House of Commons Hansard #157 of the 36th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was businesses.
The House resumed from November 17 consideration of Bill C-53, an act to increase the availability of financing for the establishment, expansion, modernization and improvement of small businesses, as reported (with amendment) from the committee; and of Motions Nos. 2, 3, 4 and 5.
Roy H. Bailey Reform Souris—Moose Mountain, SK
Madam Speaker, I might say that the vote that we just had is somewhat alarming in that in the last parliament closure was moved 35 times either by time allocation or by closure motions. In this parliament we find that already time allocation has been moved nine times, including the bill we are now debating.
When I talk with people in the community I talk with them in private more often than in public because in private people are more apt to say things which they would not otherwise disclose.
The amendment that we are debating is designed to prevent one family member who is part owner of a small business from taking out a loan if another family member has already done so.
With respect to financing for small business, we only hear of the times when it proves to be successful. What the government never hears about are the disastrous effects of ill-conceived loans. It is my purpose this afternoon to draw this to the attention of the House. I could go from now to midnight talking about what is designed to be a positive thing which turns out in fact to be a negative thing.
I can assure hon. members opposite that it is not very pleasant to sit in the kitchen with people who have run a third generation family business and hear their story about being put out of business because of a government loan to a competitor while they continued to struggle to survive and eventually lost their business.
This is not a rare occurrence. It is very common throughout Saskatchewan. Depending upon whom a person knows at the right time, which could be a politician, they get a loan to build a business in an area when that general trading area cannot support another business.
I would like to draw the attention of the House to a couple of instances. There were four eating establishments in a small town. Of those eating establishments, three of the four were family businesses. They had been family businesses since the town virtually began. All of sudden two of those businesses received big government loans, one in excess of $100,000 and one in excess of $125,000. The total pie was divided. There was not sufficient business to support those six eating establishments in that town. Two of the businesses which were struggling went under, while the other two businesses which received the government grants continued. I might add that one of them is now closed. We never hear what happens when government makes small business loans which create competition for a family business or some other business which is struggling to survive.
There is a long list of names. Hundreds of thousands of dollars have been paid out.
There was a small cafe owner who had always paid his local taxes. He was a part of the community and supported every activity in the town. Government money came in, his money in effect, and another business moved in and forced him to dilute his business to the extent that it is no longer a profitable organization. Did that happen once? Not at all.
When we look at the budget and the amount of money that is given to small business we never know how many times it happens. I could take two hours going through all of the business places I know of that have gone out of business because the government, with disregard, put money into an area which could not support another business of that nature. It is a sad story.
I know of as many people who have been desperately hurt and ruined by the Small Business Loans Act as I do of those who have prospered. The government only tells us about those businesses which have prospered. In all fairness, we need to look from coast to coast to see those who have been hurt.
I draw the attention of members to another incident. This was in a fair sized town where there were two bakeries. Again they were both family enterprises. They were both doing well. They both supported their community. They were both engaged in such things as the town council. A person came in who knew the right person at the right time and a loan was floated. That loan was in excessive of $140,000. As a result, that person was able to keep going on government funding until they put a community owned bakery out of business. There was not enough business to support three bakeries.
This motion is designed to stop a current practice. This motion has been put forward to prevent one family member who is part owner of a small business from taking out a loan if another family member has already done so. In other words, at present it is possible for an individual who is a member of a family running a business to get another loan. Even though the first loan was not under his name, he can take out another loan for a different purpose when the business is already operating with a government loan.
What are we doing? We do not have a careful watchdog to monitor who is getting the loans and for what purpose. I am not just talking about the banks which guarantee the loans. In my province we have business development corporations that would be a better source to inform the government under this loan procedure as to what business is most likely to succeed without hurting the businesses already in place.
Where I come from I cannot afford nor do I have the time to sit and listen to those people in my cities, towns and in some cases my villages who have been totally put out of business and have moved simply because government money is going in opposition to them.
The government should reconsider this bill because a person does not deserve to lose his or her business of three generations and be wiped out with government money going in opposition to their business which has probably been in existence over the last 50 or 60 years.
I wish the government would consider this motion which I will be supporting.
Gary Lunn Reform Saanich—Gulf Islands, BC
Madam Speaker, I am pleased to support the amendments put forward by my colleague.
These amendments will do two things. First, they will lower the maximum of a small business loan from $250,000 to $100,000. Second, they will prevent a second family member from obtaining a small business loan for a business when one has already been granted to another family member.
I would also like to comment on this whole small business loans program which, again with all due respect, I think has completely gone down the wrong track in what we are doing for the Canadian people.
This bill essentially will put $1.5 billion into the small business loans program where businesses that do not qualify for any other funding, that have been turned down by the banks and financial institutions for various reasons, would then try to obtain financing from the small business loans program.
I would argue this is the wrong approach. These people obviously are a higher risk. We are using taxpayer money as a poor investment. We are giving it to the worst business plans of this country, the businesses that are most likely to go broke and most likely to go bankrupt. The taxpayers will receive zero dollars on their investment. We are throwing money at bad business plans.
