Debates of April 28th, 1999

Committees Of The House

[Some hon. members]

Nay.

[The Deputy Speaker]

In my opinion the yeas have it.

And more than five members having risen:

[The Deputy Speaker]

Call in the members.

(The House divided on the motion, which was agreed to on the following division:)

Division No. 390

[The Deputy Speaker]

I declare the motion carried.

The House proceeded to the consideration of Bill C-66, an act to amend the National Housing Act and the Canada Mortgage and Housing Corporation Act and to make a consequential amendment to another act, as reported (without amendment) from the committee.

National Housing Act

[The Deputy Speaker]

Order, please. There are 37 motions in amendment standing on the notice paper for the report stage of Bill C-66.

Motions Nos. 3, 26 and 37 are the same as amendments presented and negatived in committee. Accordingly, pursuant to Standing Order 76.1(5) they have not been selected.

The other motions will be grouped for debate as follows:

Group No. 1, Motions Nos. 1, 2, and 4 to 6.

Group No. 2, Motions Nos. 7 to 10, 13 to 24, and 35. Group No. 3, Motions Nos. 11, 12, 25, 27 to 34, and 36.

The voting patterns for the motions within each group are available at the table.

The Chair will remind the House of each pattern at the time of voting.

I shall now propose Motions Nos. 1, 2 and 4 to 6 to the House.

[Werner Schmidt, Reform, Kelowna, BC]

moved:

Motion No. 1

That Bill C-66, in Clause 3, be amended by deleting lines 8 to 12 on page 4.

Motion No. 2

That Bill C-66, in Clause 3, be amended by replacing lines 1 and 2 on page 5 with the following:

“8. (1) The Corporation may insure housing loans.”

Motion No. 4

That Bill C-66, in Clause 3, be amended by replacing lines 8 and 9 on page 7 with the following:

“the obligation.”

Motion No. 5

That Bill C-66, in Clause 3, be amended by replacing line 10 on page 7 with the following:

“18. (1) The Corporation may, subject to regulations made under section 465 of the Insurance Companies Act which regulations shall apply to the Corporation with such modifications as are necessary, obtain reinsur-”

Motion No. 6

That Bill C-66, in Clause 3, be amended by replacing lines 21 to 23 on page 7 with the following:

“this Part by Her agent the Corporation. Any amount so paid constitutesa dividend paid by the Corporation to the Government of Canada.”

Mr. Speaker, it is a pleasure to rise to debate various amendments to Bill C-66 this afternoon. At the end of each of grouping will there be a vote, or will the votes be deferred until all the groups have been heard by the House?

[The Deputy Speaker]

In accordance with the standing orders all votes will be deferred at the end of each group until all have been completed and then all the votes will be held together.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, I would like to address the amendments in Group No. 1 and put a title upon the five amendments that have been accepted by the House. These motions come to grips with the role of the Canada Mortgage and Housing Corporation as a financial institution. What the bill does in many ways is create a new crown corporation.

We all know that the Canada Mortgage and Housing Corporation is actually a crown enterprise corporation, which makes it a little different from other crown corporations. One of its mandates is to be sure it makes money. In other words, it is not designed to take money from the consolidated revenue of the Government of Canada.

The Canada Mortgage and Housing Corporation, through the provisions made by Bill C-66, becomes actually a financial intermediary in the financial marketplace. I ask why a crown corporation should become a financial intermediary in the financial marketplace. We have such institutions as the banks. We have trust companies. We have credit unions. We have insurance companies. We have various kinds of mortgage companies. And here we have a crown corporation which is given the powers under this legislation to borrow money, to lend money, to insure mortgages and things of this sort.

This principle of whether the Canada Mortgage and Housing Corporation should in fact become an institution that intervenes or that it become an intermediary in the financial marketplace is a very real question. I submit that the Canada Mortgage and Housing Corporation was set up to perform a function, and that was to make housing possible for Canadians.

Over the years the purpose of the Canada Mortgage and Housing Corporation, which is there to bring into practice and to implement the provisions of the National Housing Act, was to make housing available to ordinary Canadians who would otherwise not be able to afford to do so. Many, many people, and that includes myself, were able to purchase their first house because of the provisions of the National Housing Act. Millions of Canadians have benefited from this.

The recent amendments that have come into place allowing people to mortgage a house with only a 5% down payment has opened the market tremendously to a large number of people. This is a very commendable thing. Canada Mortgage and Housing Corporation insures the mortgages for the financial institutions.

We can debate for a long time whether in fact the financial institution should be protected to the point where it does not have to worry about the prudence of a particular mortgage. After all, if the mortgage goes down, the bank will never suffer, Canada Mortgage and Housing Corporation will simply pay it off. In one way it is actually a subsidy to the banks and allows them to give money away without incurring any risk on their own.

While I have some difficulty with that, I also know that there are some people who would never ever be able to buy a house unless the mortgages they sign were supported and insured by Canada Mortgage and Housing Corporation. I think that is a wonderful move.

There are some provisions in this bill though that cause me severe difficulty. One of these is the provision that dividends are considered for the purposes of this act to be expenses for the corporation. Any other corporation that pays dividends to its shareholders is not allowed to consider them as expenses. They are indeed a draw on the cash reserves of the company, but they are not expenses. There are other expenses like the payment of rent, utilities, salaries and things of this sort, but this bill allows the Canada Mortgage and Housing Corporation to somehow consider dividends as an expense. I think that is fundamentally wrong.

One of the amendments we are proposing is that these payments, in this case the dividends, would be paid to none other than the consolidated revenue fund, which is really the Government of Canada. Since the Government of Canada is the sole shareholder of Canada Mortgage and Housing Corporation, it in fact is paid these dividends. Those are not expenses. Those are clear outright payments to the Government of Canada.

There are other provisions in this legislation that we have to look at in some detail as well.

The Canada Mortgage and Housing Corporation is able to perform its functions of a financial nature, insurance, reinsurance, borrowing and issuing securities, outside the provisions of the Office of the Superintendent of Financial Institutions.

One of the purposes behind this legislation, we were told, was to make Canada Mortgage and Housing Corporation a more commercial enterprise. The suggestion was that it should compete on a more or less fair and level playing field with other competitors in that particular field.

There are three things that are complicated by the way in which OSFI does not govern or does not in any way have any say about what Canada Mortgage and Housing Corporation does.

The major competitor to Canada Mortgage and Housing Corporation is GE Capital which also insures mortgages. This company with which CMHC competes must abide by the rules of the Office of the Superintendent of Financial Institutions.

Here we have two companies, one a crown corporation and one a private corporation, both performing a function and a service for the people of Canada. The people of Canada can choose one or the other. To that degree it is okay and everything is level, except that the operation of the private company is under a different set of regulations from those of Canada Mortgage and Housing Corporation. It must have certain requirements in terms of reserves and certain ways and places where it can invest money that the Canada Mortgage and Housing does not have.

