House of Commons Hansard #131 of the 39th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was companies.


Income Tax Amendments Act, 2006Government Orders

5:20 p.m.


Pat Martin NDP Winnipeg Centre, MB

Mr. Speaker, I thank my colleague from Burnaby—Douglas for pointing out a perfect graphic illustration or example of the point I was making of how our tax system is really stacked against the ordinary person with these advantages that some of us have not even realized.

We owe a debt of gratitude to our colleague from Hamilton Mountain for pointing this out. All the salaries in a business are tax deductible, including the $2 million, $3 million, $5 million or $8 million compensation packages for CEOs in some of these big corporations.

This means that we are underwriting or subsidizing with a tax deduction this outrageous CEO salary issue. I think it is an excellent illustration. It is poignant the way my colleague from Hamilton Mountain pointed out that by 10 o'clock I believe on January 1 some of these CEOs have already made more than the average income.

The Canadian Taxpayers Federation used to have tax freedom day around June 11. It used to have a corporate tax freedom day, but it kept getting in the way of the New Year's Eve celebrations, so it had to cancel it. These corporations were already at an advantage before they had taken their bells and whistles off for New Year's Eve.

The other thing is that stock options should be expensed on the financial statements of the companies where we invest. Some of these white collar corporate governance issues are actually blue collar issues. Many of us in the trade union movement have our pensions invested far and wide in corporate Canada in the financial sector. We need to know because some of these stock options do not show up and only the CEO's salary shows up. The CEO might be sitting on stock options which are greater than the total net worth of the company.

We should have a right to know those investments. We have to be able to trust the financial statements of the companies where our pension plans are investing.

Income Tax Amendments Act, 2006Government Orders

5:20 p.m.


John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I must admit that the last comment by the hon. member is close to the dumbest thing I have heard in this Chamber ever. Not being able to deduct salaries against income makes absolutely no sense. I have heard some pretty loony ideas from that far corner but that is close to the best so far.

I just have a few minutes left and I want to talk about this issue of tax fairness. Bill C-33 is about closing some loopholes and issues with respect to offshore entities. There is not much question that it will enjoy great support in the House. It is a worthwhile bill and it needs to be supported.

However, I want to caution Canadians that whenever the finance minister starts talking about tax fairness they should probably start heading for the hills, especially if he is saying that during an election or during a budget speech.

The folks from the income trust debacle have learned, to their great chagrin, to never trust a Conservative during an election. After specifically and repeatedly saying that they would not tax trusts, they shocked Canadians by imposing a Draconian tax on trusts destroying over $25 billion in hard-working Canadians' savings and values.

People are so staggered that they have actually taken to putting ads in the national newspapers. Mr. Speaker, I need your help here because all of the ads refer to Stephen Harper and I do not want to say that in the House. I know that you will get upset if I say Stephen Harper, so I want you to correct me and say Prime Minister.

Income Tax Amendments Act, 2006Government Orders

5:25 p.m.


The Acting Speaker Conservative Andrew Scheer

I will warn the hon. member. He just said it twice and I will not be correcting him every time he makes a mistake. I urge him to read ahead of what he is going to be quoting from and ensure that he does not make that mistake.

Income Tax Amendments Act, 2006Government Orders

5:25 p.m.


John McKay Liberal Scarborough—Guildwood, ON

Mr. Speaker, I need your help because that is the way the ad is written. However, I will use his title, the Prime Minister.

The add reads, “[The Prime Minister]'s word is worthless. Just ask 2.5 million Canadian who own income trusts. [The Prime Minister] garnered votes in the last election by promising not to tax income trusts. He promptly reneged on that promise and the process wiped out $35 billion in Canadians' life savings. He then refused to disclose his analysis behind this policy reversal. If [the Prime Minister] wants a majority, then it's time he started listening to the majority”.

Here are the results of an Angus Reid poll. What part of this poll does the Prime Minister or indeed the Minister of the Environment not understand?

“Was it right for the Prime Minister to break his promise?”

In view of the information provided by the government to date on the tax effect of income trusts, and given the material loss of retirement savings by income trust investors, do you personally believe it was right or wrong for [the] Prime break his election promise concerning income trusts?

The Angus Reid poll showed that 70% of people said that it was wrong, which is way beyond the magic 40% that the Prime Minister is looking for. The poll asked: “Is the Prime Minister a leader or is he a misleader?”

The ad goes on to state, “Just ask the premiers of Saskatchewan, Nova Scotia, Newfoundland and Labrador”.

There is a saying in the House that if there is still discussion about the budget 48 hours after it is presented, it is a bad budget. Here we are, 10 days after the budget, and the government has irritated beyond belief the premier of Newfoundland and Labrador to the extent that he takes out national ads. He has a lawsuit from the premier of Nova Scotia. The folks from the income trusts have taken out an ad. The premier of Saskatchewan is also upset.

The Prime Minister promised not to include oil and gas revenues in the equalization formula. It turns out his word is worthless. The constituents in Scarborough—Guildwood actually write and tell me this. I think the Minister of the Envrionment would be interested in knowing what they said. In fact, I will share with him my e-mails any time he wishes to see them. It appears Canada has a budget deficit. It is a deficit in integrity.

The premier of Nova Scotia, Rod MacDonald, had this to say, “Very disappointed. It's an agreement that we signed, an agreement that we expected our federal government to uphold”.

The premier of Newfoundland and Labrador, Danny Williams, had this to say, “What they've done today is basically completely shafted us”. He said that Newfoundland was very disappointed at being betrayed.

