Mr. Speaker, it is an honour to rise in the House today and speak to second reading of Bill C-88, an act to implement the agreement on internal trade.
However, Bill C-88 is like Bill C-85 on pension reform, it has more fluff than substance. Unfortunately it is another failure to deal with a serious problem. It appears to be another broken promise made in the famous red ink book. The Reform Party will be opposing the bill as it is currently written because it would implement an agreement that from a federalist perspective may be a step backward in our already deplorable situation.
I would like to point out for the benefit of all members the problems this bill brings, some historical perspective and as always, the Reform alternative, what I believe can be an inexpensive, agreeable and efficient solution to our current problems.
We are all aware that Canada has a massive problem with the free flow of goods, services and capital within our borders. We are all aware of the hundreds of barriers that exist to trade between the provinces, the billions of dollars this costs the economy annually, the thousands of jobs that are lost to Canadians and the larger than necessary government deficits that continue to grow.
The Canadian Chamber of Commerce estimates that interprovincial trade barriers cost every Canadian family at least $1,000 a year. Others have estimated that the cost per family may be as high as $3,500 per year.
The chamber continues on to say: "These estimates do not capture the costs associated with new activity that is deterred as a result of the existence of barriers. For example, existence of internal barriers and the knowledge that new ones can be introduced at any time can deter Canadian businesses and entrepreneurs from undertaking new initiatives based on the expectation of access to the whole Canadian market. Similarly, the existence of internal barriers may discourage international investors who seek to locate their plants in fully integrated markets from bringing their productive investments to Canada".
There is no partisan issue in these considerations. We have all agreed, as did all the premiers last year, that these barriers to growth, productivity and employment must be reduced and eliminated. Even the current premier of Quebec has indicated his willingness to find agreement in these matters. Free trade within our borders is something every member of the House can agree to, except perhaps the NDP.
Where some of us differ is on the issue of the best mechanism to get there. The agreement signed last year between the provinces and Ottawa is a faulty mechanism that may do more damage than the good it intends.
A Globe and Mail editorial stated:
To say that the signing of the agreement on interprovincial trade barriers was a triumph of federalism would be an overstatement. To say that it will create a free market would be an illusion. To say that it will bring stability and unity would be optimism''. The editorial continues to talk about the status quo of barriers which will remain in place saying:These are the wages of parochialism and the country continues to pay them''.
What became perfectly clear at the outcome of the meeting was not that the agreement to trade freely had been brokered but rather that an excellent photo opportunity had been set up for one candidate in the Quebec provincial election. All news commentators made that point. All of them remarked on the shallowness of the deal and in the final analysis they were right. The deal was shallow and the photo opportunity was a bust. The Quebec candidate went on to lose the election.
Unfortunately Canadians have to suffer with the results. There is still no improvement in trade between the provinces. The unity question continues to burn. We believe that in the solution to our domestic trade problem we will also find the solution to our national unity problem. The trade ties that could be binding us together as Canadians are the trade walls which are currently keeping us apart. Reformers and the BQ agree on this point. The Liberals say they agree but their words have rung hollow so far.
A Liberal Party pollster summed it up well when he said: "The people on the street know this is no victory for federalism. They know the deal is full of loopholes. They know that Canada has successfully negotiated a sweeping free trade deal with the United States but is unable to do so within its own borders".
It is important to reflect on the statements that have come from the government recently with respect to free trade. For example, the finance minister estimated that the economy would grow by 0.4 per cent as a result of the implementation of the GATT agreement due to freer trade with other countries. On the other hand, estimates by the Fraser Institute on the effect of removing interprovincial trade barriers ranged from 2 per cent up to a possible 6 per cent growth in GDP.
In other words, with the Uruguay round of the GATT we spent seven years and millions of tax dollars to negotiate with 120 foreign countries to open up trade and yet we have an opportunity to realize five to fifteen times the economic benefit by legislating, negotiating and arbitrating among only ten provinces. Unfortunately, the government has given only a half-hearted effort so far.