I would argue it is the role of government to be responsible for introducing legislation in this House that ensures there will be a strong economic climate. Again, I do not necessarily support subsidizing business after business by throwing money at it. Instead, we should be creating an economic climate where businesses can survive without government subsidies. In essence that is what this is. That is what we have failed to do.
My home province of British Columbia is in an absolute crisis state. As an example we can look at the forest industry in British Columbia. Many of my colleagues from British Columbia can attest to the fact that one of the principal reasons the forest industry and the business climate in the forest sector is in a crisis situation is largely government policy and the direction the government has been going in both provincially and federally.
The federal government cannot be let off the hook. It has created an economic climate, due to the quota system with the United States, where British Columbia has now lost a significant part of its quota to eastern Canada. The mills are suffering incredibly.
I was speaking with the senior forester in one of the forest product companies in British Columbia over the weekend. He tells me that their wood costs in 1994 were $43 a metre. Today their wood costs are $83 a metre. This has almost doubled. I asked him why they had doubled and what had caused the cost of the wood landed in the mill to be double to what it was three or four years ago.
He said strictly government policy, both federal and provincial.
I am a big defender of small businesses. They are the economic backbone of this country. If we are to have successful businesses, let us not do it with government subsidies. We have the government saying here is $1.5 billion available for small businesses.
Many of the ones that probably are struggling and will survive do not have access to this. Again, only the highest risk business plans are going to get access to this. We may never recover this money. I would argue very little we will recover.
The government gives out but takes right back through high payroll taxes. The EI premiums are billions of dollars higher than what they should be. The list goes on and on.
Speaking with small business owners, even very small businesses with only a few employees, they say they get government forms, both federal and provincial, in the mail two or three times a week. It never ends.
A full time bookkeeper is needed to keep up with the bureaucracy, the paperwork, whether it is the GST or the payroll tax forms or worker compensation forms. Some of them are provincial but the list goes on and on. How can they possibly survive?
It is our role as legislators to cut that down, break down these barriers. What kind of taxes are these companies paying? Can they be competitive? It goes further. Some of our most entrepreneurial people who should be creating these small businesses are running down south of us to the U.S. the day after they leave school. Why? Because of the economic climate in this country. Why? Because of the taxes they pay.
People pay double the taxes to our friends to the south. These are realities. These are the things the government should be focusing on.
The small business loans program has been around for a long time, which would only reinforce that the government is absolutely prepared to accept the status quo. It thinks things are just fine. Let us not change, just send out another $1.5 billion and that will take care of itself.
Some people cannot go to the bank. They get turned down and then go to the finance companies and get turned down there. They cannot raise any money, but we will give them some taxpayer money. We likely will never see it again because their business plans are flawed to begin with. The point I am trying to make is that government subsidies are not the answer. It has been proven time and time again.
Let us look at the fishing industry on the east coast in Newfoundland and the Atlantic provinces. What has this government done since 1993? It has spend $2 billion paying fishermen to sit at home and wait for the fish to come back but it has not changed anything within the department and how it operates. It has not looked at the root problems. It has not focused on anything.
The idea was to throw money at it and hopefully the problems will solve themselves. It accepted the status quo. That is not good enough. We need change. It is the same thing with the small business plan. That analogy can be drawn with small business people. Throwing money at them and saying go create a new business, we will create another level of bureaucracy to help them with their bankruptcy in six months is not the answer.
We have to create an economic climate where these businesses will thrive, where they will create employment, where they will be valuable contributors to their local economies.
We are not doing that. It is in every sector whether fishing, forestry or mining. All these areas are suffering. We have our heads buried in the sand. We are not looking at it. Now the government has forced time allocation. It will shut the debate off on this.
Again I plead with the government to look at the real problem. Travel to British Columbia to some of these interior communities. Go up to Lumby. Go down to Duncan. Go into Cranbrook. Go up to Prince George and see what is happening. One and a half billion dollars in the small business loans program will not solve anything. It will just be a high risk. If that is what the government is going to do it might as well go down to Vegas and dump it into a slot machine.
Some will argue I am against the small business programs. I am not. I will stand up and fight for small businesses. But I would do it differently. I would ensure that they have a strong economic climate. I would ensure that they are not being taxed to death on payroll taxes. It can be done without government subsidies. If I can leave one message, the answer to our problems is not government subsidies. It is our job to create the economic climate where they can survive.
Gordon Earle NDP Halifax West, NS
Madam Speaker, I am pleased to lend support to Bill C-53 and to join in the debate around the motions that have been put forward.
The Canada small business financing act is designed to assist small business. We in the NDP feel strongly that small businesses are a very important part of our community, a very vital part.
We believe that small and medium size businesses are an integral part of successful communities. I am sure that all of us can think of our various communities and point to many of the small businesses within our communities, whether they be construction companies, restaurants or information technology businesses, and we can see examples of people who are working hard, people who are dedicated, people who put in long hours to earn their living and to contribute in a meaningful way to our society.
