Debates of Oct. 28th, 1999

Points Of Order

[Randy White, Reform, Langley—Abbotsford, BC]

Mr. Speaker, the member made a very serious accusation. Equally serious is the fact that he does not know who said it or particularly where it came from. How is it possible to stand up in the House and make an accusation not only against one of our colleagues in the House but against a party when in fact he does not even know if it is in fact from the Reform Party.

I ask the member, in all fairness, that if he does not know then he should actually retract his comments.

[Bill Blaikie, NDP, Winnipeg—Transcona, MB]

Mr. Speaker, I find the suggestion that somehow the hon. member for Halifax West should withdraw his remarks ridiculous on the face of it when Hansard actually records the fact that this was said. The member has said that he knows full well that it came from the Reform Party. He has made that claim and will stand by it. The fact is that somebody in the House said this. Whoever that person was ought to own up to it and withdraw it for all the good reasons that the member for Halifax West elucidated in his speech.

The Reform Party, instead of trying to defend this and trying to avoid the reality of this, should show a little more shame and say they will find out who among their members did this.

[Ken Epp, Reform, Elk Island, AB]

Mr. Speaker, I would somehow appeal to not only you, but also to the member making the accusation, that perhaps he has jumped ahead in an interpretation of what was said. It seems to me that when he says that we are in chains, he in fact is very free. Could the meaning not have been that the members are not now also physically in chains as this member is not? That would be the charitable interpretation of this statement.

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

Mr. Speaker, as a member of the Reform Party and somebody of mixed background, I find it personally offensive that the member from the NDP would make such a claim on this party.

I have read Hansard and Hansard clearly states that an hon. member made a claim “Just like him”. I would put to the member, who is also of mixed background, that he cannot claim at all that the comment was made by this party. As a member of this party, I can tell the House right now that there is not a single racist bone in this party.

[The Speaker]

I will recognize the hon. member for Palliser, but I ask him, is he prepared to identify the hon. member?

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, I was in the House when the member for Halifax West made his comments. I did not see the lips move but I heard and recognized the voice of the member for Prince George—Peace River as saying that comment.

[The Speaker]

We have a point of order raised by the hon. member. We have a member named. The hon. member is here in the House with us. The hon. member for Prince George—Peace River.

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, I was present last night during the debate. The hon. member is quite correct. I do not recall what was said. There were a lot of heated things said from all parties during the debate last night.

I want to assure the House and everyone watching today that if I did say something, and I am not saying I did, it certainly was not meant as a racist slur as the hon. member has accused. If whatever I said caused him any discomfort, I apologize.

[The Speaker]

Colleagues, the point was raised. We have heard a statement by hon. members. I consider the matter closed.

Business Of The House

[Grant McNally, Reform, Dewdney—Alouette, BC]

Madam Speaker, this being Thursday, it is a pleasure to be able to finally ask the Thursday question.

In light of some serious issues, such as the airline industry restructuring, the Marshall decision on the east coast and its impact on other areas across the country, the serious concerns of agriculture and of course our broken immigration system, I am wondering if the House leader from the government side might be able to tell us the business of the government for the remainder of this week and the week following.

[Don Boudria, Liberal, Leader of the Government in the House of Commons]

Madam Speaker, I want to thank the hon. member for Dewdney—Alouette for asking me this very important question.

Let me take a moment to describe the business of the House between now and the break during Remembrance Day week.

Today of course is the Bloc opposition day. On Friday, the government orders that will be called will be Bill C-4, the space station bill, and Bill C-5, the tourism bill.

On Monday, the present intention is to call Bill C-9, the Nisga'a legislation.

Tuesday shall be an allotted day.

Next Wednesday, it is our intention to call the report stage of Bill C-8, the marine parks bill. For those members who are familiar with the last session, I believe it bore the number Bill C-48.

Next Thursday, it is our intention to resume consideration of the proposed Address in Reply to the Speech from the Throne.

