Debates of Sept. 26th, 2005

Gasoline Prices

[John Duncan, Conservative, Vancouver Island North, BC]

Madam Speaker, that question is a good question. It is one all taxpayers in this country should be asking themselves, because it is not just on this fuel tax issue where we seem to get taxed beyond the necessity to run an effective central government. We now have a government that is spending money on an awful lot of what people would call boutique programs or programs that could very well be better and more efficiently run at a different level of government.

This is all about a government that is happy to take our money in ways that it thinks we will not notice in order to try to spend it on us in ways that it hopes we will notice and give it credit for. It is all about optics and appearance. The Liberals actually think that people do not really notice this money being taken from them at the pumps, for example. That is all the wrong kind of logic to use if one is legitimately interested in running the country based on principle rather than politics and opportunism.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Madam Speaker, I followed the reasoning of the hon. member who explained that the federal government takes in more taxes than it needs, for example with the GST. I would like him to apply the same reasoning to the huge profits the oil companies make in the circumstances. That is a world problem. Indeed, when the price of oil increases rapidly, oil companies make indecent profits on refining.

I will ask the Conservative member the question I asked earlier today. In the last 30 days, the average amount oil companies cashed for refining is 26.1 cents a litre. Over the Labour Day weekend, the price per litre was 46.4 cents on September 2 and 39.3 cents on September 3, 4 and 5. In the last 30 days alone, oil companies made profits of $1.4 billion, which is $800 million more than on the same days last year.

I would ask my colleague to use the same reasoning. I agree with the government using part of its revenues to help those most in need. However, oil companies must be brought to heel so they stop making indecent profits on the back of taxpayers. For 30 days, they overcharged between 20¢ and 35¢ a litre for their refining profit margin.

Would the hon. member agree with me that we must create a petroleum monitoring agency to bring them to heel once and for all?

[John Duncan, Conservative, Vancouver Island North, BC]

Madam Speaker, I have no objection to some form of petroleum monitoring agency. The November 2003 committee report recommended that the Competition Bureau be given a lot more resources to do this kind of thing, rather than set up a different bureaucracy. Perhaps we can do both. This is probably something that will have to occur.

Our refining capacity is so constrained and so tight that we are going to be subject to these kinds of problems every time there is a catastrophe, unless we can increase the supply. Increasing supply has a lot to do with the government as well.

[Walt Lastewka, Liberal, Parliamentary Secretary to the Minister of Public Works and Government Services]

Madam Speaker, I am sharing my time with the member for Laval—Les Îles.

It is a pleasure for me to take part in the debate on the rapid increase in the price of gasoline and fuel costs. The price of gasoline has reached some high levels and the forecasts for the future also show little chance for too much relief.

There have been calls for all levels of government to ease gas prices by cutting their taxes, freeing up reserves, offering rebates, perhaps targeting rebates and so on. The fact is, and we have heard this over and over again tonight, that the federal excise tax on gasoline is calculated per litre. We have also heard that the 10% remains whether it is 80¢ or $1.80 per litre. The GST floats, but I believe very strongly, and I am reassured even again tonight, that it would be better to return some of the GST to communities rather than to the petroleum companies.

I hope that all parties involved, the federal and provincial governments, oil and energy industries, and consumer groups have more discussions and take some action on how we can better manage our energy resources.

I recognize that pump prices are a reflection of international conditions over which we have little or no control, especially when it comes to hurricanes and natural disasters. Embargoes or wars in oil producing countries have also resulted in higher energy prices. This has the potential of bringing our economy to a standstill. I believe that by working together and having some good discussions we can make some inroads. With winter approaching, every family could be further strained with gas prices and fuel costs. Eventually consumer goods and food will be impacted because all of these items are normally transported from point to point and as a result costs will go up.

I believe strongly that the plight of low income earners and seniors, especially those on fixed incomes this winter, must be a particular concern to all of us in the House. I understand there have been some increases already in Ontario with respect to the cost of natural gas. The increases this winter will cause a lot of hardship and will cause people to make decisions on where to spend their money. I was glad to hear the minister talk about work being done in this area. Hopefully in the coming weeks something will happen.

As mentioned tonight by the member for Algoma—Manitoulin—Kapuskasing, I was the chair of the industry committee in the fall of 2003. The committee recommended that we should have an independent petroleum monitoring information agency for the collection of information and the dissemination of gasoline prices.

Some of the debate tonight was about facts and questioned whether this was right or that was right. We need to have an agency that would provide that data. We need to make sure that we can trust the data we have in total. I know that Natural Resources Canada and Industry Canada have done some work on this, but I still believe that the government should set up a petroleum monitoring agency.

As we said in our report, it would be for three years and would ensure Canadians that they would receive information and that it would not be affected by any petroleum companies or other interference. It would be information that Canadians could believe and understand. The minister has said that he is still open to that so hopefully as a result of tonight's debate there will be some action on this.

When I filled up for gas on September 13, for example, in St. Catharines the cost per litre was $1.31 while the cost per litre in Grimsby, just several miles down the road, was $1.09. To the best of my knowledge the federal and provincial taxes in Grimsby and St. Catharines are the same. They are both located in the Niagara region in the same province of Ontario in our country of Canada. This is plain and simple gouging. I heard tonight that it is called panic marketing. That is something new.

I had a letter from one of my constituents, Sherri Hackwell of 339 Geneva Street, who asked me about the 10¢ differential between Grimsby, Beamsville and Stoney Creek and St. Catharines and the fact that neighbouring communities had different prices although the taxes pretty well remained the same. The only answer was gouging by those companies. I would hope that message has been heard loud and clear.

I would like to look at another debate and more debate from the standpoint of the complete energy situation. Should we still be in the world marketing scheme? Should we have a north-south marketing scheme? What other message should be applied for the long run? How much work do we need to do on energy conservation?

I was pleased to hear the acting minister speak to this today and give a few examples. We should know our usages per capita, by province and by region, to learn from others and how we are cutting down on the use of our energy.

