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House of Commons Hansard #43 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was pumps.

Topics

Fairness at the Pumps ActGovernment Orders

4:40 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Mr. Speaker, I wish to thank the member for his presentation on Bill C-14 today. I certainly have supported his work over the last number of years on this particular issue, but in terms of this particular bill itself, it seems to me that increasing the penalties is something that is long overdue and should help in the situation. I think the member would more than likely agree with that.

Given that we are bringing in this bill to save basically $20 million, are we looking at the other side, which is the cost to the businesses?

The only time a Conservative government ever brings in consumer legislation is if there is an offset to business, and the offset to business here is that it is going to allow private people to get into the inspection business. It is going to let the inspection services be determined by market forces. That means that these little retailers, in some cases in the rural areas and up north, are going to have to shop around for an inspector, maybe at a cost of hundreds of dollars, to come and inspect their pumps.

It seems to me that with the random system we have right now, inspection by the government, there is no conflict of interest there and that is the system to have. Maybe we should be doubling the number of government inspectors and keeping the inspections on a random basis so that the retailer does not know when the inspector is going to show up.

This proposal says that they have to find their own inspector and that they are going to know when the inspector is going to show up to do the inspections.

Fairness at the Pumps ActGovernment Orders

4:45 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Mr. Speaker, the hon. member for Elmwood—Transcona raises some very important concerns.

I am not in the business of giving false hope to people about what this legislation is going to do. Anybody who thinks that the complaints are going to stop because there are more inspectors is dreaming in Technicolor. What is important for us to understand is how one is doing the inspection.

We have demonstrated, time and time again, that the way in which one actually meters a pump, a slow flow, a quick flow, the prover that is used to compare what is said on the meter and what is said on the actual container requires several standard types of analyses. I do not think most inspectors are up to it. We are asking, in a very short period of time, very critically, that we get a tenfold increase in the number of inspectors. It is going to have an impact on retailers. There is no guarantee of certification.

As I said to the member for Chicoutimi—Le Fjord, we have to ensure that the people who are there are also held responsible. They cannot go around saying as the hon. minister has said, “Your pump is wrong. It is your fault. You are a chiseller”.

Fairness at the Pumps ActGovernment Orders

4:45 p.m.

Liberal

Jean-Claude D'Amours Liberal Madawaska—Restigouche, NB

Mr. Speaker, my colleague explained the situation very well. It is clear that the Conservative government has no desire to make things better. The system is in place. The Conservatives have formed the government for four or five years. We have had problems with gas prices in this country for a number of years, but the Conservatives have done absolutely nothing. Now they have supposedly come up with a solution, but the solution already exists. They form the government, yet they cannot even put rules in place and ensure that the system is properly checked.

Does my colleague agree that the Conservatives have had plenty of time to come up with solutions? They are trying to fool people by talking about rules and measures that exist but that they do not want to strengthen. It is as though they do not want to solve the problem of gas prices in this country.

Fairness at the Pumps ActGovernment Orders

4:45 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Mr. Speaker, the member for Madawaska—Restigouche is quite right. Clearly, the government's position is not meant to solve the competition problem or reassure people that they are getting what they pay for, and it will not do either of those things.

I said earlier that if the government were serious, it would do away with the standard of 15 degrees Celsius, which is what the provincial Conservatives did when they approved the report I submitted in 1998. When you pull up to a gas pump, it indicates that the volume is corrected to 15 degrees Celsius. This means that the volume the consumer gets is lower, because this correction is far higher than the Canadian norm.

The average temperature in Canada is five or six degrees. Even with heat and global warming, it is not 15 degrees. The 15-degree norm is good for Hawaii.

I think this is wrong. If the government really wanted to do something, it could do away with this standard. The other thing it could do would obviously be to reverse its decision to kill the petroleum monitoring system that told us how much was produced in Canada.

Fairness at the Pumps ActGovernment Orders

4:45 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Mr. Speaker, for many years Manitoba had a random system of inspecting vehicles. It was a case where the government inspectors would send out letters over a period of years. One never knew when one would get the letter but over a 10-year period the car would be called in for inspection. People trusted the system because it was a motor vehicle branch person who inspected the car. If it needed repairs, the owner was ordered to a garage to get them done.

About 12 years ago the Conservative government, under the guise of helping the consumer and under lobbying from the motor dealer association, turned the whole affair over to the private sector garages. Basically, it was a licence to print money. The price of used cars went up substantially when the legislation took effect. Garages were proven to be overcharging people because there was a conflict of interest.

We cannot have garages certifying cars when they are in the repair business as well.

Does the member think it is a reasonable idea that people would trust a government inspector, inspecting on a random basis, far more so than one where people had to shop for an inspector who also might have some other conflicts?

Fairness at the Pumps ActGovernment Orders

4:50 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Mr. Speaker, I would want to ensure that there are a number of regulatory organizations, TSSA being an example, that could qualify and ensure that the apprentices are properly trained. That would also limit the conflict of interest.

I understand where the member is coming from, but I want to make it abundantly clear that it is not who inspects. It is how many inspect and the credentials which they bring. Otherwise, there is no veracity to the system and we may be impugning people who ought not to be.

I want to remind the hon. member. Our party got rid of the GST as it relates to rebates for people on home heating fuel and other things. We were concerned about the price of fuel back in early 2000. We acted on those on two occasions.

