Debates of Dec. 8th, 1998

Canada Customs And Revenue Agency Act

[The Acting Speaker (Mr. McClelland)]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker (Mr. McClelland)]

In my opinion the nays have it.

And more than five members having risen:

[The Acting Speaker (Mr. McClelland)]

Call in the members.

(The House divided on the motion, which was agreed to on the following division:)

Division No. 308

[The Speaker]

I declare the motion carried.

(Bill read the third time and passed)

Income Tax Act

[Joe Fontana, Liberal, London North Centre, ON]

moved that Bill C-316, an act to amend the Income Tax Act (interest on students loans), be read the second time and referred to a committee.

Mr. Speaker, it is my honour to speak on my Bill C-316. Like my fellow members of the government caucus as well as other members of parliament, I believe that a well educated, vibrant workforce is the key to Canada's continued growth and prosperity and improved standard of living for all.

Of all the riches the country holds, our greatest resource by far is our people. It is our responsibility as the government of this great country to provide the people of Canada with an environment in which they may reach their full potential.

By giving recent graduates a tax credit for interest paid on student loans, the bill aims to support those Canadians who have decided to invest not only in themselves but in Canada and in our common future.

For years businesses have been given a tax credit for interest paid on business investment loans. This credit was granted based on the reasoning that moneys invested in business were contributing back to the Canadian economy.

Bill C-316 builds on this rationale by promoting the concept that a student's investment in his or her education is an investment not only in himself or herself but also an investment in Canada and in our future.

The government adopted the primary tenant of Bill C-316 in the 1998 budget and for that I thank the Prime Minister, the Minister of Finance and Liberal caucus colleagues for their support. The main issue which remains is the extension of interest relief to all student loans.

There are tens of thousands of students across Canada who do not qualify for government sponsored student loans. For many of these students the only way to pay for their education is to turn to private lending institutions for loans.

Bill C-316 would extend the interest relief credit to involve those loans that have been granted by private lending institutions for the purposes of financing a student's post-secondary education.

Education is a high priority for me and I believe for all members of the House and the government. The growing global economy is creating work that uses minds, not muscle. In the early 1990s more than 60% of new jobs were created in the areas of information and communication technology.

There are few businesses today that do not use a computer somewhere in their organization. Moreover, Canadians who earn good salaries and pay taxes contribute to a strong economy. A strong economy leads to progress and that is why the Liberal government launched a major assistance program this year, the Canadian opportunities strategy. This is good economic policy and good social policy.

The number of jobs requiring a university degree or post-secondary diploma has increased by 1.3 million since 1990. On the other hand, the number of jobs available for people with less education has dropped by 800,000. These statistics speak for themselves and the government is paying close attention.

In addition to transfer payments to the provinces to support post-secondary education, the Liberal government has put in place several initiatives to help Canadians who want to go to college or university. Canadians today must excel at the post-secondary level in order to achieve their personal dreams and to keep Canada at the head of the developed world, a global leader.

The most important direct federal support for post-secondary students is the Canada student loans program. Since the Liberal government brought in this student loan program in 1964, over 34 years ago, 2.7 million students in financial need have received over $12 billion in loans. Loans amounting to $1.4 billion went to 360,000 students in 1996 and 1997 alone. The CSLP is helping 380,000 students this year.

The new Canadian opportunities strategy will help hundreds of thousands of students through a series of measures. The strategy helps students manage their debt load through tax relief for interest on student loans. Graduates with long term problems repaying their loans may be able to reduce their debt or qualify for extended interest relief for up to 54 months. Through an improved student loans program the Liberal government is making it easier for young Canadians to gain the skills and knowledge essential to building an innovative economy.

In 1994 we announced that we would put an additional $2.5 billion over five years into the Canada student loans program. More than $1 billion in Canada student loans helped about 300,000 Canadian students go to college or university this year and the level of commitment is continuing.

We also increased loan limits by more than 50%. They had been frozen by the last government in 1984. We have brought in more flexible repayment rules. Under the old rules borrowers had to begin paying back their student loans six months after graduation even if they were unemployed or earning very low incomes. Under the new rules payment can be reduced or deferred for up to an additional 30 months and the government will pay the interest during that time.

Furthermore, the government introduced Canada study grants of up to $3,000 a year. This will help over 25,000 needy students with children or other dependents. We also doubled the annual limit on contributions to the registered education savings plan to $4,000 so that young families could put more money away for their children's future education. When fully implemented, the budget proposals of last year will increase federal assistance to post-secondary education by over $270 million a year.

This bill is more than a simple tax credit. It is about giving young Canadians the help they need as they enter the workforce, hope and confidence of a prosperous future and the dream of possibilities. It is about telling Canadians that when they choose to invest in their future through education their elected representatives, we here to represent them, will support them.

Since introducing this bill I have received numerous letters of support from students, educators, parents, school administrators from across the country as well as from members of parliament from all parties, all of whom recognize the importance of supporting our young people as they make the transition from classroom to workroom to boardroom.

I call on all members of the House to recognize and acknowledge the importance of supporting Canada's young people, for they are the foundation on which Canada's future will be built.

[Gilles-A. Perron, Bloc, Saint-Eustache—Sainte-Thérèse, QC]

Mr. Speaker, I would like to congratulate the hon. member for London North Centre. We are in favour of Bill C-316 and it is unanimously that the members of the Bloc Quebecois hail the initiative of the hon. member for London North Centre.

We must indeed support our young people, as our hon. colleague said. But that is what we, in Quebec, have been doing since 1964. At the time, the Prime Minister Pearson and Premier Lesage agreed on the transfer of powers over 24 areas to Quebec. One of these areas of responsibility was education.

In 1964, we immediately set out to develop in Quebec one of the best education systems and a grants and bursaries system second to none in the world today. We are very proud of this system.

That is why we furious and prepared to fight with all we have got to keep the federal government from laying even a finger on our school system. The Government of Quebec should be able to opt out of the millennium scholarship program with full compensation.

When the people across the way do things that we find are good, and they do, I make a point of acknowledging them.

Again, I want to tell our colleague from London North Centre that he can count on our support. We will be voting in favour of this bill.

[Paul Forseth, Reform, New Westminster—Coquitlam—Burnaby, BC]

Mr. Speaker, the purpose of this enactment is to allow a person who pays interest on a student loan to deduct from income, for the purposes of determining the tax payable, the full amount of the interest for 10 years after the first payment of interest was due. If the student does not use the full deduction in any year it may be transferred to the person, if any, who guaranteed or co-signed the loan initially.

It covers loans made under the Canada Student Loans Act, the Canada Student Financial Assistance Act and certain other loans for the same purpose not made under the government loan program for students if they meet the prescribed conditions.

The total cost of this new tax measure may amount to some $800 million. The 17% tax credit included in the measure will cost about $130 million. It would be a major step in helping students. Canadian society in general is certainly better off if we produce more university graduates. A well educated young population that has marketable skills benefits the individual and the country.

Canada's academic community is as good as that of any country. In many areas we are better. However, Canadian students have been under enormous pressure to bear more of the costs of their education. The total amount of federal-provincial student loans jumped from $875 million in 1990 to over $2.1 billion in 1994, a 144% increase in just four years.

As education is an investment, it should not be treated any differently than other capital investments that receive tax credits. Allowing student loan deductibility will relieve some of the pressure resulting from increasing student loan debts, even though student fees are only a fraction, perhaps just 10%, of the full cost.

Tax relief in the form of student loan interest deductibility will reduce student loan default rates. Tax relief for students may result in more opportunity for young people to apply to university and community college.

The Liberals have cut $7 billion from transfers to the provinces for health care and post-secondary education and are replacing it with $325 million a year from the millennium scholarship fund and $120 million per year from three other grant programs. The fund will not ease existing student debts. A grant of $3,000 to 6% of students will not help in a meaningful way, except in a political way, as it will be given by a Liberal government. Therefore, students are supposed to be grateful and vote Liberal.

The bill was introduced before the February 1998 budget. What is proposed in Bill C-316 goes further than the announcements contained in the 1998 budget, however. Considering the brain drain that afflicts certain sectors of our economy, such as computer science and medicine, this measure could be seen as a way of keeping recent graduates in Canada. This would protect Canada's human capital.

A Reform government would help all students by increasing transfers to the provinces for education, giving broad based tax relief, creating an income contingent repayment program and allowing interest deductibility.