It is really quite extraordinary that on the same day the premier of Newfoundland takes out a full page ad in national newspapers and quotes a Conservative pamphlet distributed during the election. The pamphlet states:

There is no greater fraud than a promise not kept.

No small print. No excuses. No caps.

On March 19, 2007, in his second budget, the right hon. Prime Minister broke that promise. It was a promise that he made in a pamphlet. He stood on two election platforms and said it to our faces. I see the Minister of the Environment is going crazy because he realizes that everything that the premier of Newfoundland says is true. He wrote in letters over and over again that it was a simple, unequivocal promise and he broke it.

The Minister of the Environment understands that completely, which leaves us--

Income Tax Amendments Act, 2006Government Orders

5:25 p.m.

An hon. member

Because he is part of the problem.

Income Tax Amendments Act, 2006Government Orders

5:25 p.m.


John McKay Liberal Scarborough—Guildwood, ON

Indeed, he is part of the problem.

It leaves us with a simple and unequivocal question: What does that leave us, not just the people of Newfoundland and Labrador, but us, we the people of Canada? If we cannot accept at face value the promise of thePrime Minister, then who can?

Can the people of the Atlantic provinces or Saskatchewan or, yes, even the people of British Columbia and Alberta accept his promise, because all have had promises made to them of one sort or another? All of them should be now asking what those promises are worth. A promise made should be a promise kept and, as the Prime Minister pointed out, there is no greater fraud than a promise not kept.

Then our Prime Minister will not keep a promise as simple as the one he made to us. It is not just the people of Newfoundland and Labrador who lose. We all lose.

When we are talking about tax fairness, Canadians should beware when the government talks tax fairness. If two ads in the national newspapers are not enough, then the premier of Saskatchewan piles on with his outrage. What we have is a Prime Minister so bent on his partisan agenda that he is willing to throw out a promise he made to Premier Lorne Calvert and the people of Saskatchewan and, by the way, other Canadians.

A message was delivered by the Usher of the Black Rod as follows:

Mr. Speaker, it is the desire of Her Excellency the Governor General that all hon. members attend her immediately in the Senate chamber.

Accordingly the Speaker with the House went up to the Senate chamber.

And being returned:

5:45 p.m.


The Speaker Liberal Peter Milliken

I have the honour to inform the House that when the House went up to the Senate chamber, Her Excellency the Governor General was pleased to give, in Her Majesty's name, royal assent to the following bills:

Bill C-49, An Act for granting to Her Majesty certain sums of money for the federal public administration for the financial year ending March 31, 2007—Chapter 3

Bill C-50, An Act for granting to Her Majesty certain sums of money for the federal public administration for the financial year ending March 31, 2008—Chapter 4

Bill S-3, An Act to amend the National Defence Act, the Criminal Code, the Sex Offender Information Registration Act and the Criminal Records Act—Chapter 5

Bill C-37, An Act to amend the law governing financial institutions and to provide for related and consequential matters—Chapter 6

Bill S-2, An Act to amend the Hazardous Materials Information Review Act—Chapter 7

It being 5:45 p.m. the House will now proceed to the consideration of private members' business as listed on today's order paper.

The House resumed from February 8 consideration of the motion.

Textile IndustryRoyal Assent

5:45 p.m.


Steven Blaney Conservative Lévis—Bellechasse, QC

Mr. Speaker, I would like to thank you and my colleagues for giving me the opportunity to participate in the debate on Motion M-158 concerning the textile and apparel industries.

Before discussing the merits of this motion, I think this is a good time to remind the members of what our new government has done and what it is still doing to help these two industries compete in an ever more demanding global market.

Among our government's many initiatives worth mentioning, I would like to highlight the in-depth review of several proposals concerning an outward processing program to open new markets for the textile and apparel industries; measures to meet the changing needs of workers in these changing industries through the employment insurance program; and efforts to determine and reduce customs tariffs on textile inputs to improve cost competitiveness.

The 2007 budget offered even more support to the textile and apparel sectors. It contains a measure encouraging investment in manufacturing and processing equipment between now and 2009 by applying a 50% straight line write-off for two years. It also increases the capital allowance rate on buildings used for manufacturing and processing from 4% to 10%.

Canada's new government is providing tangible proof of its commitment to helping these industries by taking steps to reduce or eliminate customs tariffs on certain textiles used in the apparel industry. In addition to enabling apparel manufacturers to save nearly $4.5 million per year in customs costs, these measures will help companies maintain jobs for Canadians by making those companies more productive and competitive. This announcement was very well received by industry representatives. Elliot Lifson, president of the Canadian Apparel Federation, was very happy with this measure, which is a step in the right direction. He said that the industry has been asking for this for a long time.

Our new government has also demonstrated its continuing support of the Canadian Apparel and Textile Industries Program, or CATIP. That program provides financial support for the textile and apparel industries to help them become more competitive. Working in partnership with industry associations and other stakeholder organizations, CATIP assists Canadian textile and apparel firms to adjust to impacts of globalization through numerous approaches including: industry-wide branding initiatives; support for domestic and international marketing activities such as trade shows, match-making events and marketing materials; support for best practices and diagnostic sessions for companies; development of national textiles and apparel portals and e-commerce awareness activities; and, staging of domestic industry conferences. These are examples of initiatives that receive financial support from our government to help manufacturing industries position themselves on the global market.

Another unique component of this program, the textile production efficiency component, more commonly called CANtex, helps companies enhance their productivity and reorient production toward other value-added products for growth markets.

