Mr. Speaker, all laws passed by Parliament are designed to deal with inefficiencies and injustices created by free and voluntary interactions among people. Canada's Bankruptcy and Insolvency Act is no exception.
People dealing honestly and with the best of intentions borrow money from others in order to establish businesses or carry them over periods of temporary insolvency. In this world of uncertainty, occasionally the best made plans of borrowers go wrong. They are unable to meet the repayment schedules to which they have committed themselves.
Historically, creditors used to have powerful instruments of coercion to assure that debtors make every effort to repay their debts. The stories of debtor prisons are the stuff of Dickens' novels. They have done much to influence our thinking about the injustices involved in the old, harsh methods of dealing with debtors.
These attitudes are that debtors unable to pay their debts are in trouble for reasons beyond their control. They typically are poor and need to be protected from rich creditors. Moreover, it is not in the interests of society that individuals who have hit a streak of bad luck should be stigmatized for life and forever unable to get back into business or even just mainstream life. The conditions described in Dickens' novels were that the poor were stripped of everything. They were stigmatized. Indeed those were bad times and some changes were needed.
The existing Bankruptcy and Insolvency Act reflects social attitudes. It makes it possible for individuals to declare bankruptcy to escape the social and economic penalties that historically were imposed on debtors. In Canada and in most industrialized countries today, debtors can clean the slate, walk away from past mistakes
and start all over again by the simple act of asking courts to declare them bankrupt.
Canadians believe generally that these rules are desirable and create a better society. They also believe that bankruptcy itself and the stigma attached to having declared bankruptcy are sufficient deterrents to abuse of the privileges granted under the law.
I might note that there are significant differences between countries. I understand that in the United States, some successful businessmen who today are millionaires brag about the fact that they have been bankrupt at least two or three times. One of the significant cultural differences in the United States, Canada and Europe is the fact that we typically do not have these kinds of entrepreneurs that go around saying it was quite all right to have been bankrupt a couple of times.