Madam Speaker, I will be speaking to Group No. 1. I take this opportunity to thank the members of the House of Commons finance committee for their constructive approach to this very important and very massive legislation.
I would like to comment on Alliance Motion No. 1 which deals with the reporting of the financial consumer agency.
I would point out that under Bill C-8, the Minister of Finance is responsible for the financial consumer agency of Canada. Reporting arrangements have been specified which would allow the minister to appropriately monitor the activities of the agency.
However, the bill currently contains a provision that ensures that the consumer agency will be fully accountable to parliament. In particular, clause 34 of the bill requires the minister to annually lay before each House of parliament a report showing the operations of the agency for that year and describing in aggregate form its conclusions of the compliance of financial institutions with the consumer provisions. The financial consumer agency of Canada accountability structure and government reporting requirements mirror those that are currently in place for OSFI.
The second motion in this group from the Alliance, Motion No. 13, deals with the Canadian payments system. The process for designating a payment system in the proposed legislation is very extensive and would require the minister to consult with payment system managers and participants before notification of designation.
It is not necessary to detail in legislation, as proposed in Motion No. 13, process issues that would likely be part of any consultation. It is likely that the minister would outline the public interest reasons for the possible designation during the consultative period. It is possible, but if the payment system manager and participants addressed the concerns of the minister, there would not be a need to designate.
I will go now to the motions presented by the member for Regina—Qu'Appelle, the NDP finance critic. Motion No. 8 concerns itself with bank mergers. I should make it absolutely clear to the House that the government recognizes the importance of the role that parliament can play in assessing the public interest impact of bank mergers in Canada.
That is why the merger review guidelines include referral to both the House finance committee and the Senate banking committee. Through the reports of these committees to the Minister of Finance, the views of parliament would be considered in reviews of large bank mergers in Canada. The report of the finance committee would be presented to the House of Commons.
The Minister of Finance, however, is ultimately responsible for the safety, soundness and efficient functioning of the financial sector in Canada. The ultimate decision regarding whether a merger is approved or not needs to rest with the Minister of Finance and should not be conditional on approval by a resolution in parliament.
Furthermore, the proposed change could seriously undermine the safety and soundness of the financial services sector. Since mergers involving troubled institutions would not require the special resolution, this would signal to Canadians that at least one of the banks involved is in financial trouble. This could lead to a run on either one or both of the institutions, which in turn could seriously undermine the public's confidence in the financial services sector and the payment system.
I will now go to Group No. 1, Motion No. 12, from the member for Regina—Qu'Appelle. The motion deals with adding a new clause that would require any regulations made under the new bill in a calendar year to be referred to a committee of the House, the Senate or both for a comprehensive review.
As members are aware, Bill C-8 is a significant legislative initiative that sets out in comprehensive detail the key policy framework announced in the government's June 25, 1999 white paper. Within this framework, there are authorities to provide flexibility to specify elements of the new regime in regulations. Any regulations proposed under this framework would be subject to the same rigorous oversight process that applies to regulations proposed under any other federal statutes.
The Privy Council Office will review the regulation to ensure that it is consistent with the objectives of the legislation and interested stakeholders will be given an opportunity to comment on the proposed changes.
A key component of this regulatory flexibility is that it allows the government to respond to rapid changes in the industry in a more timely way than might be allowed by a five year review of the legislation. The motion, as proposed, would negatively impact on this flexibility.
A yearly review of the regulations would create uncertainty for the industry as to any changes proposed by the government in a particular area. To the extent that the review created delays, the proposed motion could lead to regulatory initiatives not being completed in a more timely way than a full fledged legislative amendment. For this reason, the government does not support this proposed change.