Debates of Sept. 20th, 1996

Auditor General

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

Mr. Speaker, yesterday the Minister of Finance seemed proud of the Liberal majority report on the family trust scandal, a report he said he applauded. However, the former auditor general, Mr. Dye, maintained that Liberal members failed to understand the watchdog role of the auditor general, and the auditor general himself stated this week, after the report was published, that his position had not changed. Thank goodness, because that is what he is there for.

I have this question for the Minister of Finance. Although it is obvious that Liberal members made a terrible mistake in this report by attacking the auditor general, why does the Minister of Finance insist on endorsing the report? And I repeat the question that was asked yesterday: Who is this government trying to protect?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the majority report is very favourable. Actually, there are plenty of very favourable comments on work done by the auditor general. I admit that they disagree with the auditor general on one particular point. However, a standing committee of our House has the right to criticize or to disagree with an employee of Parliament, whether, as

I said yesterday, he happens to be the Prime Minister, the Minister of Finance, the Governor of the Bank of Canada or the auditor general.

The hon. member asks me why we endorse the majority report. It is because the report endorses the vast majority of remarks and comments made by the auditor general. That is why.

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

Mr. Speaker, to say that a committee has the right to express its views does not prove anything. After all, in a democracy we have the right to be wrong. It is not a sin.

We know the government is wrong, but we are asking whether it could act responsibly to do something. Because as far as important issues go, it is no accident that all editorial writers, at least those in the French newspapers, are saying this does not make sense.

The former auditor general says it does not make sense, and the current auditor general says so too. The consensus is growing. And of course we agree. "On a minor point", the Minister of Finance says. Actually, on May 9 this year he said:

-we certainly said clearly when we came to office that there were weaknesses in the taxation system that needed to be corrected. We have supported the actions of the auditor general in this area and will continue to do so.

That is what we are asking the government to do. What we are asking is this: Once again, whose interests are they protecting by not responding to the judgment made by the auditor general? They say it is only a minor point, but we think they disagree on the main point made in the auditor general's report.

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the auditor general's main point is that the problem today is how to treat capital gains when someone, an immigrant, a person, a trust, a company, or partnership wants to leave Canada.

That was the auditor general's main point, and the majority report endorsed it, saying that action must be taken. We agree, and we intend to take that action.

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

Mr. Speaker, the loophole is still there. The auditor general said so and they are trying to rap the knuckles of the auditor general because he did. They are telling the auditor general: You should have left that alone.

I have the impression that the Minister of Finance took Camouflage 101 with the Minister of National Defence. They are sitting side by side, and I am sure they are comparing notes. I want to ask him why he endorsed what the committee had to say about the auditor general. Who gave the order to cover up this scandal? The Prime Minister or some generous party supporter who might want to use this loophole?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, this is ridiculous. The government asked the Standing Committee on Finance to consider the auditor general's report and to give us its opinion on the main point: How do we treat capital gains when an immigrant wants to leave the country?

The majority report was very thorough in the way it dealt with this point, and the government intends to take action. It is certainly not our policy to cover up the situation. We wanted to shed some light on the matter, and the majority report did so, and we intend to act.

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

Mr. Speaker, the Minister of Finance asked the finance committee to look into the problem but not to take a partial look. When will the Minister of Finance start looking out for all Canadian taxpayers, not just Canada's ten wealthiest families.

In its report, instead of plugging the tax loophole that allowed $2 billion to be transferred out of Canada tax free, the Liberal majority on the finance committee throws the door wide open for wealthy Canadian families. It concluded that this scandal was legal, thus upholding a decision made by Revenue Canada that may cost Canadian taxpayers hundreds of millions of dollars.

My question is for the Minister of Finance. Does he recognize that his acceptance of this report, yesterday and again today, flies in the face of the recommendations of the auditor general and allows huge assets to be transferred out of the country by wealthy Canadian families that end up not paying taxes in Canada?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, there is no doubt that capital gains considerations may be a concern for wealthier families. But they can also be of concern to families with lower incomes.

