Debates of Nov. 30th, 1998

Royal Canadian Mint Act

[An hon. member]

On division.

(Motion agreed to)

[The Acting Speaker (Mr. McClelland)]

When shall the bill be read the third time? By leave, now?

[Some hon. members]

Agreed.

[Anne McLellan, Liberal, for the Minister of Public Works and Government Services]

moved that the bill be read the third time and passed.

[Carolyn Parrish, Liberal, Parliamentary Secretary to Minister of Public Works and Government Services]

Mr. Speaker, I am pleased to speak to Bill C-41, an act to amend the Royal Canadian Mint Act and the Currency Act.

It was over 10 years ago that the legislation governing the mint was amended to allow it to become a fully commercial crown corporation. Bill C-41 is designed to improve the mint's operations and to improve its potential in markets that have changed considerably since 1987.

I do not intend to go into great detail about the content of the bill. However, I would like to briefly reiterate to the House the basic purpose of the bill which is threefold: to streamline the approval process for issuing coins and coin designs; to provide flexibility in the governance structure of the mint; and to increase the powers of the mint within its existing accountability structure which will allow it to achieve its vision of global leadership in minting. The passage of this legislation is crucial to the mint's future.

One thing that struck me during previous debate and subsequent further examination at the committee stage is how intense the competition is within the international coin market. This global business, that accounts for 70% of the mint's revenue, also works to reduce the overall cost to Canadians for the circulation of their own coinage. Last year alone the mint produced one billion coins for 16 different countries. By the end of this year that total will rise to an amazing 2.5 billion coins.

We are, through the provisions of Bill C-41, proposing that the mint be given the powers of a natural person to provide it with sufficient flexibility to meet its long term strategic direction and achieve its vision of global leadership in minting. The powers of a natural person will allow the mint to support its public policy role of producing domestic coinage and operating at a profit.

The mint will continue to be able to exercise all of the same specific powers that exist in current legislation while enabling it to acquire more general powers in support of its mandate. However, it is still subject to the existing accountability framework found in the Financial Administrative Act. It would still involve review by the Treasury Board and the approval of the Minister of Finance and the governor in council. In addition, the auditor general will continue to conduct an annual audit of the Royal Canadian Mint as well as a special examination every five years.

With the powers of a natural person, the mint will be more proactive and able to react more quickly to new business opportunities. These powers will provide the mint with the flexibility to enter into alternate business structures, such as alliances, partnerships, and subsidiaries. With these powers the mint will be in a more advantageous position in relation to all challengers within an extremely competitive international market.

The mint currently operates extremely well in a highly competitive and rapidly changing environment. These new powers will give the mint the increased flexibility it needs to be market sensitive, seize new business opportunities and be a more profitable enterprise for the benefit of all Canadian taxpayers.

Another key provision of the act is to increase the mint's borrowing authority which will allow the mint to foresee financial needs and the ability to respond quickly to any market opportunity that is commercially attractive and advantageous. This increase was seen by independent third party experts as prudent and realistic in keeping with current market conditions and practices.

The mint borrows for short and long term purposes. Long term borrowing is required for investment in capital and technology. Short term borrowing allows the mint to finance more competitive bids and expand its markets. It is important to note that the mint's borrowing limits will still be subject to approval by the Minister of Finance and the governor in council.

These powers will put the mint on the same legislative footing as other successful commercial crown corporations. Just as important, it will place the mint on an equal footing with its main competitors, other government mints, such as those of the United Kingdom, Austria and Germany.

This legislation will therefore improve the mint's competitive edge immeasurably and will ensure the Royal Canadian Mint achieves its vision of global leadership in minting. However, as stated previously throughout debate on this bill, the mint will still be subject to the same rigorous accountability framework that exists now.

Members will note that the bill has been amended at committee in order to maintain the role of parliament regarding the addition of new circulation coins and the deletion of existing circulation coins.