I will give an example. On taxicab regulations, we can take a cab from the airport to downtown Ottawa, but that cab driver cannot take someone back to the airport, so his cab goes back empty, and vice versa.

I am sure there are many other ideas that Canadians have to save on energy. Perhaps that would help in the supply and demand and would bring the costs down. We need to be thinking outside the box a little bit.

I would hope that we would be encouraged to have more debate in the House along this line.

As a member of Parliament representing an urban and industrial riding in Ontario, St. Catharines, I recognize the need for swift action. I believe that the government will have some short term answers. However all members of the House, rather than getting into a lot of political rhetoric, should talk about how we can conserve energy, how we can better serve our country through having less demand on our energy and using our energy wisely.

I hope that we can continue on with this debate. I really enjoyed some of the comments tonight when we talked about the real things on how we can save our constituents' and Canadians' money.

[James Bezan, Conservative, Selkirk—Interlake, MB]

Madam Speaker, I am glad that we are having this important debate. This definitely is the issue that has rocked Canada over this past summer. All of our constituency offices had had our phones ringing off the wall and our phones at home are ringing with people concerned about the rising fuel costs. We are hearing a lot about future possibilities but people want relief right now.

I represent a rural riding. Contrary to what the hon. member over there was saying about his urban industrial area, there is no doubt that the people who are feeling the pinch the hardest right now are rural Canadians. People in rural ridings have the farthest to travel to get to work and to school. Our school boards are now dealing with a huge increase in costs to run their buses in rural ridings. In some cases it is adding on over $50,000 to their operating budget which they did not budget for and which they do not have. They cannot go back this year to the municipalities and ask for more money and to increase the mill rate retrospectively. They have to deal with the problems right now. Rural Canadians, such as the farmers and the truckers, are the ones who are really taking the hit here. There is a cumulative effect here that all comes down to the consumer and we have to offer some relief right now.

We have the GST which is excessive right now. We are only talking about a few pennies a litre right now but that type of relief put back into the economy and into the people's hands would have a lot more benefit.

The one thing that we have always adhered to as kind of a policy in government is that we should not be taxing food production. Most provinces already recognize that when we are producing food the provincial excise taxes are exempt from that fuel. It is time that we started considering maybe doing that at the federal level for people who use farm fuels because we do not want our food to have that excessive tax built into it.

I would like to hear some of these types of comments coming out tonight, something that we can do immediately as government, to offer some relief to industry, to farmers, to rural Canadians and to consumers so that the cumulative effect is negated as much as possible.

There is no doubt that this is a world market price spike that we are seeing. As somebody who is in farming and who has been in business, sometimes we get to enjoy those price spikes as well but there are also downturns in industry. There is no doubt that the oil and gas sector has gone through downturns as well. It was not that long ago that the price was selling at below cost production when it was sitting around 45¢ to 50¢ a litre.

Even though things are up, let us talk about some real advantages. Tax rebates to low income and fixed income Canadians with huge heating bills this winter is another way that we can deal with it. Let us talk about what we can do as government right now and that is in how we design our taxation and those policies for Canadians. That is the type of information I think Canadians want to hear coming from this place.

[Walt Lastewka, Liberal, St. Catharines, ON]

Madam Speaker, I appreciate the member's comments concerning rural areas. I happen to live in the rural area of the city of St. Catharines. I would ask him to please understand that in communities like mine many people drive an hour to an hour and 20 minutes every day to go to work because of jobs in other areas depending on the various fields. The people in my riding are not any different than people in total rural areas.

I understand the comments by the minister about having some short relief and that it requires some time and some work with the cabinet and the minister. He has only been in the job for seven hours, or I guess a little longer now that it is almost 10 o'clock, but I would hope that following his comments there will be work done in that area.

However I also strongly believe that we need to talk about those things that can conserve energy. We do this only when there is a crisis it seems but we should be doing it more often. I would hope that the chairman of the industry committee would take on that responsibility. I have had some discussions with him that we should continue on these discussions on how we use our energy and how we can conserve our energy. I will go through the blues for tonight to see how much time we spent on badgering on data rather than on ideas on how we should move forward.

I believe strongly that all the members in this House, government and opposition, working together should be able to come up with ideas from their ridings on how we could still make energy efficient improvements for our country.

It is a known fact that we North Americans drive a lot, we depend on our cars a lot and we do a lot as far as moving around. We need to take a look at ourselves to see how we can do that more effectively.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Madam Speaker, I would like to reiterate what others have said about this government's concern with the recent hike in oil prices.

Hurricanes Katrina and Rita have caused a drastic drop in crude oil production and refining; as a result, crude oil prices have been fluctuating greatly.

I should also repeat something all hon. members know: oil is not just any commodity for Canadians, or anyone around the world for that matter, because its derivatives are at the heart of our global economy.

We have all witnessed, many of us as participants, the long lines of cars waiting to fill up at gas stations when there is rumour of a new price increase at the pump. As uncertainty grows so does the demand, and the result is always the same: further increases, and I might say insane increases, in prices.

Unfortunately, the rise in gas prices goes well beyond the hit on the pocketbook that consumers feel at the pumps. As a net exporter of petroleum, Canada has seen its currency rise along with the price of oil, giving us the distinction and challenge of having what many financial analysts rightly or wrongly are calling the petrol loonie. This in turn is creating pressure on our export sector as the price of Canadian goods and services rises in foreign markets.

To make matters worse, oil and its derivatives are the lifeblood of Canada's manufacturing economy, chemical and pharmaceutical industries, which increases their costs, reduces their profit margins and heightens competitive pressures.

Even at the level of national unity and federal-provincial fiscal arrangements, the recent rapid run up in the price of oil has created, as many of my colleagues have said, tensions between the provinces, those of them that are geologically blessed with oil wells and those without who feel that all Canadians should benefit from these national resources.

In fact, no Canadian can escape the pinch of rising crude oil prices.

These are challenges with which all governments in every part of the world must come to grips, not just the Canadian government. However what concerns us here tonight is what the Canadian government must do to help the Canadian consumer.

