House of Commons Hansard #55 of the 38th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was trade.


Department of Foreign Affairs ActGovernment Orders

12:45 p.m.


André Bellavance Bloc Richmond—Arthabaska, QC

Mr. Speaker, it is precisely the member's arguments that lead me to believe that we should not divide the department in two. He is well positioned to know that the influence that a country like Canada can have in a country where either democracy, human rights, the environment or labour rights are trampled relates to the fact that the foreign affairs and international trade departments are intertwined. He himself recently went to Ukraine, where many events occurred.

In exercising this influence, when our leaders discuss trade with leaders of other countries, these discussions are an integral part of everything related to labour and human rights. A country that intends to trade with a country like Canada must, of course, not only listen to it, but also make compromises. It must also prove that it is able and willing to change its approach toward human rights, the environment, social rights and so on.

I do not understand my colleague, who thinks that dividing the department in two can be beneficial, when his own Minister of Foreign Affairs did not manage to convince us.

Department of Foreign Affairs ActGovernment Orders

12:45 p.m.


Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

Mr. Speaker, is not the particular case of Ukraine a perfect example of the way we should be approaching developing democracies, developing civil societies in the world?

There was absolutely no question that it was an issue of trade or investment. We looked to our allies to work together with them, but we took on a leading role. We took on a leading role because Canadians expected it of us. They expected us to stand up for Canadian values, values that we believe in, democracy and civil society.

There are other examples perhaps of when trade or investment influence our foreign policy in countries that have developing democracies or civil societies. I am not convinced that it is the Canadian values of democracy and civil society espoused by foreign affairs that take precedence at all times when the two departments work together. They should be separated. Foreign affairs should lay the groundwork and make sure that when Canadians become interested in investment and trade that we do it with countries that we have helped along the path of democracy and civil society.

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.


André Bellavance Bloc Richmond—Arthabaska, QC

Mr. Speaker, I still do not understand the reasoning of my colleague opposite. The situation in Ukraine or the mission in which my colleague from Rosemont—La Petite-Patrie, as well as the colleague opposite, took part was under the aegis of the current Department of Foreign Affairs. However, I do not understand what went wrong in this mission, when we have the department that is there now. Again, we simply fear that, if the department is divided in two, trade will trump democratic rights.

So, on one side, there will be rhetoric, for example, by the Minister of Foreign Affairs, who will talk about the right to democracy.

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.


Pierre Paquette Bloc Joliette, QC

He is good at that.

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.


André Bellavance Bloc Richmond—Arthabaska, QC

Yes, we can proudly wear a flower in our lapel for saying that the right to democracy in Ukraine, or elsewhere, is paramount.

On the other hand, the Minister of International Trade will not need to make those speeches. There will no longer be a need to be consistent in our decisions, since the two departments will be separate. Trade will prevail over the right to democracy, in spite of the rhetoric.

But therein lies the danger and I will say it again: I ask my colleagues to pay close attention to this bill, lest it happen. We must simply vote against it.

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.

Pickering—Scarborough East Ontario


Dan McTeague LiberalParliamentary Secretary to the Minister of Foreign Affairs

Mr. Speaker, it is interesting that the members of the Bloc keep talking about human rights and poverty. They point out the areas they want us to focus on. I find that interesting, but at the same time, they do not see that there is a reality where there has to be a division between trade, our statements and our foreign policies.

What they are asking for is a little like saying that because of the Wal-Mart situation maybe the province of Quebec should have its industry department connected with its labour department. The fact is there are many opportunities for our government and the Canadian people to interact, whether it is immigration, cultural exchange, defence, when it deals with things such as helping the world.

Where was the member when the discussion was about Haiti and Darfur? Where was the member when we considered Rwanda? Will he not agree that there is a trade issue, or rather—and without exception—a foreign affairs issue?

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.


André Bellavance Bloc Richmond—Arthabaska, QC

Mr. Speaker, where was the parliamentary secretary, a few weeks ago, when we were in Davos talking about international trade? As it turned out, we talked about human rights and the environment. I am still not getting the rationale behind this. This department was put together some 30 years ago and changes were made over the years. The concept of putting international trade and foreign affairs under a single department came up under Pierre Elliott Trudeau.

And now, we are being told that this department should be split into two, but we still are not convinced. As I mentioned earlier, even the foreign affairs minister is not convinced that this is justified. We are still trying to be convinced, but I think that, on this side of the House, it is a lost cause. We are still not convinced.

Department of Foreign Affairs ActGovernment Orders

12:50 p.m.


David McGuinty Liberal Ottawa South, ON

Mr. Speaker, I am honoured to be able to contribute to the introduction of Bill C-32, an act to amend the Department of Foreign Affairs and International Trade Act and to make consequential amendments to other Acts.

I think that this measure will definitely help Canada produce a more balanced and more consistent foreign policy as we enter the 21st century and will thus ensure a more certain and more prosperous future for all Canadians. I agree with my hon. colleague, the parliamentary secretary, and I invite all members to support this bill.

I have no intention, of course, of repeating the minister's remarks; rather I will describe the proposed changes in more detail and provide some context.

As has already been mentioned, a year ago the Governor General signed an order in council separating the Department of Foreign Affairs and International Trade into two distinct departments. The order in council created the two departments and integrated them into the legislative framework governing all departments.

The order was made under the Public Service Rearrangement and Transfer of Duties Act, which enables the governor in council to transfer any portion of the public service and powers and duties from one portion of the public service or from one minister to another. This act also gives the governor in council the power to reorganize the administration, which is essential to give the government sufficient latitude, but not the power to give or increase powers without the prior approval of Parliament.

The bill at hand only codifies the changes to the operations of the former Department of Foreign Affairs and International Trade in accordance with the order in council regarding the Department of Foreign Affairs. In actual fact, the Department of Foreign Affairs and the Department of International Trade have been operating as distinct entities for nearly a year.

This bill is being studied in parallel with the bill creating the Department of International Trade. That said, I shall limit myself to a brief review of the amendments it proposes to make to the Department of Foreign Affairs and International Trade Act.

Bill C-32 simply gives official status to the responsibilities given to the Minister and Department of Foreign Affairs by the December 12, 2003, order in council. Broadly speaking, the proposed amendments to the Department of Foreign Affairs and International Trade Act consist in erasing references to international trade.

Because of the creation of the Department of International Trade, the reason for these changes is obvious. Therefore, the Department of Foreign Affairs and International Trade Act will become the Departmentof Foreign Affairs Act and the Department of Foreign Affairs and International Trade will simply be called the Department of Foreign Affairs.

The changes will allow the minister and the employees of the department to use the new name in their official and legal correspondence.

The bill confirms that the Minister of Foreign Affairs will remain the head of the department whereas any mention of the Minister of International Trade as additional minister will be removed. However, it still mentions the Minister of International Cooperation, who supports the Minister of Foreign Affairs in his duties concerning Canada's international relations and has access to the services and facilities of the department.

However, there are now only two foreign affairs associate deputy ministers instead of three, the minister having the power to appoint one of them as deputy minister for political affairs. The bill eliminates reference to the associate deputy minister for international trade, which can now be found in the International Trade Department Act.

The powers and duties of the Minister of Foreign Affairs remain unchanged with the exception of his responsibilities over international trade which will now be under the purview of the Minister of International Trade.

