Mr. Speaker, it is my turn to take part in the debate at third reading on Bill C-21, an act to amend the Small Business Loans Act. This is the final debate before the vote that will allow us to dispose of this bill.
This is a relatively brief bill, containing only two clauses. What do these two clauses say? First, that the existing legislation, which would normally cease to apply on March 31 of this year, should be extended for one year. Second, that an additional $1 billion should be made available for other loans.
The auditor general reported on this and we read his remarks very carefully. He suggests changes, and I will come back to this a bit later on.
An in-depth review of the program is required. The Minister of Industry undertook to have one carried out, so that it would not be necessary, as in other years, including last year, to come back to the House each time in order to add another $1 billion and to extend the existing program for another year. The Minister of Industry agreed to allow the Standing Committee on Industry and experts from the department to review the program.
I hope that the business community, people representing SMBs in all sectors of Canada, will be consulted, and that people from Quebec and elsewhere will be able to come and testify.
We have already heard from the Canadian Bankers Association and the Canadian Federation of Independent Business. These organizations recommend a formal review of this program. It will soon be the year 2000. As everyone knows, the economy is in full transition and, unfortunately, the transitions are occurring with greater frequency.
In the past, we saw transitions perhaps every 25 years. Now, economic cycles are much shorter in length, seven years they say. In the era of globalization, high tech equipment, and so on, people are realizing that SMBs are undergoing transitions even more frequently.
The questions asked by the auditor general are extremely important ones. Of course he wants to see more control over what it costs the government to compensate lenders, because a certain number of borrowers, approximately 5% when it comes to small and medium-sized businesses, do not pay back their loans. The auditor general feels that the auditing procedures for these requests for compensation must be tightened up.
He also says that the interest the government would have to pay on compensation must be reduced to a minimum. This needs to be reviewed. I would point out that, with respect to student loans, the Quebec Minister of Education tried to avoid taking anything for granted and decided to renew annually all procedures and mechanisms relating to loans from the caisses populaires and the banks. He succeeded in the end in saving money.
I believe there is always a way for governments to save money, and this money of course belongs to the taxpayers.
In my opinion, the most important element in what the auditor general says is that there must be a more stringent assessment of the program's impact on job creation.
Those who have spoken before me have addressed this point a little, but I would like to take a different tack than the Reform member. I feel this review is worth a serious effort. In the final analysis, if we want small businesses to have access to guaranteed loans, we must remember that what everyone really wants is to see as many jobs created as possible.
The jobs created must be quality jobs. It is all very fine to create jobs, but the statistics are often misleading or incomplete. The type of jobs created, the salary, and whether these are permanent or part time jobs must all be looked into.
We also have to consider whether these jobs are in sectors that will last, because, as you know, a lot of small businesses are failing. Most bankruptcies occur in the first year of business. However, in 75% or 80% of the cases, they happen within the first three years. This is where we must pay particular attention.
Given all the good that this bill can do for business, and I think we must not lose sight of this fact, we are obliged to support it. In the past fiscal year, 34,000 SMBs across Canada benefited from the program. This means that over $2 billion in loans were guaranteed by the government, including $732 million for businesses in Quebec.
How was this $732 million distributed? The caisses populaires loaned out $321 million of it, while the other banking institutions in Quebec provided $385 million. For Canada as a whole, the 34,000 SMBs created, according to the inadequate figures available, 73,000 jobs, of which an estimated 25,000, at least, were in Quebec.
So this is why we in the Bloc Quebecois feel obliged to support this measure. If the bill is not passed by April 1, we could not use it to help small and medium size businesses.
I will digress a bit further here. In 1995, the figures showed that SMBs contributed 43% of Canada's economic activity. That same year, in Quebec, 45% of all jobs, not just the new ones, depended on SMBs. So they account for nearly half of the jobs in business.
We often think that big business creates jobs, but we note—and this is true in all countries, all the OECD reports confirm it—that big business is no longer really creating jobs. It creates some, but others are lost. Often government efforts, and this is true for a business in my riding in Quebec, are aimed at maintaining jobs. Frito-Lay is one example, and there are many others.
On the subject of big business, the challenge is not to create jobs, but to maintain existing ones. The Lévis shipyards come to mind. Barely seven or eight years ago, when things were really booming, 2,500 people worked there. Now they have a hard time keeping 500 to 700 people employed. So SMBs are an area for the future and where most of the jobs are created.
They often represent the only option for someone without a job, who is unable to find one in the public service. We know that neither the federal nor the provincial public service creates jobs anymore. So SMBs are the only option for young people or those who have experience in the labour market, but find themselves unemployed.
I heard the Reform member criticize the Minister of Human Resources Development. But some good came out of the program, including the SEA initiative, the self-employment assistance program, which helped many jobless people, for a period of up to a year, set up their own businesses. Many of these businesses survived. If these people had not set up such businesses, they would have remained unemployed.
We must do our utmost to help them. I do not doubt that all the members here, from all parties, can work so that, in the end, the largest possible number of jobs will be created. The Liberals even made job creation their slogan in 1993, with their “jobs, jobs, jobs”. As we saw, their approach was based on macroeconomics, in that they concentrated on economic indicators and let things sort themselves out.
Contrary to that approach, I think governments still have a very specific role to play to help businesses create jobs. At the same time, we must be careful and make sure public funds are not wasted. The fact is that setting up a business is risky. This basic program allows thousands of businesses to take the necessary risks to create jobs. Members of this House can never make job creation too much of an obsession, too much of a daily concern.
I see that I have some time left. When we review the program, we will have to see which sectors are doing best, which ones are providing quality employment.
For example, in the Quebec City region, socio-economic stakeholders noticed that the number of jobs in the public service was the same, because of a freeze, if not diminishing. This led a number of them to try to devise a strategy geared to the new economy. I want to point out in particular the efforts of the technological park, in Sainte-Foy. There are also other sectors in the Quebec City region that are interested in developing projects that will create quality employment.
I can never repeat it too often: there are sectors where investing makes less and less sense. In the context of globalization, our businesses must be the best in the world, if they are to survive. They must also be in fields that have a promising future.
I will conclude by saying that Bloc Quebecois members will support the bill at third reading, because until a more comprehensive reform is done, it is the only way that other businesses can get a loan from banking institutions in the next fiscal year.