Next Friday, we will deal with any aforementioned business not yet completed should that be the case. If that is not the case then we will take other bills still on our list, perhaps the municipal grants bill if that bill is available for us to consider.

The House resumed consideration of the motion, and of the amendment.

Supply

[Guy St-Julien, Liberal, Abitibi, QC]

Madam Speaker, I will be dividing my time with the Liberal member for Mississauga West.

I am speaking today in the context of the policy framework made public earlier this week by the Minister of Transport.

I must thank the minister for appearing before the Standing Committee on Transport and all of its members. His vision of a Canadian airline industry that is not only safe and prosperous, but also meets the needs of Canadians in the XXI century is clear and lucid.

That vision identifies the issues requiring government action and the areas in which such action will make it possible to strengthen this industry on the eve of the new millennium.

One of the questions being debated is the possibility of amending the Air Canada Public Participation Act. Under this legislation, no individual or group of individuals may hold or control more than 10% of voting shares in Air Canada.

When Air Canada was privatized in 1988 and the Air Canada Public Participation Act came into effect, the view at the time was that Air Canada shares should be spread over a large shareholder base. Whether that point of view is still valid in 1999 is debatable.

In his statement on his policy last Tuesday, the minister indicated that he was prepared to increase this limit, if, and only if, doing so would help achieve the objective of a prosperous airline industry under Canadian control.

To this end, the minister asked the two Standing Committees on Transport to examine the question of the 10% limit and, after consulting the main stakeholders and considering the future of the industry, to make recommendations on a possible change to this limit.

All the members of this House know that the airline industry must undergo major changes; they are inevitable. The broad policy for the restructuring of the airline industry in Canada the minister presented to us establishes guidelines for the transformation of an industry, currently comprising two main carriers, into an industry in which a dominant carrier will emerge.

In this regard, the public at large, consumer associations, independent carriers, travel agents and other stakeholders have raised serious concerns about the impact of consolidation on competition in the airline industry.

In fact, in my big region of Abitibi—Baie James—Nunavik, with over 36 airports, and airlines such as Air Inuit, Air Creebec, First Air, Air Boréal and Air Wemindji, First Air is the third largest regularly scheduled airline in Canada and its Inuit owned parent company, Makivik, is paying close attention to statements and actions by the various groups in the reorganization of the airline industry in Canada.

The fear is that a dominant carrier could, by design or inadvertently, act unfairly. Such action would eliminate or limit competition with the intent of controlling air traffic.

In August of this year, Canada's Minister of Transport wrote to Konrad Von Finckenstein in his capacity as Commissioner of the Competition Bureau. In particular, the minister called on the commissioner and the bureau to help the government develop a position that would take the interests of Canadians into account, while giving the private sector the necessary leeway to develop proposals for the structure of a viable industry. The bureau's response, dated October 22, was made public last Tuesday.

I would like to take a few minutes to examine certain issues having to do with domestic competition that were identified by the Competition Bureau.

I am referring here to the issue of predatory pricing and to the issue of airport access. The Competition Bureau notes that a dominant carrier will have both the incentive and ability to engage in various types of anti-competitive behaviour, including predation. Within the airline industry, predatory behaviour can take various forms, including predatory pricing.

Predatory pricing occurs when an airline temporarily sets low fares to inflict losses on one or more rival airlines, or matches fares while adding additional capacity. Once it has eliminated the competitor, the carrier restores higher prices.

The policy framework announced by the federal Minister of Transport deals with this very issue. The document states that “Small and new entrant carriers are potentially vulnerable to excessively aggressive competitive attacks from a larger, established airline. Small carriers run the risk that a dominant carrier may try to drive them out of a market or out of business by substantially lowering fares and increasing capacity in the short run with the intention of recovering the short term losses with price increases in the long run”.

Initially, consumers might seem to benefit from lower prices, but the long term result will be a narrower range of choices and higher prices.

The federal Minister of Transport stated that predatory prices will not be tolerated. According to the overall policy, the Government of Canada must ensure that effective measures are taken to deal with abuse in the air transportation industry.

