Mr. Speaker, I will take advantage of the opportunity afforded by the debate on Bill C-100 to draw the attention of this House to the inconsistencies and poor decision-making that undermine the very foundation of the federation.
I have had an opportunity during the past thirty years to observe, as many of us have, the evolution of Canadian federalism. A system based on certain relations between the federal government and the provinces, federalism has never been able to settle the issue of Quebec, Quebec which has the largest national minority in Canada. The Fathers of Confederation designed a system of government in which the provinces maintained a large measure of autonomy. In the twentieth century, two world wars, the emergence of the welfare state and the modernization of institutions as part of today's worldwide trend towards globalization gave the central government a chance to intervene increasingly in the administration of the provinces.
This normal development in a country whose geography was continental in size was never well received by the Quebec government which, for most French Canadians and later Quebecers, had always come first. Any attempt or decision made by the government in Ottawa to improve the way this country was governed has always been perceived by successive governments in Quebec as an encroachment on the prerogatives of the Quebec National Assembly.
The sovereignty plus partnership proposal of Quebec sovereignists constitutes the only concrete and realistic initiative to get out of the vicious circle that has poisoned the existence of this beautiful and great country that is Canada. Yes, Canada is an exceptional country. Although the current state of its public finances has prevented it from developing its full potential, this is due to the legacy left by former Prime Minister Trudeau and to the inept financial management of the present Prime Minister who was then Minister of Finance.
Under his stewardship, the deficit rose to $10.4 billion in 1977-78 and to $12.6 billion in 1978-79. For the first time, the annual deficit exceeded the 10 billion dollar mark, before spiralling completely out of control during the years that followed. In power for far too long and instructed by English Canada to deal with the Quebec problem, Pierre Trudeau believed he could unite the country by wooing voters with wall to wall social programs. He temporarily reduced certain disparities which today reappear with a vengeance as a result of the debt left us by the former Prime Minister.
Yes, Canada is an exceptional country, and the only way to deal with the crisis in our public finances, with useless administrative overlap and internal constitutional bickering, is to create a new economic and political partnership between Quebec and Canada, with a sovereign Quebec engaging in continuing negotiations between two sovereign and equal states. Yes, Canada is an exceptional country, but as Quebecers, we want our own country.
We know Quebec will also be an exceptional country and will be Canada's first global partner. Canada will be an even better country, once it has stopped the bickering and useless power struggles with a sovereign Quebec that will maintain special ties with Canada, based on equality and friendship.
Instead of supporting this view of relations between modern states, instead of supporting the proposals for renewal and change which the Prime Minister promised us during the last days of the referendum campaign in Quebec, the government proposes Bill C-100 on financial institutions, after tabling C-76 in which Ottawa assumed the power to impose national standards on social programs. Ottawa made another attempt at centralization with Bill C-88, to implement the agreement on internal trade, an agreement that would allow the government to act as the ultimate arbiter in interprovincial disputes.
The federal government and Quebec are going to be at each other's throat over regional development. Under Bill C-91, Ottawa will also be able to sign agreements with local authorities directly, without regard for provincial governments or existing regional structures.
All these legislative efforts aimed at centralization and at building a modern country could be meaningful and have some implication, if Quebec's situation were settled once and for all. Canada could blithely carry on with its efforts at economic modernization and streamlining the administration of its structures, if Quebec's situation were settled through the sovereignty-partnership arrangement we sovereignists are proposing to Quebecers. Ottawa will always be too centralizing for most Quebecers, whereas the majority of Canadians believe, quite legitimately, honestly and proudly in a strong central government.
In the meantime, no attempt can really reform Canadian federalism without the resolution of the Quebec-Canada issue, through the emergence of a sovereign Quebec that would keep close ties with its Canadian partner.
Instead, the Liberal government is proposing Bill C-100, which simply fuels the flames of federal-provincial relations. Let us have a closer look at the implications of this bill for Quebec's financial institutions.
Bill C-100 is very clear. It enables the federal government to take action faster when a financial institution is in difficulty. It also aims to reduce the risks inherent in Canada's financial system.
Under clause 6 of Schedule I, which establishes a Canadian clearing system, the Governor of the Bank of Canada reserves the right to issue directives, not only to clearing houses but to financial institutions as well, regardless of their charter. So, for example, Bill C-100 would allow the Governor of the Bank of Canada to issue directives and orders to institutions that are institutions of Quebec essentially, such as: Fiducie Desjardins, the Fonds de solidarité des travailleurs du Québec or the Lévesque Beaubien Geoffrion brokerage firm, to name but a few.
