Debates of May 5th, 2005

Quarantine Act

[The Speaker]

I hesitate to interrupt the hon. parliamentary secretary, but I do have a ruling to give which I think may be of interest to her and other hon. members. This will not detract from the time that she has, but it does interrupt what I am sure was an erudite explanation of whatever technicalities there were in the bill before us and the amendments. I will proceed with this ruling if that is satisfactory with hon. members.

I am now prepared to rule on the point of order raised earlier today by the hon. Deputy Leader of the Government in the House concerning the admissibility of the amendment to the motion to concur in the Senate amendments to Bill C-12, an act to prevent the introduction and spread of communicable diseases.

I would like to thank the hon. minister for raising this matter, the hon. House leader of the official opposition, the hon. member for St. John's South--Mount Pearl, the hon. member for Kelowna--Lake Country and others for their comments.

As hon. members know, it is well-established in our practice that an amendment must be relevant to the motion it seeks to amend. This is notably the case when the House considers amendments made in the other place. I refer the House to page 674 of Marleau and Montpetit. It states:

When the House receives amendments to a bill from the Senate, the amendments are then submitted to the House for consideration...it is for the House itself to decide whether it accepts or rejects the amendments...The motion must relate exclusively to the Senate amendments, and not to other provisions of the bill that are not contemplated by the amendments.

It seems to the Chair that the proposed amendment strays quite far from the original Senate amendments before the House and introduces elements entirely extraneous to the debate at hand.

I might also mention that there is a technical difficulty with the amendment in that it does not express a decision with regard to Senate amendment No. 1.

As Marleau and Montpetit explains at page 674, “The motion may at the same time reject certain amendments made by the Senate, and concur in or amend others”.

One concludes from that citation that the House may hold differing views on different amendments and may so inform the Senate in its message. However, it cannot remain silent on one portion and respond only to another.

Accordingly, the Chair concludes that the amendment to the motion for concurrence in the Senate amendments to Bill C-12 is not in order because it is not relevant to the main motion it seeks to amend and because it is technically flawed.

Debate, therefore, may resume on the main motion. I call on the hon. parliamentary secretary to resume her remarks and apologize again for interrupting, but I thought the House would want a decision on this matter.

[Eleni Bakopanos, Liberal, Ahuntsic, QC]

Mr. Speaker, I am glad to know that you have been very vigilant and quick in your decision so we can continue with this excellent piece of legislation. I move:

That this question be now put.

[Jay Hill, Conservative, Prince George—Peace River, BC]

Mr. Speaker, the member should have waited a little longer and used up the rest of her debating time before she moved her motion. I hate to see her debate cut short when I am sure she had more riveting and relevant remarks to make.

I was not going to ask any questions but, Mr. Speaker, when you said “questions or comments,” I thought I should at least rise and make a comment. Obviously I accept the ruling that you have made with regard to my amendment to this piece of legislation.

I want to make the comment that just because my amendment was ruled out of order does not mean that I or other members of the official opposition ever intend to let up on our daily quest to hold this arrogant corrupt Liberal government accountable. We are going to continue to do exactly what we are doing and ensure that at some point in time we can exercise our democratic right and express non-confidence in the government.

[Eleni Bakopanos, Liberal, Ahuntsic, QC]

Mr. Speaker, I am sure the hon. member will be paying close attention because we do talk about relevance in this place. As I said earlier, we are going to do things so much differently than the way they were done in the past. We will not even bother to comment on the relevancy of what just happened. I will continue with my riveting remarks.

It was in 1872 when the Quarantine Act was created. What we are trying to do with Bill C-12 is to make sure that it is a modernized Quarantine Act and it is designed to work in lockstep with provincial public health legislation to make sure that the legislation is an effective tool for the challenges we face today.

Bill C-12 offers enhanced protection at Canadian points of entry but outfits the minister with additional authorities to ensure rapid and decisive action to prevent the spread of disease, and as was said earlier, to take into the account the Charter of Rights and Freedoms. It will give the minister authority to issue emergency orders which is consistent with the Public Safety Act.

It will enable the minister to administer exit control measures, divert air carriers to alternate landing sites, restrict travel into Canada, or even close Canadian border points in the event of a public health emergency. It will also allow the minister to establish quarantine facilities at any location in Canada if it becomes necessary to isolate travellers infected and/or exposed to a serious communicable disease.

The proposed act lists many more communicable diseases for which Canadian officials can detain departing passengers. It ensures that the administration of quarantine powers is carried out by qualified professionals and that control measures are tailored to the present circumstances.

Bill C-12 will also clarify respective enforcement roles under quarantine powers and, as I and other speakers on this side of the House said earlier, guarantee that human rights are adequately protected. While the updated act authorizes the collection and sharing of personal health information, the authorization to do so is limited to what is required to protect the health and safety of Canadians in the name of public health.

Bill C-12 protects privacy rights and maintains an appropriate balance between individual liberties and the public good. The Public Health Agency of Canada has engaged many stakeholders in the development of a modern Quarantine Act. Bill C-12 also reflects the efforts and commitment of dedicated members of this House and the Senate.

During the examination process the Senate Standing Committee on Social Affairs, Science and Technology adopted an amendment to strengthen Bill C-12. The new amendment will enable members of the Senate to play a role in the making of quarantine regulations by requiring the tabling of regulations before both Houses. This seems to be a very reasonable amendment. Even the official opposition members agreed, after a little haggling on the procedural rules, with this piece of legislation.

Overall, this legislative renewal initiative reflects the government's commitment to strengthening Canada's public health system in addition to meeting our international obligations. In the spirit of collaboration, federal, provincial and local public health authorities have a significant role to play in protecting public health. Enhanced uniformity in public health legislation equipped with an array of modern tools and emergency measures will enable Canada to effectively prepare for and respond to the contemporary challenges in today's globalized world.

By introducing Bill C-12, the Government of Canada is responding to the call by public health experts and Canadians alike. Once enacted, the new Quarantine Act will ensure an effective response capacity in the event of our next public health crisis. This federal legislative tool is a critical piece in the establishment of a comprehensive public health system.

I will close by saying that it is our collective responsibility to pass this bill. it is our collective responsibility in terms of making sure that our citizens are protected from the spread of disease. As other members said earlier, I also would like to express my strong support for Bill C-12. I hope that all members of the House see the merit in this new health protection legislation and support this very important piece of legislation in terms of preventing the spread of communicable diseases in Canada.

[Don Bell, Liberal, North Vancouver, BC]

Mr. Speaker, I welcome your ruling as it enables us to carry on with the debate on this important piece of legislation. To try to use a procedural opportunity for what I would call partisan politics to delay debate on this important bill is unconscionable.

Dealing specifically with Bill C-12, the public health system in Canada is central to maintaining the health and safety of our population. Public health is the science and the art of protecting and promoting health, preventing disease and injury, and prolonging life. It is the public health system that will identify and monitor health threats and invoke appropriate interventions to mitigate the risk at hand. Ultimately a strong public health system will improve the health status of Canadians. In the context of emergency preparedness and response, our public health system is often the first line of defence against emerging and ongoing threats.