I mentioned yesterday the case of the widow of an immigrant, who decides to go back home. If she happens to be a shareholder in a small private company, she too will be affected because, in every case, the question is: How do we deal with capital gains when an individual, any individual, leaves the country? It could be a retiree who moves to Florida, as many do. That is the question, a very serious question that must be considered thoroughly.

The hon. member raised the issue of loopholes. I have a list three pages long of loopholes that we have closed since taking office. The point of the matter is: how to ensure that the tax system is fair. That is our objective. I wish the opposition would at least contribute to the debate.

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

Mr. Speaker, the minister referred to tax planning and forward averaging. We have nothing against that. We have a problem however with such vehicles and provisions of the Income Tax Act, which the minister refuses to change, being used to transfer millions of dollars to the U.S. or elsewhere tax-free. Something is wrong. Everyone has to pay taxes to Revenue Canada, but when it comes time to deal with the rich friends of the Liberal Party, nothing is done. Something is wrong.

My question to the minister is as follows: Is this report not being concurred in to protect the interests of those in high political circles, with the approval of the Minister of Finance?

[Paul Martin, Liberal, LaSalle—Émard, QC]

Mr. Speaker, in the three years we have been in office we have closed more loopholes, more openings in the tax system than any previous government. As a result of our actions the tax act is more fair. Wealthy Canadians are paying far more taxes. I have three pages of measures which we have taken to deal with this.

This issue is not one that only applies to rich Canadians. It applies to Canadians of very ordinary circumstances who for one reason or another decide to leave the country, whether it is to retire in another country or return to the country of their birth. These people ought to be treated fairly. They ought to be treated in a way that does not deprive the state of taxation.

At the same time we have tax treaties with some 60 countries. We are operating in a way that the OECD has established. Our system is tighter than the vast majority of other countries. I am sure members opposite do not want us to act in a way that would be unfair to ordinary Canadians. That is why we asked the finance committee to look at the issue and they did. That is why we have said we are going to act quickly on their recommendations.

Somalia Inquiry

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

Mr. Speaker, double standards and conflicts of interest abound in the Somalia inquiry. The defence minister is interfering with the inquiry at every turn. He has allowed General Boyle to receive preferential treatment by giving the government's own dream team of lawyers' access to confidential military police reports and, possibly the biggest conflict of interest of all, the designing of the Somalia inquiry mandate.

Will the defence minister confirm that General Boyle played a part in the drafting of the mandate and the terms of reference of the Somalia inquiry?

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

Mr. Speaker, the terms of reference for that inquiry originated in my office in consultation with departmental officials.

They were amended by me at a late stage to ensure certain things were put in which I thought were germane to the efficacy of the inquiry. The terms of reference for the inquiry are mine and I take responsibility for them. I think they have been widely acknowledged as being comprehensive, all encompassing and they will get to the bottom of the matter.

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

Mr. Speaker, I would like to thank the minister again for not answering my question. I wanted to know if General Boyle was involved in the drafting of the mandate and terms of reference.

Not only is the government hiding behind the inquiry, it is interfering with it at the same time. The Prime Minister attacked the inquiry in the most flagrant fashion. His next barrage went to the noble members serving in the Canadian Armed Forces who choose to leave. These men practice leadership and responsibility with accountability. The Prime Minister attacked them. Does the Prime Minister think it shows moral fibre to attack retired generals who were honourably serving this country?

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

Mr. Speaker, if anyone has been interfering with this process it is the hon. member and his colleagues. As I said yesterday to his colleague from Beaver River, they have reflected on evidence, impugned motives of individuals, and made all kinds of wild accusations in the House.

This demonstrates the reason why we had to have the inquiry in the first place, to take it out of the partisan atmosphere of the House of Commons, to put it in a judicial setting, an impartial setting so that everyone could be heard fairly and all the evidence could be examined clearly and thoroughly.

The hon. member is the best advertisement for the reasons why we set up the inquiry: to take the partisan aspect out of it. All the hon. member and his colleagues have done in the last number of months is to turn this into a partisan issue. I do not believe that the people of Canadian appreciate that very much.

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

Mr. Speaker, the people of Canada will judge the government on this issue.