I ask is it fair and reasonable to expect an honest competitive field to exist between the crown corporation on the one hand and the private enterprise on the other? Both serve the public and the public can choose which one they would work with in terms of insuring their mortgage, but in fact one is at a clear disadvantage to the other one. That is only one area.

The other area is the requirement by the financial institutions, and I have to go back a little bit here. Canada Mortgage and Housing Corporation has 100% backing of its full mortgage. If it issues an insurance policy for a particular mortgage, it is totally 100% guaranteed by the Government of Canada or by Canada Mortgage and Housing Corporation. A financial institution runs absolutely no risk. It will always be able to look to the public treasury. If for some reason Canada Mortgage and Housing Corporation should have difficulty, the consolidated revenue fund is there to back up completely, 100 cents on the dollar, whatever shortfall there might be by Canada Mortgage and Housing Corporation.

Such is not the case with a private insurance company that also insures mortgages. The government as well has an agreement here, which is commendable, where it underwrites up to 90% of the mortgages that are insured by an organization such as GE Capital or any other company that would come on the scene.

That difference of 10% is a pretty significant factor in terms of the particular financial institution that wishes to do business with a company like GE Capital, for example. It now puts GE Capital in the position of having to deposit additional moneys with the financial institution, or the financial institution has on its own right to commit a reserve against this exposure.

I submit that one of the major purposes behind the amendments of the bill is defeated by creating Canada Mortgage and Housing Corporation into a new creature, a financial institution that competes directly in the marketplace and as an intermediary in the financial marketplace.

The amendments that have been proposed by myself in the name of the Reform Party in fact come to grips with rectifying that situation and making it a better piece of legislation. I humbly submit that all members of the House support the amendments that have been proposed.

[Carolyn Parrish, Liberal, Parliamentary Secretary to Minister of Public Works and Government Services]

Mr. Speaker, I am pleased to address the House and the issues raised by the member for Kelowna concerning mortgage insurance in Bill C-66.

I would like to respond at the beginning by asserting that the government is against Motions Nos. 1, 2 and 4 to 6 proposed by the member opposite.

I would like to stress that Bill C-66 supports the Government of Canada's efforts to make government more efficient and provide better service to Canadians. The changes to the mortgage insurance and guarantee legislation put forth by the member for Kelowna would put at risk the benefits Canadian families gain from CMHC's work in housing finance and threaten chances of progress.

Through CMHC's mortgage insurance and mortgage backed securities program, the Government of Canada has important levers to promote housing affordability and choice, to ensure access to mortgage funds as well as competition and efficiency in housing finance, to protect the availability of adequate housing funding at low cost, and to contribute to the well-being of the housing sector in the national economy.

Mortgage loan insurance and mortgage backed securities have been important public policy tools of the Government of Canada, tools which have made it possible for millions of Canadians to realize their dream of owning a home, and this at no cost to the government.

The hon. member for Kelowna would have us throw away the benefits of bringing in more funds from the capital market by limiting mortgage backed securities and proposes uses for mortgage insurance that could stifle our country's ability to improve the availability and affordability of housing.

The new section 3 of the National Housing Act clearly sets out the mandate and limits of CMHC's functions in housing finance:

The purpose of this Act, in relation to financing for housing, is to promote housing affordability and choice, to facilitate access to, and competition and efficiency in the provision of, housing finance, to protect the availability of adequate funding for housing at low cost, and generally to contribute to the well-being of the housing sector in the national economy.

How much clearer can one get? Why would this government give CMHC the uninspired and limited means proposed by the member for Kelowna when its mandate is much more compelling and much more clear? Why would the House regulate CMHC's activities in the same way it oversees privately owned financial institutions when it can govern more directly with the input of Canadians?

The dream of owning a home is one shared by a great many Canadians. Unfortunately, many are unable to buy a house despite the fact they can afford monthly mortgage payments. The reason for this is that many families find it hard to save the money required for the down payment on a conventional loan.

Mortgage loan insurance has provided many Canadians with the opportunity to own their own home. In some cases it allowed them to buy sooner due to the lower down payment. In other cases it opened the door for people who would have otherwise never been able to buy a home.

I would like to give an idea of just how many Canadians depend on mortgage loan insurance in order to fulfil their dream of owning a home. In the past year CMHC has helped Canadians gain access to over 300,000 homes with the use of mortgage loan insurance, and this was done at no cost to the government.

The Government of Canada is committed to ensuring that mortgage insurance is available to homebuyers in all regions of Canada. The proposed amendments would allow CMHC to operate its mortgage insurance program on a more commercial basis. This will ensure that CMHC is able to compete on an equal footing with any private mortgage insurer. This means that all mortgage insurers, both public and private, are subject to the same regulations.

By guaranteeing competition in this sector, we can ensure that Canadians are able to have access to the best possible price and a greater number of choices in home financing products. Besides helping Canadians to become homeowners, CMHC mortgage insurance has also been key to the health of the housing industry in Canada. By fully protecting lenders against default on the part of borrowers, mortgage insurance encourages investment in residential construction. As a result, CMHC plays a central role in creating numerous jobs in this key sector of our economy.

In recent years CMHC has been approached to support many innovative products. With the new National Housing Act, CMHC will be able to bring the benefits of some of these new types of home financing products to the marketplace.

By simplifying the National Housing Act, CMHC would have the flexibility to consider products such as insurance for a reverse equity mortgage to enable older homeowners to use the equity in their home to obtain funds while allowing them to continue to live where they have lived for a long time.

CMHC would also be able to consider such ideas as non-mortgage financing for remote areas where the land registry system does not facilitate mortgages, or financing arrangements on Indian reserves where restrictions exist on providing land as security for mortgages.

Any new products to give Canadians increased opportunities for housing choice and affordability would be developed after careful consideration of their potential success in the marketplace.

The failure to remain competitive could reduce CMHC to a residential insurer with riskier loans. This would jeopardize mortgage insurance, self-financing and create the need for public subsidies.

Passing this legislation would equip CMHC with the necessary financing tools required to continue to provide Canadians with the opportunity to own a house. Bill C-66 will also strengthen CMHC's capacity to accomplish its goal of contributing to the well-being of the housing sector and our nation's economy.

In summary, the new National Housing Act will improve the service CMHC provides to Canadians and support the housing industry. Why would the hon. member for Kelowna want to jeopardize the viability of CMHC's mortgage loan insurance? Mortgage loan insurance is a service that has made a difference to over three million Canadian families since 1954. With Bill C-66, we want to ensure that the benefits governments provided to past generations will continue to be available to Canada's future generations.