We oppose the call for free, universally available undergraduate university attendance at this point. Some of the unrealistic student lobby groups have asserted that it is their right to have free university. They have also added that they want 100% grants. However, the country just cannot afford it at the present time.

There was also the operation of personal responsibility to contribute at least a fraction of the great subsidized benefit which university students receive.

There are many ways to ensure that demonstrated academic talent is supported and encouraged. Finances alone should not be a barrier. Therefore, loans, bursaries, scholarships and payment plans attached to income tax forms to truly address the ability to pay is the way to go at the present point in the nation's finances.

The bill is a good idea and should be supported not just by Reformers, but by all members of the House.

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, I am very pleased to have the opportunity today to speak in support of Bill C-316, which has been introduced by the member for London North Centre.

I would like to congratulate the member for bringing forward this proposal which will help provide some relief to students who are in very dire straits in Canada.

As we have heard, the purpose of this bill is to allow a person who pays interest on a student loan to deduct from income, for the purposes of determining tax payable, the full amount of the interest for 10 years after the first payment of interest was due. If the student does not use the full deduction in any year it may be transferred to the person, if any, who guaranteed or co-signed the loan initially.

I believe that the member's rush now for bringing forward this bill is because business owners are permitted to deduct interest paid on business investment loans. Using that provision as a precedent, Bill C-316 acknowledges the role of student loans as investments which deserve the same consideration.

Certainly from that point of view, in terms of the motivation of the member, we would support this bill coming forward. However, I think it also needs to be pointed out that this particular bill is a bit like treating the symptoms while ignoring the disease. The fact is that tax relief, while always welcome, does nothing to ease the fact that students must cough up increasingly high tuition fees in order to make it through post-secondary education.

This bill, although providing some relief, does nothing to address the fact that post-secondary education is becoming increasingly inaccessible to more and more students, particularly those with low and moderate incomes.

Unfortunately it does nothing to address the fact that over the last decade tuition fees have climbed a whopping 240%. Even in the last year alone tuition fees rose 12% nationally, which is seven times the rate of inflation.

That should give us some idea of the severe difficulties that students are facing today in trying to pay their tuition and in making it through school. It is simply an astounding fact that tuition fees are now seven times higher than the rate of inflation.

Nor does this bill, unfortunately, expunge the massive debts that students are graduating with, which now average $25,000. That figure is up from the average of $13,000 when the Liberals took power in 1993.

We are talking about a bill that would amend the Income Tax Act. The bottom line is that the reason we have a crisis in post-secondary education is because we have seen a retreat in public funding. We have seen the federal government slash funds from post-secondary education by $3 billion since 1995. As well, $4 billion has been cut from training.

If we really want to examine what is facing students in Canada today, why they are having such a hard time and why more and more students are graduating into poverty, we have to look to federal public policy from this Liberal government which basically has withdrawn its support to the provinces in transfer payments. Students are paying the price for that. That needs to be said.

While I support the member in his efforts to provide some relief, I also hope that the member would, within his own caucus and within his own government, rethink and examine the policies that have been put into place.

One of the changes in the last budget that was particularly cynical which affected students was the change in the bankruptcy laws. That has really had a very dramatic impact on students. It used to be that a student could declare bankruptcy two years after completing studies. It should be pointed out that most students do not declare bankruptcy. Most students will do everything they can to pay off their Canada student loan. In actual fact, the new law passed by the Liberal government now says that a student cannot declare bankruptcy until 10 years after completing studies or finishing school. That virtually rules out that option.

I do not know about other members of the House, but I have heard horror stories from students about how they are harassed by collection agencies at 7 a.m or 8 a.m. because they defaulted on a payment.

I am glad the member brought this forward. However, we have to get the real picture of the things that have been done by the government, such as changing the bankruptcy law and slashing public funding to post-secondary education, which have made the lot of students much worse.

Liberal members often point to the millennium fund as the panacea and the cure-all for the difficulties that face students. We should recognize that the millennium fund, which does not even begin until 2000, is just a drop in the bucket when one compares it to what actually has been taken out of public funding.

New Democrats are not about to let the federal government forget about the student debt crisis. Instead of creating a scholarship program which duplicates existing programs and does nothing to help students in need, we have called on the federal government to take steps that would reduce student debt.

We have demanded of the government that we end the privatization of Canada student loans, that we end the harassment that students have to go through.

We have also called on the government, along with the provinces, to begin to restore the billions of dollars that have been cut from post-secondary education. If we really are genuine about wanting to assist students we have to begin at that point. There has to be a recognition of what the erosion of public funding has done to post-secondary education.

I would also suggest that we should follow the leadership of my province of British Columbia which has had a tuition freeze for three years in a row. That is something that needs to be done on a national basis.

If the federal government really wants to show leadership for students and show that it cares about what happens to students, then the minister should be convening a meeting of provincial education ministers, putting some bucks back on the table and saying “We are going to help students by enacting a national tuition freeze”.

That would be the first step in restoring confidence in what really has been a first class system in Canada of public education, which now is going down the slippery slope to privatization.

The NDP would change the millennium fund to make it the first step of a national grant program to assist first and second year students.

Probably most important, we would begin by saying that accessibility has to be a national standard that is brought forward by the federal government with the co-operation of the provinces so that we can say to young Canadians “You do have a future. You do have accessibility and you are not going to come out of post-secondary education with a massive debt around your neck”. That is what the reality is now.

I have talked to students who have a $60,000 debt. They are single parents who are trying to pay off that debt and they have not started working yet. It is an appalling situation.

In closing, this is a good measure that has been brought forward, but I urge the member to go back to his caucus and say that the government must rethink its priorities and that if they support public education it needs public funding and confidence to make sure students are not facing the severe situation they face.

[Charlie Power, Progressive Conservative, St. John's West, NL]

Mr. Speaker, I congratulate the member for London North Centre for bringing forth the bill. Obviously it would be an improvement to the student loan system of today. However, I have fully concur and agree with the member from British Columbia who just spoke. Oftentimes the Liberal government takes away so much and gives back a tiny bit in its place, which does not solve the problem at all.

The real problem with post-secondary education is the cash transfers under the Canadian Health and Social Transfer Act. In 1995-96, $16.6 billion were transferred to the provinces to give social services and in particular post-secondary educational services to all young people. In 1997-98 Canadian health and social transfers to the provinces were $10.4 billion, or a loss of $6.2 billion to the provinces primarily in a fund directed toward social services and in particular post-secondary education.

If we combine that problem with tremendous cuts in transfer payments to the provinces, a tremendously high unemployment rate for young people, twice the national average consistently for the last 10 years, we realize the problem that many of our young students face.

The bill we are discussing is a good one. It is an improvement. Giving a tax break or a tax incentive to somebody who is heavily in debt, to the tune of $50,000 or $60,000 after getting an education, is good, but it is not the solution that young Canadians want when they cannot find jobs. Allowing students to write off some of their interest under student debt is good, but again it is not the solution that young Canadians want.

First and foremost young Canadians want an opportunity to access a good education at a reasonable cost. That is not happening in Canada today with tuition increases of over 200% in the last seven or eight years. Education is becoming almost impossible for many of our young people to access at any cost. Tuition increases are prohibitive. They are encouraging some of our young people not to become educated and as a result they will be faced with tremendous unemployment problems as they go through their lives.

The bankruptcy problems of young students and the change the government made to make it more difficult for students to declare bankruptcy is shameful. It does not serve young Canadians well. It does not serve students well. It is almost discriminatory against young people who have worked hard to obtain an education. If we combine that with some of the out-migration because there are no job opportunities in Canada, we begin to see a fuller picture of the problems facing post-secondary students.

Bill C-316 is an improvement. Our caucus will be voting for this improvement. If nothing else, it at least acknowledges the fact that an investment in education is an investment for the benefit of the country. As such students should get a tax break because they have invested in many ways as businesses do in their education, which makes Canada a stronger, better and more productive country.

The bill will allow all students to be treated fairly, those who can access the Canadian student loan program and those who have to go through private sources of lending such as banks or other sources. If they are attending school and require a loan from a private source, a bank or whatever, at least now students involved in the post-secondary system will be treated fairly.

In conclusion, we in our caucus will be supporting the bill. It shows that the government is at least beginning to think in the right way and look in the direction of post-secondary students, education and its value into the next millennium.

We do not agree with some of the other government programs, but in this case the member for London North Centre and his caucus colleagues have brought forward a bill that makes some sense to students and will make their lives a bit easier. It will get the full support of the Conservative caucus.

