Debates of Feb. 6th, 2001

Auditor General

[Stockwell Day, Canadian Alliance, Leader of the Opposition]

Mr. Speaker, that math is very scary. The Prime Minister says he has reduced spending 20% but the problems have increased. So with less money he is creating more problems.

The auditor general has some simple advice for the government: “Don't waste public money. Do nothing illegal. Act impartially, honestly and fairly”. The auditor general goes on to say that while these principles may seem self-evident, most of us would agree: “don't waste public money. Do nothing illegal. Act honestly”. Yet he goes on to say they are self-evident and not clear enough to have prevented breaches.

Would the minister responsible for HRDC tell us if she thinks these are fairly clear principles? If so, why does she not follow them?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I am very tempted to go through the list of all the things that were given to his riding when he was a member of the assembly in Alberta. Money was given to hair salons, Dairy Queens, limousine services, and even to a tuxedo rental company.

Government Grants

[Deborah Grey, Canadian Alliance, Edmonton North, AB]

Mr. Speaker, the auditor general says that—

[Some hon. members]

Oh, oh.

[The Speaker]

Order, please. It is difficult for the Chair to hear the questions and the answers, and I have to ensure they are in order.

[Deborah Grey, Canadian Alliance, Edmonton North, AB]

Mr. Speaker, these kinds of answers have nothing to do with the real problem. The auditor general says that new incidents keep cropping up. I asked the industry minister about one yesterday. He did not even know of this latest one.

He knows that Mr. Lemire and Mr. Pepin have been charged with fraud and theft in their handling of government grants in the Prime Minister's riding. They are also involved in a questionable Shawinigan scheme that allowed them to qualify for $600,000 more by using previous federal grants for seed money.

Something is wrong with that. The Prime Minister's chief of staff was warned in writing, yet the deal slithered through anyway. Has the industry minister contacted the RCMP about this? Yes or no.

[Brian Tobin, Liberal, Minister of Industry]

Mr. Speaker, on any matter that the RCMP should be involved in, the RCMP will have its own volition to take whatever action it deems appropriate.

[Deborah Grey, Canadian Alliance, Edmonton North, AB]

Mr. Speaker, surely the industry minister, if he has a handle on his department, would of his own volition have some problems with some of the things that have gone on for years, not only in this department but in many departments across the way, evidently with full sanction from the Prime Minister.

The fact that the industry minister has announced that he is trying to demand money back from Lemire and Pepin proves that there was impropriety with taxpayer dollars. That is why we sent these documents to the RCMP last December 8 as soon as this was revealed.

Why did the government make $600,000 available without ensuring that absolutely all criteria were met?

[Brian Tobin, Liberal, Minister of Industry]

Mr. Speaker, the member opposite keeps mixing up a variety of different files. It appears to me her only purpose seems to be to want to try to malign the reputation of people without proper examination of the facts.

The reality is that there was an overpayment which has been dealt with. Funds are now in the process of being returned by the agreement of all sides.

With respect to the RCMP, if the member has any evidence whatsoever that she thinks warrants an RCMP investigation, she should pass it on to the RCMP. If she is interested in justice, she should allow it to do its job before she attempts to carry on as she has, smearing on the floor of the House the reputations of many people. It is—

[The Speaker]

The hon. member for Roberval.

Cinar

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, in the resolution of a tax dispute, Revenue Canada has two ways of negotiating an agreement with a delinquent company. The first is through voluntary disclosure, where the error is admitted before it is discovered. The second is through a decision based on the discretionary authority of the Minister of National Revenue.

My question is addressed to the Minister of National Revenue. I am not asking for the confidential details of the agreement between Revenue Canada and CINAR, but can the minister confirm to the House that this agreement was indeed based on a ministerial decision taken by virtue of his discretionary authority?

[Martin Cauchon, Liberal, Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec)]

Mr. Speaker, I have said this several times in the House.

First, it is obvious that the Income Tax Act prevents the Minister of National Revenue from commenting on any individual file.

Second, there are many more ways of resolving files than those mentioned by the opposition member.

Third, the Minister of National Revenue must not get involved in any of the investigations being conducted by the department.

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, I have a supplementary for the Minister of National Revenue.

Since there are so many ways for the Department of National Revenue to arrive at a resolution, I ask him, without wishing to know the details of the agreement with CINAR, what method he and his department decided on to reach an amicable agreement with this corporation?

[Martin Cauchon, Liberal, Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec)]

Mr. Speaker, I will once again repeat what I said.

As the Minister of National Revenue, I cannot comment on any individual case involving the department. I think most Canadians appreciate this fundamental principle of confidentiality underlying the Income Tax Act. I think everyone here supports this principle.

Second, when investigations are under way, if there is a hypothetical reference to a particular case or to any of the cases that we may be processing, the Minister of National Revenue does not become involved. All files are handled by the department's investigators and they do an excellent job.

