Debates of Feb. 9th, 2004

Canada Steamship Lines

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, the rules were not broken. It is extremely clear that the rules were not broken. There is a difference between the hon. member for LaSalle—Émard and the corporation.

When such a situation arises, the ethics counsellor must closely examine the facts. That is what he did. He concluded that neither the hon. member for LaSalle—Émard nor any of his associates had intervened. As a result, it is perfectly normal for the company to have access to government programs.

[James Rajotte, Canadian Alliance, Edmonton Southwest, AB]

Mr. Speaker, we know that her own department officials expressed concern about a conflict of interest with regard to this $4.9 million grant.

We now know that it was the ethics counsellor himself--it was not referred to the ethics counsellor--that pre-approved this loan for Canadian Shipbuilding & Engineering. He did not review it afterwards.

Why were the concerns of these public servants ignored by the industry minister in giving taxpayer money to the Prime Minister's companies?

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, it is quite normal for public servants who are considering a request by a company in which they know an MP holds shares to check very closely to see if the code of ethics has been followed, which is what they did.

And the ethics counsellor concluded that the hon. member for LaSalle—Émard did not intervene and neither did any of his associates. The ethics counsellor therefore concluded that there was no problem. And that is why we proceeded with the contribution.

[James Rajotte, Canadian Alliance, Edmonton Southwest, AB]

Mr. Speaker, the question was why the ethics counsellor gave pre-approval before the objections were even voiced to the industry department officials.

Moreover, we have learned that Technology Partnerships Canada was oversubscribed at the time, meaning it was short of funds at the time that this grant was approved.

Does the Prime Minister and the industry minister expect us to believe that no undue pressure was brought to bear in terms of giving this grant to the Prime Minister's companies?

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, no pressure was put on the public servants responsible for the program—not by the hon. member for LaSalle—Émard himself, nor by any of his associates. That is very clear.

All the facts were checked by the ethics counsellor, and the public servants acted in accordance with the rules of the program under the circumstances.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, in his 1994 budget, the Minister of Finance at that time said, and I quote, “Certain Canadian corporations are not paying an appropriate level of tax. Accordingly, we are taking measures to prevent companies from using foreign affiliates to avoid paying Canadian taxes which are otherwise due”. It was a fine objective that had no effect at all on the current Prime Minister, since he left a door open, that being Barbados.

Will the Prime Minister admit that, because of the loophole he left in place, a loophole tailored to fit his own company, CSL International was able to leave Liberia in 1995 and sail to another tax haven, namely Barbados?

[Ralph Goodale, Liberal, Minister of Finance]

No, Mr. Speaker. The argument with respect to the tax treaty with Barbados was made by the broad Canadian business community, plus a number of tax professionals, plus the government of Barbados. The argument dates back to the days of Barbara McDougall when she was the Conservative minister of foreign affairs, and even before that, all the way back to 1980. There was nothing peculiar about it at the time referred to by the hon. gentleman.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, that is an interesting answer. On the heels of the 1994 budget, when the Arthur Andersen accounting firm asked the federal finance minister if the tax treaty with Barbados was still valid, it received the answer, in July 1994, that the proposed change was designed so that a foreign subsidiary based in Barbados would remain eligible for an exemption.

In other words, the Prime Minister closed a number of tax loopholes but left one little gap through which his ship was able to sail, and that gap was Barbados. Will he please explain this?

[Ralph Goodale, Liberal, Minister of Finance]

Mr. Speaker, I am not sure the hon. gentleman would want to base his case upon Arthur Andersen.

In any event, the tax laws of Canada are not designed or created to be of a particular privilege or benefit to any one company. Indeed, the record of this government has been in the opposite direction: to close the privileges. That effort was led by the Prime Minister when he was the minister of finance.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, the difference for the Prime Minister is that under Bill C-28, his holding company, CSL International, was then considered a shipping company, even though the ships under its responsibility belonged to subsidiaries.

How can the Prime Minister say that Bill C-28 does not give an advantage to CSL International when this amendment allows him to repatriate money he keeps in Barbados without having to pay taxes to Canada?

[Ralph Goodale, Liberal, Minister of Finance]

Mr. Speaker, the hon. gentleman is just plainly wrong. Bill C-28 is irrelevant to a company like CSL.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, at the insistence of the current Prime Minister, Barbados was not withdrawn from the OECD list of tax havens until 2001.

Will the Prime Minister admit that during his first attempt in 1996, and then when Bill C-28 was passed in 1998, and later during the entire period between 1995 and 2001, CSL International truly benefited from the tax haven in Barbados, a tax haven that was denounced on the original OECD list?

[Ralph Goodale, Liberal, Minister of Finance]

Mr. Speaker, the tax relationship with Barbados dates back to 1980.

However the hon. gentleman will know that international business and taxation matters are hugely complex. What is needed to deal with them is a concerted international effort where countries cooperate together with each other.