One bright spot is that, if anything, in the global context of oil market and stability, Canadians are fortunate, believe it or not, to be living in a country that is a net exporter of these valuable commodities and that has some of the lowest gasoline taxes as compared with its major industrialized competitors. We only have to go to Europe to see what the price of petrol is, as they call it over there.

Much attention has also been directed to the role that taxation plays with respect to influencing the retail price of fuel. Accordingly, I would like to take this opportunity to speak for a few minutes to the federal taxation of fuels, namely gasoline and diesel fuels.

If we carefully examine the federal taxation we know that this shows clearly that a recent price increase is a result of the high cost of crude oil on global markets exasperated by disruptions to the petroleum supply chain as a result of the devastating hurricanes in the southern United States.

The federal taxation of fuels consists of two elements. The first is the federal excise taxes that are levied at a fixed rate and the second is the goods and services tax that applies generally to most goods and services in Canada and this includes fuels.

I would like to spend a few minutes on the federal excise tax and then, if time allows, on the goods and services tax.

The federal government levies excise taxes on gasoline, aviation gasoline, diesel and aviation fuel. It is worth noting that there are no federal excise taxes applicable to other kinds of fuel, such as home heating oil, propane, natural gas or electricity.

The federal excise tax on gasoline and aviation gasoline is levied at the rate of 10¢ per litre, while the federal excise tax on diesel and aviation fuel is imposed at the rate of 4¢ per litre.

Federal excise taxes are fixed amounts that do not vary with changes in the retail prices of fuel. This means that revenues from federal excise taxes are a function of the volume of fuel that is sold but not of the retail price.

Accordingly, the recent increases in retail prices for gasoline and diesel fuel do not have any positive impact or any impact on federal excise tax revenues. In fact, to the extent that higher pump prices cause motorists to drive less and reduce their consumption of fuels, federal excise tax revenues could actually decline.

I would like to also note that the excise tax on gasoline has been levied at the same rate since 1995, 10 years ago, while the excise tax on diesel fuel has been unchanged since 1987.

With respect to revenue, the federal excise tax on gasoline raised about $4 billion in revenues during the fiscal year ending March 31 last year. The excise tax on diesel fuel raised about $900 million, while the levy on aviation gasoline and aviation fuel contributed $80 million over the same period.

All federal excise tax revenues from fuel go to the consolidated revenue fund where they are used to support a wide range of programs that are valued by Canadians, including health care, education and programs for seniors. Contrary to what some of the colleagues across the floor have said, this is not a matter of just simply raising taxes in order to hide the money from the consumer.

What these taxes do in fact is that they are returned to the Canadian public in the form of help on health care, on higher education, on immigration and so on. These taxes do not disappear. They go back to the Canadian public.

In fact, in the budget 2005 the government delivered on its commitment to share with cities and communities a portion of the revenue from the federal excise tax on gasoline to support environmentally sustainable infrastructure.

Beginning in 2005-06, funding for this initiative will ramp up every five years for a total of $5 billion. By 2009-10 funding will amount to $2 billion per year, the equivalent revenue of 5¢ of federal excise tax on gasoline, fully one-half of federal gas tax revenues. That is only one example of where this money goes.

With respect to the environment, in recognition of the fact that renewable fuels offer a number of important benefits, excise tax relief has been provided since 1992. Another of my colleagues referred to this a little earlier, the portion of blended gasoline that is ethanol or methanol produced from renewable sources such as biomass. In budget 2003 excise tax relief for renewable fuels was extended to include the ethanol or methanol portion of blended diesel fuel as well as biodiesel fuel.

This concludes my overview of the federal excise taxation of fuel, but I would like to say a few words about the goods and services tax. This is levied on most goods and services in Canada, including motor and home heating fuels at a rate of 7% of the final selling price. This is where it hurts. This maintains a broad base which allows the GST to be levied at a relatively low rate and makes compliance with the tax much easier for businesses. Remember that when the GST was first introduced in the House, businesses, particularly small and medium size businesses, had a great deal of trouble keeping track of what they were levying on the customer and this particular system allows them to find their way through the system much more easily.

One of the key features of the GST is that businesses are able to claim input tax credits in respect of the GST they incur when purchasing goods and services that are used to make taxable supplies. This means that most businesses are able to claim full refunds in respect of the GST they pay on their purchases of petroleum products, including gasoline and diesel fuel. For individual consumers the GST low income credit is designed to help offset the impact of the GST to those most in need.

I know I will not be able to go further in what I had prepared to say about the GST, but let me say this in conclusion.

This is a difficult situation. That is why, this evening, on our first day back in Parliament, we saw fit to discuss and debate this issue that is important to all Canadians, whether they are private customers or company customers. Those who depend on their vehicles for work are feeling the pinch even more.

Members on both sides of this House are looking for a balanced approach that would relieve the pinch on Canadians while at the same time allowing the Government of Canada to deliver on the promise of assistance previously made to the municipalities. There are great needs there.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Madam Speaker, it is a pleasure for me to put questions to my Liberal colleague from Laval—Les Îles for the simple reason that it is clear in everyone's mind that there are four factors affecting gas price at the pumps: crude oil price, refining cost, profit margin and taxes.

Everyone in the House knows that retailers cannot be asked to contribute more, since their profit margin is only 2¢ or 3¢ per litre. The price of crude oil depends on the market. We are aware of that. We, in the House of Commons, can have an influence on the two other factors: refining cost and taxes.

Regarding GST, there is certainly a price increase, therefore an increase in federal government revenues. As suggested by the Bloc Québécois, the government should think about giving back the money as tax credits to the most needy in our society. We all agree on this. However, the problem is that we disagree about the means. The government is dragging its feet as much as possible to save money. In the end, citizens who need it the most are not receiving anything.

The second factor is refining cost, which we find totally intolerable and unacceptable. Since 2003, the Standing Committee on Industry, Natural Resources, Sciences and Technology has been saying that we need a monitoring agency. I quoted the numbers earlier.

