Debates of May 8th, 2000

Cape Breton Development Corporation Divestiture Authorization And Dissolution Act

[Some hon. members]

Yea.

[The Acting Speaker (Ms. Thibeault)]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker (Ms. Thibeault)]

In my opinion the nays have it.

And more than five members having risen:

[The Acting Speaker (Ms. Thibeault)]

Call in the members.

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

Division No. 1280

[The Speaker]

I declare the motion agreed to.

The House resumed from February 16 consideration of the motion that Bill C-11, an act to authorize the divestiture of the assets of, and to dissolve, the Cape Breton Development Corporation, to amend the Cape Breton Development Corporation Act and to make consequential amendments to other Acts, be read the second time and referred to a committee, and of the amendment.

[Pierre De Savoye, Bloc, Portneuf, QC]

Madam Speaker, it is with some sadness that I address Bill C-11, an act to authorize the divestiture of the assets of, and to dissolve, the Cape Breton Development Corporation, to amend the Cape Breton Development Corporation Act and to make consequential amendments to other Acts.

I will explain why I feel this sadness. On January 28, 1999, the federal Minister of Natural Resources announced the closure of the Phalen coal mine and the privatization of the Prince mine, both located on Nova Scotia's Cape Breton Island and managed by a crown corporation, Devco.

At the time, close to 1,700 miners were working for the crown corporation. About 1,000 people find themselves out of work, in a region where unemployment is already at 25%.

At the same time, the minister announced $110 million in assistance to be used for severance pay and early retirement programs for the miners, as well as $68 million for economic development in the region. The Government of Nova Scotia announced in the fall that it would be investing $12 million in the long term economic development of Cape Breton.

It is important to understand that Devco workers are not pleased with the severance package and with the proposed payments. For well over a year now, since February 1999, they have been making representations to the federal government, asking it to reconsider its decisions and to improve its proposals.

In fact, on December 23, a committee made up of representatives from all parties in the legislative House of Assembly of Nova Scotia called on the federal government to improve its offers and increase the amounts proposed to workers.

One million dollars is a lot of money, but when 1,000 people find themselves without work, one million divided by 1,000 is only $1,000 each. This will not pay the grocery bill for very long, or the rent, and it will not put clothes on children's backs for very long either; $1,000 will be gone very quickly. These 1,000 employees are going to end up on social assistance fairly quickly.

They are being offered more than $1,000, but nothing that will really keep them going for much more than a year. These families will be in a very shaky situation.

I would like to depart from my prepared text and share with the House the conversations I had with those representing workers at the time last year when I myself was the Bloc Quebecois' natural resources critic.

I had occasion to meet with mothers who had travelled here to Ottawa to make parliamentarians aware of the fate in store for their husbands, their partners or their sons if the Devco mine were to close. Let us look at the broader picture.

The Devco mine is basically a coal mine. Coal is less popular than it used to be. It is a fairly polluting substance. Therefore, planning to shut down a coal mine, when coal is less in demand internationally, for the reasons I have just given, is not, in itself, illogical. The problem is the approach being taken.

For some time now, the Devco mine has been run for the federal government. When we are dealing with a region like Cape Breton and more than 1,000 people who are going to lose their jobs, this is catastrophic in a community where there are not many employment alternatives. In short, the federal government is, with its good intentions of terminating operations for the extraction of a raw material, coal, no longer in fashion in the world market, committing the huge mistake of penalizing a region, with catastrophic results.

Quite simply, once the people have exhausted their benefits, their separation payments, the outcome will be despair and a complete lack of job opportunities.

They will then have two choices: taking their families and settling elsewhere in Canada, in order to make a living, or remaining where they are, in most cases dependent on welfare.

By using this bill to close the mine under the present circumstances, the federal government is, to all intents and purposes, thrusting a region of Nova Scotia into a disastrous economic situation, one that will be very long term. This is not something that will be remedied in six months or a year. It will take decades to be rectified, if ever, because its very clear consequences will be an exodus of families and increased poverty in this region.

I mentioned earlier, I had the opportunity to meet the wives of the miners and mine workers who are unemployed. The problem could probably have been lessened in various ways, and the unions made proposals—and it was not just the unions that made proposals—that, for the most part, meant that many of the 1,000 workers could have faster access to their pension.

There were a number of ways to go about it. The pensions could have been beefed up for those close to retirement, within two or three years of it—and there were several hundred of them—other workers could have been kept on working in the mine, while the facilities were being shut down. From what I understand, the facilities will be closed by an outside corporation, that may perhaps hire these people for a short while, but will not contribute to the pension fund they have already accumulated.

In short, there were solutions. They could really not have cost more in the medium term. They could definitely cost less in the long term. The government thinks it is only in the very short term that savings will be made, and making a saving in human terms in the very short term is really wasting human capital and thus wasting resources in the medium and long term. This is exactly the situation we are in with Bill C-11, to close the Devco mine.

I do not know how the House could influence the minister to change his decision. I have the impression that things are cast in stone. It is really with great regret and sadness that I realize that the representations made by the people of Cape Breton who came to explain the situation, by the union representatives and by the members of the House, have not had the results we had hoped for.