The measures I have just outlined clearly demonstrate that Canada's new government has been and continues to be determined to help these two important industries address the challenges of a global market, which, as we know, is increasingly competitive. But if the textile and apparel industries are going to meet the challenges that extend well beyond their own industry, our government, for its part, must also create an economic climate that encourages business to invest and expand. To help Canadian companies withstand competition and succeed on international markets, we need a specific, long-term economic plan.

That is why Canada's new government has created Advantage Canada, an ambitious plan based on the principles set out in the 2006 budget, a plan that looks to the future and that is designed to make this country a world leader, now and for future generations.

It is these commitments, and the other measures announced in that plan, that will enable the Canadian textile and apparel industries, and other businesses in Canada, to adapt to rapid changes in the world economy.

Advantage Canada will have a real impact on companies that invest in equipment, innovation and training. One of the fundamental principles of this plan is our government's firm belief that business must be free to grow and succeed. We realize that companies do not necessarily need the government to be directly involved in how they manage their business, and that rather what is needed is for government to act judiciously to guide the economy. They need the government to create a favourable climate that will enable them to excel at what they do best: investing, growing and creating jobs.

One element of the Advantage Canada plan is the reduction of income tax on investments by businesses, an essential measure to ensure our long-term prosperity. Canada wishes to maintain an advantage respecting the taxation of businesses, in order to encourage them to invest here rather than elsewhere. The tax relief plan for businesses introduced in the 2006 budget enables Canada to maintain a competitive advantage over the United States concerning the statutory tax rate for income from manufacturing, while increasing Canada’s advantage respecting the general tax rate. We have also enhanced Canada’s tax advantage by committing ourselves to establishing the general tax rate for businesses at 18.5% in 2011.

Many other measures designed to improve Canada’s fiscal competitiveness have been adopted under Advantage Canada, such as establishing the lowest tax rate on new business investment in the G-7 countries and envisaging the possibility of reducing tax distortions that work to the advantage or disadvantage of certain business sectors or structures.

Our plan is designed to eliminate repetitive and costly administrative procedures that prevent businesses from investing and innovating. Though it is important and necessary to maintain a certain level of regulation when justified by circumstances, we should take energetic measures to eliminate unnecessary regulations that put our country at a competitive disadvantage. As indicated in a study completed by the OECD in 2001, small businesses, the SMEs like those in Lévis—Bellechasse, or businesses found in the automobile sector in the riding of Chatham—Kent Essex, of my colleague here, are penalized the most by the administrative burden. Our new government has already lightened this burden and will lighten it more by adopting a versatile approach that includes the following measures: working with the Canadian Federation of Independent Business in order to reduce businesses’ administrative burden by 20%; developing a modern approach to intelligent regulation based on results rather than processes; and targeting the important sectors for small businesses, such as the expansion and implementation of appropriate programs.

Generally speaking, we will take steps to help Canadian businesses deal with the challenges of global competition by giving them every opportunity to succeed. Businesses that invest in Canada bring with them expertise and innovation, while foreign trade and investment provide our Canadian businesses with the expertise they need and increase their ability to take advantage of investments and innovation. Opening ourselves up to trade and investment creates opportunities here, and that is why we wish to create a favourable climate.

We want to work with business and Advantage Canada has thus provided these four key elements that are going to support the manufacturing industry: tax reduction; a fiscal advantage, notably by eliminating the debt and thus reducing the Canadian tax burden; a knowledge advantage, in order to have educated, skilled and efficient workers, and an infrastructure advantage, through record, historic investments of $32 billion over seven years to guarantee the free circulation of goods and services.

It is not surprising that the reaction to Advantage Canada has been positive and I will be pleased to talk further about the support our government is giving to manufacturing businesses and the Canadian textile sector.

Textile IndustryRoyal Assent

5:55 p.m.


Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC

Mr. Speaker, I am very honoured to rise here today to speak to Motion M-158, which reads:

That, in the opinion of the House, the government should act on the motion proposing to help the textile and clothing industries adopted in the House on October 5, 2005, and worded as follows: “That, in the opinion of the 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 allowing clothing made with Canadian textiles but manufactured abroad to be imported without customs duties and by creating an income support program for older workers”.

It would be easy enough for the government to implement this motion. It would help to preserve the few jobs that remain in Canada in the textile and clothing sectors.

For years, my Liberal colleagues and I have been exerting pressure to obtain support and to force the government to move this file forward. The Bloc decided to join our fight, but as a party that will never be in power, it can hardly make things happen.

Furthermore, much of the progress achieved in this file comes as a result of the hard work of my former colleague, the former member for Ahuntsic, the hon. Eleni Bakopanos. I would also like to commend the work undertaken in this file by the Liberal Party's new labour critic, the hon. member for Davenport.

Personally, as the member of Parliament for Saint-Léonard—Saint-Michel, a riding where many clothing and textile factories once did business—which, sadly, is no longer the case, I often had the opportunity to meet and speak with people who owned and worked in those businesses and to learn more about the challenges and obstacles facing their industry.

As my hon. colleagues know, the Canadian textile and clothing sector still represents a major source of economic activity and revenue in Canada. Located primarily in large urban centres such as Montreal, Toronto, Winnipeg and Vancouver, textile companies employ many Canadians of all ages.

Canada's apparel and textile industries began to adapt as soon as they were faced with increasing competition from abroad. From my discussions with various stakeholders, I know that the industry is ready and has been working on ways to confront the new challenges as it faces the move from conducting business with local or domestic clients and markets to competing against huge international players with vast financial resources.

