Mr. Speaker, I rise today to speak on the amendment moved by my hon. colleague for Mercier during debate on Bill C-53, an act to increase the availability of financing for the establishment, expansion, modernization and improvement of small businesses.
My colleague's proposed amendment reads as follows:
That Bill C-53 be amended by adding after line 22 on page 2 the following new clause:
“2.1 The purpose of this act is to increase the availability of financing to small businesses, which would not otherwise have access to financing.”
To be better prepared to speak on this bill, I asked that a poll be conducted in my riding of Rimouski—Mitis. Nearly 300 small and medium size businesses responded, answering a dozen or so questions to help us get a picture of their situation on a day-to-day basis.
Certainly, we would have hoped for a rate of participation higher than 25%, but we must understand that, generally speaking, small businesses and extremely small businesses often do not have enough staff available to respond to all such inquiries. Much of their time is apparently taken up by mandatory paperwork; so, more often than not, when they want to participate in a democratic process like this poll, they do not have the time or staff to do so.
Something interesting came out of the information we gathered. More than 55% of the small businesses in my riding have been in operation for over ten years; 15% have been in operation between six and ten years; 25% between two and five years, and about 5% less than two years.
It is also interesting to note that 50% of these businesses are managed by men, 20% by women and 30% jointly by men and women.
The number of small businesses started by women keeps growing. In fact, where previously 14% of small businesses had been in operation for more than 10 years, nowadays 32% have been in operation for less than 2 years. What this means is that women are setting up more and more small businesses, which in turn create jobs.
Small businesses are a major source of job creation and economic development in our regions.
Respondents were asked how easy it was to get financing, based on their opinion or experience or that of their neighbour. Eighty-five per cent of them stated that it was difficult or very difficult to get financing at a reasonable cost, based on their own experience and that of other small business operators.
For those that said it was difficult or very difficult to obtain credit at a reasonable cost based on their own experience, we checked to see if there were striking differences between their perception of their own situation and their perception of the situation of others. Ninety-one per cent of respondents thought the situation of others was the same as their own or worse.
Moreover, 68% of business owners who said it was easy to obtain credit, based on their own experience, thought it was more difficult for other owners.
We were intrigued by one thing in particular. Knowing the importance of small business to the economy of both Canada and Quebec, the government is now proposing to amend the existing act. Unfortunately, 70% of respondents to our survey—naturally we do not want to make any generalization—said they did not know the act that is being amended.
Three questions dealt with the credit needs of small business owners. Question 6 sought to determine if the act should be accessible to all small businesses or only to those which could not otherwise obtain credit.
In the first instance, the legislation would apply universally, whereas in the second instance, it would be a last resort. Question 7 dealt with the notion of risk associated with the type of business or the type of project that needs financing, which has a direct impact on the level of risk guarantee provided under the act.
Should the act help businesses without taking into account the level of risk involved or apply only in cases where the level of risk is considered reasonable?
Finally, question 8 asked the opinions and the needs of entrepreneurs regarding the purpose of the loan guaranteed under the act.
In this connection, ought the bill to guarantee only loans on equipment, real and personal property, or ought it to also include the working capital of a business?
Sixty-two per cent of our respondents felt that all small and medium-sized businesses ought to be able to avail themselves of the legislation, regardless of whether or not they could borrow money in other ways, or fund their projects in other ways, unlike the present situation, which limits access to only those which would not otherwise have access to funding.
When we see that a sizeable number of women are launching businesses of this type, one is entitled to expect a degree of openness in this area, since it is without a doubt almost universally recognized that women generally have far more difficulty than men in obtaining credit.
On the other hand, 91% of owners believe loans guaranteed under the act should be made only if the risk presented by the company or its plan is a reasonable one. This shows how wise the people in my riding are, as they call for a more universal opening-up of credit, as well as for guidelines and for only reasonable projects to be funded.
In this research and in the responses that came from our constituents, we also found out some very interesting things about the reasons small and medium-sized businesses succeed or fail.
I will probably have a chance to speak again in this debate in order to provide more detail on the points of view expressed by the men and women in my riding.