Again, the short term saving made by the government will be replaced by waste and numerous expenditures in the medium and long terms, particularly for the Province of Nova Scotia, which will have to support, through social assistance, families that will find themselves in a precarious situation.

The Bloc Quebecois does not like this situation. The Bloc Quebecois has a heart and it wants the government to also have a heart. I will conclude by expressing my sympathy and wishing the best of luck to those brave Devco workers, who, unfortunately, are being mistreated by the Liberal federal government, which has no heart.

[Peter Mancini, NDP, Sydney—Victoria, NS]

Madam Speaker, I commend the hon. member for his comments and I thank his party for the positions it has put forward on behalf of the working people in Cape Breton. It is one of the few friends, other than the New Democratic Party, that the working people in Cape Breton have found to voice their concerns in this debate.

I have a couple of questions for the member. First, he talked about money. The government of course will say it is offering $111 million as an incentive package for the miners who are leaving. I point out that in 1996 our gross domestic product was $820 billion, and it is more today. While $111 million may sound like a great deal, in relative terms it is not.

I also point out that the government will say it has offered $68 million to Cape Breton for future economic development. I point out that the Minister of Canadian Heritage recently announced $48 million to build the war heritage museum here in Ottawa. For the entire island of Cape Breton and its future economic growth, we get the value of about one building in Ottawa.

More important though, I would ask the member to comment on the following. This is not the first time crown corporations have been shut down by the government. In each and every case there were benefits offered to those employees as the government extracted itself from whatever industry it was.

There are a number of areas we could compare, but let us just take health care benefits. These people are miners for the most part. They have gone underground. They have suffered injuries. Let me just cite some comparisons.

When VIA Rail was shut down, the employees of the crown corporation not entitled to retirement benefits were eligible for 100% pension contributions and full health benefits packages for five years.

When CN was shut down, the employees were entitled to group benefits and life insurance for a maximum of two years and the company paid the full cost.

When AECL was shut down, there was an extension of benefit packages with Blue Cross for health, dental and life insurance costs which were covered by the company.

When Devco shuts down, which the government says is justified, the employees who suffer from a number of ailments because of the kind of career and work they did, there are no provisions in this government package for extensions of health, dental or life insurance benefits. Those who have sick children, those who suffer from illnesses that they received in the mines, those who suffer from lung cancer, those who suffer from black lung will not be afforded the rights that were afforded other employees of crown corporations when the government withdrew from those corporations. That is just in health benefits. I could go on and compare others. I would be interested to hear the member's comments on those issues.

[Pierre De Savoye, Bloc, Portneuf, QC]

Madam Speaker, the hon. member just mentioned a number of very real consequences relating to health. Indeed, this is what I pointed out earlier in my speech.

There seems to be a will to save federal dollars in the short term. Incidentally, these dollars come from the taxpayers' pockets. There is no Santa Claus in Ottawa that prints money. These dollars come from the pockets of those who pay taxes.

The government wants to save that money, but in 12, 24, 36 months and more, there will be families having a hard time putting food on the table and buying clothes for their children, with the result that these children may not do as well as they should in school. The federal government is sacrificing a whole generation to save a few dollars, primarily because of a lack of vision.

This is not just a dollars and cents issue. It is also a matter of heart. One must have a vision that comes from the heart but, unfortunately, the government opposite does not seem to have such a vision, a vision that would ensure that families can continue to live, grow and thrive on Cape Breton Island.

[Julian Reed, Liberal, Halton, ON]

Madam Speaker, there has been a lot of debate about Bill C-11 that did not focus on Bill C-11, but on the fairness of the $111 million human resource package that was announced in January 1999.

This funding was announced for a workforce adjustment program to deal with the loss of jobs associated with the closure of the failing mine. Unfortunately, the failing mine closed last September, about one year earlier than planned.

I think it is important that the House understand the status of this issue so that we can move on to deal with the issues surrounding Bill C-11 and the sale of Devco's assets.

In January 2000 Devco and its four unions agreed to form a joint planning committee, as per part III of the Canada Labour Code. Devco and the unions are continuing to follow the process as outlined in the labour code for resolving the workforce adjustment issues.

Recently this process led to the appointment of an arbitrator. Devco and its unions have agreed to a process to deal with the labour issues. The decision of the arbitrator will be final and binding on all parties. There is a process to deal with the labour issue.

Through a lot of effort, interest has been identified in Devco's assets. We are now at a stage where we should move forward with the process of considering Bill C-11. Now is the time to move the bill to the committee stage so that it can be examined in more detail.

The sales process announced by the government in January 1999 and initiated by the Cape Breton Development Corporation is at a stage where the private sector has come forward with definitive proposals for Devco's assets. Devco has a real opportunity to move its operations to the private sector and the step that is required by the House is to move forward with Bill C-11.

During this debate I have heard a lot of support for privatization from both sides of the House. It is important that we seize the opportunity to enable a private sector operator to acquire Devco's mining assets so that jobs can be maintained in coal mining. With the progress that Devco has made and the investments that prospective purchasers have made in carrying out their due diligence, time has now become of the essence in terms of moving forward with this bill.

The sale process will involve substantially all of Devco's assets. Subsection 90, part II of the Financial Administration Act stipulates that no crown corporation shall sell or otherwise dispose of all or substantially all of its assets unless authorized by an act of parliament. That is the reason for Bill C-11.