With the continued development of the world, and in particular the rise of third world nations, these industries are being forced to transact in a global economy. Consequently, the Canadian apparel and textile industries have had to transform themselves over the past decade by focusing on higher value added products, on innovative ways to work, on producing attractive new goods, and by identifying and winning niche markets for their products.

However, further change continues to be the order of the day. As I have mentioned, many domestic producers in all industries are faced with strong competition and obstacles internationally, but Canadian manufacturers also have particular problems that other global players do not necessarily have to deal with.

For starters, in the last few years we have seen the appreciation of the Canadian dollar versus the American dollar, which has added to the price of goods manufactured in Canada compared to goods coming from other parts of the world.

Second, the wage disparity between a country like Canada, with its higher standard of living, versus third world countries where wages are a fraction of the cost is also a factor in Canadian goods being more expensive.

Third, the Canadian industry has also had to deal with the dumping of goods by foreign competitors into worldwide markets that are less regulated, whereas Canadian goods are less protected from regulation abroad.

Although many of these changes are not unique to the apparel and textile industries, they are nevertheless having an impact upon the conditions in which these industries have operated and continue to operate. It is in the face of these challenges that the former Liberal government established numerous initiatives to enhance the long term viability of the textile and apparel industries. It is why our party voted in favour of Motion No. 164 in 2005. That is why I will be supporting Motion No. 158 in this session.

I would like to briefly speak to some of the accusations by members of the House that the previous Liberal government did not come to the aid of the textile industry and outline some of the former Liberal government's past measures. It is unfortunate that political grandstanding by members of the opposition and the government can get in the way of facts and that members conveniently forget about the many initiatives the Liberal Party undertook to help this industry because we recognized its urgent needs.

In 2005 I made an announcement on behalf of the Liberal government at Peerless Clothing, located in my riding. I announced the elimination of tariffs on textile inputs not produced in Canada as well as additional measures to help strengthen the competitiveness of these industries.

In 2004 the Liberal government introduced the $26.7 million CANtex program to help Canadian textile manufacturing firms become more competitive and to help them get ready to take advantage of new opportunities. This was a program developed to help save the Canadian textile industry and Canadian jobs.

This past September, the Conservatives viciously and without reason cut dozens of cherished and useful programs in all departments and slashed the CANtex program's budget by $25 million, effectively shutting it down and stripping it of the power to help numerous businesses. This meanspirited attack on Canadian textile producers is a perfect example of how this government just does not get it.

Getting back to Liberal initiatives, in 2003 the Liberal government created CATIP, a three year program with a $33 million budget. Thanks to this program for Canadian apparel and textile manufacturers, funding was allocated to over 350 innovative strategic projects to enhance productivity, improve efficiency and identify new markets.

In addition, in 2002, the Canada Border Services Agency was allocated $0.9 million to combat the illegal transshipment of clothing and textiles by less developed countries.

The former Liberal government also advanced the cause of older workers. In 2005, the former member for Ahuntsic, the hon. Eleni Bakopanos, on behalf of the Minister of Human Resources and Skills Development, announced a payment of $5.9 million from the sector council program to four projects administered by the Textiles Human Resources Council. Those projects were designed to support skills development in the textile industry, to promote the economic growth of the country and to increase Canada’s competitive capacity in this sector.

Moreover, Quebec signed an agreement for more than $3 million with the former Liberal government as part of the pilot projects designed for older workers. Under that agreement, the Liberal government of Canada made a commitment to continue to cooperate with Québec to address the needs of older workers and to find long-term solutions.

I would like to emphasize how much the efforts made by the former Liberal government contrast with the actions of the current Conservative government. When they were in opposition, Conservative members attacked the government for its so-called inaction. Today, those attacks seem completely empty because the Conservative government has done nothing special to improve the situation of the Canadian apparel industry or to ensure the security of older workers.

Last week the finance minister had a golden opportunity to deliver real help to the apparel and textile industries when he tabled the budget. He also had a chance to make up for his government's $25 million assault on the CANtex program. Stakeholders in the industry were paying close attention, hoping that the government would heed their pleas and deliver some aid to one of Canada's oldest and most important industries. Unfortunately, the textile and apparel industries received nothing from the government last week.

Some time ago, the Standing Committee on Industry, Science and Technology adopted some 20 recommendations concerning the manufacturing sector. Out of that number, the Minister of Finance included only one recommendation is his budget. The changes to allow accelerated write-off are certainly useful but for the companies that had already invested capital in machinery last year, or this year before the budget was tabled, that is not enough. What about those companies who do not need to invest in machinery but in human resources instead? Those companies also need help in terms of exporting and marketing their products. This latest budget does not give them very much to keep Canada in the forefront of international competition.

One must conclude that workers and stakeholders in the textile industry simply were not fortunate enough to be included among the chosen few that this Conservative budget is addressed to.

This was one of the highest spending budgets in Canadian history, yet the finance minister did nothing worthwhile to help this industry in dire straits. It is truly a sad testament to the short-sighted priorities of the government. In its narrow list of priorities, Canada's textile industry did not make the cut again. Many industries and communities did not either.

Textile IndustryRoyal Assent

6:05 p.m.


Joe Comartin NDP Windsor—Tecumseh, ON

Mr. Speaker, I thank the member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup for introducing this motion, since it gives me the opportunity to speak about this issue.

It has been interesting to listen to the speakers on this motion from the Conservative Party and the Liberal Party. The motion basically says that we have to do something to save this industry, that the government has to step in and make sure it survives. I have absolutely no hope that either the current government or the Liberal Party if it were ever to get back into government are going to do anything to save this industry.

