Mr. Speaker, I am pleased to rise in the House today to speak to Bill C-55, the Canada-EFTA free trade agreement.
As other members in the House have pointed out, this agreement has been in discussions for a long time. In fact, the European Free Trade Association and Canada first started their negotiations under the Liberals in 1997 but, ironically, it stalled in the year 2000 over shipbuilding issues. Here we are once again, in 2008, talking about concerns over the shipbuilding issues.
There are a number of good reasons why New Democrats have raised concerns about this agreement. Part of it is about the track record of the current Conservative government. All we have to do is look to the softwood sellout and look at the impact of what is happening in ridings from coast to coast to coast around the softwood agreement and some of the subsequent impacts on forestry policy. What we do not have, of course, is any kind of national strategy around forestry.
In addition, in the House today the government was talking about 22,000 jobs being created but what it failed to say is that the jobless rate rose in April to 6.1% and, in fact, manufacturing continued to decline in April with losses in Ontario and British Columbia. The number of factory workers has decreased by 112,000 since April 2007, according to Statistics Canada.
I want to return to forestry for one second because it directly relates to what we are seeing in the shipbuilding sector. With the government's policies around softwood and raw log exports, because of course it has a federal role, what we have seen particularly in British Columbia and my riding of Nanaimo—Cowichan is one sawmill after another close. This has had an impact on the pulp and paper industry because it does not have access to fibre supply.
An article by the Canadian Centre for Policy Alternatives in June 2007 stated:
Numerous opportunities to generate jobs from forest resources are routinely squandered. Absent much-needed provincial forest policy reforms, the situation is poised to get worse.
This short paper addresses two of the more troubling trends plaguing the coastal industry – rising log exports and mounting wood waste...The cost of not turning those logs into lumber and other wood products here in BC was the loss of an estimated 5,872 jobs in 2005 and 5,756 jobs in 2006.
I know we are talking about a free trade agreement and shipbuilding, so I want to turn my attention to shipbuilding. But I think the record in the forestry sector is an important one to note in the House because it directly relates to trade agreements.
The government is saying, “Trust us. We have built in a 15 year window to protect the shipbuilding industry. Just trust us that somehow or other our workers and communities will survive throughout this”. Because the softwood agreement is so fresh in people's memories, it is very difficult to believe that the government will put the measures in place that will actually protect the shipbuilding industry.
In the early 1980s, the shipbuilding industry was a robust industry in Canada and there were a number of shipyards from coast to coast that were very successful, but in the mid-1980s, 1986 or thereabouts, we started to see a rationalization in the shipbuilding industry.
I want to acknowledge the member for Sackville—Eastern Shore. We all know that any time a question comes up in the House with regard to industrial strategy in this country, the member for Sackville—Eastern Shore will remind members that we must put shipbuilding into that context. Although he has been tireless with his advocacy for this, the government and the former Liberal government simply failed to do that.
I also want to mention the member for Halifax who acknowledged the fact that some work has been done to shore up, so to speak, the shipbuilding industry over the last while. However, we do not have a long term sustainable plan. The government itself has acknowledged the critical role that shipbuilding plays in terms of our sovereignty. Yet, it simply has not put the effort into developing that plan.
When the NDP expressed its concerns about the lack of carve-out provisions in this particular agreement, this position was not developed in isolation. This position was developed in conjunction with the industry and the trade unions.
The board of directors from the Shipbuilding Association of Canada and the Canadian Auto Workers Union came before the committee and talked about some elements that they saw as being essential to be included.
We are not just opposing the agreement. We are proposing solutions in conjunction with people who are on the ground in this industry. They have asked for a carve out, saying that shipbuilding must be excluded from the agreement. They said that the federal government should immediately help put together a structured financing facility and an accelerated capital cost allowance for the industry.
Earlier when we heard the minister speak, I put a question to him about the Jones act and the minister said that it was domestic policy. Let me talk about the Jones act for one second.
The U.S. has always refused to repeal the Jones act. It is legislation that has been in place since 1920. It was legislation that was deliberately developed to protect U.S. capacity to produce commercial ships. The Jones act requires that commerce between U.S. ports on the inland and intercoastal waterways be reserved for vessels that are U.S. built, U.S. owned, registered under U.S. law and U.S. manned. In addition to that, and the minister said that this was domestic policy, the U.S. has also refused to include shipbuilding under NAFTA and has implemented in recent years a heavily subsidized naval reconstruction program.
If the United States, and many members of the House will tout it as the bastion of free enterprise, could see fit to work to protect its shipbuilding industry, surely Canada could do the same thing. This is even more critical in light of the sovereignty issue, but also we have the longest coastline in the world. We should have a vibrant and healthy shipbuilding industry, and it should be everything from small pleasure craft right the way up to the large vessels.
I talked earlier about some of the closures. I come from British Columbia and although this was a provincial government decision, we all know that many times provincial government decisions are influenced by policy at the federal government level.
