Mr. Speaker, would you add another minutes for this intrusion and please make it 13 minutes and 20 seconds. These people want to rush things through in such a dictatorial undemocratic fashion. They have used closure more times than the previous government, which is not democratic. Now I am off on a tangent which I will take a minute to do.
When you are in opposition you have the rules of the House which are here to protect the interests of the minority. Obviously the Liberals have such a strong majority and they are representing the wishes of those people who put them in here. But for the protection of all Canadians and all provinces the Liberals have to take the time and give us time to be heard. They have to allow us to tell them what we think is right or wrong about a bill. They have to give us the opportunity to point out what we feel on a constructive basis could make the bill better.
If they do not have the integrity or the fortitude to sit there and listen, then they are not really interested in the people of Canada; they are interested in themselves. They have no place to go this afternoon. They have nowhere else to go except for here where they can sit and listen, and that they will do at least while I have the floor for another 11 minutes and 20 seconds.
This is meant to be a democratic institution. I wish government members would recognize that just because they have a majority they do not have the right to trample over our rights in the minority. We have to be heard. We insist on being heard. The games this House leader plays and the way the Liberals fool around with the government orders with no notice, a lack of notice on this bill. Our chief critic is not here. He is not able to tell the people what he really thinks. He has been in the standing committee. He could shed a heck of a lot more light on this bill than I could.
I have some experience with banks and financial institutions so I feel qualified as a businessman to speak on this bill. I will get little
more personal if not as technical on this bill once I have read this letter which was sent by my colleague from Okanagan Centre to the Secretary of State for International Financial Institutions. This is the kind of work that Reform Party members do. It is a sample of the kind of hard work that Reform members of standing committees have done.
My colleague from Capilano-Howe Sound sits on the Standing Committee of Finance and has been our chief finance critic. He has made a number of valuable interventions in standing committee. They have been good, open, democratic and non-partisan suggestions. Here is an example from the member for Okanagan Centre. I hope the government listens to what he has to say. The reason I want to read this into the record is to show Canadians how things work in Parliament. It is not just debate and question period. For the media and for a lot of people it is just question period, it is theatrics. The real work is done right now on debate like this where people get up and put forth their arguments for or against a bill. Then the bill is sent to committee where people come forward as witnesses and argue their points of view, how they feel a certain bill will impact on them. And then there is the work that gets done behind the scenes.
Here is a sample of some work behind the scenes, a letter to the Secretary of State for International Financial Institutions written by the Reform member for Okanagan Centre:
Dear Minister,
As the Reform Party critic for financial institutions, I wish to express a concern that a growing number of small business people and I have with Bill C-82, an act to amend certain laws relating to financial institutions.
Specifically our concern rests with clause 55, section 451.1 subsections (2) and (3).
While 459.1(1) states explicitly that no bank shall impose undue pressure on, or coerce, a person to obtain products and services, subsections (2) and (3) appear to contradict 459.1(1) by allowing the banks to do just that. In our opinion these provisions for tied selling give the banks considerably more power than they enjoy now.
As acknowledged by your officials, the definitions of tied selling and coercive tied selling are numerous. While sectors do practise tied selling or product bundling, we feel caution must be exercised where coercive or pressure tied selling is concerned. Any legislation which could be interpreted as giving the banks the ability to coerce or exert pressure is grievous. Mechanisms such as conditions for preferred rates on loans and/or products and services which unduly influence the consumer to consolidate assets within one financial institution is not prudent in our opinion.
While we understand subsections (2) and (3) are considered to be interpretive and are intended to assist the courts, the Reform Party feels it would ultimately be in the best interests of all concerned to delete (2) and (3) thereby allowing 459.1(1) to stand on its own merits and to remove any chance of misinterpretation which would give the banking sector grounds for unfair advantage. Any resulting confusion can be adequately clarified by the provisions set out in 459.1(5) via the regulatory powers of the Governor in Council.
