Mr. Speaker, earlier today when I was preparing for my duties as I have the responsibility for House duty for our party, I was not informed that I would have to speak to this bill but I believe it is imperative that I do so. The bill before us contains over 900 pages. It is of critical importance in terms of updating the banking industry within the country.
Mr. Speaker, you have been watching the debate. I find it hard to believe that over the course of the day the government has put forward only one speaker for one of its bills, a bill that has in excess of 900 pages. When I think that through, it is another signal of the arrogance that the government has for this place and for the democratic process.
The majority of these 900 pages is technical in nature. Very little vision is included within the bill. The bill is not a signal of a fundamental direction that the government wants to take the country in with respect to financial institutions. It is a housekeeping bill.
I know from my critic position on the environment that the government has been in place for over seven years and has yet to pass an environmental initiative of its own. We should not be surprised that the government really has a very empty legislative agenda before Canadians.
We heard that the Prime Minister would like to go to the polls sooner than later, but he cannot find a reason to do it because he does not have anything that would strike the interests of Canadians in order for the Liberals to be returned to another majority government.
I remember when leadership was commonplace by the Government of Canada. My first thoughts are the issue of free trade. Many members across the way actually opposed that initiative in 1988. That bold initiative transformed the country. Our trade with the Americans at that time was at about $90 billion. Today, compliments of free trade and its successor, NAFTA, trade with our American cousins is $320 billion a year. That was the kind of initiative and vision that was taken by a government that knew Canada needed to maintain its competitiveness in this increasingly global world. In contrast, when I look at this particular act it is merely housekeeping.
There are five basic principles that are going to be covered in this bill: the promotion of efficiency and growth within the financial institution sector; measures to empower and protect consumers; initiatives to encourage further domestic competition; the regulatory environment within the financial institution sector; and finally, the bill provides for a five year review of the legislation, as has been the case in the past. Those are the five points we are going to review.
One of the very contentious issues that was brought forth about financial institutions is that it would be permissible for a single shareholder to own as much as 20% of a financial institution as opposed to only 10%. To some individuals that is a major problem but to me it is a reflection of what is required to spur more competition and to bring more individuals within the financial sector.
I think everyone knows that bashing banks is a very popular function. We also know that they have achieved their solid performance and their strength within our society because of a protected environment which we fostered and nurtured over a number of years. At the time that was probably the best financial policy for us to have to ensure that we had a solid sovereign banking system. We only have to look at the commodity crash and the financial institution crash that took place along the Pacific Rim three years ago and what happened to its financial institutions.
Today we have more deregulation. Foreign competitors can come in and offer products to Canadians. The more competition there is, clearly the better.
However, we need to afford the banks an effective way to be able to defend their position within our economy. When people see the record profits in terms of what the banks actually bring in, it is healthy to keep this in perspective.
My learned colleague, the hon. member for Brandon—Souris, who is our party's new finance critic and temporarily replacing another very learned finance critic, Scott Brison, the former hon. member for Kings—Hants, pointed out a very unknown fact. One in two Canadians own a bank share or bank stock. It may be through owning the exact share on a direct basis. It may be through participation in a mutual fund. There is a virtual array of stocks in numerous funds of that nature. It could be due to the fact that they are a contributor to a pension plan. Pension plans invest heavily in our banking institutions.
The return on investment is not exorbitant for banks when we look at the size of the financial institutions themselves. The ROI for banks may not be much greater than a lot of other successful companies on a percentile basis, but the record profits that show up are related to their actual size.
There is one comment that was brought forth by our cousins in the NDP. Usually when it comes to money issues, financial initiatives and issues related to taxation or the like, I disagree with the socialist wing of the House on almost every single occasion, with the exception of what was brought forth in the comments made by the hon. member for Vancouver East. She touched on something very appropriate, that we need to ensure that banks must open accounts for any individual to cash federal cheques for non-customers, provided that identification is provided. A minimum deposit and employment cannot be a condition of opening an account.
We see discrimination of Canadian citizens who are indeed at lower income levels. The more we can do to ensure that the banks do their part and that they are much more welcoming for individuals of lower income, the better. Banking institutions have to be open to all individuals. The comments made by the hon. member for Vancouver East were dead-on on that aspect.
This is an initiative to ensure that the banking institutions modernize and recognize the very fact that how we bank today is drastically different from what we did only five or ten years ago, even only two years ago. I suspect many members of the House now bank via the Internet. I started to do that about six months ago. We pay our banks en masse through telebanking. We use ATMs to do the majority of our banking functions. How we deal and interact with our banks has changed. That is why it is imperative we have legislation which reflects that reality.
We also have to understand that the government has missed out on one aspect in particular. That is with respect to how it would potentially deal with the issues of mergers. There was the fracas when the finance minister claimed that he learned the Royal Bank of Canada wanted to merge with the Bank of Montreal over the news while he was brushing his teeth or while he was drinking his morning coffee and reading the newspaper that day. This finance minister has probably been the most connected to Bay Street in the history of Canada, yet he was not plugged in enough to be able to know what was going on in the financial sector. To be quite honest, I find that very hard to believe or an incredible event.
The finance minister missed an enormous chance to upgrade the financial institution sector within Canada during the merger debate. I remember the CEOs of the Royal Bank, the Bank of Montreal, the TD and the CIBC were willing to make blood promises in terms of how this would benefit Canadians to permit the merger process to proceed. I am not advocating a position by any means on whether to permit the mergers at that time was right or wrong. However, it was definitely wrong to cut off discussions at that point in time.
For instance, they were willing to make a blood promise on maintaining the number of rural banking institutions. They were willing to make a blood promise in terms of increasing and augmenting the risks of lending funds to the small business sector. I remember reading that they were willing to make another blood promise in terms of holding the line, if not rolling back, en masse, service charges to customers.
Whether those blood promises would have been in the best interests of Canadians or whether to permit the mergers are questions that Canadians and legislators never had a chance to publicly debate because the finance minister chose to be a populist. He said that banks were unpopular. He was not going to proceed to give them anything because it may jeopardize his leadership aspirations down the road. I suspect that was likely the greatest issue during the debate at that time.
We are here to talk about improving and modernizing the banking sector, the financial institution sector. I hope we see legislation in the near future that will augment and increase the fundamentals of the economy. If we look at our rates of taxation, Canada has the second highest corporate tax rate as a per cent of our economy of all G-7 nations. We know that as a per cent of our economy our personal income taxes are the highest of the G-7 nations. We also know that as a per cent of our economy, the dollars we spend paying down the interest and not really addressing the national debt is an immense drain on our economy.
Instead of a 900-page bill, which the government does not care to have its members defend or even talk about its attributes, I would like to see some vision to get our economic fundamentals in order. Let us do what the Progressive Conservative Party has advocated and pay down our national debt in a legislative way. We need to lower taxes.