I think of a small business in my riding of Halifax West, a small family restaurant. I go there sometimes in the morning for breakfast. I am served the most beautiful breakfasts, home cooked by the lady who operates this restaurant. This business creates an aura of hospitality, an aura of friendliness within the community. A lot of the local people come to that restaurant. They sit there and talk over the affairs of their community. They relate one on one with their neighbours. There is an atmosphere which is really good to see, people in the community interacting around this family business.
But it is also very noticeable that the owner of this business works very hard. She is in there first thing in the morning. She bakes homemade goods. She then deals with the customers who come in on their way to work. She is going all day. At the end of the day she has worked very hard and many long hours.
In 1996-97 small businesses created 81% of all new jobs, we are told. In 1997-98 small firms with fewer than 49 employees created 56,516 new jobs. Of the businesses operating in 1989, 51% were still operating in 1995. This is a testament of the endurance of these small businesses.
It is very important to realize that the people who operate these small businesses are people of integrity. They are people of honesty and they are people who would not necessarily take advantage of the programs that are being offered in a negative way. It bothers me when I hear Reform talking about not making things easier for people to access loans and to have help with their businesses. The inference is almost that these people will automatically take advantage of the grants and the programs available. But we must realize that most people in their small businesses are people of honesty and integrity and they are people who want to succeed. If we as a government, if we as a society, can help them, we certainly should be doing that.
It is for this reason that I urge all members in the House to give full support to the kinds of initiatives and the kinds of effort which will assist small business persons.
Lee Morrison Reform Cypress Hills—Grasslands, SK
Madam Speaker, I listened with great interest to the comments of the member for Halifax West. I think he misconstrues the intent of the amendments in Group No. 2, which is to protect existing small businesses.
I fully concur with his remarks concerning the little restaurant, the great service he gets and how hard the owner works. Full marks for that lady and full marks for the business. These amendments are aimed at preventing somebody from moving in and setting up another restaurant right beside it and getting a government loan which would allow it to unfairly compete and put that poor woman out of business. We have seen that happen in Saskatchewan. It is not an uncommon phenomenon.
In my part of Saskatchewan and in that part represented by the hon. member for Souris—Moose Mountain the towns and villages are dying. The small businesses that remain are hanging on by their fingernails. When another business moves in to a place where there cannot possibly be room for two, and that business has a small business loan or a government grant, the business that is already there and just barely hanging on goes down first. Then the business that came in with government help usually goes down within a couple of years because it does not have the feel for the market nor does it have the skills of the business that had survived in that place for two or three generations. Instead of having one struggling business making it on its own, we end up with nothing, thanks to the beneficence of our government in backing these loans.
That type of interference with the marketplace is not good for society. I am not here to get into a long ideological harangue about the free market. We can debate that at another time and in another place. I am sure the hon. member for Halifax West and I could have a wonderful time debating that. We are debating a specific government bill and some proposed amendments to it which, in our eyes, would make it a better bill.
I know there are men and women in small business on the benches opposite. I have talked to some of them and they appear to be very reasonable folks. I think that in their hearts they understand what we are talking about in these amendments.
I would be surprised if there is a member in this House who has not had someone say to him or her “A new business has opened just down the street from an existing business providing a similar type of service in my hometown. It looks like the new business is going to put the old one out of business. We think it must have got a small business loan or a grant”.
There is this cynical outlook. Whenever anybody starts a business in a place where conditions do not look good, the public immediately concludes it was done with government help and by George, I think that 90% of the time the public is right. That is not the way to run a country. However when push comes to shove and the big shepherd holds up his staff, those people over there who understand this phenomenon and who are small business people all say “baa” in unison and the bill passes. This is not parliament as it was intended to be, which brings me to the matter of time allocation.
We are now debating with a gun at our heads. In the 35th Parliament the government used time allocation 32 times and closure three times. In this the 36th Parliament the government has already used time allocation nine times.
Instead of calling this the House of Commons, perhaps we should rename it the Dumas or the Reichstag because this is not parliament as parliament was intended to be. This is contrary to 300 years of tradition. It is contrary to the way that this parliament operated for the first half century or more of its life.
I believe closure was first used in this House by Borden. It was used extremely sparingly right up until the Trudeau administration. Then they started to lay it on heavier. Even that administration did not use it as many times in the several incarnations that it had as this government has used it in the last five years. The Mulroney government used it more extensively and with a heavier hand than the Trudeau administration but it was still a piker compared to this administration which is now routinely using it. The government uses time allocation time after time after time, no pun intended, and for no reason.
If there is an extremely important bill in the hopper and the opposition is being a little obstreperous and the bill has to get through or the country will collapse the next day at six o'clock in the morning, then yes. The technique was put in for a reason, but it was not put in to be used frivolously or habitually.
This is an affront to the traditions of parliamentary democracy. It is an affront which is practised routinely by this government. That is wrong. We have to get back to the tradition that parliament, not cabinet, but parliament is the overall authority in the country. Regardless of what the cabinet wants, parliament should be free to debate the issues of the day for as long as parliament wants and in any way it wants.
