

The role of the Committee on Internal Trade is to supervise implementation of the agreement and to facilitate dispute settlement. This bill ensures equal treatment of individuals, goods and businesses, regardless of their origin within Canada. It harmonizes standards and regulations in order to eliminate certain practices which might present an obstacle to interprovincial trade. It calls for the free movement of individuals, goods and capital.

The eleven sectors covered by the agreement are public contracts, investments, labour mobility, consumer measures and standards, agrifood products, alcoholic beverages, natural resource processing, communications, transportation, energy, and environmental protection. These various sectors are affected to varying degrees.

Retaliatory measures may be taken by the injured party against the party does not comply with the agreement. A party may be a province, a territory or the federal government.

The main purpose of Bill C-88 is to implement the Agreement on Internal Trade. As other members of my party have already said, the Bloc Quebecois has always supported free trade, both internally and internationally. Consequently, we support the principle of this bill, and I must say I never understood why trade barriers existed between the various provinces in Canada.

I may point out that I object to the wording of clause 9 which provides that:

For the purpose of suspending benefits or imposing retaliatory measures of equivalent effect against a province pursuant to Article 1710 of the Agreement, the Governor in Council may, by order, do any one or more of the following:

It could be interpreted to mean that the federal government may intervene and impose retaliatory measures even when it is not a party to the dispute. Through this bill, Ottawa acquires a mechanism for imposing sanctions on the provinces. In fact, the federal government could impose all kinds of sanctions, including a reduction in transfer payments for provinces that do not abide by the agreement. This new intrusion by the federal government is unacceptable.

I said the Bloc Quebecois supports free trade both internally and internationally. I would like to comment briefly on NAFTA and continental free trade in the Americas.

At the summit meeting attended by presidents and government leaders in Miami, in December 1993, there was some discussion of this topic, and it was decided to expand NAFTA to include all countries in the three Americas in the largest free trade zone ever, from Alaska to Tierra del Fuego.

The first country to sign this free trade agreement after the United States, Canada and Mexico will be Chile, and I fully and strongly support the decision of Chile, my country of birth, to become a member of NAFTA. The Bloc Quebecois has done so as well. Everything was in place for Chile to become a member of NAFTA on January 1, 1996, but unfortunately, the fast-track legislation was not passed by the U.S. Congress, and there will be no quick negotiations as planned. It will take several months more before Chile can sign this agreement.

I would also like to say that, although I am in favour of free trade zones, including NAFTA, I am very critical of the agreement, especially its lack of a social dimension, although a parallel agreement on labour was adopted and a secretariat is starting to operate in Texas with officials from all three countries. Last March, I attended a conference in San Juan, Puerto Rico, to discuss the social aspects of NAFTA with participants from Mexico, Puerto Rico, the United States, Canada and Quebec. We noticed, as I do now, that unfortunately there has been very little debate in this Parliament and in Canada as a whole on the impact of NAFTA on workers. I found that unions do not play a role at all in the operation and administration of NAFTA.

Having lived in Europe for a number of years, I am familiar with the European integration process. I found that Europeans had more social concerns. Their treaty, for example, contains provision for the creation of a special fund to assist workers affected by the European common market; a social charter, containing principles and provisions protecting workers, and an economic and social council where employers and workers may meet to discuss European integration.

Unfortunately, NAFTA contains no provision for minimum working standards, except in three areas: minimum standards must be met in health and safety on the job, child labour is prohibited, and each country in NAFTA must comply with its minimum salary legislation. No standards are set, however, for the three countries. There is no standardization in either social or labour terms. Provision could have been made for the inclusion of international labour standards in NAFTA, such as the convention on the right to unionize, unrestricted collective bargaining and the right of association. NAFTA contains no provision on the free movement of labour and nothing to protect immigrant workers. International free trade agreements must contain a social element, just as this social element must be included in free trade or common market agreements.

[George S. Rideout, Liberal, Parliamentary Secretary to Minister of Natural Resources]

Madam Speaker, the agreement on international trade came into effect on July 1. Bill C-88 is intended to make it possible for the federal government to comply fully with its obligations under the agreement. I therefore believe that it is important for the House to proceed expeditiously in its consideration of Bill C-88.

For years, business and private sector groups have complained to both the federal and provincial governments about domestic trade barriers and impediments to a free and open internal market. Numerous studies going back as far as the 1940 Rowell-Sirois commission have recognized the issue and documented the broad scope of the problem.

