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House of Commons Hansard #60 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was financial.

Topics

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:35 p.m.

NDP

Thomas Mulcair NDP Outremont, QC

Madam Speaker, indeed I made my comments in English this morning for the innocents across the way, as my friend from Hochelaga referred to them. However, I am pleased to repeat in the language of Molière what I said in the language of Shakespeare.

The documents filed with the courts show that the Royal Bank of Canada, which comes under federal jurisdiction, knew since November 2001 what Earl Jones was doing. It did nothing.

Those in charge of regulating the banks in Canada have known about this since the documents were filed and they have so far done nothing about it. To date, the victims of Earl Jones have received nothing. This comes under federal jurisdiction. No one is disputing the fact that the banks are the federal government's responsibility.

Let them mind their own business, figuratively and literally. Regulating the banks is their business; let them take care of it. However, they are doing a poor job, a very poor job, and they have the gall to claim that they are going to take over a provincial jurisdiction—property and civil law—that has been part of our federative pact for 150 years.

The Conservatives are talking out of both sides of their mouths. First they say they recognize the nation of Quebec and then they proceed to invade a provincial jurisdiction like this. They are going to reduce Quebec's political weight in the House of Commons.

Everything they do is against the provinces, especially Quebec, but when they speak in the House, they say they are here for the public good. That is false. The OECD considers Canada's current system to be the second best in the world. Let us not fix it if it is not—

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:35 p.m.

NDP

The Acting Speaker NDP Denise Savoie

The hon. member for Kitchener—Conestoga.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:35 p.m.

Conservative

Harold Albrecht Conservative Kitchener—Conestoga, ON

Madam Speaker, I am not sure whether I qualify for the previous speaker's comment about being one of the simple-minded across the way, but let me try a question.

Many times during his speech he said that it was wrong for the federal government to move into this sphere.

I wonder if the hon. member would also say that these particular groups are also wrong, then, for showing strong support for this initiative: the Canadian Labour Congress; the National Union of Public and General Employees; CUPE; the Toronto Star; and the Canadian Centre for Policy Alternatives, which noted in a report that “[the lack of a national securities regulator is a clear “black hole” in Canada's financial regulatory system”.

Perhaps it includes his former NDP finance critic, the member for Winnipeg North, Judy Wasylycia-Leis, who called this a worthwhile goal, or maybe his leader, who indicated at a Board of Trade meeting just this past January that he would like to see us moving toward national securities regulation. Which of these is wrong? Are they included with the simple-minded on this side?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:40 p.m.

NDP

The Acting Speaker NDP Denise Savoie

Before I turn it over to the member for Outremont, I would just like to remind all members to be mindful of the language used in the House and to use respectful language to all members, regardless of their opinions.

The hon. member for Outremont.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:40 p.m.

NDP

Thomas Mulcair NDP Outremont, QC

Madam Speaker, I thank you very much for calling him to order on his choice of language, because I used the same term as he did, innocent, which means that they are not guilty. Somehow he decided that it meant that he was simple-minded. If that is what he thinks about himself, there is not much I can do about it. However, I will defend him from calling himself simple-minded, and you will too. I think that is a very good thing in this House. You are completely right, Madam Speaker.

It is quite clear if one reads the case the government always cites as the example of why, somehow, big brother from Ottawa knows best and can come in and take over the field of securities regulation. It is Earl Jones. On November 7, 2001, the Royal Bank knew that Earl Jones was defrauding his clients. It is here in black and white in the official court documents. The federal government is responsible for banks. It did nothing. The federal regulator responsible for banks did nothing. The Royal Bank of Canada did nothing.

Before the government tries to take over somebody else's jurisdiction, why does it not start taking care of what it is responsible for but that it is misadministering and is incompetent in. The government is not capable of taking care of its own things, yet somehow, it imagines itself being better.

It is not an argument about the Toronto Star. What a surprise. The Toronto Star wants Toronto to become responsible. What a surprise.

Look at the objective elements here. The objective element is that the OECD says that Canada's current regulatory structure in the field of securities, the passport system, is the second most efficient in the world. That is why the Liberals say that it is imprudent and irresponsible to be spending money, and we should withdraw this bill. That is why the Bloc is proposing to withdraw the bill. That is why we agree that the bill should be withdrawn.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:40 p.m.

Bloc

Robert Carrier Bloc Alfred-Pellan, QC

Mr. Speaker, I commend my colleague from Outremont on his fine presentation and his insight. This adds to the importance of our motion today. This morning, the Parliamentary Secretary to the Minister of Finance listed all the good reasons for establishing a single regulator. He said that it was in the best interests of what is good for the country as a whole.

Given that 155,000 direct financial sector jobs in Montreal, Quebec, and another 300,000 jobs in the financial sector as a whole are being jeopardized by this government initiative, could the member sum up the government's thinking, which is basically that it wants our money and will get it?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:40 p.m.