The commissioner recommended that some sections of the Competition Act and its regulations be amended to grant him the authority to act in this area. Under the overall policy of the federal Minister of Transport, the government recognizes that this is a key issue which must be dealt with decisively.

The minister has asked the House and Senate committees to make recommendations on the best way to reach this goal.

Also, small or new air carriers have trouble gaining access to airports. This is a complex problem that was also examined in detail by the Competition Bureau.

In order to be competitive, new Canadian carriers must get reasonable access to departure and arrival slots as well as various airport facilities, such as boarding gates, loading bridges and ticket counters.

The federal government intends to come up with innovative ways to facilitate access to airports. I would like to elaborate on this point.

A “slot” is an expected time of departure or arrival that is available or allocated to a specific airline, for a specific date, at a specific airport. Take, for example, Toronto's Pearson airport. It is the only Canadian airport that is currently operating at full capacity. It is also the airport where most new entrant carriers will want to land.

A carrier created by merging Air Canada and Canadian Airlines would use up a large portion of the slots at Toronto's airport, particularly during peak hours.

Since the slots are reserved for carriers as long as they need them, it would be difficult, if not impossible, for other carriers to get enough slots to establish new services.

The policy framework announced by the federal Minister of Transport deals with this specific issue. It notes that independent carriers and airport authorities have identified access to airport facilities at the large congested airports as a potential barrier to competition.

Without being able to offer services at Lester B. Pearson International Airport in Toronto and other major airports, new entrant carriers and other small carriers will not be able to compete effectively against a dominant carrier.

The policy framework states that the dominant carrier may need to give up some of its access to congested runways so that other airlines can add to their domestic services.

Guidelines or regulations to ensure fair and competitive allocation of slots may be needed at Toronto and at any other airports where slot control proves necessary.

The guidelines would ensure that a reasonable portion of the surrendered slots comes from the most congested times, days and seasons, as these slots are the hardest to obtain.

In conclusion, in a restructured industry with a dominant carrier, it will be necessary to promote competition. The government intends to put in place the necessary mechanisms to encourage the arrival of new entrant carriers and the growth of existing ones, such as First Air, Air Inuit, Air Québec, Air Canada, Air Wemindji, Canadian Airlines and others in Canada.

[Gérard Asselin, Bloc, Charlevoix, QC]

Madam Speaker, my colleague from Abitibi—Baie James—Nunavik comes from a region similar to the north shore. It is served frequently by two airlines, but services are very limited.

The member will have to convince me that the level of air transportation services depends on the merger. Will a merger ensure efficient air transportation services in the regions, be it through Onex, Air Canada or Canadian?

The quality of services at airports is already in jeopardy. Services in the regions have been diminishing. The frequency of flights is left up to the carriers. The price of a ticket is very high for travellers who have to fly.

I would like the member for Abitibi—Baie James—Nunavik to reassure me that the transport minister's involvement and his being in connivance with Onex on this issue will in no way hinder any possible agreement between Canadian and Air Canada.

If Onex were to acquire Air Canada and Canadian, I have my doubts, I fear, and I am almost convinced that this company would serve American interests first and foremost. I would rather we maintain our autonomy with regard to air transportation, with Canadians keeping control of the airline industry.

[Guy St-Julien, Liberal, Abitibi, QC]

Madam Speaker, I have taken careful note of the hon. member's question.

I am indeed from a large region encompassing Abitibi, Témiscamingue and Nunavik. It is the largest region in all ten Canadian provinces, with an area of 802,000 square kilometres, 36 airports, a population of 100,000, and 68 mayors, counting the aboriginal chiefs and mayors in Nunavik.

In committee, the Minister of Transport spoke several times of northern communities and small communities. On October 12, I introduced Motion M-129 to the House, to protect northern Quebec. On October 19, I asked some questions in a transport committee meeting. I also did so on October 26.

Yesterday, I made a statement in the House, precisely to send a message about the north to the Minister of Transport.

