Debates of Sept. 24th, 1998

Income Tax Conventions Implementation Act, 1998

[The Deputy Speaker]

The hon. member for New Westminster—Coquitlam—Burnaby has proposed an amendment to the House. Once again I draw the hon. member's attention to citation 568 of Beauchesne's which states “It is an imperative rule that every amendment must be relevant to the question on which the amendment is proposed”.

With reluctance, the Chair finds that the amendment proposed by the hon. member is irrelevant to the principles of this bill which deals with taxation matters and not with an amendment of the constitution with respect to the Senate of Canada. Accordingly, I must rule the amendment out of order.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, it is my pleasure to speak to the bill on tax conventions. But first, I would like to make a digression similar to that of my Reform colleague earlier. I do not want to take away from this bill, which I consider very important. Tax conventions are always important, as are their provisions.

However, the precipitous drop in the value of the Canadian dollar, its effects on the economy, the three consecutive months of slower economic growth, the declining orders with businesses, all the composite indexes, including those released yesterday by Statistics Canada for the month of August, indicate that we are in a period of economic slowdown. However, the Minister of Finance keeps producing fantastic surpluses every month off the backs of the unemployed, the sick, the provinces, everywhere except his own back.

Instead of using these surpluses to stimulate economic growth, he most unwisely prefers to pay off part of the debt, whereas he should be setting up reserves and using them right now to stabilize the economy. I would like this to have been debated in this House.

It seems to me important that we do not find ourselves in ten months facing the delayed effects of a recession, in a full recession with the loss of thousands of jobs, because the Minister of Finance failed to carry out his responsibilities and failed to use tax revenues wisely to stimulate economic growth, create jobs and reverse the trend we have seen in recent months.

That said, I would have liked such a debate, but I would like to devote the next few minutes to Bill S-16, which I consider very important. It is aimed at implementing three tax conventions, which I will explain later and which were signed between Canada and three countries: Croatia, Chile and Vietnam.

What are these tax conventions? They are agreements Canada has signed with the countries I just mentioned to prevent Canadian companies, for instance, that have branches in Croatia, Chile or Vietnam from having the revenues, capital or profits from their branches abroad taxed twice when these revenues are brought back into Canada.

The opposite is also true. Chilean companies also have branches in Canada. These tax conventions ensure that the same revenues are not taxed twice. This would not make any sense and would be both unfair and devastating at the economic level and in terms of job creation in Canada as well as in Croatia, Vietnam and Chile.

Tax conventions are based on a very good principle. This practice has been in effect in Canada and throughout the world for many years now. Canada has signed dozens of tax treaties with various countries, and that is all very fine.

The problem with the tax treaties or tax conventions we sign with other countries arises when the tax rates in these countries are very different than our own. The difference may be so great that, if revenues are taxed in the other country and not in Canada, there is a terrible fiscal distortion. Also, Revenue Canada stands to lose a lot of money in tax revenue.

Let us take as an example a country like Barbados. Barbados is considered a tax haven, just like Bermuda, Liberia, and other countries. In these countries, the rate of taxation is so low that it is almost non-existent. In Barbados, the maximum corporate income tax rate is 2.5%. For your information, the maximum tax rate in Canada for businesses is about 40%. The tax rate ranges from 25% to 40% depending on the nature of the industry and the tax expenditures applicable to each business.

Therefore, when Canada signs a tax treaty with Barbados, it means that a Canadian company with a branch in that country will pay only 2.5% tax on its profits there and can bring the rest into Canada without having to pay a cent to Revenue Canada. This makes no sense at all. The gap is too wide between the taxation rates in these two countries.

For the Bahamas, it is even worse: the taxation rate is zero. If Canada signs a tax treaty with the Bahamas, Canadian companies that have a branch in that country will pay almost zero tax on their profits there. They will then bring that money into Canada. Since the profits will have already been taxed in the Bahamas, no tax will have to be paid in Canada by the parent company. This creates a substantial imbalance.

That is why, when Canada signs a tax treaty with another country, we have to make sure that the tax rates are comparable, that Revenue Canada will not lose tax revenues and that this tax treaty will not encourage companies to open bogus or even legitimate branches in countries considered to be tax havens simply because tax rates there are very low and because there is a tax treaty. The Canadian company pays tax in that foreign country and does not have to pay tax in Canada, which means a loss of tax revenues for Revenue Canada.

Those who are watching us today should know that it is the people of Quebec and Canada who have to foot the bill for this loss of tax revenues, for those taxes that are not paid in Canada by Canadian companies because of these kinds of tax treaties with countries that are considered to be tax havens. It is the people of Quebec and Canada who have to pay the taxes that these businesses avoid paying through the existence of reciprocal taxation agreements also known as tax treaties.

That is why we have to avoid signing such agreements with countries that have taxation rates that are very different from ours.

Ever since the Bloc Quebecois was elected to this place five years ago, every time a bill to implement a tax convention has been introduced in the House, we have taken these conventions very seriously, as they could ultimately result in tax losses for Canada, which would have to be covered by individual and corporate taxpayers in Quebec and Canada.

Every time, we have carefully considered the conventions on a case-by-case basis to determine whether the countries entering into a tax agreement with Canada had comparable tax rates.

In this particular case, when we checked in the International Tax Summaries, 1998, at first glance, based on the analysis contained in this document and our own analysis of the situation, comparing tax rates with tax expenditures, supply, etc., tax rates in Croatia, Chile and Vietnam seemed to be relatively the same as in Canada.

Personal income tax rates varied between 20% and 35%. As such, a maximum tax rate of 35% is fairly similar to what we find in this country. The maximum corporate tax rate was also 35%. Canada and Croatia basically have comparable rates.

Turning to Chile, again, the maximum tax rate was 35%. So, it is really comparable to Canadian rates. There is no big difference.

In Vietnam, tax rates vary between 0% and 60%. Compared to our 35% to 40%, a maximum rate of 60% may be making this convention slightly unfavourable to Vietnam, as far as individual taxpayers are concerned at least. It all depends on the type of relationship and the subsidiaries that will be established in Vietnam by Canadian interests and vice versa. All in all, as a basis for assessing comparative tax rates, let us say we do not see any problem with this tax convention and we will support the bill.

Since April 1994, when the Bloc Quebecois first intervened with respect to a tax convention bill, we have been asking the Minister of Finance and the government to tidy up some long-standing tax conventions with countries whose tax rates differ radically from Canadian tax rates and, if need be, to set them aside because they create imbalances in fiscal exchanges between Canada and the parties to these conventions, which are considered tax havens.

We have asked the Minister of Finance on countless occasions to update these conventions. As I mentioned earlier, the tax rates in conventions signed with Liberia, Barbados and Bermuda are so low that there is a real shortfall for Revenue Canada. When Canadian companies with branches in these countries realize profits that are taxed at anywhere from 0% to 2.5%, instead of the 25% to 40% they would be taxed at here, depending on the nature of the tax, there is a substantial imbalance.

Distortions are created and there is also a shortfall that can be substantial for individuals and for Quebec and Canadian companies. They must make up this shortfall.

Every time we asked the Minister of Finance to do something about this, we received a completely detached and unconcerned reply, just as each time we asked him to really reform taxation he told us that we had done a good job, that our analysis was correct, but completely side-stepped the fundamental changes that should have been introduced in 1993 after the election. Behind a veneer of equity and fiscal fairness, the Liberal Party talked about overhauling taxation. Once this government was elected, what happened to its concern for tax fairness, for tax equity, and what happened to the promised reform of the Canadian tax system, which is still full of loopholes? Our tax system still includes tax conventions with countries with which we should not have such treaties, because it is very costly for Canada.

Whenever we ask the Minister of Finance to review these conventions with countries considered to be tax havens, he tells us that it is not an urgent matter. He also tells us that, over time, the government will make a few minor reforms here and there.

Yet, it would have been so simple—as we suggested to the finance minister back then and have kept suggesting every year, whenever we have had the opportunity to do so when dealing with other bills involving tax conventions—to correct the situation. A few years ago, the United States and the European countries were quick to react and make adjustments, in light of these imbalances.

Let us say, for example, that Canada has signed a tax convention with a country that has a 2.5% tax rate, as is the case for Barbados, or where taxes are practically non-existent, as in the Bahamas. But let us assume a 2.5% tax rate.

The United States solved the issue by providing a tax credit to companies that have already paid some taxes on profits made by subsidiaries in countries such as Barbados. So, a tax credit is given to American businesses that have already paid a 2.5% tax on their profits. These companies are given a credit equivalent to what they have already paid in taxes to Barbados, but they have to pay regular taxes to the American government.

In other words, if you paid $10 in taxes to Barbados and would normally have to pay $40 in the United States, you now owe $30 in taxes on your corporate profits. The amount already paid in the foreign country is taken into account. This makes it possible to continue to have tax conventions with countries whose tax rates are much lower than ours. A tax credit is granted to companies that have subsidiaries in countries considered to be tax havens, for the portion—however small—of taxes already paid abroad. These companies then pay to the American government the full amount of taxes that they would normally have to pay.

This is not hard to understand. It is logical and it is fair. That is called tax fairness, tax equity, which involves the payment of the money owed, no more, no less, to the government by individuals and businesses.

If a business owes the government money, but through a subsidiary in a country considered to be a tax haven it does not pay its fair share, it is the responsibility of the Minister of Finance and of the Liberal government to recover this money. It does not mean threatening the survival of a business, it means ensuring that all businesses receive the same treatment.

A Canadian business operating on Canadian soil without a subsidiary in a tax haven pays its share of taxation at a rate varying between 25% and 40%. Why then would a business with a subsidiary in a tax haven be required to pay only 2.5% or even 0%? It makes no sense.

There are distortions. There are major injustices. Representatives of business ask us why the Minister of Finance has failed to act in this matter up to now.

The Department of Finance provides little information. It keeps no record of financial losses that occur as a result of these tax conventions. Nor does it keep a record of the number of businesses set up each year so very carefully in countries considered to be tax havens. However, the information we have indicates that nothing has changed. Quite the contrary, the situation has worsened.

Let us look just at the six major Canadian banks. A number of criticisms may be levelled at them, but this one is well founded. The six major Canadian banks have 119 branches abroad, including 57 in the Caribbean, where tax havens abound. There are not a lot of people, and there is not a lot of wealth. What are the 57 branches of the six major Canadian banks doing there? Banking, no doubt, but enough to justify maintaining 57 branches in the West Indies? We need some hard answers.

Earlier I explained how tax havens worked. The tax rate is very low. Revenues and tax losses are allowed to circulate between head office and the subsidiaries abroad. There are tricks to saving taxes and perhaps the banks use them in the West Indies. Of the 119 branches abroad, 57 are in the West Indies. Now that is really something.