The heavy-handed manipulation has to stop. The whole institution is falling into disrepute. Unfortunately, people outside this place do not take us very seriously any more. I am sure, Mr. Speaker, you have run into comments of this nature in your riding.
About three or four years ago I was severely taken to task by a clergyman in my riding for having made a comment to the effect that under the system of parliamentary democracy as it has evolved in Canada, we now have a system of an elected dictatorship somewhat akin to what there was in certain periods in ancient Rome. He was irate. He said that was disrespectful of the country and its traditions. A few weeks ago I met this gentleman at a function and he said “You were right”. And I was right. This place is decaying because we no longer observe the democratic traditions.
It is a sad thing for me to have to stand and make these remarks about an institution of which I am a part, but I think it is time for a little honesty and a little truth. I am not alone in my views. This view is widely held outside this place. It is hurting us, it is hurting the institution, and it is severely damaging Canada.
Ken Epp Reform Elk Island, AB
Mr. Speaker, I am pleased to speak to this group of amendments today. I find it rather interesting that with over 150 Liberal members in this present government, none of them feel compelled to get up and defend why these amendments should not pass.
I believe that part of a debate is to put both sides of an issue on the table and to argue back and forth the merits of the case. What we have here today is a government which is totally abdicating its democratic responsibility. The Liberals not only do not want to debate this matter themselves, they just want to ram it through, but they have also said we cannot debate it. Both of these are rather insulting.
It is insulting that the government would use its majority to force through a closure motion, or time allocation as it is technically called, in order to restrict the length of time of the debate. It is also very insulting that the Liberals will not engage me in debate. I am really nonplussed by it. The silence on the other side probably says that they will support this motion.
When I am debating with someone, for example if I have a difference of opinion with one of my children, we debate things back and forth. I will say something and my son will say something else. We will go back and forth giving opposing points of view. Eventually we have to come to an agreement. I hope it does not characterize me as a soft father when I say that sometimes things go my way and sometimes my son is able to convince me of his point of view and things will go his way. That is what the process of debate is about. We do not have that here which is most regrettable.
Just as the government has used its majority to ram through the time allocation motion, it is also going to use its majority to pull the strings of the members opposite who will then dutifully vote against these amendments. These are good amendments. These are amendments which protect the taxpayer. These amendments protect businesses across the country. These amendments really are worthwhile. The government will not tell us its reasons for opposing them.
I do not know if this is parliamentary but I will be corrected if it is not. Is it because the government members are cowards? That is asked as a question so I hope the Speaker does not stop me. It is just a question. Why are the government members afraid to defend their position on this debate?
The government will go ahead and use this process and ram through whatever it thinks is right. We see this over and over in this government. We saw it big time when we were discussing the wheat board issue. This government was totally out of touch with the aspirations of farmers in western Canada. The government used time allocation, used closure debate and control of its members, even from the west, in order to do something which is diametrically opposed to what Canadian farmers need.
I know I am straying a bit from the specific amendments that we are talking about but I am using it to illustrate a very important point. The point is that democracy only works when we have true representation from the members who were sent here and elected by the people in their respective ridings. I wish that would actually occur. Instead we have another dog and pony show where the master in the centre of the ring snaps the whip and everybody else jumps through the hoops on cue. It is very depressing.
It is time for me to say a few things about the actual amendments. We should recognize a couple of things.
It is absolutely true that small business is one of the most important factors in a vibrant economy, and in Canada there is no doubt that is the case. We are told over and over again that the highest proportion of jobs are created by small business. The role of the government should definitely be to provide an environment in which small business can thrive.
I believe quite strongly in the principle of free enterprise. I believe very much in the forces of the free marketplace in determining who is successful and who is not. I have observed over and over in my short life that individuals who have been risk takers and hard workers very often have good luck. There seems to be a correlation there. Those who are timid and pull back say “I want everybody else to look after me”. In Canada we often think there is an inalienable right that “I do not have to work. I do not have to take any risks. Somebody else has an obligation to look after me and my family”. This has become a way of thinking.
I have genuine concern for the many who have absolute needs such as those who are disabled and cannot work. We will make sure they do not suffer. However there are many people who are able bodied. We now have a string of governments that has arranged the affairs of the country in such a way that the motivation for people to take risks, to do things that are unusual, to work hard, to get up early and to go to sleep late because they are working hard all day, has been somewhat taken away. A principle has been adopted that somehow it is an appropriate role of government to take away from the person who has earned it and to use it to subsidize the person who has not earned it.
Small business is important but we need to be careful the public policy we develop is such that small business can survive and thrive because it is successful, not because of having made the correct political donations to the correct party and thereby being eligible for subsidies from the government, which is a legalized form of taking away from the person who earned it and giving it to the person who did not earn it.
Am I opposed to small business loans? Absolutely not. I have had experience with loans. I was fortunate in the sense that my partner and I had a good business plan and good backing. We went to an ordinary bank, got a loan, got our business started and away it went. I wish I could say that it was very successful, but unfortunately it was in the farming industry and in the end it did not work out that well, again partially because of government policies.