For example, the section which describes the duties of the Minister of International Trade is totally removed as is the mention of international trade development. I want to underline that the international economic relations coordination function has been changed to reflect the general mandate given the Minister of Foreign Affairs in the administration of the foreign policy and the coordination of international relations.

Of course, the bill stipulates that the Minister of Foreign Affairs will no longer have the power to develop or implement trade development programs. The bill also adds on a section on allocation of funds stating that the funds authorized by Parliament for the Department's capital expenditures that are not used before year-end become obsolete at the end of the following year, unless otherwise stated in an appropriation act.

It goes without saying that the bill also provides for the addition of the Department of Foreign Affairs to the schedules of the Access to Information Act, the Financial Administration Act, the Privacy Act and the Public Sector Compensation Act. The bill creating the Department of International Trade will remove all reference to the former DFAIT in both pieces of legislation.

The powers and responsibilities of the Minister of International Trade will henceforth be set under the Department of International Trade Act, which will also amend certain other acts to replace “Minister of Foreign Affairs” by “Minister of International Trade” or to add reference to the “Minister of International Trade” if needed.

This measure is not expected to have any repercussions on the daily activities of the Department of Foreign Affairs. Consular services and passport services for the public will not be affected, and Foreign Affairs Canada has promised to maintain these services for all partner departments in missions.

On an operational level, all the major aspects of the separation should soon be in place. As I was saying earlier, the two departments already operate independently and coordinate their activities. The division of resources and personnel is a complex matter, but I am sure that if it is well managed, the two departments will be able to focus on their respective main mandates and Canada will be able to follow its chosen path, reinforcing its place in the world and giving itself a 21st century economy.

As the parliamentary secretary has already said, our entire foreign policy and the Department of Foreign Affairs itself, should be in step with globalization. This requires more than one department or internal agency, not to mention the provinces, to have a presence abroad. It is important to lay out a consistent strategic framework based on partnerships to achieve this.

Given the crucial role of international trade, investment and the integration of the Canadian economy to the global economy, it goes without saying that the Department of International Trade has an important place in this collaboration. For its part, once the Department of International Trade goes its separate way, the Department of Foreign Affairs will be in a better position to focus on its fundamental mandate, which will give increasing importance to achieving consistency between international programs and programs within the Canadian government and its new partners. It will be incumbent upon the Department of Foreign Affairs to interrelate the various repercussions on foreign policy of each partner's actions in trade, defence, development, environment, and so forth, and to promote in interdepartmental authorities an understanding of the larger international context.

I will let my colleagues elaborate on the advantages this bill presents to Canada. I just want to say that it is important to pass this bill. For a year now, the two departments involved, with their partner department, have worked extremely hard to promote Canada's international program.

That said, in a nutshell, there are several fundamental messages here that Canadians should understand.

First, the legislation simply reaffirms and enshrines the mandate of the Department of Foreign Affairs to coordinate and conduct Canada's foreign policy.

The Bloc Québécois continues to raise issues that are far outside the ambit of this bill and its effect. They are valid and legitimate questions that surround the question of globalization and the integration of human rights, environmental rights and environmental protection, the protection of labourers, and so on and so forth, but as far as I am concerned they fall well outside the ambit of the import of this basic bill which gives rise to a separate foreign affairs department to coordinate and conduct Canada's foreign policy.

In effect, this is simply the codification of provisions in the 12th of December, 2003 order, and it formalizes the separation of both departments. As such, the legislation has no impact whatsoever on day to day government operations. If that were the case, we would have seen such impacts, given that we are now many months after the original separation of both departments.

There are four salient features that inform the highlights of this legislation. This reaffirms that the Department of Foreign Affairs is under the authority of the Minister of Foreign Affairs, who is responsible for the management and the direction of both the department in Canada and abroad. It makes explicit that this minister conducts Canada's foreign policy, and no other minister, and coordinates Canada's international relations. It removes from the powers, duties and functions of the Minister of Foreign Affairs those responsibilities that are simply related to international trade. It adjusts several federal acts to reflect that Foreign Affairs Canada and International Trade Canada are two separate departments.

This bill has to be read in conjunction with the bill establishing the Department of International Trade, and although there are valid concerns being raised by all members of the House with respect to the system which governs the global marketplace, the system which governs the protection of labour and labourers, the emerging system that is in place to protect our international and national environments, the import of this bill is a simple one. It creates a separate department.

Department of Foreign Affairs ActGovernment Orders

1:05 p.m.


Bev Desjarlais NDP Churchill, MB

Mr. Speaker, my colleague's comments were obviously from a very well prepared speech by the Department of Foreign Affairs.

I want to draw something to the attention of my hon. colleagues in the House. I am sure the Bloc members picked up on this but I am curious if my Conservative colleagues picked up on this, because it kind of just snuck in there a few times. I just want to emphasize what my colleague from Ottawa South said a few times. He said that the legislation merely sanctions what we already did on December 12, 2003. We really do not need this legislation because we have already done it.

What the heck are we doing here? Are we here to rubber-stamp what the government does? Is that what we are doing here? I can tell members that anybody who supports this bill is rubber-stamping the government overriding Parliament by not bringing this before Parliament before it did it.

How much will this cost Canadian taxpayers? No one has said how much this will cost Canadian taxpayers but the Liberals have gone ahead and done it. All we are here to do is to tell them that they have done a good job and that we will pass the bill because they think it is right. That just does not cut it.

The whole process of Parliament is debating legislation before we proceed. That is the issue. What does my colleague have to say about that?

Department of Foreign Affairs ActGovernment Orders

1:05 p.m.


David McGuinty Liberal Ottawa South, ON

Mr. Speaker, I was unable to discern a specific question or two with respect to the comments, but let me react to a few things the member said earlier.

To begin, she spoke about the question of CIDA and whether or not CIDA has a particular mandate, a specific mandate, a legislated mandate. This is an interesting question. As a former lawyer who has performed a lot of international development work, who has acted in an executive capacity for CIDA and whose own spouse spent five years working for CIDA, I find that an interesting comment when 1,100 employees of the Canadian International Development Agency and several thousand consultants do not believe they have a mandate.

The mandate of CIDA is crystal clear. It is informed by a series of principles and objectives, including the sustainable development of the planet, as CIDA pursues its development projects all over the world in dozens and dozens of countries.

The second fact the member has omitted to share with the House is the fact that many and in fact dozens of government departments have international activities. Each of these is coordinated through and under the auspices of the Department of Foreign Affairs, which is another reason why we needed to hive off and form a separate department. It was so we could better manage what is happening at Agriculture Canada, at Environment Canada or at the Treasury Board in terms of international projects and in terms of technical assistance which is going on all over the world. This is a strengthening of our capacity to deal with these internal management challenges.

Furthermore, just to be very clear, how can the governor in council simply create a new department? Does Parliament not have to approve a new department? The creation of new departments occurred within the statutory framework provided by Parliament. Under the authority of the Public Service Rearrangement and Transfer of Duties Act, this governor in council has the ability to transfer portions of the public service and ministerial powers, duties and functions from one part of the public service to another or from one minister to another.

Department of Foreign Affairs ActGovernment Orders

1:10 p.m.


