Debates of Sept. 19th, 1996

Auditor General

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, unfortunately it is obvious that the Leader of the Opposition has not had time to read the majority report. First, their criticisms were made very respectfully, and second, they accepted most of the auditor general's recommendations very favourably. They thanked him for them, point by point. That is in the report, the thanks to the auditor general. Moreover, we in government thank the auditor general for the points he had raised, and because of the fact that he

did raise those points-and the majority report says this-the Ggvernment will be in a position to act.

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

Mr. Speaker, for the past three years, we have been asking the government to get to the bottom of the family trust scandal. It was not until the auditor general recently condemned the scandalous transfer of $2 billion in trust funds to the U.S. tax-free that the Prime Minister finally decided to ask the finance committee to review, to shed light on this matter. The Liberal majority tabled its report yesterday and all they did was attack the auditor general.

My question is for the Prime Minister. Who is the Prime Minister trying to protect?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, first of all, this matter was first raised in 1991 under the previous, Tory government. Second, right after we came to office, we dealt directly with the matter of family trusts and, in our second and third budgets, we eliminated all the fiscal abuses associated with family trusts. Third, the hon. member must know that this matter has nothing to do with family trusts. It was indeed a family trust, but the real issue is how to collect taxes from immigrants when they leave the country. That is the real issue.

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

Mr. Speaker, if this is only a Tory matter, why should they be afraid to get to the bottom of this scandal? Why? While the Minister of Finance and the Prime Minister are stalling, more billions of dollars are leaving the country tax-free, because the government refuses to plug the loophole created in 1991.

The Prime Minister is aiding and abetting the flight of capital, and I ask him again the same question: Whose interests is he trying to protect?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, it is really unfortunate on a matter of some seriousness that the opposition is unable to treat a serious matter with the serious degree of concern that it requires.

Instead of yelling here in the House or trying to seek a diversion, why does the opposition not deal with the fundamental matter which is what the majority report did? This occurred in 1991 under the previous government. Immediately upon taking office we eliminated all fiscal abuses having to do with family trusts. We then asked the finance committee to take this issue on. It has in fact made a serious number of recommendations that we as a government intend to look at.

I only wish the opposition parties had been able to sit down and understand the issue. Under those circumstances they might have been able to deal with the debate in an intelligent way.

Somalia Inquiry

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, the government cannot have it both ways on the Somalia inquiry. The Prime Minister has complained that it is too slow, too expensive and too hard on witnesses. The reason the inquiry has been delayed again and again is that the department was not producing the relevant documentation. If this government wants someone to blame in this whole affair, it should simply look in the mirror.

Why will the Prime Minister not simply admit that if the Minister of National Defence and Jean Boyle were really capable of doing their jobs, the commission would have had all the documents and the Somalia inquiry would be on track today?

[David Collenette, Liberal, Minister of National Defence and Minister of Veterans Affairs]

Mr. Speaker, the hon. member says the government cannot have it both ways. I would submit that her party cannot have it both ways. Her party advocated the establishment of the commission. That commission, as I have reminded hon. members, will allow for an impartial setting to hear all of the evidence and have everyone dealt with fairly.

However, for the last three days in the House, if we look at Hansard , what have we seen? We have seen accusations coming from the other side, imputation of motive and reflection upon evidence. One cannot one day advocate having an inquiry with an impartial setting and then the next day come in the House of Commons and do the opposite. It is the opposition that wants it both ways.

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, this very minister, by appearing on TV and pronouncing Jean Boyle innocent even before the thing was finished, has castrated that commission and that is all there is to it. It is as simple as that.

The Somalia inquiry is having such a hard time doing its job because the department does not have any real leadership. We then see a minister step in and think that he can make announcements about it before it is even over.

The minister and Jean Boyle himself do not know up from sideways. There is precious little respect in the military across the country for this minister and for Jean Boyle. That is why the department is in such a mess and why the Somalia inquiry has taken so long.

I will ask one more time. If the Prime Minister is really serious about mopping up the mess in the military, why will he not start at the top with the minister and Jean Boyle?

[David Collenette, Liberal, Minister of National Defence and Minister of Veterans Affairs]

Mr. Speaker, the hon. member has uttered an absolute untruth. I am sure she has done this inadvertently. I defy her to show any time where I reflected upon evidence before that inquiry.

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, not on evidence but by inference he was saying that Jean Boyle is a great guy. On national television the minister stood up and said: "He is a fine man, we support him and he is doing a great job". I do not know how much more clear I could get that he is trying to influence and interfere with the commission and its findings.

The only reason the Prime Minister will not fire these guys is because he is worried about potential political damage. Let me tell him from Canada: There is far more damage in keeping them than in letting them go.

I ask the minister, the Prime Minister or whoever is going to juggle and get themselves up on this one, why does the Prime Minister not just admit he was wrong, cut his losses and let these guys go?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, we have an inquiry that is doing the job it was asked to do. We would like to have the results as quickly as possible so we can deal with the matter efficiently.

In the meantime, I urge everybody to let the commission do its job, let General Boyle run the armed forces and let the Minister of National Defence do what is needed in national defence to give it some stability and the political leadership that is needed. In the previous nine years, in the previous administration, the department had seven ministers. There was no connection between the political needs and the administration. The stability that is needed is being established at this moment by the good work the Minister of National Defence is doing.

The Auditor General

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

Mr. Speaker, family trusts are a strange issue to say the least. Two billion dollars were transferred out of Canada tax free, with the kind help of Revenue Canada officials. The auditor general exposed the scandal, the official opposition demanded that an inquiry be held, the government refused, turned around and attacked the auditor general.