[Nick Discepola, Liberal, Vaudreuil—Soulanges, QC]

Mr. Speaker, we are here tonight to debate a bill which I consider very important for Canadian students.

This bill is aimed not only at helping students have access to post-secondary education by allowing them to deduct their annual interest payments from their taxable income for a particular fiscal year, but also at reducing their overall tax burden.

It is worth mentioning that, for the 1997-98 school year, each student who graduated had a average loan of $25,000 to pay off. If that loan is paid off over a period of ten years at a 10% interest rate, the person will pay almost $15,000 in interest charges alone.

For the majority of students, monthly payments leave very little money, even for their basic needs. By amending the Income Tax Act to give students the possibility of reducing the interest payments on their loans, this bill recognizes education as an investment in our country's future.

As a government, we firmly believe in the importance of education for the future of our young Canadians. This responsibility belongs to us all. For this reason, we have taken the necessary measures to invest in education. We recognize the need to remain competitive in a global economy. That means we need workers who have the required education and training to provide a skilled workforce. This benefits the Canadian economy, but it also benefits young workers who, with a good education, are in a better position to find permanent jobs.

We need only look at the figures to see that education is increasingly important for the future of our students. The number of jobs requiring university graduation or college training has increased by 1.3 million since 1990.

On the other hand, the number of jobs available to individuals without education has dropped by more than 800,000. These figures clearly show the need to promote education among young people.

As a government, we put a lot of our efforts into measures promoting education. In September 1997, we proposed a strategy to give young people scholarships for the new millennium. Regardless of the objections put forward, the essence of these initiatives is that the scholarships will give students additional funds to help with the cost of their education. As a Quebecker, I am proud to be part of a government that invests in such projects.

Starting in 2000, this money will provide thousands of scholarships annually to help young Canadians with low and modest incomes to continue their college and university education. This fund will be managed by an institution at arm's length from the government and will further eliminate barriers to education while rewarding scholastic excellence. Through this program, even more young Canadians will have the skills necessary to develop in a society increasingly focussed on information and new technologies.

The scholarships will support a wide variety of knowledge acquisition and skills development programs. They will be available to Canadians of all ages studying either full or part time at universities, community colleges, CEGEPs or state-supported technical facilities.

This new initiative is in addition to the numerous measures announced in the 1997 budget to reduce the barriers to education. For example, the amount on which post-secondary education credits are calculated has already been raised from $100 to $150 a month, and will go to $200 after January 1998.

In addition, the education tax credit has been expanded to include additional charges by the universities, such as those for library and other services. By virtue of these changes, a student who received combined federal and provincial assistance of $900 in 1995 got $1,200 in 1998.

In order to help parents put more money aside for their children's education, the maximum annual contribution to a registered education savings plan was doubled to $4,000. Now parents will also be able to transfer funds from an RESP to an RRSP if they have unused amounts.

Graduates who are unable to pay back their loans may, since August 1, 1997, defer their payments for 30 months, after the standard six-month period. This change also gives new graduates the time to get more solidly established in the work force before starting to pay off their loans.

In today's society, we know that having a diploma does not immediately open doors to the work force. Experience is also an essential requirement. This is a reality with which young people in search of work are very familiar. We know that it is not always easy to get that work experience, particularly in our field of study. Managers want employees who are qualified, educated and experienced.

The Liberal government is promoting concerted efforts to help young people gain the knowledge and know-how necessary to meet labour market requirements. This is why the Liberal government also included in its youth employment strategy initiatives that will allow young Canadians to get their first work experience.

In February 1997, the Liberal government launched the youth employment strategy, which seeks to help young people make the transition from school to the labour market by developing long-term opportunities for meaningful careers.

This initiative provides young people with training and internship opportunities, job opportunities, and information on the job market. For 1998-99, the strategy has a budget of $427 million. It is estimated that this initiative, which includes the efforts of the private sector and associated groups, will provide at least 95,000 internship opportunities per year.

For example, the federal public service internship program will provide a one-year apprenticeship to 3,000 young people. Other internship programs will also provide a work experience to 8,000 graduates, in growth sectors such as science and technology, the environment and international trade.

By investing today in helping young Canadians gain the knowledge and experience necessary to work in an economy dominated by new technologies, the government is ensuring Canada's future prosperity.

We are aware that students' indebtedness is a real problem. This is precisely why the 1998 budget was called the “education budget” and included major measures to help students manage their debt. These initiatives include the millennium scholarships, to which I just referred.

In the last budget, we also introduced the following changes: tax relief for interest payments on loans; extension of the interest exempt period; and assistance to reduce the debt.

As for adults who wish to update their skills, we allow them to take money out of their RRSPs.

All these initiatives show that this government firmly believes in the importance of education. It is a priority for us. We want to invest in future generations to ensure the best possible future for Canadians.

[Tony Valeri, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, I will be very brief. I wanted to stand in the House this evening and applaud the member for London North Centre on his concern for students and for bringing forward Bill C-316.

Under the existing legislative provisions students have a credit for tuition fees in an education credit as well as government support in the form of Canadian and provincial loan and scholarship programs. However, growing indebtedness has put many Canadian students and graduates in a difficult situation. That is why the government supports the spirit of the bill, which is designed to facilitate repayment of student loans.

The substance of the bill was an integral part of one of the measures proposed in the 1998 federal budget. The 1998 budget proposed the introduction of a 17% credit rather than a deduction. Only loans obtained under the Canada student loan program and equivalent provincial programs will qualify for the credit. Although the credit is not transferable, it may if necessary be carried forward and used in one of the five years following the year of interest payment. The government believes that the measure proposed in the 1998 budget meets objectives through reducing the burden of student debt for taxpayers with limited capacity to repay and limiting the possible risk of abuse.

The question is often whether it should be a credit or whether it should be a deduction. It is always an issue of debate when it comes to these types of issues. It has been argued that a credit is preferable to a deduction because it provides fair and equitable support to all taxpayers who are repaying loans. There are often many accountants who come before committee or many individuals who are familiar with the tax system who often argue in favour of a credit rather than a deduction because it is in the eyes of those individuals fairer and more equitable.

As I said earlier, the government fully supports the initiatives that will ease the debt burden of students and believes that the carry forward of unused credits should allow the full use of that credit.

The government agrees with the substance of Bill C-316 and that is why the government put forward the proposals it did in the budget and believes that it will provide targeted relief to the graduates who need it most. I to congratulate the hon. member for bringing this forward.

[Peter Adams, Liberal, Parliamentary Secretary to Leader of the Government in the House of Commons]

Mr. Speaker, it is a pleasure for me also to join in this debate on Bill C-316 presented by the member for London North Centre. Like others this evening, I congratulate him for bringing this bill forward.

The purpose of the bill is to allow those paying off student loans to deduct the interest on the loan from income for tax purposes. This bill is an attempt to deal with the increasing problem of student debt. All across Canada students in universities and colleges are facing steadily and steeply rising costs, increases in tuition and increases in other fees.

We know this is not something that can be solved by a single action or even by a few actions by government. The best way to deal with debt is to avoid it. I know the member for London North Centre knows this.

The government is making great efforts to help students avoid debt. For example, as the member mentioned, the changes in the RESPs now include grants so that families which are putting money aside in RESPs now get grants that match to a certain level the money they are putting aside. So we actually have grants which help students avoid debt.

The millennium scholarships have been mentioned in a negative way by the member from the Bloc. In effect the millennium scholarships are also grants. A substantial number of those scholarships, $100,000 a year for 10 years starting in 2000, are in effect grants. They will be based on need. Some will of course be based on merit but many will be based on need. I cannot understand how the member from the Bloc can oppose such a program.

Also to help avoid debt, the government has done its best to help students find work before they go to college or university, while they are at college or university and in their years immediately following graduation. For example, the federal government's summer job programs have increased greatly since 1994.

Another simple example of helping students find jobs is our increased support for the research grant councils, the NSERC and SSHRC and the Medical Research Council. Those moneys which go into research programs on our campuses rapidly produce jobs for students while they are in school, helping in labs with experiments and things like that, and jobs during the summers on research programs of various types. Those jobs provide money which helps the students avoid debt, but they also provide education. One of the greatest ways to learn is to work in jobs of that type. They also provide the students with this invaluable experience for when they graduate. They can get a job which will help them again avoid debt.

In our increased support for science in the federal line departments it is the same thing. An example, although it is not a department, is the National Research Council. Its funding goes to, among other things, helping students find meaningful work in science projects all across the country.