I emphasize that some people have very good ideas but do not have the capital or have not accumulated capital in their lifetime to be able to access loans. In this amendment we are saying that perhaps there is a role to play. I know that my colleagues and I have had representations from some individuals who say the Small Business Loans Act and the small business financing act have some merit and have helped people to get on their feet who otherwise would never have been able to do so.
Let us make sure that we do not put the taxpayers at a huge risk that ordinary financial institutions are not willing to take. If the bank down the street is not willing to give an individual with a business plan a loan, maybe it is because the business plan is not workable. Maybe it is because there are too many flaws. Maybe it is because the individual has not demonstrated a record of financial accountability. For us to say that we should limit the value of the loan is a valid comment.
Val Meredith Reform South Surrey—White Rock—Langley, BC
Mr. Speaker, I appreciate the opportunity to speak to the amendments to the legislation. I want to give brief consideration to why I am a little concerned about the legislation in terms of dealing with funding to small business.
When funding businesses government does not often look at whether or not the businesses are new or whether they will be in competition with existing businesses that have not had government funding. People who have worked very hard, made sacrifices over a number of years, and built up businesses in communities often find themselves suddenly confronted with a government subsidized business that is working in competition with them.
To the business person who has worked for a number of years to establish a business it does not seem fair that the government is subsidizing someone to actually work in competition with them in an unfair and unequal way.
One has to ask what is the priority of government in funding small businesses and what the parameters of the decision to fund them should be. A colleague of mine has put forward an amendment that no two people in the same family can apply for a loan for the same business. This shows that the legislation has serious flaws.
If a business cannot get funding from a traditional source and goes to a government source of funding, it would only make sense that it be very controlled as to the risks of the taxpayer. It should be quite obvious although not explicit that the government should show due diligence in making sure that there is only one loan going to a particular family business.
Another motion under Group No. 2 talks about the level of funding that should be available. The amendment is suggesting that the level of $250,000 as set out in the legislation is far too extravagant. It is too great of a risk for taxpayers to put funds into a business that cannot get funding through a traditional source.
I will expand upon that concept. We have banks. As a matter of fact we now have a commitment from two major banks to establish a single bank responsible for lending money to small businesses. They have committed a substantial number of dollars solely to funding small businesses. If I remember a comment made by the CEO of the Royal Bank not too long ago, presently only a portion of that funding is used. I believe the number he mentioned was something like 70% to 80%. This means that 20% of the funds put aside for small businesses has not even been lent out.
The people who are applying for support from a government agency for whatever reason, and generally it is because the risk is too great, have not been given funding from traditional sources. When we start asking taxpayers to risk a maximum of $250,000 per applicant we are asking them to put at risk a fairly large sum of money.
It is interesting that the average size of loans made under the old program was only $65,000. We have to ask why the government would feel it should raise the maximum loan amount from $100,000 to $250,000 when the average loan is only $65,000. It seems to me that the $100,000 was plenty. It allowed some discretion on the part of loans officer or the people putting together the finance package. It allowed them a considerable amount of support. The fact that most successful applicants only get two-thirds of it shows that $100,000 was adequate.
We have to question why the government feels it is necessary to amend the legislation. Why does the government feel it is necessary to put that kind of financial support behind small businesses?
Having been a small business person I do not want to say that the government has no role to play. However I am not convinced through my experience with community leadership. I watched governments fund industries that had no hope of success. The government ended up having to eat the investment in industries that had no hope of success. I have seen governments do the same with small businesses. I have to ask whether it should be an area of federal government involvement.
The government has no business in areas of responsibility where it is not needed. This is one area where we have private institutions, banks, credit unions and other areas where people can get financial help. If they cannot it is often because their proposal is not solid enough. Maybe individuals need to be encouraged to make sure their business plans, concepts and ideas are solid enough to make their own sacrifice and not look to the taxpayers to make a like sacrifice for them.
I have great difficulty supporting the legislation although some of the amendments proposed by colleagues, particularly the amendment limiting the number of family members who can apply for a loan and lowering or keeping the level at $100,000 instead of $250,000, gives me an opportunity to say I can support it to a lesser degree. I question whether the federal government would be satisfying more Canadian taxpayers and Canadians in general if it were to put that kind of money into health care, education and those areas where Canadians feel the federal government should put its dollars.
That is all I will say on the bill and amendments. I want to take a few minutes to talk about the government's response to debate on the legislation. It is deplorable that the government has chosen one more time to seek closure on debate. I question that in any democracy a government should have the right to say, because it does not agree with what we have to say, that it will not allow us to be heard.
It is shameful the government continues to use closure to limit debate and to try to minimize any criticism on the legislation it brings before the House. If it honestly feels that the legislation it brings before the House is good, it should not have any problem with people challenging and debating it. If the government cannot defend it in the House of Commons perhaps it should withdraw the legislation and come up with something that is better and meets the needs of the Canadian public.
Susan Whelan Liberal Essex, ON
Mr. Speaker, after listening to the comments today I am a little surprised at what appears to be a lack of knowledge of Bill C-53. I say that with all due respect to my colleagues who have just spoken.
