Debates of June 6th, 2000

Division No. 1350

[The Acting Speaker (Ms. Thibeault)]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Acting Speaker (Ms. Thibeault)]

All those in favour of the motion will please say yea.

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

Division No. 1351

[The Acting Speaker (Ms. Thibeault)]

I declare the motion carried.

I wish to inform the House that, because of the delay, the hour set aside for Private Members' Business will not take place this evening. The order is therefore deferred to a future sitting.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

[Walt Lastewka, Liberal, St. Catharines, ON]

Madam Speaker, I am pleased this evening to have the opportunity to call on the Minister for International Trade to take action on the market access to Canadian wines.

Canada has been proactive on export issues. We work one on one with Canadian businesses through team Canada trade missions. We actively participate in world trade issues and we provide financial and other support for businesses. The results have been positive with a record $410 billion trade surplus last year. Not only was that a record but it was an 11.3% increase over the year before.

While we have had overall success with exports we have not experienced the same success with wine exports. We have serious market access problems with trade imbalances. At a time when Canadian wines are winning international awards and being enjoyed by wine lovers the world over, we have some serious export shortfalls. Let me be more specific.

In 1999 Canada imported more than $565 million worth of wine from Europe. At the same time Canada's exports to the European market were just over $400,000.

We are allowing a huge amount of EU wines into Canada. In fact the LCBO in Ontario is the world's largest export market for French wines. Unfortunately we are not getting equal access to their markets. We have a huge trade imbalance of over one million to one. That is unacceptable.

Let us look at another example. In 1992 the GATT panel ruled against the United States on its anti-importation barriers for wine. The panel said that the U.S. discriminated against imports at both the federal and state levels.

Today most of these barriers still exist. A recent report from foreign affairs and international trade says that there are new trade distorting measures affecting Canadian exports that have been added by American states since the GATT panel ruling of eight years ago, all of this while Canada remains the largest export market for American wine. This is not a record we can take pride in.

At a time when exports are high, our trade surplus is larger than ever. Canadian wineries are making excellent products. We have been unable to break into two of the most important markets, the United States and the EU.

This debate is about helping businesses to succeed. It is about providing Canadian entrepreneurs, farmers and business people with the best possible chance for success, and that means access to markets, increased exports and jobs.

Canada's wine industry is a growing, thriving success. Canadian wineries have outdone themselves in creating excellent products in a very short amount of time. Our industry is new but it is excelling. This growth has happened without the huge subsidization which occurs in Europe and even in the United States. Now we need to give our wine industry the chance to grow and export around the world.

Earlier this year a vintner's enterprise study was completed on the wine industry in Niagara called “Jazzin' in the Vineyard”. I would like to summarize my remarks with a quote from that study. It says:

If the wine industry is to become internationally competitive, it needs a level playing field in which to participate.

I think that sums it up nicely. I urge the Minister for International Trade to give this issue his full attention and make it a number one priority.

[Bob Speller, Liberal, Parliamentary Secretary to Minister for International Trade Lib.]

Mr. Speaker, on behalf of wine producers of Ontario I thank the member for his tough stands on the issue. He always lets us know the views of his constituents, in particular wine producers in Ontario.

Canadian wine producers are making world class wines, as the member would know. We are exporting many of these wines to the United States and Europe. They are very important markets for us.

With respect to market access to the European Union, let me assure the hon. member that this is a priority of the Government of Canada. We are making every effort to obtain improved access to European markets for Canadian wines, including ice wines from his region.

I am fully aware of the frustration which exists in the industry and at the provincial level about the significant imbalance of market access. We are making every effort to address this situation.

The Minister for International Trade raised this issue directly with many ministers of trade in the European Union and will continue to do so. At the departmental level over the past few months we have been discussing both wine and spirits issues with the European commission to determine the possibility of reaching a bilateral agreement that would be beneficial to these producers.

Officials addressed such subjects as how both sides make wine and improving the protection of geographical indications. The latest meeting in March showed that there were significant differences between our two jurisdictions on the issue. We remain optimistic that agreements can be reached if we focus our efforts on a limited, realistic agenda.

We will continue to consult with the industry and provinces in an effort to develop possible ways to bridge the existing differences between the two sides.

Canadian wines, I might add, are doing well in the United States. Exports have grown to $2.7 million in 1999, an increase of some 200% over the last two years. The Americans are waking up to the great wines we have here in Canada.

The wine, beer and spirit sector tends to be more regulated than most others and is marked by a myriad of rules and regulations governing the trade, sale and distribution of these products. Some of these rules and regulations fall within the scope of Canada's trade agreements, others do not. For example, some states have technical and labelling requirements. These are often beyond the reach of trade agreements as they apply equally to in state and out of state as well as imported wines. As well, it is normal for subnational jurisdictions, provinces or states, to create local regulations on access and handling, typically relenting to revenue protection and social responsibility.

I want to thank the hon. member by recognizing the hard work of the hon. member on behalf of the wine industry. I assure him, on behalf of the Government of Canada, that we take this issue very seriously and we will continue to fight on behalf of these producers.

[The Acting Speaker (Mr. McClelland)]

Pursuant to order made earlier today, the motion to adjourn the House now is deemed to have been withdrawn, and the House will now proceed to consideration of Bill C-11 at third reading.

Cape Breton Development Corporation Divestiture Authorization And Dissolution Act

[Ralph Goodale, Liberal, Minister of Natural Resources and Minister responsible for the Canadian Wheat Board]

moved 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 third time and passed.

Mr. Speaker, I am happy to have the opportunity to open the third reading debate on Bill C-11 pertaining to the Cape Breton Development Corporation.

As this debate has proceeded over the last number of days and indeed over the last number of months, I have been monitoring it very carefully through all of its stages. Much has been said sometimes with a great deal of passion and no doubt that will continue tonight.

I very much respect the deep convictions of all of those who have taken part in this discussion. At the same time I hope that our final debate this evening can steer clear of personal attacks or unwarranted invectives. While we may differ with each other honestly and sincerely on the most appropriate course for public policy to take, I hope we can all agree at least that each member in this House, in the government or in the opposition, is trying to do the very best possible job her or she can in dealing with what everybody agrees is a very difficult problem for the people of Cape Breton.

