Debates of Nov. 20th, 1997

Canadian Wheat Board Act

[Leon Benoit, Reform, Lakeland, AB]

moved:

Motion No. 8

That Bill C-4, in Clause 3, be amended by replacing lines 12 and 13 on page 4 with the following:

“rum at the meetings, which shall be at least two-thirds of the board members and a ratio of two elected directors to one appointed director, and the confidentiality”

[Dick Proctor, NDP, Palliser, SK]

moved:

Motion No. 13

That Bill C-4, in Clause 3, be amended by adding after line 10 on page 5 the following:

“(3) Directors shall be elected by producers on the basis of one vote per producer permit book

(4) There shall be limits placed on the expenditures made by any candidate for election to the Board of Directors.

(5) There shall be limits placed on the expenditures made by any third parties toward the election of candidates to the Board of Directors.”

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, it is a pleasure for me to rise and address my comments to Group No. 4 of the amendments before the House.

I must say that it is exceedingly difficult for all of the members from whatever party and whatever point of view to address such a large group of amendments because they deal with so many different areas.

We have 16 amendments in this group that we are going to endeavour to try to adequately address and debate in a short 10-minute intervention. In light of there being 16 amendments in 10 minutes, I will have to confine my comments to just a few of them.

Perhaps for the viewing public watching this debate at home with interest I am sure, I should note that Group No. 3 comprised Motion No. 3 and was dropped because apparently it had been brought forward at the committee and therefore was ruled out of order.

I did want to make the point when I put that motion forward that what it did was remove reference to the president as a member of the board of directors.

In other words, the president would not have served on the board of directors.

[The Deputy Speaker]

The Parliamentary Secretary to Minister of Fisheries and Oceans on a point of order.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, this issue has been debated at committee and lost. The member is debating Group No. 3 which has been ruled out of order by the Chair.

[The Deputy Speaker]

I thought the hon. member was making a passing reference. He did say it had been ruled out of order and I am sure he is not going to continue discussing the motion. He is proceeding with his remarks, I am certain.

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, I was just making passing reference to it for the sake of the viewing public at home who might not have known why we moved straight from Group No. 2 amendments to Group No. 4.

On to Group No. 4 amendments of which, as I have indicated, there are some 16, Motion No. 5 is an amendment put forward by myself on behalf of the Reform Party of Canada, the official opposition. It calls a fully elected board of directors. The rationale for this is that if this board is going to be put into place for the best interest of farmers, for the best interest of western grain producers, then certainly they should have the right to elect all of the directors to the board.

We have the situation in this legislation where the government and the minister still retain the right to appoint five directors, one of which will be the president and the chief executive officer of the board of directors. We find that completely reprehensible. We do not understand the inequity, the inequality in the system whereby the Ontario Wheat Marketing Board can have a fully elected board of directors to run the affairs of the Ontario Wheat Marketing Board and yet western grain farmers are denied that fundamental right of electing their entire board of directors.

We would certainly urge all members of the House in light of that to support Motion No. 5 and ensure that this bill is amended so that we have a fully elected board of directors.

Motion No. 7, also in this Group No. 4, deletes the powers of the board of directors. The bill, as it is presently structured, lays out different powers for the appointed directors and the elected directors. Of course, if Motion No. 5 is successful and passes and you have all 15 elected as they should be, then there would be no need to have a differentiation in the powers of those individual directors.

Motion No. 9 ensures that the elected board and not the minister would have control over the hiring and firing of the president. If farmers are to truly have a say in the way that the board operates, I think that this is fundamental. During committee hearings, the witnesses who appeared before the committee, and time after time we heard this, the groups who appeared, as short as the list was and as confined as the time was allowed at committee, did make the point that they felt that the board of directors should have the power to hire and fire the president and the chief executive officer.

We had some of my hon. colleagues remark about that earlier and cite examples of the credit unions and the co-ops and other successful co-op enterprises where Canadians have seen fit to band together for their mutual financial best interest on a voluntary basis, but they retain the right to elect their board of directors and that board of directors then hires the administrators. We see no reason whatsoever that this new structure, this new Canadian Wheat Board, would not have a similar process in place.

I would like to add to that and to the comments of my hon. colleague from Wetaskiwin who spoke a few moments ago. I find it more than a bit strange that the more socialist people in this country, whenever a state run enterprise is under scrutiny, always fall back and say that it cannot exist in a free market economy. It is in the best interest of the producer, but we have to protect that interest because if there were any competition, it simply would not survive. In the long term interests of the farmers, in this case the western Canadian grain farmers, we need to ensure that the monopoly, the compulsory nature of the Canadian Wheat Board, is retained.

I find that somewhat puzzling, just as my hon. colleague from Wetaskiwin did, in the sense that there has been a longstanding tradition in western Canada as there has been across this country of enterprises that have not only survived but have indeed thrived in a free market economy. He cited the examples of the co-ops, the pools and the credit unions which I am familiar with as I am from a rural area and was a farmer in my previous life.

Nobody said when credit unions were put into place that Canadians would be forced to join a credit union. No one said you cannot do your business at a bank because it is in your best interest to belong to a credit union. Imagine the open rebellion there would be in this country if everyone were forced to bank at the same institution. The credit unions have done quite well. They have filled a niche market and they continue to enjoy enormous support especially in the rural areas of western Canada.

Motion No. 10 would ensure some minimum production level so that the vote of a hobby farmer would not totally cancel out the vote of a full time farmer, someone who is earning his living and has a lot more at stake with the business conducted and the decisions made by the Canadian Wheat Board than someone who is earning all or most of his income off the farm.

The rationale for Motion No. 11 is that once the initial elections have taken place, the minister's involvement in the election of the director should be limited if farmer interests are to be served. The minister's control of the barley plebiscite earlier this year proved that at times when a minister is directly involved, he can structure a vote to ensure the outcome he wants.

Motion No. 14 also refers to the hiring and firing of the president. At the end of the day it is the board of directors that must retain that control over the president and the president cannot be beholden in any way to the minister or to the government of the day.

It is very difficult when we look at the way many of these motions are grouped to go through them in a singular manner. I refer briefly to Motion No. 19 which ensures that the new corporation will have to adhere to the code of ethics guidelines for corporations. The federal government initiated the signing of this code by Canadian businesses in September 1997. The code sets out standards for ethically, socially and environmentally responsible business practices. However, the federal government did not instruct its departments and agencies to sign the code.

Given that the wheat board markets extensively abroad we feel it is more than appropriate that the corporation become a signatory to the code in which it would commit among other things not to make illegal and improper payments or bribes and will refrain from participating in any corrupt business practices. That is just a small part of the code.

It is interesting to note that question was put to the government by an hon. member during question period, that it is pretty hypocritical of the government to insist that businesses now adhere to this code when crown agencies themselves are not required to. That is the purpose of that amendment.

I look forward to a return of the lively debate we have seen over the past hours.

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, I am pleased to take part in this interesting grouping as previous speakers have indicated. Motions Nos. 4 through 19 include a large variety of important items, the election of all directors, giving the standing committee some insight into the ongoing work of the Canadian Wheat Board, the equality of those who are elected and those who are appointed, the removal of the president and how we would proceed on that important note should it ever come to that, minimum production levels, which I will come back to in a short while, regulations respecting elections and the staggering of elections, which I think is an important point as well, the terms for the president, code of ethics and so on.

I did want to talk a bit about Motion No. 10. This is a motion put forward by the previous speaker, the member for Prince George—Peace River. I think I understand what he is getting at here. He wants a minimum level. In fact, he talked about the difference between a hobby farmer and a somebody who earns his living in farming and who should have the right to vote and who should not.

I want to go on record to say that this caucus will very strongly oppose that. I heard a member from that party talk about two tier. If there is anything that is two tier it is clearly this.

In this caucus we think that as long as a farmer is sending one bushel of grain to the wheat board that he or she should have the right to a vote on the election of the board of directors.

I also want to talk about Motion No. 13 which is contained in Group No. 4. I think how the directors are elected is very important. I want to take a minute for the benefit of the people listening to read Motion No. 13:

(3) Directors shall be elected by producers on the basis of one vote per producer permit book

(4) There shall be limits placed on the expenditures made by any candidate for election to the Board of Directors.