Another way we have tried to help students avoid debt is by simply eliminating the deficit and stimulating the economy and bringing the interest rates down. The unemployment rate in Canada now is at its lowest level in 10 years.

The renewed national youth strategy was announced yesterday in the west by the Prime Minister. All those things are designed to help students find jobs, have money and avoid debt. But when they are faced with it, which Bill C-316 addresses, the question is how to cope with it.

As he and others have said, we have already improved the Canada student loan program. There is a longer period of time after graduating before students have to start paying off the loans. We have special measures for students who find exceptional difficulties after they graduate in dealing with their loans. There are extra funds, as the member for London North Centre mentioned, available now for loans and more flexible ways for paying those moneys back.

Bill C-316 deals with the interest aspect. I agree with the member for London North Centre that this is an investment on the student's part. It is exactly like the business owner who gets a tax benefit on the interest for business investment loans. There is no difference. The member for London North Centre is right.

I understand there is a similar program in the United States which has been operating effectively for a number of years. The Canadian Alliance of Student Associations, which I am sure would support this measure, has pointed out in its recent brief that it is not just tuition which is increasing. There are now many compulsory student ancillary fees. They are not really ancillary fees anymore. A student cannot go to college or university without paying these fees anymore than he or she can go without paying tuition.

The Canadian Alliance of Student Associations urges that student ancillary fees should also be tax deductible. I am sure that group of students at least, and many others across the country, would support the member for London North Centre and Bill C-316 in the first step which is to make the interest on student loans tax deductible.

[Gerry Byrne, Liberal, Parliamentary Secretary to Minister of Natural Resources]

Mr. Speaker, I am delighted to say to the House and to the member who initiated this bill that I offer my congratulations and on behalf of the House and this side we are very grateful. We are indebted to the member for bringing once again the concerns of students and higher education into the forefront of parliamentary democracy.

We need more initiatives and good ideas to present to young people, in particular those facing significant student debt problems. This is one measure which the Department of Finance and Revenue Canada should be looking at very seriously. It complements a series of measures which the government has already implemented, measures which were described in detail by other members.

This is the type of debate that students are expecting of the House and the type of good ideas that should come forward.

[Joe Fontana, Liberal, London North Centre, ON]

Mr. Speaker, I say to all members who have spoken and other members who have indicated their support for this bill how appreciative and encouraged I am by their support.

Some people have addressed issues that continue to be a challenge for governments, federal and provincial, relating to accessibility and affordability of education. But the fact that everyone talked about the importance of education is a highlight in itself. Everyone recognized education is the key to providing hope and opportunities for our young people. We know the economy of tomorrow demands an education. We have to look at all measures. The bill is not perfect.

I introduced Bill C-316 over a year ago and I am happy to see a lot of the provisions in the bill, including the deductibility of interest which has for the first time been introduced as changes to the Income Tax Act in our last budget.

There are a number of initiatives that our government has taken into account with regard to education. We know that education is a provincial jurisdiction. We know that the provinces set the tuition fees. We know that the provinces set the curriculum. What Canadians have told us is that regardless of the fact that government is really responsible constitutionally for education, parents, grandparents and young people themselves want all governments to work together toward education and ensuring that every person who wants to get an education is not deprived of getting that education through colleges or universities or other institutions by virtue of the fact that they do not have any money.

Surely we have learned that regardless of where you live, regardless of your socioeconomic stature, you should be provided the opportunity of education. We know education leads to a much more prosperous life. Hence the government's initiatives, including this bill, hope to address the question of student indebtedness, accessibility and affordability.

I look forward to the support of the House and the support of the government to move on the next part of my bill yet to be addressed by the government, to make sure that all student loans, not only the ones that are under the Canada student loans program, are tax deductible to ensure fairness and equity for all students, not only those who got the money through the Canada student loans program but who went to their banks, their credit unions, their trust companies or other financial institutions to borrow money to further their education and invest in themselves and in the country.

[The Acting Speaker (Mr. McClelland)]

There being no further members rising for debate and the motion not being designated a votable item, the time provided for the consideration of this item under Private Members' Business has now expired and the order is dropped from the order paper.

Pursuant to Standing Order 30, the House will now proceed to the consideration of the next item under Private Members' Business as listed on today's order paper.

Energy Efficiency Strategy

[Pat Martin, NDP, Winnipeg Centre, MB]

moved:

That, in the opinion of this House, the government should invest in a comprehensive energy efficiency strategy, thus: (a) exploiting the considerable job creation potential of energy efficiency; (b) encouraging the development of high tech expertise and export opportunities; and (c) increasing the number of federally owned buildings (of which there are 50,000) retrofitted for energy efficiency through the Federal Buildings Initiative.

Mr. Speaker, I welcome the opportunity to speak to this motion. I have been quite anxious to introduce and to encourage this concept of job creation through energy conservation for quite some time.

I start by saying thank you to the committee for ruling that this motion be deemed votable. I appreciate that very much. I understand that this is the only motion of the current batch of motions in Private Members' Business that was deemed votable in this round.

The concept is job creation through energy conservation. Although the motion could be worded better, I look forward to the opportunity to try to explain what that means.

We believe that the situation does not have to be jobs versus the environment as is so often the case. I would like to demonstrate how the situation can be jobs and the environment. In other words I point to, focus and showcase the enormous job creation opportunities involved in the energy retrofitting of our publicly owned buildings.

As a carpenter by trade I spent much of my working life building megaprojects. I built energy generating stations. For many years of my career it would be heresy to actually advocate harvesting units of energy out of the existing system rather than building new generating systems, whether they were nuclear power plants or hydroelectric dams. Obviously that was the kind of work that we looked forward to as tradespeople. Like many others, I would drive across the country to try to get on one of those megaprojects.

The original research paper on this subject was done in 1993. This idea came to fruition because the province of Ontario cancelled a huge energy purchase from my province of Manitoba. Thus the Conawapa hydro generating station which was about to be started had to be cancelled.

Many tradespeople were anxiously and eagerly awaiting Conawapa. This was something we were looking forward to. Five years of work for skilled tradespeople was nothing to be sneezed at. When the province of Ontario cancelled this project we were devastated.

At that time I was representing the carpenters union in the province of Manitoba. We had 1,200 members who were anxiously waiting to build Conawapa. It was something we wanted to do. When it was cancelled these people literally did not know which way to turn.

That led us to investigate other ideas. How would we put these people to work? We commissioned a study on the idea of job creation through energy conservation. We wanted to find out what kind of job opportunities there would be in harvesting units of energy from the existing system through demand side management techniques rather than building new generating stations.

We were happy to find out that there were as many as seven times the number of jobs per $1 million invested, or per $1 invested, in the demand side management of our energy resources than there were in building new generating stations. This came as a huge relief. We could now advocate a green environment by being good environmental stewards without shooting ourselves in the foot. It would have been heresy not too many years ago for a carpenter to openly promote this demand side management rather than build new generating stations.

This is what led us to this conclusion. For many years we have been pushing this idea. We have been training our people in anticipation of this idea catching on.

In this motion I point to the federal government owning 50,000 buildings. In its literature it is actually 68,000 building that the federal government owns and operates. It does have some measures under way. Nobody is trying to say that the federal government is doing nothing in this regard. There is the federal building initiative program. Its goal is to try and conserve energy within publicly owned buildings.

Of those 68,000 buildings the government owns and operates, the federal building initiative has only done about 100. With my motion, we are hoping to make the argument that we could do as many as a couple of thousand per year and put a whole industry back to work in this new and laudable concept of demand side management.

I do not believe that we are taking full advantage of this opportunity if we are only doing a couple of projects a year. The federal government's web page is almost a brag sheet about the federal building initiative. The savings are unbelievable.

One example I pulled off the web site shows that Public Works and Government Services Canada upgraded a 500,000 square foot building in Calgary. I believe it was the Harry Hays building. It resulted in an energy saving of $300,000 per year. That is for one building. We created a lot of jobs. Obviously the manufacturing sector benefited as well because there was the installation of new lighting fixtures, HVAC systems and smart boilers, et cetera. And we saved $300,000.

We spend over $800 million in energy costs per year to heat, light and cool all those 68,000 buildings.

In the document “A Brighter Future: Job Creation and Energy Efficiency in Manitoba”, research shows that we can achieve an energy savings of as much as 40% by introducing many of the high tech systems that are currently available. Many of the buildings the government owns and operates are old and outdated. They were built in a time when energy was not an issue, when energy was cheap and plentiful.

