Madam Speaker, I am happy today to debate Bill C-5, a bill that was first introduced in the last session. It is entitled an act to establish the Canadian Tourism Commission. If the bill passes it will take the existing Canadian Tourism Commission, which is part of Industry Canada at the moment, and give it crown corporation status.
The question that arises immediately, and I think the parliamentary secretary raised it as well, is whether a crown corporation is necessary for the Canadian Tourism Commission. I will attempt to make the case in my speech that it is not necessary and is more probably a case of empire building than real need.
The first question we have to ask is where is this real need coming from. Who is expressing it? The Canadian Tourism Commission was created in 1995 to promote Canadian tourism. It establishes partnerships with the private sector, the provinces and the federal tourism partners. It uses the money it receives from the various sectors to do research and to market Canada as a travel destination.
The CTC receives an appropriation of approximately $65 million annually. Of that amount, $12 million goes to salaries and overhead and approximately $52 million goes to provide promotion and product development. The industry matches the amount, so that a total of $140 million is spent annually. The CTC has 62 employees in Ottawa.
The CTC has a 26 member decision making board of directors which functions as a special operating agency in delivering the tourism mandate of the federal government. The board of directors is comprised mainly of private sector companies with direct interest in establishing Canada as a preferred tourism destination. My understanding is that the two big proponents of this are the airline industry and the Hotel Association of Canada.
When I received a briefing on the bill from the CTC, I was told the commission wants to become a crown corporation because it feels constrained and cannot operate effectively within the government. It says that it cannot move quickly enough. The parliamentary secretary referred to the fact that because it is operating in a private sector environment maybe it needs to become a crown corporation. I would suggest, if that is the case, that maybe it should just be in the private sector.
My experience with crown corporations since coming here in 1993 is that they can get away with a lot, but I did not realize, and still do not realize, that they can actually move more quickly. I do not think that is the case. I think they are more bureaucratic.
The Reform Party has a problem with crown corporations in general. We believe that the ownership and control of corporations should be placed in the sector that can perform the task most cost effectively, with the greatest accountability to the owners and the least likelihood of incurring public debt. We believe there is overwhelming evidence that this would be the private sector in the vast majority of cases. Therefore, we believe that many of them should be either privatized or go back to the departments which spawned them originally. This particular one wants to spawn out of the Department of Industry and become a crown corporation.
We have seen the privatization of a number of crown corporations in the past, including CN Rail, Air Canada, Petro-Canada and many others. Quite frankly, I do not think that the public has noticed that there is any huge problem with those privatizations. CN Rail used to lose about $2 billion or $3 billion a year on average and was a drain on the public treasury. A crown corporation that contributed to the national debt of some $575 billion that we still have is now doing very well in the private sector. We hear about the merging of two airlines, and they are also making money. PetroCan, no longer constrained by being an agency of government, is also doing a lot of work and doing well at the oil field in Hibernia.
There is no good reason to have crown corporations. They should be converted to private sector institutions or left with the department they are currently in so we would have better accountability to parliament.
We will be opposing this bill. We feel there is no good reason to give the Canadian Tourism Commission crown corporation status.
Recently the Department of Industry issued a paper which supports the rapid divestiture of crown assets. This makes me wonder why the department is sponsoring this bill in the first place. It seems to be in direct contradiction to the way the Department of Industry is going.
I refer listeners to a paper entitled “Canada in the 21st Century—Institutions and Growth—Framework Policy as a Tool of Competitive Advantage for Canada” by Ronald Daniels of the University of Toronto. The author argues that a key component of competitive policy and institutional environment is the minimization of state ownership in a productive sector of the economy. Is that not a direct contradiction to what the government wants to do with this tourism agency by turning it into a crown corporation?
In comparison to other OECD countries, Canada has had historically high levels of state ownership. I know this goes back a few years, but I think it is still very relevant. In 1986 the Economic Council of Canada reported that government-owned and controlled companies accounted for 26% of the net fixed assets of all Canadian corporations in 1983. Yet, these firms accounted for less than 5% of the total employment of the country. That does not say very much for the employment creation capabilities of government-owned companies.
Crown corporations are often unaccountable. My experience since 1993, being the critic for our party for international trade and having to deal with the Export Development Corporation, for example, has not been good. I would suggest they have been basically bad experiences. I feel that accountability is simply not there.
Whenever we try to get information about how taxpayers' money is being spent we get the runaround. It is a vicious circle. If we ask the minister, he says that the entity is at arm's length from him. He is not responsible. If we try to go to the crown corporation, it will plead that the confidentiality of its private or commercial stakeholders will be compromised if specific monetary information is released. Getting information from crown corporations ends up being an exercise in futility. I suggest this would be no different. There is no reason to believe it would be different.
As a division within Industry Canada, the CTC is accountable directly to the minister and the minister is accountable to parliament. That is the way it should be. Either that or the commission should be privatized. It should not become a crown corporation.
I also suspect that the cost of running the CTC as a crown corporation is going to be higher than it is now. The briefing I received suggested that moving the operation to Toronto is a possibility. I can just picture it. Instead of taking up a floor in the C.D. Howe Building at Industry Canada, which is across the street, the commission will need some prominent downtown real estate in Toronto at top dollar.
Salaries will have to go up. To buy a house in Toronto costs twice as much as anywhere else, and then there is the matter of moving and relocating costs for 62 people. It is empire building and it certainly will not be cheap. I am sure the emotional cost to all families involved will also be a problem.
I suggest that empire building is what tends to happen within crown corporations. In my view and in the view of our party we should be getting rid of the few crown corporations that are left rather than adding more.
Tourism is a very important industry. Canada is a spectacular tourist destination and the Reform Party believes that we should promote Canada as a travel destination. Tourism is a big industry for Canada.
A trip through Jasper or Banff national parks in my home province of Alberta in the summertime, or anytime for that matter, is an experience in itself.
They are very busy areas. It is hard to get hotel rooms. People from all over the country want to come to visit the majesty that is ours.
In fact Canada is the 12th largest tourist destination. Last year tourism generated jobs at twice the pace of most Canadian businesses. It also generated $44 billion in revenue for the Canadian economy.
A press release issued by the CTC states that international travel numbers for the first three months of 1999 indicate that this year may well be another record-breaking year for the Canadian tourism industry. Compared with the same period in 1998, international tourists have made 11% more trips to Canada of more than one night's stay.
I suggest that the low Canadian dollar is probably responsible for a big part of that, but we need all the help we can get to balance the service sector because a lot of Canadians also travel outside Canada, especially in the winter months when the snowbirds head to Florida and Arizona. However, I am happy to report that there are a lot of tourists coming to Canada, for whatever reason.
It is clear that Canada needs tourism and that we should market our wonderful country abroad, but it is not clear that we need a crown corporation to carry out that activity. Therefore, my colleagues and I in the Reform Party will be voting against this bill. We will be voting for Canada as a tourist destination. We see no compelling need for a crown corporation.