Bill C-41 does allow the mint to make changes in the characteristics of circulation coins by regulation rather than by time-consuming debate in the House. This allows the government to react quickly to changes in production costs and availability of metals while ensuring there is full opportunity for consultation and participation by Canadians at the occasion of adding new coins or deleting old coins from circulation. In fact, the amendment acts to improve the bill even more.

In closing, I would like to also note that Canadians should be proud of the true success story of the Royal Canadian Mint. Our mint is one of the finest in the world. Canadian coins are world renowned for their high quality and beautiful artistry.

I would like to take this opportunity to pay tribute to the mint. It is a truly world class competitor operating on solid business principles in an increasingly competitive market. In recognition of this, I would submit that passage of this bill would be our way of providing the Royal Canadian Mint with the best means of achieving its goals. Canadians should expect nothing less.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, it is an honour and a privilege to rise in the debate on Bill C-41.

As the hon. parliamentary secretary has indicated, it is a bill to make some major changes in the mint. I find myself somewhat less supportive of the bill than is the hon. parliamentary secretary.

I would like to assure her, all members opposite, as well as the chief administrator of the mint, the master of the mint, that I in no way wish to cast any aspersions on how the mint is being operated. The master of the mint is doing a very competent and fine job. If I were wearing a hat I would take it off to her because the work she is doing is excellent. She is a very good manager. She is aggressive, alert and knows what to do. She is capable and competent in the work she has been charged to do. She has also been very successful in turning the mint around so that today it is a profitable venture. I just wanted to recognize that and support the work she is doing. I certainly agree with the hon. parliamentary secretary that the mint is in good hands.

The matters I want to come to grips with have nothing to do with the operation or focus of the mint as it presently exists. My purpose this afternoon is to focus on those things that have to do with government and public policy which are implicit in the amendments proposed by the government. It is very important to recognize exactly what it is that underlies the amendments that are currently being proposed in Bill C-41.

I want to focus on the issues from three particular points of view. First, I focus my analysis of the bill on the role of the government in providing programs and services for the people; second, the role of government to determine the conditions under which the economy operations; third, the mechanism of crown corporations and their place in light of the role of the government and how it presents itself.

It is very critical and necessary for us to remember that the mint is a crown corporation, as is the Business Development Bank, as is Canada Post, as is Canada Mortgage and Housing Corporation and a whole host of other crown corporations. The mint is in the same kind of category.

The first perspective is the role of government in providing services and programs for the people. First the caveat. Those listening might say what in the world does that have to do with Bill C-41. As I progress through my remarks it will become very clear that not only do the principles apply but they should apply not only in the case of the mint but to all other crown corporations. We want to be sure we recognize that is issue. We need to go one step further and assert that the principles existing here should apply to not only crown corporations but to the provision of government services and programs to meet the needs of the people of Canada.

What is the role of government in terms of determining the conditions under which the economy operates? The number one principle I would like to annunciate clearly is that of freedom. The Government of Canada needs to provide for the people of Canada, and for businesses generally, freedom. What is the freedom we want them to have? We want them to have the freedom of expression, to express and to hold views that are consistent with their particular sets of values and beliefs. We want them to apply their talents, their abilities, their competence, their innovations, all those kinds of things in a way that best suits their needs and developments and in a way that they can reap the most money and benefit from the application of those skills.

Mr. Speaker, you are one of those entrepreneurs. You know exactly how this kind of thing works. You express yourself in a most powerful way in your particular business, the one you are involved in now, the businesses you have been involved in before and the businesses you will be involved in the future. It is not only yourself, Mr. Speaker. There are other people on both sides of the House who also want the freedom to express their creativity and the things they do in the best way possible to garner a profit and at the same time provide a service and fulfill a need in the public.

There is another kind of freedom we want. We want it in business. We want it in the individual lives of people. That is the freedom to believe what we want to believe.