On the Cayman Islands, a typical example, the situation has not changed, it has worsened. Around the mid 1990s, in 1994-95, there were 28,000 companies on the Cayman Islands, a tax haven par excellence, for a population of 30,000. That is just about one company per inhabitant. We can see it makes no sense. However, these are the countries we have relations, this sort of tax convention, with. It makes no sense at all.

This is why we keep asking to have things cleared up and a simple rule applied, as the Americans did recently. There should be a tax to be paid in Canada, the usual business tax, and a credit given for the tax already paid abroad—whether it is 15%, 20% or 25%—and the tax payable less the credit comes to something close to zero. That is the way it should be. This way we could say there was no problem for countries we have tax conventions with, if their tax rate is the same.

The credit amounts to the tax they paid there, and the tax payable here comes to zero on calculation. However, when really ridiculously low tax rates are involved, there should be an amount payable covering the difference in tax rates with Canada's higher rate so these businesses do not rob us. I repeat. What they do not pay, the taxpayers pay for them. This is indirect robbery by means of a tax convention that is legal and has the approval of the Minister of Finance.

I have often asked myself why we have a Minister of Finance if he does nothing, if he does not review taxes, if he does not plug tax loopholes and review tax conventions as we ask and if he allows hundreds of millions out of the country as the auditor general pointed out in 1992. Why do we pay him? Why is he there?

My second question was this: Why is he doing nothing? I had my answer less than one year ago. We already knew this, but since it came from sources other than the Bloc Quebecois, we were not going to let it slip by. Why does the Minister of Finance do nothing about tax havens, given the discrepancies I have just mentioned? The simple answer is that, since 1981 when he acquired Canada Steamship Lines, he has opened ten subsidiaries of that company in other countries. These ten subsidiaries are located in Bermuda, Liberia and Barbados, three so-called tax havens.

Prior to 1981, before the Minister of Finance took possession of Canada Steamship Lines, these subsidiaries did not exist. He organized his international shipping activities—because everyone knows he is involved in shipping, it is public knowledge—by opening subsidiaries in tax havens, with preferential tax rates, with great flexibility regarding environmental policies, for instance. In some of these countries, very little is respected. There was also quite a bit of give in the labour policies. These are not necessarily countries with stringent labour laws.

The Minister of Finance himself, who is involved in shipping, is at the helm, has subsidiaries of Canada Steamship Lines in so-called tax havens. Is he both judge and jury here? One might well wonder. The public also has a right to wonder why hundreds of millions of dollars are allowed to float away to so-called tax havens, why this is allowed to hang fire—for that is what is happening—, why tax conventions are maintained with countries with tax rates ridiculously close to zero. We are the ones who foot the bill for taxes not paid by Canadian subsidiaries in other countries. We are probably footing the bill for Canada Steamship Lines as well.

This is unfair. It is inequitable. There is something about it that bothers me and that greatly bothers the public. On December 10, 1997, a bill was introduced: Bill C-28. I can tell you that we will not drop this matter. We asked that special committee be struck to look into Bill C-28.

Perhaps I should remind those who have forgotten what Bill C-28 was about that its provisions supplemented somewhat tax treaties between Canada and countries considered as tax havens.

Bill C-28 is a big, massive bill. When it was introduced at first reading on December 10, it went almost unnoticed. At second reading, however, when it was first debated in the House, on February 2, 1998, the Bloc Quebecois went over this bill several hundred pages long with a fine-tooth comb. We dissected the bill and, toward the end, we found this rather short passage—three little paragraphs, 12 lines altogether over more than 400 pages of legislation—which proposed a tax change with respect to taxes paid by steamship holding companies. The Minister of Finance owns such a company.

What was the purpose of this change? It provided for holdings involved in international shipping operations in countries like Liberia, Bermuda and the Bahamas, where the finance minister's ships and companies operate, to be exempt from paying taxes to Revenue Canada. And no action would be taken against any of the international shipping companies involved. There are only five such companies in Canada, and the Minister of Finance owns one of them. Revenue Canada cannot retroactively prosecute these companies for unpaid taxes.

When we pointed that out at second reading, we were told we were wrong, that it was not the case, that it was not true. The Minister of Finance tore up his shirt. For example, when he left the House, he had a hard time providing an explanation for five minutes. He was stuttering, which is unusual for him. You have seen him during oral question period. He is so confident, he is so sure of himself that he gives us the short shrift. Even though every economic indicator points to a downturn in the economy, even though all the experts are talking about a major slowdown, and even though an increasing number of them talk about a recession in a year from now, as far as the minister is concerned, there is no problem. Things are just fine.

In the last two days, he has been using old quotes from the experts, and from the Quebec premier, Mr. Bouchard, during oral question period. These quotes are old ones dating back to the Saskatoon meeting, a month ago. The minister uses old quotes from experts that date back to last month, when the Bloc Quebecois raised the alarm by saying “be careful about the dollar free falling . The Prime Minister and the Minister of Finance are wrong to take this lightly, to play golf and to continue to say there is no problem, that there is no adverse effect on the economy”.

There is a risk of a slowdown in the economy. The number of jobs could decrease. We pointed that out in early August, and they made fun of us. Now, all the indicators point to a downward trend. For the past three months the economy has been slowing down, the growth rate and the GDP have been decreasing, and the Minister of Finance is still quoting what the experts said when we raised the alarm.

The situation has changed since then. The experts now agree with the Bloc Quebecois. They have asked the minister to use the surpluses generated at everyone's expense to, first, reduce taxes, second, increase social transfers and, third, lower employment insurance contributions, so as to give businesses and workers a break. But no, everything is just fine, said the minister with assurance, no problem.

On February 2, when this apparent conflict of interest was brought out—one that still exists—the Minister of Finance left the House, and his assurance left him as well. He did not have much in the way of explanations to offer, since he was the sponsor of a bill which offered tax advantages and protection against any recourse by Revenue Canada for payment of income and other taxes by his shipping subsidiaries located in countries considered to be tax havens. He was stuttering.

He referred us to Len Farber—and I recall it as if it were yesterday—his main man for tax policy, but also what I would call his main man for shady dealings. That same Len Farber who told us there was no problem with the family trusts condemned by the Bloc Quebecois as well as by the auditor general two and a half years ago.

Members will recall the two family trusts that moved from Canada to the United States. Two family trusts with total capital evaluated at $2 billion, transferred over to the U.S. without a cent of tax deducted. That same Len Farber, the great tax expert and organizer of shady dealings for the Minister of Finance, told us there was no problem, that everything had been done in accordance with the taxation rules, even if the decision at midnight to let these two trusts go without any problem had been made on December 23, 1990. At the end of the debate, Mr. Farber was taken down a peg because the Minister of Finance had been obliged to table a bill to block the loopholes that had allowed this near-illegal transfer of two two-billion dollar trusts to the United States.

That same Len Farber is given us as a reference by the Minister of Finance for an explanation of why there is no problem with Bill C-28. I met with him personally, along with one other person, in my office on the fifth floor, and it was explained to us that there might be a problem one day.

A minister introduces a bill which has an impact on a business in an area in which he works on the international level. Then a person referred by him tells us there could be a problem, a potential conflict of interest, that we need to be careful. We therefore began to wonder, and the fact is that the appearance of conflict of interest remains.

The minister then referred us to his ethics counsellor, who testified before the Standing Committee on Finance. Not only did he say there might be an appearance of conflict of interest, but he put it in writing. It was repeated time after time that a public inquiry was necessary for the sake of the Minister of Finance, that all appearance of conflict of interest needed to be taken away, because it made no sense to maintain the situation as it was. The minister always maintained that there was no problem, despite all the arguments to the contrary that were put forward.

Not often have we seen all four opposition parties present a united front. However, on this issue, members of the Bloc Quebecois, the Reform Party, the New Democratic Party and the Progressive Conservative Party held a joint press conference to demand an inquiry because of the appearance of a conflict of interest.

Not only was their request turned down, but when motions were tabled at the Standing Committee on Finance to call witnesses to shed light on the impact of Bill C-28 on the Minister of Finance's shipping companies, all Liberal members on the committee voted against these motions.

The minister and the government keep arguing that there is no conflict of interest or even the appearance of a conflict of interest. Yet, the Minister of Finance, who is sponsoring a bill dealing with international shipping, is the sole owner of an international shipping company that operates in tax havens.

How can you expect changes to the tax system? How can you expect the people opposite to be willing to review those tax conventions signed with countries whose tax rates are much lower than ours, and where tax evasion is possible?

I think we know the answer to that question. There is no willingness on the part of the government. The people opposite may be acting as judge and jury. We will not know for sure—and there is still some doubt in my mind—until we shed some light on Bill C-28, its impact and the appearance of a conflict of interest involving the Minister of Finance.

Is it any wonder the minister is unwilling to review the tax system? For five years now, we have been asking him to review the whole tax system in order to make it fairer. But he knew that the tax rates of shipping companies and our relationship with tax havens would fall under the scope of such an extensive reform, which is why he did not seem too eager to carry it out.

When we realized what was happening, we, in the Bloc Quebecois, decided to release starting in November 1996 two series of studies, some 350 pages, including very serious analyses and recommendations. In our studies, we suggested several changes to the personal income tax system to make it fairer and to give a tax break to middle-income Canadians who, need I remind you, have paid most of the $20 billion in new taxes the Minister of Finance has imposed since he was appointed in 1994. A large part of this $20 billion was paid by middle-income Canadians. Businesses in Quebec and Canada absorbed the other $17 billion in tax increases.

We presented a document on personal taxes which included critical analyses as well as recommendations. When we presented this document, the Minister of Finance praised us in the House. He said: “I praise the opposition for the serious work it has done on personal taxes and for its approach to this issue. I recognize there are problems and I recognize this document contains some good solutions”. He then took the document and put it at the bottom of his desk. When his desk was cleaned at the end of the summer, the document was put away in the circular file. We got no tax reform proposal from him.

Then we presented another document on corporate tax expenditures in Canada. It was an analysis of the main tax loopholes used by large businesses in Canada. Our analysis showed that some of these were outdated but cost billions of dollars a year to the Canadian treasury, and they still do, with the people of Quebec and Canada having to pay the difference in personal income tax.

We proposed abolishing certain tax expenditures and transferring these savings to small businesses to encourage job creation: for example, reduced payroll taxes and tax breaks for businesses that create jobs year after year.

The Minister of Finance said: “Another serious exercise”. Right. We can do without his praise. What we want is tax reform, and we never got it.

The Minister of Finance was so embarrassed about not doing anything that he decided to establish the Mintz group, a working group presided by Mr. Mintz, a highly competent tax expert. This group produced a large document. It took them a year as the deadline kept being postponed.