What I seek is not to criticize or vilify any other member because he or she happens to disagree with my approach. Instead I am focused and the government is focused on meaningful solutions that are as good and as effective as they can be in the reality of the circumstances that we all have to face.

As I have said before the Standing Committee on Natural Resources and Government Operations and also in this House, the key elements of the government's approach to Devco and the circumstances in Cape Breton are really threefold. First is the successful sale of Devco's assets to be able to maintain a viable coal operation and the associated jobs on a sound footing in the private sector. Second is a fair and reasonable human resources adjustment package to assist those who cannot remain in the coal sector. Third is new economic development initiatives which are community based and contribute new dimensions to the Cape Breton economy and way of life.

On that latter point, in January 1999 the government announced as part of its overall package of proposals with respect to Devco a $68 million fund to invest in long term sustainable growth in Cape Breton's future. The province of Nova Scotia later added another $12 million to that amount to make a total of $80 million available for these future investments to build the Cape Breton economy. Consultations on how to invest this funding were recently completed. A strategy for the delivery of the appropriate funds is now under development and it should be in place very shortly.

I would like to make reference to the report of the consultative panel who went to work on this issue to hear firsthand from the people of Cape Breton what their hopes and aspirations would be for the use of that funding for the future. The consultative panel was chaired by Mr. Michael Kelly and included six other very distinguished people who have very deep roots in Cape Breton and a keen understanding of the circumstances in that important part of Canada.

The report which they have produced and which was released a short time ago is a very interesting description of the circumstances on Cape Breton. More than that, more than looking backward, the report offers a breath of fresh air, a new look toward the future at what could be if certain circumstances come about and if the $68 million from the Government of Canada and the $12 million from the Government of Nova Scotia are properly invested.

The report is a summary of discussion themes that were brought forward through presentations and written submissions during the consultation process on economic renewal. Sessions were held throughout Cape Breton Island in November and December 1999. In total, 214 presentations were made and 210 written submissions were received. Hundreds of Cape Bretoners from all walks of life attended meetings from New Waterford, Glace Bay, Sydney, Sydney Mines, Baddeck, Port Hawkesbury, Petite-de-Grat, Chéticamp and Ingonish. They contributed ideas and suggestions on how to grow a new economy for the island.

The report is a result of all of that consultation. It emphasizes the importance of taking advantage of the growth potential of certain key sectors, facilitating the impact of established industries, enriching Cape Breton Island's investment climate, fostering trade to grow wealth and the opportunities associated with exciting decisions on new government services and programs.

For any members who are sincerely interested in this crucial issue of revitalizing and changing the direction of Cape Breton's economy, I would certainly recommend a very close reading of that report from the consultative panel. The panel members did their job well. On behalf of the Government of Canada I want to thank them for the enormous effort they made to make sure that the voices of Cape Bretoners were heard in this process.

Consistent with the work of the panel and the thrust of its report, we have already begun to invest. Some $7 million has been allocated to a new EDS customer service centre in Sydney, Nova Scotia. This undertaking has the potential to generate up to 900 new jobs on Cape Breton Island within a five year period. As the member for Sydney—Victoria and many others have noted publicly, this will be helpful in building a better future and there will be more to come.

With respect to the workforce adjustment package, the basic proposal worth $111 million was originally announced in January 1999. In full compliance with all existing collective agreements, that original package provided a combination of early retirement incentives and severance and training payments and was predicated on certain practical assumptions.

One of those assumptions was the continuation of coal mining operations in the Phalen mine on Cape Breton through all of 1999 and most of 2000. As we all know, that assumption did not come to fruition. In fact for the most compelling of geological and safety reasons, Phalen had to close about a year sooner than had been expected.

Last year with the announcement that Phalen would have to close prematurely, we immediately indicated that parts of the original human resources package would need to be re-evaluated to take into account this unexpected change in circumstances. That evaluation was under way when in January of this year the union leadership at Devco renewed its request for a formal joint planning committee process to resolve all outstanding human resources issues under the full terms and conditions of the Canada Labour Code.

The process under the Canada Labour Code involved several defined steps which were meticulously followed as the unions had requested. This included the selection of Mr. Bruce Outhouse, an eminent arbitrator who was well qualified and fully acceptable to all sides.

As members of the House know, the joint planning committee process was taken through to its final stages with the binding arbitration decision published on June 2. The decision has expanded the eligibility for the early retirement incentive program and has provided medical benefits for those who receive a severance and training package, as well as a number of other features.

Devco indicates that in addition to the previous 340 miners, an additional 249 employees will now be eligible for an early retirement incentive.

The government and Devco will address the financial implications of the decision of the arbitrator. These are considerable, in the range of about $50 million, in addition to the $111 million that was announced in January 1999.

I will now turn to the sales process. As I have said in the House before, Bill C-11 relates to the sales process. It is very straightforward and its purpose is simple. It satisfies the necessary legal requirements to authorize the sale of Devco's assets including those requirements that are contained in the Financial Administration Act as passed by the Parliament of Canada.

In June 1999 Devco hired BMO Nesbitt Burns Inc. as its financial adviser to manage the sales process. Last August the first task for Nesbitt Burns was to review the sales process at public meetings in Cape Breton with community and stakeholder groups and to obtain their input. Beginning in October 1999 Nesbitt Burns contacted 60 prospective purchasers. In December, Devco on the advice of Nesbitt Burns identified a short list of prospective purchasers who were invited then to submit definitive proposals. Such proposals were received by the Devco board.

Devco is now at the stage of evaluating and clarifying one of the proposals with a view to finalizing the broad terms and conditions of a potential sales agreement, perhaps as early as later this month. Negotiations concerning a final detailed purchase and sale agreement would then follow. A final deal is subject to both Devco board and Government of Canada approval.