I remember the time when Ontario Hydro and Manitoba Hydro ran ads on TV advocating more use of energy. They wanted us to do everything electrically, to turn on the lights. We cannot do that any more.

There is another upside to what I am trying to introduce here. First is the job creation aspect. As carpenters, that was our first motivation and the reason we got into this. The second is the cost saving for the owners of the public buildings of up to 40% of that $800 million a year. The third very good argument is that we could help to meet our commitments made at Kyoto and Rio de Janiero to reduce harmful greenhouse gas emissions.

The federal building initiatives web page lists not only how much money it is saving by doing these buildings, it also lists how many millions of kilos of harmful greenhouse gas emissions it is saving per year. Some of these buildings are belching out unbelievable amounts of pollution. If we are going to be examples to private sector businesses in asking them to clean up their act and reduce harmful greenhouse gas emissions, surely we have to start with our own buildings. Surely we can demonstrate to the private sector that not only is it a good idea and good environmental stewardship to reduce energy consumption and eliminate waste, but they can also save a fortune by doing it.

This is why I believe that the federal building initiative, the program which is already in place and which I am not critical of at all, should be expanded tenfold. If 100 buildings have been done so far and there are 68,000 buildings to go, what are we waiting for? We could put a whole generation of tradespeople back to work. We could finally get some young people coming into the skilled trades, which is a real problem.

In the trade that I represent, the average age of a tradesman is 48 years. These guys are looking for a way out by the time they hit 50. Their knees and backs are gone. Young people are not choosing the skilled trades as a career option because the work is so spotty. This project could be a decade long program to get our buildings up to world class standards.

Besides job creation, obvious cost savings and environmental stewardship, the fourth benefit is the research and development that goes into this new high tech field. We could show the world. We could be the centre of excellence for environmental stewardship in terms of living in a harsh northern winter climate and show that it is still possible not to be wasteful in our energy use. We could export the engineering and research that we do.

We are already leaders in many aspects. There is the window industry, for instance. I do not think anybody in the world makes better windows than our own companies, such as Loewen windows in Manitoba. They export all over the world. They are leaders.

There are other aspects of energy retrofitting. We embrace this concept but one caution I have is there is a real temptation when one gets involved in energy retrofitting to pick the low hanging fruit, the easy stuff.

For instance, anybody can change the light fixtures to more energy efficient ballasts. That is okay. It is all very well and good and one might get a very quick payback on one's investment. But when one goes to do the building envelope, the much more expensive things, insulation, windows and doors, the payback might take eight years or so. Average the two together and there might be a three or four year payback on one's investment. Most property owners will tolerate that. But if one picks the low hanging fruit and only does the easy stuff and does not do a comprehensive energy retrofit, it renders the other details less economical.

The real clinger here, the real thing I hope to excite people with is that everything I have talked about so far can be done at absolutely no cost to the taxpayer. Free. Revenue neutral. Not a penny. Private sector investors are standing by ready, willing and able to finance all of these retrofits. As many as we can throw at them, they are happy to underwrite, to pay for and to be paid back slowly out of the energy savings.

It is called the ESCO industry, energy services contracting. Many private financial institutions are involved. It is a very high tech field. Some of the best engineering firms in the world are doing the energy audits first of all.

All the federal government would have to do is to let us use its buildings to create jobs, reduce its operating costs and reduce harmful greenhouse gas emissions. What are we waiting for? Instead of doing 100 of these projects over the five years that the federal building initiative has been in place, why are we not doing 10,000 of them? And why are we not doing outreach to show those in the private sector how it can be done and that they should be doing it too?

The whole idea of reducing our greenhouse gas emissions has been viewed in a very negative light. Here we can point to a very positive side of it and we can save a fortune.

The province of Manitoba spends $3.2 billion a year on energy. Every dollar that is not spent on energy can be spent elsewhere in the economy.

The whole concept of demand side management and energy retrofit is almost too good to be true. It is such a win-win situation. Any unit of energy that we harvest from the existing system by demand side management measures is exactly the same as one produced in a generating station, except for a couple of important things. For one thing it is available at one-third the cost. One-third the cost. The American research shows this. It is on line immediately. At the same instant one introduces demand side management measures in a building, the energy is on line immediately instead of waiting five to 10 years for a generating station to be built and to get on line. No additional infrastructure is needed in terms of distribution. And it creates seven times the number of jobs. One would think that would be really smart.

Frankly the Americans are way ahead of us on this. The Bonneville hydro authority has precluded the need to build seven nuclear power plants just by its demand side management program. Seven nuclear power plants at $10 billion each. That means it does not have to borrow that money on the open market. It does not have to pollute the environment with seven more power plants, although it is arguable whether they pollute or not. The hydro authority saw the sense in this and really embraced it wholeheartedly. The Tennessee Valley hydro authority has similar statistics.

I do not know why we are so slow on this. We live in a harsh winter climate where energy costs are a huge issue. Why are we not showing them how it is done instead of the other way around? I believe this is possible.

People ask what the motivation is behind this. Frankly I sound like a broken record. I came to Ottawa in 1993 to pitch this at an energy efficiency conference at the minister's request. I was given the energy innovator's award by the then minister of natural resources. Everybody said that it was fabulous and great, that it was a public-private partnership.

One source of venture capital for this was union pension funds. We pulled together a pool of union pension funds dedicated to this project, $150 million of dedicated capital ready to go. We said “We have H.H. Angus, one of the best engineering companies in the world to do the auditing. We have the financiers in place. Just let us use your buildings”. Nothing. Frankly, it did not really go very far.

Other financiers are in place and are underwriting the 100 projects done by the FBI but at a much greater mark-up. They want a much greater rate of return on their investment. Pension fund investors are happy to have a slow, steady, guaranteed rate of return, which is what makes it such a good investment for them.

The study we did called A Brighter Future is in its fourth printing now. Groups as diverse as the James Bay Cree have been asking for copies of it because they have a vested interest in reducing the number of hydro projects given the impact they have on northern communities. In Manitoba we are still dealing with the flooding of South Indian Lake.

Building a hydro project on a river is radical intervention in an ecosystem. We cannot enter into that kind of project lightly. It is irresponsible not to do everything in our power to look elsewhere for our energy. Building another generating station should only be a last resort. Certainly we will build more generating stations someday, but until we harvest every unit of energy we can out of the existing system it would be crazy to borrow $10 billion to build another dam. It is just irresponsible.

There are many measures in energy retrofitting. Rather than getting into the complicated technical side of things, I would like people to think of their own homes. We have known for years that an energy saving shower head that is worth about $15 can save $75 a year, but how many of us have actually gone down to Canadian Tire, paid the fifteen bucks and screwed the shower head on at home? We are stupid if we do not. We can save $75 a year for a $15 investment. That is how painfully obvious the measures are. The measures that need to be taken in buildings like the Wellington Building are that obvious to engineers. Why do people not do that?

Now we have taken the last obstacle away. What if one does not have the $15 to buy the shower head. We can do it free of charge, at no cost to the government, zippo, free, gratis. There would be hundreds of thousands of jobs with no charge to the taxpayer. We could reduce greenhouse gas emissions and save 40% of the $800 million per year that we currently spend on energy to heat and light 68,000 federal government buildings. What are we waiting for?

The whole industry is anxiously waiting to get started. The carpenters union in partnership with contractors across the country are running courses on energy retrofit construction, new vapour barrier and insulation systems. They are eagerly awaiting and anticipating this volume of work. The sheet metal workers union is specializing in various HVAC systems, the heat exchangers, the balancing, et cetera. Electricians are one of the groups that has offered to use some of its union pension funds because it will create jobs for its members. It is an ethical investment and it is good work.

There is another advantage to having the work in demand side management measures rather than in the construction of new generating stations. When a hydro dam is built all the jobs are concentrated in some isolated bush camp in the middle of nowhere. With demand side management measures jobs are spread evenly throughout every community in the country. Everywhere there is a publicly owned building is where the jobs will be. There may be 30 jobs to renovate a post office or 30 jobs to renovate a building on a military base. Those jobs will be more evenly distributed. It would be a far more equitable type of project.

We could view it as a megaproject but it is spread over the country. It would put an industry back to work. It would help us to embrace the idea of public-private partnerships in a very positive light.