Mr. Davis, the President of First Air, is asking the minister to oppose any agreement that does not specifically guarantee the interests of northern consumers, the people of the Arctic and of Northern Quebec, and those of the aviation industry and its employees, airports and investments.

The President of Makivik, Peta Aatami, said the same thing I have said several times here in this House: AThe federal government is legally and morally responsible for protecting the interests of the Inuit covered by the James Bay and Northern Quebec Agreement who could be affected by any reorganization of the Canadian air industry.

In response to the member's question, the Government of Canada stated, as outlined in the minister's speech, that it was going to respect small communities, both those in the south and those in major centres such as Val d'Or and Amos, as well as the airports at Lebel-sur-Quévillon, Matagami and Radisson. I could go on, there being 68 in all within my riding. Particularly in the Sept-Îles sector and other parts of Northern Quebec, the Government of Canada must respect the progress that has been made in air transportation to date.

[Pierre Brien, Bloc, Témiscamingue, QC]

Madam Speaker, as a member of the previous Progressive Conservative government, which brought us deregulation and astronomical increases in fares, including for our region, while promising us that this deregulation would promote competition and thus lower fares, the member for Abitibi—Baie-James—Nunavik is not worried.

He must know that the basic fare for a flight from Rouyn to Montreal and back is over $600. In addition, does the fact that an American company, namely American Airlines, will indirectly become the owner, and that this will be a quasi-monopoly, or just about, not worry him even more?

He should rise in his place and denounce the Onex proposal, which will have a disastrous impact on a region such as ours.

[Guy St-Julien, Liberal, Abitibi, QC]

Madam Speaker, the hon. member has asked me whether I should not be speaking out.

We have nothing to learn from the separatists and the péquistes. We need only mention Québec Air. What did they do? The PQ government never held any hearings before the transport committee. It signed orders. It did not protect northern regions.

Today, I am here to protect northern Canadians, and that is what I am going to do. My message is that I am here to defend my constituents.

[Ghislain Fournier, Bloc, Manicouagan, QC]

Madam Speaker, I am pleased to speak today to my party's motion to maintain the provisions of section 6.1(a) of the Air Canada Public Participation Act limiting ownership of the capital stock of Air Canada by any person or group to 10% of the voting shares.

I want to say that this government's conduct is disturbing.

Everywhere I have been—last night, I attended two meetings and 200 people came to the first one—I can tell you there was unanimity within the community and among groups, and the Bloc Quebecois is leading a fierce battle and will continue to do so. Looking at what the government is doing today, I would never have believed a democratically elected government could stoop so low in its loyalty.

I think transparency is being dealt a terrible blow and this government does not have notion of what justice is. This is purely and simply a dictatorship. I indicated earlier that there was unanimity within the community and the business community in particular, but the media are unanimous as well.

Anyone who paid attention to the media, both print and broadcast, this morning, noted that they were hard on the government. I would like to quote two articles, because if I had to quote all those I read this morning, I could go on all afternoon, and if we had to record everything that was said on television last night and this morning, we would not get out of here tonight.

The article I will quote is from the Journal de Montréa l and is written by Michel C. Auger. It is entitled “Alas, he is a minister.” It reads: “If David Collenette were a judge, we could easily—”

[The Acting Speaker (Ms. Thibeault)]

I must interrupt the hon. member. The member knows full well that a minister or a member of this House cannot be named and that quoting something cannot be used as an excuse to do so.

[Ghislain Fournier, Bloc, Manicouagan, QC]

Madam Speaker, that is how the article reads, and I asked permission to read the article, but I will refer to the Minister of Transport.

I was saying:

We could easily have him disqualified for being biased in the matter of the airline merger. Unfortunately, he is a minister. For quite some time we suspected the Minister of Transport—

This is not the Bloc Quebecois speaking. That is what was written in the paper this morning.