The prospects for transferring the assets of Devco to the private sector and for maintaining coal mining jobs in a viable private sector commercial operation for the future are very real. It is important that we move forward with this opportunity. That is what this legislation is all about.

This bill was first introduced in the House on October 27, 1999. Second reading debate took place last fall and this spring. Over 25 members have spoken to the bill during House and committee proceedings.

It is our strong conviction that passage of the bill and the establishment of a commercial operation is the very best way to try to ensure that coal mining will continue to provide jobs and contribute in the long term to the economy of Cape Breton. This is an important step in reshaping and revitalizing Cape Breton's future prospects and it needs to be kept in the context that I have described. It is not a sale all on its own.

In addition, there is the $68 million economic development fund provided by the Government of Canada to which the province of Nova Scotia has added a further $12 million. Through that funding and through the regular funding of the Atlantic Canada Opportunities Agency, Enterprise Cape Breton Corporation and Human Resources Development Canada, our government will continue to work with Cape Bretoners on a wide variety of fronts to diversify their economy beyond the coal sector, which we hope to preserve through the private sector transaction that this legislation is all about.

Of course, in addition to the sale, in addition to the economic development initiatives, in the short term a solution has also been found to the contentious and difficult human resources issues. That was done through the independent work of a distinguished arbitrator who was approved in advance by the unions, and in fact put into place at the unions' request.

Despite how difficult and contentious the issues surrounding Devco have been and continue to be, I hope that we can all now turn our attention to using all available resources, all available talent and brain power, all available commitment and dedication to maximize Cape Breton's future potential to turn the corner toward something that can be much better in the future, to do the very best we humanly can to ease the burden and to smooth the way.

I want to thank all members of the House, whether they agree with the government or not on this issue. I believe very sincerely that they have approached this issue in a conscientious way, in a passionate way, and I thank them for their contributions to the debate as it has unfolded.

I would particularly like to acknowledge the very good work that the committee chair, the member for Eglinton—Lawrence, has done and all of the members of the committee. I would also like to acknowledge the very good work of the member for Algoma—Manitoulin, who is my parliamentary secretary and who has assiduously worked every step of the way on this important bill.

I also want to acknowledge and thank members of the opposition, particularly the members of the New Democratic Party who represent the area most affected by this legislation. Again, while we may be on opposite sides in some of the debates, I hope at the bottom line we share a common desire to try very hard to do the right thing to improve the quality of life of the people of Cape Breton.

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

Mr. Speaker, I rise on a point of order. I would like to ask for the unanimous consent of the House to have the opportunity to question the minister on such an important piece of legislation.

[The Acting Speaker (Mr. McClelland)]

The member for Bras d'Or—Cape Breton has asked for unanimous consent to provide for a period of questions. Is there unanimous consent?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[Dave Chatters, Reform, Athabasca, AB]

Mr. Speaker, I rise once again to speak to Bill C-11. I listened with great interest to the minister's speech. My mother used to coin a phrase that I thought was very applicable in this instance. While the minister's speech was very conciliatory and praised everyone involved, my mother used to say that actions speak louder than words. In this case I think that is most applicable.

This issue was brought before the House in October 1999. I first spoke at second reading on the bill in early November 1999. The whole thing sat gathering dust until very recently. Then it came forward again, we finished second reading and it went to committee.

There was a fairly substantial list of witnesses at committee who had interests in this bill and the issues around it. Some of those witnesses were given less than 24 hours to appear before the committee. They had to rearrange family affairs, job schedules and all of those things.

They were brought in, four or five witnesses at a time who were not truly connected in their issues. They sat down to participate in what was termed a round table discussion at committee, which did not give either the witnesses an adequate opportunity to present their case or opposition members an opportunity to question them at any length to get to the bottom of the issues they were bringing forward.

On top of that, my colleagues on the committee introduced two amendments to the legislation. I believe the NDP introduced about five amendments. None of the amendments introduced by either party would have substantively changed the bill. I support the concept of privatization. It is a good idea and it should have been done sooner. However, there were ways to do it.

Had the government really been looking for some co-operation on the bill, it could have accepted every one of the amendments introduced by my party and the NDP. My amendments, hopefully, would have brought some clarity and accountability to this deal after it was done, respecting commercial confidentiality, but having the auditor general a year from the date of the sale examine the whole sale and its terms and conditions and report back to the House. Certainly the NDP had some good amendments in the interests of the miners and the workers involved that would have protected their interests by guaranteeing certain membership on the Devco board and the pensioners' adjustment board and all of those things.

It would have been a marvellous sign of good faith for the government to simply accept those amendments and it would have been a good strategy in my opinion. If the government had accepted those NDP amendments, which were not substantive, then I do not see how either my party or the NDP could have continued to oppose the bill, but I may be being too optimistic.

It seems to me that there is some kind of agenda going on here. In committee when I asked the minister if at some point Canadians could see the terms and conditions of the sale so as to understand the terms for whoever buys Devco, the minister himself said that he would have no problem with that. Then one of his officials whispered in his ear. I have no idea what he whispered, but certainly very quickly the minister said that perhaps the parties to the sale would not accept that clarity or accountability. That is a real shame.

After the conciliatory speech of the minister I do not want to be mean-spirited, but one has only to look at the history of the government and how it has operated in the time since I have been here. I refer to some of the activities around grants and contributions in Human Resources Development Canada. I simply do not trust the government to act in the best interests of Cape Bretoners or Canadians. I demand accountability and clarity to assure that those things are met because I do not believe that they will be.

When I was in Cape Breton I heard rumours from miners, the unions and prospective buyers. The story I heard was that the government intends to sell the assets of Devco to an American company which is already importing South American coal to Cape Breton. That bothers me.

We have coal miners in Cape Breton. We have an industry that has been operating in Cape Breton for some 300 years. We have some of the best mining expertise in the world in Cape Breton. We have a guaranteed market for the coal which is mined, and we have all kinds of coal to be mined.

For the Canadian government to abandon those coal miners and that industry in Cape Breton in favour of giving it to an American company to bring American or South American coal to Cape Breton is wrong. I cannot help but think it is very wrong.