This is a very important aspect of it:

(5) There shall be limits placed on the expenditures made by any third parties toward the election of candidates to the Board of Directors.

I want to elaborate on Motion No. 13 if I may. If the wheat board is to have a board of directors, and we certainly go along with that, then it is essential that the majority of them are elected through free and fair elections. That means, as I said before, one vote per producer holding a wheat board permit book.

It seems to me on Motion No. 10 that the Reform Party wants to see the large scale agribusiness farmers have more votes and more clout than their neighbours. We say this is totally anti-democratic and we want no part of it.

Fair elections also mean a limit on campaign spending by candidates just as in federal and provincial elections so that wealthy individuals do not have an unfair advantage. Fair elections mean the strict and transparent limit as to how much third parties can spend on elections and how much they influence the outcome.

We are reminded of the million dollars that the Alberta government poured into the barley vote last year to try to influence that one and fortunately to little or no avail.

As has been pointed out repeatedly, the wheat board is a $6 billion industry and certain corporate interests would love to get their hands on it. Western grain farmers do not want those folks with deeper pockets than the rest of us to influence these elections unduly on the board of directors.

We are also witnessing what could only be termed as a disgraceful media campaign by other friends of the Reform Party, the National Citizens Coalition, again to try to discredit the Canadian Wheat Board.

The coalition claims to be funded by ordinary Canadians, but we all know that it is bankrolled by the friends of the Reform Party and the the big business community in this country. We know who is in line to be the next president of the National Citizens Coalition, a former member of the Reform caucus.

With those points, we think it is very important that the election of the new board of directors be done in a free and fair way. We will be watching and hoping that the government will move to make some accommodation so that can result.

[Hélène Alarie, Bloc, Louis-Hébert, QC]

Mr. Speaker, we have come to Group No. 4. I will go through the motions one by one, after which I will give an overview, because I have the feeling we will not go any further.

The first motion in Group No. 4, Motion No. 4 moved by Mr. Borotsik, proposes that 10 out of 15 directors be elected. There is a small problem, however, because this motion means that directors would be elected according to regulations made by the governor in council as set out in clauses 3.06 to 3.08. This eliminates what makes clause 3 attactive, which is that producers are appointed by other producers. There is no longer a specific reference to their being elected by producers, as was the case in clause 3.02. This reduces the significanace of the representation by producers on the board of directors.

It is the same for the amendment deleting the paragraph about the maximum term of office of directors, and this is unthinkable. We are therefore going to be voting against this motion, although we were very much in favour of greater representation by producers.

Motion No. 5 would increase the number of directors on the board from 15 to 20. For the reasons I gave earlier, we will vote in favour of this amendment, which fits in with our wish for greater representation and a greater role on the board of directors for producers.

Now, on to Motion No. 6. I am certain that, had my colleague, Mr. Chrétien, been able to debate it, he would have done a splendid job.

[An hon. member]

Jean-Guy?

[Hélène Alarie, Bloc, Louis-Hébert, QC]

Jean-Guy Chrétien of the Bloc Quebecois. Jean-Guy on this side, not Jean on that side.

Mr. Chrétien pointed out that the government does not want the president to be appointed by members of the board of directors but by the governor in council. The Bloc is therefore moving that this appointment be considered by the Standing Committee on Agriculture and Agri-food. We did not get the results we were hoping for when this bill was considered in committee, but we still believe in the strength of this committee and the interventions that must be made, and we think that the appointments should be subject to the approval of the Standing Committee on Agriculture and Agri-food.

This brings me to Motion No. 7. The proposed amendment would create a potential distinction between the powers, duties and functions of a director who is elected and those of one who is appointed. At this point, we have little or no idea of what this amendment would mean in practical terms, and in the absence of information, we are abstaining. We will therefore vote against.

Now comes Motion No. 8; I feel like a school teacher. In Motion No. 8, the proposed amendment would set the board's quorum at two-thirds of the board members and a ratio of two elected directors to one appointed director.

If we keep looking at what it wanted at the grassroots level, namely, greater control by grain producers, farmers and people who have a major interest in this bill, we do of course support an amendment that would see a quorum of at least two-thirds of the board members, thus twice as many elected directors. This is consistent with what we want, which is more board members who are producers. This is why we support this motion.

This brings us to Motion No. 9. Under this motion, the board, in consultation with the minister, decides the terms of removal of the president of the board and implements them. The amendment substitutes the chairman of the board for the president. We therefore support this amendment, because it puts power in the hands of the board. And as we want the amendments to increase the number of farmers to be agreed to, for reasons of consistency we support this motion.

This brings us to Motion No. 10. Under this amendment, in the bylaws for board members, the governor in council should give a vote to producers producing a certain quantity of grain.

I listened with considerable interest to remarks made in this House on this motion. However, the experience I have had in my riding of having many part time farmers and realizing that they provide strong and solid support to the agricultural community makes it hard for me to oppose their participation, however limited, in the Canadian Wheat Board. If the Canadian Wheat Board is there to efficiently market a crop—I heard some colleagues say this morning that it was a bit of a monopoly, but it is not a monopoly when it is in the hands of the producers, in my opinion—it is appropriate for all these producers, even the smallest ones, if the Canadian Wheat Board is a good one, to be protected by a structure for the marketing of their crop.

Of course, when a person has thousands of hectares, this may be an amusing question, but in real life we sometimes see part time farmers or small scale farmers end up as large scale ones. They all make a valuable contribution to agriculture and we find it very hard not to consider them all, to reject them. For this reason we will vote against this motion.

This leads us to Motion no. 11. Here the amendment makes it not the minister who makes regulations in consultation with the board, but the board which makes regulations in consultation with the minister.

This is a very subtle point, but basically the power is given to the people who have to do the administration, and not the minister. I have been surprised to hear very little reference to increased federal government power over the Canadian Wheat Board where there is a possibility of some difficulty with the rules of international trade.

This amendment returns much more power to the board of directors, and moves the minister onto the back burner. This may not be what our friends across the way are after, but I believe we must attain that objective if the Canadian Wheat Board is to be properly administered. That is why we will vote for Motion No. 11.

Motion No. 12 is much like 11. Moreover, in the motions that follow there are some things that overlap. That is why I will have far less to say about the following ones, for example, Motions Nos. 14 and 15. In Motion No. 14, the proposed amendment sets a limit for the mandate of the president to be determined by the board of directors, so in Motion No. 15 this should also be the board of directors and not the governor in council. We totally agree with this motion, which reduces the federal government's power to appoint someone to this position for an indeterminate period.

You can see that the same logic has been followed from the start and there is an attempt to give more power to farmers on the Canadian Wheat Board and the board of directors, and thus to move it a little away from the control of the federal government.

As for Motion No. 16, its purpose is to have the president implement measures no later than six months following the first election of the board of directors to include the Canadian Wheat Board as a signatory to the International Code of Ethics for Canadian Business. This, I believe, is self-evident. We will therefore vote in favour of this motion.

We shall do likewise for Motion No. 19, which is a consequence, or at least a corollary, of Motion No. 16, in which it is stated, as has already been mentioned, that the code of ethics governs the conduct of Canadian businesses abroad by ensuring that they do not exploit child labour and that they apply the same labour standards elsewhere as they do here. What this means, therefore, is that the Canadian Wheat Board must act as a good corporate citizen both here and elsewhere.

Now for Motion No. 17, the amendment on the absence or inability to act of the president, I think that this is a routine matter, this is normal. We will therefore vote for there to be a replacement when required.

Finally, to address Motion No. 18, where the amendment stipulates that the board members shall act in the performance of their duties with integrity and good faith, which I do not doubt. We will therefore vote in favour of this statement of good intention.

[Rick Borotsik, Progressive Conservative, Brandon—Souris, MB]

Mr. Speaker, once again I am pleased to speak to the amendments. We are now debating Group No. 4. In this grouping our party has two amendments. I will speak to those amendments as well as others. These amendments have been grouped together, as a number of them work in conjunction with each other.

There are two areas in this legislation about which I am concerned. One of the areas has been dealt with to a certain degree and we will get to it a little later when we debate the amendment with respect to the inclusion clause. Exclusion and inclusion are very serious components of this legislation and should be amended in order to improve the legislation.