—of being biased in favour of the Onex proposal, if only because of the remarkably close ties that exist between that company, Canadian Airlines International, and the Liberal Party of Canada. Tuesday, before the transport committee of the House of Commons, the Minister of Transport provided the last piece of evidence proving that he is indeed biased with regard to this issue. He announced that the federal government was prepared to suspend—without asking for anything in return—the application of the act that prevents an individual or a company to hold more than 10% of Air Canada shares. The 10% rule is important because it is the only legal obstacle to the Onex proposal, which is the only proposal that requires such a change. Such a rule limiting concentration of ownership was included, mind you, in practically all transactions to privatize Crown corporations over the last few years. While in the public interest, this limitation will be waived by the government in support of a proposal made by a private company. Most importantly, it was the only lever available to the federal government to have a direct influence on this transaction, which will determine to a large extent the future of air transportation in Canada. It is a rather unique situation. Onex made a proposal that could not even be considered without an amendment to an act of parliament. Practically at the first opportunity, the government announced that it would agree to this request and not ask anything in return.

The article goes on:

This is what the transport minister means by “parliamentary consultation”. It is a kind of consultation that is completely meaningless because it comes after the fact, after the vote on Onex's offer by Air Canada's shareholders. We might as well say that the transport minister works for Onex.

I did not say it, it is in today's paper. The article goes on:

Of course, if we do not allow the government to modify the 10% rule, Onex's offer will die.

It is quite clear.

We could always believe that the government does not want Air Canada to win by default. However, there must be an amendment to an act of parliament to make Onex's offer legal. That must be justified by saying that the Canadian public will gain something from it. Better guarantees for air service in remote areas could have been required.

For example, in my riding, on the north shore, the distance between Ottawa and Sept-Îles is 1,200 kilometres. And the price of tickets is very high. A trip from Ottawa to Sept-Îles costs more than $1,000.

The article goes on:

Do you know of many corporations that have got, with nothing in return, such favours from a government, when their bids were contrary to the law and could not have been made to the interested shareholders? But the Minister of Transport had nothing to ask for in return. We might as well say right away the minister works for Onex. Meanwhile, it has to be noted that this same government and this same minister did not lift a finger to help Air Canada, the more profitable of the two corporations, but the one that is unfortunate enough not to have friends in high places among the friends and the bagmen of the Liberal Party of Canada. What is even more ironic is when the minister states that once the airlines merger is completed, the government intends to be very watchful of the new monopoly, that it intends to protect the rights of consumers and the rights of official language minorities and that it will deal severely with any attempt to inflate prices. In short, the government intends to watch closely the new monopoly, but it claims that it has no role to play in the creation of the new monopoly and that it is letting market forces determine everything. As long, of course, as the market sees to it that the friends of the government end up the winners.

I really wanted to quote this article. I think I will only skim over the other one. I will not read from it, but comment on it. I will defend the position of the Bloc Quebecois.

In this morning's issue of Le Droit , we see that on air transportation “The Liberals do not agree with each other”.

But where are the Liberals? During the last campaign, a Liberal delegation came in my riding and told us not to stay behind the boards, but jump on to the ice instead. Where are the Liberal members for Quebec now, when they should be jumping in and exposing the unfairness of this government? We know for a fact that, in this government, only one vote counts, the Prime Minister's vote. If he votes yea, all Liberal members vote the same way. If the votes nay, they all say nay.

They do have a spokesperson. But the parrots all keep repeating what their boss says. They have marching orders. That is how the government views democracy. Did members ever see the hon. member for Vaudreuil—Soulanges stand up for Quebecers in the House and disagree with the government? Where is he? He keeps repeating the same old story and he tries to come up with a defence for the transport minister.

[The Acting Speaker (Ms. Thibeault)]

I am sorry, but the hon. member's time has expired.

[Gérard Asselin, Bloc, Charlevoix, QC]

Madam Speaker, I thank my colleague for Manicouagan for all this information. I did not have the time to read the press clippings this morning.

Yesterday, the minister told the transport committee “Safety remains Transport Canada's top priority”.