Fairness at the Pumps ActGovernment Orders

4:50 p.m.

Conservative

Dave Van Kesteren Conservative Chatham-Kent—Essex, ON

Mr. Speaker, I wish to thank the House for giving me this opportunity to voice my support for the fairness at the pumps act, an act that upholds the integrity of many Canadian industries, an act that boosts consumer confidence and promotes competition in the marketplace, and an act that honours the promise my hon. colleagues and I made to Canadians when we formed this government.

I urge members of the House to recall that promise now, to remember the events of two years ago. At that time, gas prices were rising steadily across the country. With each passing month Canadians were pressed to dig deeper into their pockets to drive their children to school, commute to work, and to purchase consumer goods transported long distances to local stores. By spring, the cost of fuel was reaching historic highs.

That is when the news hit. Some retailers were capitalizing on the hardships of Canadians fraudulently. Media outlets covered the story recalling that as a result of inaccurate measurements at the pump, many people paid for fuel they never received. Canadians cried foul and rightly so. The fundamental rights of consumers had been violated. The vital trust between buyers and sellers had been broken. The time-honoured principles that formed the very basis of this country's market economy had been dishonoured.

The Government of Canada took action immediately. We vowed then and there to amend the Electricity and Gas Inspection Act and the Weights and Measures Act. We vowed to ensure that people across the country receive what they pay for at the pumps. We vowed to protect consumers in all trade sectors that depend on accurate measurements of goods.

We made a promise in 2009. Today, we keep that promise. We keep that promise through the introduction of the fairness at the pumps act, a piece of legislation that holds retailers accountable to buyers for the volume of product sold, that enshrines consumers' rights to know what and exactly how much they buy of any product, and that promotes fairness, honesty and decency. These are the values all Canadians cherish.

I am sure many members of the House agree with me. Such legislation is vitally necessary, but will Bill C-14 be effective? Will Bill C-14 accomplish the goals to which it aspires? Will Bill C-14 prevent fraud in the retail petrol sector? These are valid questions.

Too many well-intended laws lack the robustness needed to bring about real change. The Electricity and Gas Inspection Act and the Weights and Measures Act are proof enough. By virtue of these laws it has long been a criminal offence to cheat the measurement of goods and services and so deceive consumers. Still, many retailers fail to follow the letter of the law.

In 2006-07 Measurement Canada made it a priority to get to the bottom of the issue. Indeed, the special operating agency declared its resolve to address the problem of measurement inaccuracy in eight trade sectors, including the retail petroleum sector in Industry Canada's 2006-07 report on plans and priorities.

Since then, Measurement Canada has consulted extensively with industry leaders, small business owners and with members of the public. In each discussion one truth continually resurfaced. One truth that now provides the rationale for the specific amendments to the Electricity and Gas Inspection Act and the Weights and Measures Act presented in the fairness at the pumps act.

There are two types of non-compliant retailers. There are retailers who mislead consumers inadvertently and much more seriously, there are retailers who cheat consumers maliciously.

Let me speak first of all to those who mislead consumers inadvertently. By and large, these are honest retailers. These are decent, otherwise dependable men and women who through ignorance or negligence fail to monitor and maintain the accuracy of their equipment.

At present, the only means to punish even minor contraventions to the Electricity and Gas Inspection Act and the Weights and Measures Act is in the courts. Prosecution, however, is not always the most appropriate means to penalize careless retailers. After all, these are not necessarily felons. These are not people whose actions are so monstrous as to warrant a lifelong criminal record. These are people who should be warned, who should be disciplined, and who should be taught to be accountable for the distribution of their products and services.

For those retailers the solution is simple: more frequent inspections. Under the fairness at the pumps act, businesses would be required to have the accuracy of their gas pumps or other measurement equipment validated and certified regularly by the authorized service providers trained to meet Measurement Canada's performance criteria. Retailers found to be non-compliant with consumer laws would face monetary penalties in line with the severity of their offence.

What about retailers who cheat consumers maliciously? What about the second type of non-compliant retailer who knowingly undermines the accuracy of his or her devices so as to profit at the expense of others? Periodic audits of measurement accuracy are not enough to protect Canadians from such racketeers. Strong enforcement mechanisms are necessary.

Here is where the existing legislation falls flat. At present, the maximum fine for non-compliance is $5,000. A minor offence runs retailers a mere $1,000. The penalties are a pittance compared to the money dishonourable retailers stand to gain. Make no mistake. Tampering with the accuracy of measurements is not a crime of passion or revenge. It is not a crime of hatred or a crime of fear. It is a crime of greed. Money is always the motive. Therefore, let money also be the deterrent. Let criminal behaviour be made less lucrative. Let criminal behaviour be made less compelling.

The fairness at the pumps act would increase court-imposed fines up to tenfold and would add new administrative monetary penalties. Retailers who commit minor transgressions would pay for their non-compliance with a fine of $10,000. Retailers who are more conniving, unscrupulous and deceptive would face fines of up to $25,000 and could find themselves before a judge. Retailers who are found to measure fuel or other goods inaccurately more than once would risk a $50,000 and legal prosecution.

In this way, the fairness at the pumps act would provide what existing legislation lacks: a strong arm to enforce the law and deter criminal behaviour before it starts. For this reason, I am confident that Bill C-14 is not merely a mouthpiece for consumers. Bill C-14 is a champion of consumer rights, with the backbone to defend the interests of Canadians at the gas pump and everywhere else consumer goods are sold on the basis of measurement across this country.