It seems to me that it perhaps has something to do with a former environment minister who stood in the House and said that the coal industry was an environmentally dirty industry and that her government intended to phase out coal mining in Canada. I cannot help but think that is part of the agenda. I do not know how else one might explain the absolute refusal of Nesbitt Burns, in co-operation with the chairman of the board of Devco, who reviewed the bids which were coming in, to accept or consider Canadian bids.

I met with two groups when I was in Cape Breton, both of whom submitted bids for Devco, both of whom told me that Nesbitt Burns had phoned them, had refused to give them anything in writing that they could pass on to myself, to members of the NDP or others, and told them that their bids would not be accepted for consideration.

Coming into the committee process, I asked that one of those private sector Nova Scotia bidders be allowed to come to committee to tell the story. The spokesman for that group was not even phoned and asked to come before the committee to present the story. I think that is wrong.

Of course, the other group which also had a local bid in for the assets of Devco just happens to have a lawsuit against the Government of Canada for reneging on its commitment to the company in conjunction with Donkin Mine. Again, I do not see how the government could possibly sell Donkin Mine, which is part of Devco's package of assets. How could it sell when the whole thing is tied up in litigation before the courts?

I do not think that could be done. Certainly if I was part of that group I would very quickly get an injunction to stop the sale before it took place.

There are all kinds of issues. There are issues of mismanagement, on which the parliamentary secretary would not allow questions in committee. I think there is a long history of mismanagement around the operation of Devco and there continues to be today.

I am not a miner or a mining engineer, but when I accessed the yearly financial statements of the corporation I could see for myself, and certainly others in Cape Breton pointed out to me, that for some time there has been a management regime in place that appears to be bent on putting Devco out of business and putting Devco's financial statements in the red. There was a deliberate attempt to wind down Devco through mismanagement and lack of capital investment, lack of maintenance, and all of those things.

We were not allowed to discuss those issues by the government, through the parliamentary secretary. The parliamentary secretary is a person I have come to have a lot of respect for over the years in which I have sat on the natural resources committee. I think that he has bent over backward to be fair on many occasions when he was chairman of the committee and I have a lot of respect for him. I can understand what was going on in committee and around this bill, but that does not make me any less disappointed about what took place. We were repeatedly told that the committee was a legislative committee dealing with a bill and that we were only allowed to deal with issues arising out of the bill, not the issues that are connected to the sale of Devco but are not actually part of the bill.

As the witnesses appeared before the committee, after short notice, they were asked to sit down three, four and five at a time and told that they had 10 minutes between them to present their case. In some instances we had a minute or less to ask them questions. I do not think that we were able to adequately explore any of the issues around the sale of Devco and the implications for the people of Cape Breton.

I am convinced that there was a Canadian solution. I know there was but the government for whatever reason did not seem prepared to look at that. I think it would have been humane and the right thing to do if the government had done something to offset the impact to the miners. That goes right back to 30 years ago when Devco was put in place. It was partly an effort to offset the human resources liability of the Dominion Steel and Coal Company that went bankrupt and had left miners without pensions, severance pay and all those things.

It was the government's responsibility, rightly so then as it is now, to wind down Devco. However, because of the commitment in the Devco bill that the government made to the people of Cape Breton, it would have been only right for the government to accept the human resource liability and offset it in whatever way it could.

In fact section 17 of the old act says that the corporation shall adopt all reasonable measures to reduce to the fullest extent possible any economic hardship or unemployment that may result from the closing of any coal mine operated by the corporation. The government of the day committed to doing that and that obligation is certainly upon this government to fulfil it.

Part of Bill C-11 is to eliminate that clause. If some time in the next months ahead we discover that the government sold the assets of Devco to an American company that closed the coal mines in Cape Breton, the government would be in breach of its own commitment, in fact in breach of the legislation that is in place today until this bill comes into force and that particular clause is eliminated.

I can understand why the government wants to remove that clause. It certainly would be liable if it did not. However, there were ways. The government has gone a long way through the injection of the money that the minister talked about for the economy of Cape Breton and the diversification of that economy. Those things could and should be done but that liability cannot be tied to the new owners of Devco. The liability of the miners, the families and the environmental liability of the Dominion Steel and Coal Company was what for so many years made Devco unprofitable. That was where Devco lost money.

We have heard members in the House, certainly the NDP members and others, say again and again that the coal mining operation of Devco was a profitable operation. It was mining coal at a price, when sold to the market that they had, where it was making money. It was the liability that the government had saddled Devco with so many years ago that made it unprofitable.

If the government intends to saddle the new owners with that liability I do not visualize anyone buying Devco. We will never know because it will be under the terms and conditions of sale. We cannot see the government insisting that the new owners of of Devco take on the responsibility for the human resources liability, such as the union contracts, the union liabilities and all the things that go with it, plus the huge environmental liability that exists there today. The minister did not talk about who would be responsible for the environmental liability.

I was down there. The liability cost of decommissioning the two mines, the coal wash plant and all the rest of it, not to mention the mess at the Sydney tar ponds and the slag pile from the Sydney Steel mills, is huge. There is no question in my mind that the people of Canada will be stuck with that cost. No company, either local, American or foreign, will buy Devco if it has to accept that liability.

Since we will be stuck with that liability anyway, why would the government not accept both the human resource liability and the environmental liability? It could then consider the local bids from the key people of Nova Scotia and Cape Breton who are willing to operate not only the Prince mine but the Donkin mine and perhaps even the Phalen mine. They could operate them locally, employ local people, sell the coal to Nova Scotia Power and use the international pier to feed extra coal into the export market. Cape Bretoners were willing to do that and this government would not even have a look at or accept their bids. That was wrong.

On that basis, there is no way that I can recommend to my party that we support the bill. It is not because we do not agree that coal mining in Cape Breton could not operate profitably under the private sector, and should operate under the private sector, but simply because of the way this deal is being handled, the secrecy surrounding it and the refusal of the government to tell the House and Canadians that it has at least made a commitment to the terms and conditions of sale and that whoever buys the assets of Devco has to operate the mine for a particular length of time.