As we know, diseases do not respect borders. In today's global village they arrive by plane and they present themselves at our doorstep within hours. This is why Canada's public health system must be equipped with an array of modern tools to maintain a state of readiness to effectively manage the next wave of disaster, and we have no idea what or when that is going to be.

There is an intricate web of protection in place that is invisible to many, but it reflects the tireless efforts of those on the front line and those who support local response capacity in public health. When the public health system is working well, few take notice, but in the event of a new emerging disease like SARS, the role of public health is captured in the public's eye.

The country's response to SARS highlighted the urgent need for national leadership and coordination of public health activity across the country, especially during a health crisis. Rapid decision making, decisive action, and effective response measures are critical to managing future threats to public health.

Many of us remember the important work undertaken by Dr. David Naylor, chairperson of the National Advisory Committee on SARS and Public Health. Examining the events surrounding SARS, the Naylor committee made recommendations for change, including the need for legislative reform in the area of public health management.

In support of these recommendations and the vision that inspired the Naylor report, the Senate Standing Committee on Social Affairs, Science and Technology was also authorized to examine and report on the infrastructure and governance of Canada's public health system.

In addition, the Kirby committee examined Canada's ability to respond to public health emergencies arising from infectious disease outbreaks. In the Kirby report, initial steps were identified to facilitate the renewal and reform of health protection and promotion in Canada, including the creation of a new health protection agency to be headed by a nation's doctor, a chief medical officer of health.

Public health is a shared responsibility in this country. While provinces and territories bear primary responsibility for protecting public health within Canada, the federal government provides quarantine services at Canadian points of entry, the oldest health measure to date.

Once a traveller passes through customs, each province and territory has its own public health legislation to contain and to control the spread of a communicable disease within its own jurisdiction. Recent experiences in the global public health arena, including SARS, mad cow disease, West Nile virus, and the arrival of avian influenza, have underscored the urgency for updating public health legislation across Canada. To date, many health protection laws are woefully outdated, including the federal Quarantine Act which has been largely unchanged since 1872.

The need for a legislative overhaul in public health is required to manage contemporary public health threats with local, provincial, national and international ramifications. Action now in terms of legislative renewal will help ensure that Canadians feel confident once again that their governments are indeed protecting them from future health threats.

The Government of Canada has moved swiftly to strengthen public health by establishing the newly created Public Health Agency of Canada and the appointment of the first chief public health officer. The modernization of the Quarantine Act will complement the government's strategy in strengthening Canada's public health system and serve in the management of any new disease outbreak that might threaten the health and safety of Canadians.

The revised Quarantine Act, Bill C-12, was designed to complement existing provincial and territorial public health legislation. It offers protection at Canada's international borders and ports of entry by controlling the import and export of a communicable disease. Simply put, this bill will add another layer of protection in public health. In the pan-Canadian toolbox for public health, this legal instrument provides the federal government with the authority to detect public health risks at the first point of contact when travellers, conveyances, goods and cargo are entering the country.

The Quarantine Act is one of Canada's oldest pieces of legislation and, as I have stated already, it has not been significantly modernized since 1872. Once enacted, a modernized Quarantine Act will ensure that the federal government has the enabling authority to mitigate the risk and threat of global disease transmission.

It is not only our obligation to Canadians that we need to consider. Public health protection must be a global effort. Currently, the World Health Organization is initiating revisions to the international health regulations to ensure that countries around the world are doing their part to support rapid, decisive action to stem the spread of disease.

There are a number of important features of Bill C-12 that make it truly useful in the disease management program. It is very powerful legislation for the Public Health Agency that requires due diligence when administered.

With quarantine officers stationed at major international airports, Bill C-12 provides these federal agents and the Minister of Health with the authority they need to marshal a comprehensive and immediate response capacity at points of entry. Bill C-12 does not affect the interprovincial movement of travellers and conveyances but complements existing provincial public health legislation.

Recognizing the need for ongoing collaboration with our partners in public health, the newly proposed Quarantine Act will streamline the process embedded in public health by eliminating the distinction between listed and other diseases. It will modernize enforcement powers, including ministerial authority to divert air carriers to alternate landing sites or indeed to prohibit entry into Canada. Further, it gives authority for the procurement of quarantine space anywhere in Canada, including the ability to compensate the owner of a facility in a manner consistent with responsible and prudent government spending.

What about human rights under this new quarantine legislation? Bill C-12 will also ensure that human rights are adequately protected for providing the right to legal counsel, an interpreter and a second medical opinion. It will clarify authority to collect and share personal health information for the purpose of protecting public health.

The new bill appropriately balances individual liberty rights in the need to protect the public. It also respects the jurisdictions of our provincial and territorial partners, clarifying roles and responsibilities in the shared public health domain.

The Public Health Agency of Canada has engaged many shareholders in the development of Bill C-12, including the Senate Standing Committee on Social Affairs, Science and Technology. The final product enables the federal government to carry out what is essentially a responsibility to the citizens of Canada and further to the international community.

We also cannot ignore that in addition to the serious and significant health issues obviously related to the passage of this bill, I would like to remind all members of the House that there are also severe economic impacts of infectious disease issues. I would remind members of the disastrous economic impacts of the SARS outbreak which occurred in Toronto. The public concern translated very quickly and definitively into an economic slowdown, both in terms of retail sales and, more important, also on tourism.

I should note here that as a result of that impact on Toronto and the impact on tourism and to the economy of Toronto and Ontario, our government decided to show confidence in Toronto. Our Prime Minister called what I understand was the first federal cabinet meeting ever held outside of Ottawa. This was a show of confidence not only in Toronto and Ontario but in Canada, and showing us to the world.

The economic impact of SARS affected tourism travel around the world, not just Canada. I do not need to remind my colleagues in the House about how important tourism is to the economy of Canada, and not just to a city like Toronto because it could be any major Canadian city that has an air travel hub to other parts of Canada. The negative economic impact on tourism is not just related to the city with an international airport, but to all areas of Canada to which tourists are attracted. Tourists travel through those hubs to the various parts of Canada, from sea to sea to sea.

This is important to all of Canada, and I can speak for my province of British Columbia and in particular the greater Vancouver area. As members know, Vancouver has both an airport and a busy seaport and is recognized as the gateway to Asia Pacific. We know and have discussed in our various committees in Ottawa and in the government about the importance of the emerging Asia Pacific market and Canada's role in that.

Of recent note, I could talk on the issue of tourism. We are now in the process of finally securing approved destination status for travellers from China. This has long been an issue that has been recommended to us by tourism groups across Canada. These tourists will come through either Vancouver or in some cases directly through Toronto. This has the opportunity to significantly increase the number of tourists, particularly from China.

The kinds of fears that occurred during the SARS outbreak were such that they had a very serious potential impact on travellers who wanted to come from Asia Pacific. I can tell members of personal knowledge relating to Japan where parents were afraid either to come or to have their children come to Canada because of the SARS impact. In China, which has a one child policy, they are very nervous about sending their children here to learn English or to experience Canadian culture because they only have one child.