Canadians across the country will benefit because of Bill C-66. Consumers will benefit in the area of mortgage financing. The housing industry will benefit through increased promotions of Canadian products and services at home and abroad. Canadians in general will benefit from new jobs created by the housing industry and enhanced service from CMHC.

The mandate of the national housing act is clear: to promote affordability and choice in housing while facilitating access to financial sources and encouraging competition and efficiency in this area. The legislation will ensure that this mandate will continue to guide housing policy implementation and future policy development.

Since its creation more than 50 years ago, CMHC has been involved in every aspect of housing. Its contribution to helping house Canadians is unequalled.

I hope that the members of the committee will support Bill C-66 so that CMHC can continue to make its contribution to improving the quality of life for all Canadians. I appeal to the members of the whole House to vote against the amendments and vote for the bill in its current form.

[The Deputy Speaker]

It is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Halifax West, National Defence; the hon. member for London West, Foreign Affairs; the hon. member for Sackville—Musquodoboit Valley—Eastern Shore, Fisheries and Oceans.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, I am pleased to speak to the proposed amendments. I would first remind those joining us that the subject of the debate is housing. I thank the member for Québec for giving me a hand in difficult circumstances.

It is paradoxical, to say the least, that we have before us a bill such as this one, because it has two major flaws. First, it helps to further privatize the Canada Mortgage and Housing Corporation.

Let me make myself clear. We do not think privatization should be avoided at all cost. We think there is a room in the mortgage market for private enterprise. However, we do not understand the government making it a priority in the area of housing.

We would have been happier if the government had succeeded in the negotiations it began with the provinces. It made a commitment in the throne speech in 1996 to transfer $1.9 billion to the provinces. This is something extremely important to Quebec.

There are a number of Reform amendments to privatize the corporation. What we would like for Quebec, if we must talk privatization, is to have the federal government not run the show and not be involved in housing, because the Government of Quebec is prepared to assume all responsibilities inherent in this area. This includes public housing, land use and, naturally, management of housing inventories.

It is paradoxical, to say the least, that since 1996, negotiations with the Government of Quebec have not been entirely successful. We have introduced more specific amendments in this regard. However, members should know that federal spending on housing in Quebec for 1996-97 amounted to $362 million. This corresponds to roughly 18% of the CHMC's spending.

However, both the PQ government and the government led by Robert Bourassa have admitted that Quebec was not receiving its fair share of housing dollars. Quebec should receive almost 29% of what the CHMC spends on housing, since 29% of those with urgent housing needs live in Quebec.

We would have liked to see the government tackle this problem rather than launch into what is more of an administrative reform. The public should know that the proposed reform is essentially administrative in nature. In fact, its purpose is to give the CHMC more powers and to amend the legislation such that, in many circumstances, the CHMC will be able to take decisions without going through parliament.

Members of the Reform Party, the New Democratic Party and the Progressive Conservative Party should know, and the member for Chambly will agree with me, that we will support any amendment giving parliament a greater decision making role. We feel it is important for parliamentarians to play their role of debating issues, taking decisions and, of course, understanding the decisions made by crown corporations.

With the member for Québec, who is the critic for issues related to poverty, early childhood and the family, present, I would like to take this opportunity to say again that we believe that poverty cannot be eliminated without a housing policy. This conviction is shared by all Bloc Quebecois members.

Why? Because very often the main cause of poverty is, of course, the excessive amount that has to be allocated to rent. At the present time—one cannot predict the future—I know that there is a debate going on, to which the hon. member for Québec has referred, which may lead to a redefinition of poverty. Nevertheless, as we speak, although there is no official index for assessing poverty, the low income cutoff level is one indicator which shows us just how much poverty there is in Canada and Quebec.

The Progressive Conservative Party whip, whose sensitivity on this issue is well known, shares my conviction that we must do something about of poverty. I imagine that the hon. member for Chicoutimi shares my analysis that the government we have in Quebec City is working hard every day to do so, but the same does not go for the federal government. The government in Ottawa is not one particularly concerned with these matters.

I would even go so far as to call it rather heartless, rather indifferent, with a few exceptions. Some of the ministers are less so. I would acknowledge, at any rate, that the Minister responsible for Human Resources Development is sensitive to these matters.

I would ask him to put out a little more effort, because his government, it must be admitted, does not have a very good track record in the matter. I think his sensitivity is real, and with his great intellectual capacity he will certainly make a positive contribution to the debate. However, the policies of his government are pitiful.

Let us take, as an example, the UN's evaluation of the government's policies. The UN was concerned, and members will recognize that the UN has no representation within the parties in this House. They are people who work for various commissions set up under this organization, often they are experts not bound by the imperatives of party life.

In fact, I have a major grievance against the government on this score. Canada is a signatory to the International Covenant on Economic, Social and Cultural Rights, ratified in 1996. Since 1994, we have been waiting for Canada's report, which was tabled only this year.

On a similar matter, when it comes to poverty, we cannot permit such inaction. If parliamentarians had taken the trouble to read the report, as did I, the member for Québec, the member for Chambly and the member for Tobique—Mactaquac, they would have realized that poverty has increased in Canada in the past ten years.

The United Nations focused on this. It appears there is a link with the dismantling of the public sector.

I do not know where the minister was in 1992. Perhaps he was working very successfully with Minister Ryan, perhaps he was an international affairs consultant. The long and the short of it is that he was not in this parliament. The fact is that, since 1992, the Canadian government has not put one red cent into developing social housing. In fact, the government began pulling out of various areas, particularly social housing, under the Progressive Conservatives. Facts are facts. The government began pulling out of such areas as social housing in 1992.

With a few exceptions for RRAP, the Canadian government has not, to all intents and purposes, put one red cent into developing social housing since 1992. This is not good enough.

Two provinces are developing social housing: British Columbia and Quebec. Quebec has invested $43 million. If Quebec were a sovereign nation, we would be far more likely to have a cogent policy specifically directed at housing.

My time is up, but I will be back, by popular demand, for the second group of amendments.

[Michelle Dockrill, NDP, Bras D'Or, NS]

Mr. Speaker, I welcome the opportunity to comment on the amendments to this legislation, Bill C-66, dealing with the mortgage insurance function of the Canada Mortgage and Housing Corporation put forward by my hon. colleague from Kelowna.

As we debate the legislation, it is important to remember the original reason for CMHC's existence. It was at the height of the depression in 1935 that the federal government got involved in housing with the Dominion Housing Act. This involvement continued during the second world war with the Wartime Housing Corporation which was set up to address the housing needs of war workers. The CMHC was created in 1946 to address the housing needs of returning soldiers. The CMHC enabled thousands of Canadians to live in decent, safe, affordable housing by building housing or providing mortgage insurance.