The Superintendent of Financial Institutions and of the Winding-up Act will be given more powers and will be able to intervene directly with provincial charter institutions.
The increased options available to the federal Superintendent of Financial Institutions will mean costly duplication and inefficient management of savings. The Inspecteur général des institutions financières du Québec already monitors the situation in this regard so that the federal superintendent's new powers will simply duplicate those that already exist.
The federal superintendent's broader powers may prompt Ottawa and Quebec City to issue court challenges that will leave struggling financial institutions and their depositors in the lurch.
Bill C-100 shows that the federal government is more concerned about assuming new powers than about ensuring the viability of financial institutions and protecting savings.
Bill C-100 will make major changes to the deposit insurance system in Canada. To become members, financial institutions now pay premiums based on deposit liabilities. The bill provides that the premiums will no longer be based on the financial institution's deposit liabilities but on its level or degree of risk. This raises many questions. For example, what criteria will be used to determine a financial institution's risk rating? The federal government now refuses to make public the regulations that will set risk ratings.
What will be the impact of federal risk ratings on financial institutions? No one knows.
Basing premium amounts on risk levels may penalize Quebec financial institutions particularly because they are relatively small. Since large corporations are generally seen as less risky and since Quebec has its own deposit insurance scheme, in which premiums are not based on risk levels as such, we will end up with two systems: one based on risk and the other on deposit liabilities, with all the inconsistencies and contradictions that this entails.
Bill C-100 shows once again Ottawa's determination to centralize activities. By establishing Canada-wide clearing and settlement systems, this bill encroaches on powers exercised by the Quebec securities commission and the Quebec inspector general of financial institutions.
All this results in costly overlap. Financial institutions will be subject to two levels of control, a situation which will result in unnecessary administrative duplication.
As I already mentioned, in addition to Bill C-100, the government has tabled three other centralizing pieces of legislation since the last federal budget, namely Bill C-76, Bill C-88 and Bill C-91. The centralization exercise is continuing as strongly as ever.
A 1991 Treasury Board study showed that 67 per cent of federal programs overlap provincial ones. With Bill C-100, Ottawa keeps heading in the same direction, towards a dead end. According to Julien and Proulx, from the University of Montreal, close to 1,000 meetings take place every year between Ottawa and Quebec public servants, simply to harmonize program objectives, or to ensure that provincial and federal programs are not incompatible with one another. Bill C-100 will give all these public servants another opportunity to meet, simply to try to harmonize the criteria used to determine premiums paid by financial institutions.
Pierre Fortin, who is an economist, estimates that three billion dollars is wasted annually because of overlapping Quebec and federal programs. Such overlap results in unnecessary costs for taxpayers, businesses and citizens. These costs have an impact on the debt and, in the end, jeopardize institutions which were set up to support our country's blueprint for society. From that perspective, Bill C-100 is nothing but an ill-considered attempt by this government to centralize, under the pretence of protecting investors, when the system in Quebec works very well.
This bill is also an unacceptable intrusion into the securities industry, when the private sector and major business associations already complain about excessive government involvement. Such abusive interference always results in lower productivity and in a shortfall, this at a time when there is an urgent need to improve the sad state of public finances. Instead of withdrawing and concentrating on the essential, as it should, given its chronic state of indebtedness, the federal government is increasingly interfering in fields of provincial jurisdiction, as well as in the activities of our businesses.
In Quebec, the various governments which have been in office over the last 30 years have all strongly defended Quebec's jurisdiction over the securities industry. Even Daniel Johnson reaffirmed that position in February 1994, when he was Quebec's
premier. The authority given to the Governor of the Bank of Canada to issue directives or orders to participants goes squarely against that traditional Quebec position, which was upheld even by provincial Liberals, which is quite something. As in the case of manpower training, there is a strong consensus in Quebec regarding this issue.
Consequently, the official opposition cannot support Bill C-100 on financial institutions, because it maintains a situation which, for more than 25 years now, has led to disputes which have drained the country and put it into debt. In order to end the current financial crisis, the federal government must stop getting involved in the activities of businesses. Similarly, in order to end the current constitutional crisis, Ottawa must stop getting involved in fields of provincial jurisdiction and let Quebec take charge of its own destiny. Unfortunately, this is just the opposite of what is proposed in Bill C-100, which is yet another stage in the exercise conducted by a centralizing government which is out of step with current events.