Members seem to think that there are no fees involved in this loan and that people who qualify for small business loans do not necessarily pay for them. The fact is that they pay administration fees and higher rates of interest. The loans are there to help those businesses which otherwise would not be able to get loans.
That being said, I want to speak specifically to the motions that were presented in Group No. 2. The first motion, presented by the hon. member for Saskatoon—Humboldt, proposes that persons not be related. Obviously he has not read clause 3 where it is already defined.
If he would recall correctly from our discussions at committee, we had a very long and lengthy discussion on this very topic when we discussed the proposed regulations that will be coming down later. As a committee we wanted to ensure that everyone is entitled to apply.
We also wanted to ensure that one business is not beyond the aggregate amount, which I believe is already covered in the bill and regulations will further define it. As well, we wanted to ensure that if a husband and wife are in separate businesses neither one is prohibited from being able to apply for funding.
I also want to speak briefly to Motion No. 3. This is a proposal that would reduce the loan amount under the program to $100,000 from $250,000. Again I think it would be important for members opposite to go back and read the testimony that we heard at committee, the discussions that took place and to look at the groups that appeared, the witnesses and those who had benefited from the Small Business Loans Act in the past.
The fact is that even representatives of the Canadian Federation of Independent Business said we should not go back. They suggested that it stay at $250,000. They suggested that it not be raised. They said that in the past they would have liked to have seen it lowered, but now that it is there we should not go back. They also suggested that we look at the types of businesses, and that is being done. They suggested that we look at who needs assistance and where the difficulties are in lending practices.
I remind my colleagues on the other side that the average loan amount is around $60,000 to $70,000 under the SBLA presently. Even though the limit is $250,000, the majority are falling much below that. There is no research at the present time which proves that larger loans pose any greater risk than smaller loans.
Several groups appeared before the committee. We asked the opposition for witnesses. The only groups that came before us to discuss the SBLA were those which had used the SBLA and were successful businesses. Some had borrowed to the tune of the $250,000 limit. Some of them told us that if the limit of $250,000 had not been there they would not be in business today. They have gone on to develop businesses that are worth $2 million or $3 million. Those businesses started with a small government assistance loan.
Let us remember that the assistance is paid for by higher than normal rates. If these businesses could go to a bank and get a regular small business loan without the assistance of the government or a guarantee then they would pay a lesser rate of interest. They are paying more money for this loan, but they are still doing well in their businesses. They were able to make it and survive once they got their foot in the door. If it was not for the government's guarantee they would not have been able to get that loan and they would not be in business today.
Motion No. 4 is pretty straightforward. Motion No. 5 is very much a housekeeping amendment because when the bill was originally introduced there were 85 loans under the Fisheries Improvement Loans Act that were still in existence. Those will soon be taken off the books, so we are just trying to ensure that the act and the legislation as it is written is as clean and understandable as possible.
I want to take this opportunity to talk about the successes of the Small Business Loans Act, the importance of continuing it, the new name for it—the Canada small business financing act—and the fact that so many businesses today will be able to get their foot in the door because it exists. The guarantee gives a little reassurance, when necessary; an extra push to get them in the door.
Many witnesses appeared before the committee, in particular from the restaurant sector, who said it is very difficult. We have spoken to the banks and we continue to speak to the banks at committee about the restaurant sector in particular, which has difficulty getting small business loans from banks. New people in business do not necessarily have long credit histories or long records of doing business and they need that extra assistance. We want to be there for them as a government.
The government knows that it is small business that is creating jobs. We know the potential that exists in Canada. We want to ensure that all small businesses have access to financing. That is what the Canadian small business financing act, Bill C-53, is all about.
I am a little disappointed by some of the amendments that are before us today because we had many of these discussions at committee. We discussed very thoroughly the size of a loan and the importance of it and the fact that individuals, to be able to have their businesses, need to be able to renovate, need to be able to open their doors and to run a good operation. We also discussed the differences between different types of businesses, about leaseholds, about existing businesses, about how people can move on and what people want to do.
It is a little disappointing that we are discussing loan limits. I really find it surprising, considering the fact that we have moved beyond $100,000 to $250,000. Evidence before us indicated that some people do need that much. Even the Canadian Federation of Independent Business, as I said earlier, said not to go back.
There are many, many success stories. We had people before us who talked about a building they had bought. They renovated it and leased out space. They were able to attract tenants and to become a centre for that community. If it was not for the Canada Small Business Loans Act, soon to be called the Canadian small business financing act, they would not be in business today. They would not have had that opportunity.
They put up a lot of their own dollars. The government guaranteed up to $250,000. That was it. In this case, in particular, each of the individuals matched that with their own personal money and put up their own personal guarantees as well. There is a lot of investment in making small businesses grow, in making small businesses happen and I think as Canadians we want to see this happening from coast to coast.
We know that different areas go through different times. We know there is difficulty in financing from time to time. We are trying to ensure that everyone has access and everyone has opportuntiy.
Some ideas are too new for the banks to feel comfortable with in the normal scheme of lending. Again, some people do not have a credit history or a credit risk history. It is important that we be there as a government and that we continue to deal with small business.
