Debates of April 18th, 2005

Canada Grain Act

[Ted Menzies, Conservative, Macleod, AB]

Madam Speaker, there is a great deal of frustration with the farmers that I represent. I should comment that I am a farmer myself and I do understand some of these issues. I have been very involved in the transportation debates that have gone on.

I have forgotten now how many different times we have analyzed the transportation system in western Canada. My farmers are very frustrated when they have bins full of grain, in fact, bins full of tough and damp grain from last year that have not moved.

Is that a fault of the producer? Is it the producer's fault that we did not sell last year's crop? That is the backup that we have. We have an archaic system that is trying to hold commodities from one year to the next. The system is trying to speculate on whether or not this is a good time to sell, when in fact, the Canadian Wheat Board's mandate is to market grain, not speculate on grain.

Many of my producers have asked me why we need a Grain Commission? I commented on this earlier. We have an arbitrary grading system that would probably fit in the 1930s. It does not fit the mode today.

We have about 40 or 50 different grades of grain that mean absolutely nothing to the consumer in another part of the world. Perhaps it is time that we looked at a system that actually asks the consumers or the customers in the country where we are going to market the grain, what do they want? What traits in that grain does the customer want in milling qualities, malting qualities, or oil content for the oilseeds? Perhaps it is time we had a serious look at this whole system.

We can change our research and development to provide varieties that will provide exactly what the consumer wants, instead of being tied to an old system that classifies it as a number one, a number two or a number three. That means nothing when it is turned into a loaf of bread. It means nothing when it is turned into a malt barley that is made into beer.

[John Williams, Conservative, Edmonton—St. Albert, AB]

Madam Speaker, I have a quick question for the member for Macleod which deals with the Canadian Wheat Board. As he pointed out, it is strictly for western farmers. It does not apply to any other farmer, here in Ontario for example, or anywhere else.

The Liberal government has made a great big noise about the Charter of Rights and Freedoms and how we are all equal before the law. Why does the hon. member think that the government keeps insisting that western farmers must sell their grain to the Canadian Wheat Board and nobody else under pain of serious penalty, whereas Ontario farmers can sell it to whomever wants to buy it?

[Ted Menzies, Conservative, Macleod, AB]

Madam Speaker, that is the million dollar question. I have been asking that question for a long time.

[John Williams, Conservative, Edmonton—St. Albert, AB]

It has cost the farmers a million bucks too.

[Ted Menzies, Conservative, Macleod, AB]

Yes, it has cost farmers an awful lot of money. In fact, it has not only cost farmers money.

Some people in the House might be surprised to hear that it has actually cost people time in jail. I have friends who have spent time in jail. It is hard to believe that we have farmers that want to do nothing more than market their own grain and end up spending time in jail because they have done that across the border. It is an archaic law. It is about as archaic as the Canadian Grain Commission.

[John Williams, Conservative, Edmonton—St. Albert, AB]

And the Liberal government too.

[Ted Menzies, Conservative, Macleod, AB]

I would suggest that both need to be revamped. When this party on this side of the House becomes government, I think that the revamping of the Canadian Wheat Board should be a priority.

[Pierre Paquette, Bloc, Joliette, QC]

Madam Speaker, it is my pleasure to participate in this debate on C-40, although the bill has little impact on Quebec and Quebec agriculture, I have to say right off. However, it allows us to look at a number of matters pertaining to agriculture and WTO negotiations.

I must say right off that we will support the principle of this bill, as it arises from a decision by the dispute settlement body of the WTO. In addition, we believe that international trade law must apply. We wish the American authorities were as vigilant as the government in this specific matter. I would point out that the WTO ruled against the American government with respect to the Byrd amendment. Since then, the U.S. government has still not budged, and we have been obliged therefore to implement a series of retaliatory measures, with the help of other countries, in order to force the Americans to move.

Obviously, we consider it entirely reasonable for the Canadian government to make the adjustments necessary pursuant to the decision by the WTO. In this context, we will support the principle.

That said, we want to hear from witnesses in committee on the financial repercussions of this bill, in order to find out the western grain producers' concerns. As I mentioned, Quebec is not involved, but it will be important for us to hear what westerners have to say.

I am rather surprised, this morning, opinions are not unanimous with regard to the Canadian Wheat Board, as I had thought. We therefore think it important for the committee to hear witnesses so the Bloc can get a clearer idea of whether to support or reject the bill. At this point, however, I repeat, we support the principle.

Having said that, while we support the principle of the bill because this legislation results from a decision of the World Trade Organization, the Bloc Québécois intends to continue to defend producers' ability to choose how they want to market their products. As hon. members know, in Quebec it is possible for producers to have mixed plans. The decision to set up these plans is made through discussions by the agricultural sector involved. When a majority of producers wish to set up a mixed plan, this plan applies to the whole sector. This seems perfectly reasonable, because it not only allows farm producers to have a better balance of power with the companies that buy their products and which, incidentally, are often multinationals, it also allows them, by negotiating as a single entity, to get better prices for their products. Moreover, this gives them some stability in terms of revenues, while also allowing processors to have access to quality products that are also safe.

Therefore, in the negotiations that are taking place at the World Trade Organization on agriculture, we must ensure that this ability to market agricultural products is protected. In this regard, we are somewhat concerned by the Liberal government's behaviour. There is this lax approach by the government and a lack of determination in its positions. There is also the fact that, sometimes—as least based on what we can read on its Website—the government is not taking very firm positions on issues such as supply management or the protection, as I was saying, of an agricultural model that we can call our own.