The Minister for International Trade in speaking to the GATT implementation bill stated: "The agreement includes an enormous package of national commitments to lower tariffs and non-tariff barriers to merchandise trade". It sounds wonderful but where are the complementary commitments we need to increase interprovincial trade?
The Prime Minister stated during the first ministers' conference that thousands of new jobs would be created and it would benefit all Canadians regardless of region. Unfortunately the talk we have heard bears little resemblance to the inaction we have seen in the flawed agreement. Let me explain where some of the flaws are.
The agreement sets out to eliminate specific barriers but may in fact create new ones and higher hurdles for business to cross. An example is the provision contained in article 709 which states that a province may adopt or maintain a measure that is inconsistent with the articles on labour mobility if the purpose of that measure is to achieve a legitimate objective.
The list of legitimate objectives is extensive. Any province wishing to maintain or erect a barrier need look no further than this list to find a suitable excuse. Included are: public security, safety and order; protection of human, animal or plant life and health; protection of the environment; consumer protection; affirmative action and so on.
In other words, labour mobility is restricted by the self-serving interests of any province through the articles contained in this agreement. Many would recognize this as the current status quo, but early on I said this may even be a step backwards. Such
a provision could be used by any self-interested group in any province to erect new barriers to trade.
The dispute resolution mechanism included in this agreement may deal with these issues but it is not clear that the agreement will bind a province that wishes to go its own way.
Another major impediment to change is article 1507, part III, which states that nothing in this agreement shall be construed to effect the existing rights and obligations of the provinces under other environmental agreements, including conservation agreements. It does not take very much effort to realize that if one province wanted to keep in place an existing trade barrier, all it would have to do would be to claim an environmental exemption. Even worse, it is obvious that new trade barriers could be erected under this article. Again the agreement appears to be a step backwards.
One fact that cannot escape scrutiny is that many new regulations, panels and other administrative functions have been introduced in this bill both at the provincial and the federal level. It is plain that a whole new bureaucracy will spring up: new jobs for bureaucrats, new expense for the taxpayers but not necessarily any benefits to consumers.
However, one provision stands out as an improvement over the past practice and that is the proposed reduction in restrictions on interprovincial trucking. The consensus in this important area should not be dismissed lightly. Barriers to trucking have raised transportation costs, resulted in inefficiencies and lost productivity, and ultimately cost consumers millions. I hope we can capitalize on the consensus reached on this aspect of the agreement.
Some commentators have made the observation that the agreement is only the first step in a process which will see more agreements signed and barriers reduced. While this may be true, Reformers believe that this first step agreement is not necessarily a step forward. If we are going to improve the situation, it is vital that all steps must move us forward and reduce barriers, not leaving the possibility that new barriers can be erected in their place. We have lived with the status quo for too long already and Canadians deserve better.
It is important to look at the historical record and see where we have been as a nation in dealing with this issue. When Canada was created out of four British colonies in 1867 the founding fathers of Confederation had one purpose in mind. They believed that if they united, they could resist being pulled into the American sphere of influence and retain their distinct cultural heritage.
They saw two strategies as essential to resisting American pressures. The first was a unified military which could better defend the borders of Canada. Thankfully we have not had to face a major threat on our own soil since that time. But our armed forces have served with distinction in most major conflicts and all peacekeeping missions since that time.
The second strategy to maintain a distinct identity was to implement free trade between the provinces. It was believed that the free flow of goods and services would strengthen economic, political and cultural ties east to west instead of north to south.
It is quite obvious in which strategy we failed to accomplish our objectives. The fact is that trade between Canada and the U.S. today in many goods is freer and easier than the trade between the provinces.
Where we do fall down on this issue, history has shown it came because of ineffectual leadership in this area at the federal level.
I see my time is running out. I have quite a bit more. Will I be allowed to finish my presentation later?