This industry had in excess of 100,000 jobs a little over two years ago and now it has less than 50,000. There has been a full 50% drop in a year and a half since the new rules came into play.

The old Liberal government had the opportunity to do something. We heard the last speaker say that the Liberals did all these things. They did all those things and we got absolutely nothing for it. This sector lost 50,000 jobs. That is how beneficial those programs were. The Liberals had the opportunity to do something.

There was a plan under the WTO that would have allowed them to prohibit the massive incursion of product into this country over the first three years as the rules under the WTO changed. Did the Liberals invoke that? No. They could have restricted that input for a full three years. Did our allies, our competitors in the United States and in other countries, invoke it? Yes, they did. Did they save the jobs in those countries? Yes, they did.

The Conservative government is no different. The Conservatives have the opportunity still to invoke that. We still have 18 months in which this plan could be used. Are they going to do it? Absolutely not.

They are so ideologically hooked into free trade, letting the market decide everything, globalization and all those terms that we hear. That of course ignores what happens when we go down that route, when the government does not play the role it should be playing to protect those jobs. Those jobs disappear.

I want to acknowledge the work of the member from the Bloc in bringing forward this motion. This is the second time he has brought it forward. He brought it forward in the last Parliament and he has brought it forward again this time and rightfully so. We should be doing something, because if we do not, the number of jobs will go from 50,000 to zero. The reason that will happen is the manufacturers themselves have seen the lay of the land. They are moving product in raw form offshore into third world countries primarily. They are exploiting the labour there under reprehensible work conditions. They are also exploiting the natural environment by not meeting any environmental standards whatsoever. Because of the way the trading rules work, that value added product can be brought back into Canada tariff free.

Those 50,000 jobs still exist but they are in China, India and other parts of the undeveloped third world. They are gone from Canada and the other 50,000 will disappear unless we take some positive action.

I find that particularly galling because what I see happening in the textile industry is being mimicked in the auto industry, the sector which is the backbone of the economy in my region. Exactly the same thing is going on. This obsessive adherence to ideological beliefs as opposed to what is practically happening in the marketplace both domestically and internationally is continuing. Again, it is with both political parties, the Liberal Party and the Conservative Party. It does not matter which party is sitting on the government side and which one is sitting on the opposition side, they would be following exactly the same policies and those policies would be leading to the devastation of industries. We are seeing it in the steel industry as well as in the auto industry. Pertinent to the debate today, we can see it in the textile industry and in a number of other ones.

Any industry where there is value added is not being protected. The end result in the manufacturing sector is that overall over the last four or five years we have seen the loss of 200,000 to 300,000 manufacturing jobs. These are well paying jobs. They are jobs and incomes that support the communities where those jobs lie, and those communities in addition to the individual workers are being devastated.

My area alone has lost almost 10,000 manufacturing jobs. Unless there is a quick turnaround in the attitude of government in terms of saying we are going to have an auto policy, we are going to have a policy that is going to protect the textile industry, those jobs are not coming back.

This is not just an economic downturn. This is the disappearance of whole sectors of our economy that we are sending offshore.

The NDP is very happy to support this motion 100%, but I have to say that there is no hope in my party that either the current government, or the Liberal Party, if it ever got back into government, would do anything to implement this motion.

Textile IndustryRoyal Assent

6:10 p.m.


Thierry St-Cyr Bloc Jeanne-Le Ber, QC

Mr. Speaker, I am pleased that it is finally my turn to speak. You saw how anxious I was to participate in this discussion on the motion introduced by my colleague, the industry critic from the Bloc Québécois.

This government has an ideological blindness which is beyond understanding. Several thousand manufacturing jobs in Quebec and the rest of Canada are being sacrificed for a laissez-faire economic approach, for economic natural selection, simply because of an ideological obsession. I think this is unfortunate. Earlier, I heard the member for Lévis—Bellechasse talk about Advantage Canada and its great plans. He tried to convince us that everything was fine. Unfortunately, this is not about verbal sparring, it is about the lives of families who worked for years in the manufacturing sector who are losing their jobs and who are in difficult financial and emotional situations. This can even lead to divorce and family crises, among other things. It is not a joke. It is a serious matter, and frankly, I think it is distasteful that members of the government—like the member for Lévis—Bellechasse did earlier—emphasize that their government has lowered corporate taxes and say that the problem is solved.

We are talking here about companies and people who are losing their jobs in the manufacturing sector. They work for companies that are no longer profitable and therefore close their doors. If they are not profitable, they do not pay any taxes, and if they do not pay any taxes, tax cuts will not do them any good.

The government could make some very simple decisions. The previous Liberal government could also have done so, but chose not to. The Bloc Québécois has been fighting for years to get these decisions made and will continue doing so. There is still hope. We have fought on many fronts, including the fiscal imbalance, our recognition as a nation, recently the reimbursement of the GST to school boards, and a number of others. The battles we have waged for many years are finally beginning to bear fruit. We will continue, therefore, the fight to protect our manufacturing industry, and we hope that it will ultimately be successful and the government will finally listen to reason, as it did in some of our other struggles.

One of the measures suggested in this motion is very simple. It would allow clothing manufactured abroad from Canadian textiles to be imported duty free. This is totally consistent with the international rules. We have the right to abolish duties on certain materials. This measure would stimulate the Quebec and Canadian textile industries. These are simple, rather inexpensive steps that the government could take, but it refuses to do so.