I want to point out to the House that the Bloc Québécois has given its support to a movement called Maé-Maé. This is the acronym for the Mouvement pour une agriculture équitable. This movement for fair agriculture caught on in Quebec with the union of agricultural producers, particularly the chapter dealing with international development, which is enjoying a great deal of success in francophone African countries.

This movement stands for a number of principles, including the capacity of individual countries to adopt an agricultural model that not only suits their needs in terms of food security but also ensures adequate incomes for farm producers, particularly those operating small or family farms.

We hope that, while acting on the WTO decision, Canada will take a much firmer stand for fair trade agriculture, that is agriculture as determined with complete autonomy by the producers in each country.

In this context, it is extremely important that the Liberal government take note of the motion unanimously passed in this House on Friday. This motion calls on the government not to agree to any concession with respect to the supply management system during the World Trade Organization negotiations. In light of this unanimous decision of the House, we would not want the government to continue to act as if no vote had been taken here. In this context, we expect the Government of Canada to raise its voice in defence of this supply management system which, as I said earlier, reflects the choices made by a number of producers in specific agricultural sectors.

We know that supply management is extremely important for the milk sector, particularly in Quebec, but also in Ontario. It also applies to table and breeder eggs as well as to poultry. I will come back to that later.

We are in favour of Bill C-40. As I indicated, since its purpose is to implement a decision of the World Trade Organization, a number of principles will have to be defended much more firmly by the Government of Canada, a Liberal government for the time being.

We know that in the United States, New Zealand and Australia, there is a real guerilla war being waged against the agricultural system in Canada and Quebec. The agricultural model used in Canada and Quebec is misunderstood and repeatedly challenged on the grounds that it violates the WTO rules. In fact, there is a similar misunderstanding among the Americans right now in relation to softwood lumber.

Interestingly enough, the WTO decision, which led to Bill C-40, does not call into question the fact that the Canadian Wheat Board is the exclusive exporter of wheat in western Canada. That is not at issue whatsoever. Other things are. Therefore, we must build on the positive points in the decision handed down by the WTO's dispute settlement body. In my opinion, this is a very clear message, which is valid for the Canadian Wheat Board, as well as other marketing boards and practices in Canada and Quebec.

In essence, three practices used to date have been ruled inconsistent with WTO policies. Canada has been asked to comply with these policies by April 1, 2005. Bill C-40, then, is very timely.

The first practice is the rail revenue cap. A cap currently limits transportation costs for local grain; there is no such cap for foreign grain. The Canada Transportation Act must therefore be amended so that foreign grain can have the same access to the rail network as Canadian grain. Consequently, the word grain will be redefined. Clause 3 (b) of the bill makes reference to this. The same cap will apply to the transportation of local and foreign grain. The WTO had considered this practice a form of export subsidy.

The second practice is grain entry authorization. Currently, the Canadian Grain Commission must allow foreign operators to store foreign grain in licensed facilities.

The World Trade Organization felt that this section gave Canadian grain an unfair advantage, thus, subsection 57( c ) of the Canada Grain Act was simply dropped.

One final aspect contested by the World Trade Organization was the authorization to mix grains. Before domestic grain could be mixed with foreign grain, authorization was needed from the Canadian Grain Commission. This was thought to be a way of hindering foreign grain import.

Thus, clauses 1 and 2 of the bill are being replaced to address what the WTO considered anti-competitive conduct, that is, requiring operators to inform the Canadian Grain Commission when there is a mix of several grains, of foreign grains and Canadian grains. Paragraph 72(1)( b ) of the Canada Grain Act was kept. It ensures that purely Canadian grain is properly labelled in order to preserve the excellent reputation of Canadian grain in international markets.

These are extremely specific changes. As I have been saying since the start, it is interesting that in this World Trade Organization decision there was no dispute over the legitimacy of collective marketing for grain. Farmers in the west can say what they want about this, but personally I think it is perfectly reasonable for farmers to form groups to sell their products collectively to processors.

Earlier, there was discussion over french fries and how there is no marketing office in the west. In Quebec there is no potato marketing office, but there is a joint plan. I can tell you, there are some intense negotiations between potato farmers and chip makers over the price of potatoes. I was the executive director of CSN when I left, and I used to provide training to potato farmers on how to achieve a strong bargaining position and how to negotiate with multinationals.

This is one thing that is done, then, and a choice Quebec producers have made. American multinationals and Canadian ones, which do more business in the west and in Ontario, fail to understand it, however.

I think it important to note that, while the Americans have often contested the role of the Canadian Wheat Board at the WTO, the organization has never found fault with it. I would like to draw members' attention to the fact the decision provides these principles are not infringed when a state trading enterprise acts on the basis of commercial considerations. I will read some passages from the decision by the WTO dispute settlement body.

First, it provides that the Canadian Wheat Board is controlled by the grain producers whose grain it markets. Second, it provides that the fact that the Canadian government does not oversee the selling operations of the Canadian Wheat Board increases rather than decreases the probability that the Canadian Wheat Board will act in the commercial interests of the producers. Therefore, the special body concluded that, given the structure of the management of the Canadian Wheat Board, the Board is motivated to maximize the income of the producers whose products it markets.

