Mr. Speaker, I rise today to speak to Motion No. 164, which reads as follows:
That, in the opinion of this House, the government should establish, in compliance with international agreements, a policy of assistance to the textile and clothing industries in order to enable the industries to compete throughout the world, particularly by broadening the Technology Partnerships Canada program to include these two sectors....
I recognize that this is a very important issue for the province of Quebec and for the entire Canadian clothing and textile industry. We in the Conservative Party are committed to a real and sustainable industrial development policy.
I looked into the background of this motion. In December 2005, the federal government announced a program for the textile sector to, first of all, eliminate the tariffs on fibre and yarn imports. That was worth up to $15 million a year. There was also the elimination of tariffs on imports of textile inputs used by the apparel industry. That was worth up to $75 million a year. All of this was effective as of January 2005.
Additional funding of $50 million was provided to the textile production efficiency component, better known as CANtex, over the next five years. This encouraged Canadian textile companies to shift to higher value added products, focusing on niche markets and improving productivity. The program extended current duty remission tariff reduction orders benefiting textile and apparel manufacturers for five years, gradually phasing out benefits over the final three years.
This followed much pressure from all of the opposition parties to address the impending January 1, 2005 removal of textiles and clothing quotas. A Bloc day motion on February 9 called for industry support for the textile sector of $50 million over five years as well as an aid program for older workers and the invoking of special safeguard measures under existing trade agreements. The Conservative Party supported this motion. It was passed by the House.
On November 30, 2004, the Subcommittee on International Trade, Trade Disputes and Investment studied the issue. It was here that the Bloc first raised the issue of assigning part of the Technology Partnerships Canada program to research and development, for example, in this industry for the first time.
On November 30, 2004, an NDP concurrence motion was introduced on the issue of duty remission orders, which was consistent with our Conservative call to extend for a further seven years the duty remission orders covering the apparel sector.
My observation is that there is an inherent contradiction between the textile and apparel sectors about government action. The inherent contradiction with the textile industry is the concern that Canada already provides duty free entry for many fabrics used in garments made in Canada. The apparel industry is concerned about duty free entry for some garments that are 100% made outside of Canada. The textile industry struggles to find domestic markets within the apparel industry when garments made in other countries from Canadian fabrics are fully subject to duty.
This observation makes it clear that there is a need for further government-stakeholder consultations to agree to a whole industry approach to this issue.
We favour reducing subsidies to for profit businesses, but the tariff eliminations must be phased. There must be a phased reduction of duty remissions which benefit the domestic industry and the industry support commitments.
We must work with international organizations and individual nations to reduce protectionist policies to secure free trade agreements, and where there is injurious harm caused by a trade action we must have a reasonable chance of winning and/or reversing this action. We must support the industry on a temporary basis until the trade action is resolved.
This approach should not only reduce but eventually eliminate these subsidies to for profit businesses by focusing on improving overall economic growth through facilitating competition, improving productivity, streamlining regulation and fostering innovation in concert with free and fair trade agreements.
Technology Partnership Canada is not really designed to be an adjustment program for established industries, but to encourage new and emerging sectors to maturation. Therefore, it is not clear that the mandate of Technology Partnerships Canada extends or is appropriate for the clothing and textile program and that there may be another government program or service line that would better address this industry's needs.
We support an examination of programs delivered by Human Resources and Development Canada to assist all the workers, not just older workers displaced by changes in the textiles and clothing industries.
The apparel industry is the 10th largest manufacturing sector in Canada and the second largest in the province of Quebec. As of 2002, over 94,000 Canadians have been employed in the apparel industry, with an annual payroll of $2.3 billion. We recognize how important the apparel industry is to Canada and to Quebec.
The Canadian textile industry provides direct employment for almost 50,000 Canadians and indirect jobs for many thousands more.
The differing positions within the textile and apparel industry suggests that more work needs to be done by both the government and stakeholders to agree on a plan for the evolution of this Canadian industry. We have an appreciation that we must have a transition period in place so the industry can be encouraged to adapt to the new market conditions.
Again, I realize it is very important for Quebec and the entire Canadian clothing and textile industry. We are committed to real and sustainable industrial development policy. However, the Technology Partnerships Canada program I do not believe is designed to be an adjustment program for established industries, but to encourage new and emerging sectors to maturation, upon which time the Technology Partnerships Canada loans must be repaid.
Therefore, it is not clear that the mandate of Technology Partnerships Canada program extends or is appropriate for the clothing and textile program and that there may be another government program or service line available which would better address this industry's needs.
We would recommend also that we broaden the directive to the government to seek solutions from Human Resources and Skills Development to approach the labour market rather than narrow the focus on the program.