This morning it was my privilege and honour to be at the Sri Chinmoy peace celebration at the Chateau Laurier. Sri Chinmoy has gone around the world in the interests of peace. We had representatives from New Zealand, Zimbabwe, South Africa and many nations of the world at the Chateau Laurier this morning. They were there with one purpose in mind, to declare Canada and to celebrate Canada as the first nation in North American to be a Sri Chinmoy peace nation. It is wonderful to be a part of that. I was there to witness this event. The idea that we can be free to express whatever we believe in a positive way is necessary and essential for us to do what is right.

We have talked a little about entrepreneurship and the ability to apply one's capital in the way one wants not only for one's own benefit but to build the economy and build the country.

There is more than that to this business, the matter of ownership. There comes with ownership a certain pride. People who own property somehow feel a little better toward maintaining that property and keeping it looking good and things of that sort.

The first principle the government needs to provide is the concept of freedom. Next we need security and stability. Members saw in question period questions raised about how people sometimes find their personal security, their personal life being attacked and their comfort being attacked.

We want protection and safety of person. We want to make sure that is there and that it is maintained that way. We also want security of property. So often we find that people want to damage property.

We need to be sure that our society and our government provide an environment so that the property we have maintained is safe, so that we can go home and we do not have to worry that somebody will damage our property while we are at home looking after our children or doing some of the other things we like to do with our loved ones, our children, play games and things of this sort. We want our property looked after when we are away from home.

Here I think is the very fundamental issue where we come to this business of ownership, expertise and enterprise. We need conditions established by the government to create laws that encourage entrepreneurship. To create a bunch of crown corporations does not stimulate entrepreneurship. Our laws that establish crown corporations do not encourage entrepreneurship. I will get into this in detail when it comes to the mint.

We need to do that in a variety of areas. We need fair competition. There are all kinds of indications today about being sure it is fair, that there is not abuse of dominant position.

In Canada we have the Competition Bureau and the director currently involved with probably one of the most difficult decisions he will have to make a recommendation about to the government. That has to do with the merger of the big banks. We want to make sure the laws the government creates are such that competition is fair.

The hon. member opposite suggests the Competition Bureau has no power, it cannot do anything. If that is the case, the government has made another mistake, creating a Competition Bureau which is apparently supposed to have some power. The hon. member says it has no real power. Therefore the government should then create a law that gives the Competition Bureau some power. I suppose the hon. member will say do that then. That is exactly what we are talking about here.

[John Solomon, NDP, Regina—Lumsden—Lake Centre, SK]

I support the Competition Bureau's having some power to do something. Right now it does not have any power really.

[Werner Schmidt, Reform, Kelowna, BC]

We have it straight. Is that not interesting? We find two people in different parties actually agreeing. I think that is wonderful. It is about time members opposite recognize that where common sense operates there is agreement. The difficult part of it is that there does not seem to be much common sense on the other side of the House.

[John Solomon, NDP, Regina—Lumsden—Lake Centre, SK]

I agree with that.

[Werner Schmidt, Reform, Kelowna, BC]

There we go, two agreements in one afternoon, in one speech. That is absolutely tremendous. I commend the member because he is learning quickly.

The third area we need to be sure about, in which the government creates security, is the conditions under which we can conduct our business, namely the availability of capital.

We have had all kinds of talk here within the last four or five years about access to capital, particularly for small business.

If there is not availability of capital, it is very difficult if not impossible to do business, to get involved in a business, to develop a business, to grow a business. The availability of capital is the next issue the government needs to make sure is there.

There needs to be as well a provision for fair and just labour laws that work. The operative word here is work, labour laws that work, that do not create strikes, that create an environment in which both labour and management can work together, where the organization can achieve its goals and where labour and management can work together as a team to get this to work. We need good, solid, fair and just labour laws to make that happen.

We need more than that. We need reasonable government regulations as well, not regulations that become overburdening so that businesses spend more time figuring out how to fill in all the forms than doing business.

There has to be confidentiality and protection of intellectual property. In this new age of knowledge based industry that is particularly significant. Individuals need their intellectual property protected.