Today, if one believes the government, CMHC's role in making housing affordable for Canadians is no longer required. The Conservatives got CMHC out of building new social housing in 1991. More recently, the Liberal government has tried to download its responsibilities for social housing to the provinces. Now, with this legislation, the role of CMHC in providing mortgage insurance for social housing or to people who may not otherwise be able to buy a house is under attack.

In the past, CMHC has been able to offer insurance on 100% of a mortgage loan for co-operative and non-profit housing. Without this support, there would have been very little co-op or non-profit housing for low and moderate income Canadians built in Canada, according to the Co-operative Housing Federation of Canada.

CMHC programs have also meant that many Canadians who could only dream of buying a house have become homeowners. It has played a particularly important role in areas which may be ignored by private insurers, remote and rural areas and first nations.

Now with this bill, which we in the New Democratic Party feel commercializes CMHC, the role it played in the past, financing the construction of social housing and opening up the possibility of homeownership to Canadians of modest means, may be lost.

In the past, when CMHC suffered a loss in underwriting a mortgage, the federal government absorbed that loss. Under this legislation, CMHC will have to absorb any losses from underwriting itself. Absorbing losses may force CMHC to deny mortgage insurance to high risk applicants such as people with limited means.

How can the government justify reducing the role of CMHC? If all Canadians had access to decent, safe and affordable housing I would see the sense in the bill. If the provinces had sufficient resources to meet the housing needs of Canadians I could accept that there were other governments or agencies that could fill the gap. However, that is not the case.

We have recently seen the government give the responsibility to the Minister of Labour to look into what we feel in the New Democratic Party is a national disaster; that is, homelessness in the country.

The generation entering the workforce today knows it is the first one in decades that will have lower real income than the generation that came before it.

Is the government trying to tell us that people in their twenties will not need the support their parents did? If members of the government are doing that, then I can assure them they will not be believed. Are they telling people trying to find a way to afford to buy their own home that there are agencies other than the CMHC which will offer service to higher risk customers? I would hope the government has more respect for the intelligence of Canadians than to try to suggest that.

The role of the CMHC as a bulwark against recession is also threatened. Currently, because it can underwrite mortgages in poor market conditions without risk, the CMHC can encourage housing development at a point in the market cycle when the market discourages it.

Commercializing CMHC's mortgage insurance will force it to weigh risk according to market cycles. Thus, it will no longer be able to play a valuable counter-recessionary role in the economy.

I realize, and this might explain the attitudes of some of my colleagues, that in relatively prosperous urban areas the loss of the service that the CMHC has been able to provide may not be noticed. However, in many of the communities I represent in Cape Breton, and thousands of similar communities across Canada, it would be a very serious blow. That is why I am disappointed to see the amendments put forward by the member for Kelowna. The amendments the member has moved do nothing to ensure that the CMHC is able to meet the housing needs of all Canadians. What they do is respond to the concerns of GE Capital, a large American owned multinational which is in competition with the CMHC.

When we vote on these amendments the decision we have to make is who comes first, a foreign owned multinational or Canadian families?

My party members know which side they are on. We will be voting against these amendments.

We should be ensuring that the CMHC is able to do what it was set up to do, that is, to work to improve the availability of decent, affordable accommodations for all Canadians. It is not only our responsibility, it is our duty to Canadian families.

[Gilles Bernier, Progressive Conservative, Tobique—Mactaquac, NB]

Madam Speaker, I am pleased to share a few brief thoughts on the group of amendments proposed by the member for Kelowna, for whom I have great respect.

Generally, I do not share the member's concern over the expansion of CMHC's insurance products. As a homeowner I can understand and appreciate the value of being able to buy insurance to protect my mortgage against any wild fluctuations in interest rates.

Yes, the financial institutions will benefit because the loan will be insured. More importantly, homeowners who hold mortgages will be protected against financial hardship. This is no different than any loan insurance. Car insurance, for example, protects the car owner as much or more than the bank that holds the car loan.

Regarding this group of amendments, I would specifically like to zero in on Motion No. 6, which proposes to amend the new section 18 of the National Housing Act. This section authorizes the CMHC to pay fees to the federal government in return for the crown backing of CMHC's loan insurance and guarantee operations. The principle of this change to the act is simple. GE Capital and any other private sector provider of mortgage insurance which may join the industry have to pay fees to have the crown back their insurance products, but the CMHC has not been required to do that. This meant that the CMHC had an unfair cost advantage to provide insurance products over private sector competitors. This provision in the bill changes all of that. Now the CMHC will have to pay fees equivalent to those paid by the private sector. That only makes sense and I agree with the intent of the bill on this matter.

Motion No. 6, if I understand the member for Kelowna correctly, deals with what we should call this payment; whether it should be called a fee or a dividend. I really do not care what the government calls this payment in the end, but I would point out that it is the intention to create a new expense for the corporation, just as the private sector companies have an expense involved in providing their insurance products. Therefore, the payment should be reflected on the government's accounts as such.

The Financial Administration Act recognizes payments to the government from crown corporations that are fees in exchange for services. To be consistent, these payments should be treated as a fee as opposed to a dividend.

If I may speak to this amendment more broadly, what the member is missing in his motion and what the government has missed in this section is the effect this change will have on the books of the corporation.

According to the CMHC corporate plan, between 1997 and 2002 the Canada Mortgage and Housing Corporation will have paid $198 million to the receiver general in fees under this new section of the bill. This money will be paid out of the mortgage insurance fund and put into general government revenues. In other words, this money will be lost to the Canada Mortgage and Housing Corporation forever and cannot be used by the corporation to increase its investment in the social housing portfolio.

Because this money will be dumped into general revenues, it could be used for any scheme the government might cook up. It could be used to redecorate the offices of the public works minister. It could be used to fly the finance minister across the country so that he can speak at fundraising dinners to pad his own leadership campaign fund. It could be put in some government slush fund to dole out grants to companies with devious connections to the Liberal Party, based on the flimsiest of criteria, not that we have ever seen that happen before.

Where the government has missed out and where the member for Kelowna has missed out with his amendment is that neither has addressed the concern about what to do with the money generated by this new fee.

I suggest to the member that we should take that money and put it back into social housing under the minister's account. This money will be generated by the commercial activities of the Canada Mortgage and Housing Corporation and should remain with the Canada Mortgage and Housing Corporation.

As I stated earlier, I agree that there must be a fee paid in order to put the Canada Mortgage and Housing Corporation on a level playing field with its private sector competitors. However, having said that, there is an opportunity here, which I am sure the hon. member will recognize, to put that money to good use.