I speak from earlier days, before I was elected, when I was practising law and the administration of loans. I think it is important that people realize that the borrowers are paying a higher rate of interest. They are paying a fee. It is not a freebie. It is not that the government gives money and gets nothing back. The majority of these loans will be paid over time. Sure, there will be losses, but the majority will provide jobs, the majority will be successful. Many of these businesses will go on to hire people and will continue to develop.
One group in particular that appeared before us started very small and now has several tenants. They are collecting thousands of dollars in rent and they are able to continue.
I think it is important that we all participate in the debate today. I am sure that many of my colleagues will join me in reminding the opposition that the SBLA in the past has done a lot of good for small business and will continue to do a lot of good in the future. We need to ensure that the economy moves forward, we need to ensure that small business has access to this money and we need to ensure that small business can create jobs.
Peter Adams LiberalParliamentary Secretary to Leader of the Government in the House of Commons
Mr. Speaker, I rise on a point of order. I think you will find unanimous consent for the following motion:
That all remaining amendments at the report stage of Bill C-53 be deemed to have been read by the Chair and to have been duly moved and seconded and that, when the time allocated for debate has expired, the amendments will be deemed to have been put and a recorded division requested.
Division No. 265Government Orders
The Speaker
Does the hon. member have permission to put the motion?
Division No. 265Government Orders
The Speaker
The House has heard the terms of the motion. Do members wish to proceed in this way?
Division No. 265Government Orders
The Speaker
I am going to recognize the hon. member on debate, but I am going to give you the option. I think you might get two minutes into your speech before I have to interrupt you. Those two minutes might give us time for a few extra statements by members. I will recognize you. You will be given the floor and you will have your full time right after question period.
Ovid Jackson Liberal Bruce—Grey, ON
Mr. Speaker, I am pleased to inform the House that November is Osteoporosis Awareness Month.
Osteoporosis is an insidious chronic disease characterized by bone loss.
This disease makes people susceptible to hip, spine and wrist fractures, often leading to reduced activity and quality of life. Long term hospitalization and nursing home placement can be the result.
Osteoporosis is most common among women 60 to 69, and 42% of women over 79 have this disease. Younger women and men can also develop osteoporosis.
The month of November presents an opportunity for all Canadians to “bone up” and protect themselves.
On behalf of the House, I commend the Osteoporosis Society of Canada for its efforts and wish the society a very successful Osteoporosis Awareness Month.
Jack Ramsay Reform Crowfoot, AB
Mr. Speaker, RCMP Staff Sgt. Fraser Fiegenweld took the fall for the botched Airbus investigation. The extent of Fiegenweld's responsibility was never fully determined as he was allowed to retire from the force before his disciplinary hearing. As a result, Canadians do not know who is responsible for the Airbus fiasco.
It appears that history is about to repeat itself. Once again an RCMP officer has been singled out as a possible scapegoat. This time “Hughie” will take the fall.
If this is true, RCMP officer Hugh Stewart will shoulder the full blame for the pepper spraying of students at last fall's APEC summit, while any role the Prime Minister played may never be revealed.
For the sake of justice and the reputation of our beleaguered RCMP, I implore the Prime Minister to establish an independent judicial inquiry to ensure the complete truth is revealed and the integrity of the RCMP is maintained.
John Finlay Liberal Oxford, ON
Mr. Speaker, on October 30 I had an opportunity to visit telecommunications projects in my county with a number of distinguished international visitors. Visitors from Benin, Bhutan, Burkina Faso, Honduras, India, Kenya, Mali, Mozambique, the Philippines, Senegal, South Africa, Suriname, Tanzania, Uganda and Vietnam visited Oxford county.
The tour showcased Canadian expertise in rural telecommunications and provided the international visitors with firsthand insight into how groups in the county are using new information technologies to improve their services to our citizens.
Oxford County is a leader in rural connectiveness. In the first round of community access program funding Oxford County libraries received 25% of the total approvals in Ontario. Now we are building an integrated network across Oxford County.
I am pleased to see the county expertise shared with representatives of this international delegation. The visit was a success due to the hard work—
Denis Coderre Liberal Bourassa, QC
Mr. Speaker, yesterday was Lebanese Independence Day. Tomorrow, Lebanon's new president, General Émile Lahoud, will be sworn in.
On behalf of the Canada-Lebanon Parliamentary Friendship Group, I would like to tell our Lebanese parliamentarian friends and the Lebanese Canadian community that we are committed to Lebanon and to the development of co-operative relations between our two countries.
As Canadian parliamentarians, we are fully supportive of the construction process taking place in that country. We are also in favour of the full and immediate implementation of United Nations resolution 425 regarding the integrity of the Lebanese territory.
On behalf of the chairman of the Canada-Lebanon Parliamentary Friendship Group, my colleague, the hon. member for Anjou—Rivière-des-Prairies, who will be representing the Canadian government tomorrow at President Lahoud's swearing-in ceremony, in Beirut, I would like to wish every success to the new Lebanese president and express our solidarity with our Lebanese parliamentarian friends in meeting the great challenges ahead.