Regarding the impact on my region of greater Vancouver and British Columbia, we have over 20,000 foreign students currently engaged in some kind of English second language training in the greater Vancouver area, and the effect of SARS was dramatic. My riding of North Vancouver has an international college that relied heavily on Japanese students. It had a dramatic reduction in the number of students to the point that it caused it to have to refocus and change the way it operated. The college has now varied its program to include other adult students as well. In the end there was a positive impact and net effect, but we still have not regained total confidence in terms of some of these Asia Pacific countries with the fear of having their young people come to Canada.

The benefit of having them come here to be educated is they learn about our Canadian way of life, our Canadian democracy and our values. When they go back to their countries, they are some of the best ambassadors we could have as they grow up and take a role in their countries.

I would mention also the port of Vancouver. It is the second busiest port in North America after Louisiana, which is mainly an oil base port. It is not only the busiest port in Canada, but the second busiest port in North America. The movement of goods and services, which can be affected by an infectious outbreak or the discovery of some substance, such as a powder, can have a huge impact which can shut down that port.

Recently, as a government, we decided that we would lend support in recognizing the growth of the port trade to Canada and to British Columbia, which is the new container port in Prince Rupert. Forty million dollars of federal money will be flowing to help the economy in that area. This provides us now with a second major rail connection for goods into Canada.

The port of Vancouver, for a variety of reasons like rail capacity, is struggling to handle the container capacity. Some of those goods are going past British Columbia, either flowing through American ports and in fact going all the way around Panama to come up on the east coast, which adds costs and time delay and makes us less attractive as a country.

COSCO, the Chinese overseas shipping company, in the last few years named Vancouver as its first port of entry in North America, which was a huge economic advantage to us.

We have the ability now, with the port of Prince Rupert, to have a second major rail connection that will benefit Alberta, Saskatchewan, Ontario and all of Canada. Importers now can bring goods both into Canada and flow them through to the United States.

All those issues can be affected by a serious health outbreak, an infectious disease outbreak, which can come in the form of product into Canada as well. As we know, there is the risk of the West Nile virus, which is not coming from west to east, but coming from east to west across North America.

Last weekend, when I was in my home riding of North Vancouver, I read newspaper articles and heard radio accounts of the preparations that were being taken for West Nile, which had not yet arrived visibly in British Columbia and the greater Vancouver area, but it was felt it was just a matter of time.

The potential impact and the effect this will have on municipalities with the spraying program, with the proximity of the spraying to school children and to recreational areas, which are very important, is of huge impact.

Business of the House

[The Acting Speaker (Mr. Marcel Proulx)]

I have received notice from the hon. member for Cariboo—Prince George that he is unable to move his motion during private members' hour on Friday, May 6. It has not been possible to arrange an exchange of positions in the order of precedence.

Accordingly, I am directing the table officers to drop that item of business to the bottom of the order of precedence. Private members' hour will thus be cancelled tomorrow and the House will continue with the business before it prior to private members' hour.

It being 5:49 p.m, the House will now proceed to the consideration of private members' business as listed on today's order paper.

The House resumed from December 3, 2004, consideration of the motion that Bill C-281, an act to amend the Bankruptcy and Insolvency Act, the Canada Business Corporations Act, the Employment Insurance Act and the Employment Insurance Regulations, be read the second time and referred to a committee.

Bankruptcy and Insolvency Act

[The Acting Speaker (Mr. Marcel Proulx)]

Before beginning today's private members' business, I have a short statement to make concerning the provisions of Bill C-281, an act to amend the Bankruptcy and Insolvency Act, the Canada Business Corporations Act, the Employment Insurance Act and the Employment Insurance Regulations.

As with all private members' bills, the Chair has examined this bill to determine whether its provisions would require a royal recommendation and thus prevent the Chair from putting the question to a vote at third reading. It has been the practice to raise such concerns about private members' bills before the House takes a decision at second reading.

Among other things, Bill C-281 proposes to give workers first priority to amounts owed them after the bankruptcy of their employer; to ensure that payments from a bankruptcy do not form part of employment insurance benefits; and to provide a procedure whereby employees of bankrupt companies can proceed with claims against the directors.

In this particular case, Bill C-281 contains one provision which appears to require a royal recommendation, that is, a provision which proposes spending that solely the Crown can recommend under our system of parliamentary government.

Clause 6 proposes to modify section 19 of the Employment Insurance Act dealing with deductions to benefits. The clause adds the following provision:

Payments made to a claimant out of proceeds realized from the property of a bankrupt or by the government of Canada or of a province in the event of a bankruptcy shall not be deducted under this section.

In other words, where currently amounts owed to workers form part of the calculations used to determine benefits, this bill would propose that they not be used for future calculations of those benefits. This would result in greater benefits being paid to claimants. Therefore, this provision authorizes additional spending, and such spending would require a royal recommendation.

In its present form, I will decline to put the question on third reading of this bill unless a royal recommendation is received.

Today, however, the debate continues on the motion for second reading as scheduled and the motion shall be put to a vote at the close of this second reading debate.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Mr. Speaker, I am speaking on Bill C-281, an act to amend the Bankruptcy and Insolvency Act, the Canada Business Corporations Act, the Employment Insurance Act and EI regulations, as presented by the member for Winnipeg Centre.

I am pleased to make my thoughts known as the member of Parliament for Kootenay—Columbia. I have always taken my commitment to people in my community very seriously, wanting to ensure that their interests are protected and that there is a proper balance between employers and employees.

Shortly after I was elected in 1993, there was a major bankruptcy in my constituency that affected many hundreds of people. As a matter of fact, more than 1,100 people ended up applying for EI benefits as a result of that bankruptcy. The communities throughout the Elk Valley and the East Kootenays had to deal with harsh realities far beyond their control.

The bankruptcy caused tremendous hardship for families and individuals who were impacted by the failure. My office worked diligently on behalf of former employees of the corporation to help them secure portions of their pensions. Unfortunately, those portions turned out to be a small portion of the pension funds owing to them.

Through these events, I became acutely aware of the importance of good legislation in the relationships between corporations, their creditors and their employees. I became convinced that in the event of a bankruptcy there is a distinction between wages owed and the status of employee pension funds. Combining pensions and wages in one piece of legislation is not only impractical but unworkable.

As written, this bill is poor legislation. If Bill C-281 were to receive approval from the House of Commons to move to committee, the first thing I would recommend to the committee is the entire removal of the pension provisions.

There may be value in reviewing pension provisions and protection of pensions in bankruptcies, but consideration of pension provisions should be drafted in a totally different bill.

A pension review must include two tracks. Pensions involve employer-employee relations, collective bargaining, previous negotiations, existing pension funds and regulations. In most cases, there is provincial jurisdiction combined with current financial market forces in the national and international investment community. This names simply a few of the issues.