Bev Desjarlais NDP Churchill, MB

Mr. Speaker, the member was referring to my comments on CIDA from earlier this morning. I am going to reflect on them. What I was calling for was a legislative mandate for CIDA, not a little statement in 1968 from the governor in council. I want to see a legislative mandate brought before Parliament, just like this legislation should have been brought before Parliament. That is what is important here and that is something the government seems to forget.

We have a minority Parliament right now. This government should have known that it has to do business differently.

Department of Foreign Affairs ActGovernment Orders

1:10 p.m.


David McGuinty Liberal Ottawa South, ON

Mr. Speaker, again I was trying to discern a question. I appreciate the comment.

Again, let us be clear with respect to CIDA. Why is the role of the CIDA minister not dealt with specifically in this legislation? This legislation is simple. It is to codify in law the December 2003 order in council. There are no ghosts hovering around this bill. Second, the amended act continues to provide for the Minister of International Cooperation to assist the Minister of Foreign Affairs, clearly in his or her responsibilities relating to the conduct of Canada's international relations. There is nothing omitted here that was not already included before.

Third, the government has decided to maintain the existing close integration of international development assistance, policies and programs with our foreign policy more generally. We all know of the symmetry, for example, between Canada's multilateral approach, which some describe as part of Canadian DNA, and our international development, our good governance work, our rule of law work in other jurisdictions. An example of that is what we are doing today in Afghanistan.

Department of Foreign Affairs ActGovernment Orders

1:10 p.m.

Esquimalt—Juan de Fuca B.C.


Keith Martin LiberalParliamentary Secretary to the Minister of National Defence

Mr. Speaker, I compliment my colleague on his fine speech and on his answers to the member from the NDP, and I am sure they are very clear to her.

The bill is about the division of the foreign affairs department, which we have spoken about before, but I want to look into the future of our country, our government and what we are doing to deal with some problems that have seemed intractable for a very long time.

These include the prevention of genocide, the pandemic of AIDS, malaria and other diseases that kill millions of people in the world, and looking at aid in a different way to make sure that, rather than putting good money after bad, our aid moneys are going to be used as effectively as possible. We need focused, effective aid to deal with the problems that people are faced with in some of the poorest parts of the world. And there is also terrorism.

We need a new vision for aid, for example, that is focused and coordinated, and where we look at trade that is fair and effective. The NDP has brought up many important issues that have to deal with fair trade.

Indeed, we in our party are gripped with this issue. The Minister of Foreign Affairs and the Minister of International Trade are both gripped with this issue and are working hard with our partners to try to reduce the barriers to trade.

There are two big issues that the government has put forward which I think all members should support. One is the L20 and the other is the Canada Corps. The L20 can be a new, dynamic, focused group of countries, north and south, east and west, developed and developing, which can address the seemingly intractable problems that I mentioned. The other, the Canada Corps, can bring in the best and brightest of our country and apply their skills, be they medical personnel, engineers, teachers or others, to address these problems.

I want to ask my friend a simple question. How does he see the issue of the Canada Corps and the L20 moving forward after we have had this division into both parts of what was formerly DFAIT?

Department of Foreign Affairs ActGovernment Orders

1:15 p.m.


David McGuinty Liberal Ottawa South, ON

Mr. Speaker, what is remarkable about the work of this Prime Minister that all members of the House should keep in mind is that he was one of the earliest proponents of the expansion of the notion of the G-7 to an L20.

Why did he drive that? I am convinced he drove it because he understood that there are a number of mid-power nation-states all over the world that needed to come together and serve in some ways as a counterweight to, for example, the economic power of the United States of America.

This is not to say that this party is anti-United States or anti-American, but simply to admit that there is an L20 need out there, and I think the Prime Minister should be congratulated in fairness and objectively for his work in pursuing this notion on an international basis.

The Canada Corps is a wonderful opportunity for young Canadians to go abroad and take the message of Canadian multilateralism, Canadian tolerance and Canadian diversity to all four corners of the planet.

This is something that the split or the hiving off of the Department of Foreign Affairs will further facilitate in terms of the management, the support and the spreading of the message that the L20 concept is a positive one for Canada and the globe, and the Canada Corps messages that informed its creation are desperately needed at a time when there are so many different hot spots and conflicts all over the world.

Department of Foreign Affairs ActGovernment Orders

1:15 p.m.


Bernard Bigras Bloc Rosemont—La Petite-Patrie, QC

Mr. Speaker, it is with great pleasure that I rise in this House to speak on Bill C-32, to separate the functions and responsibilities of the Department of Foreign Affairs and that of the Department of International Trade.

Yesterday, I had an opportunity to speak on Bill C-31, whose purpose is essentially the same. It is important to mention, however, that our discussions and debates in this place can only be conclusive if other debates are held down the line, particularly regarding the order that was made and which the Governor in Council general passed in December 2003.

What we are doing here today—and I tend to agree with my hon. colleague from the NDP—is debating an issue which, really, was settled on December 12, 2003, when an order was passed. All this bill has done, although it may not be mundane, is to start a discussion on issues that had already been settled and incorporated into a bill that was tabled on December 7, 2004.

It is important to ask ourselves what the government's real motivation is in bringing Bill C-32 up for debate today. The hon. members and ministers across the way would have us believe that this is a purely administrative and technical bill, with no substance, and no vision in terms of the issues and concerns of the government opposite.

Quite the contrary, what this Parliament is about to pass is not mundane at all. Basically, it puts into action a vision to separate a number of rights with respect to international trade. At a time when globalization can no longer be achieved in isolation, and when management by silos is rejected around the world in favour of a greater integration of the protection of rights—be it human rights, labour or environmental rights—into globalization mechanisms, we have in front of us a government which is trying to get us to pass a bill designed to undo something that is internationally recognized.

The Department of Foreign Affairs underwent a number of reorganizations in the past. In 1971, under Pierre Elliott Trudeau, the staff of the Department of Foreign Affairs and International Trade was integrated. In 1981, another reorganization took place, and also in 1982. The latter sought to integrate and transfer the activities relating to CIDA, industry, trade and commerce, and the trade policy, to the department.

Twenty-five years ago, when our exports accounted for barely 20% of Canada's GDP, such a decision might have been justified. However, we are now in a context of new markets and greater liberalization, with the result that our exports now account for more than 40% of our GDP.

At the same time, there is a global debate on the importance of integrating environmental protection, human rights and labour laws in our governments' decision-making process.

At a time when, in Davos and at international forums, civil society groups are trying to be heard to ensure that these concerns are reflected in trade rules, this government wants to split the role of Foreign Affairs and International Trade. We cannot sign international conventions and, at the same time, not take these concerns into consideration.

A few minutes ago, I was listening to the parliamentary secretary to the Minister of National Defence. I understand why he supports this bill. It is precisely because he is in favour of this splitting between Foreign Affairs and International Trade. He is hoping that projects such as the missile defence shield are implemented before the review of Canada's foreign policy has even begun. It suits him that this distinction be made between trade and our foreign policy. He is even hoping that a similar distinction will be made between Canada's foreign and defence policies, so that this silo approach can be perpetuated.

On this side of the House, we see things quite differently. For example, my colleague opposite, with whom I was on a mission in Ukraine in December, mentioned, by way of example, the importance of dividing the departments. However, since Canada has recognized the independence of Ukraine, one of the fundamental aspects has been its trade rules and its trade with Ukraine, which is the cornerstone of our trade.