The member proposed in his amendment that this payment be called a dividend. I say, let us give a dividend to the 1.2 million Canadians who lack affordable and adequate housing. Let us give a dividend to the tens of thousands of Canadians who are homeless in this country. To make this happen, all the government has to do is make a policy change in cabinet to return this money to the minister's account at the Canada Mortgage and Housing Corporation so that we can increase and fund the supply of affordable housing for all Canadians.

I know that $198 million does not go as far as it used to when it comes to housing, but if the government is truly determined to make a dent in the problem of homelessness in this country, this would be a good place to start. I am sure the member for Kelowna would agree with me.

[Ghislain Lebel, Bloc, Chambly, QC]

Madam Speaker, I listened to the comments of my colleague, the member for Hochelaga—Maisonneuve, and it was music to my ears.

The member for Hochelaga—Maisonneuve has consistently demonstrated his concern with poverty, an issue to which ministers of the party in power have been completely and totally insensitive for a good long while. One example of this is the EI reform, which has left many in abject poverty. The minister responsible for this aspect of the legislation and for government management is unbelievably insensitive to the straits people are in.

Because of the misery that he is causing, his fellow minister sitting just two seats from him has a poverty problem on his hands, given that he has to provide housing for these poor people. Every human being must, at a minimum, have a roof over his head.

The minister responsible for the National Housing Act and the Canada Mortgage and Housing Corporation Act is faced with responsibilities that he may not have anticipated. He did not expect it would turn out this way.

In Montreal alone, 500,000 people are living below the poverty line. The number may actually be higher, because I am quoting a figure that is at least a few months old already.

I am trying to figure out the Canada Mortgage and Housing Corporation. I heard the parliamentary secretary praise the CMHC earlier. I a, familiar with this corporation, since I used to work in the real estate sector. As I mentioned in a previous speech, the Canada Mortgage and Housing Corporation met the expectations that people had when it was first created, at the end of World War II, when Canadian troops back from the front were settling massively in cities. They settled in cities upon their return from Europe. People were leaving rural areas to settle in Montreal, Toronto or elsewhere. The CMHC was responding to a need.

Today, that need still exists. I am thinking of my young daughter who wants to buy a house—in fact she will do so next week—and would really have appreciated benefiting from the legislation, in the sense that, right now, the initial or minimal downpayment to buy a house is 10% of the total price. It used to be 5%. The minimum down payment has been changed to 10%. There are strings attached; CMHC does no one any favours. It charges for the services it provides and the guarantees it gives.

I have been asked to comment on this matter. When someone borrows $100,000 from a bank, CMHC tells the bank “If the borrower does not make his payments to you, then we will”.

For this service, a certain amount is charged, according to the size of the loan. Often the amount charged by CMHC for its services is greater than the minimum down payment required to purchase the property, in absolute terms.

This is rather odd. They get involved because the borrower does not have a lot of money, and then they hit him with higher charges than the amount required for the down payment in order to have a secured loan.

There is something unclear about this, something that is hard to understand, a question to which no one has given any answers, particularly not the minister sponsoring this bill.

The CMHC makes loans. The risk it assumes is estimated at 5%. In the past, I have seen CHMC repossess properties and lose its shirt. Loans have been made on which the payments have not been kept up, and then the lending institution, the bank or caisse populaire, tells CMHC “Give us our money, and take back the house”. So CMHC repossesses it and sells it for a fraction of the value it had guaranteed.

All this because the CMHC, for a long time now and for reasons of economy, no longer evaluates houses or the risk it is taking. It goes by statistics. They can often be very precise. However, it is a good idea to at least superficially look at the risk being taken, so that the fees charged those who have no other way of obtaining housing are reduced because the CMHC is taking fewer risks. Everyone would be delighted, and those who turn to the CMHC would be the first to benefit.

However, the minister prefers to act on statistics, even if they are not always true. If we take as an example a country where the population averages three feet tall and another where the population averages seven feet, I, who make suits for people five feet tall, would have no clients. It is a bit like that. The statistics and the standards sometimes mislead us.

I wanted to take this opportunity in my speech to remind the minister that, even if he is hiding behind statistical arguments—a lot of things can be proven with statistics—but in truth, he can cause hardship and move the CMHC away from its prime objective, which is to provide access to property, but not just any property, decent property.

There is also a danger in this bill, which I cannot let pass, and that is regulation. The bill says that the governor in council may make, amend, add or remove regulations at any time. It does not say “by order”, meaning after consulting with parliament or cabinet. In other words, without consulting anyone about government policy, the minister will now be able to publish regulations in Part II of the Canada Gazette , obviously in the interests of speed.

When I co-chaired the Standing Committee on the Scrutiny of Regulations, this was the argument used by departments. They thumbed their noses at democracy as it were, but said it was in the interests of speed and efficiency. There is no denying that democracy always costs a little bit more. It is easier not to have to be accountable, not to have to justify an action or a position, and to do as one pleases.

But members of the public are already paying so much in taxes that, when all is said and done, they are entitled to a minimum of respect. They are entitled to be informed that regulations will be amended, that the rules of the game will change and that things will be different. In this case, however, regulations will not be published anywhere but in the Canada Gazette . Often, they will be published after they have taken effect. That is even worse, and often happens.

In conclusion, I wish to applaud the efforts of the member for Hochelaga—Maisonneuve, and those of the New Democratic Party member for Bras d'Or—Cape Breton, who participated in the debate on this bill to try and make it more humane and sensitive to poverty, unlike the Reform Party members, who saw it as an opportunity to reward private enterprise, which is in competition with the CHMC, and as a good business opportunity.

[John Cummins, Reform, Delta—South Richmond, BC]

Madam Speaker, I am pleased to rise today to contribute to the debate on Bill C-66, an act to amend the National Housing Act and the Canada Mortgage and Housing Corporation Act.

The general purpose of the bill appears to be to place the CMHC on a more commercial footing, particularly in terms of its mortgage insurance business. That in itself is certainly a commendable objective but, as we will see, there are certain problems with it.

As with much that has gone on in the House during the current parliamentary session, the significance of the legislation will likely be noticed by few in the media or the public. It so happens that the bill involves the most extensive changes in nearly 15 years, since 1985, to the National Housing Act and to the Canada Mortgage and Housing Act.

It was in the 1980s, as pointed out by my hon. colleague from Kelowna during his speech on second reading, that CMHC accorded greater priority to social housing needs. The position of the government is that these legislative changes are in keeping with the enhanced role of CMHC in facilitating home ownership, even though it is a crown corporation as an agent of government with respect to social housing concerns. For example, the government has made CMHC a missionary to the homeless through adding $50 million to the CMHC's home renovation program.

Some see a contradiction with the federal government bent on downloading responsibilities for social housing to the provinces at the same time as favouring an enhanced social role for CMHC. Others believe that the very existence of the CMHC illustrates an all too familiar pattern of federal government encroachment on areas of provincial jurisdiction, doing so either directly, under the guise of an issue being of national concern, or indirectly through the use of federal spending powers, in this case federal spending powers to facilitate home ownership with 5% down.