The second track must recognize that pension funds and employee interests can be reduced to dollars and cents, but that money is totally different from funds that can be realized from tangible assets secured by lenders. We must remember that lenders have choices. They are not compelled to lend money. Anything that increases risks increases the costs of borrowing. A lender may reach a point of choosing to withhold funds as risks increase.

Let us take a look at the wage replacement portion of Bill C-281 as distinct from the issue of pensions. There must be a balance between the interests of wage earners, employers and potential lenders. This balance makes the difference between having a healthy business economy with good, productive, meaningful jobs and the potential for impoverishment.

Whatever legislation we become involved in, it is the responsibility of the House to ensure it does not inhibit relationships between businesses, potential lenders or investors. Put another way, it is the responsibility of legislators to create and maintain a healthy economic environment for all Canadians.

As written, Bill C-281 would place wages owing upon bankruptcy ahead of the rights of secured creditors. Its purpose is to provide superpriority status ahead of all other creditors, including secured creditors, for amounts owed to workers in the event of bankruptcy. This would include wages and salaries, payments in the form of severance or termination pay arising from collective agreements and legislation.

The problem is that secured creditors lend money on the basis of real assets, such as property, equipment or accounts receivable, and calculate the potential of realizing cash from those real securities. In other words, while the liability to the company for wages will be a specific amount of money, that liability for wages has no direct relationship to the security pledged to the lender.

Let me explain it this way. By way of example, a company may have $150,000 security in the form of current accounts receivable. The lender may choose to advance a fixed loan or line of credit up to a limit of $100,000 against a $150,000 asset. If the workers have a combined potential of $5,000 payable for two weeks' work the lender would reduce the $100,000 loan or line of credit by at least $5,000, if not $10,000.

This represents a withholding of dollars to protect the lender against possible claims by workers in a bankruptcy. This seriously diminishes the value of the company's securable assets.

It is irrelevant whether we like or dislike this harsh marketplace reality. The fact is, lenders make choices based on their judgment of what makes good business sense to them. Lenders have choices. They are not compelled to lend money.

If Canadian laws put lenders at a disadvantage in Canada, they could make choices to lend in other international jurisdictions. This would create negative pressure for Canadian businesses by increasing costs of loans and decreasing the amount of money available in the Canadian marketplace.

As of December 2003, there were 2.3 million small, medium and large businesses operating in Canada. Almost every business from time to time requires loans or operating lines of credit. That money is almost invariably secured by some form of asset. If all workers in Canada are given superior status over secured creditors, we will see a significant decrease in the amount of credit available to businesses. This would inhibit Canadian businesses' opportunity to access funds necessary for continuation of operations or expansion.

The fact is that while there are 2.3 million businesses, there were only 8,128 business failures in 2003. This represents only four-tenths of one per cent of all businesses operating in that year. To underline or restate, 99.6% of Canadian businesses would have access to business loans reduced as a result of four-tenths of one per cent of business failures. This is simply bad economic policy that reduces jobs and opportunities in Canada. I believe there is a better way.

Beginning with the premise that workers' interests must be protected in bankruptcy, I support the creation of a wage earners' protection fund. Its purpose would be to protect workers while eliminating potential liability for lenders. This is not a new idea. Many European countries have a form of wage protection plan.

It would be built on the original principles of employment insurance, where insurance premiums are paid by employers and employees into a fund that would be based on actuarial data. It would ensure that there were funds available to protect the employees' interests in the four-tenths of one per cent of Canadian businesses that end up in bankruptcy. It would be funded separately from employment insurance and would stand alone.

We have reviewed the European experience and can state that the premiums would be calculated in pennies, not dollars. The existence of the employee protection plan would eliminate the necessity of the consideration of employees' wages from any potential borrowing or lending activity. The fund would pay benefits to workers affected by bankruptcy within a matter of weeks. This would eliminate the long wait for money that employees endure as settlements wind through months and sometimes years of bickering and negotiations.

The Conservative Party has had a subcommittee dealing with this issue, with the encouragement of our leader. We have worked with actuarial tables and based estimates on foreign experiences in European countries.

We believe businesses drive our economy, creating good jobs, wages and benefits, creating wealth for our nation. We fund health care, social programs and other desirable public expenditures from that wealth. The Conservative Party is conscious of the protection of the Canadian wage earner within a balanced, productive business climate.

It is a matter of responsibility for us to create an environment in which personal dignity and a healthy society can thrive.

In summary, Bill C-281 is poorly drafted and unworkable, but because it is an effort to recognize and give greater protection to workers in bankruptcy, I will be voting in favour of it at second reading.

However, if the bill is not rewritten in committee to reflect the necessary changes I have outlined, I will not be able to support it at third reading.

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, first of all, I would like to congratulate the member for Winnipeg Centre for having intoduced the bill to amend the Bankruptcy and Insolvency Act to provide better protection for workers. Several of my colleagues in the Bloc Québécois, myself included, would have introduced it if that had not been done already.

There is no need to tell you, therefore, that I am in favour of this important bill that would put workers first on the list of creditors when companies go bankrupt. The reason is simple and obvious: when a company goes bankrupt, it is indebted first and foremost, in my view, to its employees. They should be paid for the hours they worked. In addition, some employers do not hesitate to dip into the workers' pension fund in order to pay off creditors. This means that employers are paying off creditors with employees' money—money that does not belong to them. This is the reason it is somewhat understandable that the Liberals would hesitate to support this bill because they themselves have been misappropriating workers' money by looting the employment insurance fund.

Workers have much more to lose in case of bankruptcy than financial institutions. In light of the billions of dollars in profits that these private institutions make every year, it is only natural that the first creditors paid off by employers in case of bankruptcy should be their workers, whose only source of income is their employment.

Companies that are in danger of having to close their doors put employees in a difficult position. It is not only very hard for employees to evaluate the financial health of the companies for which they want to work but also more difficult for them to absorb a loss of income than it is for large private investors, such as banks.

Changing the law would give workers more security and companies would also benefit. Employers experiencing financial difficulties are at greater risk of losing their most valuable workers if their personnel does not have any protection. If employees knew that they would be first in line to be paid in case of bankruptcy, would they not obviously be less likely to leave their jobs if they sense that their company is in financial danger? Both employees and employers would benefit.

Unless the government wants to support creditors such as banks, I do not see any reason for members not to support this bill. One cannot be against virtue itself!

Hon. members will surely remember that, during the last election campaign, the Bloc Québécois made a commitment to amend the Bankruptcy and Insolvency Act, so that workers' salaries and pensions would be the first debts to be repaid. Personally, I find it even harder to understand how, in a case of bankruptcy, the employer can have access to the workers' pension fund. A pension fund is money set aside for retirement. The employer also contributes to the pension fund, as provided under the collective agreement. That money does not, in any way, belong to the employer, and it should not be used to repay creditors in case of bankruptcy. The problem is that the current legislation allows that. This means that a company can use other people's money to repay its own debts. This is incredible. It does not make any sense.