The second area about which I have very serious concerns is the governing section of the legislation. There have been substantial improvements put forward in this legislation which improve the existing governance of the Canadian Wheat Board.

For those who do not know, the current governance of the Canadian Wheat Board consists of a membership board, a commission if you will, with a maximum of five commissioners. Currently there are three commissioners acting as the head of the Canadian Wheat Board. There is also an advisory board. The advisory board is made up of elected representatives, but the advisory board has absolutely no power. It is a eunuch. It simply advises not only the commissioners but the minister responsible for the Canadian Wheat Board.

As proposed, this legislation would improve that governance. In fact, there would be 10 elected board members out of the 15 who will comprise the membership of the Canadian Wheat Board. Ten will be elected and five will be appointed.

In our motion we have proposed a change to make it a fully democratic board of 15 elected members. There is no reason the government should have any objection to having a fully accountable board of directors elected by the producers.

A precedent has already been set with respect to this type of governance. The Ontario wheat board has a fully elected board of directors. It makes sense that a parallel organization, the Canadian Wheat Board, should have elected members.

The government will say because it has certain requirements and certain guarantees that are outstanding for the Canadian Wheat Board that it has to have five appointed members of which one is the chief executive officer. That is absolute hogwash. It is not necessary.

As part of governance there is a manager, a chief executive officer, referred to in the legislation as president. The president under this legislation will be appointed by the government and the minister.

I can say from experience I have had in the House over the very short period of time that the government has not given us an awful lot confidence in those people it will be appointing to the position of chief executive officer.

There have been examples of people who do not understand the business of being appointed as chief executive officer. This is not the chairman of the board. This is not a board member. This is the individual who is going to be taking a corporation from the year 1997 into the 21st century. Here is an individual who has to have an awful lot of business acumen, understanding of the business, understanding of the industry, understanding of trade arrangements and organizations in order for us to succeed as western Canadian grain producers.

This cannot be a Liberal patronage appointment, which unfortunately has been shown to happen many times in the past. I am very nervous of that situation. There is no reason why an elected board of directors cannot have the confidence placed in them to appoint and hire a chief executive officer. That is what these amendments speak to. They speak to the point that this chief executive officer should be hired and report to the board of directors who would hire him, not to report to the government and the minister who really have no understanding of what is happening to the Canadian Wheat Board.

I talk about governance. We have the board of directors and a chief executive officer. I have some further concerns when we talk about the current commissioners who are now operating the Canadian Wheat Board. They run under a very sheltered cocoon operation, obviously, having it as a monopoly corporation. It runs basically the same way now as it did in 1943.

I have with me a interview which was done by the current chief commissioner of the Canadian Wheat Board. It was given to the Manitoba Co-operator . I would expect that would be a fairly reasonable source and acceptable source by the members of government. It says Chief Commissioner Lorne Hehn said: “I said to the minister if the board and the minister want me to be there, I will be there for one year but not beyond that', Hehn said after speaking a Manitoba pool annual meeting.I am prepared to do it, be the chief executive officers, but the price has to be right”'.

I have some concerns about that because, quite frankly, what has to be right has to be right for producers and Canadian farmers, not what is right for a chief executive officer or for a minister of the crown. It has to be right so we can put into place the proper marketing measures to compete in a global society right now, to compete in a global marketplace where there is substantial competition.

So that speaks to these amendments, where in fact we should have a fully accountable elected board of directors and an appointed chief executive officer by the board.

Two other motions I would like to touch on. One is Motion No. 8. The reason I bring this up is I originally tabled this motion at committee and then withdrew it. It obviously found its way to the amendments here. I bring it to the attention of the House. It says “—rum at the meetings, which shall be at least two-thirds of the board”. That obviously means quorum, but when I read this I almost had unanimous consent of the committee.

However, the amendment is a legitimate and logical one. It speaks to a quorum being struck for the board of directors. It should be two-thirds board members and a ratio of two elected directors to one appointed director. For every meeting of the board of directors there has to be two elected members to one appointed member and two-thirds of the board present for a quorum. That makes good corporate, business sense.

I will be speaking against an amendment which is obviously not mine. It was an amendment put forward by the hon. member for Peace River. It speaks to the actual election of the board of directors and the criteria people must achieve before they can register a vote for the board of directors.

I understand where the hon. member is coming from because there are large and small producers. All producers should have a vote for the person they wish to have on the board of directors of the Canadian Wheat Board.

We will not be supporting the amendment. I appreciate where it is coming from and I understand why it is there. It has merit but it flies in the face of democracy. It should not be based on the number of bushels produced or the numbers of acres farmed. It should be that farmers and producers have the right to elect the board of directors.

In wrapping up on this section I do not know if the Parliamentary Secretary to the Minister of Fisheries would like to be the CEO of the Canadian Wheat Board. He seems to be heading in that direction. I have some concerns with respect to the appointment of the CEO.

In a brief rebuttal, let me say that a number of organizations and people are still very concerned about the inclusion clause. We will have a chance to speak to that in another category that is coming up.

[Susan Whelan, Liberal, Essex, ON]

Mr. Speaker, earlier today in the Chamber the hon. member for Skeena started to talk about the Liberal approach to managing and controlling all aspects of our economy. He referred to marketing boards that were set up by the Hon. Eugene Whelan.

It shows the lack of understanding of marketing boards of the member for Skeena. What was even more ironic was that he talked about the Liberal approach in the 1960s and 1970s. He should be aware that when Eugene Whelan became agriculture minister there were already over 108 marketing boards in existence in Canada, mostly provincial.

When the member talked about it being a Liberal policy, it is ironic that the provinces with a long history of Conservative governments also had a long history of marketing boards. There were 25 marketing boards in existence under the government of Bill Davis.

I want to ensure the member for Skeena knows what a marketing board is if in the future he wants to talk about it. I thought I would put on record that marketing boards vary in practice but the principle is very simple.

It is a system whereby producers, in this case the farmers in case the Reform Party does not know what those are, pool their products, decide on a cost price formula, when and how much to produce, how much to sell and at what price.

As was not understood by the member for Skeena, farmers have democratic control over a marketing board. They run it themselves. It is not forced on them. A marketing board for perishable products makes the most sense.

That is the difference. The member for Skeena did not understand that marketing boards are mainly for perishable products in Canada. Some products can be stored in a bin for years but that cannot be done with a pound of butter or meat. To produce a surplus of perishable products and assume that the market will take care of it is utter economic nonsense and wasteful.

“A marketing board is an efficient way of protecting domestic producers and assuring that there will always have a supply for domestic consumption”. The hon. member could have read that. It is a quote from a book published by Eugene Whelan, in case he has not had the time. It was given to him in 1993 to read.

He also talked about rotten eggs. Again it showed a lack of understanding of the industry. The incident he referred talked about the number of eggs spoiled. The number was quite small when one looks at the industry in context. It was only about a half of 1% of a year's production which under any circumstances is not bad for any perishable product. I challenge the member for Skeena to find another industry that did so well. It is quite impressive when we remember that we are dealing with a perishable product.

It is interesting to note that the person he referred to, Eugene Whelan, was not responsible for the storage facility but only for the legislation establishing the board. It is even more ironic that same person, Eugene Whelan, became the first agriculture minister in Canadian history not to have to subsidize the poultry industry. I thought that would be something the Reform Party would reward. I thought they would be happy to hear there was no subsidy under his leadership.

It is interesting how the Reform Party throws in comments and does not recognize the importance of marketing strategies or, in particular in this case, the difference between marketing boards for perishable products and the Canadian Wheat Board. The Canadian Wheat Board is guaranteed for all farmers.

To end my comments today, I wanted to say that the only rotten egg in parliament today was the member for Skeena.

[Leon Benoit, Reform, Lakeland, AB]

Mr. Speaker, that is a hard act to follow and I will try not to do so.

I will talk about Group No. 4. It contains over a dozen amendments to Bill C-4 which deal with a wide range of issues. The issues are so wide ranging that it will be very difficult to touch on half of them in the time I have. I am concerned about the fact that the amendments are not grouped in a way that would make debate a little easier.