The International Trade Tribunal has handed down a series of decisions that the government never followed up. People from this tribunal appeared before the Standing Committee on Finance this very day. We spoke with them. My hon. colleague and I questioned them.

This tribunal has made decisions including recommendations to the government that would have enabled it to adopt protective measures without contravening our international treaties. We asked how many of these measures had actually been implemented. The answer was none. The purpose of the International Trade Tribunal is to make recommendations of this kind, but none of the protective measures perfectly in keeping with our international commitments has ever been implemented.

I know the Conservatives will say that the Liberals never implemented these decisions and the Liberals will say that the power rests with the government. They pass the ball back and forth but the reality is that, while they try to assign blame, our manufacturing industry is experiencing great difficulties and is in serious trouble.

I almost regret using the term “manufacturing industry” because it might lead some members of this House to believe that it is an abstract concept, as though the manufacturing industry were an entity that exists in and of itself. I would like to remind all members of this House that when I say “manufacturing industry” I want them to think of the workers who make a living in these industries. I want them to think of the spouses who rely on their partners to survive. I want them to think of these families' children who need the income to live in dignity. That is what we are discussing. This is not a debate about semantics, an ideological or philosophical debate. We must act now.

In closing, we must take steps to protect the industry so that as few jobs as possible are lost. Then we must put in place a program for older workers, the POWA that the Bloc Québécois has been calling for for so long now. It is important to do so. If we are unable to limit the number of jobs lost we must at least help citizens and older workers by providing a real program enabling them to bridge the gap between the end of their employment and the start of their retirement. These programs do not currently exist. In its first throne speech, the government promised, as a result of a Bloc Québécois sub-amendment, to get the ball rolling. It announced the introduction of a program on several occasions, but it only came up with a requalification program.

In the manufacturing industries, in many cases, when a company closes its doors in a remote region, in Quebec or elsewhere in Canada, it is often in one industry towns where people work at the same plant their entire lives. Sometimes, both members of a couple work at the plant and lose everything. It is not a matter of whether we can provide them with training to go work at another plant or in another sector because there are no other jobs in these regions. Furthermore, these people are just a few years from retirement.

When travelling through Quebec—and people are also going through this in my riding in Montreal—I have seen these people end up with nothing just a few years before their retirement. Once their EI benefits run out, they have to sell all their belongings, their assets, their home and everything else only to end up on social assistance.

I think that for someone who has worked their entire life, who paid taxes their entire life, who contributed to our society their entire life, this is a sad end and it is too bad the government is abandoning them at a time like this.

In the worst case scenario, this program would cost roughly $120 million across Canada. This is not a lot for a federal budget when there are surpluses of several billion dollars, and this would help maintain the dignity of the people who worked their entire life to build Quebec. The respectful thing to do is to implement this program that already existed and was abolished by the Liberals. The Conservatives promised they would reinstate it, but they still have not done so. We are still waiting and we will continue to fight for this.

Textile IndustryRoyal Assent

6:20 p.m.

Blackstrap Saskatchewan


Lynne Yelich ConservativeParliamentary Secretary to the Minister of Human Resources and Social Development

Mr. Speaker, I thank the House for the opportunity to comment on today's motion, which calls upon the government to act on Motion No. 164, adopted in the 38th Parliament.

As a brief reminder, it proposed two somewhat ill-defined measures to help Canadian textile and apparel industries. Chief among them was the establishment of an industrial assistance policy and an older worker income support program.

The apparel and textile industries play a significant role in the country's economy, serving as a source of skilled employment in cities and communities primarily located in Quebec, Ontario, the Maritimes, British Columbia and Manitoba. These industries, however, are facing continual and far-reaching pressures from an increasingly competitive global market.

As Canadian Apparel Federation executive director Bob Kirke notes his industry faces heavy offshore competition from fashion designers as well as factory workers, remarking “you have to be really good to survive”.

These pressures have made the transformation of the textile and apparel industries from national to globally integrated industries a necessity. There is no sign such challenges will abate in the future. Indeed, the trends suggest an even more competitive global outlook.

The elimination of global textile and apparel import quotas in January 2005, pursuant to Canada's World Trade Organization commitments, resulted in significantly increased competition from low wage countries for Canadian producers.

Although the need to adapt to increased competition is not unique to the apparel and textile industries, or even to the Canadian economy, changes in the global marketplace are nevertheless having a significant impact upon the environment in which both industries have and continue to operate.

What is our government doing? In the face of such challenges, our new government is demonstrating its commitment to the long term viability of both the apparel and textile industries, actively working with them to turn the challenges of today into the opportunities of tomorrow.

To assist the two industries in their efforts to compete effectively and efficiently in the changing global markets, we are working with our U.S. and Mexican counterparts to facilitate the access of textile and apparel companies to world-class inputs. We are reviewing proposals for an outward processing program that may provide new market opportunities for the textile and apparel industries. We are continuing to protect against illegal shipment of imported apparel and textile products. We are working, through the employment insurance program, to continue to meet the needs of workers adjusting to changes in the industry.

We are ensuring, through ongoing support for human resource sector councils, that workers obtain the necessary skills to respond to the challenges of a rapidly changing labour market and identifying and reducing tariffs on imported textile inputs to improve the industry's cost competitiveness.

To underline our commitment to this last point, Canada's new government recently announced the implementation of measures to reduce or eliminate tariffs on a number of textile fabrics used in the apparel industry. These measures will provide apparel producers with up to $4.5 million in annual duty savings.

Canadian Apparel Federation president Elliot Lifson called the announcement “a step in the right direction. The biggest input cost is material so this should encourage manufacturers”.