NDP

Thomas Mulcair NDP Outremont, QC

Madam Speaker, that is about it in a nutshell. But seriously, I should remind my colleague that one of the reasons why Canada is such a great success is that it was always understood that the different components that came together to form this great country had their place in the Constitution.

It is because of the room provided to the provinces that Quebec was able to develop its own bodies, its own financial institutions and so forth. More specifically, the only predominantly French-speaking province, with its civil law, was able to develop and to uphold its institutions.

I am going to switch to English to end, in response to my colleague, to say this to the Conservatives. Not only are they making a mistake historically, legally, institutionally, and constitutionally, they are making a mistake politically. What they are doing is providing more arguments to people who say that the only way for Quebec to survive and keep its talent and great people is to separate.

What the government is proposing to do will destroy a large section of economic activity in Montreal. It will withdraw from Montreal some of its most capable diplomats from HEC, Hautes Études Commerciales, the MBAs and the like, who will no longer be able to stay and work in Quebec in these fields. They will have to expatriate to where people are saying it is a great idea to send them.

That is what the government is not thinking about, but that is typical of the Conservatives. They never think any further than the ends of their noses. They are such ideologues. They believe that simply by affirming that the federal government can do it better, that somehow it is true. Objectively, as we have demonstrated today, it is false.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:45 p.m.

Bloc

Robert Carrier Bloc Alfred-Pellan, QC

Madam Speaker, I will be sharing my time with the member for Chicoutimi—Le Fjord.

This morning, my colleague from Hochelaga, with whom I have the pleasure of sitting on the Standing Committee on Finance, moved the following motion:

That this House denounce the government’s unrelenting efforts to marginalize the Quebec nation, in particular by depriving it of the major economic lever of securities regulation, a matter that is under the exclusive legislative jurisdiction of Quebec and the provinces and for which they have established a harmonized regulatory system recognized for its effectiveness by the OECD and the World Bank, among others, and that it demand, along with Quebec’s National Assembly and the business community in Quebec, that the government immediately withdraw its draft bill.

The elected members of this House must have their say on this issue, because as we know, on May 26, 2010 the Conservative government introduced proposed legislation that would create a Canadian securities commission. The Bloc Québécois is strongly opposed to this attempt by the federal government to interfere in Quebec's jurisdictions. Under the Constitution, Quebec and the provinces have exclusive jurisdiction over securities regulation. The federal government's proposed Canada-wide securities commission ignores the fact that Quebec has responsibility for property and civil rights.

In addition, the current passport system works. With this system, a company that registers in one participating province can do business with people in all the other participating provinces.

This Canada-wide commission will strip Quebec of a very important economic tool. Major decisions will be made outside Quebec. As everyone knows, the Autorité des marchés financiers, Quebec's securities regulator, has a knowledge of Quebec's distinct nature and needs that a single commission in Toronto will not have. Jobs in the financial sector are threatened. This is a key sector of Quebec's economy that accounts for 155,000 direct jobs. In all, 300,000 jobs in Quebec are connected with the financial sector, which gives an idea of the impact of creating a Canada-wide commission.

With their proposed Canada-wide commission, the Conservatives are trying to do Montreal out of what it has for Toronto's benefit and are encroaching on Quebec's jurisdictions. For these reasons, the National Assembly and the business community in Quebec reject the proposal.

Voluntary membership is a ploy. By destroying the passport system and counting on conflicts among the regulatory bodies, the Conservative government is creating a reason for issuing organizations to turn to the national commission. Contrary to what the Conservative government is saying, the existence of such a commission would not have prevented investors from being fleeced by white-collar criminals such as Earl Jones. He was a criminal who was not registered anywhere. In Montreal or in Toronto, he would have committed his crimes the same way. It is up to the RCMP to hunt down criminals. Similarly, the existence of a single commission in the United States did not prevent Bernard Madoff from defrauding investors of over $50 billion.

It is obvious that this commission will also be detrimental to the use of French in business. It is unlikely that companies registered with the single national commission, whether or not they are from Quebec, will be required to publish in English and French.

The Bloc Québécois reiterates its opposition to the creation of a national securities commission. The Bloc Québécois supports the current harmonization of the rules governing the financial system. The passport mechanism maintains the autonomy and jurisdictions of Quebec and the provinces. This mechanism has existed since 2008 and is also used in the European Union.

Creating a national securities commission goes against the wishes of the National Assembly, which unanimously adopted a motion in that regard on May 27, the day after the introduction of the Conservative government's draft legislation to create a national securities regulator:

That the National Assembly denounce the obstinacy of the federal government in tabling unilaterally a bill to create the Canadian Securities Commission; that it denounce this invasion into the fundamental jurisdictions of Quebec; that it recall the opposition of the Quebec business community; that, finally, it urge the Canadian government to reconsider this decision and, failing that, the Canadian Parliament not to pass such an act.

The Bloc Québécois position also acknowledges the growing concern of the business community with regard to the Canada-wide commission. The president of the Fédération des chambres de commerce du Québec, Françoise Bertrand, said:

In addition to potential job losses resulting from this project, we are also concerned about a significant transfer of decision-making positions and expertise out of Quebec. Montreal, as a financial centre, and Quebec will be weakened.