In other words, the Canadian Wheat Board acts as a corporate selling agent, but within the context of market mechanisms, that is, the law of supply and demand intended to maximize profits. Its aim then is to maximize profits for producers. I believe therefore that the government would do well to take note of the considerations of the dispute settlement body, especially in the area of supply management.

I am going to take the time to go into some detail on this, as it is vital to us in Quebec. In the region I represent, the Lanaudière region, there are a lot of dairy, poultry and egg producers operating under supply management.

As you know, what is interesting about supply management is that its decisions are made by producers and it ensures a continuous supply to processors, fair revenues to producers and high product quality.

There are three pillars that must all be maintained if this is to be accomplished. The first is production planning, which is why it is called supply management. The second pillar consists of a pricing mechanism that ensures a fair income without government subsidies. This is very important. When supply is managed as a function of demand, this ensures proper income and proper prices for the product. There are no government subsidies.

There is a serious problem at the present time and Canada needs to start taking notice of it. At the present time there is a debate under way at the WTO on import duties and, as far as subsidies are concerned, it is a free for all. The Americans and the Europeans are heavily into agricultural subsidies. This disadvantages the developing countries in particular, but Canada as well, since it has decided to place more emphasis on administering its domestic market.

In order to administer that domestic market, a third pillar is needed. This third pillar deals with import quota control. Since the Marrakesh accord, these have been controlled by import tariffs to discourage foreign exporters from entering the Canadian and Quebec markets.

The problem is that the federal Liberal government is guilty of totally unacceptable laxity with respect to this third pillar, despite the statements made over and over again by the Minister of International Trade, the Minister of Agriculture and Agri-Food, and the former Minister of International Trade now Minister of Foreign Affairs. Dairy substitutes or products containing dairy substitutes are still being let in.

Last Friday, I gave the example of butter oil. In fact, 49% of dairy products are not covered by the list of commodities subject to quota by Canada. A policy decision absolutely must be made to add butter oils to the definition of dairy products, in order to ensure that these enter our market at rates compatible with supply management and with the third pillar, that is limitation of imports aimed at better coordinating supply and demand.

Even more serious is the fact that the Liberal government seems to be living in a bubble. Despite its rhetoric, it does not notice the extremely important technological changes that now allow us to separate the various components of milk. First, it was lactose, proteins and fat. Now, it is possible to break these by-products down even further and import them as separate products. In a few years, nothing will prevent someone from importing these products to Canada without any restrictions, reconstituting the milk and then selling it on the Canadian and Quebec markets. This undermines the very foundations of the supply management system. That is the problem.

Currently, the WTO does not have any problems with supply management. This is reaffirmed, in a way, in this ruling on the Canadian Wheat Board's practices regarding grain. However, the federal government does not seem to be taking into consideration the new reality of milk substitutes entering the market made up of 49% milk components. Indeed, it is now possible to break milk down into various components that can enter the country almost without being subject to quotas.

As I mentioned earlier, under the Marrakesh agreement, it was decided to substitute import controls. This means that we are now using tariff quotas, instead of import quotas. So, the government must take the necessary steps to change its tariff lines, so that these products are deemed to be, on the one hand, milk products and, on the other hand, products that are subject to the protective tariffs that apply to imports.

I will conclude by providing a very concrete example that would require two changes. In tariff item No. 2106.90.93 and in the following one, instead of saying “containing 50% or more by weight of dairy content”, we should say “containing 10% or more by weight of dairy content”. These products would then be subject to tariff duties of 274.5%, which would allow us to maintain that system.

Again, the only thing preventing us from taking such a measure is the government's lack of will. Let us hope that the federal government will wake up and ensure that our producers, particularly our dairy producers, are better protected.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Madam Speaker, I listened closely to my colleague's remarks. I too want dairy producers to be protected at all costs. It goes without saying that there are very specific challenges facing dairy producers, who at present are getting almost nothing for cull cows. In some cases, they are getting nothing or even showing a loss. All this to say that we cannot lose the protective measures currently in place. I am working with the Minister of Agriculture and Agri-Food and the Minister for International Trade to protect our quota systems.

I have a problem, however, when the member claims that this government is supposedly letting in certain products, such as butter oil. A clarification is necessary. We are not “letting in” this product. Currently, as the member himself said, there are tariffs on identified products. Butter oil has not been identified because, in the past, there was no such product.

I have a problem with this because, and I think the member will agree with me, I do not consider butter oil to be a product but rather a concoction, because when it is blended with sugar, the end result is used as a way to import butter oil into Canada, which is then converted back. The member said it himself. No one goes to the store to buy a kilo of butter and sugar mixed together. It is impossible, because it is neither a product nor intended for consumption. It is nothing other than a subterfuge to import a product that, in my opinion, could not otherwise cross the border.

So, I think that our arguments must address the fact that there is no such product and that this is simply a subterfuge to import a prohibited product. This must form the basis of our case, to prevent future imports of the famous butter and sugar oil now coming into Canada.

[Pierre Paquette, Bloc, Joliette, QC]

Madam Speaker, I believe we are saying the same thing. We know that butter oil is quite simply a subterfuge for getting across the border. The government is aware of this, so it seems to me that we ought to come up with a solution fairly promptly.