In addition to obtaining the authority to sell substantially all of Devco's assets, the bill will provide for the winding up of the affairs of the corporation and its eventual dissolution; provide for legal proceedings against Devco to be brought against the crown; maintain the general advantage of the Canada clause of the existing Cape Breton Development Corporation Act, thereby ensuring that the Canada Labour Code will apply to a private sector purchaser, and amend the Cape Breton Development Corporation Act to remove provisions that are no longer applicable.

This is a relatively simple straightforward bill. The first five clauses of the bill are the divestiture and dissolution authorization. Most of these clauses are standard for this type of legislation.

Next is a series of amendments to the Cape Breton Development Corporation Act that are of a housekeeping nature that reduces the number of directors on the board. Finally, there are consequential amendments to other acts.

It is now time to study these aspects of the bill in committee.

[The Acting Speaker (Ms. Thibeault)]

Before recognizing the last speaker, I should have told the House that from this point on we are getting into 10 minute speeches with no questions or comments.

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

Madam Speaker, it is with pleasure that I rise today to speak on Bill C-11. The issue of Devco and that of the whole coal mining industry in Cape Breton is one that has been grappled with by successive governments, particularly over the last 30 years when government involvement in Cape Breton coal mining reached a greater level in the late 1960s and Devco was formed as a crown corporation.

It has been a very difficult period in recent years with the decline in the coal industry and the resulting impact on Cape Bretoners, particularly in industrial Cape Breton.

We all recognize that we are in the midst of a transitional economy, from a resource based traditional industrial economy into, and we are well into it, a knowledge based economy where most of the opportunities in the 21st century will come not from bricks but more likely from clicks.

If we really look at some of what is happening in the global environment, we have to ensure that while we are preparing new generations to participate in the global knowledge based economy, we are not denying them the ability to take care of themselves and their families during a very difficult time.

There are several concerns about Bill C-11. We in the Progressive Conservative Party are supportive of the direction that the government is taking in a general sense in addressing the issue of the Devco situation. There are some significant problems with the compensation packages and some real fairness issues that have not been addressed in this legislation. If we compare the treatment of one coal miner to another depending on the length of time the miner has worked and the age of the miner, the formula seems to be in need of a significant amount of work. The fairness issue within the network of people who will be receiving benefits is clearly inadequate and wrong headed.

I have also heard some other members speak today of the comparative disadvantages of the pay out packages compared to similar situations with other precedents that have been set by government or crown agencies in the past. Again, as a member of parliament, I would hope, expect and demand that Cape Breton coal miners be dealt with fairly at this very difficult time.

I would also urge the government to do more work with the knowledge based economic players, whether it is the incubators like the University College of Cape Breton and Dr. Jacquelyn Thayer-Scott who is working with the University College of Cape Breton to create a greater level of economic opportunity in the new economy there. I would hope that the government recognizes the value of that very important incubation infrastructure for the new economy and continues to increase levels of support for it.

I would also hope that the government would look at ways to obtain a more competitive or advantageous tax structure. Tax advantage zones can be created within Canada in places like Cape Breton. Many people compare Canada with Ireland and the tremendous growth that has been seen there in recent years. Ireland has had a 92% growth in GDP per capita over a 10 year period. This is not really a very good comparison.

If we compare Ireland to pockets in Atlantic Canada, particularly Cape Breton, and consider Ireland's relationship with the EU in the context of Cape Breton's relationship with other parts of Canada through the equalization system, I think we can quite quickly see a parallel of opportunities. If the government were to develop some type of tax advantage for companies to locate in places like Cape Breton, a similarly advantageous tax structure to what has been accomplished with Ireland's economy using some of the funding from the EU could be created. These are the types of things we should be looking at. The Atlantic Provinces Economic Council and the Atlantic Institute for Market Studies have done some very credible work on some of these areas and alternatives in the new economy.

There are some significant flaws in the fairness issue related to Bill C-11.

I urge all members of the House to be vigilant in not putting on any logical blinders when dealing with these kinds of issues. It is a difficult time for the coal miners of Cape Breton who are losing their jobs. We must ensure that they are dealt with as fairly as those in previous situations in other precedents in Canada with crown agencies.

I further urge that we continue working toward creating an economic environment for Cape Breton and all Canada where people can find greater levels of economic opportunities and prosperity within some of the new emerging industries as we begin the 21st Century.

[Libby Davies, NDP, Vancouver East, BC]

Madam Speaker, I rise today in the House with the same sense of outrage and frustration that has been expressed by other members. We are debating a bill that is of vital importance to the people of Cape Breton, to the people who have worked in the Devco mines and to the people who live in the communities that have supported those mines, and, I think for the 66th time in this parliament, we are facing closure on yet another bill. This will cut off debate and the life line that those miners have to voice their expressions of concern in this parliament about what is happening to them and their communities.

We are here in parliament to defend and uphold democracy. Whenever we have closure on debate and whenever debate is cut off and opposition members are cut off from holding the government accountable for the legislation it brings in, it is a sad day not just in this parliament but for all Canadians and something to which we should pay attention.

We are debating Bill C-11, the bill that means the death and dissolution of Devco, a program of this government to carry out policies that will have a very dramatic impact on the people of Cape Breton.