I simply cannot support the bill and will recommend to my party that we vote against it, as I have at every other stage. I believe there is a viable coal mining industry in Cape Breton. There is a Canadian solution available that will put Cape Bretoners to work. The government has been negligent in not considering the Canadian solution, and that is a shame.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, we have just finished the report stage of Bill C-11. We have just voted on the various motions introduced by the New Democratic Party, and of course the people behind those motions were the hon. members for Sydney—Victoria and for Bras-d'Or—Cape Breton.

These amendments were given overall support by the Bloc Quebecois because they addressed certain elements affecting employees and former employees and their future.

We in the Bloc Quebecois agree with the principle of privatization even if, on occasion, the positions are not always readily obvious. On the one hand, we are told it is not profitable and that they want to sell it, and on the other that it could be privatized profitably, because the local people could operate it. This is a pretty unclear situation, and a number of questions need to be asked.

First of all, we know that the future of the coal industry is not clear. From the strictly environmental point of view, we know what results it can have. From the operational point of view, more and more people are trying to use alternative energies. There are questions to be asked about the coal industry per se.

But the minister tells us it is not cost-effective. Moreover the president of the Cape Breton Economic Development Corporation came before the committee to also tell us it was not cost-effective. So the question needs to be asked. If it is not cost-effective, if the government was not able to make it cost-effective when it was in charge, how can it manage to be so as a private enterprise? What is hidden behind all this? Is the government putting Devco up for sale merely to get rid of its responsibility?

One thing struck me in this matter. Since the government got involved in the Cape Breton Development Corporation in 1967, some $2.5 billion has been spent, in money for the coal division or the industrial development division or for investments already made or about to be made in economic development. This is a lot of money.

When the government got involved in 1967 and committed itself to spending this $2.5 billion, imagine the regional and economic development this sum could have provided had it not all been invested in coal alone.

In general terms, the Bloc Quebecois supports privatization, but also supports employee protection. We support almost all the amendments proposed, especially those of the NDP.

The Bloc Quebecois opposes all positions taken by the federal government, which meddles in areas of provincial responsibility. Clause 5 of the bill provides that, even if the federal government disposes of Devco assets, it remains responsible for all work related matters, including the CSST, labour standards and labour relations.

It is for this reason primarily that we cannot support the bill. Another reason is the government's refusal to support the NDP amendments. And we can see in this whole matter the government's inability to provide solid regional development for everyone.

The Bloc Quebecois will therefore vote against Bill C-11.

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

Mr. Speaker, I rise to speak to the bill at third reading, as I have risen to speak to it when it was introduced, as I have spoken to it in committee, as I have spoken to it at second reading and as I voted tonight on the amendments put forward by our party and by the Bloc.

I listened to the minister's words this evening. He approached the debate with a respectful tone. I think I should tell him that I know this has been a difficult process for him. It has not been an easy battle for any of us who have had to fight it.

There are some things however that need to be said and some items that need to be clarified with respect to the minister's statement.

First, he did come to Cape Breton in January 1999. Prior to his arrival, I wrote to him, the member for Bras d'Or—Cape Breton wrote to him, and the provincial MLA for Cape Breton—The Lakes and the current MLA for Cape Breton Centre, Frank Corbett, wrote a joint letter on, I think, December 31 outlining that we understood that the government was moving in a direction. There had been rumours of that and documents that subsequently indicated that this plan had been in place for some time. We wrote indicating we understood the complexity of this. I remember the letter because we said that the pension plans in particular had to be looked at carefully because the current formula would not be fair.

The government announced a package in January. I will not go through the history. I have spoken to this bill many times. I have spoken to it passionately, as the minister has acknowledged. However, the package that was announced in January was never changed.

The minister indicated that in January of this year the unions requested a joint planning committee. Indeed there was an illegal strike. The miners went into the mine and held up production. There was a question as to whether or not Nova Scotia Power would be able to provide continued power to Nova Scotians.

Only then did the government agree to the process that resulted in binding arbitration. That arbitrator's award subsequently said that the miners and the employees of the Cape Breton Development Corporation were shortchanged with the government's offer. They were entitled to more money and a different package. I think it is important to clarify that.

There are unanswered questions. This is unfinished business. The member from the Canadian Alliance referred to the question of the Donkin mine. Whether or not that mine will be subject to a sale remains unclear.

I heard today from people in my community and from miners who have lined up outside the general mining building requesting their severance package. They were told that they would not be eligible for a severance package because they would be in the workforce when the new owner took possession of the assets.

The member for Bras d'Or—Cape Breton and I attended the meeting with Nesbitt Burns held in the community and said that the men had been told they would get either a pension or a severance package or employment. We asked how they could guarantee employment.

There is still unfinished business. These men do not know if they qualify for a severance package, simply by virtue of the fact that they work for the corporation, or whether they have to hope there will be a job with the new company.

Other issues need explanation. In the middle of the provincial election campaign the Prime Minister of the country wrote to a woman in Glace Bay, Edna Budden, in a letter that she made public. This was in July and he said that she should not worry, that the government would review the package. He was confident that it would be improved.

That letter needs to be explained. It needs to be explained by the Prime Minister. It needs to be explained as to why it was sent and why the government only improved the package when it was forced to by an arbitrator. Those are unfinished pieces of business, which I suppose will be the job of historians to explain.

I feel tonight a bit the way I used to feel when I practised family law. Spouses would come to see me after a long marriage and say that they did not know what happened but the other parties were not interested any more.

A covenant was made in the Chamber 33 years ago, almost to the day, in June 1967. The then Liberal government made a covenant with the people of Nova Scotia and the people of Cape Breton, in particular through the Cape Breton Development Corporation, recognizing that the economy of Cape Breton had to be diversified.

These are not just my words. Let me read from an editorial in my community's newspaper this morning. It is entitled “The covenant is nearly at an end”. It talks about Bill C-11 and whether or not it will get through the Senate. It says:

Yet the Senate, that chamber of second sober thought, is perhaps the best place to debate the passing of the historic relationship between Ottawa and Cape Breton that has flowed in large part from the 1967 Devco act.