Some recommendations are worthwhile. Others are absolutely worthless. But to ease his conscience, the Minister of Finance asked the Mintz group to produce an analysis of tax reform. The group submitted its report last year. The Minister of Finance probably put that report on a shelf or in his desk. It did the same with it as it did with our two analytical studies on personal and corporate taxes.

There is no political will on the other side of the House to reform our tax system for the reasons I stated earlier. I see what the minister has done over the last five years. If there is anyone who follows him closely, it is me.

I see that the minister was coasting. Business was good, so he surfed, he rode the crest of economic growth. Money was coming in—corporations and individuals have paid $37 billion in taxes into the federal coffers over the past four and a half years—and he collected it. He also took in surplus after surplus in the employment insurance fund, to the tune of $6 billion a year, during three and a half years.

He is still collecting and wants it to be legal. He will ask his fellow ministers to be his accomplices in robbing the EI fund. He has cut assistance to the poor and the sick. He has cut billions from transfer payments to the provinces; by 2003, he will have cut $42 billion from transfers for social assistance, higher education and health.

He pocketed the money. Everyone—the sick, the disadvantages, seniors, students—tightened their belts while he collected. A real money machine. Favourable economic conditions, combined with cuts imposed on the poorest of the poor and cuts to health transfers, that is what he calls sound management of our public finances.

He could have taken positive steps instead of achieving the exact same result through decline management. He could have reviewed the whole tax system five years ago, when we asked him to; it was in fact part of our platform. He could have plugged the loopholes in the tax system with respect to tax havens. He could have reviewed the reciprocal treaties, that is, the tax conventions with countries considered tax havens. He could have avoided voting in favour of bills promoting international shipping, where he has some involvement. He could have done a whole lot of positive things for employment, equity and tax fairness.

But no, the Minister of Finance took advantage of the economic situation. Money was coming in and everything was fine. He looked like a good manager, but he is one of the worst we have ever had. In the past, the economy was not so kind to finance ministers. We have had Ministers of Finance who were less draconian than this one. They would not have dared take money from the sick, the unemployed, those on welfare, students and the less fortunate. There was respect at that point, which the Minister of Finance no longer has for anyone.

Bill S-16 is a good bill, because the countries involved have comparable tax rates. But it has given us an opportunity—and we will seize it whenever we can—to criticize the inertia and the lies of this government along with the measures it has not taken but ought to have to improve the lives of people in Quebec and Canada. These measures could still be taken, because the surpluses generated could be used properly instead of to repay part of the debt in a context that is very uncertain at the moment.

I remind you that we do not oppose repayment of the debt. When things are more sure, we will be the first to advocate using a large part of the surplus to repay the debt. At the moment, however, we have had three consecutive months of economic slowdown. The Statistics Canada composite index tells us there was no growth in August, something we have not seen for two years. Businesses' orders are down and jobs are beginning to stagnate in the area of trade.

It seems to me that all this together with the fact that the Bank of Canada stupidly raised interest rates by one whole percentage point on August 27 sent considerable shock waves through the economy, which was already weakened after three consecutive months of reductions in the rate of GDP growth. We thus have all the ingredients for a major economic slowdown in the months to come. Let us not forget that such a downturn means fewer jobs created, a loss of wealth and less tax revenues for the government. In short, it means hardship.

The Minister of Finance now has surpluses he should use to stimulate economic growth. He should at least do that good deed, given that he has not done any in the past five years. Let us give him the honour and ask him to take our request for a special budget seriously. He should consider using the surpluses to stimulate domestic economic growth by reducing taxes for middle-income people—who have been paying a lot in the past four years—and by reducing EI premiums, so as to give a break to businesses and workers, who have contributed more than their fair share in the past few years.

The minister should listen to the unanimous plea made by the premiers. They are asking him to reinvest what he shamelessly took from federal transfers to the provinces, and to use that money to fund social assistance, higher education and health. That is all we are asking him to do.

Having said that, we will support Bill S-16.

[The Deputy Speaker]

Before recognizing the hon. member for Palliser, it is my duty pursuant to Standing Order 38 to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for New Brunswick Southwest—Hepatitis C.

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, it is a pleasure to be back in the House and to follow my learned colleague from the Bloc. I listened with great interest to his speech and his recommendations. I commend it to the finance minister and to government members opposite.

I also want to associate myself with most of the other speakers who have been up on the bill to talk about the relative unimportance of Bill S-16 in comparison with the important financial, fiscal and other needs we think we should be discussing in the House.

Probably like many other members of parliament I conducted some accountability sessions recently before returning to parliament to find out what was on the minds of the constituents in Palliser. We talked about a number of things.

We talked about the low dollar, the crisis in agriculture, how any surplus the federal government has will be apportioned, the lack of a national transportation system, the fact that Canada is virtually the only country in the OECD that does not have a national transportation system, the recent hike in interest rates, the lack of national funding for medicare, what to do with the EI surplus and the Tobin toll. I assure the House that nobody talked to me at all about tax treaties between Canada and the Socialist Republic of Vietnam, the Republic of Croatia and the Republic of Chile.

The bill is very thin gruel by comparison to what Canadians would like to be talking about here this afternoon. I know it is up to the government to propose legislation. I will give it the benefit of the doubt and suggest that this is perhaps a bit of housekeeping that needs to be tidied from last June. We in this caucus would certainly hope that the government moves forward in a speedy fashion to bring in more substantive pieces of legislation.

This caucus will be supporting Bill S-16. It is a tax treaty bill that we do support on its merit to avoid double taxation and to prevent fiscal evasion. The taxation rules of the treaties need to be passed by an act of parliament in order to give them precedence over domestic legislation, and the conventions follow OECD models on double taxation conventions.

The bill is quite similar to several tax treaties introduced in parliament in past years, for example Bill S-9 and Bill C-10. Fortunately Bill S-9 is that infamous piece of legislation passed in the 35th Parliament that was embraced, supported and promoted by both the government and the Reform Party that offers substantial tax breaks for Canadians who make donations to American charities and American universities.

While it is reciprocal it is not terribly because we have about 25,000 Canadian students in the United States compared to only a very few thousand Americans who come north for their post-secondary education. It is a huge tax break for the wealthy in this country. Added to it was the U.S. estate property taxes dating all the way back to 1987, paid for not by the Americans but by the Canadian government. This is just a reminder about the very significant shortcomings of Bill S-9. Bill S-16 was studied by the Senate foreign affairs committee and returned to the Senate without amendment.

As I said before, the tax treaties are between Canada and the Republic of Vietnam, the Republic of Croatia and the Republic of Chile. Currently we do not have tax treaties with these three countries.

The government's rationale for the legislation is that it is necessary because the provisions of the respective agreements are sometimes different from the provisions of the Income Tax Act and it is necessary to ensure that as much tax reporting as possible be allowed. These agreements will override the Income Tax Act.

In addition we note the tax treaties are necessary to avoid double taxation and to prevent fiscal evasion. They also provide tax certainties to individuals and companies carrying on businesses abroad, foreigners carrying on business in Canada, and individuals receiving income from Canada who are living abroad.

Pension payments between the respective countries are treated in the following way: Vietnam and Croatia apply withholding tax rates limited to 15%, while Chile allows all pension payments to be taxed only in the country where they are paid out.

Social security payments under the tax treaty provisions are taxable only in the country in which they originate and in accordance with domestic legislation.

In order to avoid double taxation each of the treaties also contains specific rules which in the case of Canada refers to an exemption for certain dividends received from foreign affiliates and for credit in other cases. One exception is the treaty with Vietnam which contains a rule referred to as the tax sparing provision, ensuring that the most developed countries will not tax away some incentives provided under the domestic legislation of less developed countries. This is apparently to be a short term provision.

These treaties provide for an exchange of tax information between the revenue authorities of countries to assist them in the fight against tax fraud and evasion. The problem, however, is that the treaties only say that information may be exchanged and do not say it must be exchanged or is required to be exchanged. For example, individuals and companies which may want to play around with the tax system run a risk of tax authorities obtaining tax information but no guarantee.

While supporting this initiative to create better checks and balances on taxation information matters between these countries, however, we should encourage the same government to look further to the concerns about large flows of investments that go unrecorded and the level of fiscal evasion that these unrecorded investments represent.

While I am on my feet it is important to make reference to the Tobin tax on foreign exchange transactions which can be used in this area. Indeed there are areas of the international economy that require active supervision and control. That is our strong contention. International trade and investment grow best during the careful process of long term planning and prediction. Uncertainty such as the current turbulence in today's financial markets and their effects on domestic interest rates and dollar values are too costly. The biggest challenge we have is to regulate the financial markets so that their speed is slowed and their powers reduced somewhat.

There has been a fair amount of talk about the Tobin tax or the Tobin toll. I will take a few minutes during this intervention to comment on it. The Tobin tax derives its name from James Tobin, a Nobel prize winning economist who first proposed the idea of a tax on foreign exchange transactions that would be applied uniformly by all major countries. I believe he was talking about a small amount, less than .5%, to be levied on all foreign currency exchange transactions to deter speculation on currency fluctuations.

While the rate would be low enough not to have a significant effect on longer term investment where yield is higher, it would cut into the yields of speculators moving massive amounts of currency around the globe as they seek to profit from minute differentials in currency fluctuation.

We might ask why the support is growing for such a tax. The interest has grown rapidly in such a mechanism as the place of foreign exchange transactions and financial deregulation has accelerated significantly over the past decade. We believe that today about $1.5 trillion U.S. is traded every day on unregulated markets and less than 5% of this activity is related to trade in goods and services. The remaining 95% is simply speculative activity as traders take advantage of exchange rate fluctuations and international interest rate differentials.

This kind of financial speculation plays havoc with national budgets, as we have seen this summer in our own country, economic planning and the allocation of resources.

Governments and citizens are becoming increasingly frustrated by the whimsical and often irrational activities in global financial markets that have such an influence over national economies and are seeking some means to curb damaging and unproductive speculative activities.

A uniform tax on foreign exchange transactions would deter speculation by imposing a small tax on such activities. This would reduce the volatility of exchange rate fluctuations and provide exporters, importers and long term investors a more stable exchange rate in return for paying the tax.

The tax would give more autonomy to governments to set national fiscal and monetary policies by making possible greater differences between short term interest rates in different currencies. Such a tax would also reinvigorate the capacity of central banks to alter exchange rate trends by intervening in currency markets. By cutting down on the overall volume of foreign exchange transactions, central banks would not need as much financial clout in order to intervene in the market.

