Mr. Speaker, I feel very bitter as I rise to participate in this debate.
Everything we see today, the whole mess, is the fault of the Liberals and Conservatives. Things could have turned out very differently if Canada—as it behaves at the WTO and in all the international trade forums—had not acted like a peewee, if not an atom, in the negotiations, starting with theMinister of Industry and his far-fetched statements last spring that opened the way to this cut-rate agreement.
I rise as well to be very responsible. When the agreement with the Americans was signed, we went around to the industries, unions and communities in Quebec. They told us, contrary to what the parliamentary secretary claimed, that the agreement was not perfect and needed to be clarified, but they were exhausted. They said that the Conservative government had smothered them and they were on the verge of bankruptcy. They asked us, therefore, to vote in favour of the bill based on this agreement but to go on saying that the agreement was cut-rate and far from the original objective. That objective, back in 2001, was for free trade in the softwood lumber industry.
This responsible approach led us to go and listen to what the industry, the unions and the communities had to say. This approach also means that the Bloc Québécois will vote in favour of Bill C-24.
I rise today not only to be responsible but also to be constructive. Everyone said throughout Quebec that this agreement was not enough to resolve the structural crisis that the forest industry is going through, especially in Quebec. It is probably the same everywhere in Canada, and the parliamentary secretary must have heard about it. We will need much stronger action to help the softwood lumber industry and our workers to survive this crisis.
If the Conservative government just sits on this bad agreement, thinking that people will forget the rest, it is sadly mistaken. I reach out to the Conservatives so that they proceed with the post-agreement phase and institute a real plan in support of the forest industry. It is true of Quebec, and I am sure it is true of Ontario, Alberta and British Columbia. If the Conservatives are happy just to pass Bill C-24 and think that that solves the problem, they will pay a heavy price in the next elections, which, I can assure the House, will not be long in coming. Our responsible, constructive approach should not lead the House to forget that we have not achieved the objectives that Parliament set for itself in 2001.
I myself introduced a motion, which passed unanimously, asking the Canadian government to do all it could to ensure that the softwood lumber industry was finally included in free trade. Unfortunately, as I said, the attitude, policies, approaches and directions of the previous government and the one that followed have led to this dead end. The industry needs a little oxygen.
Remember that Guy Chevrette said the industry needs some breathing room. He also said that if there were loan guarantees, he would refer the issue to his association for a vote, and that he thought people would be ready to fight to the end. The Conservative and Liberal governments refused to help the industry. They forced it to its knees and then suggested it accept the agreement, without which it would surely face ruin.
We refuse to let it be ruined. Saving it from ruin means more than just adopting Bill C-24; it also means instituting a whole series of measures to help the industry survive the structural crisis that, in Quebec, resulted from the Coulombe report, as the parliamentary secretary should know. Cut volumes will gradually be reduced by 20%. Energy costs have risen, the dollar has reached great heights, and there are a number of other problems Quebec alone faces. I will come back to this later.
I would like to review the order of events briefly. On March 31, 2001, the previous agreement fell. It, too, was a trade agreement administered with the United States. At the time, companies belonging to the American protectionist coalition submitted a petition. The Department of Commerce responded by imposing a 28% duty.
What was the Liberal government's strategy? That is the root of the problem. That government adopted a two-pronged strategy: negotiation with the Americans and legal proceedings.
Once the Canadian government sat down at the negotiation table, the Americans—both the American authorities and the protectionist coalition—expected to reach an agreement like the one before us now, which led to Bill C-24. The responsible thing to do would have been for the minister in charge at the time, Mr. Pettigrew, to say that we intended to pursue all legal avenues to resolve the issue once and for all. Indeed, sooner or later, we will have to find out who is in the right: the Americans, or Canadians and Quebeckers.
As you know, all of the courts, both the WTO and NAFTA, ruled in our favour. Our lumber is not subsidized and is not harming American producers. As such, the duties are illegal. However, we did not pursue this course to its end.
And a few months later, as I mentioned, the industry itself asked us to vote in favour of Bill C-24. Why? Because the Liberals not only pursued both paths, which sent a bad message to American authorities and the American industry, suggesting that we were going to bend sooner or later, but the government also refused to implement an aid program for the industry, although the Bloc Québécois has been requesting this since May 2002. I proposed this plan along with my colleague, the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup. I would remind the House that if we had achieved those elements, our situation would be different today. But, no, the Liberal government refused, just like the Conservative government.
First, to allow businesses to avoid bankruptcy, we demanded an aid program with loan guarantees on the basis that illegal duties levied by the Americans constituted accounts receivable. We were told that that was impossible, that international trade legislation did not allow for loan guarantees. Two weeks before the election, the Liberals, sensing they were in hot water, agreed to offer $800 million in loan guarantees for the next five years.
Even worse than that, in the agreement and in the legislation, the federal government is going to operate precisely through loan guarantees. It will buy back the illegal duties levied by the Americans because they are accounts receivable. We could have been doing this since 2002.