The first motion I want to talk about is Motion No. 5 brought forward by the Reform member for Peace River. The member for Brandon—Souris already talked about this amendment. It was interested that he was quoted in a newspaper recently as saying he had found friends in the Liberals and the New Democrats but would never co-operate or find friends in the Reform. Yet here he is fully supporting the amendment of the member for Peace River. I appreciate the change of heart on the part of that member. I think it is progress.

The member for Brandon—Souris presented the case on Motion No. 5 quite well. I think I can leave it at that. He did a good job of explaining that amendment.

The next amendment I will talk about is Motion No. 8 which I put forward. The purpose of the amendment is to set out what a quorum would be on this partially elected and partially appointed board which it seems the Liberals are determined to give us. What Reform wants is a completely elected board. We think farmers will settle for nothing less. We are to get a partially appointed and partially elected board. The board will consist of 15 members, 5 appointed under Bill C-4 as it stands and 10 elected.

Depending on how quorum is set by the minister, I have concern that a quorum could consist of all appointed directors. In a case where a meeting is called and for some reason the elected members cannot make it to the meeting, we have nothing to assure us that a board of only appointed members could make serious decisions about the future of the board or about operations of the company.

I do not think this amendment could possibly be opposed by government members. It would ensure that we have a good quorum with at least two-thirds of the members, 10 out of the 15, and that we have a ratio of at least 2:1, two elected directors and one appointed. That is very important. We can then be assured that at least the elected directors will be there and will have their say at the meetings. I encourage the government to support Motion No. 8. It will be difficult to understand why It would not.

I will talk a bit now about Motion No. 9. It concerns the hiring and firing of the president-CEO. The way Bill C-4 amends the Canadian Wheat Board Act the minister would appoint the person to the position of president-CEO. It is very unusual for a president and a CEO to be the same person. It is very unusual to have the chief executive officer whose job is to run the daily operations of the company also sitting on the board as its president. It is extremely difficult to understand why the government would propose that type of a situation.

Let us look at the background, at the philosophy of wheat pools, for example. Members opposite often refer to what pools offer and how pools operate. If they looked at how pools and co-operatives operate they would know that no one but an elected board of directors would hire or fire the president of the board.

For example, delegates and directors of the Alberta Wheat Pool are elected by members who meet. First they elect a president. Then the same board of directors hires the chief executive officer. At any time they choose they can fire the chief executive officer. These people would never be the same two people. It is a situation which to some extent would involve a conflict of interest, having the chief executive officer who is to carry out the wishes of the board of the directors sitting on the board as president. Having one person filling both positions is extremely unusual.

If we look at the model set out by co-operatives and by the prairie pools we find that it is in complete conflict with what the government has done in Bill C-4, an act to amend the Canadian Wheat Board Act.

Motion No. 9 in the name of the member for Prince George—Peace River is an extremely important amendment. It is important that this is passed. I hope members opposite will understand the importance of the motion, especially those who so strongly support co-operatives as I do. Let us learn from what we have seen in co-operatives.

There are several other motions that I want to talk about, but I will have to limit myself in that I only have a few minutes. The next one is Motion No. 10. It deals with who should vote and how many votes a certain operation should have. We do not know how the voting will be set up. That will be dealt with in the original election under the regulations. That is a concern because it should be in the legislation.

The rules for voting should be right in the legislation so that we know how the voting will take place. That will not happen. The regulation will be set after the bill is passed as it surely will be because the government will ram it through.

A member of the NDP said earlier that a farmer that grows one bushel of grain should have the same vote as a farm that has a permit book and may be the sole means of support of three, four or five families. Many farms have one permit book for several families. That member said that a farmer who grows one bushel of grain should have one vote the same as a farm that supports three, four or five families.

It is nonsense. It makes no sense. That is why we have an amendment that would at least say that a minimum of 50 tonnes of grain have to be produced to be eligible to vote, and 50 tonnes is not much. A commercial farm would grow many times that. It is certainly not a number that would eliminate any farmers who are anywhere near being commercial farmers.

Another change that must take place in the voting arrangements is to make it so that farmers who do not have a permit book but who grow grains like wheat and barley that are under wheat board jurisdiction will have a right to vote. Many farmers have chosen not to use the wheat board so they do not get a permit book. It is a very deliberate move on their part. Why should they not be allowed to vote when it comes time to elect a director to the Canadian Wheat Board? The answer is very difficult to understand.

I have heard several members of Parliament from other parties say that is the way it should be. If you do not have a permit book, you should not be eligible to vote. Of course that will all be determined in the regulations and we do not know what will be in the regulations.

I am very concerned about the voting. I was hoping this bill would never get to a stage where there would be a vote. Maybe the government will see the error of its ways here and completely scrap this bill. It might happen. In my dreams it will happen. I suppose it is not very likely.

This piece of legislation should be scrapped because clearly it is not going to do anything to improve the Canadian Wheat Board. It is not going to make it any more accountable to prairie farmers. It is not going to reduce the power and control of this government and of the minister. I think that is another extremely important amendment.

Since I am getting an indication that my time is up, I will say that I have so much more that I would like to say to these amendments. If I have no more time, I will make some further comments when we get to future amendments. It is important that there are members of the Reform Party who can really identify with the farmers who will be affected by this legislation to speak out on these amendments.

[The Deputy Speaker]

Order. It being 5.30 p.m., the House will now proceed to the consideration of private members' business as listed on today's Order Paper.

Agreement On Internal Trade Implementation Act

[Leon Benoit, Reform, Lakeland, AB]

moved that Bill C-203, an act to amend the Agreement on Internal Trade Implementation Act, be read the second time and referred to a committee.

Mr. Speaker, it is a pleasure for me to rise to speak to my private member's bill which I believe will do an awful lot to remove barriers to trade between provinces within Canada and between businesses within a province.

I will give some background to this bill, I will speak on what Bill C-203 will do, I will talk about the importance to Canadians of implementing this bill, then I will do something very important and read from letters of support I have received from various institutions and individuals across the country.

The agreement on internal trade was passed in this House in 1994. It was signed in 1994 by this federal government and by all provinces and the territories. It came into effect in July 1995 and I took part in the debate that preceded the passing of the bill. I supported the bill. I did not think it had gone far enough, I did not think it was strong enough, but I supported many aspects of the bill as did the Reform Party. It was right to support it.

Many of our concerns were very legitimate.

The agreement came into effect in 1995, but what the agreement really did was set a timeline and a framework for future negotiations that would complete an Agreement on Internal Trade, that agreement which would remove most of the barriers to internal trade within the country.

Unfortunately, every timeline that was set in that Agreement on Internal Trade which was passed in 1995 has passed and has not been met. None of the timelines have been met. The dates that were set have passed. What we find is a situation where a piece of legislation which had good intent, which was passed by this government in 1995, has had very little positive effect on its stated purpose which was to remove the barriers to internal trade within this country. So it has not done the job.

A main part of the reason that it has not done the job is due to a couple of terms used in the agreement, particularly the term “agreement by consensus” between the provinces, the federal government and the territories, or between all provinces and the territories. This term “agreement by consensus” has been interpreted by this group to mean “unanimous consent”.

The way the provinces and the territories have been interpreting this term “agreement by consensus” is that every single province and each territory and the federal government must all agree to any change which would help complete the Agreement to Internal Trade.

My bill would remove that unanimity requirement that has been self-imposed by the board. It would instead put in place a mechanism which would require consent of at least seven provinces, including at least 50% of the Canadian population. That is a formula which is much more realistic and which will allow, I believe, the completion of this Agreement on Internal Trade. With the completion of the Agreement on Internal Trade will come removal of most of the barriers to trade within this country. I will talk a little later about the importance of that to Canadians.

Back to a little bit of background, I have had people say: “With what you are proposing”—not many, mind you; they have mostly been from the Liberal Party—“are you not letting the federal government be heavy-handed in this issue?”

In fact, that is not the case at all. It is not the case at all because again what I am saying is that only in cases where the provinces and the federal government and the territories together have not been able to reach an agreement could the federal government impose a settlement when we have had agreement of at least seven provinces, including at least 50% of the population.

