Debates of June 1st, 2006

The House resumed consideration of the motion.

Opposition Motion--Gasoline Prices

[The Speaker, Liberal, Peter Milliken]

When the matter was before the House a short time ago, the hon. member for Etobicoke North had the floor. He has a minute and 30 seconds remaining in the time allotted for his remarks, followed, of course, by five minutes of questions and comments. I call on the hon. member for Etobicoke North.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, in the short time remaining I will summarize what I said earlier and perhaps add a point or two. The motion before the House is flawed. There are resolutions to this issue through the provincial governments by regulating prices at the pumps, and there are solutions available from the Conservative Party based on its own pledges and its own position while it was in opposition.

I was getting to the point of talking about how I think energy costs are inexorably on the rise. It is a matter of supply and demand. There are some who are saying that we are entering a point of what we call peak oil. In other words, the oil supply has peaked. There are other professionals who debate that. Nonetheless, we know that more demand and less supply moves the price upward.

I think that what we need to do, as I was mentioning earlier, is look at alternatives to conventional petroleum products. We need to look at biofuels, hybrids and fuel cells. That is why the Liberal government supported the research and development being undertaken by Ballard fuel systems. We need to look at solutions like hydrogen and a whole range of other technologies to help bring forward different types of fuels that will reduce the demand for the typical hydrocarbon solutions.

Finally, in conclusion, I would like to point out that with respect to a monitoring agency, in October 2005 our Liberal government introduced measures to strengthen transparency by announcing an office of energy price information to monitor energy price fluctuations and to provide clear information to the Canadian public. Also, funds were allocated to Industry Canada to beef up the Competition Bureau in its examination of questions that come up from time to time with respect to gasoline pricing.

I hope the government follows through with those initiatives because I think they will help, but I think the motion before the House today is flawed and I certainly will be voting against it.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, before oral question period when my colleague started his speech he asked why we were debating this issue here, in the House of Commons, when this is a provincial responsibility. However, in his conclusion, he said the exact opposite.

Under pressure from the Bloc Québécois, the Liberal Party of Canada asked, before the last election, for the creation of a petroleum industry information bureau, which was a recommendation from the Standing Committee on Industry, Natural Resources, Science and Technology. This bureau has not been operational under the current government since the current Minister of Industry decided to put it on ice and think about it. That decision is not operational.

That is one of the reasons why we are taking this up today. Furthermore, we want to strengthen the Competition Act. There is nothing more federal than the Competition Act.

The hon. member's own government did indeed table amendments last fall, following hearings of the Standing Committee on Industry, Natural Resources, Science and Technology that I had asked for and were held before Parliament resumed sitting. Again, this is a federal jurisdiction.

The last point I want to make concerns the surtax on oil products. As far as I know, taxation can be federal or provincial. The hon. member's argument does not hold in any way.

In this case, the Liberals are hiding behind their inability to put in motion what was needed to act appropriately when they formed the government. Today, the public is calling for concrete measures to harness the sector. It is not a question of having a price regulation agency. It is a question of monitoring this industry, making recommendations to the House and being able to change things. The current fluctuations in price, this yo-yo game, have very negative effects on consumers and have significant consequences for industry.

For all these reasons, I would like my colleague to explain how he can justify that this was not a federal responsibility. We took our responsibilities in this matter. We are speaking on behalf of our constituents, of consumers, businesses, the manufacturing and transport sectors, of all those who want export to work in North America. Is that not reason enough for us to get support from this House?

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, I greatly appreciate the comment of the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

As I said previously, some aspects of the motion before the House today fall within the jurisdiction of the federal government. However, the motion also contains aspects that provincial governments can do something about, for instance when it comes to setting gasoline prices at the retail outlets.

As I have also said, our government has set up an agency to track gas prices and ensure a follow-up, so as to keep the public informed.

I come back to the point that the Conservative government has options it can exercise, which I would agree with, but I think the motion is fundamentally flawed the way it is presented to the House today.

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, in his remarks, the member suggested that we had come up with our motion sitting around at Tim Hortons. He should know that not all caucuses meet at Tim Hortons to draft their motions and bills, as is now the practice of the Liberal caucus. If he drafted Bill C-19 while snacking on Timbits, that was not consistent with House usages, especially since we had to give the Liberals a hand.

With respect to Bill C-19, I should point out that this bill had to be strengthened in 2005 by raising the maximum fine for conspiracy from $10 million to $25 million and broadening the competition bureau's power to investigate, allowing it to investigate industries within its jurisdiction.

We had to give the Liberals a hand; otherwise, they would not have been able to do a thing.

I would like to say this to my hon. colleague. Even his own constituents should tell him that $1.08 a litre is still too high a price. In addition, taking position against allowing healthy competition is totally distressing for this member.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, I would say to the member for Shefford that I agree that gas prices are an important issue for all Canadians. However, we must compare gas prices in Canada with those in Europe, for example.

What members of our caucus said was that we wanted some additional teeth put into the competition act. The government responded and tabled the legislation to change the burden of proof from a criminal one to a civil one. I hope the Conservative government moves forward with that initiative.

We need to protect consumers but we also need to understand that there is a real world out there and we can only protect citizens from things that are logically under our control.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Speaker, I must inform you that I will be sharing my time with my colleague, the member for Sherbrooke.