My colleagues in the federal NDP from Nova Scotia but particularly from Cape Breton, the member for Sydney—Victoria and the member for Bras d'Or—Cape Breton, have stood up in parliament and in the community in solidarity with the people of Cape Breton to fight this closure.

I will deal with two issues in my comments. One is the myth that surrounds the mining operations and what has taken place over many generations. Second, I will talk about the impact that this closure will have.

It is a myth that this mining operation is somehow a losing proposition and the government had no alternative but to step in and shut it down. The reality is that for over 300 years mining has been a part of this community. For over 300 years mining has sustained good paying union jobs for which miners in many cases have fought and died, for health and safety, for better wages and for better working conditions. In many instances they have given their lives to that community by working in these mines.

Over the years these mines have also provided great economic benefit. I am not from Cape Breton. I am from Vancouver East. I am from the other coast, the west coast. Yet the story that I see in Cape Breton is a story that is all too familiar across the country. In my own community of East Vancouver we have seen the government set up the proposition that somehow a community economic development operation that is getting a government subsidy, it is too late, it is too bad, we have to take the subsidy away and we have to somehow make it profitable.

The fact is that over the past 30 years the government has invested about $1.7 billion into the Devco mines. What has been put back into that local economy from spin-offs and the support that it has created in local communities has been more than $5 billion.

I know from watching the news reports on television and listening to my colleagues from Cape Breton that in the local community they know the truth. They know this mine could continue to be profitable and that the decision by the government to withdraw from this operation, devastating the lives of the local communities, is one of the worst things that has happened in this parliament.

In terms of the impact, I have to ask myself what would happen to a local community where there is an employment environment, whether it is a mine, or a fishery, or the woodworking industry in British Columbia, if that was suddenly withdrawn. I think last Christmas we saw an inkling of what that impact would be. Many of us were back in our ridings. I was paying attention to issues that were going on in Vancouver East and dealing with many important things. Every day I watched the national news and watched the miners who, in desperation, were trying to draw the attention of the government to their plight and what would happen as a result of these mine closures. It was really awful to watch.

The miners wanted to be home with their families. They wanted to get ready for Christmas, to buy Christmas presents and to celebrate with their families and friends. What were they doing? They were holding sit-ins and taking desperate measures because they felt like they were at the end of the line and had no options left.

I am proud to say that our members in Nova Scotia and Cape Breton were there standing in solidarity with those miners. They understood what was going on.

A lot of times in the House we debate issues around poverty, child poverty and the 1989 resolution to eliminate child poverty that was passed unanimously in the House. It seems that on occasion there is a sense of goodwill from the House that this is an important Canadian priority. We do not want to see children go hungry. We do not want to see children living in communities where there is economic and social devastation. However, with this bill, through deliberate conscious public policy, the government has created that kind of social and economic devastation. There will be more poor children in Cape Breton, a community that is already suffering.

My colleague from Bras d'Or—Cape Breton told me that to even come close to the level of what is happening on the mainland, Cape Breton will need another 13,000 to 14,000 jobs. Why would this mine closure make any sense? Why would this bill make any sense? Even the terms of the closure are disastrous in terms of not involving the miners and not developing compensation packages.

A few minutes ago we heard from our colleague from Sydney—Victoria who said that the miners, who have worked there for decades and who have literally given their working lives to this industry, will not be compensated, recognized or acknowledged in terms of their own health. They will leave this industry with no job, no protection for them or their families in terms of health care, no dental plan and no ongoing training. What a catastrophe. What does it say about the priorities of the government?

In terms of the impact on this community, I am sure there will be increasing anxiety not only about the closures but about what will happen at this point. We have already heard speculation and rumours that one of the mines might be up for sale and that it might be bought by a multinational corporation. It is insane that we have a government that is not willing to sit down in good faith with the local community, with those workers, their families, community leaders and the local members of parliament to find a way for this operation to continue. The miners were greatly interested in getting together and forming co-operatives and associations that would have allowed the mine to continue. They wanted to ensure that there was local control.

We talk a lot about community economic development. Here was an instance where the people in the community were committed, had the knowledge and the expertise. Did anyone else have more expertise than those coal miners to know how the operation should run and how it could be profitable? They were completely ignored by the federal government. We are here today debating the dissolution of these operations under an order of closure to cut off debate with speculation about a multinational corporation moving in.

The federal NDP wants to know what the federal government is doing to investigate potential buyers who may be there and come forward. We understand that there are multinational corporations looking at this particular operation and may want to put in a purchase offer. One of the rumours we have heard is that one such corporation buys its coal from Colombia. What we need to know is who will be mining that coal. Will child labour be used? Has the government done any investigation to assure the local community that whatever buyers are there are actually organizations and corporations that have legitimacy, credibility, a track record and are not using child labour in other countries or violating environmental standards?

The worst part is that we should not even be considering foreign buyers. We should be investing in this local community. We should be saying that these jobs have value and meaning and that the people of this local community have a right to come together to determine their own economic future. That is what we stand for in this party.

I want to move the following amendment:

That the amendment be amended by deleting the words “Standing Committee on Natural Resources and Government Operations” and inserting the words “Standing Committee on Human Resources Development and the Status of Persons with Disabilities” following the words “subject matter”.