We need to deal with the protection of privacy. The privacy of persons, business and government needs to be protected. I am sure members are aware of what happened in July. A company that was to shred documents did not shred them but instead sold them at a profit. There were some very serious documents and some very significant breaches of privacy and violations of privacy provisions in that operation that did not meet the objective for which it was set up to work. Our laws are there but there was a failure somewhere with someone not doing what was necessary to monitor and ensure the laws were observed. Not only good laws and good regulations but the enforcement of those laws has to take place.

Jobs need to be available. In order to provide jobs we know now from a variety of cases that the first issue here has to do with reduced taxes. We have the Canadian Federation of Independent Business, large businesses and we have had individuals who create jobs say the number one stimulus for creating jobs is lower taxes. If we increase taxes, we reduce jobs. There is substantial evidence that is the case.

The Canadian taxation structure has been rising. The taxes we pay have been rising. There is excise taxes, GST, provincial taxes, income taxes, property taxes and on and on it goes.

There is another issue. People will say we need good safety nets. The best possible safety net is to have good, well paying jobs for people. That is the safety net that really works. With whatever safety nets we have for those people who are unfortunate enough to need them we have to make sure the benefits of the safety nets are not greater than the benefits that come from profitable employment.

If people are gainfully employed and make less on their gainful employment than they would from the benefits of a social program, that is a disincentive to seek gainful employment.

I believe the government is responsible to make sure the conditions within which businesses operate are supportive of entrepreneurship for gainful employment, creating jobs and things of this sort.

We need to move on to what I consider the shallowness of government thinking in the preparation and presentation of this bill. We heard the hon. parliamentary secretary say the mint was incorporated about 10 years ago. In the last 10 years there has been no review of the legislation, so we had better look at it. That has to be one of the most profound reasons for doing anything that I have ever heard.

We have legislation. It is working. The hon. parliamentary secretary recognized the master of the mint is doing a very fine job and I agree the job is well done. The mint is doing its work. It is making money. We have to review to make sure we know what it operates under. It is operating well. That is the reason, though, for presenting this legislation. We have not done it for 10 years so we had better do something.

We need to increase the borrowing power of the mint. It currently has the right to borrow up to $50 million. The legislation proposes that be increased to $75 million. Why? To take advantage of any possible business opportunities that might come about.

I was absolutely flabbergasted in committee when I watched members opposite listen to the argument that was presented. Guess what it was? The presentation indicated that during the last 10 year period an opportunity came along for the Canadian mint to buy a mint in another country. But it could not buy the mint in the other country because it would have had to borrow more than $50 million.

At no point was there any question about whether the Canadian mint was in the business of acquiring mints in other countries. That might be a useful discussion.

Why does the Canadian mint need to buy a mint in another country? That fundamental question was not addressed.

Let me look at another aspect of the analysis. This has to do with the number of directors on the board. The proposed bill suggests that the number of directors on the board be flexible, ranging from 9 to 11. The current legislation provides for 11 directors. Why the change to 9 to 11? It is to create some flexibility and to save costs.

If the real reason is to save costs, then I think we should fix it at 9. Why go to 11? If it is good sometimes to have 9 and sometimes to have 11, why would we not go with 9, especially if the reason is to save money?

[John Solomon, NDP, Regina—Lumsden—Lake Centre, SK]

Is this worth debating? It is a pretty mundane point.

[Werner Schmidt, Reform, Kelowna, BC]

Yes, I think it is significant. This is the point. It is not just dollars and cents. The issue also becomes one of the possible manipulation of decisions that would be made by the board. If it looks like an issue that has to be dealt with and they find that they are not winning it with 9 directors, they can quickly appoint two more who they know will be in favour of their position.

[John Solomon, NDP, Regina—Lumsden—Lake Centre, SK]

Is that surprising?

[Werner Schmidt, Reform, Kelowna, BC]

It does not surprise me at all.

