Debates of June 10th, 1996

Referenda

[Allan Rock, Liberal, Minister of Justice and Attorney General of Canada]

Mr. Speaker, no, that is not the point. We have been monitoring this case and its progress in the courts since long before that issue arose. Our interest is in the attention the Supreme Court of Canada, the highest court in the country, will pay to questions of constitutionality.

I stress for the hon. member and for the House that we have made no decision on the question of whether to intervene. Our decision will only be made after the court has formulated the relevant questions and after we have had an opportunity to examine them in relation to the issues that the court will consider.

[Michel Gauthier, Bloc, Leader of the Opposition]

Mr. Speaker, how does the Minister of Justice explain the fact that, after the government's attempt to change the rules of democracy in Quebec, after its alliance with Guy Bertrand to prevent Quebecers from voting again on their future, after expressing its intention to decide the referendum question, the government now wants to join with Robert Libman in attacking the Quebec Referendum Act, a tool Quebec of democracy has given itself, which it does not want affected by the federal government's intervention?

[Allan Rock, Liberal, Minister of Justice and Attorney General of Canada]

Mr. Speaker, I would first point out that no decision has been made regarding Mr. Libman's case. As I said, we are currently waiting to hear how the questions will be put by the Supreme Court of Canada.

As regards Mr. Bertrand's case, I would also like to say that we are not involved in this case because we want to support Mr. Bertrand. We intervened because of the position taken by the attorney general of Quebec. When he said clearly that the process of Quebec's move to sovereignty was beyond the sway of both the Constitution and the courts of Canada, the Attorney General of Canada had to get involved to counter this statement. It is not true.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, in the Libman case, it is not even the Constitution that is involved, it is the Quebec referendum legislation. What the Minister of Justice is telling us is pretty unbelievable.

I am asking the Prime Minister whether he is aware that for months his government, he and his Minister of Justice, have been killing themselves to bring up the constitutional question at every possible occasion, so as to go at Quebec democracy hammer and tongs at every opportunity, and to constantly assail Quebecers' democratic progress toward sovereignty.

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, the only thing we want is to see democracy respected in Canada. There have been two referenda, and Canada won both times. We are not interested in seeing this continued. It is the Bloc Quebecois and the Quebec separatists who want to see it continued, while most of the people of Quebec and of Canada have had enough.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, if the Prime Minister does not wish to continue, I must say he is experiencing difficulty in restraining himself, since in the Bertrand case and in the Libman case, finding allies in Quebec takes some doing.

Could the Prime Minister admit that, when it comes down to it, the reason for his wishing to intervene in the Libman case is that he wants to see more than one pro-federalist referendum committee created, maybe because he no longer trusts his Quebec federalist allies such as Daniel Johnson, and because he wants to see no more barriers restricting the number of millions his financial allies, some of them with family trusts behind them, are prepared to pour into Quebec, as they did in the last referendum with the Montreal rally?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, there are all kinds of accusations within this question which are not factual. We have respected all of the laws involved. I believe that the fact that some Canadians decided to travel to Montreal in this the freest country in the world, a country which allows separatist MPs within the Parliament of Canada, that MPs and other citizens of Canada wanted to go to tell Quebecers that they must remain in Canada, shows a respect for freedom of speech, which is entrenched in Canada's Charter of rights.

The first charter respecting the right of all citizens to freedom of speech was created in France. I hope that the people of the Bloc and the Parti Quebecois will respect the freedom of speech of all Canadians concerning the future of their country.

National Unity

[Chuck Strahl, Reform, Fraser Valley East, BC]

Mr. Speaker, this weekend thousands of passionate grassroots Canadians rallied to demand some action on Canadian unity. They want the federal government to drive the unity issue to resolution now before there is another crisis and they want and deserve more than lip service from the Prime Minister.

What Canadians expect from the government are some signs of willingness to change, even if it breaks their Liberal hearts to have a smaller federal role in a decentralized but unified country. People realize that the status quo is not working and they want to see a fresh start.

After last year's referendum, the Prime Minister struck a cabinet committee to come up with the answers on national unity. Is this national unity committee still meeting? When can we expect to see the report for the Canadian people?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I am happy to see that at long last, the Reform Party is interested in the future of Canada. When I stood in the House and told everyone that it was not possible to break up a country with a one-vote majority, I well remember the members of the Reform Party sided with the Bloc Quebecois on that issue.