[The Acting Speaker (Ms. Thibeault)]

At this point, I will reserve my ruling on the amendment as there may be a question of wording that may not be receivable. I will get back to the hon. member.

[Dave Chatters, Reform, Athabasca, AB]

Madam Speaker, I am pleased to again stand in the House to debate Bill C-11.

Since I last spoke to the bill on November 15, 1999, I have had an opportunity to visit Cape Breton and talk to the stakeholders in this issue. I met with union representatives, as well as two local bidders whose bids were rejected by Nesbitt Burns Inc. I also visited the mine sites, the coal wash plant and the old Sydney steel mill site. The visits certainly gave me a more indepth understanding of the issues surrounding the sale of Devco and how it will affect Cape Bretoners.

Despite the government's stated commitment to a speedy process for this bill, Bill C-11 seems to have totally dropped off the government's legislative radar until today. Everything else seems to be a priority for the government except for a bill that has so far-reaching and drastic effects on the lives of Cape Bretoners.

We might also suppose that a bill of such importance would be given due process and time, but no, yet again the government has decided to wait until the last moment before invoking time allocation to run the bill through the House of Commons as fast as it possibly can. After all, the government does not care to allow all members the opportunity to rise in the House and speak their concerns, or more important, the concerns of Canadians.

I can only wonder why the government is suddenly in such a hurry to speed Bill C-11 through the House. After all, it has always been acknowledged that before the sale of Devco could proceed, this bill had to be passed.

It makes me wonder if the rumoured American buyers are getting impatient to claim their prize. We know how chummy the Prime Minister likes to be with anyone south of the border. What else would motivate the government to suddenly move so quickly? Certainly it could not be the interests of Cape Bretoners and Canadians.

I am fully aware that Devco was created as a vote getting measure, despite the fact that as far back as 1957 it was recognized that the coal industry alone simply would not be sufficiently viable to sustain the entire economy of Cape Breton on a long term basis.

In 1966 the government announced a $55 million package to phase out coal mining in Cape Breton over 15 years, yet in the very next year massive expansion occurred within the region with the creation of Devco. Even as Devco was being created it was obvious that the coal mining industry in Cape Breton would not be viable if Devco had to accept the full liability of past generations of Dominion Steel and Coal Company employees who were abandoned when these ventures went into receivership. So began the government's involvement, what I would call interference, into the economy and viability of Cape Breton.

For the next 30 years the government continued to support Devco through a variety of subsidies and grants until finally in January 1999 the government announced that it was putting Devco and all its assets up for sale. That is 30 years of families coming to rely on the industry they believed would support them as they had supported Devco.

We are not just talking about a nine to five job that the miners can walk away from without any costs. A well known fact is the toll that coal miners pay with their health to work in coal mines.

Despite the costs, the miners went ahead and did their jobs believing they would have jobs in the industry which is all many of them have ever known. Yet the entire time the government has known differently.

Over the years through different governments which have come and gone, one thing has not changed regarding Devco. It simply was not working.

To sustain the economy, one could suggest to flow votes from Cape Breton to the government, the government continually sunk more and more money into Devco with the expressed intention of making the industry work. At the same time, an examination of the annual reports of Devco indicated that the government was intentionally manipulating the shutdown of Devco.

Because of that manipulation, Devco families have faced numerous shutdowns, failures to meet production targets, and stunning financial losses. It is those families in the Cape Breton community as a whole who are suffering from devious management manipulation.

When I first rose in the House to speak to Bill C-11, I raised a number of concerns regarding the accountability measures included within the bill. As I have just mentioned, governments over the years have done little to ensure that Devco was not used as a patronage plum. I would hope that in the final days of Devco, the government could at the very least assure Canadians that their hard earned money was not going to waste in some Liberal crony's pocket.

On March 20 a committee established to suggest ways to spend the $80 million set aside to cushion the collapse of Cape Breton's coal industry released a report which stated the following:

Cape Breton Island has experienced poor economic conditions many times...but none can compare to the present day. People are showing a lack of confidence in the future. Immediate action is required to both illustrate government's understanding of the problem and its potential to help.

I would like to remind everyone that such a situation is exactly what was predicted back in 1957. Here we are on May 8, 2000 and we are still looking at second reading of this bill, albeit in a rather drastic hurry.

The report was released almost a month and a half ago and the government is just now realizing it had better hurry up and do something about the situation in Cape Breton. After all, the Prime Minister has promised an election within the next year. I question the timeline of the government and its dedication to providing due process and consideration for the miners and Devco employees affected by the sale of Devco.

Speaking of the sale of Devco, I have a few questions regarding exactly how the sale is taking place. Let me provide a bit of background.

Clause 2(2) calls for subsections 99(2) to (5) of the Financial Administration Act not to apply to the disposal or sale of Devco assets. Back in November when I originally spoke to the bill I voiced my concerns as to why the FAA needs to be suspended for this sale to go through. More important, what will replace those controls? The FAA ensures that a sale such as this happens in an open, accountable manner. If these restrictions are removed, what will control such issues as who gets the successful bid, was a reasonable amount paid for the assets, was the transaction made in the best value for money interests and will the money return to the public coffers?

