moved:
Motion No. 14
That Bill C-8, in Clause 314, be amended by replacing lines 32 to 36 on page 478 with the following:
“entity,
(ii) the association is permitted by regulations made under paragraph 396( a ) to acquire or increase the substantial investment; or
(iii) the entity is an association and the investment is not restricted by regulations made pursuant to paragraph 396( d );”
Madam Speaker, I would like to speak primarily to Motion No. 14, which was put forward by the Canadian Alliance.
Let me preface my comments by saying that one of the things the government sought to do as a result of the MacKay task force, and indeed, one of the many recommendations in the MacKay task force, was to give flexibility or give provisions in the bank legislation to allow for the progressive restructuring of the credit union system in Canada.
We have met continually with the people from Credit Union Central, the credit unions out in B.C. and representatives of that group. They have told us that they are prepared to restructure their operations so they can expand their service to Canadians, so that in the event there are bank mergers of domestic banks and there is a perception that competition is going to be tough, they want to fill that void. In order for them to do that, they have to restructure their operations. They want to be able to bring more branches in under an umbrella type of structure. In order to do that, they need to have some flexibility.
I believe I am correct when I say that the 10-50 rule applies to credit union structures now. As I recall it, one can either have a 10% interest or a 50% interest only. I am sure that the parliamentary secretary will tell me if I am on the wrong track here, but I believe that is the gist of it.
What they want is to have flexibility on the participation between the umbrella group and the branches that would be operating under this new business structure. I know the parliamentary secretary is warm to this proposal by the credit unions and by Credit Union Central.
This amendment would in fact give the credit union parties looking for this change the flexibility to set up their new structure and the flexibility to fill the void in customer service at the ground floor consumer level.
I know that the secretary of state for banks and financial institutions knows about this desire on behalf of the credit unions. I am of the opinion that the government has perhaps said to the credit union people who have been talking about this that it does not have a problem with this but that perhaps the credit unions should show the government how to do it. The government has sought the advice of the people in the credit union structure.
This amendment reflects a suggestion by the credit union people to the government on how they can be given that flexibility. I will close here and just assume that the Parliamentary Secretary to the Minister of Finance will see the wisdom of this amendment and ask his colleagues to say yea when it is called.