This tax would raise revenue. By all estimates there would be significant sums and receipts. Assumptions vary about the actual rate of the tax, the decline in volume of trade, the amount of trade circumventing the tax and which transactions would be exempt; however, for illustration, assuming a conservative tax rate of 0.2% and an effective tax base of $75 trillion U.S. annually, the tax would yield about $150 billion annually in receipts. Given the declining commitments to bilateral development assistance around the world, the tax should generate important resources to support sustainable human development.

There are two key political issues involved with putting such a tax into place. First, it would be necessary to forge agreement amongst the major countries to implement a uniform tax. Second, there would have to be agreement on the collection and distribution of the tax revenue.

Developing countries have always been much more vulnerable to exchange rate volatility, but there is for the first time a convergence of interest between industrialized and developing countries as they all seek stronger government autonomy and more effective central bank intervention.

Pressure is building on national governments, including this one, and international institutions to support a Tobin tax from coalitions of non-governmental organizations representing labour, church, environment, women, youth, seniors and poverty groups as they seek to restore some measure of democratic control of their national economies.

Perhaps more significant is the fact that many governments face large deficits and strong anti-tax populism among the electorate and are looking for new sources of tax revenue that are not politically suicidal. Such a minimal tax will not hit main street in this case, but rather Bay and Wall Streets.

The promise of a new source of revenue will likely be the primary motivation for reaching agreement to implement the tax.

Collection and distribution of the tax revenue is a much trickier question. The tax rate would have to be applied worldwide at the same rate in all markets. There would also have to be agreement on precisely which transactions would be subjected to the tax. Compliance would depend on the banking and market institutions. Tracking the activity would certainly be possible as the financial industry has the sophisticated technology required to do this, but enforcement would rest with the major economic powers and the international financial institutions.

There would certainly be some strong resistance from members of the financial sectors, some of whom have already begun to speak out against this proposal. That is not surprising. It is possible that some members of the financial community might support the tax; however, the pace and volumes traded in the markets has added a level of risk to doing business, for as much as great profits can result from speculation, so can great losses such as the Barings Bank fiasco of a couple of years ago.

Some experienced business people may see the value of the limited risk of more stable markets suggesting, if not the Tobin proposal, other strategies to limit the volatility of the current global money system.

What we are supporting and recommending is a tax to curb speculation in foreign currency exchange as an innovative and fair proposal that will contribute to restoring democratic control over our national economies and generate substantial revenues to build a sustainable future.

Governments around the world, the UN, the International Monetary Fund and the World Bank should take the steps necessary to implement a tax to curb currency speculation as quickly as possible.

Finally, the tax should be administered by an accountable democratic structure, such as could be found within the United Nations, with the revenue collected used for genuine social development.

With that I will take my seat and, in so doing, indicate that our caucus is in full support of Bill S-16.

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

Mr. Speaker, it is with pleasure that I rise today to speak to Bill S-16, passed by the Senate on June 2, 1998.

The purpose of Bill S-16 is to implement an agreement between Canada and the Socialist Republic of Vietnam, an agreement between Canada and Croatia, and a convention between Canada and the Republic of Chile for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

As my Bloc Quebecois colleague mentioned, our party will not oppose the tax conventions signed between Canada and the three countries I have just named, in so far as the purpose of these agreements is to ensure fair and equitable tax treatment of persons, and to encourage trade and investments between the countries. I would point out that the term “person” includes private individuals, corporations, trusts and any other group of individuals.

Since the countries concerned in this bill have a rate of taxation that is almost the same as Canada's, I will not speak against the bill. But, while we are on the topic, I would like to use the time I have to speak about tax conventions in force between Canada and certain countries.

Although tax conventions avoid double taxation, they are in many cases a source of problems and tax evasion. Care must therefor be taken that these treaties do not open the door to tax evasion. To that end, tax conventions must be limited to countries with a tax rate comparable to Canada's.

If the tax conventions avoid double taxation on people's incomes, in certain cases they are a source of problems and encourage serious tax evasion. Although the most recent treaties, which are based the OECD model, are relatively standard, Canada does have some older ones with countries considered tax havens because their individual and corporate tax rates are low, or non-existent.

In this connection, let us keep in mind that the Auditor General of Canada has raised this matter on more than one occasion. I would like to quote to you what he wrote in his 1992 report.

A Netherlands Antilles subsidiary of a Canadian company had assets of $865 million and income of $92 million not subject to the FAPI rules.

Although the income of the foreign subsidiary has not been taxed at a rate that approximates Canadian rates, it can be transferred to the Canadian parent as tax-free dividends.

The auditor continues:

The offshore income is not taxed on entering Canada, but it carries with it federal and provincial tax credits on dividends paid out to Canadian shareholders.

And he concluded:

The Canadian parent incurred the financing costs for its investment in the subsidiary and reported a tax loss in Canada of $29 million.

This is shameful. I could talk about many other similar instances, in the case of the government, but it would fall on deaf ears.

There is another danger in certain tax treaties, namely that of being able to change tax rules in favour of friends of the government or in favour of people in the government. I am referring here to Bill C-28. Members will recall that the Minister of Finance is both judge and jury in this bill and that, should this bill become law, it will bring millions of dollars to his company, Canada Steamship Lines.

That outrageous stunt was discovered by my colleague from Saint-Hyacinthe—Bagot. Members will also recall that all opposition parties supported the Bloc in this matter.

The Minister of Finance should protect the interests of Canadian taxpayers the same way he protects his own interests.

Tax treaties and the manipulation of legislation cost billions of dollars to taxpayers. These are billions of dollars in tax revenues that are lost to the detriment of Canadians.

Any serious and responsible government, however, would spend a lot of resources to assess, adjust and renegotiate the tax treaties that cause problems, especially those most likely to cost Canada a lot of tax money.

But guess how many public servants in the finance department are working on these tax treaties: 100, 25, 12? No, in fact, the finance department has only one employee working on tax treaties, but fortunately, he works full time.

We do not question the competence and seriousness of this public servant. Our only regret is that, in Canada, we only have one public servant to oversee some 60 tax treaties and work on 30 more to come, when there are hundreds of millions, if not billions of dollars, at stake.

What we have here is a government turning a blind eye to the potential exodus of hundreds of millions of dollars in unpaid taxes.

This is a very serious issue because it undermines the overall integrity of our tax system. With all these holes in our system, Canada's reputation is also tarnished. It is very troublesome.

Given the billions of dollars the Minister of Finance has cut in transfers to the provinces for hospitals, schools and social assistance, the honest citizens of our country, who pay their taxes to Ottawa, want their government to at least ensure that everyone pays his fair share.

One good thing is that, in some cases, tax conventions apply to our performers and all Canadian and Quebec artists who perform abroad, even our athletes, like our hockey players and all the others who are earning a living abroad.

On the other hand, we know that tax agreements are nothing new. They have always existed and will always exist, and will even increase in numbers with globalization.

Tax agreements establish what we call reciprocal taxation, insofar as Canada's corporate tax rates and those of the countries with which Canada signed these agreements are equivalent or comparable.

In closing, I repeat that the Bloc Quebecois is in favour of tax agreements signed between Canada and other countries when these treaties are aimed at ensuring fair and equitable taxation of residents and non-residents, thus encouraging trade and investments between countries.

But make no mistake: these treaties should not open the door to excessive tax evasion.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, this bill lets Canada ratify income tax treaties with Vietnam, Croatia and Chile. It is all part of a very important process that is consistent with our position as a nation in embracing the global opportunities that we have. It also addresses the challenges we have dealing with a world whereby globalization and the forces of international trade are making national borders less and less relevant in terms of economic matters.

In many ways, it is extraordinarily important that we move quickly to ratify these types of tax conventions to ensure that we are not allowing companies, particularly in a global context, to escape paying fair taxes and by the same token that we are not duplicating taxes. In light of the declining role of the nation-state in terms of its ability in many ways to effect taxes, this type of treaty is very important.

As a background on the whole issue of trade, many of the people in the House today will remember that in 1988 our party, the Progressive Conservative Party and the government of Brian Mulroney spearheaded the free trade efforts in Canada and fought a general election openly with the Canadian public. We engaged in a dialogue with the Canadian public in the most open sense. That battle was won by the Progressive Conservatives. Canada has won since then by engaging in open trading relationships with countries around the world.

We cannot as a fairly small country in terms of our population which numbers fewer than 30 million people, prosper and grow our economy and employ more Canadians unless we are willing to embrace the opportunities of free and unfettered trade. It is that path I am proud to say our party put Canada on. As such, we are supportive of Bill S-16.

I would also like to reference the fact that this bill was introduced in the other place. I know there has been significant discussion on that issue in that the other place is introducing legislation like Bill S-16.

I would like to commend the other place and recognize the tremendous pool of talent that we have in the other place, particularly on the extremely technical tax treaty type of legislation. Frankly, it would be an affront to the Canadian taxpayer if we were not to utilize the other place by engaging them in the very important work they are capable of. In the Senate we have a significant pool of talent and abilities that it would be absolutely wrong for us not to utilize.

As a trading nation, our exports last year totalled some $344 billion and our imports totalled some $329 billion. The majority of our trade is with the United States. Naturally, it is very important that we continue our focus on improving our trading relationships with our largest partner, the U.S. That being the case, it is extraordinarily important that we continue to work and build relationships with other countries, Vietnam, Croatia and Chile.

It is interesting that we now have more trade barriers within Canada due to interprovincial trade barriers between Newfoundland and Nova Scotia than we do between Nova Scotia and Chile. This points out the fundamental flaw of the whole policy of interprovincial trade barriers which again serve to deny Canadians an opportunity to build a comparative advantage right here at home, but that is another issue.

The issue of trade has been a significant one as of late particularly in light of the global currency markets and the tumult that the currency markets have seen recently. It has been very convenient for the government to blame commodity prices and the “Asian crisis” for the weakness of the Canadian dollar but it is far greater than that.

We have to recognize that there has been a secular decline in the Canadian dollar for the past 30 years and that structural issues need to be addressed within Canada. These include productivity related issues like the interprovincial trade barriers, like the fact that we have the highest rate of income taxes of the G-7 countries, like the fact that we have a regulatory burden that exceeds that of many of our largest trading partners.

Those types of issues will become more and more relevant in the future. As we sign tax conventions in the future it will be important to recognize not only that we should sign tax conventions but that our rates of taxes within Canada not exceed the rates of taxation of our partners. We are handcuffing Canadian producers and Canadian companies and individuals. We are preventing them from producing and performing to their utmost ability in competing globally, and that is not right.

In 1988 the Progressive Conservative government opened up the world to Canadians when it opened up global opportunities to Canadians. That courageous policy leap was followed by structural changes in the Canadian economy which included the elimination of the manufacturers sales tax and the deregulation of financial services and transportation industries. Those were the types of structural changes we needed then and which have proven to be successful now. I call upon the government to continue to make these structural changes, to hearken back to some of the courageous policy initiatives of the previous government and to continue on the path Canadians need to follow.