Such measures are also in line with the goal of “Advantage Canada” to create a Canadian entrepreneurial advantage by encouraging further international trade and investment, while allowing Canadian businesses to do what they do best, invest, expand, and create jobs for hardworking Canadians.

Canada's new government has also demonstrated its continued support of the Canadian apparel and textiles industry program, or CATIP.

Working in partnership with industry associations and other stakeholder organizations, CATIP assists Canadian textile and apparel firms adjust to impacts of globalization through numerous approaches including: industry-wide branding initiatives; support for domestic and international marketing activities such as trade shows, matchmaking events and marketing materials; support for best practices and diagnostic sessions for companies; development of national textiles and apparel portals and e-commerce awareness activities; and, staging of domestic industry conferences.

An additional component of CATIP known as CANtex helps textile companies enhance productivity and reorient production toward higher value-added products for growth markets.

The measures I just outlined clearly demonstrate that our new government is working with both industries to address the challenges of globalization and ensure the continued viability of domestic firms.

We are representing more than the Bloc has ever achieved, or will ever achieve, for the apparel and textile industries. Not only will these measures further boost the competitiveness of these industries, they will ensure continued innovation while making the most out of our key competitive advantages and indepth understanding of niche consumer markets and close proximity to North American consumers.

Canada's new government is confident that by maximizing such competitive advantages we can assist in the renaissance of these important industries. According to Milstein & Co. Consulting a burgeoning renaissance is already underway with a new generation of small clothing manufacturers emerging throughout Canada, stating “The industry will regenerate, there's no doubt about that. It's happening now”.

Additionally, I remind the House of the many measures designed to encourage the entrepreneurial spirit of Canada through the promotion of a more competitive and productive economy.

Accelerating elimination of the federal capital tax, reducing the general corporate income tax and eliminating the corporate surtax will help attract and retain investments in Canada, helping our country respond to the economic challenges of the 21st century.

Before concluding my remarks, I will specifically address the two initiatives referenced in Motion No. 158, namely outward processing and assistance for older workers.

Over the course of the last several months, the Department of Finance along with Industry Canada, the Canada Border Services Agency and Foreign Affairs and International Trade have been working with the Canadian Textile Institute and the Canadian Apparel Federation to develop program options for an outward processing program that would reduce or eliminate the customs duty on imported apparel containing Canadian textiles.

Given that approximately $6 billion of apparel is imported into Canada each year, the textile industry anticipates that such a program would provide new market opportunities for the Canadian textile industry, even if Canadian textiles are used only in a small portion of apparel imports.

In the near future, officials are scheduled to complete their consultations and finalize their evaluation of the options. In conducting this evaluation, consideration will be given to such issues as consistency with Canada's World Trade Organization and NAFTA obligations, and ease of administration.

With regard to the call in Motion No. 158 for increased assistance for older workers, Canada's new government recently brought forward two concrete measures in this respect.

First, this past October, we announced $70 million for the targeted initiative for older workers, to help older workers in vulnerable communities remain active and productive participants in the labour market.

Second, just this January, as promised in budget 2006, we announced the appoint of an expert panel to study labour market conditions affecting older workers.

Clearly, as textile and apparel industries compete in the new era of increasingly challenging global trade, Canada's new government is committed to putting in place the right policies to assist them as they seek to transform these challenges into opportunities.

Textile IndustryRoyal Assent

6:30 p.m.


Vivian Barbot Bloc Papineau, QC

Mr. Speaker, the textile and apparel industries are going through a crisis that is threatening their very survival. Unless something is done, the numerous closures of recent years will only be followed by more closures.

Many would lump all the blame on globalization, but we disagree. The former Liberal government either delayed taking action or did too little, and the new government is no better.

On October 5, 2005, the Bloc Québécois brought before the House a motion that is essentially the same as the one before us today. It was passed by a majority vote. Still, 18 months later, the government has yet to act on it.

We have a duty not to give up, not to let our fellow citizens down, and to start looking for a solution. Time is running out; already, more than 40% of jobs in Quebec's textile and apparel industries have been lost. We are talking about 25,000 jobs in nearly five years.

The apparel industry now employs only 36,000, as compared to 60,000 in 2000 and 90,000 in 1988. In addition, the weight of this industry in terms of manufacturing jobs has dropped from 14% to 6%. It is therefore not an exaggeration to say that this industry is in a very serious crisis.

Obviously, it is difficult for these basic manufacturing sectors to compete with emerging countries, whose wages and working conditions provide a great advantage to large multinational companies. We have to keep a number of these jobs at home, though, and there are several reasons for that.

First, it is practically impossible to compete with the great conditions afforded multinationals in developing countries. We therefore have to help our businesses reposition themselves in the high end textile and apparel market, where we will find significant comparative advantages. This, in turn, will allow us to maintain well-paying jobs.

From a human standpoint, we have to know that these two industries, namely textile and apparel, provide some kind of entry level for unskilled or less skilled workers. That is often where newcomers looking to enter the labour market find their first job.

There has been much discussion recently about immigrants and immigrant integration in Quebec. Work is unquestionably the number one source of pride, dignity and integration in their new surroundings. While not being a panacea, these jobs play a critical role in terms of social cohesion. It is no coincidence that first generation immigrants account for 57% of the manpower in these industries.

In addition, the textile and apparel industry must be able to redirect its efforts into higher-value products. Of course, this will call for investments in research and development, as well as assistance from the government to ensure this development takes place. One can think in terms of high fashion collections, but there are opportunities for other specialized textile products such as medical supplies—I am thinking of artificial arteries and hearts—inflatable pillows and even parachutes.

