Mr. Speaker, I am pleased to speak to Bill C-5, an act representing co-operatives.
Canada's history respecting co-operatives dates back to the mid-1800s with the formation of the Farmers' Mutual Fire Insurance Company. This was a result of the recognition by farmers that they too could have the same security in producing and marketing their products as seen by successful large businesses. The farmers decided to band together to gain better control over the marketing of their products and purchases. This was the birth of co-operatives in Canada.
The PC Party is pleased to support this legislation. Let me highlight some of the main characteristics of Bill C-5.
Bill C-5 redefines and widens the definition of co-operative basis. The principles of co-operative basis date back to 1844 and were set out by the Rochdale Society of Equitable Pioneers in England. These principles formed the basis of most Canadian provincial legislation for over 50 years before they were adopted by the federal government in the Co-operative Associations Act.
The new definition under Bill C-5 is in keeping with the 1995 statement on co-operative identity issued by the International Co-operatives Alliance and sets the tone for all proposed changes to the act. The new definition includes the principle of open membership. There is also some flexibility added to the one member, one vote principle with regard to delegate voting.
Furthermore the principle of member funded investment is expanded under Bill C-5 in order to provide for co-ops issuing investment shares. The principle of using surplus funds to extend the operation of co-operative enterprises is also added. Finally, the principle of education is included.
Bill C-5 makes changes to the rules governing incorporation. It permits co-operatives to incorporate provided they operate on a co-operative basis.
The act currently requires a memorandum of association for the granting of incorporation status. This memorandum is submitted to the minister. He then decides, provided the application meets all technical requirements and conditions, to either grant or deny the right of incorporation. This paternalistic approach works against the co-operative philosophy of group decision making.
With Bill C-5 they will be acting under the same principles of the Business Corporations Act of incorporation as a right and not at the discretion of the crown. The proposed system is simpler and would streamline the administrative practices. This would also reduce the costs currently associated with incorporation for all parties.
Bill C-5 introduces the concept of natural person when describing co-operatives. As a result, they are awarded the same rights and privileges of a natural person. This is instead of detailing the various rights, powers and privileges individually. It is also in keeping with the same rights now awarded to business corporations and mirrors the powers some provinces already offer co-operatives.
Record keeping under Bill C-5 is simplified and streamlined. This again is in keeping with similar rules found in the Business Corporations Act.
Bill C-5 simplifies the rules governing amalgamations with other co-operatives or corporations. For instance, Bill C-5 will allow provincial co-operatives to merge with federal co-operatives provided that the end result is a federal co-op.
Furthermore, co-operatives will have similar rights to those of business corporations under the Canada Business Corporations Act. When applying for an arrangement, the courts will have the power to order an arrangement or reorganization and not the crown. This is a change from the current situation where members apply directly to the minister.
Bill C-5 also includes provisions specifically for worker and housing co-operatives. Currently they are governed under general rules in the existing act. The industry has identified several gaps in the current legislation which does not address the needs of these two types of co-operatives. Bill C-5 attempts to resolve this problem.
In conclusion, I am pleased to support Bill C-5. I believe that it will benefit co-operatives and in turn, millions of Canadians.