What I am trying to point out, not only to the hon. member but to members opposite, is that is not in-depth thinking. This is superficial, manipulative, opportunistic thinking which allows individuals to take advantage of a particular opportunity to suit their advantage and to suit what they want to do. It is not in the interests of the Canadian public. That is the point I am trying to make. That is why it is worthwhile debating this particular point, mundane or otherwise.

I now want to move to the fourth area which has to do with the role of crown corporations generally. This is probably one of the most significant issues for us to come to grips with which has not been dealt with in the House for quite some time.

I would encourage the parliamentary secretary to read this document. This document concerns the crown's financial institutions. It was published by the Senate Standing Committee on Banking, Trade and Commerce.

That particular committee did some very in-depth thinking about corporate structures and crown corporations in particular. The report addresses the need for cost effective ways of delivering business oriented government programs to the public. To achieve these ends government must ensure that policy goals are clear, that the mandates of the agencies and employees to deliver its programs are clear, that they do not waste public resources through needless duplication of efforts within government and that the government and the private sector act in a complementary fashion whenever possible, with government doing what it does best while encouraging the private sector to do what it does best. Those are four fundamental principles that we need to observe.

It is significant that the committee came to an overall conclusion after it heard from all the witnesses and reviewed all the studies. It concluded that there is an important role for the federal government to play when the private sector fails to meet the needs of worthy business ventures. In other words, government must respond when gaps exist in the system. To this end the government needs to employ a number of strategies to fill these gaps. However, when these strategies lead to unnecessary overlap and duplication among different government agencies or to competition with the private sector the resulting inefficiency hurts everyone.

That is a pretty powerful statement and it fits right into the debate we are having this afternoon on Bill C-41.

During the last five or six years the government has been telling crown corporations that they must become self-reliant. In this case self-reliance does not mean they would manage their affairs efficiently. It goes well beyond that. It says not only must they be efficient, not only must they achieve the golden purposes of the organizations for which they were set up, they must also make a profit so they can return a dividend to the shareholder, which is the government.

This is abundantly clear upon reading the purpose and function of Canada Post, the Canada Mortgage and Housing Corporation, the Canadian mint and the Business Development Bank of Canada, to mention only four. It is abundantly clear that one of the motivating factors is that to be self-reliant means to make a profit.

[An hon. member]

Self-reliant does not really mean you are going to make a profit. It means you are self-reliant.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, the hon. member suggests that to be self-reliant does not mean to make a profit. That is absolutely correct, but that is not the way it has been interpreted by the Minister of Finance, the Prime Minister, the Minister of Public Works and Government Services or the Minister of Industry. Each of these ministers has interpreted self-reliance to mean “make money and pay the dividend to the Government of Canada”. That is what they are supposed to do.

A crown corporation is a very unique creation. It is neither government, nor is it private. It is sort of a hybrid between those two. We need to look at some of the confusion that has resulted because of this situation. The crown corporations have confused their roles, goals, philosophy, management style and focus. Let us look at each of these in a little detail.

Concerning the roles and goals of crown corporations, they must ask themselves the following questions. Are we customer or client oriented, or are we politically oriented? Where is our primary focus: on the client or customer, or on our political master? What is our goal? This is the second area about which they are confused. Is our goal to fill a gap that is not being provided by the private sector, or is it to advance our profit prospects and compete directly with the private sector by expanding into businesses that are more lucrative? I have examples of each.

Concerning the philosophy of crown corporations, they must ask whether they believe they should serve the public, their customers and clients, to the best of their ability, or whether they should primarily look after the political interests of their shareholder, the government.

Concerning management style, they must ask whether their style is to be that of a consistent, compassionate team player in which employee and employer share in the pursuit of mutually beneficial corporate goals, or whether they are to be the strong arm of the government and say “This way or no way and, come hell or high water, like it or not, you are either going to do it my way or you are not going to do it at all”.