When Ukrainians were fighting for the restoration of democracy, the government was trying to have us believe that commercial interests must not weigh in the balance in such a process. Do they think that, when societies are trying to restore the voice of democracy in their country, trade between them and Canada is not a consideration? I would think so.

China is the best example. That country is currently experiencing an important economic boom and vigorous growth and development, which will most probably expand trade between Canada and China. Is the government opposite, trying to tell us that politics and human rights considerations must not be a factor in the kind of trade we will have in the future with China? On the contrary, we must incorporate these international trading activities and decisions in Canadian foreign policy.

This is all the more true since trade has evolved in recent years. We must not forget the role of International Trade Canada, which comprises three main elements: the promotion of international trade, investment promotion and partnerships, and commercial and economic policy.

Promotion of international trade goes without saying. However, I would like to draw your attention to two other aspects of the mandate of International Trade Canada: investment partnerships. It is as if, on the other side of the House, investment was real and visible based solely on what we have accomplished in the past 10, 15, or 20 years.

However, new concerns are emerging with regard to investments. In recent years, we have seen the emergence of what is known as “socially responsible investments”. Before investing, potential investors seriously consider if the rights of workers and social rights are being respected. In my opinion, this is an integrated vision of investment partnering which, quite often, is developed by visionary small businesses wanting to ensure that these human rights are respected.

If groups within civil society or individuals believe in socially responsible investing—personally, I do—we should expect the government to have just as much faith in it. The way to clearly express this would have been to maintain and not divide foreign policy and international trade.

There is another aspect. The third aspect of the mandate of International Trade Canada relates to trade and economic policy, as if trade and economic policies remained the same and were not in constant evolution. We want to remind the government that fair trade—not trade for the sake of trade—means trade based on the creation of added-value products where the human element is integral to each product and its value. It is as if this did not exist, in the government's eyes. If the government truly believed in fair trade, it would maintain the conditions needed for these small groups to succeed. No, the decision is made to say trade is trade.

Biodiversity is another such example, since Canada has decided not to ratify the Cartagena protocol on biosafety. Its failure to ratify this protocol means it does not want to distinguish between products with GMOs and traditional products. So, it does not want to distinguish between the different products on the market.

To ensure a policy that ensures and that should ensure consistency, we must reject this bill which, in my opinion, clearly fails to make effective use of human resources and is clearly inconsistent in terms of services. This decision is, as I mentioned earlier, completely inappropriate and above all unjustified. For these reasons, we will be voting against this bill.

Department of Foreign Affairs ActGovernment Orders

1:30 p.m.

The Deputy Speaker

It now being 1:30 p.m., the House will proceed to consideration of private members' business as listed on today's order paper.

Gasoline PricesPrivate Members' Business

1:30 p.m.


Yvon Lévesque Bloc Nunavik—Eeyou, QC


That, in the opinion of the House, the government should take action with regard to gasoline prices by: (a) setting up a petroleum monitoring agency responsible for preparing an annual report on all aspects of the industry, including how prices are set and competition issues, whose director would be independent and appointed for a three-year term after consultation with sector representatives and the Standing Committee on Industry, Natural Resources, Science and Technology, and that the Committee be tasked with considering the report; and (b) by bringing forward amendments to strengthen the Competition Act, including measures to ensure that the Competition Commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

Mr. Speaker, in 2003, the Bloc Québécois was moved to take action in response to the regular gas price hikes, most of these for no reason, or no real reason.

In its November 2003 report in response to the unanimous motion by the Bloc Québécois in February 2003, the Standing Committee of Industry, Science and Technology, having studied this matter, felt obliged to recommend creation of a petroleum price monitoring agency. The present government, at the time in a heavy majority position and just as arrogant as now, rejected the recommendation, despite the unanimous opinion on the committee, some of whose members were Liberals, the present Minister of Immigration in particular.

The finance minister at that time, the irresponsible finance minister, I might add, and equally irresponsible PM now, had the gall to amend the taxation system in order to benefit the oil and gas companies even further. He dropped the tax rate on their profits from 27% to 21% over three years, while doing the exact opposite to mining companies, at a time when they were experiencing the lowest ever prices for their products.

As a result, in a number of Quebec areas, in particular Abitibi-Nord, Abitibi-Témiscamingue and the Eastern Townships, mines closed down and hundreds of workers were out of work, while the oil companies, for the first quarter of 2004 alone, were blessed with additional revenues not far from the million dollar mark, including the increase in refining margins.

As for the consumers, the truckers, taxi drivers, people living in the regions, the common carriers, both bus and trucking companies and airlines, they have never had an ounce of assistance from the government. I am not including in this certain shipping companies which conceal their assets in tax havens, fly flags of convenience, make purchases anywhere but here, and pump out their bilges into Canadian waters, Quebec waters if at all possible.

Now for the rise in gas prices. As I said at the beginning, gas prices have been increasing by leaps and bounds for years. This happened in 1999, the winter of 2000-01, the winter of 2-003, and once again in 2004.

In May 2004, gas prices reached record levels in the Montreal area, with a weekly average of 99.7¢ a litre for regular gas, I should point out. All kinds of excuses, each as false as the next, were given, such as the war in Iraq, intense cold, taxes, pipeline sabotage and production cutbacks by Arab countries, to name but a few.

Up to now, none of these has had any effect on gas prices at the pump, it seems, up to now quite the contrary. Shortages have been created artificially, and, each time, the government revelled in the situation, even though 53% of the revenues generated went in the direction of the United States.

It is worth mentioning that between May 2002 and May 2003, profit margins jumped by 62.33%, and from May of 2003 to May of 2004, they increased by 86%. In other words, they went from 29.5 cents a litre to 54.9¢ a litre and during the same period, the inflation rate was 2%, for the very reason that it was affected by the sharp increases in the price of petroleum products.

To show how little consideration this government gives to consumers, we need only consider that petroleum product prices more than doubled between 1999 and 2000. Under pressure from the opposition parties, the government introduced at that time a program to help consumers pay their heating bills. However, between 1999 and 2002, the price of petroleum products increased more than fivefold, but the assistance program disappeared, despite an even sharper increase between 2003 and 2004.

The Prime Minister, who was then finance minister and a shareholder in a western oil company, in apparently flagrant conflict of interests, had no qualms—any more than he did in the sponsorship scandal—when he reduced the taxes on petroleum company profits by 6%.

Let me be perfectly clear; I am not accusing him of getting richer. He probably lost some money, but that is not something we will shed tears over when we think about the poor folks who lost their entire life savings, or those who are unable to retire as they planned, all because of the minister's failure to regularize this situation.

Let us not kid ourselves; inflation caused by gas prices has had many effects and impacts on consumer prices, transportation costs—for those who could change them quickly enough—and on the survival of certain transportation companies, whether they move passengers or goods by air or on land. Air Canada is one example we might think of.

The most shocking thing in all this, and I am repeating it, is the fact that at least 53% of these profits do not even touch down in Canada before going off to the United States. The same thing is still happening today with this government. We could mention the printing of our money in Germany, the production of advertising brochures in China, and particularly the very explicit encouragement to clothing manufacturers to go and set up shop where slave labour is the norm.

There was a time when the federal government intervened with presence and authority in the oil industry in order to help the producers themselves in the 1960s. That was on the recommendation of the Borden commission. In 1974 there was a freeze on the price of Canadian oil at a level below world prices. In 1975, Petro Canada was created to set a standard for the industry. It cost Canadians a bundle.