A coalition of representatives from Quebec's business community is opposed to a national securities commission

Here are just a few of them: the Québec Mineral Exploration Association, the Québec Bar, the Caisse de dépôt et placement du Québec, Cascades, the Board of Trade of Metropolitan Montreal, the Quebec City chamber of commerce, the Chambre des notaires du Québec, the Chambre de la sécurité financière, the Conseil du patronat du Québec, the Fédération des Chambres de commerce du Québec, the Power Financial Corporation, the Solidarity Fund QFL and Le Groupe Jean Coutu. I will not go on because the list is too long. The entire business sector is opposed to a centralized securities regulator.

I would now like to read a Government of Quebec news release dated May 13, 2010. I think this is important because it sums up the Government of Quebec's official position and is not subject to interpretation.

Quebec's Minister of Finance, Raymond Bachand, condemned statements by a number of Conservative government ministers and members who are using weak, questionable arguments in an effort to sell their proposal for a centralized securities commission and denigrate the perfectly functional existing system.

The minister pointed out that, in Canada, securities regulation falls under the constitutional jurisdiction of the provinces and territories. The minister emphasized the fact that, “The OECD has ranked Canada second in the world [as previously mentioned] with respect to the quality of its securities regulation, while the World Bank has ranked it fifth for investor protection, placing it ahead of the United States”. He added, “Given these international organizations' approval of Canada's financial system, it is clear that the provinces are fulfilling their responsibilities under their constitutional jurisdiction. Provincial commissions, which are in touch with consumers and work with their counterparts, provide the best possible protection to consumers in Quebec and the other provinces”.

The minister noted that the federal government has structured its disinformation campaign around a document filled with unfounded hypotheses. The government is falsely suggesting that Canada's current system increases the cost of raising capital, claiming that this leads to major financial losses and a negative impact on employment in the sector. Mr. Bachand emphasized that several analyses show that costs in Canada are equal to or even lower than those in the United States.

In conclusion, Minister Bachand said:

I am appealing to the sense of responsibility of the federal Conservative government's ministers and members, whose negative and irresponsible comments about this matter have created instability and tarnished Canada's reputation for securities regulation.

I ask the members of the House to support this motion if recognizing the Quebec nation means anything at all to them.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:55 p.m.

Conservative

Harold Albrecht Conservative Kitchener—Conestoga, ON

Madam Speaker, it is really not surprising that a Bloc member is not interested in strengthening Canada's economy.

There have been a number of reports that show that a national regulator would better protect investors. It would reduce unnecessary costs and, therefore, attract new international investment. A Colombia University study showed that Canada loses $10 billion a year in economic output and 65,000 jobs because of our fragmented securities system.

It has been pointed out many times that this new regime would be voluntary. I would like to ask my colleague, why would he be opposed to a voluntary system that would strengthen Canada's economy?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:55 p.m.

Bloc

Robert Carrier Bloc Alfred-Pellan, QC

Madam Speaker, I believe that the Bloc Québécois wants a positive and functional approach for the country as it exists now. We know and our colleagues have often described it: Canada is a large country with 13 securities commissions. And all the observers and all the users say that the system works very well. There is no reason, no urgency and no need to change the system.

The government's bill does not mention the fact that it has recognized the Quebec nation. If the Conservatives were serious about this distinction, they would accept that it could perhaps be useful for this nation to choose how it will function because, after all, the current system is working for Quebec. What is more, Quebeckers, their government and all the business communities want the system to remain as it is. It is the government that is opposing the current, properly functioning system in this country.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

12:55 p.m.

Liberal

Mario Silva Liberal Davenport, ON

Madam Speaker, before asking my question, I would like to congratulate the Portuguese community because today, June 10, is Portugal's national holiday. I would also like to congratulate a number of people, including Joe Eustaquio, who has organized a festival, a very big feat in my neighbourhood. I would also like to congratulate Frank Alvarez, who was honoured by the City of Toronto. He has had a street in Toronto named after him. It is a very important holiday for Portuguese communities around the world.

I would simply like to point something out to my dear colleague. The Bloc motion indicates that it is very much against the idea of a national system wherein each province has the right to a strong presence in the system, as the government is proposing.

Could my colleague clearly explain why the Bloc is against a system whereby the province would maintain its own jurisdiction as well as the right not to participate in this system?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1 p.m.

Bloc

Robert Carrier Bloc Alfred-Pellan, QC

Madam Speaker, I thank my colleague for his question. It is also my pleasure to join with all those celebrating Portugal's national holiday. Many of my constituents are originally from that country, and I am pleased to join in that celebration.