With regard to social housing the CMHC has played a pivotal role with respect to the expansion of co-operative housing. It is through the CMHC that mortgage interest subsidies are provided to these housing co-operatives. Some people argue that it is not equitable to provide mortgage interest subsidies based solely on the fact that a building is collectively owned by a non-profit corporation.

The profit to those living collectively in a supposed non-profit context is the shield from interest rate fluctuations which CMHC provides. In the longer term the profit to those living collectively is a mortgage free environment with the mortgage having been rapidly paid off due to taxpayer subsidies.

People living in non-profit housing co-ops never acquire any equity in the property though they acquire equity in other ways, some argue, based on taxpayer generosity with respect to the co-op mortgages. Some people question why several individuals cannot simply go to a financial institution and ask for financing through a collectively signed mortgage or by way of pooled funds and individual mortgages. To what extent should people who wish to live collectively be treated any differently in terms of government housing assistance than those who purchase homes individually?

Much of the debate on the bill has so far concerned whether it is appropriate for the CMHC to be competing with other financial institutions and whether expanded quasi-privatization of the CMHC is of general economic benefit.

In my riding there is a significant co-operative housing component. In addition, with respect to social housing, generally my hon. colleague from Kelowna mentioned during his second reading speech that as of 1992 an amendment to the British Columbia municipal act requires that municipalities include housing policies in their official community plan.

It may be said that in British Columbia social housing issues were being addressed far earlier than before they became politically fashionable in other provinces or even in the House.

I note that pursuant to the bill CMHC will be able to provide interest rate relief. However, such relief is regarded as only applicable to individual borrowers due to the competing provisions in the Interest Act. Many people understand that they can generally get out of an onerous mortgage interest rate by paying a three month penalty. These provisions are designed to protect consumers who may not appreciate interest rate fluctuations to the same extent as corporate borrowers.

Corporate borrowers generally are stuck with the mortgage interest rates they initially agreed to. This obviously causes problems with long term high interest rate debt in circumstances where, as now, mortgage interest rates have been low for quite some time. One sector that is disadvantaged in this respect is the co-operative housing sector. Many housing co-operatives are tied to high interest rate, long term mortgage obligations.

They would prefer to be able to pay an interest rate penalty and to refinance. Their mortgage lenders would obviously prefer otherwise. The taxpayer through CMHC would appear to end up paying a higher interest rate subsidy to housing co-operatives than would otherwise be the case if they could refinance their mortgages at current rates.

In the same way people choosing to live collectively perhaps should not be accorded greater government housing assistance than those who prefer to purchase housing individually. People who choose to live collectively should not be treated any differently from individual purchasers in terms of mortgage prepayment privileges.

My point is that whatever one thinks of financial institutions, housing co-operative borrowers are really no different from individual borrowers in terms of sophistication and social need. Therefore I want to use this opportunity to put on the Hansard record my concern that mortgage prepayment privileges be made available to housing co-operatives.

I know that the government has been lobbied on this issue but has yet to see fit to act. Quite apart from this being the right direction to take, it cannot prejudice the government's relationship with the financial institution sector any more than the government has already managed to do.

Another issue I would like to address has to do with an issue that was raised by Ms. Janice O'Brien, executive director of the B.C. Association of the Appraisal Institute of Canada, who noted:

These amendments are designed to allow Canada Mortgage and Housing Corporation—to operate in a commercial manner. The Appraisal Institute's experience shows that they raise serious public policy issues.

In particular, the Appraisal Institute of Canada noted:

Bill C-66, amendments to the National Housing Act—is designed to allow Canada Mortgage and Housing Corporation—to operate its mortgage insurance business “on a more commercial basis”. However, as long as CMHC is a crown corporation, parliament has responsibilities to act as a watchdog.

The Appraisal Institute of Canada asks members of parliament to examine Bill C-66 to ensure that it doesn't provide CMHC with a licence to operate in a more commercial manner by compromising or sacrificing its responsibilities for public federal housing policy.

The concern is that we do not repeat the mistakes that were made in the U.S. While CMHC moves away from appraisals, federal housing officials in the United States are strengthening appraisal requirements for all federal mortgage insurance.

Computerized underwriting is not replacing appraisals. Instead aggressive new consumer oriented standards are being prepared for all federal mortgage insurance appraisals. U.S. appraisals would be required to provide more detailed disclosures to the consumer about the condition of an appraised property. The U.S. experience by itself suggests the need to review CMHC's current practices.

As with opposition to any legislation, the fact that parts of a bill are objected to and the bill voted against does not mean that one is opposed to the direction of the bill.

The official opposition supports the principle that Canadians should have access to affordable housing in order to acquire housing and recognizes the role that public mortgage insurance plays in supporting it. However, in keeping with the general view of the official opposition that private sector options should be explored, it is suggested that greater private sector competition in the provision of mortgage insurance should be encouraged.

What the legislation does is further entrench government intervention in the housing market, an area of provincial and municipal jurisdiction. The prejudicial impact on existing financial institutions is largely unknown.

For these reasons, among others, the official opposition will oppose the legislation in its current form but nonetheless remain pleased to have had an opportunity to place the concerns of Canada housing co-operatives, which I fully support, on the record.

[The Deputy Speaker]

Order, please. It being 5.30 p.m., the House will now proceed to the consideration of Private Members' Business as listed on today's order paper.

[Marlene Catterall, Liberal, Ottawa West—Nepean, ON]

Mr. Speaker, I rise on a point of order. There have been discussions and I understand you would find unanimous consent for the House to deal at this time with Bill S-25 at second reading, in committee of the whole, at report stage and at third reading, without debate and with any time consumed by this bill being added on to this private members' hour. For the information of the House, Bill S-25 is essentially a housekeeping bill. It modernizes existing legislation to provide the certified general accountants—

[The Deputy Speaker]

Order, please. Perhaps the hon. member could explain the purpose of the bill at second reading if we get consent to proceed with it.

Does the House give its consent to proceed as outlined by the deputy government whip?

[Some hon. members]

Agreed.

Association's Act

[Marlene Catterall, Liberal, Ottawa West—Nepean, ON]

moved that Bill S-25, an act respecting the Certified General Accountants Association of Canada, be read the second time and referred to committee of the whole.

Mr. Speaker, as I said, this is essentially a housekeeping bill. It modernizes existing legislation with respect to the Certified General Accountants Association of Canada, to provide the association with a French name, Association des comptables généraux accrédités du Canada, and with an officially recognized short form name CGA-Canada. It clarifies the definition of the association's activities and powers to make the legislation fit the reality of the organization in its current form.