Second, Bill C-203 would apply only to cases where the proposal falls within the federal legislative powers as established by the Constitution Act of 1867. That is the part of the act that relates to the interprovincial trade. Particularly, we are talking about section 91 of the BNA Act of 1867, which states that legislative authority of Parliament extends to the regulation of trade and commerce, and section 121 of the BNA Act which states that all articles of growth, produce or manufacture of any one of the provinces shall, from after the union, be permitted into each of the provinces.

Clearly, section 121 of the BNA Act says that it is the obligation of the federal government to ensure free movement between provinces. The federal government has abdicated this responsibility in particular for the last 80, 90 years and it has allowed one barrier after another, after another, after another build up so that we do not have free movement of goods in this country anymore. It has come to the point where people who run successful companies have come to me and said “It is absolutely ridiculous in this country when it is more difficult for me to move goods to another province than it is for me to do business with a company in the United States”.

I have also had people who run successful companies come to me and say “I have stayed in Canada as long as I possibly can. I want to be a Canadian. I want to do business in this country. But if I want to do business with all ten Canadian provinces and the territories, I can do it much more easily from a company based in the United States”. That is the situation we have today. It makes no sense. It is costing Canadians an awful lot of money.

I will mention some of the studies that have been done which have shown the cost to Canadians.

The Canadian Chamber of Commerce stated that a 10% increase in internal trade would result in 200,000 new jobs. With unemployment hanging around 9%, those 200,000 new jobs would be very important indeed. Of course, an increase in internal trade beyond 10% would mean even more jobs.

The Fraser Institute stated that removing interprovincial trade barriers would increase family income by $3,500 a year. The average family income would increase $3,500 a year.

The Canadian Manufacturers' Association stated that removing these barriers to internal trade would mean $6 million to $10 million more being put into the Canadian economy. That would have a huge impact.

I know I only have five minutes remaining, so I am going to skip over some of the things I was going to cover. However, I am going to refer to two studies which I believe must be referred to when we are talking about the complete lack of success of the agreement on internal trade that was passed in 1995.

A federal study leaked last May found that the agreement on internal trade only addresses 13% of the thousands of interprovincial trade barriers faced by the 50 companies who were taking part in this government survey. The study found that 56% of the trade barriers could be addressed if the agreement were completed. Only 13% had been removed, but 56% of the barriers would be removed if the agreement were completed.

We have to wonder why this government has not been more serious about removing these barriers. Surely that alone should indicate that this government should implement this bill. If it does not like the bill exactly as it is, then I say “Go ahead. Make the changes that you want to make to it, but put in place legislation which will implement the agreement on internal trade”. It is too important to Canadians to ignore.

Last spring the Canadian Federation of Independent Business asked their members the following question: Should the federal government take steps to ensure that the provisions of the agreement on internal trade are enforced without further delay? Of those who responded, 58% said yes, 21% were undecided, 10% were not interested in the issue and only 11% said no. When asked a question which directly relates to my private member's bill, only 11% said “No, don't do that”. Fifty-eight per cent said “Yes, and do it quickly”.

I would like to refer to some letters of support which I received from important groups in Canada.

The first letter comes from the British Columbia Chamber of Commerce. This letter is dated November 3, 1997. I sent a letter to a couple of dozen key institutions across the country and asked them if they would write a letter of support specifically for my private member's bill.

This letter is from John Winter, president of the British Columbia Chamber of Commerce. It reads: “The British Columbia Chamber of Commerce would like to commend you on your initiative to improve trade opportunities within Canada. Much has been made of the success Canadian businesses enjoy in a free trade environment within North America, and the opportunity to improve trade conditions in Canada is overdue. We support you in your efforts and wish you much success in passing An Act to amend the Agreement on Internal Trade Implementation Act.” That is the title of my bill.

That is from the British Columbia Chamber of Commerce.

From the Canadian Federation of Independent Business, Catherine Swift, CEO, a letter written November 4, 1997 in response to that same letter: “Thank you for your recent letter on Bill C-202, an act to amend the Agreement on Internal Trade Implementation Act. Small and medium size businesses in Canada have long supported the elimination of internal trade barriers and welcome your initiative on this matter.

“In your letter, you cited CFIB's recent mandate ballot survey which showed that 58% of the respondents supported the federal government ensuring that provisions to the agreement on internal trade are enforced without further delay.

“I have attached the full text of the question as well as two earlier member votes on related topics to your information.

“Please be assured that Canada's small businesses are supportive of your initiatives in this area”.

From the C.D. Howe Institute, I want to make clear up front that this letter is from Daniel Schanen, a real expert in this area. He does say, and I want to get to this first: “Our mandate as an independent institute does not allow us to support or disapprove of particular bills”. But the rest of his letter goes on to show strong support for the initiative that I have taken through this piece of legislation.

They also expressed the importance of the barriers to internal trade being removed in this country. So many of the letters really stressed their disappointment in the lack of action on the part of this government when it came to making some progress on implementing the agreement on internal trade, finishing the deal so that we have barriers to trade reduced and eliminated in this country.

We have the information from studies on the importance of removing these barriers to internal trade. The industry minister has stated on several occasions that he thinks this is an important issue.

I guess I have to ask why this same industry minister who again and again has stressed the importance has said, and I have a quote here on that, that maybe it is time that the federal government went beyond what it proposed to really do what it has a right to do and ensure that this deal is completed.

Every single province and every territory in this country said that if the agreement on internal trade is passed, the people of their provinces would be better off.

That confirms the information that has been received from studies and from the responses I have received from the letters I have sent out on this bill.

I appreciate the time given to me to present my bill and to make some key points on it. I look forward to the debate from other members on this bill.

[Walt Lastewka, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, it is a pleasure for me to speak on Bill C-203, an act to amend the agreement on Internal Trade Implementation Act.

This bill serves as a timely reminder of how important trade is to Canada not only in international but in domestic trade. From its very beginning, Canada has been a trading nation. Trade is the lifeblood of this country.

The well-being of Canadians depends on our ability to create and profit from competitive trading environments both at home and abroad. It was for that reason that the federal government and the provincial governments during 1993 and 1994 negotiated the agreement on internal trade.

The purpose of the agreement was to create a framework for continued co-operative efforts among governments to open up the domestic market. It established a set of rules and a work program aimed at ensuring the free flow of goods, services, people and capital and, more generally, governing trade and trade disputes between provinces and territories.

The agreement on internal trade came into effect July 1, 1995. It is no secret that there are problems with the agreement. From the start, the government recognized that the agreement was only a first step. We have accordingly consistently sought to bring other governments to agree to make it a more effective instrument for economic growth.

The Minister of Industry has at every meeting on internal trade pressed his provincial colleagues to ensure the work mandated by the agreement was done within the deadlines set. He has repeatedly challenged the other parties to the agreement to seriously consider ways to improve both its scope and the way it operates.

Recent studies and reports by business organizations such as the chamber of commerce and other observers have underlined many of the weaknesses in the agreement. They have pulled few punches in identifying the reluctance of various provincial governments to live up to the spirit or the letter of their commitments.

Most of these observers have identified the decision making process and the agreement, that is, its requirement for a consensus as a major impediment to progress.

This bill reflects an attempt to address that particular issue. The intent is understandable. The bill itself, unfortunately, is neither realistic nor practical.

As most hon. members will recall, last year we considered and passed the Agreement on Internal Trade implementation Act which this bill proposes to amend. The government introduced that legislation in 1995 because we were then and remain today firmly committed to making the agreement work.

The Agreement on Internal Trade and Implementation Act enables the federal government to meet its obligations under the agreement on internal trade. That legislation was necessary to give the government the appropriate authority and specific tools to act within its own areas of direct responsibility. However, it is most important to recognize that our Agreement on Internal Trade Implementation Act and the agreement on internal trade are quite different and distinct instruments.

The one is legislation by and for only one government within its own jurisdiction and powers. The other is a collectively achieved accord on how all the governments that are party to it will exercise their respective powers within their own jurisdictions. The agreement on internal trade was the outcome of a difficult process of negotiations between the federal government, the provinces and the territories during 1993 and 1994.

The authority of the agreement on internal trade does not derive from federal legislation. Rather, the authority of the agreement on internal trade derives from the commitments, obligations and undertakings which all governments accepted when they signed it. That is a fundamental point which the bill before us fails to recognize.