Second, we also asked for a relaxation of employment insurance requirements. We are still asking for this and still have not obtained it, not from the Liberal nor the Conservative government. Third, we also asked for support for processing activities in order to offer more job opportunities in Quebec forestry. We never obtained that support. True, the Liberals established a program to diversify economic activity in those areas suffering from the softwood crisis. However, not one business affected by this crisis received a single cent in aid from the government, apart from $20 million for legal fees, if memory serves. This was, moreover, the fourth point in our action plan, namely, that Ottawa would pay the legal fees of any businesses that fell victim to American legal aggression. At that time, legal fees totaled $350 million. As we know, that figure is now much higher.
So if this plan had been put in place, on the basis of our legal victories—we were not far from the end—we could have got through the legal proceedings. When all options had been explored, there would have been a legal victory. It is clear that a legal victory, and the Minister of Industry said so to us—and he is right on this—does not guarantee that the Americans were going to act on these legal victories. Still, they would have put us in a much better negotiating situation than what happened to us when, in early April or late March, theMinister of Industry went and said that, actually, we did not expect to receive all the duties collected illegally by the Americans. What a great message! That creates some negotiating power!
I have been a negotiator for a long time. When we say to our opponent, to the party across the table, that we know that ultimately we will not get everything we are asking for, even though it is our own money, there is a problem. Obviously, the Americans leapt at the agreement and, oddly, a few weeks later, on April 27, we had an agreement that was slightly improved—it must be admitted—on July 1, and that led us to Bill C-24.
As I said, if the Conservatives had continued on the path I have indicated, that is, right to the bottom of the legal issue, with an assistance plan for the industry, we might have been talking about a few months. We would have been able now to have negotiations with the Americans that would have enabled us eventually to go back to free trade. Unfortunately the agreement may be terminated in three, seven or nine years. We do not know. Let us hope that it will last as long as possible. I am not one of those who wish the worst for our industry, on the contrary. I want what is best so that we can have stable and flourishing communities, businesses and jobs.
As I mentioned, when it ends in three, seven or nine years, we will have to do it all over again. Do you think that the American coalition will stand around idly with this $500 million we have just given it? No, certainly not, it is going to start building its case. We can be sure that in maybe three, seven or nine years a fifth dispute concerning lumber will start again.
What are we going to do then? Is it better to give in immediately and say that we Canadians—not Quebeckers—are prepared to accept everything the American coalition wants, because we are not prepared to fight to the finish?
We have some lessons to learn from this episode, and the first one is never to open negotiations before exploring all the legal options. But the only way to explore all the legal options in this issue is to provide solid support for our lumber industry.
Unfortunately, in three, seven or nine years, I will no longer be here since Quebec will be a sovereign country. However, I want to leave Canada's parliamentarians with a constructive lesson that I am taking from this softwood lumber saga; during negotiations, never extend the hand of friendship to the American authorities and softwood lumber industry until the legal process is over. From day one there has to be an assistance plan with teeth, as the member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup and I suggested in 2002.
I was saying that we had a responsible attitude in this case, that we toured the regions and the industries. The leader of the Bloc Québécois and I phoned big businesses, talked with people from the associations, presidents of the major unions, and representatives of the municipalities affected by this crisis. As I was saying, no one spoke publicly to encourage the Bloc Québécois to vote against the bill resulting from the agreement—the future legislation—or to say they were out of money, out of breath and in the process of suffocating.
Although the agreement is far from perfect, it is in this context that the Bloc Québécois will vote in favour of Bill C-24. As I said, the crisis is huge. In Quebec there have been 7,000 layoffs since 2005. In my riding, there were 400 layoffs just a few weeks ago. Louisiana-Pacific closed its sawmill and waferboard plant. In my opinion, there is not one region in Quebec where this industry operates that is not suffering right now or worrying. The Louisiana-Pacific closure is indefinite. Let us hope it reopens as soon as possible. But for that to happen there needs to be an assistance plan.
The FTQ and the CSN have issued press releases. We know that Mr. Chevrette also issued a press release immediately after the Bloc Québécois decision to support the bill resulting from the agreement, saying that the Bloc met the industry's expectations.
Nonetheless, I will read some excerpts from the FTQ and CSN press releases to show to what extent the Bloc Québécois is in tune with the stakeholders in Quebec, by taking concrete action on the ground. If the Conservatives want to do the same, they will need to use more than words. They need to take action. I will close later with what we propose they do to get through this structural crisis.
I will read the FTQ press release:
The Fédération des travailleurs et travailleuses du Québec (FTQ) salutes the Bloc Québécois decision, announced yesterday, to support the softwood lumber agreement.
Given the catastrophic situation of the forestry industry, the FTQ believes that this agreement, although far from perfect, represents the only possible outcome that will save the industry. “This agreement will now force the Conservatives to take concrete action to help the industry survive the major crisis that it has been living through for several years,” stated Henri Massé.