In bringing forward this motion, the Bloc Québécois is saying today that the government must establish an effective plan that will give Quebec consumers some relief from repeated increases in the price of fuel, be it gas or diesel.

We are now witnessing a highly predictable scenario that, unfortunately, becomes a reality every year as summer approaches. Indeed, the vast majority of Quebeckers know that the closer we get to the summer holiday season, the higher gas prices get. We are at the point where we practically know in advance when oil companies will increase gas prices at the pump.

On top of that, people know for sure that after repeated increases the prices will come down slightly, but never to the level they were initially, even though the price of crude does drop to its initial level. It is like going up five steps and coming down three. But we never do come down from the other two. A few weeks later, it is the same scenario all over again.

It is examples such as these that are making Quebeckers very cynical about the oil companies and this government, which is stubbornly not taking any effective action to help them.

Many people in my riding have written recently to tell me that the increase in the price of fuel has become intolerable and that it is affecting all sectors of the economy, every class of society and all age groups. Workers have to devote more and more of their budget to earning a living. Young people at the post-secondary level have often to travel long distances to their training. Seniors are seeing their purchasing power and their plans stifled by these dramatic increases in gasoline costs.

I will quote a few of these people to show you just how serious a crisis we are facing, a crisis that is dramatic in some cases. A resident of Sainte-Geneviève-de-Batiscan in my riding wrote the following:

When the barrel price goes up, increases at the pump follow immediately. It should be noted that when the opposite occurs, that is, when the barrel price drops, the price at the pump takes a long time to drop, sometimes nothing happens. Who benefits?

She concludes, cynically:

Oh, yes, I forgot. It is true these companies do not make big profits.

This woman in my riding no doubt learned that the combined net profits of the five major integrated oil companies in Canada were $9.65 billion in 2005, 34% higher than in 2004 and 46.9% higher than in 2003.

The people of Quebec are not fooled. They feel they are being manipulated and are at the mercy of these companies, whose hunger for profits is absolutely scandalous, especially when a refining margin of between 4¢ and 6¢ a litre is a very good figure for the oil companies, according to the Association québécoise des indépendants du pétrole. The refining margins were at 7.2¢ a litre between 1998 and 2003—and so already extremely attractive—and reached 19.5¢ a litre in early April this year.

So people's feelings about being swindled by this industry are not based solely on perceptions. Facts show clearly that the oil companies are mistreating consumers, including those whose employment is linked directly to the use of oil.

A resident of Saint-Stanislas wrote me this:

I am so fed up with the rising price of gas. My spouse has to drive to get to work; he has no choice. It is heart-wrenching to have to pay nearly $100 a week, just to get to work. And this does not include what he puts in his chain saws, since he is a logger. He spends a total of $150 to $200 a week in gas, since prices have continued to rise.

The increase in gas prices is always the source of a series of successive increases for practically all of the products we use, beginning with the food we eat, which often has to be transported long distances.

A citizen of Sainte-Thècle wrote to me about this:

We see that all market prices are going up too quickly: first gas, then everything else goes up, too. The rising price of gas must be stopped immediately.

This is urgent. The price of gas has become the starting point for an inflationary spiral that could undermine Quebec's economy.

A citizen of Shawinigan, Mr. Émilien Bergeron, is currently starting a petition that will be presented here in the House, asking the Canadian government to take action to bring down the price of gas significantly. The Service d'aide au consommateur is supporting his action. The SAC—or Consumer Aid Services—is well known throughout Quebec and across Canada, in part thanks to its founder, Senator Madeleine Plamondon.

It is therefore time to act, and this government must demonstrate through concrete measures that it is assuming not only its economic but also its social responsibilities, by introducing measures to reduce fuel prices and bring about more fairness, particularly for those citizens who are dependent on fuel in their jobs.

The paradigm of this inflationary spiral has to be replaced by a new vision of things. Citizens expect this government to introduce specific measures to counter the appetite of the oil companies, and therein lies the full significance of the Bloc Québécois' proposals.

First of all, there is no question that the time has come to discipline this industry by passing a Competition Act that assigns real powers to an independent agency, an agency that could call witnesses, gather information and above all protect witnesses and other sources of information. Bill C-19, which had the support of the Bloc Québécois, was moving in that very direction, but it died on the order paper.

In the same vein, the Bloc Québécois is also proposing the creation of a genuine petroleum monitoring agency.

In this time when access to information, transparency and accountability are becoming more than ever essential tools for the protection of our democracy, it is vital that the government move in the direction of this proposal by the Bloc Québécois, which would provide citizens with the real information on the prices of petroleum products.

So the main purpose of this agency would be to monitor the industry by collecting and disseminating data on the prices of petroleum products refined in North American markets, and to report annually on various aspects of competition. This monitoring agency would also require the capacity to summon witnesses, ensure the protection of their confidentiality, study all the aspects of the petroleum industry, and above all propose solutions to restore order to it.

It seems to me undeniable that the creation of a petroleum monitoring agency would be extremely beneficial for all consumers, because they would then have access to information to which they presently have no access at all.