What would hon. members say if the law allowed the government to dip into their pension fund when there is a budget deficit? There is no doubt in my mind that Bill C-281 would get the unanimous support of this House.

Yet, these members accept the fact that companies can freely use the workers' money to repay debts that have nothing to do with them. I am anxious to see how the Liberals from Quebec will vote on this issue.

In the meantime, they say the bill goes too far, that we have to think about the investors. The workers need to figure out how to cope with a smaller retirement fund, find another job, since they unwittingly did volunteer work for their employer. It is the wealthiest in our society who oppose this bill to protect the weakest from abuse in the private sector. The individual suffers for the benefit of the major investors, yet again.

With investment comes risk, but it is a calculated risk. A job should not be calculated as a risk factor, a job should provide security and stability. A worker should not have to assess the risk of a company declaring bankruptcy. Did the employees at Nortel—which experienced explosive growth a few years ago—calculate the risk of downsizing? Was it their responsibility to do so? Thousands of employees were laid off even though Nortel did not declare bankruptcy. Nonetheless, if it had, would it have been the responsibility of these workers to have calculated the risk?

Would it have been their responsibility to use their salary and their pension fund to pay back the company's creditors? No, they are not investors, they are workers.

Furthermore, an investor only invests if he has the means to do so. He does so in full knowledge of the facts. If an employee could predict the risk of bankruptcy, then maybe he would choose to work elsewhere. The working person does not have the means not to work. Otherwise, he would spend his time, in my opinion, pursuing personal interests, not professional ones. The investor has a choice.

We are talking about labour peace and justice. To me, justice is allowing those less able to bear the burden to be reimbursed first. The worker is not an investor, but a taxpayer, an employee. His salary and pension fund should not be used to reimburse any creditor. It is ridiculous, disrespectful and irresponsible. Drawing from salaries and pension funds in such a way is theft. It is unethical and makes no sense. Workers must be protected, I will not back down from that.

Everyone knows there is a fiscal imbalance between the provinces and the federal government. Everyone agrees except the Liberal Party. Today, we are talking about a social imbalance between workers and creditors.

In addition, the current Bankruptcy and Insolvency Act threatens industrial harmony. I have two examples drawn from events that took place in my riding in the 1990s.

I am thinking of the bankruptcy of the Peters plant in Granby. Management took all the money to pay back creditors, and none of the employees got paid for their work before the bankruptcy. There was no money left. The employees had to initiate legal proceedings against the three principal shareholders in order to reach an agreement and be paid what was due them. Is that the way it should be? I do not think so.

The example of the Simond firm is all the more flagrant. Simond has subsidiaries in a number of countries. The one in Granby went bankrupt at the end of the 1980s or early in the 1990s. It represented only 3% of the company. Following the bankruptcy, in order to pay back its creditors, this major international company drew $6 million from the employees' retirement fund. After a court battle, which went on for seven years, the unionized employees won the case. It took seven years for them to recover the money that had been stolen. In the meantime, 15% of the retirees died.

Furthermore, at the end of this considerable struggle, the law was tightened up so that workers could no longer turn to the courts to defend themselves. The fact that it is legal to take money from the employees' fund was already absurd, but then, the government tightened the regulations. I feel faint when I hear this story or tell it or even think about it. Let me continue, however.

Allow me to point out an interesting fact. Who was the main supporter of the workers throughout these long lean years of the Simond dispute in which the workers' money was stolen? It was none other than the member for Shefford at the time, the current Minister of Transport. I would like to congratulate the member for Outremont on the work he did at that time. So I can reasonably expect him to support this bill. I also expect the Quebec Liberal lieutenant to show leadership among his colleagues so that Bill C-281 will also have the support of Liberal members.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I am extremely pleased to speak on this important Bill C-231 introduced by my hon. colleague from Winnipeg Centre.

First, in a way, I am totally saddened, because, while the bill is already at second reading, members still have many concerns. Many members are more inclined to take the side of major employers than that of the workers, even though they like the workers to vote for them when an election comes.

That is unfortunate because, at present, the employees get their pensions, back wages, vacation pay, severance pay and any other benefits only after the taxes, creditors and suppliers have been paid.

The best case in point is what happened just recently when the pulp mill in Nackawic, New Brunswick, went bankrupt. As the principal creditor, the company's president, who was from the U.S., made sure he got paid first by another company he owned.

Earlier, I heard the Conservative member express concern for Canada's banks. The Conservatives, and the Liberals as well, worry about the banks, while the banks are making between $5 billion and $6 billion in profits. Are you afraid they will pack up and go home?

I will tell you something, dear friends in the House of Commons. There are people working underground in the Brunswick mine who risk their health and safety every day. How many miners in Canada do that? How many people work in the woods, from morning till night, with sweat on their brow?

We may be shaken here in the House of Commons by the sponsorship scandal. Nonetheless, even if an election is called, every one of us will receive our salaries and our pensions. However, that is not the case for miners, forestry workers, the man or woman working at the paper mill in Nackawic from morning till night. They will be the last to get paid. It is shameful.

As a former union representative who negotiated many collective agreements, I would say to my colleague from Winnipeg Centre that the bill does not go far enough. The bill should require companies that offer retirement funds to put that money elsewhere rather than keeping it, waiting to declare bankruptcy and then not paying out the pensions to these employees.

It is a shame to see people who have given 20 or 25 years of their lives to a company that made profits, that had some good years, but that went bankrupt because it was not properly managed, with the result that these people lost their pensions.

It was sad to see these people cry in Nackawic, New Brunswick, because they lost their jobs after working 25 years for a company that made millions of dollars in profits. It is sad to see that the last ones to get anything are the workers.

I want this bill to make it to second reading but, at the same time, it must be accepted by the federal government. However, in order to be adopted before the election, the Liberals must stop listening to the right-wing party, namely the Conservatives. Even the member for Kootenay—Columbia said that employment insurance premiums should not be in dollars, but in cents. This is because they do not believe in employment insurance and in workers. They do not believe that when a worker loses his job, he should get some income. That is what is shameful.

It is a shame that today there are still places of employment where people go to work for the company from morning to night, where men and women work for 25 or 30 years and if the company goes bankrupt, they lose their wages. The workers are the last ones to be paid. The creditors get paid first.

The CEO of the pulp mill at Nackawic had another company. He was the principal creditor and he was the first one to get paid before the workers. Does the government support that? Is that what the government is going to do? What a shame. It is a shame to treat the working people of our country like that.

At election time, every member of Parliament is very pleased to shake hands with people and ask for their support. The candidates are always pleased to shake hands with people at the gates of a plant and ask, “Could I have your support? I will support you if I become a member of Parliament”.

We hear today that we have to be careful about the banks, that the banks will not lend money. If they do not want to lend money, they close their doors and go home. We do not need them. They are not all going to close their doors. We do not have to take that threat from anyone. We have to respect Canada's working men and women who get up every morning to go to work for years and years.

Will we as members of Parliament pass a bill in the House of Commons that if we lose in an election, we will lose our pensions? Are we ready to do that? Why are we not ready to support the working people of our country? Why does the same thing not apply to the working men and women of our country as applies to us?

