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House of Commons Hansard #137 of the 37th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was c-48.


Veterans AffairsOral Question Period

2:55 p.m.


Claude Bachand Bloc Saint-Jean, QC

Mr. Speaker, last May, the Minister of Veterans Affairs announced a series of legislative and regulatory measures concerning the veterans independence program, among other things. Regulations passed quietly on June 18 exclude 23,000 widows from this program.

At last week's Liberal caucus meeting, the Prime Minister reportedly promised to go to bat for these widows overlooked in the June 18 regulations. Could the Prime Minister tell us today how he intends to correct this unacceptable injustice to women?

Veterans AffairsOral Question Period

2:55 p.m.

Oshawa Ontario


Ivan Grose LiberalParliamentary Secretary to the Minister of Veterans Affairs

Mr. Speaker, the subject to which the member refers is one that we have gone over and over in the House. Rather than exclude 23,000 widows, we added 10,000 within the budget at that time.

I would remind the member that the department looks after $1.6 billion a year in pensions and allowances to veterans. I know the member is not from the same generation that I am from, but I remember when a dollar was a lot of money, and $1.6 billion is a heck of--

Veterans AffairsOral Question Period

2:55 p.m.

The Deputy Speaker

The hon. member for Brandon--Souris.

AgricultureOral Question Period

2:55 p.m.

Progressive Conservative

Rick Borotsik Progressive Conservative Brandon—Souris, MB

Mr. Speaker, today I received a self-serving communications package from the Minister of Agriculture telling us how wonderfully he has been handling the BSE file, but hello? The border is still closed to live cattle. It is not open.

The agriculture committee was making arrangements to go to Washington. Unfortunately, the minister decided to cancel that trip. He made the chairman cancel the trip to Washington. I want to ask the minister, why is that? Is he threatened or is it the fact that he just does not like a proactive initiative?

AgricultureOral Question Period

2:55 p.m.

Portneuf Québec


Claude Duplain LiberalParliamentary Secretary to the Minister of Agriculture and Agri-Food

Mr. Speaker, the committee cannot go; however, I will ask the hon. member to check whether the Canadian Cattlemen's Association could have requested that the committee not travel to the United States.

Coast GuardOral Question Period

October 9th, 2003 / 2:55 p.m.


Peter Stoffer NDP Sackville—Musquodoboit Valley—Eastern Shore, NS

Mr. Speaker, last week at our fisheries committee the commissioner of the Coast Guard indicated to our committee that it is not the mandate of the Coast Guard to guard the coast. My question quite simply to the government is this: Who is guarding our three oceans and our Great Lakes waters at this time?

Coast GuardOral Question Period

2:55 p.m.

West Nova Nova Scotia


Robert Thibault LiberalMinister of Fisheries and Oceans

Mr. Speaker, the Coast Guard performs an admirable job in making sure that we have maritime safety, that we have pollution control, that we have aids to navigation, and that we serve as a platform to all federal agencies when they are in need. The Departments of Transport, National Defence and all the agencies combined contribute all the services required.

HealthOral Question Period

2:55 p.m.

Canadian Alliance

Rob Merrifield Canadian Alliance Yellowhead, AB

Mr. Speaker, the World Health Organization is preparing for another SARS outbreak this winter. The Naylor report said that Canada is not adequately prepared for a true pandemic. With the fall flu season upon us, the Naylor report urged Health Canada to issue national recommendations for SARS surveillance by next week.

Will these guidelines be in place and why have they not been here by now?

HealthOral Question Period

3 p.m.

Edmonton West Alberta


Anne McLellan LiberalMinister of Health

In fact, Mr. Speaker, I am fully aware of the recommendations made by Dr. Naylor. We know that influenza season will be soon upon us. We also know that there may be some confusion in the minds of Canadians around whether that which they are suffering from is influenza, or perhaps they might be concerned about SARS.

That is why we are working with chief public health officers and medical officers across the country to ensure that we have the systems in place, the surveillance systems and the data information and collection which will in fact ensure that we are protecting the health and safety of Canadians.

Business of the HouseOral Question Period

3 p.m.

Canadian Alliance

Dale Johnston Canadian Alliance Wetaskiwin, AB

Mr. Speaker, could the government House leader inform us as to what the business would be for the rest of the day, for tomorrow and for the week following?

Business of the HouseOral Question Period

3 p.m.