[Lorne Nystrom, NDP, Qu'Appelle, SK]

Mr. Speaker, we of course agree that there is unanimous consent for this. It is a bill that is routine in terms of being accepted by all parties of the House.

However, I did want to register, on behalf of my party, an objection to the fact that this originated in the Senate. This appears to happen more and more often with this government. It is not elected, it is not accountable and it is not democratic. The bill should originate in the elected House of Commons representing the people of Canada. I am sure the member for Sarnia—Lambton would agree with that.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, as a member of the Certified General Accountants Association, I am pleased to see this bill receiving unanimous consent to move through the House quickly. It is a housekeeping bill, as the deputy whip of the government said, and I am glad to see it proceeding quickly.

(Motion agreed to, bill read the second time, considered in committee, reported, concurred in, read the third time and passed)

Heroin Prescription Trials

[Libby Davies, NDP, Vancouver East, BC]

moved:

That, in the opinion of this House, the government should, in co-operation with the provinces, implement clinical, multi-centre heroin prescription trials for injection to opiate users, including protocols for rigorous scientific assessment and evaluation.

Mr. Speaker, I am very pleased to rise in the House today to debate my private member's Motion No. 454. I would like to spend a few minutes detailing why the issue is very important not just to my constituents but to people across Canada.

When I was first elected in the riding of Vancouver East in 1997, the first event I attended, before I actually arrived in the House of Commons, was a very tragic community gathering in Oppenheimer Park. The neighbourhood people, who were very concerned about the number of deaths from drug overdoses, had gathered to put up 1,000 crosses in the small park in the middle of this very low income community on the east side of downtown Vancouver. The 1,000 crosses were put up to represent the very tragic lives and deaths of people who had died from drug overdoses.

I have the sad duty to report that in British Columbia the leading cause of death now for men and women between the ages of 30 and 44 is actually from drug overdoses. In fact, in 1998 the number of people who died from drug overdoses was 371, which is an astounding number when one thinks about it.

I thought a lot about this issue and about what we needed to do to come to grips with a very serious health problem. Our local Vancouver-Richmond Health Board was so concerned about the issue of HIV, AIDS and hepatitis C infection among injection drug users that in October 1997 it actually declared a state of health emergency in the community on the downtown east side. This has caused me to bring the issue forward to the House of Commons.

I met with the Minister of Health on several occasions and have raised this previously in the House. I wanted to bring this motion forward to draw attention to the tragedy of what takes place in too many communities in Canada where, because we have had an emphasis on the criminalization of illicit drug use, we have seen many people become further marginalized in society.

The purpose in bringing this motion forward today is to have a debate in the House of Commons on the importance of what is called a harm reduction approach when it comes to drugs. The purpose of Motion No. 454 is to reduce the harm associated with obtaining drugs on the street. The purpose of the motion is to look at how we can protect the community, reduce crime and also save lives because too many people are dying.

In bringing forward this motion, I really wanted to make it clear that the motion simply states that a medical approach to heroin maintenance is one alternative that should be explored. The motion is clearly not about the legalization of drugs or heroin. The motion does not encourage condoning heroin use. It is aimed toward facilitating the research needed to implement an effective alternative regulated treatment option for heroin addicts.

The research I have done has led me to the conclusion that we need to have health intervention. We need to focus on harm reduction. We need to have a medicalization of addiction that allows us as a society to say that the answer is not just to throw people in jail or to criminalize them. We need to provide support, treatment, education and, in some instances, help to people who are facing a chronic addiction because treatment may have failed.

We are now learning from other models, particularly in Europe, where they have been very successful in enrolling volunteers, hard core addicts, who become part of a heroin maintenance program. It is a very well controlled, scientific program which has actually reduced the amount of criminal activity taking place. It has actually reduced the amount of activity that takes place in terms of buying drugs on the black market. It has improved peoples' health status. In some cases, it has allowed people to go back to work, find jobs, be in better housing and basically put their lives together.

This motion is about opening up a debate and saying that our approach to illicit drug laws in the past has been based on views that do not make sense today. If we are really serious about saving lives, protecting the community and reducing the crime that comes about as a result of obtaining drugs on the street, then we need this kind of medical intervention.

There is no question that there is a growing number of health care professionals, people in the justice system and recently the Canadian Association of Chiefs of Police, who have been calling for the decriminalization of small amounts of illicit drugs, and for better treatment, better support and better education. The list is growing of people who recognize that the approaches we have had in the past simply are not working.

I would like to detail some of the support that is out there. The most notable one is the Canadian Medical Association. At its board meeting last December 1998, it passed the following resolution:

The CMA recommends to the federal Minister of Health that the investigation of prescription of heroin for opiate-dependent individuals follow the same approval protocol in practice for the use of any therapeutic drug in Canada; and that the CMA recommend that methadone maintenance and counselling programs be more widely available across the country with appropriate education and remuneration of professional delivering such programs. This recommendation applies also to correctional institutions.

That is from the Canadian Medical Association.

The former B.C. provincial health officer, Mr. Millar, in his 1998 report “HIV, Hepatitis and Injection Drug Use in British Columbia—Pay Now or Pay Later”, also recommended that controlled legal availability of heroin, in a tightly controlled system of medical prescription, should be pilot tested as an option, as part of a comprehensive harm reduction program.

In 1997 there was a federally funded national task force on HIV, AIDS and injection drug use. It included representatives from the Canadian Association of Chiefs of Police, the Canadian Bar Association and the Canadian AIDS Society, among others. The task force recommended a continuum of treatment options and also called on the federal government to conduct clinical trials of prescription morphine, heroin and cocaine as alternative approaches, such as is being done in other countries.

Even a high ranking Health Canada official, Mr. Rowsell of the Bureau of Drug Surveillance of Health Canada, has been reported in the media as saying:

—an initiative to gather evidence looking at the benefits and risks of heroin maintenance will be helpful.

The list goes on. We had a chief coroner's report in 1994 in B.C. that came to the same conclusion. The Canadian Psychiatric Association has encouraged Health Canada and the government to look in this direction. The Canadian Addiction Research Foundation is on the list.

Organizations around the world are beginning to recognize that this kind of approach is something that will produce an overall benefit, not just in terms of individual users who are leading very desperate lives and are very marginalized, but in terms of the benefit to the community and to society as a whole.

This is a controversial issue. I have had people come up to me and say “You are just talking about legalizing drugs”, or “This is something that we could not do”. I believe that if the federal government and the Minister of Health were committed to working with some of these organizations, like the Canadian Medical Association, then we could set up the appropriate protocols that are actually being developed by the Canadian Addiction Research Foundation in consultation with other professionals and scientists. The protocols are now being developed, but it requires leadership from the health minister and from the Canadian government in co-operation with the provinces to say that this is a pilot program.