Another major element of the Bloc Québécois' proposal is that the petroleum industry must also play a role in restoring a better financial balance between consumers on the one hand and producers, refiners, distributors and retailers on the other.

Oil is a natural resource that generates economic activity and wealth to a degree incomprehensible to mere mortals. But this wealth must be shared and distributed differently than it is now. This is why the Bloc Québécois is proposing a surtax on the astronomical profits of oil companies, most of which are controlled by American groups.

A surtax on oil companies' revenues would net the government $500 million per year, which it could then spend on finding new ways to reduce our dependence on oil products.

The Bloc Québécois is also proposing taking away the tax breaks granted to the oil industry, which would force the industry to pull its fair share of the weight.

Currently, the oil industry is a real boon for Alberta, but Quebec's economy is paying the price. The oil industry is responsible for a significant portion of the increase in greenhouse gases since 1990. Growing oil exports are driving the dollar up, which is wreaking havoc on Quebec's manufacturing sector. Huge increases in the price of fuel are affecting all sectors of Quebec's economy.

The Bloc Québécois is proposing a review of natural resources tax policy so we can put an end to these gifts for the oil industry.

The final solution the Bloc Québécois is proposing is to act now to find alternatives to oil.

We must focus on this if we really want to ensure a balance between developing our society and protecting our planet.

Starting now, we must make it easier for people to manufacture and purchase vehicles that pollute less.

In closing, I would like to emphasize how proud I am to have participated in this debate, whose main goal has been to let the citizens of Quebec know that the Bloc Québécois is by their side in fighting unjustified fuel price hikes. We are with them and we will not give up.

[Patricia Davidson, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, I listened with great interest to the member opposite and I have a couple of comments.

Canadians certainly have seen the up and down cycle of gas prices many times and I think we will continue to see it. The one thing that happens is that high prices occur during volatile market conditions and those high prices are not contrary to the Competition Act.

The one question I have for the member concerns the creation of a petroleum monitoring agency. We already have the Competition Bureau which is an independent agency responsible for the administration of the Competition Act. In my estimation, the bureau is doing the job that it is supposed to be doing but it sounds as though the member opposite thinks the petroleum monitoring agency should be doing that job.

Since 1990 the Competition Bureau has conducted six investigations into allegations of collusion in the gasoline industry and it has consistently found no evidence of a national conspiracy. It has also undertaken eight successful prosecutions since 1972 for resale price maintenance in local gasoline markets.

What does the member feel the monitoring agency could do that the Competition Bureau is not doing?

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Speaker, I will reply to my honourable colleague with the figures provided earlier, including those which apply to the matter raised by independent oil companies in Quebec. Petroleum companies reap fairly good profits when refining margins are in the neighbourhood of 5¢ to 6¢ a litre. This margin is highly attractive and has been for several years. Currently, petroleum companies have a refining margin of 19.5¢.

There are questions to be raised about the roles that the organizations could have played. The Bloc Québécois' motion would create a price monitoring agency that would be completely independent from the House and that would provide much better protection for citizens than they now have.

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, I applaud the Bloc member for the motion today and for acknowledging the hard-working Canadians who are penalized by inflated gas prices, particularly those in rural areas who do not have the alternative of public transit, for example, and low income Canadians who simply cannot absorb the increased costs.

We know perfectly well that the oil companies cannot move fast enough to increase prices if they can justify it on the basis of the increased price of crude, but never do they turn around when the price of crude drops down and immediately reduce the price when it would seem to be indicated. It is a pretty selective process.

If I understood the previous question, if the Competition Act were strengthened, which is one of the provisions in the motion, I do not think there would be the need for a petroleum monitoring agency. However, the reason the oil companies are never found to be in violation of the Competition Act is that the act is so pathetically weak that the companies can do almost anything and get away with it.

I have two brief questions arising around the first provision in this three part motion which reads:

--the government should establish a plan to counteract the negative effects of repeated increases in gas prices, specifically including: a surtax on the profits of major oil companies....

Is it really the intention for such a surtax to be imposed on any profits or is the real intent to acknowledge that it is excessive profits or exorbitant profits--

[The Acting Speaker, Conservative, Andrew Scheer]

The hon. member for Saint-Maurice--Champlain.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Speaker, I would reply to the hon. member that the purpose of the motion is to better control gas prices, which have fluctuated significantly—and sometimes outrageously—in recent years.

The different types of measures proposed will have to be examined in more detail. We are proposing a surtax. At the end of the day it is the objective that counts— $500 million. This measure will allow the government to further tax oil companies and to raise additional moneys in order to diversify into alternative energy sources. That is one of the motion's objectives.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, when we talk with people about the price of oil, gasoline or heating fuel, their eyes widen. In one there is a big dollar sign, and in the other a big question mark. At the same time, we can see smoke coming out of their ears. Do not worry, it is not greenhouse gases but steam from the rising pressure that the oil companies are putting on their daily lives.

For several years now, the price of petroleum products has been trending upward. The factors behind this increase are well-known: some are understandable, others less so, and some not at all. These increases have effects that cost the world economy, the Quebec and Canadian economy, the regional economy and also family economies dearly.

During this time, the oil companies have benefited shamelessly. They have record sales, and their net profits are therefore rising. In addition, the government is lavishing gifts on them.