I urge my hon. colleagues to also defend the interests of Canadians. I urge my hon. colleagues to contemplate the merits of the fairness at the pumps act and pass Bill C-14. Indeed, I urge my hon. colleagues to vote in favour of this act with as much conviction, as much determination and as much principle as Canadians did when they elected us as their representatives and entrusted us with the responsibility to protect the rights of consumers.

Fairness at the Pumps ActGovernment Orders

4:55 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Mr. Speaker, it is a real pleasure and tribute to the hon. member. I know his fine standing. We have worked together on a number of files. I appreciate the opinion of the member for Chatham-Kent—Essex. I value his concern and commitment to this issue, as do many others. It works well for me to be with him on the industry committee once again. Much was accomplished in the previous Parliament. I hope the same for the next Parliament.

I am wondering if the hon. member might be able to indicate to us the willingness among his colleagues to look at the big fry. It is important to recognize there are people who might, by accident, create problems with a pump. A pump may break down and the retailer of course would be responsible for that, but we would not say that the retailer had done it deliberately. The member made a very good argument to that effect.

However, when a bank in Canada advocates that people buy a barrel of oil or one of the commodity offerings because oil will be $200 a barrel, it drives the price up artificially and has an enormous impact and damages the economy, industries and consumers alike. I am wondering if he has given any thought to discussing with his colleagues, in advance of the G20 and G8 meetings, the prospect of raising the issue of market manipulation and limiting those who, as swap dealers or as derivatives traders, ought not to have anything to do with the commodities markets.

Fairness at the Pumps ActGovernment Orders

5 p.m.

Conservative

Dave Van Kesteren Conservative Chatham-Kent—Essex, ON

Mr. Speaker, I share the member's fondness for the industry committee. We have both done remarkable work and have seen remarkable work done in that committee. I am very glad that he is on that committee. I also give the member credit for his knowledge with respect to gas prices and the industry as a whole.

I remind the hon. member that this bill deals with a specific problem. This bill answers what our constituents have been asking us to do, which is to remedy a wrong that is taking place in the marketplace.

The hon. member probably has seen me with my book. I take it everywhere and write everything down. One of the things that I have written down in the back is his formula for the price of gasoline. I give him credit for that. I get calls every day and my constituents will say, “This price is being manipulated. What is going on? It has to stop. You are the member of Parliament”.

I tell them that the hon. member for Pickering—Scarborough East has done fine work in figuring exactly the price of gas. It is not rocket science. It is right there. We can figure out the crude, dividing by the number of litres, adding the margin for the refining cost, the profits. That gives us the price of crude, and then we add the refining margin, the Ontario tax, the federal tax, the GST, the retail margin, and then we get the cost at the pump. It is wonderful and is very accurate.

What the member is talking about, and he would agree with me, is that on a number of occasions we tried to see if there was manipulation taking place. We are not seeing that. I know what he is attempting to do and I agree that we need to continue to look at that, but at this point we have not seen any of that.

Fairness at the Pumps ActGovernment Orders

5 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I have the pleasure of serving on the Standing Committee on Industry, Science and Technology, so I know the member who spoke very well, since we have been working together on this issue in committee for a few months now. The hon. member has often seemed to be much more reasonable than his own party.

I believe the purpose of Bill C-14 is to ensure that consumers receive the correct amount of gasoline for the price they are paying, but it does not propose a measure to control gas prices. We need such a measure. Consumers are not paying and will not be paying a fair price, because competition does not work the way it should.

Can the member tell me why the Conservatives did not put any measures in Bill C-14 that would encourage competition and allow consumers to buy gas at a fair price?

Fairness at the Pumps ActGovernment Orders

5:05 p.m.

Conservative

Dave Van Kesteren Conservative Chatham-Kent—Essex, ON

Mr. Speaker, it is going to sound like we have a lovefest at the industry committee, but I think it is fair to say that we have a great rapport. I have a high regard for the member opposite as well. Again, he makes a great contribution to the industry committee.

My answer to the hon. member would be that this specific bill deals with a specific problem. The legislation itself will narrow in on that problem.

He raised the issue with respect to increasing competition. That is a very fair question. It goes to the very heart of what will determine prices. If we do not have enough competition, there exists the possibility of corporations taking advantage of that in prices. He is absolutely right.

In a number of the studies that we have done in the industry committee, we have looked at what is going on in the oil industry. It is very expensive. What seems to have happened in the oil industry is that the number of refineries has been reduced. That is to combat the enormous costs that take place when we refine oil. Today there are fewer refineries in Canada than there were perhaps 20 years ago.

Very near my riding Shell Oil was looking at the possibility of beginning a refinery. That did not happen. I think it spent $10 million just on doing the studies but it has retracted from that.

I would share my feelings with the hon. member. I think we need more competition. We need to encourage oil companies. One of the things we need in this country is another refinery. It would help tremendously with respect to the price of oil.

Perhaps at a future date we could look at that possibility and take that up as a study in the industry committee and produce another fine report from which we could all benefit.

Fairness at the Pumps ActGovernment Orders

5:05 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I am pleased to rise today to speak about a subject that affects a number of citizens. Everyone has an opinion about the price of gasoline and how that price is calculated. In past years, some reports and newspaper articles shed a light on gas pumps that were not accurately measuring the quantity of gas at some retailers. Consumers were frustrated, especially since at the time, gas was even more expensive than it is now. Bill C-14 was introduced in response to these reports.