I hope the Reform Party wakes up some day and reads the speech from the throne in which the program for national unity was very well stated. A big part of it will be completed after the meeting of the first ministers Thursday and Friday of next week.

[Chuck Strahl, Reform, Fraser Valley East, BC]

Mr. Speaker, the government has done nothing to reassure Canadians that it has the solutions to keep this great country together.

It has touted the national unity dream team but half of that team is benched and the other half is silent. It stated that distinct society status would solve the problem but it has been rejected time and time again. Now, according to the polls, apparently more Quebecers than ever feel that Quebec may separate. The government has no plan and no team. The 10,000 patriots who were here on the weekend have begged the Prime Minister to finally show some leadership.

The unity minister said that we will have anarchy if the separatists win another referendum.

What is the government's plan to prevent that from happening and when will it announce it so that Canadians can have some reassurance that the government has a handle on the national unity situation?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, all the people who came to the Hill yesterday would be very delighted to know that the Reform Party supports bilingualism in Canada. The people who came yesterday were from Montreal, Quebec, Pontiac and so on. Many of them were anglophones from Quebec who are in favour of the bilingualism policy of Canada which the Reform Party has always rejected.

A moment ago, the hon. member referred to distinct society. Again the contribution of the Reform Party was to vote against distinct society. I hope that some day the Reform Party will wake up. However, if we waited to have the support of the Reform Party in order to solve this Canadian problem we would have no solution. I guess we will have to solve the problem despite the Reform Party.

[Chuck Strahl, Reform, Fraser Valley East, BC]

Mr. Speaker, if only we had some plan from the Prime Minister. The government is so far behind on this issue that it thinks it is first, but it has been lapped by the Canadian people.

The truth is that the government is navel gazing over distinct society and constitutional vetoes, ideas that went out of favour 30 years ago. Canadians know that the realignment of federal-provincial power is a major consideration that will help to bind the country together. Quebecers are not the problem. The regions are not the problem. Ottawa's government is the problem.

Since the provinces refused to meet with the Prime Minister to discuss constitutional change, will the federal government move now and promise to give back to the provinces those areas of jurisdiction which the Constitution states are theirs to administer?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, the hon. member has a copy of the speech from the throne on his desk. Everything he has asked can be found in it.

The Minister of Human Resources Development, for example, has moved on the labour management situation. We made propositions to the provinces in many fields in the speech from the throne. We hope to rebalance the federation. We want to clarify jurisdictions. We want to eliminate duplication. However, the Reform

Party is four months late on that issue and on everything else it is probably 40 years late.

Taxation

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, the Minister of National Revenue would like us to believe that, by suspending the issuance of new advanced tax rulings similar to the case of the $2 billion in family trusts transferred to the U.S. tax free, she was closing the gaping tax loophole denounced by the auditor general. Nothing could be further from the truth. The ruling made by Revenue Canada in December 1991 is still in effect and constitutes a precedent that anyone can use to avoid paying taxes.

My question is for the Prime Minister. Does the Prime Minister admit that his revenue minister's inaction and his government's refusal to investigate this scandal leaves wide open a loophole that can still be used by owners of family trusts or by any millionaire?

[Jane Stewart, Liberal, Minister of National Revenue]

Mr. Speaker, the hon. member is patently wrong. There is action by this government. The issue has been sent directly to the committee on finance for advice and for information to come back to the minister for his consideration.

This is nuts because quite frankly the committee is doing a very expeditious job hearing witnesses from across the country on this very important aspect of the Income Tax Act and we do look forward to their recommendations.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, the government still refuses to shed light on the 1991 case. That is why it is trying to sidestep the issue at the Standing Committee on Finance. That is what is happening.

Even though we are facing one of our worst financial scandals, the Prime Minister continues to sit on his hands. Whose interests is he protecting in Canada, those of the Thomson family, the Bronfman family, the Irving family, the Desmarais family, or all of the above?

[Jane Stewart, Liberal, Minister of National Revenue]

Mr. Speaker, the hon. member seems to be indicating that he does not agree with the democratic process, that he does not want to participate in the democratic process. I understand that he has walked out of the committee that we have asked to seriously look at the Income Tax Act and provide good and full information to us on several occasions.

I would ask him to get to the committee, to listen to the witnesses who are there and to provide the best advice that he can on behalf of Canadians from across this country.

Employment Insurance

[Ian McClelland, Reform, Edmonton Southwest, AB]

Mr. Speaker, my question is for the Minister of Human Resources Development.