Fortunately, we have the Bloc Québécois. It is there to tell the government what to do, as we did with the Liberal government, although the Liberals failed miserably, unfortunately, and wasted billions of dollars without having any effect on the price of oil and missing its target when it came to assistance for the most disadvantaged.

The price of oil has increased 13% since the beginning of the year, and observers tend to think that it will reach new highs in the weeks to come.

Despite the insistent attempts of the big oil companies to convince consumers that they are well served by the current market, there is still a problem: the lack of transparency.

As we all know, millions of Quebeckers and Canadians rely on transportation, whether public or private. Whether for work, leisure or family reasons, we need gas for our daily travels. But fuel is blowing everyone’s budget these days, especially low-income families.

There are frequent changes in the prices of gas and fuel oil. Media attention and the visibility of these prices make consumers especially aware of the fluctuations; especially aware, to be sure, but mostly especially worried. Every day millions of Quebeckers and Canadians see their travel costs rise. Every day they have to deprive themselves, make their calculations, without knowing what tomorrow will bring. It is even worse in winter.

In my riding, in Sherbrooke, people have joined forces and signed petitions in the hope that the government would come to their assistance. The government must do what it can to ease their burden.

How can we remain insensitive to this situation? How can we close our eyes, as the government seems to be doing, to the worry and distress of citizens who must sometimes deprive themselves of the basics so that they can keep on going to work every morning.

Some will say that the growing economy of the Asian countries has increased demand to such a point that oil inventories are down and that the small amount available is worth its weight in gold. Others will say that innovation and development in the Asian countries have markedly reduced the working inventory of crude oil and products needed to meet a given level of demand.

The demand is increasing. Drivers are unfortunately not trading in their cars quickly enough for less energy-consuming vehicles, though often simply because they cannot afford to.

To the Bloc Québécois it is clear that the development of clean energy is the best way for the future. Our dependence on oil has to be reduced. That is the real solution, but it requires time, collective awareness and real political will.

We have often raised this issue in this House, the use of oil and oil products as a source of energy is one of the major causes of the climate changes so harmful to the planet. We have to reduce our oil bill by reducing our dependence on this product.

Quebec is on the right track since, except for Norway, it is the only society in which oil is not the primary source of energy consumed.

The increase in the price of oil has also had some very harmful effects on the economy. One effect is to artificially increase exports from Quebec and Canada, causing a rise in the worth of the dollar, and causing problems for the entire manufacturing sector, which is already suffering badly.

All this time, the oil companies are making profits like never before. In 2005, sales for Canadian oil and gas companies rose by 333.2% over 1995. But the taxes paid by these businesses to the government will fall. They will fall because the Income Tax Act allows them to deduct the mining and oil royalties they pay to the provinces. On top of that, their income tax has been decreased.

The Bloc Québécois is asking the government to impose a surtax on oil company profits by increasing the current surtax applicable to corporate tax from 4% to 25.5%. That would represent additional revenues of $500 million, which could be invested in such things as clean energy.

And finally, they are entitled to a very special tax gift: the accelerated capital cost allowance for oil sands investments. The Bloc Québécois has denounced these tax gifts on a number of occasions and will continue to do so, because what we are seeing at present is an unprecedented transfer of wealth to the oil companies at the expense of the public. This must stop.

The price increases are being met with vigorous protests and widespread discontent. The government must take the necessary measures to control the situation, and in particular must ensure that no middlemen are exploiting their position or the circumstances.

The Bloc Québécois is asking that the government bring back an improved Bill C-19 to amend the Competition Act and give the Competition Bureau the power to undertake investigations on its own initiative, among other things.

The Bloc Québécois is also calling for a real petroleum monitoring agency to be created, as we proposed in our motion back in February 2003.

I am deeply concerned about the fate of the planet, particularly in view of the inertia—not to say backtracking—that this government seems to be encouraging when it comes to environmental issues.

I am deeply concerned about the fate of industries in Quebec that do not have enough leverage from the government to help them deal with today’s global issues, and that are also having to deal with the rising costs of transportation.

Most importantly, I am deeply concerned about the people who are struggling to make ends meet because the cost of gas and oil is cutting into their meagre incomes. I am talking about people in my riding—Sherbrooke—and people in all the regions of Quebec.

I would reiterate that the government has to establish a plan to counteract the negative effects of repeated increases in gas prices and reduce our dependence on oil.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I want to point out a couple of facts and then pose a question.

First of all, with respect to the oil and gas sector, people try to contrast it with the manufacturing sector and say that if one does well, the other does poorly. In fact, a great percentage of the projects that the oil sands is now causing is actually benefiting Ontario manufacturers, central Canadian manufacturers in particular. The fact is as the price of oil goes up, the activity goes up, as well as the demand for labour, but the manufacturing sector in Ontario certainly benefits.

We can certainly do something in a strategic sense to ensure that the energy is actually a strategic asset in Canada, which is what the manufacturing sector is asking for.

With respect to the Competition Act, the member should know that six people in Canada can actually launch a complaint with the Competition Bureau and it will be investigated. Our party's position is obviously those powers are in place currently. If people feel there is a concern at a retail or a wholesale level, they should put their names on a paper and write a letter to the Competition Bureau and instigate that investigation.