The Bloc Québécois believes that it is important to modernize the legislation to guarantee better consumer protection and to deter businesses that could profit from these inaccuracies. The government must act as quickly as possible. But first, I would like to outline the position of the Bloc Québécois before I talk about our concerns about this bill.

I would like to begin by saying that the Bloc agrees with the principle of Bill C-14. However, the bill does not respond directly to the issue of collusion, such as recently came to light in Quebec, nor does it effectively prevent sudden gas price increases.

This is an important issue for the Bloc Québécois and we believe that we must continue to try and respond effectively to gas price increases with Bill C-452 because Bill C-14, which we are talking about today, still does not allow the Competition Bureau to initiate an inquiry. It has to wait until it receives a complaint from an individual before launching an investigation. The Competition Bureau does not have the power to investigate if it has not received a complaint.

Although the Bloc Québécois agrees with the principle of Bill C-14, the bill is not an end in itself. It does not deal with the major issue of apparent collusion in this industry. We believe that it is time to make amendments to the Electricity and Gas Inspection Act and the Weights and Measures Act.

First, any retailer that violated the Electricity and Gas Inspection Act would automatically receive a fine of up to $2,000. Inspectors who discover the violation would issue a ticket ordering the offender to pay the fine. The offender could then pay the fine or contest it within the timeframe and according to the terms of the ticket.

The defendant could present a due diligence defence, demonstrating that he had exercised due diligence in order to prevent the offence from being committed. Consequently, it would be up to the retailer to prove that he is not guilty, and there could be additional penalties if the retailer continues to operate in violation of the law.

However, the most important thing, I feel, is that the act would allow the names of offending businesses to be published. In an area such as gasoline sales, if a retailer were found guilty, there would be a serious impact. Word travels quickly in some neighbourhoods and since there are numerous gas stations, some businesses could lose customers. This measure would definitely force certain retailers to obey the new law.

Second, the amendment to the Weights and Measures Act will allow authorities to impose much stiffer fines on offenders.

Under the new provisions of this bill, government appointed inspectors will be authorized to enter the premises where they have reasonable grounds to believe that an infraction has been committed. They will be authorized to examine, seize and keep anything found there, use any computer or communication system found there and prepare documents based on that information. They can also restrict access to the premises and force the shutdown of defective equipment.

As is the case with the Electricity and Gas Inspection Act, a retailer who violates the law repeatedly over several days will face cumulative sentences for each of the days.

Bill C-14 also amends section 35 of the Weights and Measures Act to increase the penalties imposed on offenders. In the case of a first offence, a conviction will carry a maximum fine of $10,000 and/or up to six months of imprisonment.

In the case of an offence prosecuted by indictment, the maximum fine will be $25,000 and/or up to two years of imprisonment.

In cases of repeat offences, the maximum fine for an offence punishable on summary conviction will be $20,000, although the maximum prison time remains unchanged at six months.

If the offence is prosecuted on conviction on indictment, the maximum fine will be $50,000, still with the possibility of a maximum prison sentence of two years.

Lastly, a fine of $10,000, or $20,000 in cases of repeat offences, has been established for offences that are not already covered by the legislation.

Bill C-14 is not meant to frighten retailers, but simply to correct a piece of legislation that no longer meets current standards.

It is only natural that, in 2010, inspectors should be able to ensure that consumers are not being cheated. Consumers must receive the amount they pay for. They must get their money's worth.

All the same, we do have some concerns about the bill, and we intend to raise certain issues when this bill goes to committee for examination.

We believe that Bill C-14 could have included an amendment to the Competition Act. The government should use this bill as an opportunity to introduce additional measures to protect consumers.

I have been a member of the House of Commons since June 2004, and every time we have debated the price of gas and rising prices, the government, be it Liberal or Conservative, has always said the same thing: their hands are tied because the Competition Bureau found no evidence of price-fixing among oil companies. There was therefore no problem.

What we really need to grasp here is the fact that the Competition Act has some major loopholes. The Competition Bureau cannot launch an inquiry of its own accord. Inquiries can take place only at the minister's instigation or if a consumer, a legal entity or otherwise, files a complaint.

I know the government says that it implemented measures to fix the problem as part of the 2009 budget implementation act. However, these new provisions still do not enable the Competition Bureau to inquire of its own accord or to take this kind of initiative.

The inquiry process cannot be launched until a complaint is received. That is how it works right now.

In fact, that is why we believe that the Bloc Québécois' Bill C-452 is still needed. It would enable the Commissioner of the Competition Bureau to inquire into an industry sector if he or she deems it necessary to do so. As it stands, Bill C-14 does not address that issue.

Bill C-452 gives the Competition Bureau the power to take the initiative to carry out real inquiries into the industry if it has good reason to do so, which is not something it can do right now. It cannot act until it receives a complaint.

It goes without saying that if we pass such a bill, the Competition Bureau will be far better equipped to fight companies that seek to take advantage of market dominance to fleece consumers.

I hope that my colleagues of all political stripes in the House will tell us what they think of Bill C-452 and whether they agree with us about the Competition Act's shortcomings. As I said before, the current Competition Act does not allow the Competition Bureau to hold inquiries of its own accord. It cannot launch an inquiry unless it receives a complaint or is authorized to do so by the minister.