It is not enough that we open up global opportunities to Canadians. We need to ensure that our domestic economic policies provide the type of economy that produces the entrepreneurial expertise and excellence that are necessary not only to compete but to succeed in a global environment. We need to ensure domestically in terms of tax issues that both our corporate taxes and our personal taxes become fairer and flatter.

The Mintz report on business taxation which was introduced some months ago was an extraordinarily well written document. It dealt with the complex issue of corporate taxation in a holistic and rational way. I hope the government will give a significant amount of attention to the Mintz report and will move to simplify and reduce both corporate and personal income taxes within Canada.

Canadians cannot compete and succeed if we handcuff them to the past, if we handcuff them to high rates of taxation, regulatory burden, interprovincial trade barriers and an interventionist economy that is simply not realistic or sustainable in a modern global context. We need to continue to ensure that Canadians pay their taxes and that foreign companies doing business in Canada pay their taxes. We have to ensure those taxes are fair and not so convoluted and complex that Canadians and Canadian companies have to hire accountants simply to deal with their own government.

We will continue to push for increased access to global markets from this party. I recognize members of the Liberal government have become born again free traders. Many of the members opposite fought vociferously against free trade agreements in 1988. However I do commend them for having learned so much from us at that juncture and in having come so far in embracing sound economic policies.

I would ask them again at this juncture to do what they have done very well over the past several years which is to take policies from Conservatives and move forward into the 21st century with the type of economically realistic and economically necessary policies that some believe only the Conservative Party can introduce.

That is why it is important periodically that a Conservative government be elected, such that those types of policies be introduced, even if they are adopted by the government after. The only thing worse than their having taken our policies so blatantly and shamelessly would have been for them not to have taken our policies because they would have substituted some of their own which would have been far worse. In fact, the Liberal government opposite has been a government of sound and original ideas but unfortunately its original ideas are seldom sound and its sound ideas are never original.

It is encouraging to see that the government has come so far, even in terms of the deficit reduction issue. That was an issue we addressed very clearly by reducing the deficit as a percentage of GDP by half during the period of time that our government was in power and by reducing program spending growth from 15% to zero.

That was the kind of courage the previous Conservative government demonstrated before fiscal responsibility became cool. Back in 1979 Joe Clark introduced a budget that was defeated because it was too fiscally responsible for the time. Today even the New Democrats talk fiscal responsibility. It has become a buzzword.

In any case, we have no problem with Bill S-16 and will be supporting it today. We just hope that in the future we will continue to see not only income tax convention legislation but also the types of structural changes made in the Canadian domestic economy that allow Canadians to compete successfully abroad and to not just compete but to succeed and to prosper in the 21st century.

[Bob Kilger, Liberal, Stormont—Dundas, ON]

Mr. Speaker, I rise on a point of order.

There have been some discussions among all the parties and with everyone's co-operation, the member for Esquimalt—Juan de Fuca would be the last speaker on this bill and in fact would conclude his remarks no later than 5.35 p.m. If that is reasonable to all members here, then we would proceed with the debate and we would ask that the question be put at that time.

[The Deputy Speaker]

As a clarification, I assume that the question will be put on the motion and it is understood that there would be no questions or comments at the conclusion of the remarks by the hon. member for Esquimalt—Juan de Fuca.

Is it agreed that we proceed as outlined by the chief government whip?

[Some hon. members]

Agreed.

[Keith Martin, Reform, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, it is a pleasure today to speak on Bill S-16 which deals with double taxation with the countries of Vietnam, Croatia and Chile. This is very important.

Double taxation has often been seen as a real hamstring to our private sector. The removal of double taxation also enables developing countries in particular to develop a stronger economy in the future. It also enables companies in other countries to work effectively.

The end effect of the removal of double taxation actually lowers the taxation levels for the private sector so the private sector can engage effectively in these countries. We should strive to ensure that taxation occurs only in one country rather than two.

In the case of South Africa, the removal of double taxation which took place a few years ago was very effective and helped to stimulate investment in that country in a very effective way. It all boils down to a way of improving development in developing countries. It also helps the neediest people in those countries.

The government needs to address the aspect of taxation within our country. As we know, the taxation levels here are probably the greatest barrier to the ability of our private sector to be competitive. In comparing our situation to that of the United States, couples with two incomes are actually earning 44% more take-home pay than an equivalent couple in Canada.

Businesses are labouring under a tax level that is at least 13% greater in Canada. It hamstrings the ability of our private sector to be competitive with countries down south and, as a result, has contributed to brain drain and the inability of our private sector to be as aggressive as it could be.

I would ask the government to look at the egregious rules and regulations that hamstring our private sector. We continue to put rule after rule after regulation on the books without taking a step back and looking at whether the rules and regulations are necessary. It would be wonderful if the finance committee created a subcommittee and utilized the private sector and its experience to look at the rules and regulations that exist on the books and remove the ones that are ineffective. By doing this we would greatly improve the nimbleness and efficiency of the private sector and, by doing so, enable the private sector to hire more individuals and be increasingly competitive in the global economy.

We need to look more carefully at research and development. Research and development is a cornerstone and a pillar of our economy. Right now we are at the bottom of the barrel of all OECD nations.

Education needs to be spruced up. We need to look at how education can better reflect the needs of our economy in the future. I would ask the government to work with its provincial counterparts in developing a think tank to ensure that our post-secondary institutions and students can better understand the needs of the future and thereby get skills.

There is also room for looking at the European experience in non-post-secondary university type settings where people can get the technical skills that are going to be required in the future. This does not require a university education. The technical skills are desperately needed in our country today and will be needed in the future. The government can certainly take a leadership role along with its provincial counterparts in creating institutions which will teach technical skills to our youth.

This bill comes from the Senate. Our party has spoken at length about the Senate and the desire of many members of the House, as well as many others, to have a democratic Senate. Senators have recently been appointed by the Prime Minister. If the hallmark of democracy is the ability of the people to vote for their representatives in this House, the Senate fails.

There are many good people in the Senate, but there are some who are not pulling their weight. It would benefit all members of the Senate, the good ones in particular, if we were to have an elected Senate. If we had an elected Senate people from all across the country, the best and the brightest, could become candidates. The Canadian people could then decide. We would have a much more vigorous Senate. It would truly be a House of sober second thought which could more effectively work with members of parliament to provide the best legislation to Canadians.

In closing, I would like to move an amendment, seconded by the hon. member for Surrey North, which reads:

That the motion be amended by deleting all the words after the word “That” and substituting the following therefor:

“this House declines to give second reading to Bill S-16, an act to implement an agreement between Canada and the Socialist Republic of Vietnam, an agreement between Canada and the Republic of Croatia and a convention between Canada and the Republic of Chile, for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, since the principle of the bill which was proposed by the unelected Senate fails to address the matter of the Prime Minister's refusal to respect the democratic rights of Albertans when he appointed a former Tory MP to the Senate.”

[The Deputy Speaker]

I can give the hon. member for Esquimalt—Juan de Fuca and his colleagues high marks for persistence, but I am afraid this motion falls under the rulings that I have given twice previously today in respect of its admissibility. I refer the hon. member, in case he missed the earlier reference, to citation 568 of Beauchesne's, which states:

It is an imperative rule that every amendment must be relevant to the question on which the amendment is proposed.

I am afraid that the amendment moved by the hon. member does not deal with the substance of this bill. It is not relevant to taxation matters. It appears to be relevant to the origins of the bill which, in the opinion of the Chair, are irrelevant in accordance with the dicta contained in Beauchesne's citation. Accordingly, I rule the amendment out of order.

Is the House ready for the question?

[Some hon. members]

Question.

[The Deputy Speaker]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

(Motion agreed to, bill read the second time and referred to a committee)

The House resumed from May 1 consideration of the motion that Bill C-251, an act to amend the Criminal Code and the Corrections and Conditional Release Act (cumulative sentences), be read the second time and referred to a committee.

Criminal Code

[The Deputy Speaker]

Before I call for the resuming of debate and in view of the widespread interest that members have expressed in wishing to speak on this bill, perhaps the Chair could assist the House by indicating the order in which the Chair intends to call hon. members in the debate today. This in no way prejudices those who might come later. If there are problems with this list and members wish to speak to the Chair about changing it, I will certainly entertain discussion on it.

I propose to call the hon. member for Whitby—Ajax, the hon. member for Berthier—Montcalm, the hon. member for Lambton—Kent—Middlesex, the hon. member for Surrey North, the hon. member for Pickering—Ajax—Uxbridge, the hon. member for West Nova, and the Parliamentary Secretary to the Solicitor General, in that order.

[Judi Longfield, Liberal, Whitby—Ajax, ON]

Mr. Speaker, I am very pleased to offer my strong support to my colleague, the hon. member for Mississauga East.

This is the third time my colleague has brought the present system of concurrent sentencing forward to the House dealing with serial predators and their sentencing. She should be congratulated for her perseverance and dedication to this issue. It is time for us to deal with this issue now and to delay no longer.

My colleague was successful because of the efforts of 166 members of this parliament, from all parties, who signed this bill and made it a votable item. They should be congratulated for taking such a very strong stand.

Bill C-251, entitled “An act to amend the Criminal Code and the Corrections and Conditional Release Act (cumulative sentences)”, provides for the imposition of consecutive sentences where a person commits multiple serial offences.

This bill is about making our streets safer for all Canadians. This bill is about punishing serious offenders in such a way that their sentence accurately reflects the gravity of their offence.

This bill is about restoring public confidence in our criminal justice system. There is a very popular saying that goes something like this “In order for justice to be done, it must be seen to be done”. When a serial murderer or rapist is sentenced as though only one crime was committed, justice has not been seen to have been done and therefore it has not been done.

When a system that is designed to protect the public falls into such disrepute and loses the respect and confidence of the public, action must be taken. This bill is about showing the proper respect to victims and showing the proper respect to their families, whose suffering is so often underestimated.

I believe that the primary function of our criminal justice system is the prevention of crime and the protection of society. Unfortunately the system cannot protect everyone all the time. People do get hurt. They are wronged. They are victimized. But once an offender is apprehended and convicted, sentencing is required.

There are different views with respect to the purpose of a criminal sentence. The prevailing opinion among justice and correctional officials is, in my view, appropriately focused on rehabilitating the offender and ensuring that he or she does not commit another offence upon their release from prison. We cannot lock up everyone and throw away the key. However, I believe the focus is so single-minded that it neglects other critical aspects. Very seldom do we hear the word punish.