In the last 30 days, oil companies cashed profits of 26.1¢ a litre on refining when we know that profits of 7¢ are considered reasonable by the industry itself. That means that in the last 30 days, they made $800 million more than for the same period last year. If the government continues to procrastinate and wait—even at today's price, which is reasonable—oil companies will cash $40 million a week over what they made last year.

That is why the Bloc requested an emergency debate. We ask the government to create a monitoring agency to bring the industry to heel. It is that simple. Oil companies are making profits on the back of taxpayers.

Today, we in the Bloc say that that must end. It is necessary that refining profits remain at a reasonable level of about 7¢ a litre. If that had been the case in the last 30 days, citizens would have saved between 20¢ and 35¢ a litre. Money would have remained in their pockets instead of going into those of the oil companies.

That is why we are asking the government to create the agency. Of course, we are also asking the government to use tax measures, for example, tax credits, to give money to the taxpayers who need it most as a means of compensating them for their losses in the last weeks.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Madam Speaker, we all agree here in Canada that competition is important, for companies first, and also for customers. Competition is indeed what keeps the prices at their lowest levels. That is something that all Canadians understand, except perhaps for a few mean-spirited people.

I would have a suggestion for the member opposite regarding a Competition Bureau. We would have to amend the Competition Act. I think that it is something that we could do. We could also encourage the oil companies, or force them, to ask for this amendment to the legislation.

[Lynne Yelich, Conservative, Blackstrap, SK]

Madam Speaker, the member suggests that tax rebates can help with some of the costs. She has made suggestions that for people driving to work, there are ways to conserve. I would like her to put herself in the position of the agriculture sector right now, where farmers need to have fuel to run their equipment for 8, 10 or 12 hours. They do not have an option of parking their machines and hoping the crop gets off. Right now a lot of the crops are under duress with some of the weather factors that have hit us. We have had a lot of rain and therefore the quality of the crops has gone down, so we are looking at declining prices. We have just come from some serious years of trade issues and problems, and now we are looking at crops that are going down in quality and price.

We need fuel to run our equipment. That is how we put the crops in and that is how we take them out. I wonder what we can suggest to help the farming industry that depends on fuel. We do not have options. We do not have biodiesel. The GST rebate does us no good if we cannot get the crops off to pay the fuel. It is getting quite serious. In fact, crime has gone up considerably because people are getting quite desperate. I would like the member to comment.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Madam Speaker, first of all, it is true that farmers are badly affected by gasoline prices. There are two factors here. The first one was presented earlier by one of my colleagues. The prices also fluctuate within a province or even within a community. This depends on the seller who sometimes takes a profit. We have to make sure that the prices remain at the lowest possible level throughout a region.

As for GST, of course the farmers receive the GST at the end of their fiscal year. This is a serious problem because they do not get it now. It is something they will only get at the end of their fiscal year. I think that some sort of agreements should be made, particularly with the provincial government, to help them get through this year.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Madam Speaker, first I should tell you that I will be splitting my time with the hon. member for Jonquière—Alma.

The main issue in this emergency debate on the price of oil is: Why is this government not taking action, considering the urgency and magnitude of the situation? After all, oil prices have doubled over the past six months.

Earlier, the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup explained the situation very well. He found the right words to discuss the oil price increase. He explained very clearly that the price of gasoline is the result of the addition of four factors, namely the price of crude oil, the refining cost, taxes and the retailer's margin. He also explained that the concentration of refining activities during the 1990's resulted in a price increase. We now know that, on average, refining plants are operating at 95% of their capacity.

The hon. member for Mégantic—L'Érable and the hon. member for Argenteuil—Papineau—Mirabel both made remarkable presentations on the profit increase enjoyed by oil companies.

This is worth repeating: in 2004, the after-tax profits of the five major oil companies in Quebec and Ontario, namely Petro-Canada, Shell, Husky, Suncor and Esso, totalled $7.2 billion. According to Bloomberg, these profits should be close to $9 billion this year.

Since 2002, the net profits of oil companies have increased by over 100%. Oil companies are increasingly richer, at the expense of consumers, small businesses, cab drivers, independent truckers, logging companies and agricultural businesses. This is sort of a diversion of wealth.

Of course, there is a geographical component that comes into play, including recent natural disasters such as Hurricane Katrina. However, oil companies took advantage of the situation to put even more money into their pockets. Someone said very appropriately that they are white collar looters.

This government is not doing anything. Why? We do not know. It refuses to see the situation.

However, the people in my riding of Saint-Bruno—Saint-Hubert are well aware that the price of gasoline is increasing, and this is nothing new. They have known this for ages. Long ago, they realized that the price of gas went up on Friday evening and went down on Monday evening. Likewise, this is not the first year that they have noticed that the Friday before the mid-July vacation in the construction industry, the price increased and, when everyone went back to work, the price went back down. They do not need big theories, explanations or analyses in order to see this.

My colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup did a realistic analysis of the situation, as I said earlier, and an excellent job of presenting the Bloc Québécois' action plan. This action plan is a excellent initiative by the Bloc. We were very insistent about meeting with the oil companies, which the Standing Committee on Industry, Natural Resources, Science and Technology did last week.

We presented an extremely well structured, intelligent action plan based on common sense and that answers a number of aspects of a problem with multiple origins.

What was this government's response? It said nothing. In fact, it said that something could be done. It started to timidly consider a few little things, as we heard earlier during the presentation by the Minister of Industry. He said that perhaps something could be done for tax credits or the Competition Bureau could have oversight. However, these little things have not been fleshed out. We do not know the details. When? What is the timeline? How many? How? There are a number of questions that have yet to be answered.

The Bloc's action plan is very detailed and very well structured. I want to give a quick overview.

First, we want to give consumers some respite and create a refundable tax credit that would minimize the impact of the high price of gasoline. We want to encourage people to move away from fuel oil and implement a tax credit for public transit, which corresponds to the bill introduced here in the House by our colleague from Longueuil—Pierre-Boucher.