It would not be a shame if for once Parliament looked at Bill C-281 and passed it. I think many companies would agree with it because those families live in communities. When they lose their pay and pension, the whole community suffers for it. Over 850 people work at Brunswick Mine in Bathurst. If the mine went bankrupt and the workers lost their pensions, what would happen to the communities of Bathurst, Chaleur and Acadie? It would hurt those communities. The banks would be laughing. That is what would happen if members do not support this bill.

It would be a shame to water it down to where it does not mean anything anymore. What is wrong about doing a day's work and getting paid for that day of work? What is wrong about making it law that the company would pay for everyone's houses and get the bank to give them the money? The money does not belong to the bank. It belongs to the labourer who works all week. It is his money.

When a pension plan is negotiated, there is a limit on how much one will get from the company, two per cent, four per cent. Does that mean there will be no more pension plans, that we put everything in wages and we get paid right away? Is that the message we want to send to workers? No, we say to people to make a pension plan, make something good of life with the little bit of money they have left. That is what we say, but in the end, if the company goes bankrupt, we will steal it from them, we will take it from them, and that is wrong. It is morally wrong. It is totally wrong.

Anyone who gets up in the House of Commons and does not vote for this bill should never go to a plant gate and shake hands with the working people come election time because they have no respect for the working people if they do that. I recommend very strongly that all parties in the House of Commons think about what they will do and what they will say to the people when they go to the ridings looking for votes. It is just unbelievable.

The CEO of the Royal Bank will not cry on the night a company goes bankrupt. I never see them cry; it is just one big group that was lost. But I see the families cry. I see the father and the mother crying. I see the kids crying. The kids will go to school with nothing. That is what we have done. It is totally wrong not to support Bill C-281.

That is why it is important to adopt this bill at second reading. People must have an opportunity to express their views. Personally, I would even adopt the bill in its present form, because it is so important. If it is amended, it would be to improve it.

Let us look after our citizens and after Canadian families. As I said, I cannot even imagine that a parliamentarian would vote against this bill and then ask workers to support him as a member of Parliament. It would be tantamount to asking workers to vote for him to represent them in Ottawa, and then to rob them of their pensions, salaries and fringe benefits. How could anyone say they would rather defend the banks than support the poor people who worked so hard and who put their health and safety at risk?

I am pleased to have had these 10 minutes to address this very important bill for workers.

[Jerry Pickard, Liberal, Parliamentary Secretary to the Minister of Industry]

Mr. Speaker, Bill C-281 put forward by the member for Winnipeg Centre contains a number of amendments to increase the protection for employees for losses that they may incur in their employment when a bankruptcy occurs. In short, Bill C-281 proposes to create a super priority for all employees' claims that would be ranked ahead of creditors, including any secured creditors.

These amendments would represent a radical change to the bankruptcy system. In doing so they would create a number of direct and perhaps unintended adverse consequences on the Canadian economy.

These amendments would fundamentally change the treatment of debt in bankruptcy. In effect, the proposed regime would override established contractual and legal rights of existing secured creditors which are a fundamental feature of a market economy. Let me explain to members of the House the economic effects that proposed amendment would have. I have to focus my intention on small and medium size businesses and how it would impact them.

It is well established that commercial lenders finance businesses based on the value of assets used to secure loans. In other words, business owners use the value of their company's receivables and inventory as well as fixed assets as collateral to secure financing. Lenders use a borrowing base formula to determine the amount of money the business owner is qualified to borrow.

The single most important determinant of a business's borrowing base is the realizable value of the assets pledged to secure a loan. The lower the realized value in bankruptcy, the lower the borrowing base. The higher the realized value in bankruptcy, the higher the borrowing base. This is where bankruptcy laws intersect with commercial lending practices.

Bill C-281 creates a super priority for claims of losses by employees in bankruptcy. This priority is open-ended and unlimited. As such it creates a great deal of uncertainty for lenders when they are making a lending decision. Given this uncertainty, lenders will face greater difficulty determining the realizable value of a borrower's collateral. As a result, lending institutions will, to protect their own asset base, reduce the amount they will lend to people.

Reducing credit availability by changing the priority scheme in the Bankruptcy and Insolvency Act as Bill C-281 proposes would have detrimental effects on small and medium size business enterprises. These businesses are the most vulnerable to a change in lending practices as they generally have a less diversified source of capital financing than large enterprises.

Small and medium size enterprises account for 98% of all businesses in Canada. Indeed, 75% of all Canadian businesses have fewer than 10 employees. In terms of employment, in 2003 more than five million people, or 49% of our private sector labour force, worked in small and medium size businesses. Those with 100 employees or less are small and medium size businesses. According to Statistics Canada, small businesses made the greatest contribution to net job creation over the period of 1996 to 2003.

We cannot put the engine of economic growth at risk. Bill C-281 would put the brakes on building the 21st century economy as we know it today. Not only would the proposed amendments reduce credit availability, but they would also increase the cost of credit for those who could obtain it. Lenders would re-evaluate the credit risk associated with their entire commercial portfolio, and would conclude that Bill C-281 increases the credit risk. This would translate into higher interest rates not only for existing loans, but for every commercial loan going forward.

The proposed amendments would also require increased monitoring by both lenders and borrowers. This would lead to increased costs for each business, as lenders would pass on their increased monitoring costs. Moreover, businesses would face higher internal compliance costs to ensure that any loans they may have remained as performing loans.

I am strongly opposed to the measures that would cause small and medium size businesses to incur added inefficiencies. Businesses, particularly small and medium size enterprises, would be negatively impacted by increasing the cost of capital. As a result, these firms would find it more difficult to expand and create employment opportunities. In fact, I would also argue that these companies would be more reluctant to invest in innovative technologies. This would have a negative effect on the growth potential of small and medium size businesses and the entire Canadian economy.

The implementation of an open-ended super priority scheme for employees' claims in bankruptcy would also have a detrimental effect on businesses that compete on an international market. None of Canada's major trading partners have such a regime of bankruptcy in their laws. This runs counter to the smart regulations approach that our government has espoused.

In the United States wage claims are given preferred status similar to that in Canada. In some European countries as well as in Australia there are government funded schemes guaranteeing the payment of wages and vacation pay.

The Canadian economy has a strong reliance on international trade, particularly trade with the United States. Close to 80% of our GDP is trade related. Our livelihoods and standard of living are dependent on Canadian businesses and their ability to compete in the international markets. Indeed, with a small domestic market, the steady expansion of multilateral trade is critical to the economy and the continued prosperity of our nation.

However, the proposed amendments contained in the bill would have severe restrictions on Canadian firms' access to capital as well as increasing costs. As such, the proposed amendments would place Canadian firms at a competitive disadvantage in the international marketplace.

All of us in the House are concerned about the problems faced by employees whose employer has gone bankrupt, particularly those who experience unpaid wages and other work related benefits. However, the Bankruptcy and Insolvency Act is a framework law which has horizontal application across the entire economy. Changing it requires careful analysis and balance. There could be unforeseen ripple effects which could have serious unintended consequences on the economy.