For years we have also been calling for a petroleum monitoring agency to closely monitor the price of gas and to address any attempt at collusion or unjustified price increases.

The Bloc Québécois is not alone in recommending changes. For years we have been repeating the recommendations of the Standing Committee on Industry, Science and Technology made in November 2003. The federal government has never done anything to help consumers and has a fine opportunity here to set up a system to monitor the petroleum industry.

In November 2003, the Standing Committee on Industry, Science and Technology strongly recommended the creation of an agency to monitor the oil sector. A committee would be asked to submit an annual report to Parliament on the competitive aspects. The creation of such an agency would enable the government and us as legislators to keep a close eye on the industry.

To the Bloc Québécois, there is no doubt that the Competition Bureau must have more freedom to act and more discretionary power over its inquiries. The Competition Bureau must have access to all documentation when conducting an inquiry. The Competition Bureau could then effectively play its role as an advocate for competition. When there is competition, the consumer pays a fair price.

Only if it is given more responsibility can the Competition Bureau undertake a real inquiry into the true nature of the activities of an industy sector.

Today we are no further ahead than we were seven years ago. Bill C-14 is a step in the right direction, but it is just the first step. For a long time now, the Bloc Québécois has been urging the government to take action to deal with the high prices of petroleum products. Bill C-452 is just the first step in fighting the high price of gas.

Bill C-452 aside, the Bloc Québécois is more convinced than ever that the industry must do its fair share. With skyrocketing energy prices and the oil industry's profits, the economy as a whole is suffering while the oil companies profit. We have to do away with the fat tax breaks the oil companies are getting.

One year after coming to power, in its 2007 economic statement, the Conservative government announced additional tax cuts for the oil companies, which will see their tax rate go down to 15% in 2012. Canadian oil companies will pocket nearly $3.6 billion in 2012 alone because of these tax breaks.

Third, we must reduce our dependence on oil. Quebec does not produce any oil, and every drop we consume makes Quebec poorer, in addition to contributing to global warming. The Bloc Québécois therefore proposes that we reduce our dependence on oil.

In 2009 alone, Quebec imported $9 billion worth of oil, less than usual because of the recession, but in 2008, oil imports totalled $17 billion, up $11 billion from 2003.

To reduce our dependence on oil, the Bloc has proposed substantial investments in alternative energy to create a green energy fund, launch a real initiative to reduce our consumption of oil for transportation, heating and industry, including an incentive to convert oil heating systems, and introduce a plan for electric cars.

We have to get ready, because by 2012, 11 auto manufacturers plan to introduce some 30 fully electric and hybrid models, more reliable cars with better energy efficiency and much lower operating costs than gas-powered cars.

I do not want to get away from the objectives of Bill C-14, but for the Bloc Québécois, any discussion of oil consumption has to include a real plan and a structure for attaining these three goals.

In closing, I will briefly go over the three steps to a more effective law. First, we have to bring the industry in line by giving the Competition Act more teeth. Second, the industry has to pay its fair share of taxes, which means doing away with fat tax breaks. Third, we have to reduce our dependence on oil by, among other things, introducing incentives for consumers to buy electric vehicles.

Better ways to prevent fraud, as Bill C-14 is proposing, are needed, but we must introduce measures that will really benefit us in future, with a comprehensive action plan.

Fairness at the Pumps ActGovernment Orders

5:25 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Mr. Speaker, the member talked, as other members have, about the big picture and the big problem. We have known for a number of years that we need to deal with amendments to the Competition Act because over 125 studies have been done, which prove that the Competition Act is what needs to be changed to ensure more competition.

Would the member take the lead and introduce whatever motion, amendment or bill that would cause that to happen? We have a minority government. We could get together with the member for Pickering—Scarborough East, who is an expert in this area. He recognized the problem many years ago. I have certainly been aware of the problem for a long time. We have three caucuses of a similar mind. Why can we not get together, drive this issue and force the government to deal with the real problem rather than simply nipping around the edges?

Fairness at the Pumps ActGovernment Orders

5:25 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I listened to the member talking about putting in place measures to foster competition, to give more powers to the Competition Bureau. I would like to remind the member that the Bloc recently introduced Bill C-452, which would give the Competition Bureau more powers, including the power to initiate inquiries. At present, the real problem is that the Competition Bureau cannot initiate its own inquiries. It must receive instructions from the minister or conduct an inquiry in response to a complaint filed by a company, consumer or legal entity.

I therefore invite the member and his party to support our bill, which will be debated in future.

Fairness at the Pumps ActGovernment Orders

5:25 p.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

Mr. Speaker, this rip-off of consumers by some of these companies that are shortchanging consumers thousands and thousands of dollars was raised in the House of Commons several times. In fact, if it is across Canada, it is millions of dollars.

A study by Measurement Canada came out quite a few years ago. I read in Hansard that the former minister of industry said very clearly:

I have instructed regulatory changes to be prepared. These will increase the onus on gas retailers. Fines will be increased from $1,000 per occurrence to $10,000 per occurrence.

That was promised on May 12, 2008. That was a good two years ago and still we are here, two years later, debating this bill. Is it not unfortunate that no action has been taken for two years and consumers across Canada have been ripped off millions of dollars as a result?