The arbitrator referred to the act and the historic covenant in his report. He quoted Jean-Luc Pepin. Ironically he quoted the New Democratic Party MP at that time for York South and a Conservative member. It is surprising that the Conservative Party voted in favour of this bill. Senator Bob Muir, who at that time was a member of parliament representing the mining community, and the New Democrats wanted the government to ensure employment for miners.

The government of the day said that it did not have to ensure that because of section 17 of the Devco act, which has already been referred to. I have referred to that section on numerous occasions and I do not want to use up my time saying what I have already said. It said that all reasonable measures to reduce as far as possible any unemployment or economic hardship that could be expected to result would be taken by the government.

After 33 years one of the parties to the accord, as in a marriage, came in and said it is tired of the covenant. They have been together through some tough times and some good times. Certainly the people of Cape Breton have supported the Liberals throughout those 33 years.

In 1995 or thereabouts the government began having second thoughts about the covenant. In 1999 it served notice. Like a divorce paper, the notice was delivered. The parties went to court through the arbitrator and an award was made. I have no question that the covenant will be broken tomorrow night when the House passes the bill and it goes to the Senate.

Those kinds of breakups are always hard because both parties have invested. The people of Cape Breton have invested heavily with faith in their government. The government has invested heavily in Cape Breton. I do not diminish that. Like the spouse who is tired, the government has said it is time for them to go their separate ways.

Unfortunately the people of Cape Breton are like the spouses that end up impoverished. They are the ones who end up without the house. The kids are gone. There is not money in the bank account. They are told to get by the best way they can. There is a $68 million alimony payment over five years to replace the $300 million in the economy.

I used to advise those spouses that they did have to get on, that there was no point in bitterness or that at the end of the day they would waste more time than they had already wasted. I refer to the same editorial where it says:

Section 17, which will be expunged from the amended act, sets out obligations to the workforce and the general economy in the event of coal industry downsizing or the closure—

Those words sound almost anachronistic in today's more Darwinian economic and political climate. Perhaps the words have become little more than empty marks on paper, but their official eraser from the law of the land should at least provide an occasion to pause and consider where Cape Breton goes from here.

I spent many hours on the floor of the House condemning the government for what it has done, but the editorial is right. We have to look at where we go. We are a tough people. We are proud people. We are people who will rise from this. We are a people who will move on. We are a people who will accept the challenge. I will offer to the government tonight some suggestions. I hope it listens because it challenged us from time to time to say what it should do.

The minister referred to the report tabled by the economic panel. The one thing I was waiting to hear, which nearly every group that presented before the panel talked about, was decentralization. We now accept that we are in a crisis. The government has walked away. I suggest the first thing the government should do is look at decentralizing some of the very wealthy departments that exist in this very wealthy city and move them to areas of high unemployment.

I had a motion in the House to that effect. The Standing Committee on Fisheries and Oceans has said that the department should be moved out of Ottawa to either coast. In an area of 50% unemployment it is time for the government to act on that recommendation.

There are other things the government could do. The Department of Citizenship and Immigration is currently in Cape Breton. It provides some spinoff economy. As has been referred to earlier, there is also a need for remediation work. The mines have to be remediated. That is a legal obligation on the part of the Cape Breton Development Corporation. The miners who are out of work or who will not qualify for pensions or benefits ought to be provided with an opportunity to remediate those mines. That will provide some lasting employment for those individuals and some training in that regard.

It has been mentioned that we have the Tar Ponds site. There is no better place in the country for a centre of environmental excellence than the island of Cape Breton. We are a beautiful island but we have environmental problems. I would ask the government to invest, if it is serious about its commitment, in the island of Cape Breton to create a centre of environmental excellence.

Other companies are looking at investing and growing the technology. Let us be clear that we have to clean up the environment or we simply will not have a world. There are sites around the world that need remediation. Cape Bretoners are hard workers. With the right training we could develop a technology that we could export around the world.

In the short term these would be most welcome announcements from the government: that it plans to decentralize, that it plans to set up a centre of environmental excellence and that is plans to remediate the mining sites. Indeed it has to remediate the Sydney Tar Ponds. All of these create jobs. All of these create knowledge. All of these create some wealth.

There is in my riding the Canadian Coast Guard College. It is a fact that there is currently in the law a requirement that everyone who ships oil on the ocean has to employ individuals who are trained in ocean cleanup. There may be one centre in the country where we can train people in that regard. The Canadian Coast Guard College on the ocean is a perfect place for the government to begin training individuals in ocean cleanup, in oil spills. That too could become a centre of environmental remediation for teaching individuals in that regard.

Cape Breton has a history of being an energy centre. I note that the Minister of Finance provided money in the budget this year for clean coal research and clean coal development. We have the miners. We have the coal. We have a history of providing energy. The government should invest and ensure that clean coal technology is developed in Cape Breton.

Cape Breton can also be a centre of sustainable energy development. In Europe, Denmark and Alberta wind power is seen as the energy source of the future. There are no greater winds than those that come off the north Atlantic. We could provide sustainable energy, not just for Nova Scotia but for much of the eastern seaboard.

Clean coal technology, wind power and environmental excellence would all provide opportunities. I have been asked to tour these plants. I am told that wind powered generator plants are like airplane manufacturing companies. There is all kinds of work for electricians, for the skills people in Cape Breton have developed working in the mines.

I spoke to the Minister of Natural Resources personally the other day. I commend him for finally appointing an arbitrator to help determine the dispute between Newfoundland and Nova Scotia in terms of who shares in the Laurentian offshore. There is a real opportunity, if we seize it and if the government assists us, to make a petroleum industry in Cape Breton. We should be the supply base for any kind of offshore development. The skills of the workforce of the Cape Breton Development Corporation would be best suited to do that kind of work. It is dangerous work we know, but we are up to the task. It requires training but we are intelligent. The sooner we can develop the Laurentian Basin, the sooner we can see some economic growth.