Glengarry—Prescott—Russell Ontario


Don Boudria LiberalMinister of State and Leader of the Government in the House of Commons

Mr. Speaker, I am very pleased to answer that question. I think it is an excellent question.

This afternoon we will continue with the debate on Bill C-48, the resource taxation measures. We will then turn to a motion to refer Bill C-38, the cannabis legislation, to committee before second reading. If this is complete, then we would follow with: Bill C-32, the Criminal Code amendments; Bill C-19, the first nations fiscal institution bill; and Bill C-36, the archives bill, if we get to that. There is some discussion going on about Bill C-36.

Tomorrow we will begin with Bill C-19, if it has not already been completed, and then go to Bill C-13. If we have not completed the list for today, we could as well continue with that.

Next week is the Thanksgiving week of constituency work. When we return on October 20, it is my intention to call Bill C-49 to begin; that is the redistribution legislation, for the benefit of hon. members. When that is concluded, we would return to any of the business not completed this week or reported from committee.

Thursday, October 23, shall be an allotted day. That is the sixth day in the supply cycle.

The House resumed consideration of the motion that Bill C-48, An Act to amend the Income Tax Act (natural resources) be read the third time and passed.

The Income Tax ActGovernment Orders

3 p.m.

The Deputy Speaker

I think a question from the member for Champlain was being answered. There are about eight minutes left in the question and comment period. The hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques.

The Income Tax ActGovernment Orders

3 p.m.


Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Mr. Speaker, before answering, I will go over the question of the member for Champlain.

Indeed, the debate is on a bill that would provide very large tax reductions to oil companies; these are huge amounts for an industry that is doing quite well financially.

I will remind the House of the magnitude of the profits. In its second quarterly report to shareholders, Petro-Canada said:

Petro-Canada announced today second quarter earnings from operations of $455 million, which include a positive adjustment of $96 million for Canadian income tax rate changes.

Thus, a single company got a $96 million tax reduction. Shell Canada got a $54 million tax reduction and Imperial Esso, a $109 million reduction. These are sizable amounts.

My colleague was asking what could justify such a bill. Is it to benefit western Canada?

I think that, generally speaking, no one benefits from such a situation, except the companies themselves. The consumer does not benefit, because we have not seen a reduction of the price at the pumps as a result of these tax reductions.

Consumers were not intended to benefit. Oil companies pocketed the reduction and I believe the answer to that can be found in the comments made by Mr. Neil Smith, a member of the Certified General Accountants' Association of Canada, who said, regarding the ways and means notice that resulted in the bill before us today, and I quote:

The release came on the heels of a significant lobbying effort by the resource sector for federal corporate tax rate reductions.

There were many statements. We know how things are within the Liberal Party of Canada. It lends a more attentive ear to people who contribute generously to its campaign. Eventually, they get rewarded.

The government is offering a tax reduction to companies posting huge profits. Such a reduction is hard to explain, especially when the federal government is saying: “We need money for health care, and the surpluses will certainly not be large enough to pay the provinces what we owe them.”

Oddly enough, on the one hand it does not have the $3 billion surplus it promised the provinces, and on the other it reduces taxes on oil companies by $250 million. Somewhere, someone is being inconsistent and lying to the people.

If the government really wanted to pay the provinces the money it owes them for health care, it would not restrict its ability to do so by decreasing its own revenues and giving tax rebates to oil companies, who really do not need them to survive. Nobody is worried about their survival and I believe they are in good shape.

It is a good thing they are doing well and it is only right that they pay their fair share of taxes since the public as a whole should enjoy the benefits of our natural resources. I believe the federal government's legislation is regressive and concentrates money in the hands of those who already have a lot. I believe this is unacceptable.

The Income Tax ActGovernment Orders

3:05 p.m.


Don Boudria Liberal Glengarry—Prescott—Russell, ON

Mr. Speaker, I rise on a point of order. Several officials, including those at the Table and perhaps yourself, have noted that when I gave my business statement and provided a copy, they were not the same. Just to correct the record, while I said Bill C-13 for tomorrow, that is not correct. It is Bill S-13 and the written copy I submitted said Bill S-13, respecting the census.

The Income Tax ActGovernment Orders

3:05 p.m.

The Deputy Speaker

I thank the hon. minister for that clarification.

The Income Tax ActGovernment Orders

3:05 p.m.


Serge Cardin Bloc Sherbrooke, QC

Mr. Speaker, I would like to ask a question of my colleague.