It was beneficial for a time, that is, until the government realized that it was a great pork barrel for their buddies, who were just as greedy as the ones today, and then gave them a wonderful gift by selling them half of this crown corporation at a price everyone at the time thought ridiculously low.

It was from that moment that its true mission was completely dropped and it became a champion of increased profits to the detriment of Canadian shareholders. This government decided to hand over to another Liberal friendly company the job of liquidating for good what was left of a company that had just made a 564% jump in profits.

Since 1984, the federal government has been much more concerned with freeing oil markets from their obligations than protecting consumers and other companies from the underhanded control of the oil market, going so far as to present them with the possibility of adding billions of dollars more to their existing exorbitant benefits.

Instead of boosting these shameless surpluses, it would have been more appropriate to surtax the excessive profits, which might have discouraged these excessive profits. It also could have just as well required a decrease of emissions in the atmosphere. A portion of this surplus could have been used for this purpose and we may not be talking about this decrease today.

Although the major oil companies insist that consumers are well served by the current market, one thing remains unanswered: the blatant lack of transparency.

The lack of authority of the Competition Act prevents Competition Bureau investigations from being effective.

Every time a crisis arises, the public wonders about the oil industry. It is high time to put an end to the crises every time the price of gas suddenly surges.

It is no secret. The crises are in large part due to the lack of competition in the oil industry where 75% of the market belongs to the three largest refineries. The increased profits for these oil companies stems directly from the profit margin at the refining stage.

Usually, according to AQUIP, it costs between 2.5¢ and 4¢ to refine one litre of gas. When the refining margin is between 4¢ and 6¢ a litre, the company does well.

Between 1998 and March 2003, the margins averaged 7.2¢ a liter. Could it be said that it was very good? As of early March 2003, these margins fluctuated between 9.5¢ and 11¢ a liter, reaching 11.4¢ in March 2004 and an almost incredible amount of 21.7¢ of profit margin.

This is having a huge Impact on certain groups of citizens and on the economy in general. It is hurting sugarbush operators who need to heat and boil the syrup, farmers who operate farm machinery, contract truckers, all those who use heating fuel, mass transit services, bus companies whose ridership has plummeted because of the increase in prices, just as airlines and the tourism industry.

A first solution had been proposed. The Standing Committee on Industry, Natural Resources, Science and Technology of the Chamber of Commons, in its report on the Competition Act, recommended a reversal of the burden of the proof to deal with agreements among competitors and to determine whether there is a conspiracy. It would have been the responsibility of the party wishing to enter into an agreement to prove the ultimate social value of that agreement. The Bloc Québécois supported that report.

On May 5, 2003, in the industry, natural resources, science and technology committee , Mr. von Finckenstein, the Commissioner of Competition, cited raised as a shortcoming of the current Competition Act the lack of investigative powers in the context of a study of the industry, and the need to have an independent body with the authority to summon witnesses and gather information while protecting confidential information that no one wishes disclosed but that would be essential to a factual conclusion.

Indeed, how is information to be gathered when documents cannot be disclosed and witnesses protected?

The second solution that was proposed was the establishment of a petroleum monitoring agency. On April 2, 2004, the Liberal government presented its response to the standing committee's report. It said no to the establishment of a monitoring agency. It simply pledged to promote the dissemination and understanding of information on petroleum product prices. And this, even though the Liberals on the committee, including the current Minister of Citizenship and Immigration, had supported the report. This is another example of the democratic deficit under the current Prime Minister.

As I have only one minute left, I will conclude here. I urge all members of this House to support this motion in order to stabilize the quality of life of all taxpayers in every one of our ridings and to stabilize and curb any inflationary tendency.

Gasoline PricesPrivate Members' Business

1:45 p.m.


James Rajotte Conservative Edmonton—Leduc, AB

Mr. Speaker, I want to ask my colleague a couple of questions to clarify some matters.

He seemed to question the validity of the figures that are available to us. As he correctly pointed out, it was in 1995 through program review that the current Prime Minister, then the finance minister, eliminated a lot of the functions within the Department of Natural Resources to examine gasoline prices. However, there are public companies, such as MJ Ervin & Associates, that publish the prices every day on the Internet. I was on the committee when we studied this issue. In fact none of the witnesses who appeared before us, even those who alleged collusion, questioned the validity of the figures put out by MJ Ervin & Associates.

I would like to get the member's comments. Does he accept the figures that are put out by MJ Ervin & Associates? Are those figures correct in his view, or are they wrong? Is that one reason he is proposing this motion?

Also, the Competition Bureau can already investigate these matters if it gets letters of complaint from six citizens. This seems to me to be a fairly low threshold. If he thinks that is not sufficient, and obviously he does, why then does he see that as insufficient?

Gasoline PricesPrivate Members' Business

1:45 p.m.


Yvon Lévesque Bloc Nunavik—Eeyou, QC

Mr. Speaker, I thank my hon. colleague for his question. I indicated that, in 1975, the government created a company called Petro-Canada, at great expense to Canadians, to stabilize oil industry in Canada.

Regarding the gasoline prices posted on the Internet, we are not questioning the figures. We are only questioning the need to set prices that high. No reason was provided to justify such high prices, because there is no correlation between the cost of a barrel of oil and the price charged at the pump. The refining margin always jacked oil prices up. A reasonable profit margin for a refiner is somewhere between 2.5¢ and 4¢ per litre.

Gasoline PricesPrivate Members' Business

1:45 p.m.


Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I would like to congratulate my colleague from Abitibi—Baie-James—Nunavik—Eeyou on a fine speech.

We all know there are taxes on gasoline: GST, QST along with federal and provincial taxes. Could my colleague tell me if the gasoline taxes are responsible for the increase in the price of gasoline?

I would also like him to explain the different tax levels in each region of Quebec.

Gasoline PricesPrivate Members' Business

1:45 p.m.


Yvon Lévesque Bloc Nunavik—Eeyou, QC

Mr. Speaker, I thank my hon. colleague for his question. Even if some find that the taxes are too high, they do not really vary and certainly cannot account for the fluctuations in the price of gasoline. Most of these taxes are set and do not vary.

For example, at the federal level, there is a set amount of 10 cents on the price of gasoline. At the provincial level, in Quebec, for the central regions, there is a maximum amount of 15.2¢ per litre.

The provincial gasoline tax varies according to four tax zones. In the central regions, the tax level is 15.2¢. In the peripheral regions, Côte-Nord, Lac-Saint-Jean and Abitibi, for example, the tax level is 10.55¢ per litre. In specific regions like Rimouski or La Tuque, it is 12.9 cents per litre. In the border regions, the tax level varies up to a maximum of 14.2¢ per litre. GST is 7%, QST is 7.5%. Consequently, only the GST and QST vary in case of an increase before tax.

Gasoline PricesPrivate Members' Business

1:50 p.m.


David McGuinty Liberal Ottawa South, ON

Mr. Speaker, I thank the member opposite for bringing forward his private member's motion. It is a noble effort, and I would like to speak to it today in two parts.

First, I would like to address Motion No. 165 by addressing the notion of a petroleum monitoring agency. This first proposal calls for the creation of a petroleum monitoring agency that would prepare an annual report on all aspects of the petroleum industry for consideration by the Standing Committee on Industry, Natural Resources, Science and Technology.