I want to read from a press release of December 13, 2007, from the B.C. Federation of Labour. It said:
While B.C. Ferries holds a $60,000 party in Germany for 3,000 people on Friday, there will be no celebrating the launch of the first three German-built Super-C Class ferries that have cost the province 3,500 direct and indirect jobs and the loss of $542 million in investment.
That release was put out by the B.C. Shipyard General Workers' Federation.
About the B.C. Ferries' tendering, the Canadian Centre for Policy Alternatives said:
Buying Canadian is no longer procurement policy—at least in British Columbia....If BC shipyards do not receive a significant portion of BC Ferries vessel refits and replacement work over the next five years it is doubtful that a single major shipyard will survive—a substantial de-industralization of the BC economy.
Why would the provincial government choose to forfeit a significant tool of industrial development and throw out its ability to use a major crown corporation to support local well-paying jobs?
Further on down in the article it talks about this being:
—simplistic bottom line economics—search the world for ferry bargains. This approach fails to recognize the spin-off benefits to the BC economy of local procurement. Assuming $175 million is spent in BC on ferry refits and a small new vessel over the next five years, these benefits include 1,500 person years of employment, a $78 million increase in household income, a $101 million increase in provincial GDP, and a $32 million return to government revenues.
Those were 2002 numbers so we can only imagine that those numbers would have substantially increased over the last few years.
What we see in British Columbia is a growing income gap. We have a province that is reeling not only from forestry, but from the lack of attention and investment in the shipbuilding sector. In July 2007 the B.C. shipyard workers put out another release. It said:
BC Shipyard Workers Federation says federal Conservative government betraying shipbuilding industry—free trade deal between Canada and European Free Trade Association expected today could throw away thousands of jobs and hundreds of million of investment in BC and Canada.
George MacPherson, president of the shipyard workers, said:
—a federal announcement today to add $50 million over three years to a Canadian shipbuilding financing program is money previously removed from the same program and won't do much to protect the industry.
Therefore, we have this shell game again, where money is taken away, then it is given back and another press release comes out from the government to talk about how wonderful it is.
MacPherson said:
British Columbia has already lost nearly $1 billion worth of shipbuilding work because BC Ferries is constructing several new ferries in Germany...
A national strategic policy development is required, which supports the shipbuilding industry. When the government talks about a 15 year window to do that, it needs to move on it now. In fact, the U.K. has a shipbuilding strategy. I want to read a couple of points from it because these are things that Canada could building on. Its Defence Industrial Strategy: Defence White Paper, of December 2005, stated:
—it is a high priority for the UK to retain the suite of capabilities required to design complex ships and submarines, from concept to point of build; and the complementary skills to manage the build, integration, assurance, test, acceptance, support and upgrade of maritime platforms through-life;...We also need to retain the ability to maintain and support the Navy....To sustain this requires a minimum ability to build as well as integrate complex ships in the UK, not least to develop the workforce, and to adjust first-of-class designs as they develop.
Surely Canada could learn from other nations that have really made efforts to protect their shipbuilding industry.
Again, earlier today people talked about the fact that Norway did not currently subsidize its industry. It does not subsidize its industry because the government of Norway, over a number of years, put subsidies in place, developed a long term industrial strategy and looked at training and support of the workforce.
We would expect to see that kind of initiative from the government. Because people keep talking about how long a time span 15 years is, what should be done is the carve out should happen so those plans can be put in place and our shipbuilding industry can build on its already considerable strength, because we are world class shipbuilders. However, we need to ensure we invigorate and support that industry.
I would argue it is even more important we carve it out and ensure that we put those supports in place.
The member for Halifax mentioned this, but I want to re-emphasize it. The president of the Shipyard General Workers' Federation of British Columbia said:
The Canadian shipbuilding industry is already operating at about one-third of its capacity. Canadian demand for ships over the next 15 years is estimated to be worth $9 billion in Canadian jobs. Under the FTAs with Norway, Iceland, and now planned with Korea and then Japan, these Canadian shipbuilding jobs are in serious jeopardy. In these terms, this government's plan is sheer folly and an outrage.
Again, that is the labour side of it.
Let us talk about the president of the Shipyard Association of Canada, who retired from Irving Shipbuilding Inc. He said:
So our position from day one has been that shipbuilding should be carved out from the trade agreement. We butted our heads against a brick wall for quite a number of years on that and we were told there is no carve-out. If the Americans, under the Jones Act, can carve out shipbuilding from NAFTA and other free trade agreements, as I believe the Americans are doing today with Korea, or have done, why can Canada not do the same?
We have to do something to ensure shipbuilding continues. The easiest thing is to carve it out from EFTA. And if you do one thing, convince your colleagues in government to extend the ship financing facility, make it available to Canadian owners in combination with the accelerated capital cost allowance, and you will have as vibrant an industry as exists.
It is very important that we continue to push for an amendment of this agreement which carves out shipbuilding to ensure our industry stays viable.