There are aspects of this bill that create a new tax structure in the resource sector, including with regard to the mining industry. We heard several colleagues talk about the environment.

According to my colleague from Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, how does the environmental aspect fit in with this government policy, which tends to favour the oil industry?

The Income Tax ActGovernment Orders

3:05 p.m.


Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Mr. Speaker, I thank the member for Sherbrooke for his question, which is indeed very relevant.

We are at a stage where the Minister of Industry must answer as to how he is going to implement Kyoto. Members opposite tell us that it is sometimes difficult to find the money. It will take more years to achieve the targets when a fundamental principle, called the polluter pays principle, could have been put in place immediately. Instead of giving tax breaks to oil companies, the government could have decided that the money from these taxes would be used specifically for the environment.

We would not have expressed all this criticism today regarding the fact that the money from the tax cut goes directly into the pockets of shareholders.

At a time when sustainable development is becoming increasingly important, the federal government is sending the opposite message to Canadians. It says that we should continue to do as we did in the past, look only at maximizing profits and not pay attention to how money is distributed within society.

The public may pass harsh judgment on this bill, which just looks like the result of intensive lobbying by oil companies.

The Income Tax ActGovernment Orders

3:10 p.m.


Clifford Lincoln Liberal Lac-Saint-Louis, QC

Mr. Speaker, this year there have been catastrophes of immense dimension in Canada. Forest fires of untold proportions raged throughout the summer in British Columbia and Alberta. We recently heard that the Ward Hut ice shelf off Ellesmere Island in the Arctic detached itself and broke up. This is an area the size of the island of Montreal which gives people an idea of its dimension. More recently in Nova Scotia, hurricane Juan created a path of tremendous destruction, uprooting trees that were 200 and 300 years old. What do those things have to do with Bill C-48? The relationship is simple; it is called climate change.

Yesterday during the vote on Bill C-48 my colleague from Davenport and I stood to vote against the bill. We did not do it lightly or lightheartedly. These were tough decisions which were not done joyfully. In fact we regret them intensely. However, as environmentalists, we feel very strongly that there is a total contradiction between the government's policy toward climate change and our commitments to the Kyoto protocol.

The objective of Bill C-48 is to further promote the non-renewable energy sector, mainly the oil and gas industry which is a huge contributor to carbon emissions. These changes directly contradict the recommendations of the OECD that preferential treatment for the non-renewable sector should be eliminated. The same recommendation was made in the 1998 report of the Minister of Finance's technical committee on business taxation.

The Department of Finance technical study dated March 3, 2003 justified additional tax cuts which led to Bill C-48. It is interesting to note that there was no reference at all to the environmental or social costs of extraction of resources.

I would like to quote some very startling figures. I can vouch that they are official figures. The Commissioner of the Environment and Sustainable Development stated that direct government spending on non-renewable energy has been $202 million a year. Over five years this amounts to $1 billion. Between 1998-2002, the oil sands tax expenditure was approximately $597 million, over five years. The oil and gas investment tax credit amounted to $128 million. Over five years this amounted to $640 million. Over the last five years approximately $2.9 billion has gone into subsidies to oil and gas, and Atomic Energy of Canada for nuclear power.

In 2000 the Commissioner of the Environment and Sustainable Development published a report on the energy sector. I would like to quote from section 3.86 in the conclusion of the report:

Two important ways to address climate change are using energy more efficiently and establishing a more sustainable mix of energy sources, which means a greater reliance on renewable sources. The federal government stated in its 1996 renewable energy strategy that it wants to increase investments in renewable energy. It has also said for many years that it wants Canadians to use energy more efficiently, and the Office of Energy Efficiency is currently promoting this goal.

It is also stated in section 3.68 of the same report:

The tax system does not give any preferential treatment to certain investments that improve energy efficiency.

In other words, we are loading the dice in favour of favourable tax treatment to the non-renewable energy sector, the fossil fuel sector, while not providing any favourable tax treatment to the renewable sector.

The same report mentions in section 3.36 the various types of federal support to the non-renewable industry the following:

Since 1970, the federal government has written off $2.8 billion of its investments and loans for energy projects in the non-renewable sector.

I repeat, $2.8 billion.