It takes some nerve on the part of an MP or a minister to say such things. How can the minister explain that, in Quebec's north shore and Gaspé region, we have had three plane crashes in eight months.

A Mira Aviation plane crashed on landing in Gaspé.A Nordair plane crashed in Sept-Îles, in the riding of Manicouagan. People were injured and the passengers had to call for help, because no one had seen the crash. Finally, an Air Satellite plane crashed in Baie-Comeau on December 7. That accident was witnessed by a six-year old girl, from her parents' residence.

When the federal government delegated to Nav Canada responsibility for transport safety, Nav Canada made cuts at the expense of passenger safety. It reduced the number of air traffic controllers, shut down control towers, and eliminated firefighting services at airports. Now, the federal government wants to privatize those airports, which already are not viable.

My questions to the hon. member for Manicouagan are as follows. Does he think that, in the region of Manicouagan and particularly in Sept-Îles—which is currently served by two airlines, namely Air Alliance and Canadian Airlines—the airport will be more viable? Will there be better customer service? Will travel agencies in his riding gain anything? They create jobs in his riding and provide ticket, reservation and checking services. The number of passengers will increase. Since 1996, travel agencies have been losing money. Yet, they create jobs. Could the hon. member tell me about his concern regarding current versus future airline services in Sept-Îles, which is the largest city of his riding of Manicouagan?

[Ghislain Fournier, Bloc, Manicouagan, QC]

Madam Speaker, I would like to thank my hon. colleague from Charlevoix. I congratulate him on the excellent work he is doing on the transport committee. His question gives me the opportunity to tell the House about a scandal that occurred at the Sept-Îles airport.

Money is not spent on enhancing security in the transportation industry, as the hon. member for Charlevoix pointed out. When I was city councillor, we were told that the airport was being transferred to us.

I was against the project, because the airport, which was located in my ward, came with an annual deficit of $2 million, $2.2 million to be exact. However, the city council met and I was there when we were told “Give us five minutes and we will explain how you can get rid of the $2 million deficit”. I said “You have been running a $2 million deficit every year for 30 years now. That is $60 million. Why were these measures not taken before today?”

They started by saying “We have a firefighting service with trucks and 9 firefighters that we pay for year round and have never been put to task. Besides, if there were a fire, there would not be enough pressure, as there is not enough water. We have a pumper, but it is not powerful enough. We have to get help from the Sept-Îles firefighters. There were two fires and both times the firefighters from the city of Sept-Îles were called to do the work. So we will get rid of the firefighting service and save almost a million dollars”.

We were told that there were three airstrips and only one was in use. It is 1,000 feet longer that the average strip and 50 feet wider. It can handle a departure and a landing every ten minutes. We could save $800,000.

There was a restaurant that took up a whole floor and cost $300,000 in heating bills. We were told it could be moved downstairs, that service would be better and the savings would be $200,000.

So, they reduced the deficit and there will even be a small surplus this year. This goes to show how the money was utterly wasted at Sept-Îles airport. However, security services are being cut, even though we have had fatal accidents.

[Pierre Brien, Bloc, Témiscamingue, QC]

Madam Speaker, we are debating today a motion tabled by the Bloc Quebecois asking the House of Commons to reaffirm its desire to maintain a provision of the act limiting the ownership by any company or person to 10 per cent of the voting shares of a corporation, especially in the case at hand of the eventual purchase of Air Canada by Onex.

Very seldom do we see a government intervene in a battle for control between private sector corporations by loading the dices as it has done in the present case.

Nobody will succeed in convincing us today that the government was not in league with Onex from the beginning.

Let us look at each stage of the process leading to the present situation—Onex' last offer was made only an hour and a half ago—and see how the actions of Onex and the government add up to what the member for Roberval described during today's Oral Question Period as “the crater we are inexorably headed for, which is the acceptance of the Onex project”.

Incidentally, Onex is the company which will take control, and which has a particular interest in this acquisition. One wonders about its long term intentions for the companies that it is trying to buy, Canadian Airlines and Air Canada.