Let the industry pay for it. It just wants to use the government buildings. It wants to help the government meet its Kyoto targets and bring down greenhouse gas emissions. Job creation for energy conservation is an idea whose time has come. It is long overdue. I welcome the support of other members in this regard.

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

Mr. Speaker, it is interesting to listen to talk on a motion with which the government and I concur. It is an excellent motion. We will be supporting it when it comes time to vote.

I am pleased to speak to the motion brought forward by the member for Winnipeg Centre. We appreciate the opportunity to speak about the government's commitment to energy efficiency. We know we can do more. We thank the member again for bringing it to everyone's attention. My comments today will focus on the government's federal buildings initiative and specifically on the role of Public Works and Government Services Canada in this initiative.

Energy efficiency makes sense not only for government but for all Canadian homeowners, drivers, businesses and industry. Energy efficiency is a winning strategy for reducing greenhouse gases, for promoting a competitive economy and for creating skills, sustainable jobs and expertise in high tech fields as was pointed out.

The federal government must show leadership on this issue. The best way to do that is through action rather than words. The Department of Public Works and Government Services is a common service agency providing a wide range of services to federal departments and other agencies. The department's mandate provides the unique opportunity for helping client departments identify and implement best practices in the areas of procurement, fleet management, waste management, water conservation, land use management and energy efficiency.

As a major property owner in Canada with about 350 office buildings and close to 2,000 lease contracts within Public Works, it is a unique position to promote and implement energy management initiatives such as the federal buildings initiative. If the other 16 departments under the Government of Canada, such as Health Canada, National Defence and Revenue Canada, are added we either own or lease 50,468 buildings. We have downsized the government; maybe their statistics are a little older than mine. It is impressive to know that over 24 million metres square is under government control. Also we have 22,793 vehicles which should be energy efficient as well. The department has been an active player in the development of this initiative in concert with Natural Resources Canada.

The federal buildings initiative helps federal departments and agencies reduce their energy consumption and greenhouse gas emissions by improving the energy efficiency of their buildings. This is achieved through partnerships with the private sector and at no upfront cost to the taxpayer.

In these times of fiscal restraint it is fair to ask where the government is finding the money to invest in energy efficiency. The member opposite talked about trade unions and various other organizations which have gone into partnership to improve energy efficiency. The answer is to get a willing third party, an energy service company to find the money for us.

The company provides the capital, implements the project and assumes any risk associated with it. Once the project begins to reduce energy consumption, the energy service company recoups its investment from the dollar savings. After the company is repaid, which may take as little as two years, the savings then go to the taxpayers. This innovative financing strategy effectively means that energy efficiency retrofits are paid for through the savings they generate. At the end of the day everyone is a winner. The federal government gets to upgrade its facilities with modern equipment and technologies at no new cost.

I must make a brief aside. I have been married to an engineer for 30 years. His idea of energy efficiency is the new shower head. He has gone around the House and put a brick in the water tank of each toilet. I asked what he was doing and he said it was a very technological advanced way of saving water.

The federal government upgrades its facilities with a little more finesse, with modern equipment and technologies at no new cost. Energy management companies generate new business and make a reasonable return on their investment. Canada increases its global competitiveness by developing high tech expertise and a skilled workforce in this field. Energy efficiency upgrades require a combination of new equipment and systems, technological expertise and labour. That means more Canadians are being put to work, as the member opposite pointed out.

Job creation is a priority of the government. The growing demand for energy efficiency retrofits is helping energy service companies prosper and generate new jobs. Federal buildings initiative projects in the federal sector alone have a potential to create some 20,000 person years of employment.

I would like to share some very impressive figures. I think the House will be interested in them, not that is it jam packed. To date the Department of Public Works has signed 27 contracts representing about $32 million in energy investment by the private sector. This generates over $5.5 million in annual energy savings, reducing CO2 emissions by 20,000 tonnes per year, 5.25% from the 1995 levels, and creating in the process 640 jobs.

By the year 2000 public works will have reduced energy consumption by approximately $12 million per year and have reduced CO2 levels by 14%. This is an important element in the government's initial response to meeting the greenhouse gas commitments made in Kyoto last year.

Through the federal buildings initiative Public Works and Government Services Canada alone will generate about $60 million of private sector investment and will create approximately 1,200 jobs in the private sector.

At the same time as the department of public works has been implementing federal building initiatives projects it has also proceeded with a unique project in a leased facility. The Place Vincent Massey building, a complex which is leased by the government, underwent an impressive $1.4 million in energy upgrades which will achieve a potential $200,000 annually in energy cost savings. As a result of this success, public works is now pursuing federal buildings initiative projects in all the leased buildings it manages. This means even more savings and more job creation.

I am pleased to report to the hon. member for Winnipeg Centre that included in the 27 projects public works has already signed, four contracts for 12 buildings were awarded in the western region. The member may also be interested to know that four of these buildings are located in Winnipeg. Overall these contracts represent an investment of close to $4 million by the private sector, generating approximately $650,000 of energy savings and creating 73 jobs.

The Department of Public Works and Government Services is not alone. Virtually every federal department that owns buildings has made a commitment to pursue this unique opportunity.

In addition to launching its own projects, public works will help other departments implement the federal buildings initiative by undertaking project management on their behalf. I think that is why the hon. minister we have now was put into his position. When we were first elected in 1993, he went through and slashed budgets. Nobody could paint offices. He was a real tough character. He has been put in charge of this initiative. With his broad expertise in energy management and wide range of property management services, public works is well suited to the task as is its minister.

What is particularly exciting about the federal buildings initiative is that it can be easily replicated by other levels of governments and other sectors of the economy. Public works has been working in partnership with other levels of government, federal, provincial, territorial and municipal. Let us not forget that businesses, hospitals, schools and universities can all use the federal buildings initiative approach too, and many are. In the end everyone benefits from the federal buildings initiative: the government, the private sector, the taxpayer and our environment.

I assure the member for Winnipeg Centre that the federal buildings initiative program is alive and well. The government is committed to seeing that the program is implemented whenever and wherever it makes sense. We welcome the hon. member's support and I encourage him to follow the federal buildings initiatives progress as we make our way through the full inventory of federal buildings.

[Dave Chatters, Reform, Athabasca, AB]

Mr. Speaker, after listening to the two previous speakers I cannot for the life of me understand why every small business and homeowner in the country is not busy retrofitting their homes for energy efficiency.

[An hon. member]

Motherhood and apple pie.

[Dave Chatters, Reform, Athabasca, AB]

Yes, the issue is motherhood and apple pie. It is pretty difficult to say that it is wrong. The idea has a lot of merit, but I have some concerns with the member's motion and the federal building initiative it is based on.

I recognize and I applaud the hon. member who presented the motion on his demonstrated commitment to the issue and his efforts in working in energy efficient strategies for many years in his home province of Manitoba.

While I have some reservations regarding the simplicity of the motion and the specific program, the FBI the member endorses, I agree there certainly is a need in the country for his comprehensive energy efficiency strategy.

The development of long term strategies is one of the government's demonstrated weaknesses. One has to look for evidence only to its handling of the Kyoto conference last December, the issue of gasoline standards in Canada and certainly the issue of air quality standards in Canada.

The Kyoto example is certainly one of the better examples. Canadians everywhere were imploring the government to make its position and strategy known prior to going to Kyoto and this information was still unavailable right up to the day the delegation left for the summit. It was apparent that the government had no clear strategy going into the conference and was watching for other countries to lead.

Now, a full year later, even after Rio, the government still has no concrete plans or strategy for the implementation of the commitments made at Kyoto. Throughout the entire process the government presented a one-sided argument in an effort to sway public opinion.

While it was widely agreed that the measures needed to be taken and some commitments made, Canadians were only given half the information and were not and have not been invited to participate in the process. If this government is to develop a comprehensive energy efficiency strategy, as I believe it should, it must engage Canadians and open up the process so that Canadians get the full and honest picture of the benefits and costs.

This leads me to my first concern with this motion. The member for Winnipeg Centre endorses a retrofitting program called the federal building initiative. Through this program federal departments may retrofit federal buildings for greater energy efficiency. Departments pay the cost of the renovations out of the savings on energy bills over a negotiated pay-back period. At first glance this program seems ideal and it certainly does have merit. It would lead one to say “What is holding us back? Why are we not going at this full bore?”

However, it is impossible to make a fair assessment when only half of the information is available and has been presented.

Despite my interest in energy efficiency and my role as the natural resources critic for the opposition caucus, I have been able to get only very limited information about this program.