Fairness at the Pumps ActGovernment Orders

5:30 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, the government could have acted more quickly, especially since, as the member mentioned, a report was submitted in 2008 and a measure is now being proposed two years later.

In Bill C-14, the government talks about better prices resulting from competition, having more competition and having prices that foster competition. I believe that Bill C-14 does not truly address the issue of competitive pricing. It responds to the fact that the consumer purchases a certain quantity. However, the aspect of competition is truly set aside. There should be measures that deal not just with the quantity purchased but also the real price to be paid. To arrive at the real price, there must be competition and, on that matter, the bill is silent.

Fairness at the Pumps ActGovernment Orders

5:30 p.m.

NDP

Carol Hughes NDP Algoma—Manitoulin—Kapuskasing, ON

Madam Speaker, I thank my colleague for his fine speech on Bill C-14. It is clear that an investigative process will not help individual people. I agree with what the member said about not letting the industry govern itself.

There is also the fact that a lot of taxes were paid on gasoline that people never received. So I am wondering if the member agrees that we need a better process for ensuring that people can file complaints, and for refunding certain taxes or services that consumers never received.

Fairness at the Pumps ActGovernment Orders

5:30 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Madam Speaker, when consumers do not receive all of the gas they purchased, it is clear that they have been shortchanged by the business owner. I think this concern or these problems are particularly evident with the purchase of oil products.

The report of the Standing Committee on Industry, Science and Technology, which was put out in 2003, recommended that the government give more investigative powers to the Competition Bureau; it also recommended that the government create an agency to monitor gas prices. If these two measures had been implemented, I believe that consumers would have had justice and would not feel they are at the mercy of the oil companies and are not getting a fair price when they purchase petroleum products.

Fairness at the Pumps ActGovernment Orders

5:30 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Madam Speaker, I would like to ask the member a simple question. Has he noticed a supply problem in Canada and Quebec in relation to the number of suppliers in this industry?

Also, is he worried that companies like Ultramar sometimes pursue predatory lawsuits that are really harmful to retailers, not only in Quebec but also in Ontario?

Fairness at the Pumps ActGovernment Orders

5:30 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Madam Speaker, I think I understand that my colleague is talking about oil companies. At this time, for instance, it is likely that a refinery in Montreal will be closed. But when a refinery closes, the supply is reduced and oil products are taken off the market. This contributes to price increases, which further drive up the price paid by consumers. So there is an advantage to having more refineries and greater supply, so that consumers pay a reasonable and fair price.

Fairness at the Pumps ActGovernment Orders

5:35 p.m.

NDP

Bruce Hyer NDP Thunder Bay—Superior North, ON

Madam Speaker, I am very grateful for the opportunity to speak to the government's Bill C-14. What it is calling a fairness at the pumps act seems to me to have more to do with politics than real fairness.

I was particularly impressed with the long, detailed and interesting speech by the member for Pickering—Scarborough East. He seems to have identified what I have identified, that this is mostly about what the current government has been very good at, very skilfully and successfully, quite often, at changing the channel on what the real issues are.

As I read between the lines, along with the hon. member for Pickering—Scarborough East, this deals with a lot more than just pumps and a lot more than just fixing gas pumps with small errors in them. It would amend the Electricity and Gas Inspection Act and the Weights and Measures Act and would increase mandatory inspection of measuring devices in a whole host of industries like dairy, retail, food, fishing, logging, grain, field crops, mining, et cetera. However, the way it is being marketed and sold here is that it is supposedly about the petroleum sector.

There are about 125,000 gas pumps in Canada, with about 60,000 of them to be inspected every year for accuracy under this bill. Why does this come all so late? It was over two years ago that the Ottawa Citizen and our party in the House reported on investigations that showed government inspections found that about 5% of pumps delivered more or less fuel than reported in the pump display on pumps across Canada. In the 2008 election campaign, the Conservatives were emphatic in saying that they would take immediate action. That is two years of consumers getting hosed, on average, twice a year per consumer. The government has collected taxes on all those overcharged consumers during that time. Why did the government not act sooner?

One thing that is interesting about the bill is it would outsource inspections on all sorts of measuring devices, including gas pumps, to private companies and private inspectors. There would be about 400 to 900 private sector inspectors required to carry out the inspections of the pumps alone. This would add perhaps $2 million in costs for the taxpayers each year. There would be the question of oversight of all these private inspectors. What is to stop a company in the oil business from having its inspectors in this position in a biased position?

A lot of questions are left unanswered by the bill. One problem the bill tries to solve is that while occasionally the pumps give consumers extra gas they did not pay for, far more often they give them less gas than they paid for. That can hardly be coincidental. As a former scientist, the degree of difference here does not seem to be random or accidental.

The bill would increase fines for pump discrepancies to $10,000, or $25,000 for big offences, and would add new fines of $50,000 for repeat offenders.

However, the biggest problem is not inadequate fines right now. Getting caught with inaccurate pumps already results in fines. The problem is authorities do not have the investigative power to gather evidence to impose fines where they are needed in the first place, not with inaccurate pumps, but with the price of gas itself.

Gas station owners should have properly calibrated pumps, and in fact the vast majority do. However, targeting them with more frequent inspections and higher fines is missing the big mark. The bill would use them as scapegoats, and the government seems to be unwilling to tackle the real problem. The bigger problem is not faulty pumps. It is high gas prices and unconscionable margins and probably collusion and price-fixing, prices among competitors that mysteriously go up in lockstep with one another and prices that shoot up quite quickly when the price of oil rises, but never seem to fall very fast or very far when the price of oil drops.