There has, however, been a 324% increase in imports of this product since 1996. It supplies 47% of the requirements of the ice cream manufacturing sector, thereby depriving dairy producers of $52 million in revenue. When it comes to milk components, the Dairy Farmers of Canada association has suggested a route to the government, which would be to use article 28 of GATT. I think this is something that needs some serious thought.

I am pleased that the hon. member is looking after this and I have confidence in him, but according to the information I have received, the ministers of International Trade, Agriculture and Finance have all said no to the dairy farmers' proposal to use article 28 to change tariff lines, wholly in keeping with the WTO rules. If the hon. member wants to do something useful, I think he ought to again approach the ministers responsible in order to get them to at least look very seriously at the possibility, one which the Dairy Farmers of Canada have documented very well, of using GATT article 28 to change the tariff lines for milk components such as casein. I am very pleased to hear that the hon. member is working on that, particularly since he has a lot of influence within the Liberal Party.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Madam Speaker, I wish to draw one point to the attention of my colleague. On Friday, during question period, I raised this matter in the House. I have the minister's response. I have to say that, before I had the response, I too was perhaps less encouraged. However, now that I have it, I am more encouraged. I would like to share this response with the members of the House.

In response to my question, the Minister of International Trade told the House:

Mr. Speaker, I want to commend the hon. member—

Let me assure the House that the Minister of Agriculture and I will work as hard as we possibly can, leaving no stone unturned, to protect supply management and our milk producers. The number one thing that we have to get through is the WTO negotiations where we have worked to date, along with the supply management, to protect those industries.

This is a translation of the English, in which the minister's words were “leaving no stone unturned”.

That is much more forceful than the French translation. It means, rather, that nothing will keep us from protecting supply management.

If the hon. member will read Friday's Hansard , I think he will feel, like me, a little more encouraged in the light of what the Minister of International Trade said. I would ask for his reaction.

[Pierre Paquette, Bloc, Joliette, QC]

Madam Speaker, again, I do not question the hon. member's good faith and interpretation. The information that I have dates back to last Friday afternoon.

When I was returning to my riding, I spoke with Marcel Groleau, who is the president of the Fédération des producteurs de lait du Québec. He told me that, last week, at a meeting with the three ministers to whom I referred earlier, they had been told there was no possibility in that regard. Perhaps this is a negotiating position and they will try again. In any case, I will draw Mr. Groleau's attention to the reply given to the hon. member's question.

My hope, and I am not being partisan at all and I think the hon. member will agree with me, is that this issue can be settled as quickly as possible, ideally before the election, because we do not know what may happen afterwards.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Madam Speaker, I appreciate the opportunity to rise in the House today and put a few thoughts on the record concerning Bill C-40 and the protection of Canada's right to identify what grain is coming in, what grain is moving across our land and what grain is making its way into all of those industries in our country that make product and supply consumers. This is so that all of us are confident and convinced that our health is protected, our economy is protected and, most important in this instance, our farmers are protected.

Having been here for the last eight or nine months and having listened to debate in this House, I have to say that I get a very uneasy feeling that the government does not really understand in a fulsome way the challenges faced by farmers across this country, challenges faced by farmers in my own riding of Sault Ste. Marie, in constituencies across Ontario and in other provinces.

We have had at least three take note debates in this House about the issue of BSE and the impact it is having on producers across this country. People and families invest their life savings and every ounce of energy they have to bring their best game to the table, yet at the end of the day decisions are made at higher levels by governments and organizations that do not seem to understand the priority of the small farmer in this country, and they continue to make decisions negatively.

We have some concern that this is in fact what is happening again in Bill C-40. In some ways we are putting the cart before the horse here. In other ways we are being hauled around by the nose by these organizations out there on the world level, organizations that continue to protect the interests of the most powerful against the smaller entities, the smaller countries that simply want to have a level playing field where these kinds of things are concerned.

BSE continues to rage as a huge challenge to farmers and to farming. The family farm is affected very directly by this. We still cannot get our product across the border because, from everything that I have read, the Americans have decided that it is in their best economic interests not to do that. There is nothing in that decision about health or science or good farm practices. It is all about politics and power and influence. This concerns me. It concerns me in that instance and it concerns me in regard to Bill C-40. I will certainly talk more specifically about the bill in a few minutes.

Just a few minutes ago, we heard the member for Joliette talk about the impact of a decision that came down last week on milk products and supply management. Supply management is a very important vehicle in this country to protect farmers and to protect the dairy farm. In constituencies across this country and in my own riding, particularly out in East Algoma, supply management is what keeps producers viable where dairy farming is concerned. It is what keeps them from falling into the very difficult circumstances that we see in the cattle and beef industry at the moment in this country. As a matter of fact, dairy producers are certainly affected by it, both directly and indirectly.

Let us not start meddling with the supply management template that is out there now. As has been spoken of, 20% now is going to be taken away because of new imports coming in, a ruling by the WTO that affects Canada negatively, and this government does not have the intestinal fortitude to stand up and call on article XXVIII to be put in place so we can actually go to the table and appeal that ruling and decision.

All we have to do is look at the effectiveness of the United States, the American farmers. When they see absolutely anything coming down the pipe, by a WTO ruling or something the Canadian industry or government does, they immediately use every vehicle at their disposal to challenge those decisions if they think it will affect negatively their industry, their farmers, their economy and their communities.