In the case of repeat murderers and rapists I would think most Canadians are not interested in rehabilitation. They do not want to see these people on the streets again. I agree with them.

Canadians must be permitted to express their outrage at and condemnation of such brutal acts of violence. Our current system of sentencing repeat offenders does not serve this need.

Concurrent sentencing provides one sentence for multiple crimes. What is left to deter criminals from committing further atrocities once they have committed their first?

To put the current situation bluntly, we offer volume discounts for rapists and murderers in Canada. The current sentencing regime cheapens life. Virtually no regard is given to the lives of the individual victims.

Much of what I am saying has been said before in this House, but it needs repeating. The pain and suffering and the death of a second, third or eleventh victim is of no consequence to the court. The minimum penalty always applies, even for the most prolific killers.

The majority of murderers and serial sex offenders are returned to neighbourhoods, often without publicity or warning. Trials and convictions attract public attention and the public is usually lulled into the hoax that a life sentence means life. They have read it in the morning paper.

But a life sentence is not a life sentence. Ten years later they actually hear the truth. The parole board has short-changed justice, written off the victims as if yesterday's news, just to free up a bunk for the next serial killer.

But Canadians are gradually catching on to this deception of life imprisonment. Half of those convicted of second degree murder are sentenced to life and are released in less than 12 years. For first degree murder the median has historically been 14 years. Life only means life for the murder victim who is not there to protest his or her sentence and is never eligible for parole.

My own family knows too well about the loss of a loved one, knowing that the perpetrator of the crime, the fellow who took the life of a young officer in the prime of his life, who left a wife and three children, is eligible for parole within the next year. Kitty and her children will never have Vernon back. Life was life for Vernon.

The predator has dealt a life sentence to the victim's family. For them the comforting illusion of safety in our streets has been shattered. They have to live with the stark truth that the only law that protects them is the law of averages, the chance that none of the predators roaming our communities will get around to them again.

The sad truth is that judges already have the power to sentence consecutively but they simply are not doing it. I say this is very sad because although judges are charged with applying the law in a fair and impartial manner they should also reflect community interests and values in doing so. Judges claim to be doing this when dealing with issues of public nudity and obscenity. Why when it comes to sentencing serial rapists and murderers do they not apply the same?

It is up to parliamentarians and lawmakers to send a message that the courts are not. It is that predators will be punished and punished severely. There are no mitigating circumstances for a predator. There is no need to rehabilitate a predator. No predator is a safe addition to any neighbourhood, no matter what therapists say. Predators belong in prison permanently.

Some will argue that consecutive sentencing serves no purpose other than revenge. If a predator knows that he is going to jail for the rest of his life, that he will never have a chance at parole, that he will die in prison, he may think twice. If the prospect of consecutive sentence does not act as a deterrent in a specific case, it will serve to express more genuinely the revulsion, horror and outrage of the Canadian people. It will also serve to show the family and friends of the victim that their government cares about them.

These two reasons together or individually are sufficient to justify consecutive sentencing. Our institutions are very responsive to lawyers, lobbyists, inmates and advocates. Criminals can rely on the system that orphaned the victims. The murder victim has no representative, has no lobbyist, has no lawyer because the victim is dead. The only argument we will hear about the victim's lost rights will come from the family and from people who recognize the injustice and the obscenity of the current system.

Why are we offering a Wal-Mart two for one sale for criminals committing serial crimes? Commit one, get another one free, a third one, a fourth one. This has to stop. Each life is valuable. Sentencing must reflect the value of each individual life. Currently the second victim means nothing. Very simply, we are offering a bulk rate deal to murderers and rapists. One 25 year so-called life sentence is a penalty for premeditated murder no matter how many victims. A mere seven years in prison is the maximum parole ineligibility for a rapist no matter how many victims.

I am proud to support Bill C-251 and I urge other members of the Liberal caucus and members from the other side to support it.

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, I am pleased to speak to the bill brought forward by the member for Mississauga East.

To start with, I too would like to congratulate her on her bill since it opens up a part of the Criminal Code. It is important to review it, check a few things and eventually perhaps go along with the member.

I want to say right away that I am in favor of the bill and its being scrutinized by the committee to see—I will go into it in more detail later—whether the bill is in keeping with the Criminal Code, the case law, the Canadian way and especially the Quebec way.

I will remind listeners that the bill provides for the imposition of consecutive sentences where a person commits sexual assault and another offence arising out of the same events or where a person is already serving another sentence at the time.

Moreover, the bill amends the Corrections and Conditional Release Act. This amendment provides that a person sentenced to life imprisonment for first degree or second degree murder is not eligible for parole until the person has served, in addition to the portion of sentence that the person must serve for murder, one third or a maximum of seven years of any other sentence imposed on the person in respect of an offence arising out of the same events. The mandatory portion of each life sentence imposed on a person who is convicted of a second murder must be served consecutively before the person is eligible for parole.

This is all very technical, but those who are somewhat familiar with the Criminal Code will have understood what I said. I will try to shed some light on this during my allotted time.

The seriousness of the offence is one element I take into account when I look at a bill, especially a private member's bill. I try to see what exactly is the intent. This bill deals with the most heinous crimes. Therefore every member of the House should pay close attention to it.

If murder has as a consequence the taking of a life, sexual assault defiles the victim forever. One must look at this offence with a very careful eye and try to see the parallel that exists between various criminal offences.

Sentences given for those crimes must reflect the seriousness of the offence, in light of the circumstances. Imposing a fair and adequate sentence is difficult in that we have to make sure it takes into account the characteristics of the offender, protects the interests of the community, which largely depend on the values it cherishes in a given period, and meets the victim's need for protection and reparation.

The sentencing judge must make sure the sentence is proportionate to the seriousness of the crime and the degree of responsibility of the offender. Bill C-251 raises a fundamental question: Does Canadian criminal law deal adequately with murders and sexual offences, given the seriousness of these crimes? This is an extremely important question, and it deserves an answer.

Incidentally, I would like to tell the House that I am currently working on a bill similar to the one introduced by the hon. member, because I am also of the opinion that sexual offences are very serious. I hope she will return the favour and support my own bill. My goal is to allow judges to take the psychological damage inflicted on victims into consideration in sentencing.

Having said that, I think we could indeed improve the situation now prevailing as far as sentencing for sexual offences goes, because these offences are very serious.

But the Criminal Code already allows judges to impose sentences to be served consecutively. This is in section 718.3(4) of the Criminal Code. This provision deals with sentences for offences in general and not sexual offences specifically. That is probably why the hon. member felt she had to introduce Bill C-251.

She is probably right, and we should add this special provision relating to sexual offences so that judges not only may but are in fact required to impose sentences to be served consecutively. When I say we should see whether that provision is compatible with the Criminal Code or with Canada's case law and way of doing things, I mean that we should see whether this bill deprives judges of a degree of discretion they now have.

At first glance, I honestly and sincerely think “sexual assault” should be added, to send a signal to the public to show that we are taking sexual offences seriously, given that such offences are committee every day, are serious and all too often involve children, who are scared for life by such vicious crimes. In the end, it is society that pays for this at the psychological, medical and other levels.

This clause could include specific provisions on sexual assault, so as to force judges to impose consecutive rather than concurrent sentences as they sometimes do. However, this would take away some of the discretionary power of the courts.

I have some concerns in this respect. I am in favour of the bill. I would like the committee to give very serious consideration to the bill as a whole to determine if the changes proposed by the hon. member would not in fact hinder the smooth operation of the judiciary and infringe on the discretionary powers currently enjoyed by judges.

If we look at how sexual assault and sexual offences against children, women or minors are dealt with by the courts across Canada, in Quebec, Ontario and the other provinces, I think judges do not take this kind of offence seriously enough. There are cases where certain comments made by a judge lead us to question the sentence imposed by that judge.

With this amendment, when there is more than one offence, the judge would have to impose consecutive sentences and we would then be sure that the accused would serve all his time.

The Bloc Quebecois believes that offences against the person must not be taken lightly. Our criminal justice system must consider the seriousness of offences such as sexual assault and murder. We also believe that the establishment of a rule with regard to consecutive sentences for sexual assault should be studied by the Standing Committee on Justice in light of our concern not to unduly limit the discretionary powers of the courts.

The courts are still in the best position to analyze individual cases, but I think that sometimes we have to force the hand of justice. We do it from time to time in certain pieces of legislation. As legislators, it is our duty to do so.

The Bloc Quebecois still wants to issue a word of caution—and it is not necessarily the member but rather the Reform Party that has a tendency to do that—to those who could be tempted to legislate on the basis of an exceptional case such as the tragic case of Clifford Olson. The justice system as a whole must not be judged on the basis of a few exceptional cases.

Again, if we look at the Canadian justice system as a whole, it is a good system. It works well. Naturally, we can try to improve it and I think Bill C-251 is a step in the right direction.

That is why I will co-operate in committee to see to it that this bill is adopted or even to improve it if necessary.

[Rose-Marie Ur, Liberal, Lambton—Kent—Middlesex, ON]

Mr. Speaker, it is a privilege to rise this afternoon to speak in full and complete support of Bill C-251 and to salute the efforts of our hon. colleague, the member for Mississauga East. I believe the member has done Canadians a great service with the bill and I am pleased that it has been deemed a votable item.

Our colleague's sincerity and dedication when it comes to issues of justice, sentencing and working with victims of crime are recognized and appreciated, for perseverance and raising awareness of this issue and her devotion and commitment to helping victims of crime are qualities for every Canadian to admire.

Bill C-251, as members will know, provides for the imposition of a consecutive sentence where a person commits sexual assault and another offence arising out of the same event or where the person is already serving another sentence at the time.

The bill's summary clearly states:

—a person sentenced to life in prison for first degree murder or second degree murder is not eligible for parole until the person has served, in addition to the portion of sentence that the person must serve for murder, one-third or a maximum of seven years or any other sentence imposed—in respect of an offence arising out of the same events or that person is already serving. The mandatory portion of each life sentence imposed on a person who is convicted of a second murder must be served consecutively before the person is eligible for parole.

As I see it, you do the time if you do the crime. It is important to point out that both victims groups and the Canadian Police Association support the bill.

As a citizen of Canada and as a member of parliament, I am fully aware of the tremendous service men and women in law enforcement provide us as they discharge their responsibility to protect and defend our lives, liberty and property. We honour them and offer encouragement.

Law enforcement officers are the most unselfish and dedicated public servants in society. We have all heard over and over again that each day as they go about discharging their responsibilities law enforcement officers place their lives on the line.

People should not just pay lip service to this statement. The citizens whom they protect should be conscious that many times law enforcement officers experience a tremendous amount of frustration. They are required to work within a criminal justice system which at times is too inefficient and too technical to handle the various examples of crime in society. Regrettably on terrible occasions they make the supreme sacrifice for the people they serve. They know that Bill C-251 would help keep hardened criminals off the streets. In my capacity as an elected member of parliament I want to be able to give them the tools to work with and within.