If the program is successful and worthy of Canadian support, why is more information not being made available? Too often the government aggressively promotes a program, only to ignore it after implementation or to provide only information that it deems to be supportive while it suppresses all other information. Programs fail to live up to expectations and are therefore kept from the public spotlight. Canadians deserve more in the way of feedback and regular updates on the success or failures of programs that cost millions of taxpayers' dollars.

When I began researching this program I asked for a cost breakdown of one or two examples of contracts that we might examine to assess it. I was curious about the size of the profit margin that would be incentive enough for a private sector energy service company to enter into a contract in which it is not paid in full for up to eight years. It was a simple enough request, but I have not yet received an adequate response.

I also requested complete information on the specific retrofitting projects identified as the government's success stories on its natural resources web site which other members have referred to. Three such examples were listed on the web page alone with the annual savings reaped by retrofitting each facility. I was informed that a case study exists about one of the facilities, but I have yet to see that study in any detail. We were provided with only three pieces of information. The total annual savings were $880,000 on that particular project, the amount of the contract was $6.1 million and the pay-back period was 7.1 years.

I am hesitant to endorse this program until I have received more information about it. However, gathering information has certainly proved to be an onerous task.

I therefore have to question how the public can fairly assess such a program when information is so difficult to obtain. I can only assume that they will base their assessment on the relatively few facts provided by the government, thus making their judgment on partial information.

This is a prime example of the lack of government transparency that is to be avoided in the development and implementation of a comprehensive energy efficiency strategy. The federal building initiative may be a raging success or it may be an abysmal flop for all we know from the information we seem to be able to get on it. Either way there needs to be greater public accountability through detailed reports showing the progress of the program.

I also have some concerns with the tendering process espoused by the federal buildings initiative. Through this program federal departments are given significant freedom in choosing an energy service company to retrofit their buildings. Unlike other government contracts, the awarding of a retrofit contract is not based on the lowest bid. Departments must take a number of factors into account and may place emphasis where they see fit. Energy service companies must be chosen from a qualified bidders list kept by Natural Resources Canada.

These features of the tendering process blow the doors wide open to patronage, whereby contracts can and likely will be awarded to friends of the government. To avoid or at least to minimize patronage it is necessary to open up the tendering process.

That being said, I would like to express my general skepticism regarding motions and bills introduced by the members of the New Democratic Party.

As a young man I was searching for a home for my political ideology and I looked at the NDP philosophy. It certainly appeals to many Canadians. However, assessing any political ideology is like the retrofit program: if we only get half the story it is pretty hard to make an intelligent and informed decision. Certainly the NDP motion that we are dealing with today fits into that category. Every Canadian wants to live in a free society with zero unemployment, a healthy environment with no poverty. All Canadians share those ideals.

However, I fear that these ideals are in direct conflict with the realities of the day. That is not to say that we should abandon those ideals, but we should be working toward the ideal while recognizing the reality.

Canada does not have a bottomless pit of money to finance government programs and initiatives. All programs come at a cost to Canadians. There are no free rides. In many cases the cost may be worth it, but that does not mean the financial side of the program can be ignored.

The motion points to job creation and the development of high-tech expertise through an energy efficiency strategy. It was my hope upon reading the motion that the member for Winnipeg Centre was talking about jobs created naturally in the private sector, not through substantial investment by the federal government.

Contrary to my hope, in a report prepared by the member, to which he referred, “A Brighter Future: Energy Efficiency and Jobs in Manitoba”, the member for Winnipeg Centre advocates federal funding in a number of areas, but particularly in training workers for the conservation industry.

The motion also calls for the development of high-tech expertise. Again I hope that the member for Winnipeg Centre is talking about encouraging private sector investment in research and development. However, if he is talking about government investment, it is very important that Canadians get a good return on their money.

If high-tech expertise is to be developed through government investment, that expertise must not be patented and sold by the private sector with no return to the taxpayers of Canada. I think the term is intellectual property.

Having expressed all of those reservations, this issue is motherhood and apple pie and certainly our caucus will be supporting the motion when it comes to a vote. However, I would like some of the issues which I brought forward to be addressed.

[Pierre De Savoye, Bloc, Portneuf, QC]

Mr. Speaker, the motion before us focuses more on the economic impact than the environmental impact of an energy efficiency strategy.

You may have noticed that the motion deals for the most part with the economic benefits associated with such a strategy. Basically, it suggests that an energy efficiency strategy would promote job creation while at the same time boosting export opportunities.

In that sense, the motion put forward by the hon. member for Winnipeg Centre hits the mark. There are undeniable financial benefits to energy efficiency. In this respect, the experience of Quebec is a case in point. As the Quebec minister responsible for natural resources, Guy Chevrette, recently pointed out, Quebec has successfully developed a whole economic structure around energy efficiency.

The latest available statistics date back to 1994 but nevertheless speak volumes. The commercial activities associated with the manufacturing, distribution and installation of energy-efficient products brought in nearly $2 billion for Quebec businesses alone. And these activities created approximately 13,000 jobs for Quebeckers.

We are talking about a real industry here, a business that is not only booming on domestic markets but also very promising in terms of export potential. In fact, Quebec's new energy efficiency agency, about which I will say more in a moment, has taken a proactive approach to international relations. This openness to the rest of the world is designed to preserve and reinforce Quebec's expertise in this respect.

In short, the economic basis for Motion M-300 is absolutely sound. However, this motion fails to address the environmental impact, which is unfortunate and rather surprising. More than ever, energy efficiency appears to be an inescapable way of meeting international requirements in relation to climate change and the greenhouse effect. Natural Resources Canada has already started implementing an energy efficiency strategy.

It is well known that the resources now devoted to energy efficiency initiatives are modest. Strategic tools are limited and Natural Resources Canada is focussing primarily on public awareness. The following question therefore arises: are existing initiatives well managed and are they having a real and positive impact on the environment?

In this respect, the 1997 auditor general's report identified the areas in which Natural Resources Canada's implementation of its energy efficiency strategy was weak. The auditor general pointed out that there is no clear link between federal energy efficiency initiatives, on the one hand, and Canada's environmental objectives, such as stabilizing green house gas emissions at 1990 levels, on the other.

Furthermore, the contribution of existing measures to the attainment of stabilization objectives is not being well measured. The department's performance data do not allow this specific input to be measured. Nor do they allow us to measure the overall success of existing energy efficiency initiatives. All this was pointed out by the auditor general in 1997.

Motion M-300 proposes that the government invest in a comprehensive energy efficiency strategy. Logically, the motion implies that the Government of Canada should launch new initiatives. Before doing so, however, the federal government should first ensure that its existing initiatives are having a positive impact, one that is measurable and verifiable.

The motion before us today does not say which department or agency should implement the exhaustive strategy proposed. Caution would dictate better management of existing initiatives before Natural Resources Canada or the new energy efficiency office is given responsibility for implementing new initiatives in this area.

As a Bloc Quebecois member, I am particularly concerned about the question of jurisdiction. Energy is a provincial responsibility. This obviously includes energy efficiency. Furthermore, Quebec is in the forefront when it comes to energy efficiency.

Despite an increase in our population and in our economic activities, Quebeckers use the same amount of energy they did 20 years ago.

This is a testimony to the considerable efforts made by Quebec with respect to energy efficiency. Quebec is leading the way in Canada with its energy efficiency legislation, particularly as it applies to new buildings.

In 1997, the Government of Quebec created the Agence de l'efficacité énergétique. This agency has the backing of all Quebeckers. The legislation that created it was passed unanimously in the National Assembly. The agency will be the focal point for anything having to do with energy efficiency in Quebec.

Agency president Michel Dallaire shared his vision for the new agency last May. I quote:

Between now and the year 2001, the Agence de l'efficacité énergétique wishes to gain recognition as the key Quebec source of reference for energy efficiency and an unbiased promoter of its economic and environmental advantages.

One of this agency's mandates is to support R&D in energy efficiency technologies. This is, in fact, one of the main concerns in the motion by our colleague for Winnipeg Centre.

Of course, the Government of Canada regulates interprovincial commerce involving energy-consuming machinery and equipment. Through its spending powers, the federal government also devotes considerable resources to the promotion of energy efficiency, particularly in the areas of R&D and transportation.

Motion M-300 might be interpreted as being intended to encourage the Government of Canada to broaden its jurisdiction over energy efficiency. The Bloc Quebecois certainly has no intention of helping the federal government to broaden its jurisdiction. The federal government ought not to be needlessly duplicating provincial efforts.