In Canada we seem to always be timid, almost afraid, to stand up to the powers that be. In the instance of supply management, it seems the country we are most concerned about somehow insulting or affecting in some negative way is New Zealand. Apparently calling on the World Trade Organization to appeal the decision would somehow affect negatively our relationship with New Zealand.

What about our relationship with our farmers? What about our relationship with those communities that depend on farming as their prime industry? What about the relationship of the government with its economy overall, recognizing that farming is one of those pillars of the economy that has served us so well for so long? We now are so ready and so easily willing to say that there are bigger priorities that we have to be concerned about and that we have to play on a national playing field. We have to be concerned about the temperament of other countries and what they do.

The government has a responsibility to have some backbone. It has a responsibility to stand up whenever a sector of our economy, our country, our industry is challenged and affected. It has a responsibility to say no, to hang on for a minute and look at it. It should not be afraid to appeal decisions by organizations like the World Trade Organization.

The purpose of the bill before us is to amend the Canada Grain Act and the Canada Transportation Act to bring them into compliance with the WTO ruling that decided Canadian grain handling and transportation practices violated Canada's national treatment obligations under GATT. Here we go again. The government wants the bill passed before the current crop year of July 31 in order to coincide with the WTO deadline of August 1. We do not want to attract retaliation from the U.S. We want to avoid paying compensation, but there should be some way for us to put on the table some of our very real concerns about the bill.

We have to understand that even though the purpose of the changes affect grain shipments west of and not including Thunder Bay, this is a national issue, something about which all farmers need to be concerned. It could be another block in that wall which will expose the Canadian farming and agricultural industry to all kinds of attack by big U.S. and European interests and organizations that do not readily, if we do not challenge them, recognize the impact all this will have on Canada and Canadian farmers.

Within the framework of the WTO ruling, these changes need to happen before August 1. However, there are a few areas of concern that are not addressed in the new legislation. Some concerns are on the implications in treating imported grain differently than Canadian produced grain.

The proposed amendments will repeal or amend existing provisions in the two acts which treat imported grain differently from Canadian produced grain. This includes removing the requirement that authorization be sought from the Canadian Grain Commission before foreign grain can enter licensed grain elevators. They remove the requirement that operators of licensed terminal or transfer elevators must seek Canadian Grain Commission permission to mix grain and extends the railway revenue cap to imported grain.

The first concern with the bill is with the provision of reporting U.S. and other grain imports into Canada. The proposed amendments allow for reporting, but there is little direction or evidence it will be effective as it now will come after the act instead of before. It is like closing the gate when the horses are already out

To fill the gap, the amendments to cause the process of reporting, the government has stated that it will put in place a regulation that will require elevator operators to report to the CGC, the Canadian Grain Commission, the origin of all grain and if they mix Canadian with foreign grain, to identify them as mixed.

However, it is our understanding that the CGC, CFIA and CWB are only now drafting the regulation. The timeframe allows for it to not be put in place until August 2006, a full year after Bill C-40 has gone through the House. This again brings us back to the point of closing the gate after the horses are out.

The second concern with the bill is the differentiation between imported grain and in transit grain. The legislation does not seem to be clear whether these will continue to be treated differently, or how the requirements might be different or if they will become one and the same. Currently, most grain coming into western Canada from the U.S. is simply in transit, being shipped to one of the ports. The WTO ruling seems to allow for in transit grain to be treated just as that so it does not need to receive national treatment. However, the legislation seems to redefine all grain coming in from the U.S. as imported.

Our party believes it is very important we define that in transit grain should not receive national treatment, otherwise we are left vulnerable and with very little recourse should American producers choose to take advantage of our rail line and our elevators.

Our party does not see a real problem with amending the two acts so we are in compliance with the WTO ruling. The government has already stated clearly that it will not appeal the decision. If we take too long, farmers might end up facing retaliation from the U.S. and WTO, which will not help them at all. However, the government should be making these changes with care. We do not want to leave western grain producers without regulations or protections. Those in the field have pointed out that previous protocols or regulations established by the CGC have had questionable results. This cannot be allowed to happen with the mixing of grain as it could call into question the quality of Canadian grain.

We are hearing that most producers are okay with the amendment to be in compliance, but are concerned that there be a defined difference between the treatment of in transit and imported. As well, there is the worry of the loss of reporting and what that will mean in keeping out unregistered varieties or even genetically modified grain or seed.

This brings me to another point that was raised in the House, which still has not been addressed by the government. It is an area where the government is being weak-kneed again and not taking a stand. What will we do about genetically modified seed and what is referred to as the terminator seed?

The WTO wants to allow big seed corporations and multinationals to introduce the terminator seed which will, after a seed is used once, render it useless again. The impact that will have on our own farmers, particularly small farmers who go from year to year wanting to reuse their seeds, and on developing countries and smaller third world countries, not to speak of a crime against nature, is it will decimate those economies and farming operations. We are afraid that Bill C-40 will have an impact too where we might not have the facility to recognize and know what is crossing through our territory, particularly where GM grain and seed is concerned.

We have some concerns about the WTO, an unelected body. Why does Canada have to endanger the quality of its grain because an unelected trade body says so and do so in a timeframe that is obviously too rushed for the government?

As well the U.S. consistently chooses to ignore WTO rulings, as well as those through NAFTA. Why do we have to follow through to make trade easier for American producers when the U.S. is violating such trade obligations, such as those under the GATT, with impunity?