For many years, the FTQ has been calling for concrete measures to help the forestry industry and workers, as well as an assistance program for older workers.
“It is vital that the government listen carefully to the Bloc Québécois demands regarding assistance for the industry and for the workers,” Henri Massé pointed out.
This is the FTQ press release. As we can see, that is not the end of the matter. Once Bill C-24 is passed, I hope that the Conservatives will not sit on their laurels. There is work to be done and we will suggest avenues to be pursued.
I would now like to quote from the Confédération des syndicats nationaux press release:
The CSN gives its support to the demands of the Bloc Québécois, announced yesterday, which seek to support the workers, companies and communities that have been hit hard by the softwood lumber dispute.
The CSN press release goes on:
Referring to the dramatic situation many communities in Quebec are in because of massive job losses in recent months, CSN president Claudette Charbonneau said that the federal government must act quickly to put in place a structured assistance plan. “Older workers and companies in difficulty must have financial support. The hemorrhaging has to stop”, she said.
The release continues:
The CSN stated that the softwood lumber deal is far from perfect.
So two out of two. That seems fairly clear. The release goes on:
However, it is unrealistic to hope to re-open the agreement with a view to improving it in time to help workers.
A quote from the CSN president follows:
The federal government, which negotiated this bad deal, has a responsibility to make up for these deficiencies using effective support measures that will give new life to an industry that is on its last legs. The survival of whole communities in many parts of Quebec is at stake.
The CSN adds:
The federal government should have taken steps long ago to help the workers and companies. Now, it has a golden opportunity to demonstrate its good faith.
As hon. members can see, support for the deal is far more qualified than the Conservatives let on. As well, I have a hard time understanding how the Liberals from Quebec can oppose Bill C-24, which has arisen out of the agreement, just when the players themselves, while stating as we have that the deal is not perfect, are acknowledging that it exists and was negotiated with the Americans.
Given the series of mistakes that have been made since 2001 by the Liberal and Conservative governments, it is hard to go back. Back to the Future is a movie; it is not reality. We have to recognize this.
I will conclude by talking about the support measures that we have proposed to the Conservative government and that are mentioned in the CSN and FTQ press releases: first, an income support program for older workers.
We discussed it during question period. We want a program like the one that was abolished by the Liberals in 1998: a plan for workers 55 years of age or more all over Quebec in sectors hit by mass layoffs. We will not agree to an income support program for older workers aimed at a particular sector or region to the exclusion of others. There is a group of workers who need help making the transition from their lost job to their pension. We need this program back, which as I said, used to exist until 1998.
Insofar as communities as concerned, we suggest real economic diversification programs for communities dependent on forestry. I will mention them. The Liberals established one, but it did not help the industry, it just helped communities. We need not only that program back now but also programs for businesses. For businesses, we want the $4.4 billion in countervailing and antidumping duties that will be paid back by the American authorities to be subject to a tax treatment that will take into account the damages suffered by these companies.
Indeed the dollars in which the companies paid these duties three or four years ago are not worth the same nowadays. Companies will therefore be paid back in Canadian dollars that are worth much more. They will therefore get less back in Canadian dollars than they paid three or four years ago. The government should take this into account. According to the companies’ assessments, they will lose between $400 and $500 million because of the changes in the exchange rate.
Since the tax formula that the government is going to adopt takes changes in interest rates into account, we expect that changes in the exchange rate will also be taken into account. We have a request from the Canadian Manufacturers and Exporters that could be applied to the forest industry on an experimental basis, namely accelerated depreciation on machinery. Obviously, if the depreciation can be deducted faster, the taxes on earned income are reduced.
We also recommend setting up a program to stimulate innovation in the forest industry and improve its productivity, programs to diversify lumber markets, and financial compensation for maintaining the road network. Our last suggestion relates to the tax credit for research and development. In the case of the forest industry, this is not worth much because the industry does not pay much tax—in fact, it does not pay any. I have been told that several companies have accumulated enough tax credits for the next 10 or 20 years. We therefore ask that this tax credit be refundable—on a trial basis, no doubt—to the forest industry.
For example, Tembec invests $80 million a year in research and development, but cannot benefit from tax credits for these expenses. Refunding the tax credit could stimulate research and development in a sector that really needs it.
I would like to end by saying that the Canada-U.S. agreement provides for a bilateral committee to administer it. The industry has identified a number of problems. We hope the bilateral committee will be able to correct these problems. I would like to see the creation of a sub-committee of Canadian, Quebec and American elected officials to work alongside the bilateral committee.
In conclusion, one of the problems we are facing is complete insensitivity on the part of American elected officials to the realities of the forest industry in Canada and Quebec. They are under the thumb—let us be frank—of an industry lobby that buys elections and probably even buys some elected officials. It might be time to correct this situation by having more frequent and regular contact with them.