moved:
That an order of the House do issue for copies of all documents relating to the Royal Canadian Mint building a coin plating plant in Manitoba.
Mr. Speaker, I am absolutely delighted that finally we have a venue for an open and parliamentary debate on this issue.
Those who have been following this story know that it has been almost a year now since this story hit the fan, so to speak. It is a situation where approximately 100 jobs in my riding are being jeopardized by a decision of the government to build a coin plating plant in Winnipeg, the back door of the Minister of Foreign Affairs.
I might also give another quick little political plug here because I think it is very appropriate. I have a strong suspicion that if the plant I am talking about, the private enterprise plant Westaim Corporation, were in a Liberal held riding we would not be discussing this right now. I do not think the issue would have gone this far. That is just a suspicion I have, based on my observations of the way this place works and what I have seen happen around here in the last few years.
Let us get down to the actual issues. The motion is for the production of papers. The motion specifically says that we want to have the papers released that will finally show the truth of the decision making process on this issue.
I have in my speech, which will be taking place in the next few minutes, a number of questions which I would like to have answered. I am just conjecturing here but I believe there is probably already a canned speech ready for the parliamentary secretary. My hopes of getting these questions answered is somewhere between zero and nothing. I want to pose them anyway and then I am going to urge members of this House in the interests of truthfulness, disclosure, openness of government to support the motion since if there is nothing to hide then the government should be eager to have everything out in the open so that the truth can be known.
If they vote against it, we can only conclude that the motivation must be that they want to deal in innuendo and in half truths or non-truths in order to justify their actions.
That is a big challenge for these Liberal members. I think they need to very seriously consider what the implication of their vote is. If they say no, it is really equivalent to the shredding of papers in the Somalia affair. It is a possibility that we can have the non-disclosure of all this information. That is really all we are after. Let us have the facts.
The other thing which underlies this question is that government decisions, especially as pertaining to the expenditure of money and the operation of the business of government which includes crown corporations, the mint, should be made prudently and be based on true facts. The decisions should be done wisely.
With all due respect, humbly I submit that some of the facts of the case here have been quite systematically ignored. I want to see what those facts are.
Very briefly, the government proposed last year to build a coin plating plant in Winnipeg. The cost at that time was projected to be around $30 million. Since then there have been two other numbers that have been publicized, $31 million and $38 million. We do not know at this stage exactly what the final cost of the plant will be. However, we do know that it is a plant of about 56,000 square feet with a capacity for producing plated coin blanks of approximately one-third of the capacity of the Westaim plant in my riding which is at issue here.
The other issue is the question of savings. In a press release last October it was said this would also lead to savings. The first number touted was a saving of $9 million per year and the second figure given was $9.5 million per year for a total saving of between $18 million and $19 million in a two year timeframe.
This is not a saving at all since moving the job from one location in the country to another at the expense of one and giving it to another is not a real saving. Furthermore, the savings could have also been achieved simply by continuing at the original location.
I believe this decision was based on the incorrect answers to three questions. First, is there security of supply? The government said no. I and the people in my riding and the Westaim Corporation emphatically say there is security of supply.
Second, are there cost savings? As I indicated in my introduction, I will talk more about the real and perceived savings and how they can be achieved.
Third, should the government be in business competing with existing businesses and threatening them? This is a philosophical question. I am not sure we will get the answer from the papers but it is one which also demands an answer. Should government be in an industrial process business?
To the question of security of supply, Westaim Corporation has been a major supplier to the mint since 1961, albeit at that time under a different corporate name. It is the same plant, the same organization and it has evolved over time. Now it runs under the name of Westaim.
In 1961 the corporation began producing nickel strip for the 5 cent coin. We call them nickels because they are made of nickel which came from the Westaim plant in my riding. In 1968 it began supplying the blanks for the dime, the quarter and the 50 cent piece. We all know what high quality coins Canadians have, so there is no question about the security of the supply and the quality of the supply. The coin blanks are pressed into actual coins by the mint which is a proper function of that crown corporation.
Westaim Corporation has subsequently supplied all the blanks for the loonie. Everyone who has a loonie in their pocket is dragging around metal that was produced in my riding. I want everyone, especially Liberal members, every time they look at a loonie or spend one to think of the wonderful riding of Elk Island just out of Edmonton, Alberta because that is where it originated.
The nickel strip portion of the two dollar coin is made at Westaim in my riding, so we have a large contribution to the coinage of Canada. Westaim in its coin production has been a solid business for over 30 years. It is doing just fine. For anyone to imply that the security of supply is at risk is totally incorrect. This is an international company. It produces coin products for markets all around the world, including recent large contracts to China and Brazil. Besides supplying Canada's domestic market it is a large exporter, thereby helping greatly in Canada's economy. It also does high tech research and production.
What really intrigues me, since my uncle died in a fire accident, is that Westaim produces a very high tech biomedical, totally sterile dressing for burn victims. It markets this all over Canada and the United States. It is an expensive but very effective product. It is very good at it. It has a research department in advance display technologies.
Recently it announced a breakthrough. We all have these little desktop computers. It could be that very soon computer manufacturers will be buying these thin screened, multicolour displays from Westaim Corporation in Fort Saskatchewan. It has excellent surface engineered products.
It recently announced a breakthrough regarding some fine powder materials which are used in the production of these high tech rechargeable batteries that all of us have in all our electronic equipment.
Does that sound like a business that is not able to give a secure supply? I guess not, so my contention is the decision was made based on less than perfect facts.
