Mr. Speaker, the Bloc Quebecois approves in principle the government's proposal to sell CN to private interests. However, it has serious reservations about certain provisions of Bill C-89.
I will propose amendments to these provisions in committee. We object to clauses 8 and 16. We will also recommend an amendment to clause 6 regarding CN property that may be transferred to the Minister of Transport so that he can put it up for sale later.
Let us start with clause 8. One purpose-undoubtedly laudable-of its seven subsections is to prevent any individual, corporation or associate as defined in subsection (4) from holding more than 15 per cent of voting shares.
Notwithstanding these provisions, subsection (5) allows two such associates to disassociate, so to speak, from each other for the purposes of the act by submitting a statutory declaration stating that they are not acting and will not act in concert with respect to their interests in CN.
Each of the declarants may acquire voting shares up to a maximum of 15 per cent as if he or she was not associated with the other person. This dispensation, which broadens the pool and purchasing power of potential buyers, is probably necessary given the size of the operation. However, CN administrators must still be able to check if, in fact, declarants comply with the terms and conditions of their statutory declarations.
We feel that such control would be difficult to exercise in the case of foreign buyers. We are therefore proposing an amendment under which subsection (5) respecting the statutory declaration would be restricted to Canadian buyers. As a result, two or more foreign associates will not be able to exceed the 15 per cent limit by submitting statutory declarations.
If clause 8 aimed at preventing an individual or corporate takeover of CN must be approved in principle, the same cannot be said of clause 16. Regrettably, even in this bill whose provisions should have been purely financial in nature, the government could not resist, once again, one of its old demons: trying to invade an area of provincial jurisdiction.
Clause 16 may appear harmless. It reads as follows:
(1) The railway and other transportation works in Canada of CN, of every subsidiary of CN and of every corporation formed by any consolidation or amalgamation of any two or more of those corporations are hereby declared to be works for the general advantage of Canada.
The catch is that, once they are declared to be for the general advantage of Canada, these works will be subject to federal legislation. If CN reaches a joint ownership agreement with a short-line railway, this railway will shift from provincial to federal jurisdiction, as suggested in the Nault report, we should point out. And the deed will be done.
Not only is the principle of this federal encroachment on a provincial jurisdiction unacceptable, but so are the economics of it, as we all know that one of the main reasons short-line railways can operate on sections considered non profitable by major companies is that they are not subject to cumbersome
federal railway regulations. Short-line railways need the operating flexibility provincial regulations give them, at least in Quebec.
This federal initiative is therefore likely to discourage the creation of short-line railways and limit their numbers. We must realize that each one of these railways is a section saved from abandonment. If the government now interferes with the development of short-line railways, this will mean that a larger part of the rail network in Quebec and Canada will be abandoned. So, we suggest that only interprovincial works of CN and its subsidiaries, and not those works which are entirely comprised within a province, be declared to be works for the general advantage of Canada.
Moving on to the intention expressed by the minister to purchase and sell separately CN non-railway assets, including AMF, a Quebec company. This company employs some 1,300 people whose jobs could be endangered if the company's ties with CN were severed. Under clause 6 of the bill, the minister may, while CN is a Crown corporation, direct CN to transfer such property. We will move an amendment providing that, before selling these companies, the minister, to protect jobs, will ensure that they are viable and, if need be, will take steps to ensure that they are.
To conclude, while agreeing in principle with privatizing CN, the Bloc Quebecois cannot help but notice that, far from resulting from a rail policy based on the requirements of the economy, this transaction pursues the purely budgetary goal of bringing in a lot of money very quickly. It is not a rational choice. It is a fire sale by a hard-pressed government.
Pressured by creditors, obsessed by Moody's downgrading of its rating, the federal government is putting up for public sale one of our crown jewels, a national treasure, because it desperately needs money to pay the interest on the accumulated debt caused by 20 years of mismanagement. There may be no other way out, but what an admission of failure.
We are witnessing, stunned by such incompetence and the misfortune of being governed by such poor leaders, the decline of a government that had its heyday before the current Prime Minister began, some 20 years ago, as the then finance minister, to dig this bottomless grave into which our national debt is dragging us, and the proceeds from the sale of CN will be but a shovel full of dirt in this grave.
In the face of this failure, how can one resist the temptation of comparing the Canadian federal system to a father who has to sell the family furniture and silver to pay household bills after getting deep into debt because of profligate spending and improvidence? No wonder, Mr. Speaker, that we, Quebecers, are anxious to get out of the house.