What we also want—and my colleague from Jonquière—Alma will also speak on this—is to help the people in the outlying regions, to expand the coverage of the $3.75 daily fiscal deduction, up to 10% of income, already available to regions that are at a very great distance from major centres. It would be a very good thing if this government were to heed us and implement some of these measures.

There are others. We want to help the economic sectors that have been affected, particularly the taxi drivers or cab owners. Independent truckers, farmers and forest industries are all heavily impacted by the rising oil prices and need to be helped.

The industry needs disciplining as well. It makes no sense. As my colleague from Argenteuil—Papineau—Mirabel has just said, the oil companies are lining their pockets thanks to the profit margin in refining. An oil sector monitoring body needs to be created.

It is my sincere belief that giving new powers to the Competition Bureau will be insufficient. Of course the Competition Act needs strengthening, resources need redistributing, $500 million need to be added to the taxes on oil companies in order to fund these assistance measures and reduce our dependency on petroleum products.

We must admit that we have all become keenly aware of the environment in the present circumstances. We are, of course, attuned to the use of oil products. We try not to use too much of course, but we also each in our own way are trying to find individual solutions to the collective problem of our environment and asking ourselves how we can each do our own little bit toward reducing our oil dependency.

There may be something the government could do to help consumers find solutions: encourage the building and purchase of vehicles that consume less fuel. That would be an excellent solution.

Why does this government not recognize the seriousness of the problem and why does it not try to find some solutions? Why is this government holding on to its position and insisting on doing nothing?

The member for Burnaby—New Westminster has already described the situation as incomprehensible. I do not think that is the case. In fact, I think there is indeed a reason for it all. I have some trouble formulating that reason, however, because this is a sad situation I want to see changed. This government is more attuned to the greed of the major oil companies than to the real financial difficulties being experienced by consumers and small business. If there is anything that needs to be changed, that is it.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Madam Speaker, I would first like to congratulate my colleague for her excellent speech. She described the problems quite well.

My question will be simple. The Liberal Minister of Transport told us on August 26 that the federal government could not do anything. In the comments that my colleague just made, there are many solutions that the Bloc Québécois is proposing to the government. I would like her to take the opportunity, once again, to share her thoughts about the situation. Indeed, the situation is totally unacceptable.

Today, the Bloc Québécois, on the first day of the resumption of the House, called for an emergency debate that was agreed on by the other parties. We want to thank them for that. The situation is intolerable. The Liberal Minister of Transport said on August 26 that the government could not do anything. Today, my colleague gave some examples and I will ask her to continue to do so. I congratulate her once again for her excellent speech.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Madam Speaker, I thank my hon. colleague from Argenteuil—Papineau—Mirabel for his excellent question.

On August 26, the Minister of Transport said there was no solution to this problem. But in the light of tonight's emergency debate and the action plan put forward by the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, we can see that there are solutions, such as offering consumers some respite; providing assistance to those living in remote areas; supporting the affected economic sectors; disciplining the industry; redistributing wealth and reducing our dependency on oil. These are objectives that can be achieved with concrete measures.

In addition, this emergency debate requested today by my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup has seen some government members open up somewhat. The Competition Bureau was mentioned, perhaps with new powers. It was also suggested that a modest tax credit or other incentive be provided to those who convert from oil heat. The hon. member for St. Catharines commented that this was a great opportunity to ask the right questions about how to protect our environment and use our energy. Finally, the hon. member for Laval—Les Îles, on the government side, agreed that it might be a good idea to perhaps consider some tax credits.

As you can see, Madam Speaker, where there is will there is a way. Where there is a political will, things can be achieved.

Earlier, my conclusion was very sad. I cannot think of a better word than sad, or unfortunate. It is indeed sad to think that this government is more sensitive to the greed of the big oil companies than it is to the needs and financial difficulties of consumers. Let us hope that we can get things moving with a debate like this one, another debate requested by the Bloc Québécois.

[Larry Bagnell, Liberal, Parliamentary Secretary to the Minister of Natural Resources]

Madam Speaker, I too would like to thank the member for her positive contributions.

Just to outline the Liberal philosophy in the energy crisis, it is to work on both the supply side and the demand side. That is why we have had a number of programs on the supply side. If there is not enough oil and natural gas with prices going up we have invested heavily in new renewables, wind energy, solar energy, ethanol, and a great deal of research in different ways so that we can get off fossil fuels, not just because of crises like this, but also because of the effect that fossil fuels have on greenhouse gases.

We also think we should work on the demand side so that we can reduce demand and use automobiles less. We have helped thousands of Canadians through contributions to energy efficient homes. We have one of the most modern auto emission voluntary reduction packages in the world.

As the member mentioned, I have been lobbying for changes to the Competition Act to make it even more effective. We have many tools in place.

The Bloc in this debate has suggested an interesting tool to which I am not opposed. I was on the industry committee when we discussed it. That is a body that would give out information and monitor the prices and make sure the public knew all the details of this complex industry at the various levels where things occur.

I wonder if the member could elaborate in detail on the Bloc's proposal for this agency, on some of the benefits this agency could provide to make sure that we get fair prices at the pumps for consumers, especially for those who are most in need.

[The Acting Speaker (Hon. Jean Augustine)]

Since there is very little time left, the member for Saint-Bruno—Saint-Hubert should give a very brief answer.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Madam Speaker, I will be pleased to answer my colleague at another time, since I do not have the time now to do it. However, a monitoring agency is very much needed.

[Sébastien Gagnon, Bloc, Jonquière—Alma, QC]

Madam Speaker, firstly, I would like to commend my colleague, the member for Saint-Bruno—Saint-Hubert, for her speech and explanations concerning the plan proposed by the Bloc Québécois.

Let me also commend another colleague who has worked very hard during the summer and who has invited the Standing Committee on Industry, Natural Resources, Science and Technology to sit even before the beginning of this session. I am talking about the member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

Let me also explain or participate in this debate from an angle corresponding to the file in which I represent the Bloc Québécois interests, that is regional development.