With respect to the oil sands regime that was put in place by the former government in 1995 and 1996, and I think it did a good job in doing so, the revenues that the federal government will recoup at the end of that time will actually be far greater than anything that was forgone in the short term period. That fact should be known.

With respect to the price of crude oil, does the member not acknowledge that Canada, despite its large reserves of crude oil, is in fact a price taker on the international stage? Being a price taker we can only influence the price of crude oil to a very minimal extent.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, I must give a number of answers to my colleague across the floor, because he asked a number of questions.

When looking closely at the price of oil, we note that several factors come into play, including the price of crude. More and more, we must be aware of the fact that, around the world, people are becoming owners of the oil sector. They have more and more power to intervene in the fluctuating price of a barrel of oil. Naturally, more and more external factors are being used to make it fluctuate.

Of course, we do not have the tools to do this on a global level. However, we have certain options here in relation to the Competition Act and, above all, with the monitoring agency.

The hon. member seems to forget the following, and he should observe this at home: on four street corners, imagine there are four different oil companies represented and, in one minute, the price goes up. The next day, at the same time, the price goes down. This means that there is no competition between the retailers, between the oil companies. Therefore, there is no competition in this area.

With an organization that can be as flexible as a monitoring agency, which can follow market developments daily, if not almost hourly, we can determine who is putting money in their pockets at the expense of consumers.

[Thierry St-Cyr, Bloc, Jeanne-Le Ber, QC]

Mr. Speaker, it is somewhat amazing and ironic to see the Conservative government fail to act on this issue; after all, this is the government which sings the praises of free markets at all cost. Recently, the minister of Industry was even heard refusing to provide assistance to the bicycle industry, arguing that competition always serves consumers best.

In that context, it is rather ironic that the government would not support a Bloc Québécois proposal to increase competition between oil companies. It is hardly surprising, mind you, when we hear the comments of the industry minister on gasoline prices. As we know, this minister once blamed high gasoline prices on the environmentalists. In my economics classes, however, I learned that reducing demand generally brings prices down.

Today, the Prime Minister told us that the Bloc Québécois was too keen on defending the interests of Quebec. It is true that the Bloc Québécois is the only party defending the interests of Quebec in this House.

I would like to ask my hon. colleague what alternative Quebeckers have, given that none of the federalist parties are defending their interests.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, the ultimate solution, which has never been tried or adopted, is really for Quebec to achieve sovereignty. As for the so-called defenders of Quebec on the government side, who come from Quebec, they are far from working for the interests of that province.

In every issue the Bloc Québécois gets involved in, developing programs to implement ways to improve efficiency, it always works for Canadians as well because, in most cases, what is good for Quebec is also good for Canada, and also for sovereignty in this instance.

[Maxime Bernier, Conservative, Minister of Industry]

Mr. Speaker, before I begin, I would like to inform you that I will share my allotted time with my colleague, the hon. member for Crowfoot.

I am pleased to have the opportunity to respond to the motion introduced by the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

This motion suggests a number of measures apparently devised to counteract the effects of recent fuel price increases on consumers.

The hon. members of this House know that very few of the issues that come up for debate are of such great interest or have such a clear and direct impact on the lives of Canadians.

Every one of us has personally grappled with this issue. We have seen and felt the fluctuation of fuel prices at the pump.

Every one of our ridings has felt the impact of the current situation in its own way. We know that businesses and agricultural producers are facing increased pressure on their costs because of the worldwide increase in the price of energy. In some cases, this pressure leads to very specific challenges.

Quebeckers who have no choice but to drive long distances to get to work and elsewhere are also acutely aware of the situation.

Any one of us can cite specific examples, and I think that this is what many of my colleagues are doing today, the people who have been addressing the House today. Because there are millions of examples like this all over Canada.

However, I would suggest that we must keep this truly important question in mind: what is the real situation in terms of energy prices, whether we are talking about gas, diesel fuel, oil, propane gas, natural gas or other sources of energy?

After all, we are talking about energy, and we all know that the recent fluctuation in energy prices is not a phenomenon that is exclusive to Canada. It has also been felt everywhere in the world.

I would like to answer the question by starting with the real situation. If we leave rhetoric aside, what can we say about energy prices? Just two words: supply and demand.

In other words, there is strong demand everywhere in the world for this product, which is marketed worldwide, and this is coupled, more than ever, with uncertain supply.

The significant energy price increases we have experienced here in Canada, and everywhere in the world, are dictated by international energy market conditions, which have had obvious consequences for Canadians.

The most obvious of those consequences, of course, was Hurricane Katrina in the United States, which left devastation in its wake. Apart from the human tragedy caused by the hurricane, it also caused considerable ravages to oil refining capacity in the Gulf of Mexico, and as we know, this led to energy shortages in North America and worldwide.

It is worth asking why and how prices go up. Global demand for energy and petroleum products has reached unparalleled heights at present. China and India are rapidly climbing the ranks of the global economic powers. This is good news for the world economy, because the result is an increase in their demand for energy.

Sources of oil worldwide are finding it increasingly difficult to meet demand, and this affects Canadians.

How does it affect Canadians? As we know, we are all affected when these prices go up. After all, is Canada not also energy self-sufficient? Canada is indeed a net exporter of oil. Canada is also affected by global oil prices.