This was particularly evident in the most recent action by Canada Post to its postal franchisees. It started on April 1 by telling them this is what they were going to get. They did not like it. They found it to be troublesome. Canada Post delayed it until October 1. It said that it would hold a lot of consultation. It could not meet that goal, so it said that it would wait until December 1, which is tomorrow.

We still do not know what it is going to do. It went through the various consultations. I have talked to franchisees from across the country, from one end to the other, and every one of them said this was a one-way consultation: “This is the program. This is how you have to present it. This is how it is going to affect you”, with no particular change, unless there is a change happening today which we will hear about tomorrow.

That is not exactly in the interests of itself.

[An hon. member]

You're doing a hell of a job.

[Werner Schmidt, Reform, Kelowna, BC]

I'm so glad. At least I am impressing somebody. The hon. parliamentary secretary should really be listening.

[An hon. member]

They are all sleeping.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, they sleep all the time. That is why they have not analysed this in any depth. They still do not know what this bill is about.

[An hon. member]

I was referring to Liberal senators.

[Werner Schmidt, Reform, Kelowna, BC]

I am really pleased, Mr. Speaker, that the minister for trade has finally woken up and listened to what is going on on this side of the House. It is about time.

[Howard Hilstrom, Reform, Selkirk—Interlake, MB]

Mr. Speaker, with all the conversation going on beside the member speaking, I am having trouble following what is being said and I would like to participate.

[The Acting Speaker (Mr. McClelland)]

The hon. member for Selkirk—Interlake is invited to participate, as is anyone.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, I thank the hon. member for bringing some decorum back to the House.

The point we need to recognize is that there are some questions above those about goals, philosophy, focus and management style. There are other questions which need to be addressed.

Does the crown corporation complement or does it compete with the private sector?

Particularly significant in light of this question is the recent broadening of the scope of crown corporations to make them self-reliant. The only way to do that has been for crown corporations to go after profitable businesses in the private sector.

Let me give one good example, the Business Development Bank of Canada. It recently published an ad in the Globe and Mail which presents to the people of Canada a guaranteed GIC backed by securities on the Japanese stock market. The bank says that if the GIC is kept to maturity, seven years, the purchaser's capital will be guaranteed. Regardless of what happens to the market, there is a guarantee that the capital will be returned. In the meantime, the interest paid on the GIC will be directly related to the performance of the Japanese stock market.

What has the Business Development Bank of Canada got to do with this kind of thing? It is not a deposit taking institution. It was created to help small business people and, in particular, to develop the knowledge based sector.

Looking at the record of what the Business Development Bank has done in terms of supplying capital to small business and comparing that to what the chartered banks have done, we discover that in proportion to the amount of money it is lending out the Business Development Bank falls short. The chartered banks are actually doing a better job than the Business Development Bank.

It is a crown corporation. What is it doing? It is not meeting the objective for which it was originally set up. It is doing something else. It is getting into an area that is currently being served by other organizations in the private sector.

We need to ask a second question. Does the crown corporation move away from the high risk or low profit areas and enter into more profitable areas? I can talk about a couple of issues.

I want to refer particularly to the credit unions and the Farm Credit Corporation. When the credit unions appeared before the committee they said “Because the Farm Credit Corporation is under so much pressure to meet its own bottom line as an institution, it is going after that kind of business in the very markets in which we have always been doing that. That is a real difficulty for us. It is not that we will not sit down and work with them on this. However it is one thing to talk about partnering and another thing to get down to the nitty-gritty of what partnering means and what role each partner is to play”.

The credit unions, private organizations, are in direct competition with the Farm Credit Corporation, a crown corporation. They are essentially doing the same thing. FCC is now moving into an area that is not as risky and is not doing what it was originally set up to do.

There are all kinds of examples like that. We obviously do not have the time to get into that at this point. We need to carefully think through what the role of crown corporations really is.

I want to focus particularly on the final part of this paper. Two persons provided expert advice and this is to the credit of the parliamentary secretary.