I get the very strange feeling that we are speaking out of both sides of our mouths. On one side we are talking about Kyoto and climate change, putting large amounts of money, $3 billion in the last two budgets, into energy efficiency, the reduction of fossil fuel consumption and a reduction of carbon emissions into the atmosphere. This is a good side of it. On the other side we are presenting Bill C-48 to promote the accelerated use of fossil fuel resources. It seems to me there is a total contradiction which I must say as an environmentalist I cannot support. In fact, this is exacerbated by the feeling that this is an industry with so much clout that it almost dictates policy.

The Prime Minister in relation to Kyoto wrote a letter to the oil and gas industry on July 25, 2003. One section of the letter states:

  1. Other environmental regulations: The “business-as-usual” reference for intensity targets will take into account future federal environmental regulations. A consistent approach across all federal policies will avoid imposing a greenhouse gas penalty on mandated actions to improve environmental performance.

This letter almost gives carte blanche to the fossil fuel industry to go ahead and continue putting out carbon emissions, that there will be a cap of 15% put on reductions so that it will not be too drastically affected and it will be able to certainly respect it. The feeling is that we are really saying one thing and certainly acting, through bills like Bill C-48, very much in the other direction.

My colleague from Davenport, who stood with me yesterday to show our disappointment, displeasure and disagreement with Bill C-48, was recently at the International Energy Agency in Paris. He asked a question about the state of the world's oil reserves. They told him that if no new reserves were identified, the mid-depletion point for oil and gas would be about 2020. Then there would be sufficient reserves for another 20 to 25 years. In other words, it goes to show that our oil reserves worldwide are being depleted at a huge rate, considering that transportation and all other uses of energy are multiplying manyfold.

In regard to gas, the answer regarding the mid-depletion point was 2020, another 20 or 25 years. We are talking about results and targets that will fall in the lifetime of most Canadians. This is not something that is one, two or three centuries ahead. The mid-depletion is there, next door, in a few year's time. The depletion point for oil worldwide might be 2050.

What conclusion should we draw from this? The conclusion we should draw is that we do not say let us not use our oil resources. Of course not. We have to and we must. At the same time we are saying to the oil industry and to the government, surely a slower depletion rate would be far better for our economy and we could keep our reserves longer. At the same time, it would open the way for parallel stream which we must push with far more vigour.

We need a parallel stream of renewable energies, such as wind, solar, biomass and cogeneration. While we slow down the depletion of our oil reserves, we accelerate the pace of our renewable energies. When the oil reserves are depleted in 25, 30 or 50 years, we will have a thriving renewable energy sector such as is in the making in places like Germany and Denmark where wind power has become a very positive, constructive and important fact of life.

The Danes have made a policy to replace all their coal and oil energy with wind power in 30 years. It seems to me that we have to embark on an overall strategy, 25 or 30 years along, to put the accent more on favourable tax treatment in favour of renewable energies and to disfavour the fossil fuel sector so that it depletes itself far more slowly. Rather, we are doing everything to accelerate depletion and are giving more profits, subsidies and incentives to the fossil fuel industry.

I would like to quote from a text from Foreign Affairs of July/August 2003, by three highly credible Americans: Tim Worth, president of the United Nations Foundation and a former U.S. senator from Colorado; Boyden Gray, partner of Wilmer, Cutler and Pickering and served as counsel to former president, George H.W. Bush, the present president's father; and John D. Podesta, a visiting professor of law at Georgetown University Law Center and was chief of staff to former president, Bill Clinton. I recommend to my colleagues to read this article which is entitled “The Future of Energy Policy”.

I will quote from it. It states:

The time has come to craft a long-term, strategic approach to energy. A central feature must be public-private coalitions for change that bring together business, labor and environmental advocates. The first step must be to focus on what is important and define what needs to be accomplished. Three far-reaching, 25-year goals encapsulate America's long-term interests and should guide its energy policies.

First, America should address its dependence on oil by cutting U.S. oil consumption by a third, setting an example for the rest of the world and breaking the grip of the global oil cartel. Second, to take on the dangers faced by the world's climate, America should cut its carbon emissions by a third as a stimulus to a two-thirds global reduction by the end of the century. Finally, the United States should develop, deploy, and disseminate clean energy technologies and institute trade policies that can increase the access of poor people around the world to modern energy services and agricultural markets. Such moves will improve the lives of billions of people, stimulate economic growth and create new markets for American goods and services.

In the course of this article, it points out that in regard to energy, of which we consume far too much, of the six billion people in the world, two billion do not know what electricity is. We just flick a switch and put on our lights. We just get into our cars and they go. Two billion people in the world do not even have electricity.