Now, to answer his question, which is a pertinent one and is somewhat similar to one that was put to me earlier, with respect to the fact that, even if a single regulator were established, Quebec could go it alone and keep its own system. It is a fantasy to think that it could work. It is easy to say that we can keep apart if we want to. I think, however, that all security issuers will want to be part of the overall system that was put in place for everyone. Since the current system is working, I see no sense in breaking something that is working, and risk introducing malfunctions that do not exist right now.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Madam Speaker, thank you for this opportunity to speak on our opposition day, on a topic that gets a lot of coverage in the newspapers. Members will understand that it is very important for the Bloc Québécois to have a debate on the importance of respecting Quebec's jurisdiction over securities.

By moving forward with a Canada-wide securities commission, the federal government is going after Quebec's economic leaders. The Bloc Québécois sees this as a veritable attack on the Quebec nation and its institutions. The commission favours the Toronto Stock Exchange at the expense of the Montreal Exchange.

Since it was elected in 2006, the Conservative government has been paving the way for the creation of a Canada-wide securities commission. By claiming that a company will be able to operate under the Quebec securities commission if it chooses to, and by saying that it will prevent Vincent Lacroix and Earl Jones from victimizing more people, the Conservative members are distorting the debate and using false and twisted logic to justify their decision.

Such a commission would not have changed anything for the victims of Earl Jones, and the government knows that full well. The federal government currently has complete authority to protect investors under the Criminal Code. These are false pretexts.

Worse yet, by introducing such a bill, the Conservative government, through the Minister of Finance, is ignoring the protests from across Quebec and rejecting the opinions of organizations like the World Bank and the OECD, which believe that the current system is inexpensive and very efficient.

I would like to quote from an analysis by Yvan Allaire and Michel Nadeau that appeared in Le Devoir on January 30, 2009. They were talking about an important aspect of creating a national securities commission.

We can understand why the Minister of Finance wants to spend to stimulate Canada's economy, but spending $154 million to create a national commission puts the lie to the argument that having a single securities commission would save money.

However, $154 million will seem like nothing if all the companies regulated by a federal, national agency are required to communicate with Canadian investors in both official languages.

How could anyone justify preventing a francophone investor anywhere in Canada from receiving a French version of all annual reports and other financial documents issued by a publicly traded, federally regulated company? Canadians who eat cereal for breakfast are informed in both official languages of the contents of their cereal box, no matter where they live. So why would it be any different when it comes to a national organization that is supposed to ensure Canadian investors are adequately informed in their official language?

Let us look at a concrete example. In the spring of 2008, Visa Inc. became a publicly listed company in Canada. To avoid the costs and time involved in translating the prospectus that was required...Visa decided not to distribute and sell its shares to Quebec investors. How would that be possible with a national commission? How could a federal agency endorse a scenario that would deprive francophone investors outside Quebec as well as in Quebec of information in French?

At this time, even among the 253 largest listed companies in Canada, the companies making up the TSX/S&P Index, only 81 (37%) publish their annual report in French as well as in English. And only 60% actually provide a French version of the all-important management information circular, the proxy document that provides information on executive compensation, on board members proposed for election as well as on any special resolution submitted to a vote at the shareholders' meeting.

A greater number of the thousands of small and medium-sized companies listed in Canada would have to pay the significant cost of translating all their documents provided to investors. Proponents of a national securities commission must answer this question before continuing much further with this controversial plan.

Maintaining the current situation, which is satisfactory for everyone outside Toronto and Ottawa, would save $154 million and spare Canadian companies, which have other priorities, tens of millions of dollars in translation costs.

Mr. Allaire and Mr. Nadeau make an important point and I would like to use my speech to ensure that members of the House of Commons are well aware of this problem.

The Bloc Québécois has chosen this topic for its opposition day because it is an important issue. Securities regulation is an exclusive constitutional jurisdiction of Quebec and the provinces. The federal proposal for a national commission does not respect Quebec's responsibility for property and civil rights.

In reality, authority over securities is given to the provinces by virtue of their jurisdiction over “property and civil rights” under subsection 92(13) of the Constitution Act, 1867.

I will provide a short summary of five reasons why we oppose a national securities commission.

First of all, this Canada-wide commission would divest Quebec of a very important economic tool. All major decisions would be made outside of Quebec. The Autorité des marchés financiers du Québec is sensitive to Quebec's needs, and this would not be the case with a Canada-wide commission.

Furthermore, it would jeopardize thousands of jobs in a key sector of the Quebec economy, which consists of 150,000 direct jobs in the financial sector. All together, 300,000 jobs in Quebec are linked to the financial sector. Although we do not know exactly how many jobs would be affected, it would have a definite impact.

Third, by going ahead with this, the Conservative government is sending a clear message to Quebec, taking this away from Montreal for Toronto's benefit, and infringing on Quebec’s jurisdictions. That is why the National Assembly and Quebec's business community so strongly oppose this plan.

The Minister of Finance can pretend otherwise all he wants, but voluntary membership is a sham. By destroying the passport system and counting on conflicts among the regulatory bodies, the Conservative government is creating a magnet to encourage companies to turn to the Canada-wide commission.