Each day we are reminded with vivid reality that we live in an imperfect world, one beset with many problems such as poverty, injustice, disease, war and most assuredly crime.

Some who are skeptical would say that this is nothing new, that these problems are part of the human condition and will be with us as long as men and women remain on earth. They will get caught up in the magnitude of the world's dilemmas and with fatalistic acquiescence. They will sit and do nothing, justifying this inactivity with the platitude “I am just one person. I can't change the world”.

The member for Mississauga East is doing her part, and I may add doing it well. Without individual action by citizens the problems may continue to worsen as more people become victims of crime. There is no greater satisfaction than that which comes from the feeling that one has contributed something good to society, that one has given in the support of others. The profession that gives an opportunity to achieve this is law enforcement work.

Bill C-251 will give Canadians and victims of crime perhaps some additional peace of mind than otherwise would occur. It will correct a shameful volume discounts to rapists and murderers through concurrent sentencing. The bill is about reasonable and required change that every major victims group is demanding.

Bill C-251 has three important objectives: to reduce inhumanities to families of victims, to restore some truth in sentencing and to stop gambling lives away on the chance that a multiple murderer or serial murderer will not attack again.

What is punishment? Punishment is a detriment imposed for committing a crime. The four widely accepted purposes of punishment are deterrence, retribution, incapacitation and rehabilitation.

During the last 20 years many American states have shifted away from indeterminate sentencing. The Canadian Sentencing Commission issued a 592-page report in 1987 that found abundant evidence of unwarranted disparities in sentences as judges took different approaches to similar cases.

The bill is important due to the shift away from indeterminate sentencing. It seems to reflect a reduction in confidence in rehabilitation as a purpose of punishment and a reduction in confidence of parole boards in deciding when an offender should be released.

When sentencing an offender for multiple offences in Canada the primary focus is on the global sentence that results from the judge's discretion. Some offences, most notably prison escapes and breach of conditional sentence, require mandatory consecutive sentences under subsection 718.3(5) of the Criminal Code of Canada. However throughout the focus remains on the global sentence to be imposed.

Bill C-251 would change that for the better. As my colleague from Mississauga East stated during debate on June 4, 1996:

Concurrent sentencing cheapens life. The lives of individual victims are erased from the sentencing equation. The suffering, the pain and the death of the second, third or eleventh victim is of no consequence to the courts.

I wonder if we could apply that kind of sentencing if we had a parking ticket. If we got one or ten, would the court see fit to only charge us for one?

As well, families must continue to attend parole hearings, reliving and rehashing pain, anguish and grief over the loss of a loved one. Let us support victims of crime. Let us support our law enforcement officers. We as members of parliament have an important role to play with this unique privilege we have been bestowed by our electorate.

Changing and improving legislation is a vital part of that role, and each of us take it very seriously. That is why private members' hour is crucial to our effectiveness as members of the House. Individual members have the opportunity, free from party constraints, to express their views and concerns on behalf of their constituents, their conscience and their genuine interest in trying to make some positive changes.

It is with that spirit that I urge all hon. members to support Bill C-251 and the exceptional work on this issue by our colleague from Mississauga East.

[Chuck Cadman, Reform, Surrey North, BC]

Madam Speaker, I am very pleased to speak to Bill C-251, an act to amend the Criminal Code and the Corrections and Conditional Release Act.

I admire the hon. member for Mississauga East for her tenacity toward this legislation. This is the third time she has attempted to bring this legislation to fruition. She has indicated that she has the support of 166 members of the House, including support from all parties. That would appear to be sufficient to reach a majority, but I will not be holding my breath. We have seen how government members soon forsake conscience and common sense once they receive the marching orders from the front benches.

In 1993 the Liberals campaigned on a promise to give backbenchers more weight in the government by providing MPs with a greater role in drafting legislation. More free votes were to be allowed. Now, almost five years later, we still do not have successful private members' legislation in the area of criminal justice. The House can appreciate my scepticism.

The House may also appreciate my concern over the inconsistencies of the hon. member for Mississauga East and many of her colleagues on that side of the House. In Bill C-41 in 1995, when they voted in favour of conditional sentencing, one must assume they did what the former minister of justice instructed them to do.

Just last week I note another sexual offender received absolutely no jail time for sexual assault and forcible confinement. This example is but just one of the most recent. There have been many other cases where sexual offenders have received the benefit of the Liberal Bill C-41 get out of jail free legislation.

On the one hand the proposer of the bill before us seeks increased sentencing for sexual offenders, but on the other hand she appears to say that it is okay for sexual offenders to serve their time at home. No wonder Canadians have lost faith in their politicians.

When this legislation was last debated in this place the then parliamentary secretary to solicitor general clearly put the writing on the wall for government members. He stated:

I am concerned that Bill C-251, an act to amend the Criminal Code and the Corrections and Conditional Release Act, may take away flexibility and discretionary power from our courts and add to the already heavy burden of correctional bodies, when it comes to administering sentences.

He appears concerned about the administrative cost of keeping violent offenders in prison. We could only wish the Minister of Finance would express the same concern over the cost of administering the GST.

Later the then parliamentary secretary stated:

The proposed amendments, however, invoke punitive measures that far exceed the restrictions now set out in the Criminal Code and Corrections and Conditional Release Act as well as threaten freedoms defended by the Charter, as I mentioned.

I suggest the word freedoms has no place in any discussion of sanctions for criminal activity. Here again we have an example of the Liberals' paralyzing fear of the charter.

Later on in his speech he added:

—the proposals now before us do not at this time reflect the best interests of the Canadian public.

That was a typical Liberal response that government knows best and the Canadian public is too stupid to decide for itself.

The parliamentary secretary was speaking for the front bench of the government. In this place there is little in the way of free votes for the government side. There is little likelihood of a substantive role in drafting necessary legislation by any backbencher, even those on the government side.

The parliamentary secretary once again used the charter as a reason for failing to respect the desires and needs of Canadians. It was noteworthy that he failed to explain just how the charter protects our most heinous criminals from receiving consecutive sentences. It was also noteworthy when he stated that these proposals did not reflect the best interests of the Canadian public.

Bill C-251 proposes to ensure that those offenders who commit sexual assault and another offence receive consecutive sentences. It ensures that murderers are not eligible for parole until they have served the sentence for the murder plus a stated minimum for any other sentence imposed.

The parliamentary secretary talked about the best interests of Canadians. I think he may only be thinking of the best interests of our criminals. He is certainly not thinking about the victims of those crimes and he is not thinking about the safety of our communities.

Just this past week another university study into sexual violence severely criticized our criminal justice system for not seriously dealing with this issue. It is more concerned with the interests of criminals than it is with the needs of victims or public safety. The study found that only 13% of child molesters and 30% of sexual assaults of adults result in sentences of more than two years. This was compared to robbers who in 53% of cases receive more than two years. Children and women are most often the victims of sexual offences but the government is doing little to address this anomaly. Perhaps this private member's bill will help to correct that failure.

Consecutive sentencing would provide incentive for our justice system to pursue a complete record of our offenders. Too often crown prosecutors proceed only with one or two charges against the accused. There is usually only one cumulative sentence so there is nothing to be gained from proceeding with multiple offences, but this results in a major travesty and injustice at the time of parole.

Parole is based strictly on convictions. For example, Larry Takahashi was granted day passes even though he had admitted to sexually assaulting up to 30 women and police believed he was responsible for up to 100 sexual assaults. As far as the parole system was concerned he was responsible for 11 sexual assaults on seven women. When it came time to review his record for day parole purposes, only the convictions were considered.

Consecutive sentencing would bring about truth in sentencing. Multiple offenders would be distinguished from the one-time offender. There would be more honesty in sentencing. Presently our judges impose, for example, a one year sentence for a sexual assault. The victims and the public are deceived into believing the offender actually serves one year in custody, but as we all know parole takes place for every offence.

Offenders such as in this example often get out in a few days or a few months. The judges say they do their job by applying an appropriate sentence for the crime, but then the parole system gets involved and officials have the responsibility to get the prisoner out of incarceration at the earliest legislated opportunity.

The parole system states that they are just doing their job of following the rules toward release, but there is no truth in sentencing. Few if any actually serve the full court imposed sentence of incarceration. Even our most heinous murderers get reviews of their life sentences at 15 years pursuant to section 745. A notorious child killer whose name I will not say in this place murdered 11 children but was sentenced as though he had killed but one.

As we speak, a section 745 hearing is in progress in Vancouver for a man who killed three bar patrons and then drove to an RCMP detachment where he murdered the constable behind the counter. He too was sentenced as though he had taken but one life.

If I might add, in that case the killer allegedly shot another constable in the police detachment but was never prosecuted for that because there was no reason for it as there would be no difference in the sentence. The message to the criminal: kill as often as you wish, only the first one counts, the rest are freebies. The message to the victims: only the first life is important, the rest are inconsequential.

As to the specifics of Bill C-251, I wonder why the hon. member restricted her bill to section 271, the sexual assault offence. If her bill is successful I can only wonder how things will work when we have an offender who commits a sexual assault with a weapon pursuant to section 272 plus other offences. Will the crown proceed with the lesser offence of mere sexual assault with the hope that the sentence will be added to those for the other crimes or will the crown proceed with section 272 and hope that its sentence alone will meet society's objective? It appears as though our crowns may become professional gamblers in our courts.

I also wonder why the hon. member proposing this bill restricts it to sexual assault and murder. She does not include manslaughter, instances of use of a firearm in the commission of an offence and she does not include aggravated assault.

To sum up, I will support this member's initiative but I seriously question whether her own party members will have the fortitude to support their conscience rather than meekly following the orders from the front bench.

I support this bill as a start. It is certainly a long way from providing sufficient protection within our communities. It is a long way from being totally honest with our citizens. It is also a long way from attending to the interests of victims. However, I urge all members of the House to support this bill.

[Dan McTeague, Liberal, Pickering—Ajax—Uxbridge, ON]

Madam Speaker, I am pleased to rise today in the House in support of this worthwhile bill, a bill the member for Mississauga East has been pushing for years and which is needed in today's society.

I know this member has tried on now three occasions to see that this legislation gets passed or at least recognized and thoroughly treated by parliament. It is an honour to know this member of parliament who subscribes to the view that if at first you don't succeed, try, try again.

It is with that that I am here today to once again speak to an issue that I believe seems to have a consensus developing in the House, at least making sure that this issue gets thoroughly debated not only in the House but in the justice committee .