That is why this past weekend I raised this issue with colleagues in the G-7, specifically with Secretary Snow of the United States and Horst Kohler, the managing director of the International Monetary Fund. We have agreed to work together to find sensible solutions in the international business community.

Steel Industry

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, Stelco Steel in Hamilton is in crisis. In fact, the whole Canadian steel industry is in crisis.

As finance minister, the Prime Minister could not get involved in steel tariff issues because he owned a shipping corporation. People are wondering why he is AWOL on the Stelco file.

Ship to shore, where's our Prime Minister?

Will the Prime Minister personally intervene to help our steel industry, or do his corporate ties get in the way?

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, let me make it clear to the members of this House that to date, Stelco has not made any formal request to the Government of Canada. The member's question is strictly hypothetical.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, that is enough to make anybody furious, especially people in Hamilton. That is the same kind of could not care less attitude we saw during the SARS crisis: that it has not done anything because no one has asked yet.

If Hamilton steelworkers want help, maybe they should fold their pink slips into little paper dolls, because that clearly gets the Prime Minister's interest.

Jack Layton, the leader of the NDP, asked a simple question and I will ask it again. Which comes first, Stelco or keeping CSL all in the family?

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, I think it is normal to require a little respect in the House when one speaks about another member of Parliament. That is a basic rule we all have to follow.

I would like to reiterate that Stelco has not made any formal request for help from the Government of Canada. The Prime Minister is far from being in conflict of interest.

Furthermore, I also wish to inform the members of this House that we are monitoring the Stelco situation very closely. We are in contact with all the caucus members from Hamilton, who are following this situation closely. We are in contact with our provincial counterparts. We hope that the company—

[The Speaker]

The hon. member for Medicine Hat.

Canada Steamship Lines

[Monte Solberg, Canadian Alliance, Medicine Hat, AB]

Mr. Speaker, the industry minister does not get it. Public servants were very nervous about signing off on the CSE contract. TPC was oversubscribed at the same time and the discredited ethics counsellor pre-approved this, the same ethics counsellor the government wants to get rid of because he has no credibility.

Does the industry minister not understand how all of this undermines faith in the government?

[Lucienne Robillard, Liberal, Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec]

Mr. Speaker, what the Minister of Industry does understand is that it is all very well for the opposition to protest loud and long, but they are far from having proof of even the slightest illegal or immoral act by anyone whatsoever in this government, including employees of Industry Canada.

The departmental employees followed the rules of ethics very precisely, which is why the ethics commissioner issued his opinion on access to the TSP program and all rules were followed.

[Monte Solberg, Canadian Alliance, Medicine Hat, AB]

Mr. Speaker, we have documentation showing that the industry officials involved asked repeatedly for some indication from CSL that no benefit would go to a member of Parliament. They never did get that. They never got it because the ethics counsellor intervened and said that it did not have to happen, the same discredited ethics counsellor that the government knows it has to get rid of.

When will the minister allow the government to get to the bottom of this and call a parliamentary inquiry so we can look at what has happened on this very disturbing file?

[Jacques Saada, Liberal, Leader of the Government in the House of Commons and Minister responsible for Democratic Reform]

Mr. Speaker, it is interesting to see this party calling for an ethics commissioner, when it voted against the bill when it was introduced.

I would also like to read the following:

Appearances to the contrary, the opposition has not produced one sliver of evidence pointing to any illegal or immoral action by the Prime Minister. All they have done is throw around some figures, dates, and references to coincidences and contracts, well sprinkled with disconcerting language... Regrettably, through this sneak attack, they have managed to raise doubts about the integrity of a man who does not deserve such treatment.

That is a quote from an editorial in Saturday's La Presse by André Pratte.

Government Contracts

[Leon Benoit, Canadian Alliance, Lakeland, AB]

Mr. Speaker, the new ethics commissioner will not be independent either, and we know that.

More Canadians will finally hear the truth about the actions of the government on the Liberal sponsorship scandal. However it will not be news to the Prime Minister because he signed the cheques and approved the spending. In fact, he was finance minister when Mr. Gagliano was here and he never once objected to the whole sponsorship mess.

Why is the Prime Minister waiting till he gets caught by the Auditor General? Why does he not recall Alfonso Gagliano today?

[Bill Graham, Liberal, Minister of Foreign Affairs]

Mr. Speaker, this matter was raised in the House on Friday and I replied then by pointing out that the Auditor General would be presenting her report to the House tomorrow. We will have an opportunity to examine it.

However, as I said Friday, the House can be confident that the government will take all steps necessary to preserve the reputation of Canada and our diplomatic integrity abroad.

[Leon Benoit, Canadian Alliance, Lakeland, AB]

Mr. Speaker, the current finance minister said that he was thrilled to have been given the most powerful of positions because it was the eye of the needle through which the rest of government passes. That is what he said.

When the Prime Minister was finance minister through the whole sponsorship mess, was he the eye of the needle through which the money passed or was he the funnel that distributed the money to his political friends?