While Canada does produce a lot of oil, as I have noted, it produces only a fraction of the world’s crude oil. For all practical purposes, then, Canada has no influence on the world price of crude oil.

So, when the American production infrastructure was hit by hurricane Katrina, American companies bought crude abroad to compensate and this raised the price everywhere, including here in Canada.

Let us talk a little about the Competition Bureau.

The price Canadians pay at the pump is the result of many factors, as we know. Price setting by market forces that influence supply and demand is very instructive for producers and consumers. Price increases indicate supply restrictions. They send a clear message to producers to produce more and to consumers to consume less. Regulating prices or setting other restrictions would cloud these indicators and thus lead to poor resource allocation, which ends up hurting all consumers.

This is why businesses are usually free to set their price based on what the market will bear. The Competition Bureau is concerned about high prices only when they are the result of anti-competitive activities contrary to the Competition Act.

As we know and as all of my colleagues know, since 1990, the Competition Bureau has conducted six major investigations of the gasoline industry. In each instance it found no evidence that the periodic increases in gasoline prices were the result of national collusion intended to limit competition in Canada. No, in each case, the Competition Bureau confirmed that supply and demand, that the free market in energy was working.

It is important to note that, taxes aside, gas prices in Canada still compare favourably with those in other industrialized countries.

The motion before us expressly demands that a surtax on oil company profits be created. However, I do not see how increasing these companies' operating costs by imposing a surtax would alleviate the rise in prices at the pump, because as I explained earlier, these prices depend on global supply and demand.

It is easy to cry out for a tax on profits, but we have to consider the actual situation people are in.

Suppose we have to drive long distances every day. Would imposing a tax on the oil companies reduce our travel expenses and the cost of gas? Would it mean a lower price per litre at the pump? Would it improve our vehicle's energy efficiency?

We can only conclude that a tax increase like the one proposed in this morning's motion will not produce results, especially the expected results.

We will hear people in this House call on the federal government to impose controls or regulate prices. Apart from the economic arguments, there is also a constitutional argument against this. By virtue of the property rights and civil rights enshrined in the Constitution, which come under provincial jurisdiction, the federal government has no authority to regulate prices. However, regulating prices would not solve the problem. Because of other economic factors, regulating prices will not reduce the price at the pump.

I repeat, regulating prices will not have any effect on prices at the pump.

I will conclude with a comment. A lot of ideas are being floated these days about how to relieve the pressure that the prices of gas, heating oil and energy in general put on Canadians. But we need to talk about what we can do, and we need to talk in full knowledge of the facts, keeping in mind the actual impact on Canadians and our economy. The answers do not lie in the motion put forward by my opposition colleague.

Private Members' Business--Bill C-292

[Rob Nicholson, Conservative, Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, on Wednesday, May 31 you indicated that there was some question in your mind as to whether Bill C-292 required a royal recommendation and indicated that you would welcome an intervention to this effect.

As I realize that today is one of the opposition parties' allotted days, I would be more than willing to support prolonging government orders to compensate for the time taken up with my intervention.

I would state at the outset that no government is more committed to improving the living conditions of aboriginal peoples. However, this bill raises important constitutional and procedural issues, which I will outline in my remarks.

Had the right hon. member for LaSalle—Émard introduced a private member's motion calling on the House to express its opinion on the Kelowna accord, we would have had no procedural objections and it would have been at significantly less cost to the taxpayer.

I also noted that the right hon. member, as a long-time parliamentarian, a former minister of finance and a former prime minister, would know the constitutional and procedural restrictions on financial legislation and the law-making process. Yet he has chosen to proceed by way of this bill.

I would like to make three points on this bill.

First, how can Parliament be asked to legislate on the basis of a document which has not been brought before it and which cannot be conclusively identified, particularly on an important issue which has major financial implications.

The bill refers to something “known as” the Kelowna accord. Therefore, what does the bill refer to? Is it a press release which announces commitments made by the previous government of “more than $5 billion” or other papers issued on that date?

I refer you, Mr. Speaker, to the Journals of November 28, 2005, the first sitting day following the conclusion of the Kelowna first ministers meeting. You will note that although the member for LaSalle—Émard was present in the House that day, no document was tabled with respect to the Kelowna meeting on November 25. On this day, the government, then led by the right hon. member, lost the confidence of the House on a vote of 171 to 133 and Parliament was dissolved the following day.

I would further note that the member for LaSalle—Émard knew that this vote was pending when he issued his press release on Kelowna on November 25.

I would ask you, Mr. Speaker, to consider whether the bill is procedurally acceptable in light of the fact that parliamentarians cannot be expected to vote on something which is clearly not before them and which is neither part of the record of Parliament nor included in the bill and which cannot be exclusively identified.

I would therefore ask you, Mr. Speaker, whether it is an imperfect bill and if so, I would invite you to strike it down immediately.

Second, if the member opposite alleges that the bill seeks to implement the commitments of “more than $5 billion” in the press release issued by the former prime minister, this would clearly require a royal recommendation.

Indeed the press release, which I will table before this House, was full of statements about the expenditure of money, including significant commitments beyond those authorized by Parliament for the 2005 budget and estimates. Clearly, if the bill requires the implementation of that announcement, the bill would impose a new expenditure.