With respect to the security of supply and an answer to some of the things the minister said, even in this House as a response to questions that I raised and also that members of the other parties raised, Westaim has offered to the mint, if it is really concerned about it, to actually sign a contract, to dedicate the production from one line to the mint.
In other words, it is ready to say if at any time the mint wants to run the same kind of production it will be able to get out of its Winnipeg plant it is available right here and right now. That is because there is a worldwide oversupply in this market.
It just boggles the mind when one wonders why the government is trying to get into a business in which there is a present oversupply and in which there is not a foreseeable future of increase since we are moving more and more to electronics, credit cards and soon we will probably have cash cards. Coins are not an ongoing growing industry. They are level at best, with peaks admittedly.
When the Europeans bring in the new Eurocoin, zippo, there is a big demand for large coins. Canadians decided to have a $2 coin. Suddenly there was a demand because from zero the whole country had to be supplied with all the coins needed in that denomination.
Now that the loonie is in production and has been for over 10 years, the $2 coin now for a few years, the amount of production required to replace the coins that are lost or hoarded is not anywhere near what it is when a new coin is introduced. It is not a matter of the government getting into a business for which there is a huge ongoing and increasing demand. It is one where really what it is doing is upsetting the market and intruding into a business that is currently totally adequately covered by Westaim Corporation in my riding.
I say parenthetically with respect to the offer of the one of the three lines in the Westaim plant, the minister made a false statement in the House on March 24 this year when he said that the president of Westaim refused this offer. That is wrong. The president of Westaim made the offer. Again, I think we need to deal with actual facts when making these decisions.
Let me get to my second question, cost savings. They claim there will be a saving of around $9 million to $9.5 million per year. The fact is that only a small portion of that saving can be attributed to the fact that they will be producing their coin blanks in-house instead of purchasing them from Westaim. The largest component of that saving is due to the fact that they are changing from a nickel base to a steel base for their coin blanks.
Just the change in material and the cost of the process would produce this change and if they were to simply enter into a long term arrangement with Westaim, that saving could be achieved, just as with their new plant in Winnipeg they are proposing. There is only one difference, that the saving could be achieved almost immediately instead of waiting for two years until this plant is in full operation. At least we hope it will be in full operation.
It will be a brand new untested plant and, as with all new plants, it will have start-up pains. Therefore instead of saving $9 million to $9.5 million per year starting in the year 2000 or later, we could save that right away. There is another $18 million.
The minister in the House said this is not going to cost the taxpayer anything. That is not true. The mint is a crown corporation. If it makes money that money accrues to Canadians. If it looses money that is money that is lost to Canadians. If it reduces its total net profit that comes essentially and eventually from the pockets of the taxpayers of this country.
I submit that if we take the price of $38 million for the plant and $9 million a year for two years in savings, we are looking at a total of $56 million that the mint is expending when if it simply stayed with the present set-up there would be $56 million less to spend which is money saved and equivalent to money in the taxpayers' pockets. When the minister says this is not going to cost the taxpayer anything, it is not so.
This comes to my next topic which I am not up to yet but these things overlap a bit. They claim to be making money but the fact is they will not be making very much money if they are not going to compete internationally. The minister said we were not going to compete internationally. If they are not going to I do not know where they will get the money to provide all the domestic needs in this country. Unless we get into the business of issuing a new coin and a new denomination every other year there will not be that big domestic demand. Either they are going to contradict what the minister said and compete internationally or they are not going to make any money.
Furthermore, if the claim they will be making money it is inevitable that they will be making it at the expense of an existing corporation, a taxpaying corporation in this country. Any business they get which will allow them to make money will be money taken directly away from Westaim Corporation in my riding. I think that is wrong.
I have already spoken about the premise of increasing demand. Frankly, the documentation available shows that not to be so. That is not correct information. There is of course a present peak in demand for coin production because of the Eurocoin but when that passes it is expected to level off and, as I said before, the excess of supply in both plated and non-plated coin products is somewhere in the neighbourhood of between 30% and 50% which is the excess of supply right now. It is absolutely foolish to be getting into this business.
Let me address my third question. Should the government be in the business of competing with business? My answer is a hearty no. It may not do this. It is an affront to our concept of justice and decency for the government to use its clout to compete directly in a business with private enterprise. Would we allow if it were to say let's start a factory to build cars and compete with the car manufacturing places? What about a used car lot? Would anyone buy a used car from our Prime Minister? I do not know.
What kind of businesses is the government going to get into? It may not compete directly. Furthermore, a recent bill in this House proposes to give the mint not only additional borrowing powers but additional borrowing powers from the consolidated fund. It is terribly unfair to have business A run by the government being able to use taxpayer money directly borrowing from the consolidated fund in order to compete with a private enterprise firm that is doing very well, thank you, as long as the government butts out and keeps out of this business. It has no business intruding there.
There is also a very great contradiction. It is the policy of this government to not compete with business. We have noticed how it has been privatizing. NavCan is an example. All the airports in the country are being privatized. Even some components of the military operations are now being put out to contract for private involvement. We also have the government printing operations.
There are many examples of it. It is getting out of the business of being in business in order to let private enterprise do its thing. We already have private enterprise being very successful. The government is incorrectly intruding in it, in violation of every decent principle that we could possible think of.
I strongly urge the government to vote in favour of this motion of the production of papers. When the facts are disclosed and truly known, and when we look at the contradictions in the debate so far, because there are some real sincere questions, hopefully we can rationalize this and even at this late date we can stop the government from this inappropriate intrusion into private business.