Again I raise and point out what is happening with BSE and cattle. It is not a big stretch to talk in the House about the impact on our industry with regard to softwood lumber and the tough stand that the Americans have taken. Why can we not have that kind of backbone and intestinal fortitude?

The government is going along with globalization, but is not dotting the i 's and crossing the t 's. If we are not careful when we change legislation like this to create compliance, we could be allowing a back door where problems like unregistered seed and GM crops could get in and contaminate Canada's grain supply, which is certainly not something Canadian farmers need.

We have consulted with a fair number of western farm organizations, as well as with the Canadian Wheat Board. All in all, most producers are okay with amending to be in compliance, but are concerned that there be a defined difference between the treatment of in transit and imported, as well as the worry of the loss of reporting and what that will mean in keeping out unregistered varieties or GM grain or seed. The Wheat Board in particular believes that without regulatory changes that coincide with the implementation of the bill, Canada's reputation for providing high quality, value added grain will be diminished because imported grain will not be reported properly.

[Paul Szabo, Liberal, Mississauga South, ON]

Madam Speaker, this is a very interesting debate. The member spent a bit of time reflecting on the WTO and cited some of the concerns, particularly with regard to those who do not comply with the WTO rules.

I want to ask for more information from the member with regard to the role of the WTO in matters outside of the matter presently before the House and whether it is providing a useful instrument for our trade relationships. If there are some problems, are they reparable or has he simply lost all confidence in the WTO and it should be scrapped or we should withdraw?

[Tony Martin, NDP, Sault Ste. Marie, ON]

Madam Speaker, organizations like the WTO, the United Nations and other international bodies can be good. They have the potential to do good things for us as long as they keep in mind the interest of the consumer, not only the big countries but the smaller countries, and create a level playing field where everybody feels that they have a say, that their say is important and that it will have some effect.

When one sees over and over again rulings made by the WTO challenged by countries like the United States against Canada, for example, and softwood lumber is the one that jumps most readily to mind, then one begins to wonder just how effective and useful the organization is. If it does not have the backbone to stand up to or have the vehicles available to bring into compliance countries as big as the U.S. and the effect it has, then one wonders where we are going.

The only balance to that is we as a government and as a country have to be willing to stand up and take advantage of the vehicles available to us similar to what the U.S. does so that somewhere down the line we can get the fairness I think everybody wants.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Madam Speaker, I listened to the hon. member's comments and on the surface there appears to be something wrong with the reasoning. I want to challenge him on it.

When he refers to the WTO as being an unelected body, one could use the exact same argument for the ILO. The same countries are members. I have never heard him or his party suggest that when there is a ruling from the ILO that we do not agree with or when an ILO member country interprets a ruling that does not agree with us, that we threaten to withdraw from it, or contest it in some way stating that the organization is illegitimate because the members who sit there are not directly elected.

The next proposition attached to that is that most of the same powerful countries that he talks about are democracies. The democratically elected governments of various countries appoint their representatives to those international organizations.

Finally, we happen to have a parliamentary system of government. Our ministers are elected; at least they are as MPs. In the United States, France and a number of other countries, the ministers are not elected. The ministers within those democracies are not elected. If that is the threshold, then why is it applied so selectively?

That does not mean I agree with every WTO ruling. Certainly the fact is that some of them are not respected from time to time. But I am glad to see, for instance, that the United States is at least there.

We remember that under the GATT previously the United States was not even a member until well into the 1950s. It did absolutely everything it wanted to do. At the present time, I agree that it does not listen to everything we say. At the same time, we have to work to make the institutions stronger, not weaken them by undermining them by our statements in this place.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Madam Speaker, I agree that we need these organizations and we need to strengthen them and make sure that they actually do the job they were set out to do.

The problem is we are seeing over and over again that these organizations are being influenced unduly by bigger interests, well funded, well heeled interests, to the detriment of the smaller countries, smaller interests, small farm producers in Canada. We, as a government, duly elected by the people, need to have more backbone. We need to be willing to stand up more often and say, “Hang on here. We are moving too quickly. We do not fully understand the whole consequence of this ruling on us. We want to have some time to take a look at it and see it through and understand the impact that it will have”.

Every time the World Bank or other organizations that direct investment and development around the world meet, they are being targeted by civil society, by groups of ordinary men and women who understand that these organizations, and in some instances duly elected governments, are being unduly affected by well heeled and resourced organizations with tremendously narrow self-interests. That is my concern.

Canada in this instance under Bill C-40 has to consider absolutely everything, including the timing in terms of what we do. We do not want our grain system contaminated in any way and our farmers affected negatively; just as we do not want this terminator seed introduced into our country or third world countries so that it affects the industry and actually decimates it.

We want to see countries like the U.S. brought to heel and have them, as well as us, respond in a respectful way to some of these rulings. We do not want it to seem that it is always the big guys who are winning at the expense of the little ones.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Madam Speaker, it is my pleasure to speak today to Bill C-40, to amend the Canada Grain Act and the Canada Transportation Act.

I would like to start with the grain related provisions in the Canada Transportation Act. The revenue cap is shipper protection that places a limit on the revenues that CN, Canadian National, and CPR, Canadian Pacific Railway, can earn from certain Prairie grain movements. The revenue cap provisions came into effect in August 2000, and the revenue cap replaced the maximum rate regulation that had been in place for over 100 years.