Lastly, contrary to what the Conservative government is saying, the existence of such a commission would not have stopped white-collar criminals like Earl Jones from fleecing investors. Earl Jones is a criminal who was not registered anywhere. Whether in Montreal or Toronto, he would have committed his crimes all the same.

The National Assembly passed a unanimous motion claiming exclusive jurisdiction over this matter. At this time, there is a general outcry among all economic players in Quebec to oppose the federal government's plans. Worse yet, federal Liberal members from Quebec, like their Conservative colleagues from Quebec, support the creation of this single securities commission.

I will close by saying that we in the Bloc Québécois strongly oppose this bill.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:10 p.m.

Conservative

James Rajotte Conservative Edmonton—Leduc, AB

Madam Speaker, I have two very quick questions. My colleague quoted the OECD in his remarks, which is important. In fact, with respect to security regulations, it stated:

—each province has its own securities regulator...increases the risk that firms will choose to issue securities in other countries. A single regulator would eliminate the inefficiencies created by the limited enforcement authority of individual provincial agencies.

Why does he disagree with the OECD with respect to Canada having a national regulator?

Also, there have been some real success stories in the province of Quebec and in Canada. Couche-Tard and others have made a lot of investments outside of Canada, namely in the United States. Would the member encourage other countries like the United States to adopt a more regional method of regulating securities like we currently have in Canada or would he want the U.S. to maintain a national regulator to make it easier for companies like Couche-Tard to invest and grow outside the province of Quebec and outside of Canada?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:10 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Madam Speaker, I want to thank the hon. member for his question.

I want to remind the hon. member that there are two nations in Canada: the nation of Quebec and the nation of Canada. Let us remember that in the Constitution Act, 1867, this responsibility was assigned to the provinces.

He mentioned the OECD. The OECD is not the only body to state that Canada's current passport system works well. The World Bank says that the system currently in place in Canada and in Quebec is efficient and effective. That is why we are opposed to the Conservative government's bill.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:10 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, it is very clear that the federal government is simply taking advantage of the economic crisis to push this argument. We all know that the idea of a national securities regulator has been around since 1935 with the royal commission. That was some 75 years ago. It has been discussed. There was a five-year study done in 1973. In 1988 there were more initiatives in this area and then again in the mid-1990s. There is nothing new here.

The fact is the passport system, which many members have spoken about, only came into effect in 2006. Manitoba joined the passport system in 2006. It has been mentioned many times that the passport system works very well in this regard. The Manitoba government is 100% in favour of it. However, the Manitoba government has been dead set against the idea of getting involved with a national securities regulator for about 10 or 15 years now.

This is not only a Quebec issue; it is a Manitoba issue and an Alberta issue. In fact, last week, some major corporate executives in Alberta came out strongly against this idea because there would be job losses in Alberta. For those members of the Conservative Alberta caucus, who are looking over their backs at the wild rose chasing after them, they ought to pay some more attention to this. A lot of business people in Alberta are not supportive of what the government is doing. The government is gradually losing touch with the voters who it claims to be representing.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:15 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Madam Speaker, I want to thank the hon. member for his question.

He is right to say that the Conservative government is taking advantage of the economic crisis to push this plan to interfere in the jurisdictions of the provinces and Quebec, as a number of previous governments have done before it. We are in fact going through an economic crisis. It seems to me that the government should think about that before investing $150 million.

I also want to thank the hon. member for mentioning that it is not just Quebec that is opposed to the federal government's intentions and its bill. That is something worth thinking about. I think the Conservative government should give this more thought. The Liberal members should also give this some more thought. In Quebec, we are against the bill because this aspect of the economy is a responsibility of Quebec and the provinces.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:15 p.m.

Conservative

James Rajotte Conservative Edmonton—Leduc, AB

Madam Speaker, it is a pleasure to stand today with yet another chance to debate another Bloc opposition day on securities regulation in Canada, a topic I very much enjoy debating. This is either the fifth or sixth such opposition day that the Bloc has introduced on the exact same subject. We are hearing some of the same arguments, but it is always worth visiting these issues again.

I would like to address my comments to a particular aspect of this debate that members have referred to and focus especially on my home province of Alberta. However, before I do, I would like to briefly address two items.

First, in my capacity as chair of the finance committee, I would like to note for the benefit of the House that the finance committee has endorsed a national regulator on numerous occasions, most recently in its prebudget consultation tabled last December in which the committee again recommended that the government should continue to move forward on a national securities regulator.

Second, I would like to take to task, frankly, the Bloc and other opponents of a national securities regulator for repeatedly attempting to suggest that both the IMF and the OECD believe Canada's security system is without flaw. This is clearly not supported by fact and in the spirit of fair and reasoned debate among learned individuals, we should not allow this to continue.

Both the IMF and the OECD have been crystal clear that the lack of a national regulator is a key and significant flaw in the Canadian financial system. The OECD has said:

The current diversity of regulations, for example, each province has its own securities regulator, makes it difficult to maximize efficiency, and increases the risk that firms will choose to issue securities in other countries. A single regulator would eliminate the inefficiencies created by the limited enforcement authority of individual provincial agencies.