The government agrees that there is a need to protect workers who remain unpaid when their employer goes bankrupt. Indeed, it is my understanding that as we speak, the government is studying options to improve the treatment of workers' claims in bankruptcies. I want to see reform to improve the protection for employees' claims in bankruptcy, but Bill C-281 is certainly not the answer.

[Marlene Jennings, Liberal, Parliamentary Secretary to the Prime Minister (Canada—U.S.)]

Mr. Speaker, I would like to start by saying how pleased I am to participate in this debate on Bill C-281. The principle, the concept and the objective are all worthwhile.

I grew up in a union family. My father was a union member all his life. He even was the secretary-treasurer on the executive board of his union for the region of Quebec. All that to say that I have seen the tough times families can go through when the head of the household is a union worker or a labourer.

I was a shop steward for several years before completing my law degree. I was first elected to this place in 1997, and the Dominion Bridge Lachine plant, a subsidiary of Dominion Bridge Corporation, whose reputation is well known to all hon. members, I am sure, was located in my riding. This major company was a symbol of economic development in Canada during the 19th century and the early part of the 20th century.

Soon after my election, this company went bankrupt and the plant located in my riding faced closure. This meant that some 300 employees, the majority of whom were members of the steelworkers local, would be losing not only the wages owed for the work already performed, but also pension benefits, among other things.

In the community of Lachine, we immediately set up a Dominion Bridge Lachine survival committee, comprising representatives of the local metalworkers' union, my provincial counterpart, MP François Ouimet, municipal officials of the day, myself, local people involved in economic development, representatives of the CEDC, the community economic development corporation, and of Transaction pour l'emploi and many other interested parties. With the help of the Fonds des travailleurs du Quebec, we interested another company in buying the assets of Dominion Bridge Lachine and hiring all the employees.

In the meantime, the employees had to depend on employment insurance. I must congratulate the department of the time, which handled the employment insurance scheme. It immediately set up a committee of officials to help workers apply and ensure that they did not lack money to put food on the table and pay hydro, the rent or the mortgage.

Bill C-281 does have problems, though. I would be prepared to have it referred to committee, because I think committee is the best place to examine the question and the objectives. It does have some serious problems, though, in connection with use of employment insurance, for example.

I would like to speak to that because what is quite interesting is that at times life and reality overtake a piece of legislation that is being proposed. I would like to talk about the issue of protecting workers for payment of wages that they are owed if their employer declares bankruptcy.

[An hon. member]

Pensions.

[Marlene Jennings, Liberal, Notre-Dame-de-Grâce—Lachine, QC]

One of the members in the House continues to call out “pensions”. The member is quite right. The government needs to look at the Bankruptcy and Insolvency Act, the Canada Business Corporations Act, the Employment Insurance Act and so on.

I wish to deal with the issue of wage protection. Today, the Government of Canada announced a wage earner protection program. I would like to read part of the news release that went out. It states:

Today, the Minister of Labour and Housing, accompanied by the Leader of the Government in the House and the Minister of Industry announced the Government's intention to move quickly to establish the Wage Earner Protection Program. The program will help protect workers by providing a guaranteed payment of wages owed up to $3000 should their employer declare bankruptcy.

Under the present bankruptcy system, workers' claims for unpaid wages rank after secured creditors. As a result, many workers have to wait from one to three years to get a fraction of the wages owed to them--13 cents on the dollar on average. These workers are often the most vulnerable and working in low-wage jobs in small businesses (under 10 employees) in the construction, retail and food services sectors. Under the proposed program, affected workers could make their wage claim right away and should receive their money about six weeks later.

The Minister for Labour and Housing stated:

This program is about fairness and helping the most vulnerable workers. The Wage Earner Protection Program will ensure that workers get their wages quickly, when they need it most. It will also ensure that payment of wages will no longer depend solely upon the amount of assets in employers' estates.

The Leader of the Government stated:

There is a need to address a number of issues related to employees and businesses that suffer bankruptcies or insolvencies...Our Government has put forward an ambitious legislative agenda that reflects the priorities of Canadians.

The member who put forward Bill C-281 is correct in that protecting workers and employees, who have earned wages when their employer goes under bankruptcy or insolvency, is something that is a priority for Canadians. The Leader of the Government also stated:

We want to ensure workers do not face undue hardship if the business or enterprise, where they are employed runs into difficulty.

The Minister of Industry stated:

The Government recognizes that the present insolvency system lacks an effective mechanism to provide certain and timely payment of the wages owing to workers whose employers go into bankruptcy or receivership under the Bankruptcy and Insolvency Act...The Wage Earner Protection Program is designed to remedy this gap and to form part of a comprehensive insolvency reform package, which I intend to introduce this spring.

When the member was calling out the word “pensions”, I wish to repeat that the Minister of Industry has already stated that there will be a comprehensive reform of the Bankruptcy and Insolvency Act.

When the Minister of Industry states that he intends to bring forward a comprehensive insolvency reform package this spring, that means that the issue of workers' pensions, when their employers either goes into bankruptcy or insolvency, will also be addressed.

I call on hon. members to look carefully at Bill C-281, but I do believe it should go to committee for that kind of extensive analysis.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I put forward Bill C-281 because there are 10,000 bankruptcies a year in this country and more often than not, or all too frequently at least, workers are left owed back wages, benefits and, most important, pension contributions from underfunded pensions.

Hearing the debate today and even in the first hour of debate, I have to remind my colleagues that we are in the House of Commons. This is the place where we are supposed to be advocating on behalf of ordinary Canadians, the common folk, and what I hear are apologists for the banks more than anything else, frankly.

Those who are opposed to the idea of bankruptcy protection for ordinary Canadians are acting like corporate shills for the banks by saying that we need a tag day for them and we need to ensure they get everything that is owed to them in order of priority over and above the needs of the working people. Something is terribly backwards with this tone and this attitude.

In actual fact, there is money in most bankruptcies to pay the employees. My bill seeks to put workers first on the list of priority when we are distributing the assets or the proceeds from a bankruptcy instead of dead last where they are now. I do not see what is so revolutionary about that concept. Were we not all sent here by ordinary Canadians to advocate on their behalf?

Somehow things got so screwed up in Ottawa. Big money has been running things here for so long that all of the legislation seems crafted in such a way as to serve the interests of big money. Here we have an opportunity to do what is right for ordinary grassroots Canadians and put them first and we hear people saying that it might interfere with the banks' ability to be secure, blah, blah, blah. Honestly, I could spit with anger. It really makes me angry.

We have recent concrete examples. My colleague from Acadie—Bathurst was explaining perhaps the most egregious example of what is wrong with the bankruptcy legislation in the country. He spoke about the Nackawic pulp mill where people with 35 years' service were getting zero of their pension contributions, while $100 million of assets were being distributed among the creditors. Workers are not viewed as creditors.