Another concern I raised in November was that only bidders and cabinet will have access to the bidding process. No one else can get information about how much the assets are worth. How will we know if the final price truly reflects the value of the assets? The reality is that whoever takes over the assets will not just get non-viable leftovers. After having invested millions of dollars over the last 30 years and thanks to governments never seeing any kind of return on investment, Canadians at least deserve to know the terms and conditions of the sale.

I am sorry to state that I believe many of my fears regarding the process of the sale of Devco are being realized. Mr. Joe Shannon, currently on the Devco board of directors, was first appointed by cabinet on July 4, 1995 to be the chairman of the Devco board for a three year term. On July 26, 1995 cabinet authorized the board's decision to have Joe Shannon act as president of Devco. Mr. Shannon was reappointed to the board of directors for another three year term on August 26, 1998.

Mr. Shannon has obviously done fairly well through his appointments. At the same time he was leading Devco he was also president, director and chief executive officer of Seaboard Transport. While Joe Shannon was head of both companies, Seaboard Transport received a multimillion dollar contract to transport coal from the mines to the Nova Scotia power plants and the wash plant, a clear conflict of interest.

That is not the end of the story of Mr. Shannon. He is currently participating with Nesbitt Burns assessing bids for the sale and divestiture of Devco assets. Mr. Shannon clearly has a vested interest in ensuring his own interests are considered by whoever takes over. Judging by his lack of qualms in sitting on both the Devco and Seaboard Transport boards, I am doubtful that Mr. Shannon will suddenly find himself a conscience and act on what is truly in the best interests of Devco, Cape Bretoners and Canadian taxpayers.

Not only do I have concerns regarding the goings on in the boardroom, I have serious doubts regarding the bidding process for Devco and how decisions are being made as to who is seriously considered. In the March 20, 2000 edition of the Cape Breton Post a letter from Kevin Murphy, vice-president of the Cape Breton Miners Development Co-operative Limited, stated the concern of many Cape Bretoners that the bidding process for Devco is freezing out local bids. Mr. Murphy stated the following:

We feel that handing off the Nova Scotia Power Inc. supply contract to foreign suppliers is an unacceptable situation and we decided back in May to do something about it by forming a workers co-op and subsequently submitting a bid for the Devco assets through the Nesbitt Burns process.

Our bid was rejected, as was a bid put forward by Donkin Resources Limited, which is determined to press on with opening the Donkin mine with the support of the community and groups such as our co-op, which is ready to invest in the project to ensure that at least some of the NSPI coal is supplied by Cape Bretoners.

Mr. Murphy went on to question why the federal government would rather hand over a lucrative contract to a foreign company when the coal could be supplied locally. He concluded that “there is money to be made in the industry and that it should be reinvested here for the future of our people”.

I quoted extensively from Mr. Murphy because I do not think it could be said any better. Cape Bretoners are ready, prepared and anxious to rebuild their economy—

[The Acting Speaker (Ms. Thibeault)]

Order, please. I must interrupt the hon. member. Ten minutes has elapsed, unfortunately.

[Lynn Myers, Liberal, Waterloo—Wellington, ON]

Madam Speaker, it is a great honour to speak to this very important bill, Bill C-11. It deals with Devco, the Cape Breton Development Corporation divestiture authorization and dissolution act.

It is important to put this matter into some context in the sense that subsection 90(2) of the Financial Administration Act stipulates that we need to go through this process in order to meet the requirements under that act. It is very important that we proceed accordingly.

I was somewhat heartened by the member for Kings—Hants. He spoke in very reasoned tones and appropriately so. It was important that he went on record as indicating that the party opposite was in agreement with how the government was acting. It certainly made a great deal of sense to me. It is important that we proceed accordingly.

I was a little disappointed with the Canadian Alliance member, the member for Athabasca, who talked in terms of the Americans and how they interact with Canada. If anyone should be looking in the mirror when it comes to the Americans it is the alliance party. That party is in favour of a two tier American style health system. Members of the Canadian Alliance should be the last people in the House to talk about Canada's interface with the Americans.

The member for Athabasca seemed to drag a few people and the process through the mud today. I take exception to that. It is inappropriate and not very beneficial to the debate. Quite frankly it is typical of those alliance members in what they do, how they say it, and the kind of actions they seem to take delight in making.

Having said that, I have been to Cape Breton a number of times, at least three times and most recently twice. It is very important to meet with the people there. I have met with people in the area, union people, local officials, families. It is important that we on the government side listen carefully.

I was astounded by the NDP member for Vancouver East and the outrageous things she said about bringing in the end to this debate and proceeding forward. She knows full well, as do all the NDP members opposite, that we have had a number of hours of debate in the House on this very important bill. Instead the member said that we are somehow abusing the system when in fact it is the contrary. What we are doing is bringing closure to this very important bill.

Instead the member talked about poor children. She talked about child labour in other countries. She talked about rumours that she had heard. Imagine, in this great parliament of ours members opposite, especially the NDP who should know better, getting up and dealing in rumour and innuendo. Is that not typical of the NDP members who always are delighted in throwing tons of money at everything. Instead of taking a reasoned, natural and good rational approach to things, they always throw money at them, which is a typical NDP philosophy.