The IMF sounded a very similar warning when it said:

A federal regulator could coordinate more readily with other regulators in monitoring risks and responding quickly to a crisis, and could also have an enhanced focus on the issues that securities markets may pose for national financial stability.

Neither statement is open to interpretation. Both the IMF and the OECD clearly support a national regulator. What is more, both of these organizations are not alone. Countless groups in Canada and beyond have joined their call. While the list is too long to mention, I will note a few.

The list includes everyone from victims groups like the Earl Jones Victims Organizing Committee, unions like the National Union of Public and General Employees, financial service groups like the Canadian Bankers Association, nearly every major newspaper editorial board in the country, investor groups like the Canadian Foundation for the Advancement of Investor Rights, retiree groups like the Canadian Association of Retired Teachers, pension plans like the Municipal Pension Board of Trustees, and the list goes on and on.

However, as impressive as the list of supporters is, it unfortunately has not yet swayed opponents of a national regulator. Unfortunately, one of those opponents is the government of my home province of Alberta, which is what I want to focus on in the rest of my remarks.

I underline that the government of Alberta is in opposition and, I emphasize, not necessarily the people or businesses of the province. In fact, even my friend, Alberta finance minister Ted Morton, was recently forced to concede that Albertans were not of one mind on this issue.

I would further note that a recent Canada West Foundation survey of 300 economists and financial analysts in the four western Canadian provinces found nearly 70% support for a national securities regulator, including a solid majority of 68% support in Alberta. As Canada West Foundation policy analyst Dan Gibbins noted, “From an economic perspective, it is still seen as a positive -- even in Alberta”.

Moreover, many prominent Alberta leaders or public interest groups have spoken out in support of a national securities regulator. I think I should recognize the efforts by Hal Kvisle with TransCanada, who was with the Hockin panel that did an awful lot of work in terms of producing a report that spurred the government to act in this manner.

I would also like to point out other people. For instance, Heather Douglas, president and CEO of the Calgary Chamber of Commerce, has strongly registered her support for the initiative. She stated:

—our member companies continued to express a great deal of frustration with the multiple regulators' insufficient enforcement, lack of technical expertise, conflicting regulations, and high costs to raise money on Canada's multiple stock markets. The Chamber calls on the provincial government still opposed to a sole regulator to reconsider their stance. Our startup member companies need capital to take their innovative goods and services to the marketplace. Our profitable businesses will be choked if they continue to waste investor money complying with conflicting legislative demands.

The Prospectors and Developers Association of Canada has also recognized the “urgent need for a common securities regulator and for proportionate-based regulation”. It has also noted that “giant sized rules for junior companies create poor conditions for companies that help open up economic opportunities, particularly for communities in Canada's northern and more remote regions”.

I would like to quote another friend and someone who played an instrumental role in getting Alberta back on a fiscal track, perhaps the person who did so more than any other, former Alberta treasurer Jim Dinning, who wrote an excellent article recently on a national regulator. He declared:

We need our financial regulators to better monitor these peril-creating events and act quickly to protect Canadians and their marketplace. But a system of 13 securities regulators can't keep up; it's almost built to frustrate effective action....[W]e need a regulatory framework that can speed up reforms required by structural changes coming at us, largely from rapidly evolving technologies. The existing system is not designed to accommodate that, lacking both co-ordination and depth of expertise.

I encourage members on both sides of the House to read the full article by Jim Dinning, the former treasurer of Alberta. It is an excellent argument in favour of a national regulator. I would also like to quote from newspaper editorials.

A recent Edmonton Journal editorial stated:

We remain the only country in the developed world to lack a national regulator of financial markets....Let's get on with having a common regulator, like adults elsewhere.

A Calgary Herald editorial was quite forceful in stating:

A single regulator should lead to a smaller, simpler, less costly and more efficient system, making it easier and cheaper for companies to raise capital....Today, Canada is the only developed country in the world without a single regulator, much to our competitive disadvantage globally.

The irony is that Alberta companies have long left that territorial mentality behind. Like TransCanada, Alberta has no business being a holdout. However, while noting the many supporters of a national regulator in Alberta, I concede that, like Quebec, some have remained skeptical and opposed. I would further suggest that most of that opposition is based on fears that a national regulator will not recognize the unique characteristics of regional markets and a legitimate interest in promoting vibrant local markets. That is why I want to address some of these concerns.

I strongly suggest and will outline why what is being proposed by our Conservative government actually dispels those fears by acknowledging the importance of regional input and by prompting strong local markets. Again, to quote former Alberta treasurer Jim Dinning:

This is a national regulator that's being proposed, not a federal regulator. The DNA of provincial and regional markets must be integrated into the decision-making process, right from the outset.