The notion of multi-centre clinical trials for a heroin maintenance program is something which we should set up as there would be a great benefit. We can learn from other countries which have already done this. We would not be carving out new ground.

Information from the Swiss program, for example, has told us that when nationwide heroin trials were implemented in 1994 there was overwhelming support for the program. Criminal offences and the number of criminal offenders dropped 60%. The percentage of income from illegal and semi-legal activities fell from 69% to 10%. Illegal heroin and cocaine use declined dramatically. Stable employment increased from 14% to 32%. The physical health of people dramatically improved and most participants greatly reduced their contact with the drug scene.

By making contact with people who are marginalized, who are living on the edge of society because we force them to do so by our laws, we can bring them into an appropriate model of health care, into an appropriate setting for social support, for housing and for counselling. People can then begin to put together the pieces and make choices in their lives.

I have been very honoured in my riding to meet quite frequently with drug users. Perhaps not many members of parliament have been able to do that. These individuals have their own organization in the downtown east side called the Vancouver Area Network of Drug Users, or VANDU. These people are trying to assert their own rights. They are trying to find their own voice to tell those of us in positions of responsibility and authority that they matter. Their lives matter. Because they have such difficulty in accessing the health care system, many of them live in slum housing, inappropriate housing, and most of them do not have access to adequate and proper services.

The injection drug users are calling on us to take responsible action. They have done a huge amount of very important work in my community in bringing forward to our local health board and to other bodies the fact that they have rights and that, in many ways, the health care system has failed them.

This issue generates a lot of debate. It deals with our mindset around illicit drugs. However, my interest is to bring forward the desperation and the urgency that exists, not just in my community in the downtown east side, but in many urban centres. People are dying on the streets from drug overdoses because they cannot get the help they need, the housing they need or the medical support they need.

We have a responsibility to look at this issue seriously. I encourage members of the House to be supportive of modernizing and updating Canada's drug laws. I encourage members to promote harm reduction strategies. I encourage members to continue that work and to impress upon the Minister of Health that we will support any initiative he takes to bring this forward. The minister will have support from the medical community. He will have support from the association of Canadian police chiefs and he will have support from the coroners who see the bodies that come in as a result of drug overdoses.

There comes a time when we have to have the courage to stand and say that we have to have change, that what we have done in the past is not working, and that we need a new approach.

I ask members of the House to look at the evidence. Look at what happened in Switzerland. Look at what happened in Europe. Look at our communities and see the people who are suffering and consider this motion as a way of bringing forward a program that will save lives, protect the community and deal with this very urgent health matter.

[Elinor Caplan, Liberal, Parliamentary Secretary to Minister of Health]

Mr. Speaker, the devastation of heroin addiction is of great concern to the government. We want to ensure the health and safety of all Canadians. It is our goal to prevent and eliminate the suffering that heroin addiction causes to individuals, to their families and to their communities.

Heroin addiction, however, is not straightforward. It is a serious and complex issue. Accordingly, the treatment of this terrible addiction requires a thoughtful, considered and sophisticated approach.

The motion put forward by the hon. member for Vancouver East, while well intended, would make clinical trials of using heroin to treat heroin addiction a priority. The success of such treatment is not well established and would not only be controversial, it would have uncertain outcomes. Before any risky clinical trials are embarked upon, all alternative treatments of heroin addiction should be given thorough and due consideration.

Simply put, I believe we need to walk before we run. That is because a number of alternatives for the treatment of heroin addiction are already in existence and are proven to work. I strongly believe that rather than chasing after risky treatments, our time, efforts and resources would be put to much better effect pursuing viable, well-established strategies.

That is why Health Canada is a strong advocate of increasing access to existing successful treatments, in particular methadone maintenance, as well as supplementing medical treatment with counselling and social support programs. Methadone maintenance is the most effective, proven and well established treatment for those who suffer heroin addiction.

Under Canada's drug strategy, any treatment or rehabilitation program must address all underlying factors associated with substance abuse. It must also meet the needs of drug users, many of whom unfortunately use more than one drug at a time. Any treatment that is chosen should strive to meet the basic principles, and methadone maintenance does that. Canada's drug strategy endorses its use to combat opioid dependence.

While on methadone addicts are able to improve their lifestyles, social health, functioning and productivity. Many are able to recover and continue with their lives, such as living with families, completing education or training and remaining employed.

It is Canada's stated priority to increase access to methadone maintenance. To this end Health Canada has streamlined the authorization program and the authorization process, allowing doctors to treat patients quickly and more effectively. The number of physicians using methadone in the treatment of their patients has also increased in this country. Furthermore, the department has undertaken consultation with stakeholders to find ways of increasing access to methadone treatment programs, and we are continuing to do so.

As mandated in Canada's drug strategy, Health Canada is continually working to improve the effectiveness of and the accessibility to an array of safe and proven substance abuse interventions.

It is also true that methadone cannot help all of those who suffer from heroin addiction. However, there are even more alternatives, with equal promise, to methadone that are already in existence. I am speaking specifically of buprenorphine, levo- alpha-acetylmethadol, better known as LAAM, and naltrexone. These alternatives could bring greater flexibility in combating this terrible and costly epidemic, especially to those patients who do not tolerate or do not respond to methadone.

Clinical trials in other countries which were referred to by the member opposite, particularly in the United States and Australia, have shown these other medications to be safe and effective. In addition, there is a ready, safe and secure supply of these other alternatives.

Let us also remember that medical treatment alone is not enough to fight drugs. Canada's drug strategy states that we must consider the determinants of health and address the underlying factors associated with substance abuse.

Many addicts feel a sense of hopelessness and helplessness that is not solely attributable to their habits. This is usually just a symptom of many of the larger issues they are dealing with, such as other health problems, poverty, lack of housing, poor education or a history of abuse.

Governments need to devote significant resources and energies toward providing greater and earlier access to conventional addiction counselling and social support programs, professional psychotherapy, education, vocational training and residential care. The delivery of these health services is the responsibility of the provinces.

This government sympathizes with the many Canadians caught in the trap of heroin addiction. We want to reduce the toll of this terrible affliction. We want to reduce the toll that it takes on individuals and on all Canadians. It is clear that the best and most effective route is to pursue existing treatments that are known to work. As I have said, Health Canada wants to expand access to well-established and proven treatments like methadone, as well as giving a chance to the newer treatments which I mentioned, LAAM and others. It is the course of action that we believe makes the most sense in terms of time, cost, resources, effectiveness and, most importantly, safety for the patient and for society.

Our goal is to prevent the harm this terrible addiction causes; the harm it causes to individuals, their families and our communities. While the member's proposal is well intended, we do not believe it is supportable at this time.