It is very strange to note that, on the subject of these two firms, Canadian Airlines and Air Canada, the one in the greater financial difficulty today is Canadian Airlines.

If no changes are made at this point, Canadian Airlines' ability to carry on business in the coming quarters is very limited. It will probably have major problems—and this will not be the first time, because it has already had them—and, surprisingly, on a number of occasions, this very government, the federal government has come to its aid. Whether by providing foreign routes, or by providing funding when American Airlines arrived on the scene the first time, the federal government has always helped to bail out Canadian Airlines.

This time, however, it is becoming a bit too indecent to artificially support the company. Accordingly, a new player has arrived—Onex—which intends to join Canadian, with American Airlines behind the scenes, to take control of Air Canada.

Air Canada is the more profitable of the two companies, is the only potentially profitable one of the two and is being taken over by the other because of this intervention.

Even if last minute information gives the impression of a certain number of parameters being changed, it is not in fact the case when we look at the long term, the change to the rule of 10% is not insignificant in what is going on. It serves to give the advantage to the player or the hand holding the strings behind Canadian and behind Onex—American Airlines.

The minister is making fine speeches about “allowing the shareholders to speak, and when a definitive scenario has been decided upon—”, that is what the government is saying, “when it is all over, we are going to look after the interests of consumers and everyone else.” The government is setting out broad principles.

At one point, this government suspended part of the Competition Act and decided or announced that the 10% limit would be changed. All of a sudden and as if by chance, the very week of the deadline—the companies wishing to make a take-over have until midnight tonight—the minister announced his intention to review the 10% rule and demonstrate a very open mind.

It is hard to believe that the people from Onex, who seem to have a great familiarity with the people in the Liberal Party, the Prime Minister and the Minister of Transport, who are great pals, were not kept informed of the government's intentions.

Of course that would be very hard to prove, but the actions, the outcome and the progress of this matter demonstrate very clearly that there is a very close collaboration between certain people in government—those with influence and decision makers, anyway—and the people from Onex.

Where will all this take us? It will lead to a situation where the strongest of the two companies will find itself in a weaker position. In this case, Quebec, where Air Canada is well established, will suffer more job losses because of the federal government's involvement.

This also makes us wonder about a number of other issues in terms of the future, if the airline industry were to become predominantly influenced and controlled by a foreign company such as American Airlines, for example.

I am convinced that air transportation in the Abitibi—Témiscamingue region is not a top priority for American Airlines. What will happen to our regions?

We Bloc Quebecois members represent the regions of Quebec. I want to clarify something. Here in Ottawa, people talk about Quebec as if it were a single region. But the regions of Quebec include the North Shore, Lower St. Lawrence, Saguenay—Lac-Saint-Jean and Abitibi—Témiscamingue regions. When we talk about regional air transportation, we are not referring to Montreal-Toronto, but to air transportation to and from our regional centres.

We are very concerned. Earlier, my colleagues mentioned that airports had been taken over by the communities. If passenger and freight volumes go down, it will change the cost-effectiveness figures for the organizations that manage air traffic.

There are many things to consider. I am not even talking about airfares, which have already increased drastically since deregulation, with the result that it is now very difficult for people living in regions to travel at an affordable price. A traveller who did not plan his or her trip between Rouyn and Montreal well ahead of time to take advantage of a major rebate is looking at a round trip fare of more than $600.

By contrast, those flying out of Montreal or Toronto can travel quite far for the same $600. There is something indecent about this, particularly when you think that, because of the specializing that is taking place in the health sector, patients travel by plane wherever they can get treatment, which generates huge costs.

Regional development probably does not mean a lot to members opposite. It makes me laugh when I hear the Liberal member for Abitibi—Baie-James—Nunavik congratulate and thank the Minister of Transport for his work. He made this statement in a meeting of the Standing Committee on Transport.