The real problem is that once again we are changing the channel away from the real issues. My region of northwestern Ontario knows this all too well, perhaps better than almost anywhere in Canada. My office hears over and over again from people who feel they are getting hosed. I do not blame them. Over the last 48 hours, eight out of the top ten most expensive pump prices in Ontario were in northwestern Ontario and the other two were in northeastern Ontario. In fact, our gas is usually more than 20¢ a litre more than in most parts of Ontario or in Manitoba.

This weekend while gas prices were as low as 89¢ a litre in Ottawa and 95¢ in Toronto, they were $1.10 or more in Thunder Bay, $1.13 in Terrace Bay and $1.15 in Longlac, among some of the highest prices in Canada. It is outrageous and fines for faulty pumps will not fix this. The problem is not with the pumps and it is not with the small gas station owners either for the most part, who as I said, the vast majority are honest and have accurate pumps. Most do not make very good margins themselves. Most do not even set the prices. It is the big oil companies that set those prices.

If we want to help a minority of consumers getting cheated at faulty pumps twice a year, that is okay. However, what about helping the vast majority of Canadian consumers who are getting gouged every time we fill up on gas? There are lots of unanswered questions. Why are prices in some regions like northwestern Ontario 25% higher most of the time? Obviously, different provincial taxes and periodic problems with refinery supply and shipping play a role in gas prices. The freight cost of transporting gasoline to the northwest is often given as a reason as well, but other regions in Canada just as far away do not have a whopping 25% price difference. As Thunder Bay's the Chronicle Journal newspaper wrote on July 10 of last year when things were really out of hand:

—the one definitive study into city gas prices...determined that prices here should be a maximum of only four cents a litre higher than the rest of Ontario.

What is needed is a public inquiry into price fixing in the gas market and industry oversight with real teeth. I know that when my colleagues in the NDP have called for public inquiries before, the government has suggested that consumers should take their concerns to the Competition Bureau. It knows full well that the Competition Bureau cannot do anything without a smoking gun. About the only time something really gets done is when an informant comes forward from inside the scheme, like we saw in the Quebec gas fixing cartel in 2008.

Virtually all the convictions from price fixing in the last two decades come from that one single case because someone on the inside came forward. In that case, the Competition Bureau commissioner at the time, Sheridan Scott, said an overwhelming majority of gas businesses in the markets involved were accused of participating in the scheme.

Eleven companies were charged with things like illegally fixing gas prices. They were able to convict four and only because they had an informant. I wonder how much similar activity goes on today across Canada that we cannot prove because there are no informants tipping the Competition Bureau off and the bureau does not have the authority to perform more than a cursory investigation of any consumer complaints. It can only investigate violations to the Competition Act, so a great majority of gas price complaints can go nowhere.

I hope the government will be open to starting a real inquiry into the matter and a public investigation of what can be done to really improve the situation for consumers.

One thing my party has been calling for is a gas price ombudsperson. Since the Competition Bureau is so limited in what it can do, we need an ombudsperson who could handle public complaints and give us strong and effective consumer protection.

Our member for Hamilton Mountain has tabled Bill C-286, which would do just that. It would enable Parliament to appoint an independent ombudsperson to investigate complaints about gas pricing and report to the ministry of industry if it is not satisfied with the response from the oil or gas supplier.

If given adequate investigative powers, the ombudsperson would help provide strong, effective consumer protection, including fines of half a million dollars if necessary, to ensure the really big offenders did not get away with swindling consumers. It would help ensure that we paid a fair price for gas so small and independent retailers would finally have proof that they were the good corporate citizens, as most of them are. It would ensure there would be greater oversight and accountability on the big oil companies. It is these big offenders and big distributors we need to go after, even more than those small business people with faulty pumps or the rare unscrupulous gas station owner who might nickel and dime customers.

There is one more thing I would like to bring up when it comes to fairness at the pumps.

No discussion of gas fairness is complete without talking about the harmonized sales tax. As we know, the HST being imposed by the Conservative government on consumers will raise the price of gasoline by 8% in Ontario. This price hike is orders of magnitude more costly than any savings Bill C-14 might ever bring to consumers.

Passing Bill C-14 off as a magic bullet to fix gas gouging, as the government is doing, while hiking gas prices across the board, is the biggest bait and switch in gas marketing history. It has been calculated that the average family of four, through the HST in Ontario, will be hit with an increase of $232 per year, even more in Thunder Bay where it is based on a higher price, and about $900 million across Ontario each year. It is a tax grab.

The Conservative government is tabling a fairness at the pumps bill to crack down on the 5% of pumps that are faulty, but hitting 100% of pumps with the biggest gas tax hike in history. Is this what Conservatives think of as fairness?

To conclude, this bill pays lip service to controlling unfair business practices in the sale of gas. Significant measures need to be added to the bill to make it really worthwhile for Canadian consumers who need it desperately. Do the Conservatives really care about consumers? Do they care about taxpayers? Do they care about average Canadian citizens, or do they really just care about big oil and oil and gasoline distributors?

It is my understanding that the amount of oil and gasoline that we export to the United States is roughly equivalent to what the east coast imports from Saudi Arabia and Venezuela. We know where the real priorities of the Conservatives lie, especially the Alberta-based Conservatives.