Simply put, no one party to the agreement on internal trade can on its own amend that agreement. That is what this bill is attempting to do.

There are therefore two main reasons why this bill is inappropriate. First, it cannot accomplish what it wishes to do, which is amend the agreement on internal trade without the agreement of all the other governments that signed it.

Second, it directly conflicts with the fundamental basis on which the agreement was negotiated, co-operation, joint action and national interest. The Canadian business sector has a legitimate expectation that the agreement on internal trade should deal effectively with internal trade barriers and impediments.

It has a legitimate expectation that the agreement should also deal with the burden of extra costs imposed by conflicting, overlapping and duplicate regulatory requirements. Ordinary Canadians have a legitimate expectation that the agreement should make it possible for them to live and work wherever they can be gainfully employed or wherever they are able to provide marketable services. All Canadians have a legitimate expectation that the agreement should make it possible for them to invest freely and conduct honest business freely throughout the country.

The agreement as it now stands does not deliver on those expectations. It is only a first step. The fact is that dealing definitively with internal trade issues is not a simple task.

It is easy to read through sections 91(a) or 121 of the Constitution and conclude that what is needed is bold and decisive action by the federal government; easy but simplistic and ultimately ineffective.

It is simplistic because unilateral federal action could not address some areas that are exclusively within provincial jurisdiction like labour mobility or local government spending on subsidies and other incentives. It is ultimately ineffective because it fails to recognize how this country works best.

Permanent, practical and effective change is best achieved when based on acceptance and co-operation among governments, not on the basis of legalism and coercion. All governments in Canada must work together to ensure that the national economy is strong, efficient and producing new products, services, jobs and growth opportunities.

It is important to that end that all governments be pressed to make the agreement on internal trade work better. The agreement belongs to all its parties. Its implementation is the responsibility of all its parties, not just the federal government.

While I cannot support this bill before us for the reasons I have outlined, I hope its message will not be lost by other governments and that the member opposite proposing this bill encourage in his own province that his own province be proactive and a leader in making sure that internal trade barriers come down.

In that regard, it is encouraging that the provincial premiers at their annual meeting in August directed their ministers and officials to complete the outstanding work of the agreement and to embark on a major expansion of the activity under it.

This government certainly can be counted on to continue to try to co-operate and work with others to strengthen and improve the agreement on internal trade. We look to others to work with us and be proactive to make things happen.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, it is with great interest that I rise to speak to Bill C-203, the purpose of which is to amend, and I will come back to this in detail, the Agreement on Internal Trade Implementation Act.

I am glad to see you there, Mr. Speaker, because I am sure that this is a topic of great concern to you and that you will listen closely to what I have to say. Two topics seem to have you terribly worried lately; obviously, the postal dispute, and the impossibility of delivering mail from your riding, as well as your inability to send out your seasonal greetings in the coming weeks. I know that this concerns you greatly, and that internal trade weighs just as heavily on your mind.

What is the bill before us all about? I will read the bill's summary, which explains this very clearly.

This enactment will give the Governor in Council—

This enactment will give the Governor in Council the power to bring a proposal into force under the Agreement if, although not having unanimous provincial consent, it nevertheless has the consent of two thirds of the provinces that have at least fifty per cent of the population of Canada. This would apply only to cases where the proposal falls within the federal legislative powers established by the Constitution Act, 1867 that relate to free interprovincial trade.

There are two parts to this bill: the first is the amending formula, and the second deals with the jurisdiction of the federal government in matters of interprovincial trade.

I will start with the first point. Right now, the approach is based on consensus, meaning that the agreement of all the provinces is needed before proceeding. It strikes me as very appropriate to ensure that the parties involved agree before the rules affecting them are passed. The big risk in the proposed formula is that the government would be imposing rules on the provinces with which they were not in agreement, and the odds are that, if these provinces were not in agreement, it would be because their citizens were not in agreement either.

When it comes to questions of trade, whether we are talking about opening up borders to international trade or about interprovincial trade, there is obviously very strong pressure to liberalize that trade, but at the same time there is also pressure to do so with respect for the particular characteristics of diverse industries. There is, for example, the whole issue of the colouring of margarine, which is of concern to a lot of dairy producers. We have to understand their concerns.

So, it is certainly not up to the federal Parliament to decide to impose rules without a consensus among the provinces involved. So, I repeat, the current practice, a relatively recent one, is to obtain the unanimous support of the provinces.

The second element of the formula proposed, which is in fact the seven and fifty formula, that is seven provinces and 50% of the population, was never accepted by Quebec. It had long claimed—all sorts of problems arose subsequently—to have veto power. However, no Bloc Quebecois member would agree in this House to this formula, which, in the case of interprovincial trade, would reduce the powers currently enjoyed by Quebec.

I have a warning, because I know the members of the government are listening carefully. There is a danger in interprovincial trade. This is my second point, and I will move to it now because it follows nicely. The danger is that little by little the federal government—and the supreme court has given it all the tools it needs—will claim that many sectors of interprovincial trade are under its jurisdiction.

We have long seen the Constitution from the standpoint of the sections that speak of sharing jurisdictions. There are two ways, however, that the federal government can use the Constitution to acquire new powers. There is public order and good government, and there is the Criminal Code. We are not concerned with the Criminal Code here, but I will explain how that would work anyway. The federal government would introduce criminal offences in a particular sector to claim that it had jurisdiction.

Whenever there have been disputes, the supreme court has always ruled in favour of the federal government. This happened again recently. There were a series of decisions recently—I will not look at all of them individually—which meant that everything was on the table if the federal government decided to go ahead and use this provision of good order or good government to take over areas of provincial jurisdiction with respect to interprovincial trade. This is undesirable and I hope the federal government will not resort to this. It knows very well that, because of the way the court interpreted the Canadian Constitution in its decision, there would be the potential for the federal government to centralize further.

Therefore, as I was saying, there are two aspects to the bill. The seven and fifty formula, which is unacceptable to a province such as Quebec, would also be inconsistent with the claims of a number of political parties, although in the case of the Reform Party, this is less and less obvious, that they support the unique character of Quebec, the new phrase we have been hearing.

This formula merely adds force to our argument that Quebec can been considered to have a unique character on paper, in a declaration with no constitutional value, but when it comes to introducing bills or making legislation, and so forth, that does not count. This has symbolic value, it is a piece of paper that can be given to Daniel Johnson to parade around with in the next election campaign.

This must not have any legal impact, though, and still less have any use as a means of recognizing more powers, or specific powers, for Quebec, never, never. It is clear that if the Calgary declaration were sold under that angle, it would sell even less well than now. That agreement is not out of the woods yet, but that is not what we are debating now.

Now back to the second aspect, which states that the seven and fifty formula ought to be used for jurisdictions currently belonging to the federal government. This is what I am explaining. The problem is that the federal government is then going to claim that other areas of jurisdiction belong to it, where interprovincial trade is concerned. We can pretty well bet that the supreme court would back it up, as usual. There is an old expression in Quebec, with which you are very familiar, which says that the supreme court is like the Leaning tower of Pisa, it always leans in the same direction.

In the case of interprovincial trade, once again they are nibbling away at the powers of the provinces—in the case I refer to, the powers of Quebec—so that the federal government from the heights of its great wisdom here in Ottawa can declare that it is in the best position to ensure the proper operation of government. They would say that good governance and law and order should be left with the federal government. The government would then gradually invade provincial jurisdictions. So we cannot agree on either count.

Now, as far as interprovincial trade per se is concerned, it would clearly be desirable to further harmonize all kinds of existing regulations. I am in a good position to comment on this, since I live in a border riding. Geographically, the riding of Témiscamingue is in northwestern Quebec, on the border with Ontario. Naturally, we do a great deal of trade.

We have a very serious transportation problem. There is all sorts of regulations, and trucking regulations in particular. In our riding, on the border, there is this company called Tembec Inc. Its trucks only have to travel a few hundred feet to cross the border but they are subject to a different set of standards regarding loading and so on, depending on which side of the border they are on. That does complicate things somewhat and there are serious problems.

But this does not mean we should give the federal government the power to decide what would be best for these people. Hopefully, the provinces will step up negotiations to improve interprovincial trade, in the interest of businesses, individuals, workers and ultimately consumers.