First and foremost, our Conservative government when developing the securities act, did not do so unilaterally in Ottawa. This was not a made in Ottawa top-down exercise. We invited all willing provinces to the table. We set up a transition office which was not headed by, as the Bloc will often point out, someone from Toronto. This was headed by the chair of the British Columbia Securities Commission. In fact, I want to thank Douglas Hyndman for all his excellent work to date. This is what he did. He made an effort to work with the provinces to get the federal government and the 10 provinces and territories to work collaboratively on this initiative.

As one participating province, through the head of the Saskatchewan Financial Services Commission recently confirmed, “We've enjoyed some pretty good dialogue with the Canadian Securities Transition Office on the development of the act”.

Indeed the proposed Canadian securities act goes to great effort to stress that. To start, it would not force any province or territory to participate in a Canadian securities regulator. It would be strictly voluntary. Provinces and territories would have the complete freedom to opt in or not.

What is more, far from being an intrusion into provincial jurisdiction, it actually respects constitutional jurisdiction, regional interests and local expertise. For instance, the proposed act would establish a federal-provincial-territorial council of ministers consisting of the minister of finance and other members appointed by and representing each participating province and territory. The council would have a statutory mandate to facilitate consultations and the exchange of information with respect to the administration of the act and securities regulation policy in general.

In addition, the council of ministers would advise on appointments of the board chair and members and other members of the Canadian securities tribunal. The council of ministers would also be directly involved in the development of regulations and policies.

To further understand that to be effective the national regulator will fundamentally require the support and expertise of the best talent in Canada's financial markets from across the country. Likewise, we recognize that local offices and staffing were areas of particular interest to all provinces. Accordingly, we committed that local offices will remain in place and that all current staff in the provinces and territories will be offered jobs with the new regulator to ensure that that expertise stays in the local markets.

This will permit the new regulator to build on that existing infrastructure and the expertise of participating provincial and territorial securities regulators.

What is more, we additionally committed to ensuring that local offices have the authority they need to make the regulatory decisions that they should. This is in keeping with the proposed act which charts an organization with comprehensive national standards made up of strong local offices with both an understanding of regional economies and that have the confidence of local businesses.

Finally, to respect our provincial and territorial partners to the fullest extent, we also referred the proposed act to the Supreme Court of Canada to obtain an opinion on whether it is within the legislative authority of Parliament before proceeding further. This will clear the air, we will get direction from the highest court in the land and it will provide certainty for all concerned provinces and territories, market participants and individual investors.

Benoit Pelletier, the former Quebec intergovernmental affairs minister in the Charest government himself has admitted, “The fact that the federal government decided to ask the court for an opinion in my view is something that is fair”.

Clearly and without a doubt our Conservative government is working and is committed to keep on working collaboratively with willing provinces and territories to establish a national regulator that is responsive to the distinct needs of regionally based sectors and market participants. We also continue to invite all other provincial partners, including Alberta, Quebec and Manitoba, to participate in the process, even if it is in an exploratory manner.

Charlie Spiring, CEO and founder of Wellington West Holdings, Inc., yet another western Canadian supporter of a national regulator lamented Manitoba's non-participation recently by stating, “Coming to the table now doesn't mean you are committed to it. It just means you want to be at the table when they are making the cake”.

Before concluding, I would like to briefly address the issue of the passport system. Some have suggested a national regulator is not necessary because the provinces have already adopted a passport system to regulate securities. However, we have heard time and time again that that does not go far enough.

With the passport system, Canada would still have 13 securities regulators, 13 sets of laws, however harmonized, and 13 sets of fees. As Ian Lee from the Sprott School of Business at Carleton University has noted, “This is still an unnecessary frivolous duplication of expenditures as companies have to pay extra fees and go through extra paperwork to complete the process”.

Or as the Saskatoon Star-Phoenix editorial has pointed out about the passport system:

...that piecemeal approach doesn't begin to address the kind of concerns raised by the IMF, reduce duplication, confusion, red tape or costs for investors or offer the centralized oversight and rules enforcement a single regulator provides.

I believe that not only should we reject today's opposition motion but that provinces like Quebec, Alberta and Manitoba should reconsider their opposition and should work as partners with the federal government on this very important initiative going forward.

Our Conservative government's plan to create a national Canadian securities regulator is long overdue. It represents a common sense approach with principles of clear accountability that will reduce overlap and duplication, strengthen enforcement and more. We can no longer accept the current system. We owe Canadians better.

Use of Camera in ChamberPoints of OrderGovernment orders

1:30 p.m.

Conservative

Terence Young Conservative Oakville, ON

Madam Speaker, I rise on a point of order.

Last evening at the moment of the unanimous passing at third reading of Bill C-475, the private member's bill initiated by the member for West Vancouver—Sunshine Coast—Sea to Sky Country, a bill which will significantly help police and our courts protect Canada's young people from the dangers of street drugs and notably methamphetamines, in this wonderful moment for Canada, I inadvertently broke a rule of the House in taking the member's picture as members of the House congratulated him. This was to present to him at a later date, perhaps at his retirement 20 years from now.

The Conservative members, including myself, are so proud to have him as a member of our caucus, a member who dedicated himself to this cause.

