Mr. Speaker, I wish to draw the attention of the House and anyone watching this debate to the fact that there has been quite an innovation introduced into this bill that I am very much in favour of. I do not think members of the House have noted it.
There is the suggestion that the small business loan program will be extended as a pilot project to the voluntary sector. In other words, the minister is suggesting this at least as an experiment to see what it is like to provide loan guarantees to organizations financing charities and non-profit organizations.
What is important here is that very clearly the not for profit sector is taking more and more of a role in society in providing certain social services, certain benefits.
In many senses this is a positive thing and in another sense it is a negative thing. What it really means, especially in Ontario, is that the Ontario government is getting out of providing the social services that governments normally provide. It is leaving it to non-governmental organizations like charities and non-profit organizations.
This minister has recognized that there is a major change coming in society. He is obviously, in this legislation and in the regulations that will follow, preparing for it by providing at least an experimental try at how we go about financing or giving loan guarantees to those who would finance not for profit businesses.
There are dangers to this because not for profit organizations operate as businesses but they have advantages in the sense that they do not have to pay taxes. If they are a charity, they actually can issue tax receipts that help them cut their costs when they enter into the marketplace.
There is a lot of controversy out there right now with not for profit organizations competing with for profit organizations in the marketplace. As an example, in my riding there is quite a controversy about the YMCA coming in to build an enormous facility for one of my communities. It will be financed entirely out of memberships.
The YMCA is a charity and the complaint is that private entrepreneurs who are selling fitness in the area are complaining that they are getting unfair competition from a charity.
There is some merit to the complaint of for profit companies when they find themselves up against a charity or non-profit organization that has the advantage of tax receipts or tax breaks.
Another instance is in Winnipeg where the Habitat for Humanity charity is in competition with a for profit used lumber recycler called Happy Harry's. Happy Harry creates jobs. He pays taxes and he is up against a non-profit organization that has advantages in the marketplace.
The warning is simply this. A not for profit organization is an umbrella term for non-profit organizations that do not pay taxes and for charities that do not pay taxes and issue tax receipts. Those are two categories of not for profit organizations that stand to benefit from the proposal in this legislation.
We cannot assume that because this is a non-profit organization or a charity it will be running more efficiently. The reality is that no matter what kind of business someone is in, if there is a profit incentive it usually leads to efficiencies. Take away the profit incentive then we run into the danger of a lack of accountability in the actual organization, the actual costs and the revenues and expenditures.
While I think this is a very intriguing and interesting experiment proposed by the minister and it is a good thing that we do this pilot project, I stress that we need to have a strong debate at the committee level and we need to make it very well known in the entire business community that we are proposing this initiative. We then may find a way we can support particularly charities that are engaged in business activities to the public good. However, we have to define the parameters and those parameters can only be defined through proper debate in this House and in committee.