In some cases, it is easier to trade with a foreign country, and the United States in particular, that between two Canadian provinces. Everyone agrees improvements are required, but certainly not along the lines of the proposals contained in the bill before us today, as it would not be in keeping with the amending formula Quebec wants, it would not give it a veto. On the other hand, it would enable the federal government to avail itself of this means to help itself to more and more power in the area of interprovincial trade. In the end, this would lead, once again, to a greater centralization of powers.

For these two very valid reasons, we cannot support this bill.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, I rise today to speak to Bill C-203.

The bill before us proposes to amend the powers of the government to enforce the agreement on internal trade. Under Bill C-203 unanimous consent from the provinces will no longer be required to reduce interprovincial trade barriers.

Internal trade is an area of great interest to me. My background is in small and medium size business. My family have been historically involved in small and medium size business. Our family and our region in Atlantic Canada prospered under more liberalized trade both with other Canadians and with people around the world.

Currently 20% of our national income and over 1.9 million Canadian jobs are created by trade among provinces and territories. Trade between the provinces totalled $314 billion in 1995 alone. Recognizing that internal trade in Canada is a vital part of our economy, I am distressed that since the internal trade agreement was negotiated and implemented it has received very little attention and even less leadership from the government.

Working harder to eliminate interprovincial trade barriers might stop or at least slow the recent increase in the unemployment rate. Canadian consumers, Canadian taxpayers and Canadians looking for work are paying the price for inaction on reducing internal trade barriers.

The initiative on the internal trade agreement was brought forward by the former Conservative government in partnership with the first ministers of the day. In 1987 the partners reached an agreement in principle to negotiate an agreement on internal trade. In the spring of 1993 negotiations began with a deadline of June 1994.

Unfortunately this agreement has not had the effect its originators had envisioned for it. This is especially distressing when one reads the red book distributed by the government in 1993. In it the Liberals promised to urgently address the issue of internal trade if they were to form a government. Today Canadians still find the economy hampered by internal trade barriers which give the provinces protectionist powers that cost Canadians jobs.

The current agreement is fundamentally flawed. There continue to be differing rules for a wide range of goods and services and specifications for things as ludicrous as the colour of margarine to the standards that trades people must meet in neighbouring provinces. Self-governing professional groups have erected qualification and certification barriers that prevent mobility of the workforce between provinces.

The current agreement does not cover the $50 billion public procurement market involving municipalities, universities, schools and hospitals. A recent proposal to open this market was vetoed by the British Columbian government. Since the agreement contains no enforcement mechanism, when a province wishes to break the agreement it can do so without fear. These trade barriers are creating false economies, are creating higher costs for consumers, taxpayers and are hindering employment growth.

The Liberal Party has in its past fought free trade. Now it cannot get enough of it. One week it will sign a deal with Chile. The next week it will sign a deal with Israel. While we are supportive and have been consistent in our support of the principles of liberalized trade and have recognized its benefits, it is time to bring down the barriers that create more trade barriers between Newfoundland and Ontario than exist between Newfoundland and Chile or Newfoundland and Israel.

This is not an issue of partisan politics as members of each party recognize the importance of bringing down these barriers and ensuring that we further grow the Canadian economy through liberalized trade.

Since the Liberals negotiated the agreement they have continued to pass legislation that increases barriers to internal trade. The current Minister for International Trade, the government's latest choirboy for trade internationally, was singing a different tune just a short time ago when as minister of the environment he championed Bill C-29 which created internal trade barriers within Canada that are now being contested under chapter 11 of the investor state provisions of NAFTA. This represents a potential $350 million loss to Canadian taxpayers because of his ineptitude at the time he championed Bill C-29.

The former minister for international trade, now the defence minister, cautioned the member for York West in a letter dated February 23, 1996. He told the minister “Bill C-29 could have many adverse implications for Canadian trade without compensating environmental benefits”. The government is guilty of creating more internal trade barriers within the country, not eliminating them.

Bill C-29 created internal trade barriers and is inconsistent with our current international trade minister's philosophy du jour espousing the benefits of liberalized trade. Now the minister's trade policy contained in Bill C-29 has brought the lawsuit from Ethyl Corporation. It is one of three lawsuits now against the Canadian government from foreign companies under chapter 11 provisions of NAFTA.

Not only did the government introduce Bill C-29 but it also tried to push taxation barriers on the Atlantic provinces through the implementation of the HST. Tax-in prices would have done more to create internal trade barriers and would have cost more jobs in Atlantic Canada. It is completely contrary to the basic principles of liberalized trade the government consistently represents, at least in terms of its rhetoric. It is completely inconsistent in terms of its policy inaction.

The motion put forth by the member for Lakehead is headed in the right direction as it asks for trade barriers to be reduced. It has enabled the House to have a lively debate on the important issue of internal trade. The motion on its own is too simplistic to completely address the barriers surrounding internal trade. I fear that what is needed is leadership from the government on an issue that is all too important to be downsized.

The government has shown a propensity to downsize and offload responsibilities to the provinces in the race to fiscal responsibility. We cannot offload or downsize leadership. That is what I fear has happened with this important issue of internal trade.

The problems with this agreement are much deeper than unanimous consent of the provinces. This is an example of the need for an enforcement clause which I touched on earlier. Furthermore, the motion asks the government to unilaterally change the internal trade agreement without consultation with the provinces. It is this type of federalism that the Official Opposition has used at times to divide Canadians while our party, the PC Party, is trying hard to unite Canada.

The PC Party believes it is time to deal with this problem of internal trade barriers with a holistic approach. The jobs at stake are simply too important for the federal government to sit on the sidelines. We believe that free internal trade can be negotiated co-operatively with the provinces.

The government needs to provide courageous leadership on this issue. The government has demonstrated basically that it is not interested in playing that important and critical role with the provinces on these types of important negotiations.

Earlier this spring my party proposed making internal trade an integral part of something we call the Canadian covenant. Under the Canadian covenant the PC Party proposed forging a new and lasting federation with a new level of co-operation between the federal government and the provinces.

Besides health care and post-secondary education, the covenant would have focused on interprovincial trade. We support the establishment of a commission to regulate and enforce the rules of interprovincial trade. We need to negotiate with the provinces to harmonize provincial standards in areas of corporate and business registrations, professional or occupational certification so that the costs of doing business in this country are not increased but in fact are reduced. The PC also supports strengthening internal trade through the transportation procurement provisions.

In closing, interprovincial trade like international trade is vital to our economy. The current government has focused too little time on improving trade conditions right here at home.

The Canadian Chamber of Commerce estimates that a 10% increase in interprovincial trade will create 200,000 very necessary and important jobs for Canadians. It is time for a Team Canada for Canada and it is time that we demonstrate leadership and it is time that the federal government actually works hard to provide this type of leadership at this critical time for the Canadian people.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, I am very pleased to rise and speak on Bill C-203, a bill to amend the Agreement on Internal Trade Implementation Act.

I would like to congratulate the member for Lakeland for this initiative. I would like to congratulate our government as well for making some early moves in the right direction. As the parliamentary secretary indicated, more needs to be done, but I am very happy that we have started the process.

If we look at it from the point of view of economic efficiency, it does seem somewhat ironic that as we are breaking down barriers to trade internationally, we still do have some barriers to trade within our own country.

Within that context I wonder if we could talk briefly about the brewing industry. The brewing industry and the location of brewing plants in Canada has been one of those issues within the context of the internal trade agreement that has received some profile and some attention.

In my riding of Etobicoke North I have two very large breweries, a big Molson brewery and a big Labatt brewery. I have many dealings as a result of that with the brewing industry. When I speak with them we often discuss how the brewing industry in the United States has evolved. There are typically very large brewing plants in the United States in one location or two locations and they serve the domestic U.S.A. market and perhaps the market internationally. They tend to have huge plants and they capitalize on some tremendous economies of scale.

In Canada the brewing industry has developed somewhat differently. We have a number of smaller plants which are relatively large in size but compared to the megaplants in the United States, they tend to be smaller and they tend to be spread out across Canada. As I understand it, the reason that has evolved is that many provinces—including I suspect the province of Alberta, but I do not know that for certain—but various provinces have insisted that for the national breweries to do business in their province, they have restricted transport movements of beer. It really has meant that the brewing industry has been required to set up brewing plants in very many of the provinces. Presumably some of the major breweries have established plants in Alberta. Again, I do not have those facts in front of me.