I ask hon. members to consider that this is not really a partisan issue. We can play the usual jousting between both sides of the House. We all have different philosophies and we certainly have different dynamics within our constituencies. However, one thing we can agree on is the value of a human life.

This bill addresses very squarely, whether it be in the area of criminal justice or social understanding of humankind, the need to respect and to not denigrate the value of every human being.

My previous colleagues, including my colleague from Whitby—Ajax, spoke at length about the problems inherent with the system that gives volume discounts for serial murderers.

I am pleased to see that the Bloc critic has taken a stand on criminal offences of a sexual nature. I totally agree with him and I hope this will result in a piece of legislation the House can proud of and which we will be able to review together in order to come up with a better criminal justice system.

This summer the men and women who represent our front lines were assembled in at least three locations across the country to commemorate the passing of one of their own. In my riding of Pickering—Ajax—Uxbridge we mourned the tragic loss of Det. William Hancox.

I do not know whether we have had an opportunity to recognize that but I would like to take the time now to make sure the House of Commons hears his name and the great effort he made on behalf of keeping this nation a secure nation.

I know there are people in the gallery today representing our finest in this country. They are not here to simply hear about the outcome of this bill but to understand that there is a relationship between the need for public safety, the security of the person and the whole definition of a social contract on which this whole issue seems to rest.

It is for those reasons that I applaud the attempts of my hon. colleague from Mississauga East. I applaud the efforts of so many of the victims rights groups in the country who have been crying out for a voice and who ask above all that we not play this simple game of politics, of divide and conquer, or to hide behind certain laws, customs or traditions.

Common sense dictates that this House today consider the impact it has on the security of the individual and the value of life. The status quo is clearly not acceptable and it is in that regard that the wisdom of the subcommittee on private members' business chose wisely for the first time to make this bill votable.

This bill is certainly deserving of an opportunity to be treated by the justice committee. I have some difficulty with the interpretation of where this could go and I would probably want to ask for a clarification of a statement that was made by the Chair a little earlier, that this bill be referred to the finance committee. I seek unanimous consent of the House, seconded by the member for Huron—Bruce, to amend the direction of this bill from the finance committee to the justice committee.

[The Acting Speaker (Ms. Thibeault)]

For the information of the member, the bill is going to the justice committee, not to the finance committee, as the member thought.

[Dan McTeague, Liberal, Pickering—Ajax—Uxbridge, ON]

Thank you for that clarification. I know this bill is very important and we want to make sure there is absolutely no equivocation and that this bill does proceed in the direction it so clearly deserves to go in.

I do not think this bill is about vengeance. I do not think this bill is about retribution. I do not believe this bill was born out of some idea of vindictiveness. I believe rather that this bill has everything to do with the value we in this House and we as Canadians place on human life.

The bill itself, as I suggested earlier, comes from an evolution of a number of thoughts that have been brought forth. It is easy to talk about the Clifford Olsons of this world, the Paul Bernardos, the Denis Lorties, but I think we need to look at something a little more substantial about the role of the victim in terms of the system that currently exists.

As I indicated earlier, the status quo is not acceptable. My hon. colleague from Whitby—Ajax indicated that second degree murderers sentenced to life are released after less than 12 years. The median for first degree murderers is only 14 years.

I do not believe anybody in their right state of mind would accept that a human life is only worth such a trivial time behind bars. It is for this reason that I believe there is an opportunity for us as members of parliament to recognize the great gulf that exists between common sense, the view of the public, the view of so many legalists who have pronounced themselves on this.

In terms of ensuring that we have a sentencing system that reflects the seriousness of the crimes that are committed, it seems only reasonable that if you commit one murder, one rape, one assault you should serve the time for each.

It is not a question of simply the trite statement if you can't do the time, don't do the crime. It is rather a question of ensuring that an offence against an innocent human being is treated adequately and appropriately. In that context there is no need to talk about tying the hands of judges. I saw in Burnaby, B.C. last year with the hon. member and so many other members in the House the spectacle as a result of 745 of Clifford Olson being allowed to manipulate the system. The judge did not have in his mind the desire to make sure this individual would never see the light of day and that he would spend his time behind bars.

This is not about revisiting capital punishment. It is rather an important step ahead in recognizing and in modernizing our justice system to reflect accurately the angst of victims, the sensibility of their families and the reasonability of all Canadians.

I am very proud to be here today. As I said the last time I spoke to Bill C-274, moved by the member for Mississauga East, this issue will brought back to the House as long as it is not willing to acquiesce to it.

I assure members it is a good bill. It deserves our support. Let us support the bill. Let us get the bill to committee and let us protect Canadians.

[Chuck Cadman, Reform, Surrey North, BC]

Madam Speaker, on a point of order, may I just correct the last speaker. He referred to Burnaby. I would like to correct that to Surrey. Surrey is my town and I cannot let that go.

[Mark Muise, Progressive Conservative, West Nova, NS]

Madam Speaker, I am pleased to rise today on Bill C-251, an act to amend the Criminal Code and the Corrections and Conditional Release Act.

This is an extremely important piece of legislation and I salute the hon. member for Mississauga East for bringing forward the bill despite the opposition from her own government. We need more initiative and free thinking from both Liberals and Reform instead of their respective leadership constantly cracking the whip.

Let us hope the hon. member for Mississauga East will not face the same wrath from the Liberal leadership as the hon. members for North Vancouver and Nanaimo—Alberni had to face in September at Banff.

With respect to Bill C-251 this is very timely when one looks at how the Liberal government has responded to the various justice issues this week in the House. Yesterday we witnessed the Parliamentary Secretary to the Minister of Justice defend the faint hope clause by proclaiming I am proud to be a bleeding heart Liberal.

On Tuesday we witnessed Liberal after Liberal stand up to defend Bill C-68, the false hope law, by criticizing law abiding gun owners as being part of some vast right wing conspiracy. I am nonetheless encouraged to see a member from the Liberal benches stand up for what she believes in with this bill. I know she has been working very hard over the past number of years to bring this matter forward in the form of a votable motion. She has stated in the past that Bill C-251 is based on three simple principles: inhumanity and how to avoid it, improving humanity toward victims, and certainly to protect us against those who offend.

My colleagues in the Progressive Conservative caucus and I share the deep concern of the hon. member for how difficult it is for victims of crime to face the justice system and how far too easy it is for them to lose faith. Our party's justice and solicitor general critic, the hon. member for Pictou—Antigonish—Guysborough, has proposed a number of solid initiatives to ensure that our laws better reflect the needs of victims and their families.

Parliamentarians now have an opportunity to support this important piece of legislation to help improve our justice system, to help restore the confidence of Canadians in the system and more important, to improve the protection of society from violent offenders. These are very positive suggestions the hon. member has made.

Bill C-251 provides for truth in sentencing, something we must see. It is a very brief, straightforward and easy to understand amendment to the Criminal Code. This is something which all members of this House should encourage.

When it comes to the issue of sexual assault and section 271 of the Criminal Code, there is a strong need for this amendment. There is a need that sentences which are imposed by judges be served consecutively so that the punishment reflects the gravity of the offence.

At the present time there is the ability for these types of sentences to be served concurrently. That is, if there is more than one offence or the offence of a sexual assault occurs at the same time as other offences such as break and enter, theft or simple assault, the sentences are served at the same time. In simple terms this would be similar to having loans from three different institutions and only having to pay back one.

The principles of sentencing are set out in the Criminal Code of Canada. Section 718 of the code sets out what legislators in the past have tried to do and tried to reflect in the sentencing principles.

Section 718.1 states “A sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender”. It goes further in setting out what these principles are and it speaks of the need for reformation and rehabilitation to be balanced against the more important principle, the protection of society.

The Criminal Code further states “Where consecutive sentences are imposed, the combined sentence should not be unduly long or harsh”. Try explaining that to a victim of a violent crime. Try explaining that to those who have lost their loved ones or had their loved ones attacked, beaten or killed.

We must revisit the principles of sentencing. The suggestion by the hon. member does just that in a positive way.

Bill C-251 would expand the ability of judges to impose a fair sentence. No one should be getting a free ride in our justice system. Sadly this is precisely what happens far too often. We permit sexual offenders and other offenders who commit two, three or more crimes to serve one sentence at one time. It is absolutely absurd.

The name Clifford Olson is heard much too often in this House and the mere mention of this name makes me shiver. This individual killed 11 children and received only one life sentence. He should be serving 11 life sentences.

The manipulative and self-serving testimony he gave at his section 745 hearing was simply outrageous and an embarrassment to all of Canada, and particularly to our justice system.

No sentence could be harsh enough considering the horrible crimes committed by that scum. The details of some of them would be enough to turn anybody into an alarmist and a reactionary. However, we must look at sentencing carefully. Common sense must always prevail.

In the case of individuals like Olson and Bernardo, it is absolutely ridiculous to pretend that a sentence ranging from 15 years to life is an acceptable punishment.

That is why my colleague the justice critic for the PC party continues to fight for the repeal of section 745, the faint hope clause. That is why we support the efforts of other members of this House, such as the member from British Columbia yesterday, to repeal the faint hope clause.

I call on all members from the member for Mississauga East to the members from the Bloc and the NDP to join with us in our fight to get rid of this ill-advised section of the Criminal Code.

The principles that underscore this bill are completely useless as long as we continue to have section 745 in the Criminal Code. It is my belief that each of the innocent lives that were taken at least deserve the validation of having a consecutive sentence to represent their lives. A person who commits multiple crimes should be given an appropriate sentence to reflect each and every one of those offences, if committed at a different time with different circumstances. This principle reflects the views of most of my constituents and most Canadians.

Bill C-251 addresses this principle in a common sense manner. Therefore I support the member for Mississauga East and I support her bill.

I am extremely proud to support it. I recognize the importance of consistent sentencing. I personally think that the justice system should not weaken the ability of our society to protect itself and to show its abhorrence of violent crime.

The second clause of Bill C-251 amends section 120 of the Corrections and Conditional Release Act. It requires offenders sentenced for first and second degree murder to serve their full parole ineligibility period on the sentence plus one-third of a maximum of seven years, whichever is less.

As with the first clause of Bill C-251, it is an innovative way to ensure that there is some truth in sentencing. There are times and factual circumstances when the judge should impose a sentence that would really reflect what the crime represents. If a judge says 25 years, it should be 25 years. That should be the end of it. That would give the offender and society faith in their justice system. Cumulative sentences play a very important role when it comes to parole eligibility.

Bill C-251 would be the best way to address cases of double murders. The victim's family of the second murder are forced to face the fact that their victim is not being addressed by the justice system when the sentence has to be served concurrently.

On behalf of the Progressive Conservative Party, I support this bill and hope that all members support the efforts of the member for Mississauga East.