The minister mentioned high tech and the call centre. With the greatest respect, I was happy to see the announcement and I welcomed it but those 900 jobs would be considered in any other part of the country secondary income jobs. In terms of high tech, if what we can expect are call centre jobs, it is simply not enough.

There is the opportunity to develop tourism. This is my concern with section 17. Tourism has been touted as the windfall for Cape Breton Island. Yet it has been reported to me that ECBC, the economic development agency that the minister now says will take over what was once the role of Devco, has decided to go back to the basics of assisting manufacturing. It has cut the budget which assists tourism in Cape Breton considerably.

We have some concerns. Tourism is an area that we can develop but we cannot develop it without infrastructure money. There is no point in inviting people to Cape Breton if the roads they drive on around the Cabot Trail are full of potholes. There is no point in inviting people to come to Cape Breton if we do not have museums and cultural centres for them to visit.

I presented the government with a wonderful proposal from the aboriginal community in Cape Breton to create a centre of Mi'kmaq studies and history and culture. It would be built on the waterfront and would provide an opportunity to attract tourists.

Our cultural industry is second to none. We could develop what Silver Donald Cameron, a well-known writer from Cape Breton, calls Banff east. It would be my hope that some day that could grow to where we would refer to Banff as Cape Breton west.

We have produced some of the country's best writers in literature. Alister MacLeod has two books on the best seller list. He is considered a master craftsman. Out of Cape Breton have come some wonderful writers. Ann-Marie MacDonald's book has been quoted. There are many. Bryden MacDonald and Audrey Butler have been nominated for the Governor General's Award.

There are opportunities for Cape Breton. I will work very hard and I know the people of Cape Breton will work very hard to see an economic future for ourselves, for our children and for our grandchildren. We will do that with some mistrust of government. We will do that, although we are prepared to work with government, with some bruising. We will do that with some mistrust because a covenant has been broken. When it was broken we were left, in the vernacular, with the short end of the stick.

We are tough enough to rise to the challenge. We will rise to it. We will build an economic future, but the Government of Canada should be very reluctant the next time it reaches out to look for support from us, because we have given. We have given in two world wars, we have given in depressions, we have given to charities, we have given every time the nation has asked. We have given. Today we find the nation through the Government of Canada telling us it is time to separate. It is a sad day but we will get on with it.

[Gerald Keddy, Progressive Conservative, South Shore, NS]

Mr. Speaker, I rise to speak to Bill C-11, the Cape Breton Development Corporation divestiture authorization and dissolution act.

The government announced in January last year that it was going to sell the assets of Cape Breton Development Corporation which is more commonly referred to as Devco. The government stated that this decision was necessary for economic and financial reasons. Devco has not had a prosperous financial history having survived in some cases only due to subsidization provided by the federal government, subsidies that have culminated in more than $1.5 billion being spent in Cape Breton Island.

That sounds like a lot of money and I would certainly agree that it is. What that figure does not tell us is the peripheral effect that this money provided to the people of Nova Scotia and in particular to the island of Cape Breton.

At committee we heard from the mayor of the Cape Breton Regional Municipality, David Muise, and he put some of the figures into perspective for us. For instance, the federal government set aside $68 million for economic development when it announced the privatization of Devco. However, according to Mr. Muise the region will be losing $65 million in purchasing power and a loss of $1.5 million paid in lieu of taxes by the corporation. When we put that in perspective, the $68 million is not quite the figure it sounds like.

Other groups also told us about the hardship that the closure of the coal mines will have on the workers and their families. The Phalen mine was closed earlier than anticipated and no information is being released about the potential buyer for the Prince mine, but the federal government has optimistically said that there will be employment for 500 people. That leaves more than 1,100 people without jobs. Many of the witnesses before the committee questioned whether even those 500 jobs would be available.

Let me go back to what the mayor had to say at committee. He told us that his municipality is 2,600 square kilometres with a population of 117,000 at the last census, but it was losing young people at a rate of 1,000 per year. One thousand young people are leaving the municipality of Cape Breton per year because they do not see a future for them on the island of Cape Breton. The official unemployment rate is 20%, but the reality of that number is really much higher, some say as high as 40% and the poverty rate is 25%.

The economic reality facing the miners in Cape Breton is bleak. This was reinforced by presentations from groups such as United Families and Northside Future. It was also the reason I put forward amendments at committee to try and secure better pension packages for the miners and improve medical benefits for miners and families. Benefits are needed by miners who suffer from black lung disease, a condition that results from years spent underground breathing in coal dust. Neither of these amendments were successful.

I should make it clear that the Progressive Conservative Party supports the removal of the federal government from the coal mining industry in Cape Breton. At the end of the day the federal government should not be operating the coal mines in Cape Breton. The past history of the crown corporation clearly shows that the mines did not operate efficiently under government authority.

However, the government must assume its share of the blame for the failure of the crown corporation to fulfil its objectives. With all of the money that has been provided by the federal government for diversification in the region, there has been little success and far too much political interference.

When the crown corporation was established in 1967 it was clearly intended to help the region move away from its dependence on the coal industry. From the presentations that we heard at committee, it is clear that there is still a strong reliance on the coal mining industry for employment. It is also clear that the government has only paid lip service to helping coal miners without any real propulsion to effect change.

The denial of all the amendments at committee and again at report stage, some of which would really have improved this legislation and demonstrated a commitment by the federal government to help the people of Cape Breton, clearly showed that this was a political process.

At the same time one needs to be an optimist and believe the federal government when it says it will try to secure the best deal possible in the sale of Devco's assets and in helping some miners retain employment. It is easy to see why there is skepticism on the part of the miners, but they also know that there is more coal producing potential in Cape Breton.

Prince mine can produce one million tonnes of coal and there is a much greater potential in the Donkin mine if and when it is ever developed. The contract to supply coal to Nova Scotia Power will be a major factor in enticing a buyer while the coal handling pier and other properties of the corporation will be strong selling points and valuable assets to potential buyers.