The proposal is very similar to a recommendation made by the former Standing Committee on Industry, Science and Technology in November of 2003, at the conclusion of its report on gasoline prices in Canada. The committee's recommendation, however, at that time specifically indicated that a primary role of the agency should be to collect and disseminate pricing data, by removing specific reference to the collection and dissemination of pricing data and by replacing it with a mandate to report “on all aspects of the industry, including how prices are set and competition issues”. The motion suggests an even larger role for a new agency.

Further to this last point, I should note that the committee's report concluded:

In terms of federal government action, the Committee is satisfied that the Competition Bureau has sufficient powers, personnel and resources devoted to overseeing competitive aspects of the petroleum industry.

Based on this finding, I have to ask, why do we need an agency with an expanded mandate to report annually “on all aspects of the industry, including how prices are set and competition issues?”

In particular, in its report on gasoline pricing in Canada, the Standing Committee on Industry, Science and Technology examined a significant increase in the price of gasoline that took place over several months. It found that the price increase:

--was the result of industry participants’ competitive reactions to a series of international crises and the abnormally cold weather that gripped northeast North America last winter. No evidence was presented to the Committee of a conspiracy to raise and fix prices, nor was there evidence presented of abusive behaviour on the part of vertically integrated suppliers in the form of squeezing retail margins to eliminate or discipline independent retailers.

In its response to the committee's report on gasoline prices in Canada, the Government of Canada indicated that it had given careful consideration to the recommendation concerning the creation of a petroleum monitoring agency. Still the government concluded that current activities undertaken by federal and provincial governments or agencies, combined with information collected and widely distributed by the private sector, “provide the most practical and cost-effective method of informing the consumer”.

In summary, there is no evidence to suggest that the creation of a new petroleum monitoring agency, with its inevitable costs, is needed.

Let me turn secondly then to the bill's call for amendments to the Competition Act. The second part of the motion proposes that the government should bring:

forward amendments to strengthen the Competition Act, including measures to ensure that the Competition Commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

The government indicated in the throne speech that it was committed to providing an up to date legislative framework for business, and that it would propose changes to amend the Competition Act.

The government has already acted on the latter commitment. Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts, was tabled in early November of 2004, and referred to the Standing Committee on Industry, Natural Resources, Science and Technology on November 16. The proposed legislation follows extensive consultations with a wide range of stakeholders, large and small businesses, consumers, consumer groups, economists and legal experts to help ensure that the proposed amendments will contribute to a modern competition regime in Canada.

The proposed legislation, which is consistent with the recommendations made by the Standing Committee on Industry, Science and Technology in 2002, includes the following actions.

First, it gives the Commissioner of Competition the authority to seek restitution for consumer loss resulting from false or misleading representations. This will encourage companies to be accurate in their claims. It will allow consumers to get up to the amount paid if they have been duped by false claims.

Second, it introduces a general administrative monetary penalty provision for abuse of dominance in any industry. Currently, with the exception of airlines, the main consequence for abuse of dominance is simply an order from the Competition Tribunal requiring an end to the practice. Under exceptional circumstances, a structural change, such as divestiture, may be required. This amendment represents an additional tool to ensure compliance with the Competition Act.

Third, the legislation also removes airline specific provisions from the act to return it to a law of general application.

Fourth, finally it decriminalizes the pricing provisions dealing with price discrimination, regional price discrimination, predatory pricing and promotional allowances, so they can be dealt with under a civil regime, and this is very important, and the abuse of dominant position provisions of the Competition Act. This means that conduct like predatory pricing will receive the benefit of a full hearing on its likely economic effect. Cases will also be assessed by the Competition Tribunal with a lower civil burden of proof compared to the former criminal burden of proof.

The motion before us is not clear. It does not describe what amendments are being proposed, other than amendments to strengthen the Competition Act.

Let us look at the facts. The Commissioner can currently initiate inquiries if there is reason to believe that an offence has been committed or that grounds exist for the making of a remedial order by the Competition Tribunal. The Commissioner can summon witnesses, subject to judicial authorization; and the Commissioner must keep information confidential pursuant to section 29 of the Competition Act.

While not clear, Motion No. 165 may be referring to a suggestion that the Commissioner should have the power to conduct inquiries into markets or industry practices, even if there is no reason to believe that an offence has been committed when significant competition issues have been raised.

Other members of the Bloc Québécois have publicly indicated that this would represent an improvement to the Competition Act, and have cited a study of the gasoline industry as an example of why such powers are needed.

However, this is the government's experience. Recent nationwide consultations on various options to strengthen the Competition Act included a proposal to allow the Commissioner to ask an independent body, such as the Canadian International Trade Tribunal, to inquire into the state of competition and the functioning of markets in any sector of the Canadian economy. While some stakeholders supported the idea of market or general inquiries, many stakeholders raised strong objections to this proposal.

Serious concerns were raised with respect to procedures, length of time that these types of inquiries typically take and substantial costs likely to be incurred by both government and businesses in inquiries of this nature.

It is my understanding that in response to these concerns, the Competition Bureau is now presently examining the approaches used in other jurisdictions on a comparative basis that have general inquiry powers for competition related issues.

This brings me to my final point. The Competition Act, which dates back to 1889, is legislation of general application which provides a framework within which business can operate. It is important to approach changes to it with very careful consideration and to fully understand the possible implications of proposed amendments. There is no evidence indicating that a petroleum monitoring agency is needed.

Second, if the motion refers to general or market inquiries, I understand that more work is currently being undertaken by the Competition Bureau to resolve issues raised by stakeholders during consultations.

Gasoline PricesPrivate Members' Business

1:55 p.m.


James Rajotte Conservative Edmonton—Leduc, AB

Mr. Speaker, I am pleased to rise today to speak to Motion No. 165, and I would like to read the motion into the record. The motion states:

That, in the opinion of the House, the government should take action with regard to gasoline prices by: (a) setting up a petroleum monitoring agency responsible for preparing an annual report on all aspects of the industry, including how prices are set and competition issues, whose director would be independent and appointed for a three-year term after consultation with sector representatives and the Standing Committee on Industry, Natural Resources, Science and Technology, and that the Committee be tasked with considering the report; and (b) by bringing forward amendments to strengthen the Competition Act, including measures to ensure that the Competition Commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

As a member of the industry committee that studied this issue, I want to provide some background for members of the House. The committee studied it extensively. It issued a report in November 2003. The committee recommended something similar to what is in part (a) of the motion, although as the member just pointed out, something not quite as extensive.

With respect to part (b) of the motion, it is true that gas prices in Quebec tend to be higher than they are in Ontario. Members of the Bloc have claimed for a long time that there is collusion in the industry and that gas prices should be regulated.

However, it is important to point out that no evidence of collusion has actually come forward. In fact, the Competition Commissioner pointed out that the industry had been studied 18 to 19 times on that basis and each time it was found that there was no collusion, except in minor cases at the local retail level, not at the crude oil price, which is a world price, nor at the wholesale level, which is done within the North American context.

As well, I should point out as the government has done on a number of occasions, rightly, that the regulation of gasoline prices in Canada can be done at the provincial level. Provincial governments are free to regulate gasoline prices. In Quebec, if it feels a need to do so, the provincial government can certainly step in and regulate gasoline prices if it feels it is in the best interests of their citizens.