The picture is not all black for this important light industry, provided, of course, that we act now in collaboration with the companies involved to avoid the tragic plant closings that have taken place in the Huntingdon area and in Montreal.

In the riding of Papineau, which I represent, almost all the jobs related to textiles and apparel have been lost. How long can the 200 workers at the Peter Stone Fashion factory hold on to their jobs? In any event, the fact that prior to my election in 2006, there was a Minister of Foreign Affairs and International Trade in the riding did not prove very useful.

In the face of this situation, the Bloc Québécois is proposing several measures to end the crisis.

First, there is the use of safeguards provided for in trade agreements, by ensuring that import tariffs are maintained on apparel and textiles and restoring quotas on Chinese imports under the WTO access protocol for China. So far, Liberal and Conservative governments have disregarded this proposal.

Then, there are measures that could be implemented to encourage the use of Quebec and Canadian textiles, by allowing the duty-free entry of clothing made abroad from textiles produced in Canada, by imposing stricter rules of origin for less developed countries, by negotiating to include Canada in agreements signed between the United States and countries in Latin America, and by adopting a policy of local purchase, when it is permitted under international agreements.

Next, should be the adoption of an international policy designed to avoid offshoring, by calling on certain countries to raise their minimum labour and environmental standards, and by introducing labelling reforms that would allow consumers to trace the origin of the products they buy.

Finally, we need modernization and conversion of the textile industry through support programs to provide new equipment, research and development, design, etc., that will enable companies to increase productivity and to provide better quality jobs to Canadian workers.

These measures should help stimulate the apparel and textile sectors, and they should enable a region like Montreal to revitalize these sectors rather than watch them die a slow death.

Unfortunately, the Liberal and Conservative governments' inaction has already done its work, and many businesses are in danger of closing. We must also ensure that workers in these factories have the best possible living conditions. That is why the Bloc Québécois introduced a bill to improve the employment insurance program.

The bill introduced by my colleague from Laurentides—Labelle increases the benefit period by five weeks; increases the weekly benefit rate from 55% to 60%; eliminates the waiting period; eliminates the distinctions between new entrants and re-entrants to the work force; increases the maximum annual insurable earnings from $39,000 to $41,500; introduces an indexation formula; and calculates benefits based on the 12 best insurable weeks.

Furthermore, the Bloc Québécois has proposed increasing transfers to Quebec for professional training and creating an income support program for older workers to help older workers who become victims of massive layoffs when companies close their doors.

Lastly, we have proposed implementing a modernization assistance program for the apparel and textile sectors that would stimulate research and development and creation.

All of these measures, which are part of a comprehensive action plan with respect to the future of the textile and apparel sectors, have been made public, have garnered support from observers and are both realistic and humane.

They are an expression of the fact that in a democratic society, nobody should be abandoned to their sad fate and that together, in solidarity, we can get through the toughest times.

Elected representatives must stand with workers and businesses when they need support because everyone's future depends on theirs.

Textile IndustryRoyal Assent

6:40 p.m.


Serge Cardin Bloc Sherbrooke, QC

I would like to know how much time I have left, Mr. Speaker.

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6:40 p.m.


The Acting Speaker Conservative Andrew Scheer

You have three minutes left.

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6:40 p.m.


Serge Cardin Bloc Sherbrooke, QC

In that case, I shall be brief.

We have heard great speeches from members from the Bloc Québécois and speeches from members from the Conservative Party and the Liberal Party which, more often than not, did not hold water.

I will not attempt to go over all what was said in three minutes, but I would like to at least raise Parliament's awareness of the fact that time has come to act.

The Liberal Party was the governing party at the time when the textile and apparel crisis started to unfold. Now the Conservative Party is in office and, as such, it should be able to take robust action. We have to recognize that power tends to render powerless, impotent. My idea of power was different.

We have witnessed the Liberal government's lack of action back in the days. Now we are witnessing the Conservative government's lack of action. It would have been so easy, in a global context, to put forward safeguard measures, legal ones in the eye of the World Trade Organization, to help modernize equipment in the textile and apparel industries and encourage research and development.

A knowledge-based economy entails added value, innovation and creativity. In Quebec, our workforce is capable of creativity and innovation, and capable of producing textile and apparel elements in very specific niches. But the government has proven to be powerless, or rather it did not want to put a lot of effort into saving the textile and apparel industries in Quebec and Canada.

Time has come to bring pressure to bear on the government. The House will have to vote accordingly, and I am convinced that a majority of members will support this motion. The time to act is now, because the clock is ticking. Safeguard measures have to be put forward and the industry has to be modernized as quickly as possible, so that we can forge ahead toward innovation and creativity in these industries.

Textile IndustryRoyal Assent

6:45 p.m.


The Acting Speaker Conservative Andrew Scheer

It being 6:45 p.m., the time provided for debate has expired.

The question is on the motion. Is it the pleasure of the House to adopt the motion?

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6:45 p.m.

Some hon. members



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The Acting Speaker Conservative Andrew Scheer

All those in favour of the motion will please say yea.

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6:45 p.m.

Some hon. members


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6:45 p.m.


The Acting Speaker Conservative Andrew Scheer

All those opposed will please say nay.

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Some hon. members


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6:45 p.m.


The Acting Speaker Conservative Andrew Scheer

In my opinion the nays have it.

And five or more members having risen:

Pursuant to Standing Order 93 the division stands deferred until Wednesday, April 18 immediately before the time provided for private members' business.