Madam Speaker, I will go on with my speech. This legislation will help credit unions, designate a financial services ombudsman, something the NDP has been asking for for a long time, and create a consumer protection agency, that is called the financial consumer agency. It will launch a consultation process whereby the banks could legally be forced to provide a low fee retail deposit account. This is a position we have held for a long time in the NDP; however, nothing will happen in the short term. The bill will formalize a process of collecting data on small business lending but will not expand the banks' business powers into the areas of auto leasing.
These are some of the positive things in the bill. There are also in the 900 pages many things with which we disagree. Among those negatives is the wide ownership rules which lead to the concentration of banking powers in the hands of very few individuals.
This provides too much power to the Minister of Finance. Unlike parliament, the minister would then have the final say in virtually every major change that dealt with financial institutions, including mergers, acquisitions, regulations and ownership levels. It also fails to provide a real framework of accountability between large financial institutions and their local communities.
There is no community reinvestment act similar to the one in the U.S. which works very well. There is no effective improvement in accessing basic banking services, especially in rural areas. There is no right to lifeline, no cost accounting and no effective way to stop bank branch closures. Banks are only required to provide a four to six month window of notice to close under the legislation.
There are no teeth for the independent banking ombudsman and it reduces requirements for small banks. The Office of the Superintendent of Financial Institutions has been given more powers to deal with the potential for increased risk in the system, but there is no guarantee that the OSFI would be able to use these powers effectively because of the complex structures introduced in the bill, for example bank holdings and new ownership regimes.
There is nothing on the control and regulation of high risk derivative products and off balance sheet liabilities or on new monetary policy tools for the Bank of Canada.
We have dealt with some of the positives and the negatives. We note as well that it is a highly complex 900 page omnibus bill which changes eight major financial industry acts and is probably the largest bill ever to come before a Canadian parliament. Its main thrust is to increase competition, foreign and domestic, and flexibility through deregulation and re-regulation.
The Minister of Finance is easing entry requirements in the financial services market. He is purporting to broaden the powers of financial institutions including credit unions, increasing the flexibility and the complexity of ownership regimes, and allowing access to the payment system by non-bank entities, for example insurance companies. The legislation also creates a financial consumer agency, an independent financial ombudsman.
Bill C-38, its predecessor, included cosmetic measures to improve access to basic banking services and guidelines for a bank merger review process which were made available with the bill but are not included in the current version of the legislation.
The New Democratic Party opposes the bill. We emphasize that there is some support, as I have indicated in my remarks. We support parts of the bill, including the modernization of financial services, expansion of powers to credit unions, a potentially better deal for consumers, a better competitive position for insurance companies, and status quo on the distribution of insurance and leasing.
We would support the bill at third reading stage if changes to the wide ownership rules were rescinded, if it provided for more power to the House of Commons to review megabank mergers and if the government adopted an effective framework of accountability among banks, their communities and fully regulated bank holding groups.
In conclusion, there is quasi-unanimity among major financial industry players to speed up the passage of the bill which has incorporated the majority of the MacKay recommendations and has virtually gone through an invisible committee of backroom lobbyists. Bill C-8 is a done deal which the government is selling as a progressive financial consumer package.