I have no congratulations for the minister, far from it, and particularly not with regard to this issue. This same minister who closed the military college in Saint-Jean—let us not forget that—is now working to ensure that Quebec will come out a loser in this biased process in which the federal government has a hand.

There is obviously some disagreement within the government on this matter, and it is perhaps worth pointing out. There are some interesting quotations. In the October 26 edition of Le Devoir , Marc Lalonde, who is cut from the same cloth as the members opposite, had this to say:

It is odd that a public bid for a hostile takeover of the country's major air carrier should be launched on the assumption that the existing legislation will be changed to allow that takeover to occur. In all my years in the public sector, I have never seen a more disturbing challenge to the rights of parliamentarians.

God knows, Mr. Lalonde has been around for a long time. So this is one of their friends speaking, not a nasty separatist from Quebec. He says that the process has been biased from the start, because one of the players has the advantage of privileged information.

As for the fact that it will be possible to amend legislation, if necessary, what message does this send for other private transactions? The message it sends is this: “Stay on the good side of the members opposite and, if you are having trouble with a particular issue, worry not because we will take care of the legislation in due course, depending on our interests, the party coffers, and 56 other variables”.

There are members from Quebec in this government and others elsewhere who can also see through this transaction, and I am certain that the lobby was limited to a few government insiders. The policy must be changed, and the government must not agree to change the rules of the game mid-stream to the advantage of one player and one carrier.

[Gérard Asselin, Bloc, Charlevoix, QC]

Madam Speaker, as I said this morning in my speech, the Bloc Quebecois has contributed and will keep on contributing to the improvement of air transport in Canada, especially in Quebec regions.

Journalists will report again that Bloc Quebecois members are well prepared, that they attend every committee meeting, every sitting of the House. Aware of the urgency of the situation, today the Bloc Quebecois moved an opposition motion with a view to informing Canadians of what an airline merger will mean for them.

After putting questions to Air Canada officials, the minister, officials from the competition bureau, and Canadian Airlines yesterday, the committee will have the opportunity to hear from Onex next week.

From what Air Canada and Canadian Airlines were able to tell us in response to our questions, we have learned that Canadian Airlines has been talking to the transport minister since January 1999.

We are going through turbulent times. The air transport industry is going through a storm. The minister took it upon himself to amend section 47, essentially telling the competition bureau: “This is none of your business, I am using section 47 to give the airlines 90 days to prepare their bid and come to an agreement.”

Why did the minister not ask Canadian Airlines and Air Canada to sit at the table as early as January? Why did he not ask both major Canadian carriers to sit down together? Instead, he waited and opened up section 47 at the request of Onex. Then Onex tabled its bid. Air Canada made another bid. Onex had no choice but to make a higher offer. The decision will be up to the shareholders, those who own shares in Air Canada and Canadian Airlines. They will accept the best proposal with no regard for which offers the better service.

They will not look to see whether Rouyn-Noranda, Témiscamingue, the north shore, Manicouagan, or Gaspé have improved service. They will look to see which is the better deal. Shareholders will decide, not parliamentarians, and they will do it according to the proposals put before them.

The minister made promises to Onex. Onex said “I have a problem. If I become the major manager, if I put in a lot of money, I am taking a risk with the 10% rule”. So the minister replied “Well, we will increase it, we will change the Competition Act”.

Could the hon. member for Témiscamingue tell me why the 10% rule should be changed in this case, when it was not changed for Petro Canada? The Caisse de dépôt et placement du Québec was prevented from investing in CP Rail, and was told: “No, it is 10%”. The federal government said, about the bank mergers, “No, it is 10%”.

In this case, the Minister of Transport is saying “Onex will serve American interests, I will not have to subsidize anymore, to prop up an air carrier. It makes no difference if 10,000 jobs are lost. It does not bother me. You deal with the problem. Tell us what you need to buy both airlines. As for section 47, it is a done deed. We will amend the Competition Act. And as for the 10%, we will increase it to 25%”.

Why is the minister prepared to do so in this case, when it was not allowed in other cases?