In the past five years, certainly for the past three years that I have been in this House, major crisis have directly affected the economy of the regions of Quebec.

There was the softwood lumber crisis which is still on right now. In my region, between 3,000 and 5,000 jobs were affected, which is enormous for a region like mine.

There was also the mad cow crisis. We are still feeling its consequences all over, especially the farmers and dairy producers. They are still waiting for the money from Ottawa.

We also had plant closures, and this is important. As we know, in the context of globalization, many businesses will produce twice as much while providing only half as many jobs. They will often choose to export their expertise to other major international centres, which will result in plant closures and job losses.

I think we all agree that we do not need other labour disputes in the Saguenay—Lac-Saint-Jean region or, at least, other catastrophes. Yet, our region was dealt another blow in recent months with the gasoline price increase.

I could go on and on. If I may though, I would like to mention a few concrete examples to show how my community is affected. The fact that my region is located far from the large urban centres means that this gasoline price increase has a negative impact on all consumer products.

I would like to mention a personal example. In addition to the gasoline that I buy for my car, I purchased a consumer product not long ago, because I wanted to switch from oil to wood to heat my house. What really took the cake is that I had to shell out an additional $200 in transportation costs compared to what people living in large urban centres have to pay. So, it is costing me $200 more to switch from one heating technology to another, but this is because of the gasoline price and transportation costs.

If I, as a member of Parliament, experienced this, so do all Quebeckers.

Some solutions are being proposed here by my Bloc Québécois colleagues and myself, and I am urging the government to listen carefully. It must pay attention to these solutions. We did our homework this summer and, contrary to the government, we did propose an action plan with concrete measures. If the government does not have the courage to come up with something, then it should listen to our plan, it should recognize our needs and then it should take appropriate action.

Of course, we are proposing, in the case of those who are directly affected—these are often low income earners, but they also include all consumers—refundable tax credits of $250 per person to alleviate the impact of the price increase for oil products.

Measures could be proposed—that is what we are doing—to compensate car owners. Although some individuals cannot consider alternative means of transportation—as is the case in small villages in my community where there is no public transit—there needs to be measures to encourage them to decrease their dependence on oil, and to consider using hybrid cars, for example, or other technologies. We must encourage the purchase of less energy consuming vehicles.

Earlier, I mentioned consumers who have been affected when it comes to fuel oil. This point is important. We know that regions in Quebec that are somewhat remote record very drastic temperatures. The thermometer can dip to 30 and 35 degrees below zero. It can get even colder if you factor in wind chill.

We cannot hesitate. We need effective measures because there is a risk. I want all hon. members to be aware of this situation. For example, when individuals who heat with oil are faced with astronomical costs, they still have to heat their homes, even if they do not have the means to do so.

My fear is that they will use alternative makeshift means. This is not rocket science. We saw this happen during the ice storm in Montreal a few years ago. People used makeshift propane systems and other alternative means. That is why we need an aid plan and ways to help these people and protect their health and safety.

I also want to draw your attention to a case. It is the case of a nice family business. My own father worked there a number of years ago. I have the utmost respect for this company. Recently, it had to stop some of its fruit and vegetable delivery service in the community because it could no longer compete with the larger centres. Why? Because of the increase in the price of gas.

We cannot ignore these situations, especially since they lead to the loss of jobs. For small communities like Métabetchouan with its 4,000 inhabitants, the loss of four or five jobs is a big deal.

There is also a way to help the remote areas. The government is already doing it with the very remote areas where it provides a tax deduction of $3.75 a day, up to 10% of income. What I am proposing to the government today is to extend this measure to all the regions, the Saguenay—Lac-Saint-Jean, the Abitibi or the North Shore. These regions are directly affected by transportation costs.

Other economic sectors have also been affected. I was talking earlier about the softwood lumber crisis. And let's not forget the mad cow crisis. The farmers are already having a difficult time. Can we try to give them tangible help? They must use their farm machinery to extract resources and their income from the land. They need our help now.

The softwood lumber crisis affected the forest industries and cost some 3,500 jobs in my region. Close to 5,000 jobs were affected. The EI gap creates major havoc in my region. Can we try to find ways to help the forest industries?

In closing, I would like to congratulate some people back home, of whom I am very proud. They have been manning the stockade and demonstrating against the rise in gas prices for quite some time now. The man leading this group is Mr. Claude Girard, an accomplished volunteer. In fact, along with his executive board, he is preparing a demonstration for this Thursday. The event will take place in front of the Jonquière Tax Data Centre in order to send a clear message to this government, which has not lifted a finger yet. What Mr. Girard wants is to motivate the government to take action. For regions like ours and all across Quebec, this crisis has had major and profound impacts.

This is a national movement. We know that national union representatives will be demonstrating at our side. There will be people from UPA and independent truckers. I am inviting the public to take part in this peaceful demonstration in order to send a clear message to this government, which did not do anything but which has a duty and a responsibility to act. The only thing the government lacks is political will and courage.

[Larry Bagnell, Liberal, Parliamentary Secretary to the Minister of Natural Resources]

Mr. Speaker, perhaps the member was not here when I outlined the many steps the government has taken on both the supply side and the demand side to deal with energy shortages.

I have two questions for him about solutions. At the end of his speech he mentioned a group that is having a demonstration. Are the solutions the group proposes the same as the Bloc solution, the monitoring agency, or is that group proposing other solutions?

My second question is with respect to the tax credit. I just want to make sure that I have all the details. To whom does the tax credit apply? Is everyone eligible for that credit? Being non-refundable, would someone who does not have an income get a rebate of that credit? I just want to understand more of the details.

[Sébastien Gagnon, Bloc, Jonquière—Alma, QC]

Mr. Speaker, let me start by pointing out to my colleague the concerns of the Association pour la protection des consommateurs de carburant, which is responsible for this movement in Saguenay—Lac-St-Jean.

At the Standing Committee on Industry, Natural Resources, Science and Technology, the Bloc Québécois recommended the creation of a petroleum monitoring agency among other things. The members of the committee totally support that.