On March 27 the minister stated that employment insurance premium surpluses must have an upper limit. The surplus is now estimated to be $5 billion for this year alone. A majority of Canadian pension fund managers recently stated that the primary reason job creation in our country is stagnant is due to payroll taxes.

Will the minister tell the Canadian people when enough is enough and when the job destroying employment insurance payroll tax will be reduced?

[Douglas Young, Liberal, Minister of Human Resources Development]

Mr. Speaker, the Minister of Finance and myself have said on a number of occasions that we are aware that through a series of events we are now moving to a surplus position in the EI account.

My hon. friend would know that a year ago, two years ago, three years ago quite the opposite was the situation. The last thing that the hon. member would want is to have a repeat situation of when we were in a recession with very high levels of unemployment and we were then faced with increases in the rate for premiums.

We are trying to make sure that we can set a level for a surplus in the EI fund that is consistent with the historical trends in that fund. We will be paying close attention to it.

I am sure that we will be able to satisfy the hon. member's concern about making sure that we have a sufficient reserve in the fund but also be able to address the whole question of payroll taxes, including premiums for employment insurance.

[Ian McClelland, Reform, Edmonton Southwest, AB]

In that case, Mr. Speaker, I take it that the minister would work toward making the EI fund self-sustaining and actuarially sound. Had it been actuarially sound previously we would not have to dip in so deep this time. That is the major problem with the EI program. It should be insurance.

The minister knows that chronic high unemployment and under employment of Canada's youth is really a national disgrace. It robs youth of self-respect, hope and a stake in our common good and our common future.

If payroll taxes such as employment insurance and Canada pension fund premiums affect the lowest paid and the most

vulnerable first and most, why does the government continue to put such a high reliance on job destroying payroll taxes to generate revenue?

[Douglas Young, Liberal, Minister of Human Resources Development]

Mr. Speaker, it is difficult to have it both ways. If the employment insurance fund is to be self-sustaining, which in fact it is, because when it falls into deficit the government is required to cover that deficit. The government and the taxpayers are repaid as the employment insurance fund recovers. That has been the case over the last year where the deficit was finally cleaned up and now we are moving to a surplus position.

Unfortunately, neither actuaries, governments, the private sector nor labour, for that matter, can predict exactly the requirements of the employment insurance fund. It depends on the situation that prevails in the economy at any given time.

The only thing we can do is try to be prudent. I understand the hon. member's point with respect to the surplus. We have to be careful not to let it increase beyond reasonable proportions.

As I indicated in my answer to his first question, I do not think the hon. member or anyone else would like to see us go back to a situation where in a recession, in addition to having a major drain on the employment insurance fund, the government would have to increase the premiums to try to reduce that deficit position.

It is always difficult to find a balance but as usual we will try to do the best we can.

Taxation

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, my question is for the Prime Minister. What the Liberal government is doing in the matter of family trusts is outrageous, going as far as muzzling the public accounts committee so as to not let the word out about how wealthy families can avoid paying taxes. All the while, the key players in this matter are still holding positions in the public service.

While hundreds of millions of dollars are at stake and the public is expecting quick action, how can the Prime Minister, who is hiding behind his minister of revenue, justify his government condoning, by not taking action, the flight of capital, tax free?

[Jane Stewart, Liberal, Minister of National Revenue]

Mr. Speaker, let me review the action we have taken.

On receipt of the report of the auditor general we acted that very day and sent his concerns to the committees of this Parliament, committees made up of members of this House that represent Canadians, to look at very important aspects of the Income Tax Act.

It is my understanding that the finance committee will review those aspects of the Income Tax Act. I understand it has been agreed at the public accounts committee to begin to review other aspects, sure to be required, on return from the summer recess.

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, given that the auditor general said it could happen again, that the Deputy Minister of National Revenue confirmed the auditor general's statement and that the Minister of Revenue failed to introduce effective measures, why is the government refusing to shed light on the $2 billion in family trusts that were transferred, tax free, in 1991 and on other cases that may have arisen since then?

[Jane Stewart, Liberal, Minister of National Revenue]

Mr. Speaker, as the hon. member points out, this issue took place in 1991. It predates this government, but we are taking very direct and important action on this concern.

I understand it was the hon. member himself who sat as chair on the public accounts committee when the decision was made of which order the issues presented by the auditor general would be reviewed at finance committee and then at public accounts.