It is important to point out, though, that Canada ranks very low on the list in terms of gasoline prices across the world. These figures are free to anyone who wants to surf them. International Energy Agency points out that in 2003, when this study was done by the industry committee, Canada had the second lowest gasoline prices to the United States and the world at that time. If we took the comparative levels of taxation out from both the American side and the Canadian side, Canada would rank the lowest in terms of our gasoline prices. To put it into perspective, it is important for us to realize that.

I also want to provide some background on the price. People look at the price as they drive by, but they do not understand what goes into setting that price.

First, there is the international price of crude oil as set by global supply and demand. This is what people are referring to when they are talking about the cost of a barrel of oil. Obviously, that price has been very high in recent years for various reasons.

The second component to look at is the wholesale or the rack price which is the finished gasoline product used by cars and involves refining by oil refineries. For us in Canada, the price is set within a North American context.

Third is the local price that we see when we drive into fill up our vehicles, and this is a regional market price. It varies from city to city, province to province, region to region. It is a very locally driven price. However, the retail price includes taxes to which we in this party have certainly drawn attention.

I would like to point out that the standing committee report, which was done in 2003, pointed out that over the long term the price of gasoline, excluding taxes, increased by 50% while taxes on the price of gasoline increased by 67%. Taxes are the fastest growing component of the final price of gasoline, a fact that should be clearly understood by all of us.

The tax burden at the pump has been raised as one of the reasons why prices are higher in Canada than in the United States. In fact, once the taxes are stripped out and do the exchange rate, the price of gasoline is very similar, even lower in Canada than it is in the United States.

I would like to remind my colleagues on the government side that they promised to look at the whole policy of taxation on gasoline from the GST standpoint, but also in terms of the 10¢ a litre excise tax and sharing that with the provinces and municipalities for infrastructure. That has been promised for two to three years. It should certainly be fulfilled in our view.

In terms of returning to the issue of whether there is collusion within this industry, members of the standing committee listened to witnesses from all sides. Members of all parties had the opportunity to bring forward their arguments. The evidence was clear that collusion was not the cause of the increase in the price of gasoline in early 2003. This issue has been investigated 19 times. I think it is important to actually quote the competition commissioner who stated at that time, “We have never found any evidence of any kind of collusion, except at a very local level, which is usually a bunch of stations getting together and trying to maintain the price at a certain level. Those we have prosecuted with some success”.

Even those who testified that they believed collusion was possible in gasoline pricing offered no concrete evidence. The Quebec consumer coalition was unable to offer any proof except its belief, not the actual data that it presented to committee, but just a belief that there was a strong possibility of a price fixing arrangement. A possibility is not a fact.

One thing that should be emphasized here with respect to part (b) of the motion is that the Competition Bureau currently has all the powers it needs to investigate collusion. Those Canadians watching the debate who feel there is collusion should get five of their friends to write specifically about whether it is two stations or three stations they suspect and submit that to the competition commissioner. If people have a suspicion, they should gain a little bit of evidence and submit that to the Competition Bureau to deal with it.

The Competition Bureau did say to the committee that it is hampered by resources. It obviously has a finite level of resources and could use more resources to fulfill its mandate. Our party would be willing to look at that. However, we do not feel that the proper thing to do here, based on the fact that it has investigated this 19 times and has found no evidence of collusion on a grand scale, is to give the Competition Bureau more authority in this area. We feel it has enough power as it is.

Nevertheless, we have called for the industry itself to do more in explaining the actual price, to do more in explaining about the components of what goes into the price in terms of the crude price, the wholesale price, the retail price and the taxes. The industry has made some efforts in that area, but it could certainly do more.

As I mentioned, if the commissioner feels there are too many cases being presented and the bureau needs more resources, we would look at that.

I want to say indirectly, just as support for the member, that there was a report done in 2003 and the government talked about setting up some form of information commissioner. We supported that even though frankly we did not see a great need for it. That is why I asked the member if he questioned the data that was available from MJ Ervin & Associates. This information is available and every Canadian can monitor the price of gasoline across Canada. I encourage them to do that to obtain more information about how prices fluctuate across Canada.

Nevertheless, the industry itself would even support having a petroleum information commissioner who would provide information to Canadians on a regular basis. We see it as a double bureaucracy and is not necessary, but if it would give more credence to the argument that the gasoline industry is not colluding, then maybe we should look at that.

The main point we would make is that those who would want to launch an accusation of collusion ought to do so by bringing forward specific allegations against that industry. We should be very hesitant about launching accusations against industries within this country unless there is actual data. If there is such data, it should be submitted to the Competition Bureau to investigate it.

In our view, and going back to the main point in the committee report, the fastest growing component of gasoline prices is taxes. Our party called for a reduction in taxes and certainly the GST in a 2003 report. That simply has not been implemented by the government. We would encourage it to do so immediately.

Gasoline PricesPrivate Members' Business

2:05 p.m.


Réal Ménard Bloc Hochelaga, QC

Mr. Speaker, I am pleased to take part in the debate instigated by the Bloc Québécois, which has, for a long time, had a keen interest in what is certainly one of the most important issues for consumers, namely, the price of gas. This is an important issue, not just for those who work, but also for the businesses that must use oil.

The members of the Bloc Québécois have repeatedly tried to make the government understand that not only are there risks of collusion within the industry, but also that there is a real disadvantage for the consumer. Who has not had the experience of going to the gas station at the beginning of the week, and, lo and behold, the price of gas per litre has gone up by 2, 3, 4, 5 or 10 cents?

I found it rather rich to hear our colleagues in the Conservative Party of Canada trying to be reassuring with respect to the behaviour of the industry, one of the most profitable industries, as we will show later.

Thus, my colleague, the hon. member for Abitibi—Baie-James—Nunavik—Eeyou, is bringing forward a motion that has two aims. Allow me to read the motion to make things clear for everybody.

That, in the opinion of theHouse, the government should take action with regard togasoline prices by: (a) setting up a petroleum monitoringagency responsible for preparing an annual report on all aspectsof the industry—

We are well aware that, in Canada, for example, the cost of drugs is controlled. So, when there is a situation of relative consumer dependency on one type of industrial sector, it is quite normal to consider that the state has a responsibility to monitor or even control the cost, the inflation price index, the price increase of a food product deemed essential to daily life.

The motion proposes to set up a petroleum monitoring agency, which would be separate from the Competition Tribunal and the Competition Bureau. We are not saying that this bureau is not doing a good job or that it is not useful. We are saying that it does not have the authority to force people to testify and to conduct independent investigations. So, it cannot monitor or divulge information, as the member for Abitibi—Baie-James—Nunavik—Eeyou was saying . In this sense, the bureau cannot play the role of watchdog that we should be able to expect.

Let us examine the pharmaceutical industry, about which I have learned a thing or two in my role as health critic. The government has introduced the Patented Medicine Prices Review Board, which can oblige companies to testify. We are talking about big companies that perform research, the major innovative companies. The review board can issue orders that have the same weight as those issued by the Federal Court. It can even force the pharmaceutical industry to give back some of its profits when the revenues are deemed unjustified because of excessive prices.

I believe this was the example that the hon. member for Abitibi—Baie-James—Nunavik—Eeyou had in mind when he presented this motion in the House.