The interesting thing is if the company has been operating for the last few months of its existence by ripping money out of the pension plan that makes workers creditors. They are investors in the company but unwillingly and unwittingly. They deserve a super priority, in my view, for that very reason.

There is a trust relationship between the employer-employee that is ancient and, I argue, is sacrosanct and should not be tampered with. That trust relationship is, “I will come to work every day and I will lay down my life to dedicate it to your financial enterprise and you pay me x amount of dollars”. That is the trust relationship that exists. However in the event of bankruptcy that gets tossed out the window and everybody gets their share before that employee gets a single cent and more often than not there is nothing left for them.

When I hear people acting as apologists for the banks over the interests of ordinary Canadians, it makes me wonder which side they are on in this very simple debate.

I will tell members where Canadians stand. In a recent Vector poll, 87% of Canadians said that the current bankruptcy laws were unfair, needed to be changed and were overdue to be changed. We have had commissions and studies for 30 years saying that our bankruptcies laws are unfair and do not represent the interests of workers.

The NDP for the last three Parliaments has submitted virtually the same bill. It came within four votes when my colleague from Churchill put it forward as a motion two Parliaments ago; that is, two people voting the other way and we could have had some satisfaction. The workers at the Nackawic mill would not have been screwed if we had listened to the member for Churchill back then.

Year after year, decade after decade goes by with no protection for employees in the event of bankruptcy. The number of bankruptcies is not going down and the protection of employees certainly is not changing.

I cannot believe anyone who was sent here by ordinary Canadians to advocate on their behalf would be a shill for Bay Street and an apologist for the banks, instead of an advocate for ordinary working Canadians. It is a shame.

[The Acting Speaker (Mr. Marcel Proulx)]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[An hon. member]

On division.

[The Acting Speaker (Mr. Marcel Proulx)]

I declare the motion carried. Accordingly, the bill stands referred to the Standing Committee on Industry, Natural Resources, Science and Technology.

(Motion agreed to, bill read the second time and referred to a committee)

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

[Loyola Hearn, Conservative, St. John's South, NL]

Mr. Speaker, when we have these late shows sometimes they come long after we have asked the original question. A few weeks ago I asked the Minister of Finance when he would be bringing in legislation to deal with the Atlantic accord.

For those who are not sure what I am talking about, a deal was made between the federal government and the provincial Governments of Newfoundland and Labrador and Nova Scotia to improve benefits from offshore development. This deal was made, of course, after a tremendous amount of hassle and pressure from the opposition and also from both provinces. However the deal was made and an agreement was signed but then we wait weeks and weeks for legislation.

The thought at the time was that the government would bring in the two page piece of legislation, which it had developed and to which, by the way, both provinces had agreed, but it dragged on and on. Consequently, I asked my question.

The legislation has now been introduced and members may be wondering why I am still looking for an answer.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Good point. Why did you leave it on the order paper?

[Loyola Hearn, Conservative, St. John's South, NL]

The parliamentary secretary asks why I would leave that question on the order paper?

One of the reasons is that I am having withdrawal symptoms from not having my daily fix of the parliamentary secretary. For weeks on end we had fairly heated exchanges on this very issue, me promoting the offshore development and the revenue sharing, and the parliamentary secretary speaking on behalf of his minister who was finally, by the way, told by the Prime Minister to get the job done.

The parliamentary secretary was telling me that we should not get any resources because he felt that my province and the province Nova Scotia were always there with our hands out looking for someone else's money. However I have assured him that we were there asking the government and Ontario to give us back some of the money that we sent up here.

The problem is that when the legislation was brought in the government brought it in as part of an omnibus bill. The government will argue that it is part of the budget bill. Yes, of course it is part of the budget bill. It will also say that it cannot change that unless it gets unanimous consent in the House.

We have to remember that just a short while ago our leader made a motion in this House, seconded, not by the leader of the Bloc, but by the leader of the NDP, to split the bill and bring forth singular legislation on offshore revenue sharing.

We did not get unanimous consent. It was not the Conservatives who said that could not be done. It was not the NDP, the friends of the Liberals. It was the Liberal Party that said no, with, by the way, the assistance of the Bloc. The Liberals and the Bloc teamed up to prevent Newfoundland and Nova Scotia from having a singular piece of legislation that could quickly go through this House.

I will let the parliamentary secretary tell me why he is making those promises to wait and wait for the revenues, waiting until this whole--

[The Acting Speaker (Mr. Marcel Proulx)]

The hon. Parliamentary Secretary to the Minister of Finance.

[John McKay, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I would be happy to answer the hon. member's question. He put his question on March 7 as to when the legislation would be tabled. We answered on March 24 with the tabling of Bill C-43 the budget implementation bill. That was the complete and full answer to his question of March 7. He apparently does not like to take “yes” for a answer.

Bill C-43 contains a whole number of things. The hon. member is right. It is a omnibus bill. It contains provisions for child care. It contains provisions for the new deal for communities. It contains payments to Saskatchewan for the operation of the equalization program and for payments to support British Columbia in dealing with the mountain pine beetle infestation. The government cannot make these payments until Bill C-43 passes.

Last year's budget provided some examples of additional measures for provinces. I would argue with the hon. member. I do not know why one priority is a greater priority than any other priority. All those priorities I just mentioned are of great significance to particular people in particular areas as is his priority.

Last year's budget did the same thing. We had some example of additional measures to the provinces, which were again payments to Saskatchewan for the operation of Crown lease base in equalization, payments for the implement of the equalization renewal and payments for the $400 million made available to provinces and territories in support of the national immunization strategy and public health capacity. Again, why is one priority greater than the other priority? The way the government handles these things is through an omnibus bill.

I will briefly review what is in the offshore accords. It allows Newfoundland and Labrador and Nova Scotia to ensure that they retain 100% of their respective offshore resource revenues and equalization payments come on top of that. There were quite a number of months of discussion and on February 14, I do not think there is any significance to be attributed to that date, the Government of Canada reached agreements with those provinces.

First, the agreements provided 100% protection from equalization reduction or clawbacks for eight years as long as the provinces received equalization payments.

Second, an upfront payment of $830 million for Nova Scotia and $2 billion for Newfoundland and Labrador to provide the provinces with immediate flexibility to address their unique fiscal challenges.

Third, these agreements provide for a further eight year extension as long as the province receives equalization in 2010-11 or 2011-12, and that its per capita net debt has not become lower than that of at least four other provinces.

This is a unique window of opportunity and exceptional treatment for those two provinces. The uniqueness of this deal is because they face unique challenges. Newfoundland and Labrador and Nova Scotia have the highest net debt of all provinces as a percentage of GDP. In the case of Nova Scotia, 43%. In the case of Newfoundland and Labrador, 63%.

Newfoundland and Labrador in particular has an unemployment rate of 14.9%. Therefore, the government felt that those unique challenges required specific response and that specific response was given in Bill C-43.

The hon. member is going to complain that the bill is not moving forward. The reason the bill is not moving forward, he should look in the mirror and while he does so, he should take the mirror over to his leader.