Instead we on this side of the House are putting a process in place for the benefit not only of the good people of Cape Breton, of Devco and those people who are in need but by extension for all Canadians. That is important to note. It underscores the commitment of the Government of Canada in this all important area.

The NDP members in this debate have been twisting this fact and I find it reprehensible that they would do it. I want to point out that on October 1, 1999 the Cape Breton Development Corporation advised the federal Minister of Labour that it would be terminating the employment of approximately 600 employees due to the closure of the Phalen colliery.

On January 13 the company and the four unions representing Devco employees agreed to form a joint planning committee as per part III of the Canada Labour Code. The committee met in an attempt to reach agreement on the terms of an adjustment program that was unsuccessful, which was unfortunate.

The employee representatives on that committee notified the Minister of Labour of their inability to reach agreement with the company. On March 14 the Minister of Labour appointed a person as mediator to assist in the negotiations and failing agreement, to advise her on the matters appropriate for arbitration pursuant to section 224 of part III of the Canada Labour Code.

We are now at that point and into binding arbitration. As most members of the House know, it will be binding not only on the company but on the members and the employees involved, as well as on the Government of Canada. We expect that report some time in the very near future and some talk as early as the end of May. We need to proceed in that fashion. It is important and it makes a great deal of sense.

It astounded me when I heard the Alliance member, the hon. member for Athabasca, talk in terms of little or no consultation. That really is an out and out falsehood.

[Some hon. members]

Oh, oh.

[Lynn Myers, Liberal, Waterloo—Wellington, ON]

Members from the NDP know that as well. Listen to them caterwauling instead of listening to the speech. They are caterwauling and trying to stir things up. They should listen. What I am about to say is worth listening to.

The minister met with all kinds of officials in that part of the country. He met with management. He met with unions. He met with business and community leaders. He met with local clergy, for that matter. He met with representatives of the provincial government. He has gone out of his way as have other members of the government, instead of stirring things up, trying to undermine the process and trying to act on rumours, innuendo, falsehoods and myths like members of the NDP. Instead of doing that, we on the government side got our facts and listened to the people to ensure that we were involved in great consultation by way of process and how best to deal with the good folks in that part of Canada.

At the end of the day, is it perfect? I do not think so. However at the end of the day we have put in place a great process which makes sense ultimately. It will assist that part of Atlantic Canada and, more to the point, Cape Breton. It will do so in a manner consistent with the values of people in not only that part of our country but Canadians wherever they live in our great land.

It is important that we have done it in a methodical, wise and reasoned way, instead of operating as some members of the opposition have, that is by way of falsehoods, stirring things up and making mischief, quite simply, which I think is absolutely inappropriate.

The plan is in place in a way that Devco has now received definitive proposals for its assets. The corporation is at a stage of evaluating and clarifying one of the proposals with a view to finalizing the broad terms and conditions of the sale. Hopefully that will be done in the very near future, and again there is talk of as early as June. Negotiations concerning a final detailed purchase and sale agreement would follow accordingly, as would be the normal course of events.

This is following what the minister, the officials and government have seen as appropriate in terms of this important issue which strikes to the heart of a great many people in that part of Canada. We understand that. We respect it and we have tried to deal with it in a sensitive and reasoned way.

The prospects for transferring the assets of Devco to the private sector and for maintaining coal mining jobs in a private sector commercial operation are very real. That has been a goal of the government from the outset. Instead of trying to create mischief and doing those kinds of things, with a steady hand the government is trying to ensure that we can carry on with employment in an area that requires our assistance. We as a government have always tried to do the right thing, which is to assist people.

Unlike others in the House who might try in a Darwinian economic sense to let people hang out to dry, we have never done that, not through history and certainly not now. We will do the right thing to ensure that the transition from the jobs of the past to the new economy will take place in a way consistent with the values that are appropriate to Canadian society. So it is that we proceed in this important area.

I have great friends in Cape Breton with whom I have talked repeatedly. I have visited there on a number of occasions. It is important that we deal with the matter in a way consistent with not only what those people want, because obviously they are important in this equation, but in the best interest of the country as a whole. It is with great honour that I say we will now bring the bill forward, vote on it and get on with the business at hand. Why do we do that? We do it because it is ultimately not only in the best interest of the people of Cape Breton and specifically the employees of Devco, but it is in the best interest of Canada as a whole.

[The Acting Speaker (Ms. Thibeault)]

At this point I would like to advise the House and the member for Vancouver East that the amendment to the amendment she proposed earlier is not in order because it would render the amendment unintelligible.

[Dick Proctor, NDP, Palliser, SK]

Madam Speaker, I am pleased to take part in the debate on Devco. I wanted, especially after the last speaker, to put before the House and others who may be listening what is at stake.

We are talking about the direct loss of close to 1,500 well paying jobs. We are talking about the loss of almost $80 million per year in wages and salaries to that region. We are talking about the loss of $28 million a year in Canada pension, employment insurance and income tax. We are talking about a total estimated annual economic loss, direct and indirect, as high as $300 million for the region of Cape Breton.

The previous speaker would have everybody think that this is a very minor bill that will through and what is the problem. As I understand it this is the 65th time the government has introduced time allocation or closure, as most Canadians know it. Not everybody, but most of us know that 65 is the age of compulsory retirement for humans in Canada. We think it is time to retire this kind of time allocation and allow debates to be held in the House on a timely basis.