There is opportunity for development of the Donkin mine and remedial work cleaning up some of the mine sites. The work ethic of the miners shows that the possibility exists for coal mine development, but coal mine development will not be the sole economic driver of the future of Cape Breton or Cape Bretoners.

There is very little information about potential buyers. The only thing known is that local bidders have not been included in the final process. Some of the best minds and entrepreneurs in the coal industry are not being included and given an opportunity to bid on the assets of Devco corporation. Instead it appears foregone that there will be a foreign owner operating the coal mines of Cape Breton.

I want to discuss the amendments that were presented. A number of positive amendments were put forward, ones that would have provided Cape Bretoners with a stronger voice and greater say in how the mining industry will operate in the region.

I put forward amendments to try to enhance the medical benefits for miners who have contracted black lung disease as a result of years spent mining coal underground. I also tried to improve the pension package, to extend it to miners with 20 years of service rather than 25 years and a total of 75 points as the government has intended.

None of the amendments put forward were accepted. The government members of the committee voted against every amendment without regard for the improvements they could have provided to this legislation. Amendments at report stage were also denied.

Last week the federally appointed arbitrator made his ruling public. Bruce Outhouse had been tasked with determining an equitable severance package and pension plan for the Devco miners. In his decision miners with 25 years of service regardless of age would receive early retirement packages. While he refused to accommodate miners with 20 years of experience, his decision will provide packages to an additional 246 miners and will add another $40 million to the overall package.

Mr. Outhouse declined to provide the same offer to miners with 20 years of experience on the basis that it would be too costly, requiring an additional $79 million. We continue to disagree with this aspect of his decision, but both parties went to binding arbitration in good faith and certainly we have to stick by the ruling that was brought down.

His ruling regarding health benefits also added support to changes that the PC Party has been trying to advance. Again the arbitrator ruled that medical benefits be paid to employees for the length of time they receive severance payments.

The medical problems confronting miners mainly result from years spent working underground and inhaling coal dust. It is only appropriate that medical benefits continue to allow these miners some security; otherwise health plans would likely be unavailable to them since it is difficult for anyone suffering from such ailments to successfully qualify.

A comment by Mr. Outhouse summarizes the difference between the way the government has handled this legislation and the sale of Devco's assets and the views of the PC Party. In defending his decision to provide early retirement benefits to all miners with 25 years of experience, Mr. Outhouse stated:

This is a substantial sum by any standard. However, I am convinced that anything less would fail to adequately reflect the long service of these employees and the difficult future which lies ahead of them.

This is exactly the point. The federal government has introduced the legislation that we are discussing here today to provide for the dissolution and devolution of Devco's assets. It has failed to take into consideration the lives of the people who are directly impacted by this decision. Rather than listen to the people of Cape Breton or to amendments put forward to improve the legislation, the government was signalling that it does not care how the people of Cape Breton cope with the loss of 1,100 jobs and how this will impact on the miners, their families and their communities.

The PC Party recognizes that the federal government's role in Devco has been extended beyond the point where it is financially feasible to subsidize the coal operations of Devco. However, the government could have decided on its own that it would provide a retirement package equal to those offered to other crown corporations when they were privatized. By failing to do so the government has lost credibility and demonstrated once again that it does not understand ordinary working Canadians.

I would like to mention the fact that committee and government parliamentarians were lobbied by many people from Cape Breton Island. Members from Cape Breton worked tirelessly on behalf of their constituents, as well as most of the critics for the natural resources portfolio.

I had the opportunity to meet a number of people, all of whom were here for the right reasons. They were all working for the betterment of Cape Bretoners. There are two people I would like to point out and make note of tonight. They are Edna Budden and Bev Brown of United Families. Although we did not always agree on every issue, they spoke from their heart and they worked tirelessly on behalf of Devco miners and Cape Bretoners, with no gain for themselves.

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

Mr. Speaker, I want to thank my hon. colleague from the Progressive Conservative Party for his wonderful remarks, but I have to ask him this question, with all due respect. I listened to him talk tonight about how he and his party recognized the implications, both social and economic, that Bill C-11 would have for miners, their families and their communities, and how he rightly threw bouquets to those delegations from Cape Breton who came here and worked tirelessly on behalf of their families. Could the hon. member maybe explain to me, my colleagues and all those miners and their families who are watching tonight at home why he and his party tonight at report stage voted with the government on Bill C-11? Could he explain that, please?

[Gerald Keddy, Progressive Conservative, South Shore, NS]

Quite easily, Mr. Speaker. It is very simple. The days of Devco have gone by. Cape Bretoners, Nova Scotians and Canadians cannot afford a crown corporation to mine coal at a loss any longer. It has to stop somewhere. It is stopping here. The government has made the right decision.

I do not agree with how it has implemented the decision. I do not agree with a number of things about it. We have tried to improve it and not just simply to provoke the government trying to get our name in the paper over it. We have tried to make legitimate improvements to this legislation. We have worked tirelessly to do that.

At the end of the day, when the sun is going down, there will be miners at work mining coal in Cape Breton. Prince Mine will continue to operate. Phalen Mine, I suspect, will be reopened in the upper collieries. There is still potential in Donkin, but there is no potential there if the federal government continues on that mine. There is no support from Canadians and the federal government cannot do it. It is time to move it on to private enterprise. It is time to dissolve and divest ourselves of our interest in Devco.

Quite simply, there other alternatives for Cape Breton Island. If we put the same money into Cape Breton Island that we put into the Devco mines, we would have a lot more than 500 or 600 people working there in the months to come.

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

Mr. Speaker, may I first say that I stand tonight not only on behalf of Cape Bretoners, but as a Cape Bretoner and a member of the community with a very heavy heart with respect to Bill C-11 and the implications it will have for my community, my constituents and a lot of my friends.

If I were allowed, and I know I am not, I would say it is unfortunate there are no government members here tonight. However, I know I am not allowed to say that.

[The Acting Speaker (Mr. McClelland)]

The hon. member, who is a very polished parliamentarian, knows full well that she cannot bring in the back door that which she cannot bring in the front door.