Any major federal initiative in the area of energy efficiency ought to start off by gaining the support of the provinces. The Bloc Quebecois wishes to ensure that increased federal resources for energy efficiency will be used to support provincial objectives and strategies in this area.

If the federal government were to put new programs into place in this field, Quebec and the other provinces ought to be able to opt out of these programs with full compensation. In Quebec, the Agence de l'efficacité énergétique would be responsible for managing the amounts in question, according to its own priorities and strategy.

In conclusion, the economic concerns underlying Motion M-300 are entirely laudable. Investing in energy efficiency can lead to the creation of thousands of jobs and open up new markets for businesses in Canada and in Quebec. The Bloc Quebecois is not questioning this logic. However, economic logic should not be the sole criterion by which this motion is judged.

The primary raison d'etre for an energy efficiency strategy is to improve our environmental performance. Unfortunately, the Government of Canada's track record in this regard is disappointing. Existing initiatives could be much better managed.

This is why we are reluctant to support the motion. Before investing more money, the government must ensure that existing programs are well run.

Furthermore, it is primarily for jurisdictional reasons that the Bloc Quebecois has doubts about the content of this motion. Quebec has its own agency for energy efficiency issues, which will be responsible for all matters having to do with energy efficiency in Quebec.

We wanted to move an amendment to Motion M-300 that would have reflected provincial jurisdictions. Unfortunately, under the Standing Orders, such an amendment would have gone beyond the scope of the present motion and was therefore not allowed, leaving us no choice but to oppose the motion before us.

[John Herron, Progressive Conservative, Fundy Royal, NB]

Mr. Speaker, it is with pleasure that I have the opportunity to speak to the motion moved by the member for Winnipeg Centre. I will repeat the motion as it is very prudent for us to break it down into its parts.

The motion reads:

That, in the opinion of this House, the government should invest in a comprehensive energy efficiency strategy—

The Progressive Conservative Party indeed agrees with that.

—thus: (a) exploiting the considerable job creation potential of energy efficiency; (b) encouraging the development of high tech expertise and export opportunities; and (c) increasing the number of federally owned buildings (of which there are 50,000) retrofitted for energy efficiency through the Federal Buildings Initiative.

I want to talk about the primary origin of why this particular debate is becoming very topical. It comes down to the fact that just over a year ago the industrialized world and emerging nations attended a conference in Kyoto to make a tangible approach to cut down carbon dioxide emissions and fight the serious challenge of climate change.

Over the last 40 to 60 years the use of fossil fuels which we use to heat our homes and drive our automobiles has proliferated the amount of greenhouse gases within our environment. We are now seeing a number of extreme weather events. Last year the ice storm affected my riding of Fundy—Royal. It affected our cousins in the United States and many of our cousins in the province of Quebec. These severe weather conditions are products of what can happen with the continuance of global warming. It is prudent for us to look at this issue.

The government needs to engage in more energy efficiency. Canada has an export driven economy, an economy that relies on our natural resources and an economy that is industrially based. The industrialized world said just over a year ago that it would be investing in energy efficiency initiatives and research and development on renewable sources of energy in order to address the challenge of climate change.

President Clinton and Vice-President Al Gore touched on the fact that the Americans would be spending over $7 billion on energy efficiency initiatives. This issue is just as much a trade issue from the Canadian perspective as it is an environmental issue. One thing we do know is that when the Americans want to engage in a particular topic they usually do it quite well. Given that the Americans will be spending over $7 billion on energy efficiency and they can start spending that money before the senate or the congress actually ratifies the Kyoto protocol, it is a myth that we should wait until it is ratified.

Once the Americans start spending some cash on energy efficiency is when we have to begin. If our American cousins start running their industries in a more energy efficient and cost competitive manner, it would have some very negative implications on our country's competitiveness, on our ability to trade and on the ability of our industries to compete on a cost perspective with our American cousins.

The government speaks quite often about the need to reward early action in terms of climate change. Canadians would be very happy even with some action in terms of actually pushing to ensure that we follow the same initiatives as our trading partners in the EU and the United States.

We do not necessarily see this as an issue that has really caught on with respect to the public, even though the science is definitely very clear. I say that with a little jest because the current government, as we were reviewing the Canadian Environmental Protection Act, built an environmental coalition with the Reform Party. The Reform Party still disputes whether the science on climate change is real. That party probably would, on a different day if it thought it was advantageous, argue that cigarette smoking was actually healthy.

In 1987 a conference was held in Montreal, known as the Montreal protocol. The Canadian government was the principal government in the world and led the world community in making firm commitments to the reduction of ozone depleting gases. That said, ozone depleting gases became something that was in the forefront. The public mindset was that ozone depleting gases were a bad thing for our environment. The government has yet to make that kind of initiative in terms of getting this into the public domain in terms of the need to fight climate change and reduce gas emissions.

I thank hon. members for the opportunity to speak here this evening. The Progressive Conservative Party will be supporting this motion by the member for Winnipeg Centre.

[Gerry Byrne, Liberal, Parliamentary Secretary to Minister of Natural Resources]

Mr. Speaker, I am delighted to rise to address the House on the motion put forward by the hon. member for Winnipeg Centre. I want to thank the hon. member for bringing this matter before the House and commend him for his interest in energy efficiency.

This is a very important issue for all Canadians, for our economy, for our environment and indeed for our quality of life here in Canada. It deserves the careful attention of this House.

In Canada and indeed around the world there is a growing awareness that we need to use energy more efficiently. The combustion, the use of fossil fuels like coal, oil and natural gas produce greenhouse gas emissions that are contributing to climate change and to other environmental problems. Unless action is taken now, future generations will be left with an unmanageable environmental and economic burden.

I am pleased to say that Canada is a recognized world leader in energy efficiency. Between 1990 and 1996, a period during which our economy and population grew significantly, efficiency gains by Canadians resulted in annual energy cost savings that reached $4 billion for the year 1996. Secondary energy use was 3.2% lower than it would have been without improvements in energy intensity. Of course that means carbon dioxide emissions were also lower than would otherwise have been the case.

In his motion the hon. member calls for the government to invest in a comprehensive energy efficiency strategy that will create jobs, lead to the development and export of innovative technologies and demonstrate federal leadership. I am here to inform the House that such a strategy is already in place and is having a clear and positive impact on Canada's economy and on the environment.

The Minister of Natural Resources is a champion of energy efficiency in the government and across the Canadian economy. He has demonstrated this most recently by establishing a dynamic new organization, the office of energy efficiency, which is mandated to strengthen his department's leadership efforts in this particular area. This new organization is an important part of the government's initial response to meeting the greenhouse gas commitments made at Kyoto last December.

The office of energy efficiency is now delivering 18 programs designed to move the market toward increased energy efficiency, including three new programs launched this past April with a funding commitment of $48 million over three years.

Some of these programs provide Canadian consumers and industries with the information they need to become more energy efficient. Others regulate minimum energy performance standards for certain types of energy-using equipment or show leadership through action.

The office of energy efficiency also delivers a financial incentive program to improve the energy performance of commercial buildings.

But market transformation, the changing of attitudes and the removal of market barriers is only one side of the coin. It is also critical that Canada develop technologies, processes and systems that will enable us to use less energy and produce fewer greenhouse gas emissions while maintaining our economic competitiveness in a changing world. Toward this end the energy technology branch of Natural Resources Canada delivers a wide range of programs to support the research, development and application of innovative energy efficiency technologies and processes in all sectors of the economy.

Every project undertaken by the branch is done in partnership with others in industry or the academic community so that taxpayers' dollars are being used to foster investments in energy efficiency. This is an excellent example of how federal spending in strategic areas can also provide value added benefits to society.

The impact of these NRCan programs has been very positive. While the debate has been mixed in the House among those who disagree with the fact that we should be spending any time or energy on energy efficiency versus those who would suggest that we should spend more, Natural Resources Canada is providing a healthy balance in providing market forces and market driven activities which will lead to successful, innovative programs and results.

The hon. member for Winnipeg Centre is quite correct to make the link between energy efficiency and job creation. Every $1 million invested in energy efficiency projects generates 20 years of employment and millions are being invested each year.

[The Acting Speaker (Mr. McClelland)]

The time provided for the consideration of private members' business has now expired and the order is dropped to the bottom of the order of precedence on the order paper.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.