The Canadian Manufacturers' Association in 1991 estimated the cost associated with barriers and economic inefficiencies to be approximately $6.5 billion annually. The most recent Statistics Canada figures indicate that interprovincial exports of goods and services in 1990 were worth $141 billion annually and responsible directly or indirectly for 1.7 million jobs.

A recent study by the chamber of commerce underlined the fact that the Canadian internal market is the most interdependent of any area in the world. In agreeing to negotiate the agreement, Canadian governments recognized that how well our domestic economy works is key to how we will prosper as a nation and how we will compete in the international economy. An open domestic market and economy will allow Canadians and Canadian companies to strengthen their international competitiveness and develop new opportunities to grow and prosper. The alternative offers only an

ultimately self-destructive protectionism that benefits only a few special interests at the cost of the country as a whole.

When they agreed to negotiate the agreement on internal trade, the federal, provincial, and territorial governments all recognized and accepted the importance of working together in the national interest. In concluding the agreement, Canadian governments have demonstrated that they are prepared to work together, both now and in the future.

As the Minister of Industry has said in the House, the agreement is a consensual agreement. Some members opposite have criticized the agreement as inadequate and insufficient. The agreement may not be perfect, but it represents an improvement from where we were before. It reflects a consensus on the principle of an open and efficient national economy. It establishes a detailed rules framework for internal trade and it provides a consistent and defined process for preventing and resolving disputes that may arise over specific issues or measures.

All the parties have accepted to a greater or lesser degree disciplines that in the sectors covered will improve how the national economy functions in the future. It will be possible, indeed it is the government's intention, to work to improve the agreement in the future and to expand its scope and coverage. For the moment it is a start, a point from which to start to work. We can and we should build on that.

Some members have also criticized the government for not exercising its constitutional authority over interprovincial trade to open an internal market more forcibly. The national economy has become considerably more complex than it was when the constitutional powers of the different levels of governments were first agreed to in 1867. In the context of today's economy and modern Canadian federalism, the views of these critics are, frankly speaking, simplistic.

If anything is clear it is that a country operates most successfully when all levels of government work co-operatively in the national interest, not unilaterally and certainly not by fiat. Governments were not negotiating constitutional change in the agreement on internal trade. Rather, they were developing the basis of working together with their respective powers and responsibilities to make the national economy work more effectively and efficiently.

Unilateral action may be theoretically possible as a method to achieve the same ends. Some may consider it to be a desirable way of proceeding. However, it is simply not an effective or acceptable way to make Canadian federalism work.

Some members opposite have suggested that the government has a hidden agenda on Bill C-88, that it conceals a power grab and is intended to provide a means to force provinces to the will of the federal government. That is purely and simply wrong. The Minister of Industry has responded at length and in detail to those allegations. I will not dignify them with further comment. Those should preclude even the most obtuse interpretation of the bill's language.

Bill C-88 does not deal with the responsibilities of the provinces or provincial measures, only federal responsibilities and measures. It is intended only to make it possible for the federal government to comply fully with its obligations under the agreement and to play its part in making the agreement work.

Bill C-88 gives the government specific authority or makes changes to certain pieces of legislation to enable it to act in accordance with its obligations. It also changes some existing legislation to make it easier for provinces to comply with some of their specific obligations under the agreement.

The Minister of Industry has indicated in a response to his provincial counterparts and to Senator Roberge that he intends to propose one or two amendments to Bill C-88 when it is considered in committee. I expect those will remove the grounds for misinterpretation or misrepresentation that some have made of the government's intentions.

We should be clear in our understanding that Bill C-88 does not by itself legislate or give life to the agreement on internal trade. The agreement has already been signed by the parties-the federal, provincial, and territorial governments. When it came into effect July 1 all those governments became bound by the obligations they accepted when they signed the agreement.

Each government is responsible itself for complying with its obligations and for living up to its responsibilities under the agreement. At the annual premiers conference this summer the provincial premiers and territorial leaders renewed their commitment to the agreement and to removing barriers. Two provinces, Alberta and Newfoundland, have already passed their implementing legislation.

As I said earlier, I believe it is important that we on the federal side proceed expeditiously in our consideration of this legislation. The federal government has played a leading role in getting all governments to work together in the interests of all Canadians on international trade issues.

