Mr. Speaker, in this debate concerning Bill C-100, once again we see the separatists grabbing at an opportunity to attack a Canadian bill, not because it is a poor one, but simply because it is one that would be good for Canada. In other words, if a bill is good for Canada, they are going to attack it.
What they have told us today is that Bill C-100 is an encroachment into provincial jurisdiction, in other words one more intrusion by the federal government. But that is not true in the least. What is it? This is not a bill aimed at regulating co-operatives in Quebec or elsewhere in Canada. It is a bill that will reaffirm the vital role played by the Bank of Canada in protecting all Canadians and all Canadian institutions against systemic risks that may originate anywhere in the world.
We have witnessed the collapse of Barings Bank, which could have caused many problems in our country. What we are proposing in this bill is to give the Bank of Canada the power to guarantee transactions between financial institutions, either in Canada or elsewhere.
This means that if a Canadian banking institution or even a credit union had received a cheque, say for $100 million drawn on Barings Bank and had deposited that cheque, but Barings Bank had gone bankrupt before the cheque cleared, while in the meantime, counting on the $100 million, the institution had paid some of its debts, that institution would have sustained a heavy loss.
What we need to do from the time a cheque is received by a Canadian institution, is to be sure that it can be counted on. But they do not want this. Why do they not want a system which would entitle all Canadian institutions to certainty when financial transactions are concerned?
The fact that the Bloc members are complaining about an intrusion in their constitutional domain is typical of what they will do with every bill we see in this House that is for the good of all Canadians, including Quebecers. They are going to try to find some way to knock it down so that they can say that Canada does not work. Their agenda is not the better working of Canada, it is the destruction of this very country. Canadians are not going to be fooled; Quebecers are not going to be fooled.
Let us get down to some of the essences of Bill C-100. Part of the genesis of it was the failure of Confederation Life which shook all Canadians. We had not expected it; a great financial institution went down.
The insurance industry put in place an institution called CompCorp where it contributes funds to protect the policyholders when there is a failure of an insurance institution. The government was concerned that perhaps there was not enough federal regulation in terms of CompCorp, that maybe some of the interests which we needed to have on the table, acting for all Canadians, were not going to be there.
The minister proposed a new type of institution using the insurance companies but also having a greater federal presence. The insurance industry came back to us and said it did not like our federal proposal, but it recognized that there were some improvements it had to make in the way CompCorp was run. The industry said it would make the changes in order to respect the needs of all Canadians.
This was a remarkable process. The minister put out a challenge and the industry responded on its own. The government is not involved in yet another program that could cost it funds, but the industry has assumed this responsibility in a way that will even strengthen the protection available to policyholders.
I commend the industry for coming up with this solution. It is the way we have to work. It was the spirit in which all of the measures in Bill C-100 were addressed.
One of the other issues which came before the committee was addressed by my colleague from the Reform Party. His party will not be supporting the bill because it believes we should not have Canadian deposit insurance which covers every last cent owed to a depositor up to $60,000. Reformers want a system of co-insurance so that if someone deposits funds in a financial institution which is regulated by the federal government, the depositor cannot be guaranteed 100 cents on the dollar to the first $60,000 he or she deposited.
There is a rationale for what the Reform members say and it does have some merit. The merit is that if I as an individual am responsible for part of the risk on that $60,000, I will be more prudent in selecting the institution in which I deposit my funds. I will investigate whether it is credit worthy. I will look around with due diligence before I make that deposit.
In theory that makes a lot of sense but in practice I wonder whether it would really work for the vast majority of Canadians. How many of them have the opportunity to investigate on their own whether a financial institution is really solvent, whether it is really solid, whether it is going to pay back their deposit within five years if it is a term deposit for that amount of time?
Can we really look five years down the road if we are making a term deposit, even if we have access to all of those financial documents? I am not really sure it is reasonable to expect everyone who deposits in a bank or a financial institution to do that, and most people do have deposits. Is it reasonable to expect all Canadians to undertake this with due diligence? Even if they do undertake it, is it reasonable to expect that they can look five years down the road when their deposit is to mature?
I like the idea of Canadians taking a greater role in looking at their returns and not just going for the highest return. If somebody is paying more than the going rate, perhaps there is a reason for it. Perhaps they are desperate for the funds and they will take them at any price. I suspect that what we have to do as a federal government is make sure through our federal institutions that the deposit taking institutions are solvent. Through the Superintendent of Insurance and other federal agencies we have undertaken that greater role of making sure those institutions to which we have given the privilege of taking deposits will hopefully be safe in the future.
This is why I believe it is important in order to protect the vast majority of individual Canadians that we continue to maintain the full level of deposit insurance. This does not mean we cannot look at this issue in the future and perhaps look at other ways in which we can achieve the same results.
I want to go back to the process by which we looked at Bill C-100 and how it evolved. It can serve as an example for other federal legislation.
The Secretary of State for Financial Institutions put out a white paper last spring. He gave the industry about three months to respond to it. The industry studied it and came back with its considerations. The minister took those considerations into mind when he introduced the bill which came down last spring.
The finance committee sat in the month of August and heard testimony on the bill. The committee did not wait for the House to give it this reference. The bill has not even achieved second reading yet. It had just been tabled in June but we thought it important to get feedback from the industry again.
The finance committee held two very intensive days of hearings here in August. About 15 recommendations for modifications to the bill were made. The industry was very enthusiastic that we had accepted what it had proposed for CompCorp which was the major issue, to try to protect policyholders of our insurance companies in the future.
The industry came back with some concrete and constructive suggestions as to how Bill C-100 could be improved. We have noted those suggestions. The vast majority of the recommendations made at the hearings were very constructive.
We are now at the stage that even before the bill has been officially given to the committee by the House, we are looking at the recommendations made by industry. We are having discussions with officials, and we are continuing discussions with members of the industry. I am sure by the time the bill sees the light of day again it will have a number of constructive amendments attached to it. The amendments will not be arrived at through confrontation nor by saying: "Here it is; take it or leave it". It will be through the constructive, co-operative efforts of those of us here in Ottawa, of
the officials who are knowledgeable and of those from the industry who are concerned with achieving a proper legislative result.
I commend the minister for this approach. I commend the industry for the very constructive role it has taken. There is only one sour note we have seen in this whole bill.
It was when the committee sat during the month of August. The separatists tried to attack the bill on the grounds that it was a federal intrusion in a provincial jurisdiction. That was not the case at all. It would have been ultra vires for the federal government to do so.
What we did was give the Bank of Canada the power to provide better protection for all Canadian institutions, including the caisses in Quebec and all the co-ops and banks, against major risks, the systemic risks in the financial system as a whole.
The separatists themselves asked to keep the Canadian dollar. So would they prefer to ignore a better way to protect financial institutions and the dollar? Even if Quebec were an independent country, it would be necessary to protect the large value transfer system and prevent systemic risks.
However, they do not want it now and never will. We all know that the Bloc strategy, the separatist strategy is to attack us every time we do something good for all Canadians.