[Stéphane Bergeron, Bloc, Verchères—Les Patriotes, QC]

Mr. Speaker, it would appear that, under the agreement reached in December between CINAR and the Customs and Revenue Agency, there will be no proceedings in this matter.

However, La Presse noted this morning that the Minister of National Revenue, before his entry into politics, was associated with the law firm of Smiley, Cauchon, which specialized in copyright and credit arrangements in the area of film and television production.

Out of a concern for transparency, would the minister tell this House that he never had any professional link of any sort, prior to 1993, with CINAR, subsidiaries of it or companies or individuals connected with CINAR?

[Martin Cauchon, Liberal, Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec)]

Mr. Speaker, in tax terms, as the public knows, I cannot comment on a specific file, especially the file referred to.

Now, if we are talking about my situation when I was a lawyer, have I acted as the lawyer for the company being referred to, that is, CINAR? To the best of my knowledge, I have never been CINAR's lawyer, and I know that this has been stated publicly and that CINAR was approached on this.

I imagine that CINAR was approached on this question. But I, to the best of my knowledge, have never acted as counsel for CINAR, and, once again, I do not get involved in the investigations of Revenue Canada.

[Stéphane Bergeron, Bloc, Verchères—Les Patriotes, QC]

Mr. Speaker, I do not know if it was intentional, but the minister forgot part of my question about whether he had acted as the lawyer of any of CINAR's subsidiaries, or companies or individuals linked to CINAR.

That said, in this particular case, could the minister confirm for this House that he does not intend to grant any form of immunity once the current police investigation of CINAR or its former directors has been completed?

[Martin Cauchon, Liberal, Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec)]

Mr. Speaker, the answer is simple. The Income Tax Act is clear. There is a specific section on the matter of confidentiality.

I consider confidentiality one of the key elements of the Income Tax Act, and I intend to respect it, regardless of the number of questions I am asked on all of the files that may come before Revenue Canada. I will stand firm as the Minister of National Revenue on the matter of respect for confidentiality. The members of the opposition know that I cannot comment.

Employment Insurance

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, the auditor general has presented his report. Clearly, the employment insurance commission has no explanation of how it sets contribution rates. These high rates have helped to increase the surplus in the employment insurance fund.

Could the government explain what factors are used to determine contribution rates and why the rate is higher than the one proposed by the chief actuary of the commission?

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, the auditor general raised this question before the Standing Committee on Finance. The committee suggested that we review the rate setting procedure with regard to EI premiums.

The hon. member will know that the bill before the House actually proposes a two year review of the rate setting process. I am sure she will want it passed and that she will support it.

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, it is clear that the auditor general keeps raising it. So does the public but the government does not deal with it.

The unemployment insurance surplus has ballooned to a massive $30 billion and it continues to grow. According to HRDC's chief actuary, that is twice the reserve that is needed. The auditor general and all Canadians want to know why the EI bank account is so fat.

I ask the minister, how fat does the EI account have to become before she starts investing it where it belongs, namely on Canadians who want to get back to work?

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, I am pleased to remind the hon. member that every year since taking office the government has reduced employment insurance premiums. Today the savings to Canadian employers and employees is $6.4 billion.

I would like to add that in the House there is a bill that specifically deals with the auditor general's recommendation that we review the rate setting process. I again ask the hon. member to enjoin her party to get this bill passed very quickly so we can do just that.

Energy

[Joe Clark, Progressive Conservative, Calgary Centre, AB]

Mr. Speaker, my question is for the Prime Minister. It concerns the North American free market in energy, which he has discussed with President Bush.

Could the Prime Minister tell us whether that proposal includes water, and in any event, would he give a commitment to the House of Commons that before there is any serious discussions with the United States of America for free market in energy, that issue is discussed in the House and in committees of the House?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, energy is covered by the free trade agreement. There is nothing new to that. It is not an area of restriction. Canada sells a lot of energy to the United States, especially from Alberta. We profit a lot because we have a policy that permits us to export energy resources to the United States. I hope that the member from Calgary is not opposed to the fact that Canadians are selling energy to the American market.

Auditor General

[Joe Clark, Progressive Conservative, Calgary Centre, AB]

Mr. Speaker, I hope the Prime Minister will take a look at the question and answer, particularly those portions that relate to consideration in the House.

Let me ask him a question about the auditor general's report as it relates to crown corporations, particularly the method by which the boards of crown corporations are appointed.

The auditor general says that the bible that is used now is the worst model available. It is a model that allows patronage appointments by the Liberal government. He recommends that there should be a change that would rely more upon search communities.

Will the Prime Minister give us a commitment now that that kind of change in the appointment of members of the boards of crown corporations will be adopted by the government?