First, I will provide a brief historical review to help illustrate key aspects of the revenue cap. In the late 19th century, the Government of Canada asked the CPR to provide reduced rates on certain railway movements, as a condition for funding the construction of a rail line from Lethbridge, Alberta, through the Crow's Nest Pass to Nelson, British Columbia. Among other things, the reduced rates applied to eastbound grain and flour shipments from the Prairies to what is now Thunder Bay. I think it was called Fort William at the time. These reduced rates became known as the “Crow rates” and only applied to the CPR shipping points existing at the time of the agreement.

In the 1920s, the Crow rates were expanded and applied by statute to shipments from all existing and future points in the Prairies on all railways and to both western and eastern movements. The statutory rates for eastbound movements applied regardless of whether grain was intended for domestic use or export, and were imposed as far as Armstrong and Thunder Bay, Ontario, the two shipping ports.

The statutory rates for westbound movements applied only to exports through Vancouver and Prince Rupert. In 1931, the rates were further extended to include northbound export grain shipments to Churchill, Manitoba. Shipping from Manitoba, especially to northern Europe, involved shorter distances for ships.

In 1984, the Western Grain Transportation Act introduced a period of cost-based rate setting. The WGTA applied to the same essentially eastern and western movements of grain, but replaced the fixed statutory rates with a system that established maximum rates based on railway costs. In essence, it was designed to allow the railways to recover their variable costs plus a full and fair contribution to their constant or fixed costs, that is, system costs that did not vary with traffic. The WGTA included government subsidies to the railways to offset the full freight rate.

In 1995, the WGTA was repealed and superseded by new western grain transportation provisions, which were incorporated into the CTA when it was implemented on July 1, 1996. This second regime continued maximum rate regulation based on the maximum rates in place but eliminated the government subsidies.

On May 10, 2000, the government announced reforms to its grain handling and transportation policies to promote a more commercial, competitive and accountable system.

The policy reforms followed extensive consultations led by Justice Willard Estey in 1998 and by Arthur Kroeger in 1999.

One of the major policy reforms was an amendment to the CTA that replaced maximum rates with a cap on railway revenues from grain movements. Other amendments included grain-dependent branch line rationalization improvements, and refinements to the Final Offer Arbitration process. As well, there were other reforms related to grain handling and transportation system monitoring, Canadian Wheat Board tendering, and funding for roads in the Prairies.

I would like to speak briefly about these latter reforms before I discuss the revenue cap. The 2000 amendments to the branch line provisions facilitated the transfer of grain-dependent branch lines to community-based shortlines, and required the railways to provide transitional compensation of $10,000 per mile annually for three years to affected municipalities when a grain-dependent branch line is closed.

To respond to a long-standing concern from shippers, a faster Final Offer Arbitration process for disputes under $750,000 was introduced. The time frame for this process was set at 30 days versus 60 days for larger disputes.

The 2000 policy reforms also saw the introduction of a program to monitor and report on the grain handling and transportation system. The program is providing key information to the federal government and other interested parties on the impact of grain handling and transportation reforms, and the overall performance of the system.

The Canadian Wheat Board committed to tender an increasing portion of its shipments to the ports of Vancouver, Prince Rupert, Churchill, and Thunder Bay.

Finally, recognizing that the new reforms would increase pressures on rural roads, a five-year, $175 million funding program was established.

I would now like to address the revenue cap.

The goal of the revenue cap is to provide the two major railways, CN and CPR, with greater flexibility to price their services based on commercial considerations, thereby promoting more innovative railway service offerings and generating better market signals for grain to move more efficiently.

The revenue cap applies to grain grown in western Canada and to processed products of grain grown in western Canada. There are over 50 types of grains defined in the legislation as eligible grains under the revenue cap. These include the six major grains—wheat, barley, canola, oats, rye and flax.

The revenue cap applies to the same movements previously covered by the regulated maximum rates. Western grain movements must originate in western Canada, that is, from any point of origin west of Thunder Bay or Armstrong, Ontario, and be destined to the Port of Vancouver or Prince Rupert, British Columbia, for export, or Thunder Bay or Armstrong, Ontario, for domestic consumption or export, or Churchill, Manitoba, for export.

In practice, the cap does not apply to movements to Churchill, Manitoba, because traffic moving to Churchill is inter-changed with a shortline railway that is not an eligible railway under the Act.

As you are aware, grain is exported from Vancouver and Prince Rupert by ship to world markets.

Both CN and CPR serve the Port of Vancouver, while Prince Rupert is served exclusively by CN.

I will continue my remarks after oral question period.

Lauren Zaracoff Care-A-Thon

[Susan Kadis, Liberal, Thornhill, ON]

Madam Speaker, I would like to speak about an important event which I attended in my riding on April 8. The Lauren Zaracoff Care-A-Thon has been an annual event held at the Louis Honoré Frechette Elementary School for the last three years.

The event honours Lauren Zaracoff, a former student who tragically lost her life to cancer three years ago at the age of 10. Over the last three years the care-a-thon has raised over $35,000 with the proceeds going to the Lauren Zaracoff Memorial Fund at the Hospital for Sick Children in Toronto.

The event brings people together to remember Lauren, a very special girl who believed in helping others. Students who participate learn the importance of volunteerism, that one person can make a difference, and in this case take an initiative in the fight against cancer.