Professor Trebilcock of the University of Toronto told the committee which deals directly with the question before us:

It is not sufficient in most policy contexts, including the one with which you are concerned, to identify simply a case for government intervention and then leap from the premise that some form of government intervention is required to the view that the form of the intervention should be through a crown owned enterprise. Governments have a vast array of policy instruments at their disposal. In every case, we must ask: Is this the appropriate choice of instrument to realize this particular policy objective?

In our 1982 study, we were particularly interested in this institutional boundary issue. Rather than using crown corporations, why does the government not increase its use of tax regulation or subsidization of private sector firms so as to align the conduct of these private sector enterprises with government public policy objectives? To put the question more bluntly: Is there ever a case for a crown corporation in any context? Conversely, could one not imagine governments achieving their policy objectives through appropriate choice of tax, subsidy or regulatory instruments directed at the private sector?

Then he went one step further. He said:

Whether there is a gap which should be filled, (and then what policy instrument is best adapted to filling it) to my mind should turn on serious evidence of market failure, e.g. monopoly, public goods/externalities, information failure, asking in every case (a) whether the government can do better than the private sector in resolving the demonstrated market failure and (b) what policy instrument is likely to do this at least cost and with fewest negative spillovers for other policy objectives. For example, is there insufficient competition among private sector financial institutions for SME business? Can a government agency better assess the prospects of a high technology enterprise than the private sector? Are there positive social or economic spillovers (externalities) from high technology activities that private sector agents cannot fully capture, leading to socially suboptimal levels of private investments in such activities? Can a government agency reduce the fixed transactions costs faced by private lenders in making small business loans?

Those are key questions from a key scholar in this particular area.

Then comes a practical application from Peter Kemball of Acorn Partners who said: “It is a very basic, philosophical problem, if you will, grounded in economics, and I just happen to have concluded, having watched things over the years, that while there are some very good things that have happened as a result of these organizations”—crown corporations—“those things could come about in other ways”.

He went on to say: “In fact, that is what the hon. Minister of Finance was saying in relation to a different environment. We do not need the public sector to make those things happen in a general policy sense. In the specific sense, yes, it is quite true that a particular deal may not have come together in the absence of such an organization. However, by and large, it is a policy failure. We do not have our overall rules right. That is why we now have these organizations”.

The committee recommended that certain public policies such as some aspects of the tax system, public programs such as the Small Business Loans Act and public institutions such as crown financial institutions be reviewed with an eye to changes which could be made to encourage the development of new initiatives in capital markets.

In conclusion, the important thing here is to recognize that the mint is a crown corporation and that there has not been an in-depth analysis of the need to change the act. There has not been a demonstrated need to increase the $50 million to $75 million in borrowing power. Why? Because at the moment it only has a $14 million loan outstanding, $9 million of which is long term and $5 million of which is short term borrowing.

Sure, it has an opening to borrow to quite a degree and it does need to borrow from time to time to meet its cashflow requirements. I agree with that and support it. However, that does not mean it can now borrow $25 million more, except for one thing, the mint is now moving directly into competition with institutions, organizations, private sector businesses like Westaim. Because of that, it has added an addition to the mint in Winnipeg at a cost of $30 million. Lo and behold, if we take the $14 million it has now and add the other $30 million to it, we are up to the ceiling. Now it needs $25 million more for cashflow.

I can understand that but this means that the mint has left its primary focus, that of minting coins, and gone into the manufacture and plating of coins which cuts directly into the business of a private enterprise in Fort Saskatchewan. Constituents object to that.

We expand the power. We have not even talked about how the mint's power has been expanded. By allowing it to have the powers of a natural person it is able to form subsidiaries and buy other businesses. It can do virtually anything it wants. That is fundamentally in error and not consistent with the purpose and role of a crown corporation which is to fill a gap that the private sector is not filling and to serve needs that are not being served in other ways.

That is why I am objecting. It has nothing to do with the administration of the mint or its functioning today.