Earlier, my colleague was asked how this could be done and what our vision was. Perhaps I could enlighten the hon. member by summarizing the role that this office could play.

It could collect and release data on refined petroleum product prices in the American black market; publish an annual report to inform the public about the competitive aspects; assign witnesses and ensure their confidentiality; study every aspect of the petroleum industry; suggest solutions to put the petroleum product sector in order. The consumer protection coalition brings an interesting dimension that the Bloc Québécois has also explored.

Currently, concrete measures are needed, because there is a crisis. People feel its immediate impact. We have no choice but to react. However, we ought not always to be in reaction mode. Instead, we must look to the future. We need to try and sever dependency links or, at the very least, to stop having our hands tied when it comes to the oil sector. We have to propose alternative solutions, which would allow us, for example, to switch from fuel oil to other energy sources for heating, and to vehicles that only use fuel.

I was mentioning earlier that I am from a remote region. A lot of people there use utility vehicles, large pickups and big trucks. We should develop incentives for those people to move away from their 4 x 4s and try and find other solutions, taking into account the characteristics of the area.

The coalition hopes for long-term measures. I think it is up to all parliamentarians to ponder those issues, in particular in the Standing Committee on Industry, Natural Resources, Science and Technology, and to propose solutions in cooperation with all parliamentarians. At the present time, the need is urgent, hence the idea to propose certain measures so as to mitigate immediate effects.

We want to see a tax credit going directly to the consumer, as that seeks to offset the effects of higher oil prices for households, particularly in relation to heating and to the food basket, which result from the rise in transportation costs. Indeed, as I was mentioning earlier, even though some people may not be driving in the regions, the impacts are felt nonetheless. I gave an example about the consumption of a given good, but it is the whole food basket which is getting hit, as well as public transit. The community as a whole is suffering the effects.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Mr. Speaker, very shortly, I want to tell the hon. member that what we propose is contrary to what the Minister of Transport said on August 26, when he told all the newspapers and other media that nothing could be done, that the Liberal government could not do anything. Finally, what the Bloc proposes are short term solutions: let us give tax credits to forestry and agricultural businesses, to taxi and trucking companies.

A few minutes ago, the hon. member for Laval—Les Îles was telling us that in the end, those people can deduct their gas expenses. Of course, they can deduct expenses. The problem is that there is no income. That is why we say that the government must compensate and give revenue back to taxpayers. That kind of tax credits could allow businesses in the regions to increase their profit margins. That is my question to my colleague.

[Sébastien Gagnon, Bloc, Jonquière—Alma, QC]

I am sorry, I do not know if I understood the question correctly. It is important to understand the nature of the credits that are proposed for households, for example. All moderate income households, no matter what source of energy they use, could receive a $250 refundable tax credit. That is important for 2005-06 because there is an urgent need. We are only reacting to the crisis and we must find short-term solutions. Of course, the maximum eligible revenue for the tax credit would be determined by Revenue Canada so as to include about 6 million households having a moderate income.

I will finish by pointing out that the credit would apply to households earning less than $30,000.

[Bryon Wilfert, Liberal, Parliamentary Secretary to the Minister of the Environment]

Mr. Speaker, I would like to inform the House that I will be splitting my time with the member for Madawaska—Restigouche.

Clearly, Canadians are facing difficult times because of rising fuel prices. They want to see accountability from the Government of Canada, the provinces and the oil companies. The price of crude oil has gone up significantly since 2002, from roughly $20 U.S. a barrel to just over $60 U.S. a barrel. Part of that is because of increase in demand from countries like India and China. Although they only account for 10% of the world demand, they in fact represent over a third of the growth in demand.

The federal government does not constitutionally control the price and distribution of most goods and services in Canada, including the price of gasoline. We do not have that constitutional authority, so if people suggest that the Government of Canada somehow should deal with the price today, then they only need to look at the provinces. They need to look at provinces like Prince Edward Island which has a regulated regime, or Nova Scotia and New Brunswick to a degree.

In Ontario, in 1975 there was going to be a 5¢ a gallon increase and the Conservative government of the day decided to put a freeze on it for 90 days. It had that constitutional authority. If the issue is to deal with prices, it can either freeze the price today or it can roll the price back. It has that constitutional authority. Whether it wants to act of course is a different issue, but the reality is that on the issue of prices it is in the purview of the provincial government.

The federal government deals with the issue with the Competition Bureau. In 1998, I and 46 other colleagues on this side of the House dealt with this issue when we set up a Liberal caucus committee dealing with the whole issue of the oil industry. We made a series of recommendations, some of which were adopted by the government of the day, in order to deal with the issue of prices soaring at any one moment in time and then taking forever, it seems, to come down.

We called all the major oil company executives before our committee. If I were to tell members that they told us they do not make a lot of money on oil but they make it on selling potato chips, dry cleaning and ATMs, they might chuckle, but that was what they told us. I would suggest that if we called them today, we would see that in fact part of the reason why they are making significant dollars is that there is a lack of competition in the marketplace, particularly among independents. The Competition Bureau can and has stepped in, in the past, when one major oil company takes over a certain part of the market in which it will affect others. That happened in the province of Quebec with Petro-Canada at one time.

The authority to deal with anti-competitive measures is with the Government of Canada. I personally believe that the Competition Bureau needs to be strengthened. We need to look at ways to deal with that. Some have suggested there is collusion in the market, and I would suggest that trying to find a smoking gun is very difficult.

There have been at least 11 or 12 prosecutions with convictions over the last dozen years or so, but it is to find that smoking gun. Everyone says that the oil companies are in collusion but again we have to have evidence in order to prosecute and that is a difficult thing. However, when the Competition Bureau has evidence, it does take action. Obviously we cannot have anti-competitive behaviour in the marketplace.

There may be a solution. I listened to the Bloc this evening talking about some kind of agency. Maybe we could say to the oil companies that if they are going to raise the price of gasoline by more than 1¢ there needs to be a 30 day notification. Maybe there needs to be some mechanism, but clearly the bureau needs to have those tools. It is high time for a very rigorous review of the powers of the Competition Bureau and what it can and cannot do.