Although this was the final care-a-thon, as Lauren would have graduated this year, her memory will forever be honoured by those whose lives she touched. This story is one of heroism, courage and community spirit that has inspired many.

I heartily applaud the Louis Honoré Frechette Elementary School, their staff, and students for their dedication and hard work in making the care-a-thon a legacy of a young courageous girl who will eternally live on in the hearts and minds of the class of 2005.

Gary Polonsky

[Colin Carrie, Conservative, Oshawa, ON]

Madam Speaker, I rise to pay tribute to a true visionary from Oshawa. This past Friday Dr. Gary Polonsky announced his retirement as president of the University of Ontario Institute of Technology and Durham College.

After 43 years of service to students across Canada, Gary has decided to take a break. Beginning in 1988 Gary served as president of Durham College and as the driving force behind the Whitby Skills Training Centre. For over 10 years he led the crusade for a new cutting edge university in Durham and in the fall of 2003 UOIT opened its doors.

Gary has been widely recognized beyond the borders of education, receiving numerous awards in recognition of his service to countless community organizations. Oshawa will miss Gary's leadership, energy and talent. Our city will forever be indebted to him for his vision and courage.

I recently had the chance to witness Gary's wonderful Elvis impression and I understand that he has a new CD out. Could this be the beginning of a new career? All the best, Dr. Polonsky, and get on with those blue suede shoes.

Canadian Museum for Human Rights

[Anita Neville, Liberal, Winnipeg South Centre, MB]

Madam Speaker, this past Friday the President of the Treasury Board announced that the federal government had committed up to $100 million to help build the new Canadian Museum for Human Rights in Winnipeg. The design for the project was also unveiled at this time, a spectacular testament to our vision for this country.

How fitting that on the eve of the 20th anniversary of the equality section of the charter, this great country now embarks on another commitment to human rights, for human rights is indeed a defining aspect of what we are as a country.

A commitment to remember the past, to honour those who have accomplished so much in human rights, and to educate the young, the museum will focus on human rights education both nationally and internationally.

I wish to congratulate the very many people from across the country involved in bringing this landmark project to this stage. I also wish to congratulate the Asper family of Winnipeg who worked to carry on the dream and legacy of the late Izzy Asper. Well done to all.

Gilles Moreau

[Nicole Demers, Bloc, Laval, QC]

Madam Speaker, Gilles Moreau, a Laval police lieutenant, was recently named inspector to head the ethics section at the Laval police headquarters.

Mr. Moreau is a man of heart, integrity and passion, who has won the trust and affection of the community he has been protecting for over 28 years, not to mention the respect of his fellow officers.

Wherever he has been, he has helped to bring the police and the public closer together. His tireless devotion has won him numerous honours, including the medal he received to mark 20 years of exemplary conduct as a police officer.

I am proud to salute the dedication, professionalism and generosity of officer Gilles Moreau, who has never been afraid to show his humanity as he went about his work with enthusiasm and an open mind.

Volunteerism

[John Maloney, Liberal, Welland, ON]

Madam Speaker, this week communities across Canada are celebrating National Volunteer Week.

Volunteers are an indispensable part of the Correctional Service of Canada and the Royal Canadian Mounted Police. Our volunteer base is comprised of skilled individuals, reflective of the cultural diversity of the Canadian population. Each volunteer brings experience and knowledge to assist in the delivery of government programs and services.

I would like to thank all volunteers for their many contributions. Their dedication and commitment to building safe communities is a true testament of Canadian values.

I would like to encourage all members of Parliament to join me in acknowledging National Volunteer Week and the hard work of Canadians who give their time to help others in every sector.

Government of Canada

[Rob Merrifield, Conservative, Yellowhead, AB]

Mr. Speaker, the citizens of Yellowhead are upset by the ongoing evidence of Liberal waste and scandal.

Like most Canadians, my constituents work hard for their money. Economic conditions are tough enough as it is, with soaring gas prices, the softwood lumber dispute and the BSE crisis. The people of Yellowhead expect their tax dollars to be spent with care, just like they spend their own funds. The federal government has let them down.

Government waste is bad enough, but corruption undermines the very confidence in government and in public office. Brown envelopes, kickbacks, and money for nothing are not what my constituents are looking for from their government. Ripping off taxpayers certainly is not one of my values, but sadly, the taint of Liberal corruption reflects badly on all politicians.

The people of Yellowhead are looking for fiscal prudence and honest stewardship from their government. It is time to clean up this mess and restore integrity to government. Our very democracy hangs in the balance.

Business Builders Youth Entrepreneurship Program

[Jean-Claude D'Amours, Liberal, Madawaska—Restigouche, NB]

Mr. Speaker, the business builders youth entrepreneurship program is designed to help young people across Canada start their own company and develop business skills.

I want to pay tribute to the accomplishments of young people in my region who are taking part in this program. In particular, I want to recognize the work done by the business of the year, J'réchauffe, under the guidance of Éric Martin, Mélissa Morneault, Émilie Lavoie, Joëlle Martin, Stacy Gorno, Jordan Bélanger, Samantha Prévost-Saint-Pierre, Jessica Martin, Karine Landry, Sophie Bérubé, Vicky Charest, Élicia Gagné, Monika Morin and Stéphanie Francoeur.

This company, run by these young people, won the business of the year award at the Jeunes entreprises du Nord-Ouest annual banquet, held recently in Edmundston.