I note that in the last six months there have been two important occasions when many members took pictures in the House, first, when the Olympic athletes visited with the flame in December, and more recently when they visited the House again.

As well, I thought the House was adjourned at the time.

Nevertheless, I accept the point of order and I apologize for my inadvertent breach.

Use of Camera in ChamberPoints of OrderGovernment orders

1:30 p.m.

NDP

The Acting Speaker NDP Denise Savoie

I understand a point of order was raised last night and I believe that addresses the issue.

The House resumed consideration of the motion.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:30 p.m.

Bloc

Christian Ouellet Bloc Brome—Missisquoi, QC

Madam Speaker, the member for Edmonton—Leduc asked the member for Chicoutimi—Le Fjord a question a few minutes ago. He is not listening to me now, but I would still like an answer to my question. He asked why Quebec did not agree that there should be one commission in Toronto for all of Canada. His question was relatively simple.

Is he aware that in Quebec there are 14 statutes at present that protect our commission? It goes back to 1867, and it is under our jurisdiction.

If there were to be one commission in Canada and the Americans in Chicago asked Canadians why they didn’t join with them, what would the member for Edmonton—Leduc say to that?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:30 p.m.

Conservative

James Rajotte Conservative Edmonton—Leduc, AB

Madam Speaker, I never said why one securities commission would be in Toronto. It has not been decided. Obviously, the legislation has not even been introduced. However, it is not certain that the national commission would be in Toronto. There are other options. I would encourage the member to have Quebec participate and fight for Montreal to be the centre. I would fight for somewhere in Alberta, or perhaps in Ottawa, wherever.

We have said with our proposal that we would keep the expertise in the local offices. One of the concerns from Alberta is the issue of junior capital pools. They want to keep that local expertise in Alberta because they feel that people in other regions do not understand that expertise, so the proposal that we are putting forward, if the members are actually interested in it, is that we keep that local expertise there and we would rely on that.

The concern here is that we are the only nation of the G7 that has a security system with 13 different regulators. The intent is to have a uniform system across the country for better enforcement, for better protection of market participants, and for better protection of investors so that we can have one uniform system.

In terms of whether we should have one between Canada and U.S., I would still fight for a Canadian securities regulator and it would be up to Parliament, if it adopted the Canadian securities regulator, to protect and ensure it remained in place.

This is the one area of our financial regulatory system, in my view, that is not up to the level it should be. Every other area of our financial regulatory system, in my view, is tops in the world, but this is the one area that does need to be improved. The member just has to read the reports from the IMF and the OECD, including the most recent reports, to recognize that Canada should follow this path.

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:35 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, I would like to know what the member would have to say to his very own Conservative senator from Alberta who is leading the charge against the national securities regulator, and who points out that over time, there will be a job loss in Alberta, and that a national securities regulator will not be sensitive to the financial community as it exists in Alberta right now and where it plans to go.

This is a question that, over time, Alberta will lose jobs. We know that this will be headquartered in Toronto. Everybody knows that. The fact that the Conservatives say they have not decided yet is just a big joke. We know that is where it will be headed and over time those jobs will move from Montreal, from Edmonton, from Winnipeg, and will be concentrated in Toronto.

What would he say to the people in Alberta about that?

Opposition Motion—Securities RegulationBusiness of SupplyGovernment orders

1:35 p.m.

Conservative

James Rajotte Conservative Edmonton—Leduc, AB

Madam Speaker, in fact, it does not have to be headquartered in Toronto. It is possible that we could have a system that could actually be headquartered in Ottawa with regional offices in Toronto, Montreal, Vancouver, Calgary, and Halifax. That is a very viable system.

If the member wants to get more information on this, he should talk to the chair of the body that has been overseeing this, Douglas Hyndman from British Columbia. He was initially an opponent of this proposal, but has come around and says that he wants to be a part of this. He wants to be at the table actually defining what this regulator could possibly look at. He wants to be defining the rules and regulations that would be in place across the country.

That is what provinces like Manitoba, Quebec and Alberta should do. They should state what their concerns are, bring forward their concerns, and see whether they can be accommodated within the legislation. Then they can choose whether or not they wish to participate. This is a voluntary system. If Manitoba chooses not to participate, that is up to the province of Manitoba.

The member talked about a Conservative senator who he did not name. I would just point to the former treasurer of Alberta, Jim Dinning, who spoke very forcefully in the Financial Post, May 27 of this year, saying that we need a national regulator, not a federal one. He wrote very eloquently in terms of why we do need a regulatory framework. He wrote:

But a system of 13 securities regulators can’t keep up; it’s almost built to frustrate effective action. Canada came through the past financial crisis in reasonably good shape. We may not be so fortunate next time. We need to streamline the structure to help make rapid decisions.

He went on to write:

Take for example, the regulatory response — or lack of one — to the six electronic alternative trading systems operating in Canadian equity markets for the past three years or so. These platforms have captured more than 30% of trading volume from the Toronto Stock Exchange. Yet regulators--