In closing, I would like to also quote from the same article. It states:

A strategic energy policy will unite diverse political constituencies and forge common cause among stakeholders that are often at odds. The environmental community's objective is not to shut down coal, it is to shut down carbon; zero-carbon coal thus is something to agree on. The automotive and oil industries' objective is to not to prop up dictators in the Middle East or to sully the natural world, it is to provide a return to their shareholders; making fuels, cars, trucks and buses that are clean and profitable thus is something to agree on.

Most of all, a collaborative strategic approach holds out hope for ending dependence on oil, eliminating excess carbon dioxide emissions, and providing clean and reliable energy services and agricultural opportunity to the world's poor. The result would be to “hurry the future” by unleashing a torrent of innovation that will stimulate economic growth, create new jobs, improve productivity, and increase prosperity and security for the United States and the world.

These same words could apply to us here. It is not through bills like Bill C-48 that we will achieve this. With great forethought, a strategic policy that will look ahead and base itself on clean energies while depleting our fossil fuel reserves, which we need, with far less speed will achieve this.

I hope that many of my colleagues will join us in voting against Bill C-48.

The Income Tax ActGovernment Orders

3:30 p.m.


Marcel Gagnon Bloc Champlain, QC

Mr. Speaker, I commend the member for Lac-Saint-Louis for his speech. Having served with him in the Quebec National Assembly, I know he has always been concerned about the environment. When he was minister of environment in the Quebec government, this really was an issue of concern for him.

I do not remember the exact figure, but at the Quebec conference that two ministers of this government attended, as well as other members and myself, World Bank specialists told us that the greenhouse effect was almost catastrophic around the globe. They mentioned that an incredible number of people on this planet did not know anything about electric energy and the member for Lac-Saint-Louis was said that also.

These people work with hard energy, like coal and wood, which explains why between 15 and 20% of the sun's rays are not reaching the earth on a whole continent. This creates major environmental problems, as the member for Lac-Saint-Louis also pointed out.

When I hear a speech like this one, or the one by the member for Davenport, I wonder how it is that we are studying such a senseless bill, one that is so remote from environmental concerns.

How is it that, in 2003, we cannot get any reaction from the government when we say that this bill has to be withdrawn? We have to take what is being given to the oil companies to do exactly what the member for Lac-Saint-Louis was proposing, conduct research on renewable energy.

I am asking the member for Lac-Saint-Louis what we can do together to get the government to take action along these lines.

The Income Tax ActGovernment Orders

3:30 p.m.


Clifford Lincoln Liberal Lac-Saint-Louis, QC

Mr. Speaker, a substantial amount of money, approximately $3 billion, has been invested in the Kyoto protocol.

What I disagree with is this obvious contradiction between, on the one hand, making huge investments in more efficient and cleaner energy sources and, simultaneously, on the other, adopting legislation such as this, which will invest $260 million a year for non-renewable energy sources. I cannot agree with this.

This $260 million per year is nearly the same amount that has been invested in wind energy over five years. Wind energy gets $260 million over five years, while, in one year, this bill will put $260 million in the pockets of companies developing non-renewable energy sources.

We have to go back to square one. We have to reinforce what we have already done extremely well, such as the government's climate change plan, in which substantial amounts were invested. An investment of $3 billion is a huge one.

At the same time, we must not undermine such efforts by doing one thing and then the opposite. That is my message.

The Income Tax ActGovernment Orders

3:30 p.m.

Canadian Alliance

Jason Kenney Canadian Alliance Calgary Southeast, AB

Mr. Speaker, I have enormous respect for the member who is speaking and I always respect members who decide to vote against their party, in this case, on a matter of principle. However I have a hard time understanding exactly what the principle is that the member objects to in this bill.

I understand his environmental concerns and his remarks about the energy industry. However I do not understand why he supports a two tier tax system, one for businesses in general and then a higher tax burden for the companies that make enormous investments, take huge risks, apply tremendous technology and employ hundreds of thousands of Canadians that work in the natural resources sector, which has been the heart of the Canadian economy all through our history.

Why does he support a two tier tax system rather than one which is equitable and does not pick winners and losers in terms of sectors of our economy?

The Income Tax ActGovernment Orders

3:35 p.m.


Clifford Lincoln Liberal Lac-Saint-Louis, QC

First, Mr. Speaker, I am not alone. The OECD itself has recommended that favourable tax treatment for the non-renewable sector should be eliminated. In 1998, the Minister of Finance constituted a task force on business taxation, which also recommended the same thing as the OECD. The reason we must have different types of taxation is that we have to look at other issues as well; we have to look at societal issues.