The issue of taxes, which we have heard a lot about tonight, is not the issue. In 1992 the province of New Brunswick reduced the tax by 2%. The consumer did not see that because the oil companies immediately filled the void and raised the price. Cutting the excise tax by 3¢ would have very doubtful results because unless there is a regulatory regime in place that is going to clearly monitor and check that the 3¢ reduction is passed on to consumers, it will not make much difference.

I would point out that when I was parliamentary secretary to the Minister of Finance back in 2002 during that particular oil situation, the Government of Canada and the Minister of Finance of the day suggested that he would stop collecting the tax if the provinces followed suit. Maybe one province actually responded to that. The provincial taxes ranged from 15¢, 16¢ or 10¢ a litre, and they were not prepared to give that up.

The issue really cannot centre on taxes because the issue is whether or not there is competition. The issue is how to make sure, if we want to regulate this industry and obviously some would suggest in this House that we regulate it, that in fact if we are prepared to do that then we need to have the kind of regime in place that has the power to do so.

We need to have accountability from the oil companies. If one had been through the experience that I and others were, one would not believe some of things that we heard from oil company executives. They basically said that there is no question that there is a world demand. There is the impact that it has here, but it still does not account for the fact that prices spike significantly one day by 20¢ or 30¢ and then take forever to come down.

The Government of Canada has indicated through the Minister of Finance and through the Prime Minister that we are looking at ways to help assist Canadians during this difficult period. There is no question that fuel has the biggest impact on everything, whether it is in making pizzas, delivering them or getting the ingredients for those pizzas, or anything else. Fuel has an impact.

With whatever regime, if in fact we want to go ahead and put it in place, we have to remind ourselves that it will have to be there for a very long time. But if the price of hydro goes up or heating oil, again one has to look to the provinces. In terms of pricing, it is a provincial jurisdiction. I have not heard a lot about that tonight because that is their domain. It is not our domain and even if we wanted to, the only time I think we could ever become involved is in an emergency situation such as in a time of war. We would certainly hear howling from the provinces if we intruded on a jurisdiction which obviously some of them are not prepared to even exercise at this point.

The issue that I hear from some members relates to taxes. Again, there is no guarantee of savings and in fact, whether the price is 80¢ a litre or $1.30 a litre, the federal tax does not change. What does change is the fact that the government has taken an aggressive stand on renewable energies. It did so in the budget of 2005 which some did not support.

This is the government pushing ahead on ethanol as an example. This is a government that is clearly committed to higher fuel standards for vehicles and is committed to all sorts of renewables. But those are clearly more down the road.

There is an immediate impact on families who are suffering today. The action the government will take will obviously have to be one that will not create a bureaucratic situation. We did try to assist in 2002 with rising costs in the area of heating oil and we were accused of giving cheques to dead people. People did die, even though they were on the list, after the cheques had gone out, or some went to jail.

I do not know whether we want to go down that road again, but I think we need to have a monitoring agency that has the proper tools, through the Competition Bureau, to call for accountability from the oil companies, to say that within 30 days if they are going to increase the price by 1¢ a litre they would have to report and would not be able to raise it until the time was up. There has to be some surety in the marketplace if in fact this is what members want to do. While I think all members seem to agree that they want to take action, the question is what kind of action should we take.

Constitutionally, if we want to freeze the price of gas or roll it back, we have to phone our members of the provincial legislatures because they have that constitutional authority. We will deal with the Competition Bureau which I think the House should really be looking at by giving it the proper tools. Let us move ahead and assist Canadians in this difficult time that they are all facing.

[Paul Crête, Bloc, Rivière-Du-Loup—Montmagny, QC]

Mr. Speaker, I am very happy to hear the member finally say that the Competition Act needs real teeth. The Bloc Québécois has been saying this for the past five years.

If the government really ends up doing the right thing, we will most certainly cooperate. The Competition Act clearly needs to be tougher. The situation has been left to deteriorate. Today, the government is only taking small steps, piecemeal, such as to help the most needy. This help is essential, and the Bloc Québécois has been asking for it in its global plan for a long time.

Finally, are we going to have to wait for the five ministers involved to appear before the Standing Committee on Industry, Natural Resources, Science and Technology? Would it not be better if the Prime Minister himself made a formal statement recognizing the irresponsible gas price increases as a major problem and putting forward an action plan from his government?

For now, no one from the government has expressed any political will about this problem. We have succeeded in raising the members' awareness. I thank them. Could we not expect a similar attitude from the Prime Minister? As of now, the little people and small businesses continue to be the most affected by the crisis. This is unacceptable.

[Bryon Wilfert, Liberal, Richmond Hill, ON]

Mr. Speaker, in fact, both the Minister of Finance and the Prime Minister have indicated that they are looking at specific measures now to help alleviate the problem for Canadians.

It is not necessarily going to be a magic bullet, but it is going to be, I presume, an approach that will assist those middle and low income families and small businesses that are particularly affected by the rising price of fuel. There is no question about that.

Again, and I agree with my friend across the way, the Competition Bureau needs to have serious changes made to it to give it the power. Yes, it does all these investigations. Yes, it does try to find the smoking gun. Part of what it does not have is to say to the oil companies in Canada that if they want to raise the price by x amount, there is a cooling off period of, I suggest, 30 days as an example.

That is the kind of thing I would like to see the Competition Bureau have, so that it has not only the power to investigate and prosecute, but also in terms of its monitoring ability is able to say that these are the rules if oil companies wish to increase the price.

The average person, including myself, who goes in to buy gasoline cannot understand why the price seems to fall slowly at night, suddenly jacks up in the morning because of impacts. We talk about hurricanes and so on, but some of the companies are not importing American oil. We have not had the impacts.

Yes, there is a refining capacity issue. There is no question that it needs to be addressed, but again, that is not something directly that the government has a direct say in.