In February we on this side of the House endeavoured to have an emergency debate to discuss the matter, and of course it was denied. Here we are two and a half months later and we have time allocation.

Leading up to the debate in February there were newspaper stories that Canada Steamship Lines had expressed interest in purchasing the Cape Breton Development Corporation, and we know who heads Canada Steamship Lines today. The story in the newspapers is that Canada Steamship Lines is now purchasing new ocean freighters from a low wage Chinese shipyard. This is just days after a ship was launched in Saint John, New Brunswick. Many workers there feel it is the last ship that will ever be built at those docks.

What we are talking about and what members opposite do not want to talk about is almost certainly the imminent sale of Devco. They say they have to get on with it, but they are not saying who is the prospective buyer. We know almost with certainty that it will be a foreign buyer, almost certainly an American one.

I want to spend a few minutes telling the House what has been happening in the last few years in Canada with regard to foreign ownership. The fact of the matter is that for a relatively stable number of years, several years, the inflow of foreign ownership into this country roughly matched the amount of Canadian investment overseas.

However, in 1998, foreign ownership in this country jumped fourfold to $24 billion. In 1999, according to Statistics Canada, the figure was $36 billion or six times what it had been three or four years earlier. We are seeing the selling off of the country, the takeover, the buying out of our low dollar that has now dropped below 66 cents. This, coupled with the surging American economy, has made Canada a haven for buyouts.

We will see it again with Devco. We see the figures indicating that it has been losing money in the last number of years. Where did we hear that kind of story before? Canadian National was losing money on paper until it was taken over. Now 75% or 80% of it is owned by Americans and, wonder of wonders, it has turned the corner and is making a handsome profit. We will see absolutely the same scenario with the Devco operation.

The most telling of points for Canadians would be the very graphic television images of people who went underground to protest what was happening around Christmastime last year in Cape Breton Island. They stayed there until we thought a deal could be sorted out. These are the images regarding this issue that will stay with Canadians for a long time.

A number of other costs cannot be calculated. They include an increase in out migration from Cape Breton, a region that over the past decade and a half has seen a population decline of over 7% and a drop in employment opportunities resulting in the closure of Devco. The $68 million that have been committed by the government to encourage sound, long term economic development in Cape Breton is far less than the close to $300 million generated in the Nova Scotia economy annually by Devco.

The federal government's commitment to work closely with the province and the community to identify strategic investments for the $68 million is a farce. After more than nine months of silence and inaction, the few weeks of public consultations is an absolute insult to the community.

The government has repeatedly stated that no decision on the future of Devco would be made without prior consultation with the stakeholders and the community. Yet no meaningful consultation has taken place to date. That is what we have been after. That is what my colleagues, the member for Bras d'Or—Cape Breton and the member for Sydney—Victoria, were demanding when they asked for an emergency debate in the middle of February that was denied by government members.

It is correct to say that the federal government has put more than $1.7 billion into Devco over the past 30 years, but Devco has generated over $5 billion in return into the economy. It has been a very happy and convenient arrangement for the people of Cape Breton. Before I sit down I move:

That the amendment before us be amended by deleting the words, “Standing Committee on Natural Resources and Government Operations” and inserting the words, “Standing Committee on Human Resources Development and the Status of Persons with Disabilities”.

[The Speaker]

I find the amendment to the amendment to be in order. We will take up the debate after question period. This theme encapsulates the guiding principle of all Red Cross work which is the rehabilitation of people suffering the consequences of war, violence, natural disaster and malnutrition.

Red Cross And Red Crescent

[Yvon Charbonneau, Liberal, Anjou—Rivière-Des-Prairies, QC]

Mr. Speaker, it is my pleasure to inform the House that today, May 8, is World Red Cross/Red Crescent Day.

This day celebrates the humanitarian work of millions of Red Cross/Red Crescent volunteers worldwide.

The Red Cross provides assistance to countless victims of conflict and disaster. Last year alone, the Canadian Red Cross Society helped victims of earthquakes in Turkey, Taiwan and, just recently, in Mazambique.

In honour of the millennium, the international family of the Red Cross is celebrating the theme, power of humanity. This theme encapsulates the guiding principle of all Red Cross work which is the rehabilitation of people suffering the consequences of war, violence, natural disaster and malnutrition.

Please join me in recognizing the Canadian Red Cross Society for its work and in wishing a very successful World Red Cross/Red Crescent Day.

Victory In Europe Day

[Art Hanger, Reform, Calgary Northeast, AB]

Mr. Speaker, on this anniversary of Victory in Europe Day we reflect on the courage of our war veterans who fought so that we could be free. It is also necessary to acknowledge some veterans who were abused and forgotten.

For years, some military personnel were used as guinea pigs by the Department of National Defence for mustard gas experiments. This is a source of national shame, a tragic example of bureaucratic immorality and a story of human suffering. Yet the government has never apologized to those it deemed fodder for chemical warfare tests.

The government finally acknowledged the assault that was committed on the lives of these men in a Suffield ceremony on May 5, 2000, but many are still battling for some form of compensation. This is outrageous. Not only should these experiments never have happened, but the victims should not have to fight veterans affairs today. Surely they have suffered enough indignity, personal loss and injustice.