Val Meredith Reform South Surrey—White Rock—Langley, BC
Mr. Speaker, when a Liberal government introduced the Canada Health Act and national medicare 30 years ago there was a commitment for the federal government to provide 50% of the funding. Under this Liberal government that commitment has dropped to 11.5%, yet it claims that health care is its top priority.
This government spends millions of dollars a year funding golf courses, ski hills and banks—not only Canadian banks, but foreign banks as well—yet it claims that health care is its top priority.
While the premiers are unanimous in requesting that this Liberal government restore some of the billions of dollars that it cut out of health care, the response is that it would be foolhardy to do so.
The only thing that is foolhardy is to believe that health care is this government's top priority.
Reg Alcock Liberal Winnipeg South, MB
Mr. Speaker, once again Winnipeg has demonstrated why it is the greatest city in the world. Despite the fact that our beloved Blue Bombers decided to take the year off Winnipeg nonetheless put on a terrific show for the rest of Canada.
In typical Winnipeg style more people offered to volunteer than were needed. Volunteers greeted incoming visitors, showed them the many wonders to be found in the city with the warmest heart in Canada. They taught them how to party and they saw them off at the airport.
Hubert Kleysen, a resident of the best federal constituency in the greatest city in the number one country in the world, organized the festival of lights parade honouring Winnipeg's central role in transportation.
The halftime show included the largest fireworks display ever put on in Manitoba. Susan Aglukark sang O Canada. Fred Penner and Donovan Bailey entertained young and old alike and, oh yeah, a couple of teams played some football.
The energy to be found in Winnipeg was felt by those teams and they played what is being called the greatest Grey Cup in the history of the league. Once again Winnipeg comes through and if that is not enough good news I am told that next year the Blue Bombers are coming out of retirement.
Stéphane Bergeron Bloc Verchères, QC
Mr. Speaker, it is with pride that I rise to recognize the Journée nationale des patriotes, held yesterday in Saint-Denis-sur-Richelieu to pay tribute to these men and women who fought for the fundamental values of freedom and democracy.
By demanding greater civil and political rights, a truly democratic and responsible government, and their homeland's independence, the Patriots have had a profound impact on the development of Quebec and Canada.
Regrettably however, this government has misrepresented the sacred trust of responsible government. Given how the Liberal government is spiriting away the surplus in the EI fund for instance, we have every reason to wonder what has become of this principle that cost the Patriots so dearly.
A government that is answerable to the legislative assembly and does not make any expenditure that has not previously been approved by Parliament is part of the Patriots' precious legacy.
I urge cabinet to act accordingly, that is like a responsible government.
David Pratt Liberal Nepean—Carleton, ON
Mr. Speaker, 17 days remain before Jasper, Alberta native Stanley Faulder is to be executed by lethal injection in Huntsville State Prison in Texas.
Stanley Faulder's case presents some very troubling issues. Although in custody since 1977, Canadian officials were only notified of Mr. Faulder's situation in 1991, an apparent breach of the Vienna convention on consular representation which meant that Faulder did not have access to proper legal representation.
No juror has ever heard testimony about the brain damage Mr. Faulder suffered in childhood that left his behaviour occasionally unpredictable. And no court has dealt with the fact that James Grigson, the forensic psychiatrist whose testimony was critical in convicting Stanley Faulder, was later expelled from the American Psychiatric Association for unethical and unscientific testimony in death penalty trials.
I urge my colleagues in the House and every Canadian interested in justice to write to Texas Governor George W. Bush and the Texas Board of Parole and Pardons seeking clemency for Stanley Faulder.
Claude Drouin Liberal Beauce, QC
Mr. Speaker, on November 30, Quebeckers will make an important decision for the future of Quebec.
They will have to choose between a Liberal government whose priority is economic growth and another government that wants to hold a referendum, whatever the cost.
They will have to choose between a Liberal government that wants to improve the Canadian federation and another government that wants to continue its endless battle with the federal government, to the detriment of Quebeckers.
They will have to choose between a Liberal government that is working for Quebec's interests and another government that is focussing its time and energy on Quebec's separation from Canada.
This is the choice that Quebec will have to make on November 30. My mind is made up. I will be voting Liberal and I urge all Quebeckers to do the same, for a strong Quebec in a united Canada.
Preston Manning Reform Calgary Southwest, AB
Mr. Speaker, while recognizing that national unity is a sensitive issue, I do feel it is important to draw to the attention of the House that yesterday the best football team from western Canada beat the best football team from central Canada in the annual Grey Cup classic.
The Calgary Stampeders from the heart of Reform country beat the Hamilton Tiger Cats from the heart of Copps country by a score of 26 to 24.
We offer our sincerest congratulations to Sid Gooch, Wally Buono, Jeff Garcia, Mark McLoughlin and all the rest of the Calgary Stampeders. We also want to offer our congratulations to Ron Lancaster, Don Southern, Danny McManus, Darrel Flutie and all the rest of the Hamilton Tiger Cats.
Congratulations to the Canadian Football League for a great Grey Cup classic.