If the barriers to internal trade are removed for the brewing industry, it would undoubtedly mean that some of the smaller plants across the prairies, in British Columbia, in the maritime provinces and in Ontario would shut down and a lot of the production would be consolidated into megaplants. I wonder if the hon. member for Lakeland would see that as a positive step and whether he would support it.

[The Deputy Speaker]

If the hon. member for Lakeland speaks now, he will close the debate. The hon. member for Lakeland.

[Leon Benoit, Reform, Lakeland, AB]

Mr. Speaker, I will respond to some of the issues which were brought up by the members who spoke. I do not have much time obviously to spend on the response to any one particular member. I will start by responding to the questions posed by the hon. member for Etobicoke North. He asked what would happen to some of the smaller breweries if barriers to internal trade were removed. He asked about Alberta specifically.

If the member wants to refer to Alberta, it would be important for him to know that the province of Alberta has led the movement to remove barriers to internal trade. Unilaterally it has made many of the changes which will be and should have been put in place by a completed agreement on internal trade. Alberta has done it unilaterally because it feels that this issue is important to Albertans.

There have been a few people who have complained about this unilateral action. They feel that Alberta should have waited until the agreement is completed. That is what my private member's bill would do. It would lead to the completion of the agreement.

Members who have called it simplistic obviously have not read it and thought it through. It is simple. It is a simple amendment, but it is not simplistic and it will do the job.

In terms of the breweries, many successful breweries are in fact micro-breweries, smaller breweries. I cannot say for sure that some would not close down as a result of removing barriers.

However, every province, each territory and the federal government, when they signed the agreement on internal trade agreed that there would be a net benefit to the people of each and every province.

That brings me to the comments made by the Bloc member. He was concerned that Quebec would lose its veto within the formula which would remove the unanimous consent requirement and put in place the consent of at least seven provinces having at least 50% of the population. His concern is completely unfounded. In fact, the Government of Quebec signed the agreement on internal trade. It agreed to a step by step process to complete the agreement. All my bill would do would be to allow for the completion of the agreement on internal trade.

The concerns put forth by the hon. Bloc member are completely unfounded because Quebec has already agreed to it, as has every other province and territory in the country.

Furthermore, I believe that Bloc members supported the implementation agreement which was introduced in 1995 and passed in 1996. This nonsense about Quebec losing its veto is completely unfounded. It has already expressed the desire to have this agreement completed and that is all my bill would do. It would put in place a more realistic formula for approval for each step in completing the agreement on internal trade.

The reactions of government members have been very vague in some ways. However, they did say they were concerned because the agreement on internal trade was signed by all governments in Canada, so how could the federal government alone make this amendment.

I would ask the parliamentary secretary if the government has even attempted to consult with the provinces and the territories to make this change or a change like this. I do not care if they use the exact method that I am putting forward. I do not care. I just want the job done.

The government has far more resources than I have in terms of coming up with a way of doing it. I believe it will work, as do members of these institutions who have studied the issue in some depth. They agree it will work.

I do not believe it is simplistic. I believe it is simple. The concerns the government has expressed are completely unfounded. I will use some quotes from Liberal ministers in the last government to back that up.

One is from Alan Toulin, writing in The Financial Post , October 25, 1996. He referred to the minister from Edmonton West hoping for agreement on internal trade in electricity. She also raised the possibility that Ottawa would use its constitutional powers to manage the country's economic union.

That would mean a more active federal government, a role in bringing about deregulation for that minister and the Minister of Industry.

On February 25, 1997 the Minister of Industry spoke to a group of Edmonton small business people at a small business conference. He said that from his point of view it would soon be time for the federal government to consider alternative strategies. To say that he was disappointed, angry or frustrated is not only how he felt but an understatement. Being this far along into the agreement with so little progress to show indicated to him that it was certainly time to re-examine the strategy.

I will close with that. I had several quotes from constitutional experts. I would be glad to table them if I am requested to do so. I thank members for their input. I thank them for their clear support in dealing with the issue. It was unanimous, I believe. If government members do not believe my bill is the best way to go in this regard, I encourage them to come up with their own and I will support it wholeheartedly.

[The Deputy Speaker]

As no other hon. member wishes to speak, and the motion was not selected as a votable item, the hour provided for the consideration of Private Members' Business has now expired and this item is dropped from the Order Paper.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Mr. Speaker, on October 24, 1997, I questioned the Minister of Human Resources Development about the fact that the matter of the use made of the surplus of billions of dollars in the employment insurance fund should be included on the agenda of the next federal provincial conference.

We must not forget that, last summer at St. Andrews, the premiers decided that there were two things the federal government had to do about employment insurance. It had to lower contributions and improve the living conditions of workers who are between jobs, that is unemployed people receiving benefits.

Since then, there has not been a peep out of the federal government. The minister told us that the agenda was not his responsibility, it was the Prime Minister's. Today, we have reached that point in the autumn when—and we can see it at the InfoCentres—in Shawinigan they are getting calls from all those who are dissatisfied with the employment insurance reform. Our riding offices are systematically flooded with calls from people who say they can no longer get through.

In this wonderful federal system, it used to be that each Canada employment centre could provide answers to those it served. Through some incredible coincidence, it was decided to centralize everything in Shawinigan, in the Prime Minister's riding, and nothing works any more. There is no one to answer the phone. People call and call, but the line is always busy. This is example of the contempt shown by the Liberal government, which did not heed the message sent by the public during the last federal election.

Several Liberal MPs from the maritimes lost their jobs here. They were replaced by New Democrats or Conservatives because the public sent a clear message to the government that the employment insurance issue had to be reconsidered.

People do not call it employment insurance. They still talk about unemployment insurance. They know that the new program is not a guarantee of employment, but a guarantee that they will have increasingly less money when they find themselves between jobs. They want to know whether the government is prepared to lower the requirement of 910 hours of work for first-time contributors, such as graduating students or women who re-enter the labour market. Would it be possible to lower this requirement to a more reasonable figure, so that people will not give up?

Would it be possible to change the fact that, at the end of every 20 weeks of collecting employment insurance, people will see their benefits diminish by 1%? It means that if someone is starting this fall at 55%, he or she will get 54% in 20 weeks. If that person needs to rely on employment insurance again next year, the same thing will happen. The clock is not set back to zero. This means that in three years, seasonal workers will find themselves with 50%, while a person who lives in another region and who does not have to rely on employment insurance on a regular basis will get 55%.

Is there any possibility that the federal government can promise to put this issue on the agenda at the first ministers' conference that will be held in December, as requested by the Quebec premier and the other provincial premiers last summer? That would tell us something about this government's ability to show compassion.

[Walt Lastewka, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, I would like to respond to the hon. member's question by reminding him, and the Minister of Human Resources remarked on this recently, that the last federal budget and the main estimates already contain a great deal of information on the employment insurance account.

That said, there is no great mystery regarding the employment insurance account reserve. A reserve is necessary since it makes it possible to apply more stable premium rates throughout the economic cycle, thus making it possible to avoid increasing them in a recessionary period. In addition, the reserve makes it possible to ensure that there are sufficient funds to pay benefits when they are most necessary.

Let us recall for a moment what happened in the last recession. A $2 billion surplus in the Employment Insurance Act turned into a $6 billion deficit in two years and it was necessary to increase premiums by 30% in what was already a difficult time for job creation. That is no time to increase premiums. Consequently the government believes that it is wise to establish a reserve in the employment insurance account.

The size of the reserve varies continually. It increases and decreases depending on the rate at which benefits are paid out. The reserve is currently estimated to contain some $12 billion. However, this amount is to be reviewed and the government will soon be announcing its decision in this regard.

It should be remembered that the funds are kept in an account in anticipation of future expenditures that might be incurred under the program. The interest is credited to the employment insurance account. As indicated in the main estimates for 1997-98, interest this year totalled $345 million.

The employment insurance premiums of workers and employers make it possible to provide income protection. That is very important for persons who unexpectedly lose their jobs.