I hope the government will prove me wrong and will be open to stronger consumer protection measures in Bill C-14. It will be a litmus test to see whether the government really wants to tackle gas price gouging or if it is all just political positioning.

Fairness at the Pumps ActGovernment Orders

5:50 p.m.

Liberal

Dan McTeague Liberal Pickering—Scarborough East, ON

Madam Speaker, I thank the member for Thunder Bay—Superior North for the compliment on some of the work that has been done. I think we agree with far more than we would disagree.

Could I get from the hon. member a better understanding of where he sees the greatest impetus to be placed on the cost of energy? Would he encourage his colleague, the finance critic for his party, to gently persuade the Minister of Finance to make market manipulation, particularly in the commodities futures market, a priority, particularly as one understands the role that derivative and swap dealers have played in distorting the market as much as 40% and 50% today on the price that we see?

The hon. member will know there is a 4¢ increase coming to his constituents tonight, even though markets and the Canadian dollar have shown virtually no increase whatsoever. I am very familiar with the concerns in his riding having lost a number of independents like Domo and Mohawk, which have been taken over by large players.

Perhaps he could focus his comments on where there is a real problem driving the cost of energy over and above the issue of taxation, over and above the scandalizing of the odd gas retailer that somehow he or she is a chiseller? Could he encourage his members to focus on the G20 and G8, focus on market manipulation, one of the reasons we are spending $1 trillion to help bailout a couple of countries?

Fairness at the Pumps ActGovernment Orders

5:50 p.m.

NDP

Bruce Hyer NDP Thunder Bay—Superior North, ON

Madam Speaker, one of the ironies about the party that I sit with is that I have three small businesses. I do not have much to do with them these days because I am pretty busy here and in my riding, and my managers take care of them

But in the small business community there is lots of competition. Adam Smith's rules of supply and demand work relatively well in the small business community. Having read The Wealth of Nations not once but twice, I would urge the Conservative Party members to read it. There are a couple of big caveats in Adam Smith's invisible hand.

Adam Smith pointed out that the only time his theories of the invisible hand work is when we have lots of small and medium-size buyers and sellers, so that no one distributor or producer can control supply or demand or price. That is the real theory of Adam Smith. That is the real theory of capitalism.

Ironically, on top of that, 87% of all the jobs created in Canada over the last several decades have been by small business people across Canada.

Therefore, the myth that our future, our economics, lies with big business is just that, a myth, particularly when and if there is little or no competition in those marketplaces.

Franklin Delano Roosevelt in the United States and a few other leaders across North America in the last century understood this and acted effectively to control trust, to control predatory non-competition. It is time we had it again.

Fairness at the Pumps ActGovernment Orders

5:50 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, I think the member would agree with me that increasing the penalties is a positive element in the bill, but that the real flaw in the bill going forward is basically the privatization of the inspection services.

I mentioned before that for many years Manitoba had a government run inspection service for vehicle safety. Vehicle owners would get a letter in the mail on a random basis. They would be called in for a safety inspection and a government inspector would fill out a safety report on their car and the people would go to a garage of their choice to get the repairs done.

Around 11 or 12 years ago the Conservative government in Manitoba, under the guise of consumer protection that basically was under pressure from the motor dealers association, decided to make the vehicle inspections mandatory when new cars were purchased.

There were no more government random inspections. They were mandatory inspections. They had to be done by local garages. Guess what? The price of used cars went up considerably when this took effect. There was rampant abuse of the program because the same garages that were inspecting the cars were also the garages where the cars were being fixed.

Therefore, there was incentive to find a lot of things wrong with these cars. As a matter of fact, we had the CBC go into different garages basically on a ghost car basis to find these abuses. It found lots of them. It went back another year to the same garages and found the abuses had not gone away.

Does the member agree with me that the penalties are not the big flaw in the bill? We agree with the increased penalties. However, the fact is that the government is going to basically privatize the inspections. Small businesses in northern Ontario are going to have to shop around to find an inspector to inspect their pumps, when a random inspection done by a government inspector is the way to handle this by hiring a few government inspectors. Perhaps that is the way to go.

Fairness at the Pumps ActGovernment Orders

5:55 p.m.

NDP

Bruce Hyer NDP Thunder Bay—Superior North, ON

Madam Speaker, what we have to shop around for in northwestern Ontario, similar to what the hon. member for Elmwood—Transcona has just said, are inspections on scales and measures of any sort.

When I was younger, whether a person went to the meat market, the supermarket or the gas station, there was a nice, fresh, clean sticker on all those pumps that gave real confidence that it had been inspected relatively recently. I do not know about the rest of Canada, and it would be interesting to find out, but most of the scales, pumps and measuring devices in northwestern Ontario either do not have the stickers anymore or the stickers have peeled off or faded so much that a person cannot even tell when they were put on there.

It has been clear to me for a long time and it has been observed by many of my constituents that we need more inspectors and more zealous inspecting. However, as the hon. member knows, this is true in just about all federal employee hiring and statistics across Canada. We are cutting services.

It is a simple, straightforward game that the Conservatives are good at. First, they cut taxes to large corporations so that they are approximately half of what they are in the United States. They create huge deficits and then say that they cannot afford to do their jobs anymore or have real government professionals doing those jobs to ensure that they are done properly.