My question is for the Prime Minister. Why does the Prime Minister not want to look into this scandal in which billionaires are able to transfer huge assets to the United States to avoid paying taxes like everyone else?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, regarding the substance of the question, the majority report contains a series of recommendations vital to ensuring that any loophole that may have existed is plugged.

That said, the hon. member used the word "scandal", implying a lack of credibility on the part of certain people. We were not in office when this took place, the Conservatives were, and I must point out that the auditor general himself, whom the hon. member quoted, confirmed the integrity and credibility of all concerned.

Is the hon. member telling us that the auditor general was mistaken?

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

Mr. Speaker, how can the Prime Minister justify refusing to review such an unfair tax system, which always benefits the same people, unless he is trying to protect those around him who contribute to his election fund?

[The Speaker]

Colleagues, the question itself seems to be imputing motive and that should not be a part of the questions we address to one another. I would caution all members to please be very judicious in their choice of words.

I saw the hon. Minister of Finance was moving to answer. If he so wishes, I will permit it. If not, we will pass on it.

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the problem in dealing with this issue is that the hon. members opposite have been overtaken by the events.

We set out to tackle the family trust problem immediately upon taking office. We started by repealing the 21-year rule.

Then, we eliminated the choices that applied to the privileged. As a result of the steps taken by this government, the fiscal abuses associated with family trusts have been eliminated. Unfortunately, the hon. member is two years out of date.

Somalia Inquiry

[Jim Hart, Reform, Okanagan—Similkameen—Merritt, BC]

Mr. Speaker, double standards prevail at the Department of National Defence. There is one policy for General Boyle yet a different policy for the rest of the Canadian Armed Forces. Due process for subordinates and none for General Boyle.

In the tragic death of Corporal MacKinnon, his commanding officer Major Hirter said he is responsible and he has been charged. Boyle said he is responsible yet nothing has happened.

Is this glaring double standard the kind of management the Prime Minister is proud of?

[David Collenette, Liberal, Minister of National Defence and Minister of Veterans Affairs]

Mr. Speaker, here is yet another example of the hon. member reflecting upon something on which he knows I cannot comment because of my obligations under the National Defence Act.

He has made reference to potential proceedings against one member of the armed forces and he wishes to have this debated in the House of Commons. We have a justice system within the military and the people in the military are subject to it. It is constitutionally sanctioned by the supreme court. It could, perhaps, be in need of some updating and I hope Parliament will help us in that.

I think it is grossly unfair for the hon. member to raise the cases of individuals knowing that I cannot reply because of the obligations I have under the National Defence Act.

[Jim Hart, Reform, Okanagan—Similkameen—Merritt, BC]

Mr. Speaker, again the Minister of National Defence tries to spin the argument in his own favour. He knows full well that Major Hirter will get due process. The problem is that a political appointee of the government does not seem to be able to be lowered to the due process the law system should provide. There is a clear double standard.

Canadian Armed Forces personnel were ordered not to use work or business hours or resources to prepare their testimony for the Somalia inquiry. Yet despite this order, access to information documents show that General Boyle spent more than 50 business hours preparing to testify.

Is this glaring double standard and violation of orders the kind of management the Prime Minister is proud of?

[David Collenette, Liberal, Minister of National Defence and Minister of Veterans Affairs]

Mr. Speaker, the hon. member knows I cannot comment on any matter before the inquiry. Even if I could, it would be very difficult to cut through the convolutions and non sequiturs in his question.

The Auditor General

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

Mr. Speaker, listening to the Minister of Finance, one gets the impression that only the Liberals are right regarding this issue. All the editorial writers are wrong. The Liberals are the only ones in step, as in the case of the army.

The Prime Minister's silence today speaks volumes. So do the comments made by the Minister of Finance, who tries to cover up his colleagues' blunder.

I ask the Minister of Finance: What does he have to say to the statements made by the auditor general, Mr. Desautels, who said he would do the same work again, and by the former auditor general, Mr. Dye, who said the Liberal government does not understand anything about the auditor general's role?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the majority report said that the advance ruling process must be protected. The auditor general said the same thing. Is the Bloc Quebecois for or against that?

The majority report says the credibility or the integrity of the public servants involved is not in any way at issue. Similarly, the auditor said he had no intention of attacking the credibility and the integrity of these public servants.

The Bloc Quebecois cries foul, but the auditor general does not agree. There is no scandal, as stated in the majority report.

Clearly, we must now follow up on the substance of the comments made by the auditor general, and the majority report agrees with that.

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

Mr. Speaker, I can remember seeing the Minister of Finance more comfortable than he is today. If anyone was attacked, it is the auditor general, yesterday. The members opposite are having a hard time dealing with the substance.

I ask the Minister of Finance why he is taking cover behind something which is said to have occurred in 1991, on December 23, around 11 p.m., just before Christmas, when everyone is partying. Some hard-working public servants can come and find a little hole to slip $2 billion through. This still goes on every day, and the hole is not being plugged from the other side.

The auditor general called for an end to it. Why not take action? Why not follow up on the auditor general's recommendation? Who are you protecting?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, let the hon. member name these public servants. He is attacking the credibility of the public service. If he wishes to do that, then he should give names. Who is he attacking? If he has the courage to talk about substance, then he should read the majority report. We must deal with fundamental issues here. Why is the Bloc Quebecois afraid to tackle these issues, preferring to create a scandal on the grounds of lack of substance.

Auditor General

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, the Auditor General of Canada is an independent officer of Parliament whose mandate it is to investigate government mismanagement, waste and abuse.

Not only is the Prime Minister critical of the independent inquiry into Somalia but the Liberal dominated finance committee has also found fit to interfere with the day to day affairs of the auditor general.

My question is for the Prime Minister. What is the purpose of this attack on the auditor general, who is an independent officer of the House and whose job it is to investigate the government and report back to this House?