Barring this amendment, we would like to suggest an alternative amendment to Clause 45 and Clause 55 be deleted.
We are extremely aware of the time constraints inherent in the Bank Act which emphasize a preference for speedy passage of Bill C-82 through the House. The Reform Party does not wish to unduly delay the passage of this Bill. However, since a growing number of small business people, including members of the casualty and property insurance sector, share our concerns, I feel it would be irresponsible of me as a critic to advise our caucus to support Bill C-82 as long as Clause 55 stands as is.
We would like to see an amicable resolution to our concerns and wish to express our support for the merits of this legislation. Our main objective is and will always be to ensure that the integrity of our financial institutions remains intact and the interests of the consumer and the small business person are balanced with the interests of the financial sector.
I ask that you give fair and reasonable consideration to these concerns.
It is signed by the Reform member of Parliament for Okanagan Centre.
As members can see, our main concern with this bill lies in that aspect which controls tied selling and the difference between that and cross selling. One must be very careful when passing legislation and making laws that one does not step on people's toes or infringe on the rights of the corporation or the individual.
Banks are in a position to offer a lot of services. However, when looking at the size of banks and the number of people who are dependent on them, there has to be in anyone's mind some concern that legislation is not passed that allows the banks to have an unfair advantage over smaller or specialized businesses. That specialized business may be a large insurance company which offers just one service. It is not in a position to cross sell its product or offer volume discounts unless a person takes out a bigger life insurance policy or leases a more expensive vehicle or something like that.
When these smaller businesses are involved in their own specialized niche, it is important that when dealing with the banks that legislation is not imposed that gives the banks more power than the other financial institutions and investment dealers raising money, who can be offering chequing services and who cannot.
I have heard arguments from people who are anti-bank or bank bashers who say that the banks can get into any business they want. They can lend money for any purpose they want, provide insurance services or provide leasing facilities or whatever. We should then allow other people like investment dealers or other institutions to get into the banking business.
They do not like that so why not allow that so that we can have these specialized businesses if they have sufficient capital to offer other services? It seems to me that insurance companies have sufficient cash around. They could be in the deposit taking business, chequing business or credit card business which is a big business. We notice in the the Eaton's bankruptcy application that the most successful portion of its business is the credit card business and it is highly profitable.
We are trying to review the Bank Act, trying to make it fair for consumers and, at the same time, not make it punitive for the banks. We have to make sure that while one is applying for a loan for a house and the bank is approving the mortgage, it can suggest
one may need insurance for the house, so while one is there the bank might like to show its package.
The problem is how can one be inside that room or how can we pass legislation that puts one inside the law inside that room? We do not know what the bank manager or the account manager is saying.
The manager is telling the customer that the bank is giving him or her a mortgage. There is a big difference between your mortgage is approved, you have the proper credit facility and you know what, we can offer you insurance. Here is our package and I think it is a heck of a deal. You should take a look at it. That is okay and is cross selling in my mind. However, if the manager says that your mortgage is approved if you also take this insurance policy on the house, they come together, that is tied selling. That is not right. That is coercive. That is undue pressure on the consumer.
I feel that a lot of my intervention today was technical in nature, but I wanted to tell Canadians that a lot of work goes into bills like this. A lot of different people with different points of view make contributions. It is not easy: tied selling, cross selling, the difference, who is inside that room, how do you know.
Although the intent of the bill is is necessary and we agree with the majority of it, the one area that we are still unhappy with is the area of the tied selling in that clause.
Consequently, I move:
That the motion be amended by deleting all the words after the word "that" and substituting the following therefor:
"Bill C-82, an act to amend certain laws relating to financial institutions, be not now read a second time; that the order be discharged, the bill withdrawn and the subject matter thereof referred to the Standing Committee on Industry".
We are very concerned about that one area, tied selling versus cross selling. As I said earlier in my speech, the Bank Act must be clear and concise in its language so that people can interpret it without ambiguity.