The fact is that climate change is a fact of life. Just this year, for people living in the west, the forest fires that raged were not just an accident of history. The Ward Hunt ice shelf, the size of the Island of Montreal, has detached itself from Ellesmere Island. It has broken down. That is not an accident of history. Hurricane Juan flew into Halifax, creating all kinds of damage.

There is climate change. It is a fact of life. What we have to do is, on the one hand, foster clean energy technologies. We are not saying to put penalties on the oil and gas industry, but the oil and gas industry is flourishing at this time and it does not need any new breaks. It does not need another $260 million a year.

We would be far better off to put that additional money into wind energy, where we put hardly any at all, only $260 million for five years, so that we develop a new stream of energy. Oil reserves, regardless of whether we like it or not, are resources that are going to be depleted.

I quoted the International Energy Agency, which my colleague from Davenport visited recently. It says that the mid-depletion point of world oil reserves is going to happen in 2020. Beyond that, the agency reckons there will be another 20 to 30 years of additional reserves and then there will be depletion unless we find new oil.

We need to start building another stream of energies. We do not say to shut off the oil and gas industry, very far from it. I realize that my colleague from Alberta has a vested interested in his province producing a resource that we need today and that we use today. And we are happy to do so.

At the same time, let us not give the industry additional treatment so that it benefits from additional breaks when the time has come to, on the contrary, put new money we might have into a clean energy stream. This is really what we recommend: a parallel stream so that when the oil energy resources are depleted in 20, 30 or 50 years, this other stream will be thriving.

At one point, coal was the big energy source. It was too polluting, so oil started to come on stream. At that time there was the same debate that is happening today. I have read that then people said oil would never replace coal, but it did. We have to prepare for the time when clean energy sources such as wind, solar, biomass and cogeneration will replace oil and gas.

The Income Tax ActGovernment Orders

3:35 p.m.


Brian Masse NDP Windsor West, ON

Mr. Speaker, I am glad to participate in today's debate on Bill C-48. I think it is important that we talk about the decisions made in the House which affect the actual economy of the country, not only in the short term but in the long term. That is what the bill is about. It is a very serious issue: a decision on how to spend our resources.

There is a series of things governments do to develop the strategies, the tools and the tool chest to move forward with pragmatic programs and services in developing the economy and our communities. Part of that is taxation. Another part is service fees. Another part is through assets we have acquired, and there is also revenue generation.

The bill is very important, because at a time when we are faced with so many different challenges and problems, we will witness anywhere between $1.4 billion to $2 billion in assets disappearing over the next five years. That revenue stream is so critical when we are missing the opportunity to participate in renewable forms of energy. Right now we are focusing on a tax cut for the oil and gas industry, and for others as well, but I will focus on that one. It does not take into account the planning that is so desperately needed.

It is frustrating to stand in the House and hear that there is not enough money for SARS, for the workers or for the economy in Toronto and other areas that were affected by SARS. Not just Toronto was affected. Tourism was affected in other places because they were tarred by the same image as Toronto. People thought all of Canada had SARS.

Then there are our war widows. Canada has 23,000 war widows and we do not have the resources to provide money for them, but we can have money designated as a tax cut for the gas and oil industry.

We all know about hurricane Juan in Atlantic Canada, forest fires in B.C. and Alberta, and BSE. They are all examples of very significant environmental issues that also require assets from the federal government, assets that have not been streamed to the people who need them.

But the government can find the time and the political will to move toward a tax cut to an industry that has serious repercussions on the people out there. It is a very good industry in the sense that all of Canadian society has embraced the oil and gas industry. We understand the effects it has. It has done some very positive things, but at the same time we are paying some prices. My community of Windsor and Essex county is. Because of environmental contaminants, many of them related to dioxins, toxic materials spewed out into the rivers and lakes causing environmental degradation and human health concerns, my community of Windsor and Essex country has some of the highest rates of cancer, respiratory diseases and birth defects.

Now here we are, giving an industry a tax credit when we know we still have some of the worst and dirtiest gas on the planet. I have used the example of the Oakville refinery. Petro-Canada is closing it down because it would rather produce dirty gas until 2005 and then import oil from Europe and distribute it under its flag. Even though it will be another company's gas, it will just re-brand it as opposed to investing in a plant to produce clean gas and energy products to make sure we have independence.