If we went to Vancouver, Toronto, Montreal, Moncton or any other major Canadian city, would hon. members agree that our fellow Canadians, irrespective of any kind of partisanship, are concerned by this collusion between the industries? When one increases its prices, everyone increases theirs at the same time. We are told that the review board could not conclude that there was indeed collusion. This is like some kind of vicious circle. It is circular reasoning.

Indeed, why was the Competition Tribunal or the Competition Commission not able to come to this conclusion? Because the Competition Bureau, whose mandate it is to set up the tribunal, does not have the resources needed to do so. The tribunal cannot force witnesses to testify; it does not have access to records; it cannot divulge data, which is why it was unable to come to this conclusion.

Let us stick, however, to common sense as we think of our constituents, with the week-end fast approaching. I remember the collusion that we witnessed, in Montreal for instance, before the construction holidays, in July. We saw the big oil companies raise their prices. This government has no backbone: while the law of silence reigns, it ignores the interests of the consumers and says, “No, there is no need for it, there is no need for concern.“ It is not really concerned about what happens to consumers.

Consumers are not the only ones who should be concerned. The status quo is not in the interest of big business either. I heard my colleague, who defeated our colleague, Mr. Bertrand, at his nomination meeting. He does not seem to be concerned about the situation. I invite him to be more vigilant because there is collusion. As consumers, we cannot allow the situation to continue.

Of course, governments collect taxes on gas. I have some numbers here. The federal government collects 10¢ per litre. The Quebec government can collect up to 15¢. There are regional differences. There are regions where the tax can reach 15¢. In some remote areas, such as the North Coast, the Lac Saint-Jean area, the Abitibi area, it can be 10¢. In certain border areas, the tax can be as high as 14¢. However, the root of the problem remains.

If we look at the profits recorded, we realize that Petro-Canada recorded an unbelievable increase in profits, so huge and exaggerated are they. They leapt upward by 564% in 2003, not 50 years ago, but two years ago. I repeat that Petro-Canada's profits increased by 564%, from $88 million to $584 million in the first quarter of 2003. We do not object to companies making profits, we are in a capitalistic regime. If companies make profits, it is because they take the risk of investing.

However, when a company declares a return on investment that translates into $584 million profits, we have good reason to ask questions. A few moments ago, we were told—and I am sure my colleague listened carefully—that 5¢ was a reasonable margin for refining. However, in some situations that were brought to our attention, profit margin at refining reached 21¢. Are we not right to think that that is not in the best interest of the consumer?

I am somewhat angry, in spite of my deeply calm and placid temper, when I see the Liberals and the Conservatives, the two great traditional parties, unite in a common front that goes against the interest of the consumer. I think that the Competition Bureau must be given somewhat more extensive powers. The commissioner must be able to do real investigative work.

We must not end up again in a situation where, on the eve of a long holiday, like the construction sector holiday in Quebec, the big oil corporations hike their retail prices—the gas liter had undergone a huge increase—and we are told in this House that there is no need for concern. Only obvious contempt for the consumer can lead the two major parties to express such irresponsible and uncaring views, that in no way serve the interest of the consumer.

Gasoline PricesPrivate Members' Business

2:15 p.m.

Burlington Ontario


Paddy Torsney LiberalParliamentary Secretary to the Minister of International Cooperation

Mr. Speaker, I am thankful for the opportunity brought forward by Motion No. 165 to address the issues of competition, particularly in the gasoline sector.

The second part of the member's motion proposes that the government bring forward amendments to strengthen the Competition Act, including measures to ensure that the competition commissioner has the power to launch investigations, summon witnesses and ensure confidentiality.

The challenge of the motion, of course, is that it is not at all clear what kind of amendments it is proposing. While it proposes amendments to strengthen the Competition Act and provide some non-inclusive list of examples, these examples refer to powers that already rest with the Commissioner of Competition.

Currently, as the member for Edmonton—Leduc has identified, if the commissioner has reason to believe that an offence has been committed under the Competition Act or that grounds exist for the making of a remedial order by the Competition Tribunal, she can, subject to some qualifications, “launch investigations, summon witnesses and ensure confidentiality”.

In the past, some members of the Bloc Québécois publicly indicated that they wanted to amend the Competition Act so that the Commissioner of Competition would have the power to conduct inquiries into markets and examine competition issues even if there was no reason to believe that an offence had been committed. I have some problems with that.

A study of the gasoline industry, which has been cited by some Bloc Québécois members, is an example of when such a power would be useful. Since the introduction of the motion refers to gasoline specifically, the member must realize that the issues they address would apply in a more general nature to the entire market and the potential for the commissioner to launch investigations in all areas of competition.

The first issue raised that must be addressed is that while some competition authorities in other countries, such as the U.S. and the U.K., found that these kinds of general or market inquiries were useful tools that we should look at that, I really think there needs to be appropriate checks and balances.

In the 1980s, for instance, a gasoline study was conducted by the Restrictive Trade Practices Commission in Canada. It gathered over 200 witnesses and the study took five years to complete. This has enormous cost implications for all of us.

I would also suggest that the example of the gasoline inquiry highlights the need for safeguards that could help ensure that the inquiries are initiated only when there is information suggesting legitimate competition issues that could be addressed by the inquiry.

While the member opposite has suggested that there is some kind of collusion going on between the Conservatives and the Liberals on this issue, let me say that the member for Edmonton—Leduc and I sat on a committee. The committee wrote a report to which I would refer the member opposite. All of us sat around the table and none of us got together out of some kind of crazed idea of colluding, but in fact because we had studied this issue and examined the facts.

There have been many studies on gasoline prices and all have concluded so far that there is no evidence of price fixing or other types of anti-competitive conduct that would substantially lessen competition.

The report that I referred to entitled “Gasoline Prices in Canada” by the Standing Committee on Industry, Science and Technology in November 2003 represents one of the most recent studies. In our report, the committee indicated that it was satisfied that the Competition Bureau was adequately overseeing competitive aspects of the petroleum industry. Based on information, as the member opposite has suggested, from the International Energy Agency, Canada's retail gasoline prices have consistently compared favourably to other major industrialized nations.

This brings me to a second issue. I am always concerned about any cost inputs to any aspect of Canadian industry. I am concerned when gas prices go up and small business operators who have to deal with high input costs have to face these issues, but let us also look at the other side of this. Sometimes higher gas prices help people look at other options, like public transit.

One of the more recent blips in gasoline prices, I read with astonishment, is that young are making absurd claims in the newspaper like, “At this rate it hardly justifies having a car”.

However, maybe people do need to think about the choices they make. If somehow the change in gasoline prices makes people think twice and makes them wonder about buying an energy efficient car or taking public transit, I would be quite excited about that. I just bought a hybrid and I am happy with my car choice because it is showing by example. I bought the Honda Accord hybrid and of course Honda has a vibrant plant in Ontario.

I would also draw the attention of the members opposite to Bill C-19, an act to amend the Competition Act and to make consequential amendments to other acts. The bill, already before the House, followed extensive national consultations conducted by the Public Policy Forum, an independent non-profit organization that the government hired to look into this issue. The consultations proved very useful and helped provide a well thought out and balanced package of legislative amendments that addresses the interests of consumers as well as those of small and large businesses.

Mr. Speaker, in the spirit of cooperation could I just seek clarification? If I sit down, does the member opposite get to make a concluding statement?