The minister would have us believe that the cuts to national defence have caused the low morale in the forces. It was not budget cuts that shredded documents. It was not budget cuts to that lied to the military police. It was not budget cuts that broke the Access to

Information Act. It was General Boyle and this minister and this government approves of it.

Why will he not admit that it is the Liberal government's lack of integrity and lack of ethics, not the lack of money, that is hurting our Canadian Armed Forces?

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

Mr. Speaker, it seems quite obvious that as the days go by, the hon. member is becoming more and more hysterical about this problem. We prefer to deal with things in a calm and rational way and let the inquiry do its work.

He talks about the people of Canada judging us. Mr. Speaker, if you look at the opinion polls, the people of Canada have judged his party already and they have found it totally wanting on just about every issue that affects Canadians and it will be the same thing on this problem.

The Judiciary

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, my question is for the Minister of Justice.

Yesterday, the Canadian Judicial Council voted unanimously in favour of removing from the bench Mr. Justice Bienvenue, a judge of the Superior Court of Quebec. Last July 5, the justice minister indicated clearly that he was awaiting the council's recommendations before taking action regarding Mr. Justice Bienvenue.

Will the Minister of Justice tell us whether or not he agrees with the recommendation of the Canadian Judicial Council that Mr. Justice Bienvenue be removed from the bench?

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

Mr. Speaker, we have not yet received the formal decision from the Canadian Judicial Council. We expect it perhaps today or next week.

When I have received the report, it is my intention to discuss it with my colleagues in order to decide on the next step.

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, the board of inquiry recommended that Mr. Justice Bienvenue be removed from the bench, and now the Canadian Judicial Council has endorsed this recommendation. What is the minister waiting for to take action, and why is he stalling? It is in the news, everyone knows about it, it has been in the news for a long time now.

What is the minister waiting for to table a resolution, right now or early next week, in order to close the final chapter on this case and ask the House to remove Judge Bienvenue from the bench?

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

Mr. Speaker, the hon. member will not have to wait long but the process will be followed. That process involves me receiving the official notification of the council's decision, it involves me consulting with my cabinet colleagues and then taking action. That is exactly the way we are going to approach this matter.

National Defence

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

Mr. Speaker, we saw after General Boyle's speech on Wednesday that he has now invented an entirely new military phrase. It goes like this: "If you cannot stand the heat get out through the kitchen". Now it is okay for the general to avoid scrutiny but the minister cannot avoid the scrutiny of this House and the questions that have been asked.

The minister was asked: "Was General Boyle involved in drafting the terms of reference for the Somalia inquiry?" Was he involved? Yes or no?

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

Mr. Speaker, I answered the question fully in my first answer.

The terms of reference which I tabled in March 1995 were a reflection of the government's thinking in trying to get to the bottom of this. A number of people, a number of officials, worked on these terms of reference in conjunction with the deputy minister and the judge advocate general. The point is that these terms of reference belong to the government. They reflect the government's thinking clearly.

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

Mr. Speaker, obviously this is question period and not answer period.

I want to say this again slowly so the minister understands. We are asking a simple question on ministerial accountability. We are asking, was General Boyle involved in the drafting of the guidelines for the Somalia inquiry? Was he involved, yes or no? Tell the Canadian people.

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

Mr. Speaker, these are the people who ask about ministerial responsibility. I am the minister. I take responsibility for those terms of reference.

They reflect the thinking of the government. They were drafted by officials in the department in conjunction with the judge advocate general on my authority and I take responsibility for them.

Bertrand Litigation

[René Laurin, Bloc, Joliette, QC]

Mr. Speaker, my question is for the Minister of Justice.

Yesterday, Guy Bertrand announced, before a select group of VIPs close to the highest echelons of the Liberal Party of Canada, that he wished to pursue his legal crusade against Quebec's attaining sovereignty. Last May, the minister stated that the main reason for the federal involvement in the Bertrand court case was the position the Government of Quebec had taken.

Now that the Government of Quebec is withdrawing from the case, could the minister tell us what could now motivate his intervention alongside Mr. Bertrand?