I believe that the recent Conference Board of Canada report card on Canada's health says a lot. The conference board itself is an organization that is not necessarily seen as being the most solid in terms of the environment. It looks at a multitude of different things. It very much takes a cautionary approach to the environment. The title of the actual Globe and Mail article about it was, “Canada's latest report card has disappointing marks”. I will quote a section of that article:

Compared with other leading industrial countries, Canada scores high marks on an economic front and does moderately well in areas of education and innovation. But its performance on a range of health and social measures falls short of many other countries and Canada is well down the list for its environmental efforts.

That is important to note, because right now we know that those social, health and environmental rankings can actually be improved with the movement to renewable energy, provided that we have the assets to do so. Without those assets, if we diminish our reservoir of capital and our ability to act, then we will have limited choice and limited options. I think a good example is the $250 million per year going into wind energy. That is deficient by far in terms of what we can achieve.

That is an interesting issue because when the wind energy project in Toronto was completed, it cost just over a million dollars for the actual wind generation capacity to be completed. However, it cost over $100,000 to ship that unit from overseas because we do not produce them here. There is an example to show that if we had an industrial strategy and a committed, strong sense of purpose and conviction on the part of the federal government, we could create that factory here in Canada.

We could create a commitment among provinces and municipalities and have other tax incentives that help consumers and help business by producing the renewable energy forms if we make it affordable. I believe that is where the incentive should be. If we really want to talk about how it can affect workers and how it can affect the economy, then this money could be used to lower other types of taxation, which we would all enjoy, and at the same time we could meet our national goal of Kyoto.

It is something that this country has put a stamp on in terms of the world. We were one of the last people to sign it. The government was dragged kicking and screaming into it by the Canadian public, but it was done.

We can actually be a leader. I think it is a positive thing to do, and not only for our current situation, because it gives hope and instills in people the idea that we can take control of our environment and have sustainability. We can also clean the air and provide an opportunity for our youth to have the things that we are so desperately losing. We are desperately losing in regard to some of the health factors and some of the pollution issues that we lack resources to fix. Once again, this is a significant loss to the federal coffers for an industry that is going to create some problems for all of us as its product is used.

That is something that I think is important to note. It is really critical when we have long term commitments to something that we have the resources. That is not happening with the government. I am concerned that the government will not follow through with the Kyoto accord in terms of providing the right resources to make it successful. This loss of revenue stream is very important.

I will return to the Conference Board of Canada and its spotlight on Canada and the environment as reported in the Globe and Mail . I note this in particular:

Canadians take pride in their country's beauty and resources, but have been “lulled into a false sense of security about the state of our environment”, the board says. Canada placed a dismal 16th among 24 countries whose data were examined.

“Yes, we have abundant resources...but we are not managing them well enough”.

That is the comment. I think that is clear. Because of the natural beauty we have in this country, the size of Canada, its diversity, not only of its people but its topography, and the ability to be on an ocean, on lakes, and in forest areas, I think we sometimes take for granted the things that we do not see.

This tax cut is for an industry which obviously has played a very pivotal role in creating jobs and in being part of the Canadian drive to be successful, but at the same time it has a byproduct that a lot of people pay a price for. That byproduct is the pollution that is created and affects human health.

Even the OECD has recognized that environmental pollutants and toxins and their effects on human health has become not only an environmental issue in itself but an economic issue. The OECD is actually rolling out some more policy platforms in order to have the confidence and also, more importantly, to address the issue. Quite frankly, an area like ours has the Great Lakes area of concern because of the pollutants and the toxins we have been subjected to. For example, that has caused a situation where we have higher rates of learning disabilities among children.

That ends up not only putting a health factor on a child, but it ends up putting a burden on the family to be productive in society. They have to deal more with those special family instances. If there are no social programs there because the programs have been cut back over the years, then it hurts their participation in the economy and it makes more people dependent.

We have to balance these things out. It is not about trying to gouge an industry. The industry has done well in getting support from the federal government over the years. It has had a successful history of lobbying for money and resources and actually was in a partnership as a crown corporation at one point in time.

That does not take away from the fact that we have to be able to mitigate the problems associated with it. That is what this money does. The money needs to be in the budget to mitigate those things. It is critical. The twilight of this industry is coming upon us. We cannot be burning fossil fuels forever. We do not have unlimited supplies, so we have to introduce more and different technologies.