Bill C-88 does what is necessary to ensure the federal level of government will be able to continue to play its role in the co-operative intergovernmental process. We should not delay it further.

[Jean Augustine, Liberal, Parliamentary Secretary to Prime Minister]

Madam Speaker, I want to speak for a few minutes on Bill C-88 and look at some of the allegations that have been made in previous debates by some members about Bill C-88 and the

unwarranted concerns those allegations may have engendered in other quarters.

The opposition's allegations about Bill C-88 stem from an inability or an obstinate unwillingness to understand the plain meaning of the text of the bill. The Minister of Industry responded in detail to those allegations in this House in May and in June. I will refer to some of the points that need repeating.

Only in rare cases would the federal government be a complainant in a dispute under the agreement on internal trade. If a dispute were resolved in favour of the federal government and if the province involved refused to comply with the impartial panel's findings, the federal government could withdraw benefits of equivalent effect.

Such retaliation would have to be in the same sector as the original violation or in another sector covered by the agreement. Retaliation could not involve-and I think this is important-transfer payments or social programs because those things are not covered by the agreement.

Bill C-88 does not make the federal government the policeman of the agreement on internal trade, as the opposition mistakenly insists. Any careful reading of the headnotes to clause 9 of Bill C-88 and article 1710 of the agreement on internal trade, combined with a minimum of logical reasoning, immediately gainsays the wild allegations that have been made.

It is important to stress that Bill C-88 deals only with what the federal government must do to live up to its obligations under the internal trade agreement and nothing else. Notwithstanding the fact that the concerns expressed were totally unwarranted and clearly tactically motivated, the Minister of Industry has spent some time in committee and in other places speaking to the amendments in Bill C-88.

I will reaffirm the fact that to date, Alberta and Newfoundland have passed legislation to implement the agreement and to comply with their respective obligations under it. Since tabling Bill C-88 in the House on May 1, in the cold light of day the actual substance of the bill has proven to be uncontroversial and designed only to enable the federal government to comply with its obligations under the agreement on internal trade and to meet the negotiated commitments, both legal and moral, to the other parties to the agreement, that is, the provinces and the territories.

There is so much one can say in support of this bill. I want to stress the fact that this straightforward consideration of the bill has been more or less reaffirmed in the discussions and debates which have taken place. It is important to note the urgency of what we are asking now. The passing of Bill C-88 is important to underscore the federal part in ensuring the agreement is implemented.

This is a historic piece of legislation. It will allow the federal government to continue to play a lead role in concert with the governments of the other parties to the agreement. It is also intended to implement the first comprehensive domestic trade agreement in Canada since the British North America Act in 1867.

In the 128 years since 1867 the Canadian economy has grown and evolved in ways never imagined by the fathers of Confederation. The federal government still has constitutional responsibility for interprovincial trade and commerce, but successive governments as a matter of policy have chosen to work co-operatively with the provinces to address internal trade problems.

Barriers and impediments to internal trade lead to the inefficient use of resources. They limit the ability of industry to take advantages of economies of scale and to maintain competitive market positions. The result is to reduce the competitiveness of Canadian business and to adversely affect the Canadian economy.

It is incumbent on all Canadian governments to work together to make the national economy work as effectively and efficiently as possible so that all Canadians can enjoy the benefits of strong economic development, growth and prosperity. I call on all members to look at this straightforward legislation which will provide the needed facility as we work together to provide the kind of environment needed by our businesses.

We have sought to work co-operatively. The whole process which produced the agreement is testament to that. Our approach has been one which speaks to the fact that we are a truly responsible Canadian government. As a truly responsible Canadian government we can take those working arrangements between provinces into the future. I call on hon. members to give their support.

[The Acting Speaker (Mrs. Maheu)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Mrs. Maheu)]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Acting Speaker (Mrs. Maheu)]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Acting Speaker (Mrs. Maheu)]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker (Mrs. Maheu)]

In my opinion the yeas have it.

And more than five members having risen:

[The Acting Speaker (Mrs. Maheu)]

Call in the members.

And the bells having rung:

[The Acting Speaker (Mrs. Maheu)]

Pursuant to Standing Order 45(7), the chief government whip, with the agreement of the whips of all recognized parties, has requested that the division on the question now before the House be deferred until Monday at 6 p.m., at which time the bells to call in the members will be sounded for not more than 15 minutes.