Mr. Speaker, it is a pleasure to speak to this motion put forward by my hon. colleague from Thunder Bay—Rainy River.
Our government spent about $280 billion last year on goods and services. This represents about $1.00 in every $5.00 that we spend in our economy. Given the size of these expenditures and the importance they are to our country, we need to take great care in how this money is spent.
Both the current government and the previous Liberal governments had taken the approach that the lowest price is the law when it comes to procurement in general and, specifically, in transportation, regardless of the impact of how that money is spent on our economy and on our society.
So, what happens? We have situations such as the situation in York region in 2004 where 30 brand new buses were purchased with public funds and not purchased from one of the several Canadian domestic bus manufacturers but, rather, from Belgium. We could say good for the Belgian economy and good for the Belgian bus manufacturer, but very bad for the Canadian economy.
Just last summer, the federal government awarded a military contract for troop buses to a German bus maker over a Winnipeg manufacturer because the German bid came in $2,000 cheaper per bus, which was .5% of the overall price in the $14 million contract. So, a Winnipeg bus manufacturer and all of the jobs that would have resulted from that, plus the taxes that would have been paid by the company and by all of the employees of that plant plus all the ancillary services and support, plus all of the parts that went into those buses, were lost by this federal government.
These are just two examples out of the many instances that we could cite over the last several years of Canadian procurement gone awry.
Other countries, including our major trading partner, stand up for their own economy and their own industries and services. The Europeans, the Japanese and even the Americans, especially the Americans, protect their own domestic market in this fashion.
Of course, one application is the U.S. buy America act which applies to all contracts over $100,000. For vehicles such as rail cars and buses, there is a 60% content requirement and for iron and steel, there is a 100% content requirement. This is perfectly allowable under NAFTA as chapter 10 of NAFTA excludes grant programs, and state and provincial procurement. So it is completely in keeping with our trade commitments.
In fact, the Canadian Manufacturers & Exporters Association went further last week with its report on renewing Canada's infrastructure. CME head Jayson Myers said: “If we continue to be boy scouts to the world, we'll continue to lose investment and lose product mandates elsewhere”.
The CME further said:
By leveraging these investments, governments in Canada would level the playing field to international standards for transportation equipment and infrastructure manufacturers in Canada, reduce business uncertainty by forcing clear, full and open competition for all contracts, and help government effectively address the legal and political controversy surrounding sole-source contracting.
The CME was talking about all infrastructure, not just transportation.
I want to give an example of sole-source contracting. When the leader of the NDP negotiated with a previous Liberal government to take $5.4 billion in corporate tax cuts and insisted that the money be invested for Canadians to meet the goals of Canadians, part of that money was invested in transit across Canada. What that meant in the city of Toronto, for example, was that the city was able to purchase buses, and not just any buses but low-emissions buses, hybrid buses in order to reduce pollution on the streets of Toronto.
They are accessible buses that are easy for people to get on and off. Best of all, those buses were made right in Mississauga, so they were able to ensure local production, ensure jobs in addition to the spin-offs of that plant and all of the taxes and benefits that go with such a procurement.
Canada clearly needs to catch up and follow the lead of our major trading partners. The federal government announced investment in infrastructure and a significant portion of that needs to go to Canadian companies. Our procurement policies need to invest in our products and services and all of the spin-offs that I have described. The requirement to do this simply does not exist in Canada and that needs to change.
When the federal government funds infrastructure, transportation projects, this funding has to ensure a minimum of local benefit. So I would argue that all procurement should meet the test of these Canadian procurement measurements, not only transportation. Now this is done on a case by case basis with relatively low Canadian content levels, but this does little to reduce the uncertainty for manufacturers to sole-source here who do not currently produce in Canada today.
If we leveraged the money that we spend collectively, of all governments throughout the country, for public procurement, we would ensure that not only the manufacturers we have today in Canada but other manufacturers would come to our country, invest here, create jobs, and boost our economy in order to compete for those dollars.
With all of the challenges that are facing our economy today with the high dollar, and a driven high petro dollar because of reckless tax cuts put forward by the current government and previous governments that are in fact helping to fuel a high oil price economy that we are faced with, and other stresses that our economy is facing today, we need to take action.
This government has neglected the manufacturing sector. Defining requirements for public procurement and ensuring domestic sourcing of procurement is one major way to boost our manufacturing sector, boost our economy, reduce unemployment, and maintain and create good, quality jobs in services, but especially in the manufacturing sector.
So, while I do believe that this motion falls short in terms of not requiring specific content levels and while not applying to all procurement, which I believe is appropriate and which other countries do, I certainly believe that this is a positive step.
I see that my time is just about out. I would urge all members of this House to vote in support of this motion and take this as one step along the path to finally catching up with our G-7 partners in ensuring that we are standing up for Canadian production.