While Bill C-292 does not refer to any specific dollar amounts, I would point to page 711 of Marleau and Montpetit, which indicates that there are two cases where such a bill requires a royal recommendation, namely: appropriation bills and bills which authorize new charges for purposes not anticipated in the estimates.

The previous government's main estimates and budget did not cover the spending in the November 25 press release and the main estimates tabled in the House on April 25 did not provide for the “more than $5 billion” announced on November 25. To implement the former prime minister's press release would oblige new expenditures not authorized by Parliament.

The press release issued yesterday by the member for Winnipeg South Centre stated that there was money set aside for the Kelowna accord. However, the former prime minister's November 25 press release recognized that the Kelowna accord included commitments beyond those authorized by Parliament for the 2005 budget. The fact remains that the new funding was not authorized by Parliament and, therefore, the bill requires a royal recommendation.

Hon. members across the way may argue that the funding to implement Kelowna was booked in the economic and fiscal update presented in November 2005. However, this cannot be the case, as the economic and fiscal update was presented on November 14, 2005, 11 days before the Kelowna meeting.

Although the previous government may have intended to request this funding from Parliament, this does not change the fact that it did not. Booking funds in a fiscal framework does not constitute parliamentary authorization for such expenditures.

I would emphasize that as Erskine May indicates, at page 763 of the 22nd edition:

If there is any doubt on the matter and it appears that the new proposal may entail an extension of previously enacted purposes of expenditure or an increase in the expenditure potentially liable to be incurred in pursuit of such [money], a money resolution will be required.

On the other hand, if the members opposite wish to argue that the bill does not require a royal recommendation, this would mean the bill carries no financial implications for the government, which brings me to my third and final point.

If by the “Kelowna accord” this bill refers to a document entitled, “First Ministers and National Aboriginal Leaders--Strengthening Relationships and Closing the Gap,” which I will table, I would note that this document contains no dollar amounts, not even signatures, and that the bill does not refer to this document specifically. If it is argued that this document contains no spending, then the logical extension of that argument is that the bill does not in fact require any financial expenditures and the government would not be under any statutory obligation to make the specific expenditures to implement the money identified in the former prime minister's press release. In fact, it could be argued that it is just another example of empty rhetoric.

If this bill were to pass, the custody of the consolidated revenue fund will move to the courts. To prevent that from happening, both the constitution and the Standing Orders require the Speaker to be vigilant in upholding the financial initiative of the Crown. I want members opposite to be clear on the government's position.

If you find, Mr. Speaker, that the bill does not require a royal recommendation, should Parliament adopt this bill, the government would be under no legal obligation to make any of the specific funding commitments made by the former prime minister's press release. Further, it could not oblige the government “to take all means necessary to implement the terms of the accord” in a manner that would require the expenditure of funds.

If this is the case, exactly what kind of bill would the House be considering? Would it not be a bill filled with empty promises? It would be a meaningless shell bill created for partisan purposes, which ignores the choices that Canadians made on January 23? Would it not result in a bad law and set a dangerous precedent where Parliament is asked to give statutory meaning to documents not before the House?

The government is acting to improve the lives of aboriginal peoples in the country, but with real money and not with meaningless bills. This matter goes to the heart of the principle of responsible government and the financial initiative of the crown and the legislative role of the House.

I am prepared to table those documents.

[Ralph Goodale, Liberal, Wascana, SK]

Mr. Speaker, this is an extraordinarily serious topic and I am glad the House has an opportunity to discuss it.

I must say that I am surprised by the intervention of the government House leader, first, because the government's argument today shows profound disrespect toward Canada's aboriginal peoples, and second, because it shows amazing disrespect for the office of the Speaker of this Parliament.

Mr. Speaker, you have already ruled on this issue many times, including barely one hour ago. The Speaker's ruling on that occasion earlier today and on many other occasions is quite clear. It reflects the view that is reported in Marleau and Montpetit at pages 711 and 712. Let me put those words on the record:

...since the rule change of 1994, private Members' bills involving the spending of public money have been allowed to be introduced and to proceed through the legislative process, on the assumption that a royal recommendation would be submitted by a Minister of the Crown before the bill was to be read a third time and passed. If a royal recommendation were not produced by the time the House was ready to decide on the motion for third reading of the bill, the Speaker would have to stop the proceedings and rule the bill out of order.

Assuming the argument that the government House leader is putting forward has some validity to it, which I do not accept but deny, it would seem to me, in the words of Marleau and Montpetit, that the normal process would be to allow the House to debate this matter in the ordinary course of events until it came to third reading. We would then see if by that time the government has brought forward the appropriate royal recommendations. If so, the matter can proceed to a conclusion but if not, that is the time when this item could be dealt with, but certainly not now and not in this way.

The government House leader's point, it seems to me, is not justified. The procedures of this House are not being infringed by Bill C-292 standing in the name of the right hon. member for LaSalle--Émard.

I want to make another point that relates to the rest of the argument advanced by the government House leader. Royal recommendations are required to accompany new proposals for new spending. The money required to implement the Kelowna accords is not new. Let me just take about two or three minutes to clarify these particular points.