Ford Motor Company was on Parliament Hill today showcasing its Ballard hydrogen fuel cell technology at the front doors of this building. That takes a commitment of resources from the government. A federal green auto strategy would be one of them. We just cannot do that without money.

If we know this situation is developing, we have to reintroduce new sustainable products that will offset that. Oil and gas is a very critical issue. We have discussed this issue at the industry committee. It is not a situation where we have an option about purchasing the product. Most people have to use this product in their daily lives, to commute to work, to do social activities or whatever it might be. We have a dependency on this product. It is part of our lives. It is part of our culture. If we do not introduce something else, or do not work toward that, we are going to be very vulnerable as a nation.

These funds that are being cut are going to jeopardize those opportunities. This is important to know because this is not like any other product; it is very different because of our dependency.

We all know the stories about gas prices going up. When I was a municipal councillor and gas prices went up, we did not have the money in our budget to pay the difference. Where could we get that money? We had to either tax more or cut other programs.

If we do not invest in a multitude of different environmental projects on sustainable energy, we will make ourselves more vulnerable to those fluctuations. Those fluctuations not only hurt municipal governments but they hurt businesses that need a sustainable price in order to predict what their costs are going to be. Reducing these tax measures in our budget will make us more vulnerable by not having the necessary consistency.

The Kyoto accord is tied to this. We send a poor message when we say that we are going to reduce our emissions, that we are going to look for cleaner fuels, but at the same time we say that we are going to reduce taxes on this type of industry which is going to have an impact.

We need funds to develop the alternatives, like a job to job transition strategy so that workers who are affected by a decline or changes in the industry will have other jobs, employment training, programs and services to make that transition. We need to have urban transit alternatives to ensure that we have mass scale transportation in the future. We need to plan for the proper infrastructure because this infrastructure takes decades to develop.

Our transit systems used to use electricity. The transit systems still in use in Toronto to a certain degree operate on the electrical grid but it was more commonplace before. In fact the city of Windsor had the first electric street trolley. Ironically the oil and gas companies actually purchased a lot of those systems and eventually put them out of business.

We need green tax reforms. We need incentives so that consumers can purchase products with reduced taxation. We need incentives that will get the cleaner technologies on the streets so people see those things. We do not need a big bureaucratic structure. What we need is a reduction in taxes or an elimination of different services.

We need to facilitate the introduction of green products into society. Another good example would be the home wind energy products. There are solar powered shingles which are not affordable right now because they are not in mass production. I believe these revenue streams should be dedicated to lowering those costs so consumers can get them on the street and they can make a difference.

We have done that to some degree with automobiles. Provincially there was a tax rebate for cleaner technology, hybrids. It is not enough because there is still about a $5,000 difference in price for a cleaner vehicle, so it is not close enough. We have to narrow that gap. How do we narrow that gap? We need to have resources.

That is why we should kill this bill. We should stop it from going through. We should send a message that these revenues will go to building a sustainable economy, one that is healthy. In that way we will send a positive message to the world that we are moving to cleaner technology.

The Income Tax ActGovernment Orders

3:55 p.m.

Oak Ridges Ontario


Bryon Wilfert LiberalParliamentary Secretary to the Minister of Finance

Mr. Speaker, I understand the member's concerns and I share many concerns with regard to the environment. However, this bill deals with taxation.

The fact is that his New Democratic friends in the province of Saskatchewan, where the oil and gas and the potash industries are, will benefit from this. His NDP cousins in the province of Saskatchewan support this legislation. The working people in Saskatchewan, many of them in these industries, will benefit because of this legislation. Here an NDP member is standing up and saying we should scrap the bill.

The member talked about the environment. In fact, this bill will assist. As I said this will put the non-renewable energy sector on the same plane as others. The fact is we are doing lots with regard to the environment but this is not the forum, I would say with due respect to the member, as this bill deals with taxation issues which are going to put our mining companies and our oil and gas companies on an equal footing.

I point out to him that with respect to the Kyoto commitment, the oil sands industry will be called upon to make significant contributions to a 55 megatonne emission reduction target through the large industrial emitters program. It goes on. He knows about the $2 billion commitment of the government on Kyoto, et cetera.

The reality is let us not mix apples with oranges. This is a taxation bill. It is going to benefit provinces like Saskatchewan. I assume that he has not talked to his colleagues in the province of Saskatchewan because they support this bill and so do other provinces. I talked about that before. I would like the member to comment on that.