As the federal minister of finance at the time of the Kelowna first ministers' meeting involving the then prime minister, provincial and territorial premiers and the leaders of five national aboriginal organizations, I can confirm that as of that meeting, specifically November 24, 2005, the fiscal framework of the Government of Canada included a total of $5.096 billion to address obligations arising from what became known as the Kelowna accord.

The Kelowna meeting was the culmination of more than 18 months of hard work led by the former prime minister, in collaboration with aboriginal organizations and all provincial and territorial governments, to put together a serious plan to bridge unacceptable socio-economic gaps between aboriginal and non-aboriginal Canadians. The resulting accords focused on issues related to health, education, housing and water, economic development and governance.

In the government's 2005 economic and fiscal update, which was issued on November 14, the importance of the then upcoming Kelowna meeting was specifically mentioned, together with an undertaking to provide the needed funding. I would point out, with respect to the fiscal update, that there was more than enough unused fiscal room in the framework at that time to accommodate the expected sum. When the Kelowna meeting actually took place about 10 days later, the money was booked in the amount of $5.096 billion.

It is interesting that the fiscal treatment of the Kelowna accords was quite similar to how we handled another important issue at that time which was the special federal funding of $755 million to help the grain and oilseed producers in the farm sector. In both cases, formal announcements were not ready to be made at the time of the November 14 fiscal update but both were signalled specifically in that update and flexibility was built into our framework to cover the anticipated expenses.

By November 24, both initiatives were ready to go, both announcements were made and the money for both was booked.

I am very pleased that the government has proceeded with our $755 million commitment to help farmers. That is the right thing to do. In that same spirit, it is also important for the government to follow through on the parallel commitment to aboriginal peoples and deliver the funding that was most certainly set aside for this compelling purpose on November 24 of last year.

It is interesting to note that at Kelowna the now Minister of Indian Affairs was personally present in the room and applauded the result that was arrived at by the discussions in Kelowna. It seems to me terribly unfortunate that the government continues to devote extraordinary time, effort and energy to denigrating the efforts of previous governments and previous parliaments.

Since all of that there has been an election, a Speech from the Throne, a surplus of $12 billion and a budget. It seems to me that it is time for the government to quit blaming the past and to start governing for the future for a change.

[The Speaker, Liberal, Peter Milliken]

The Chair thanks the hon. government House leader for taking this matter up before the House and the hon. member for Wascana for his comments in assisting the Chair on the matter. I will take the matter under advisement and return to the House with a decision in due course.

I note that if the decision is one that relates to the requirement for a royal recommendation, the Chair may make a decision about that at any time prior to the third reading of the bill, so there is obviously a matter of months.

The concern I have in making a decision on the other points raised by the government House leader as to what the bill means is whether I can produce a decision on that matter, given the research I think will be necessary to examine the documents he has tabled and the bill, before tomorrow at 1:30 p.m. when I believe the debate begins on this particular item. The worst that could happen is we would have one hour of debate on it and then if there were a problem it would become apparent before the second hour of debate, which will not happen for some time.

If that ends up being the case, I hope hon. members will be understanding of the Chair's inability to render a decision forthwith on this subject.

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Hull—Aylmer, the federal public service; the hon. member for Thunder Bay—Rainy River, border security.

The House resumed consideration of the motion.

Opposition Motion—Gasoline Prices

[The Speaker, Liberal, Peter Milliken]

Before the point of order, the Minister of Industry had the floor and finished his speech; however, there are five minutes remaining for questions and comments.

The hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, after this I would like to return to the debate as such. The minister recognized the importance of the issue and that it affects Canada as a whole. We share this point of view. However, we do not agree with the minister when he states at the same time that it is a North American market. He stated that Canada produces more oil than it consumes and exports it.

The problem is not with the world price. We know how things work at that level. Perhaps something can be done by the G-7. We take issue with the fact that the federal government is not shouldering its responsibilities under the Competition Act and in terms of monitoring the economy in general. It should go and find out specifically how refining margins are realized.

There has been something happening in the oil industry that has led to a very significant decrease in the number of refineries in North America. People talk about hurricane Katrina, but that is only a manifestation of the problem. There is a problem as a result of hurricane Katrina, but the organization of North American refineries has made any substitution impossible. The market is organized that way because petroleum is a very unique product. We cannot compare it to any other product in competition. No one can run their car on firewood. It takes gasoline to run a car.

Why does the federal government not follow through on our suggestion to create a petroleum monitoring agency and give more teeth to the Competition Act? This last item was requested by the last two competition commissioners. That way, we could get to the bottom of this. We will not resolve the problem by avoiding it. We have to face it.

As far as the tax is concerned, we are being asked whether this could help. If the money generated by this tax could be used to help us diversify the energy sources we have already and move toward renewable sources that are more environmentally friendly, this would be a big step forward.

From 2002 to 2005, the five Canadian oil companies made $27 billion in profits through taxpayer funded investment programs by claiming accelerated depreciation. Our constituents are paying the price. And it is not just individuals who are suffering, manufacturing companies are too. We hear the minister from Quebec say he cannot do anything about it.

When will the minister decide to take his responsibilities and get to the bottom of this issue of refinery margins so that our constituents can finally stop paying 10¢ more than they should for gasoline?