House of Commons Hansard #143 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was conservative.


Competition Act
Private Members' Business

6:35 p.m.


The Deputy Speaker Andrew Scheer

Order, please. I understand the hon. member for Churchill is rising on a question of privilege.

Sit-in at Hill Office of Indian Affairs Minister
Private Members' Business

6:35 p.m.


Niki Ashton Churchill, MB

Mr. Speaker, I would like to respond to a question of privilege that was raised earlier.

Yesterday, I accompanied the delegation of the Sayisi Dene elders and leaders, who are from Tadoule Lake in northern Manitoba.

The Sayisi Dene have a long-standing claim, based on a forced relocation imposed by the Government of Canada in 1956, a claim that is one of the few imposed based on a forced relocation of aboriginal people that has yet to be resolved.

The Sayisi Dene, who are my constituents, wanted to ask for a meeting with the Minister of Indian and Northern Affairs, a meeting for which they have asked for quite some time. I helped my constituents in requesting this very meeting. There was no intention to obstruct any work being done. This was not an orchestrated event and to characterize it as such would be incorrect.

I would like to note that the elders were offered to sit in the office, while a response could be given. As the MP, I asked for the meeting and listened to the request of these elders. I then stepped out of the office, shortly after which the chief of staff arrived and offered to meet with myself, the lawyer for the Sayisi Dene and the chief of the Sayisi Dene. We met. Then we returned to the delegation, where the chief of staff committed to a meeting between the minister and the delegation in the near future.

Security were there, outside of the office, reports were filed and I would encourage the Speaker to examine all such security reports.

I would like to point out that the tone of the exchange was respectful throughout. Not only that, but the exchange ended with handshakes and on a respectful note. There seemed to be a clear understanding of the gravity of the situation facing the Sayisi Dene, a people who have suffered immeasurably as a result of the forced relocation imposed by the Government of Canada in 1956.

I would also like to respond to the reference to my meeting with the minister. I would like to clarify for the record that I had been requesting a meeting with him for about three months.

I go back to yesterday. I would like to note and emphasize that the tone throughout was one of utmost respect, a reference that was reiterated by the elders who led this delegation.

Finally, it ended with the meeting being committed to, a commitment made by the chief of staff representing the minister.

I hope the minister will meet with the chief and the elders of the Sayisi Dene at the nearest opportunity. After all, that is what they have asked for. It has been a long time that the Sayisi Dene people have been waiting and, with respect, offering at every step of the way to work with the Government of Canada to begin their journey and our journey of reconciliation.

Sit-in at Hill Office of Indian Affairs Minister
Private Members' Business

6:40 p.m.


The Deputy Speaker Andrew Scheer

I thank the hon. member for that statement. I am sure the Speaker will come back to the House with a decision on this matter in due course.

The House resumed consideration of the motion that Bill C-452, An Act to amend the Competition Act (inquiry into industry sector), be read the third time and passed.

Competition Act
Private Members' Business

6:40 p.m.


Glenn Thibeault Sudbury, ON

Mr. Speaker, I am very pleased to speak to Bill C-452, An Act to amend the Competition Act (inquiry into industry sector).

I commend my colleague, the member for Shefford, for bringing forward such an important amendment to the Competition Act. I am happy to say that the New Democratic Party will be supporting this vital legislative initiative.

In essence, this bill seeks to change the current law, which says the Commissioner of Competition can only launch an investigation when there is a concern about one or more market participants. While the bill appears to have originally been tabled to deal with the retail gasoline sector, the broad amendment makes the proposed legislation applicable for all industry sectors, including communications industries.

This is particularly important at this time, as the banking disputes over competition have been increasing over the past few months, whether it is in relation to the oil and gas sector where consumers are being gouged at the pumps by abusive practices which hurt the wallets of ordinary working and middle-class Canadians, or some other issue.

I heard my hon. colleague from Winnipeg North talk about the gas prices in his riding. I believe he said it cost $1.20 a litre. In Sudbury right now it is close to $1.30. My colleague from Algoma—Manitoulin—Kapuskasing said the price in Wawa and Elliot Lake is $1.30 in some cases.

The dispute over usage-based billing demonstrates that we need this tool to widen the scope to encapsulate not just the oil and gas sector, which we are talking about, but other major sectors of our economy as well.

In the oil and gas sector there is clearly a lack of refining capacity in Canada. Coupled with vertical integration, this basically leads to a formula that is a recipe for disaster for Canadians and their pocketbooks.

It is interesting that when the government lowered the GST with regard to oil and gas, the companies did not pass the reduction on to consumers. Prices and profits have risen significantly and not even one single organization or company has taken advantage of the opportunity to pass the 2¢ reduction on to consumers. The companies took it and put it in their own pockets. That is shameful. More important, that 2% has a large impact on working and middle-class families who are being financially squeezed during tough economic times.

Therefore, it is only fair that we examine the bill and look at the oil and gas sector as one of the variables in how it can be addressed because the bill is specifically geared to the industry sector, which is a responsible way to approach it. It allows targeting to certain areas where there is a lot of interest.

In terms of the telecommunications sector, we have the entrance of new players into the Canadian market with regard to telecom and that means more communication devices, cellphones, BlackBerrys, iPhones, and wireless service providers that are being expanded in Canada. There are those who feel there is no competition in that sector and relatively similar pricing that makes it very difficult for consumers to get a better benefit. These companies have also been receiving record profits and are quite lucrative. Almost all of the groups and organizations of the big telecommunication companies have done extremely well.

Both the current CRTC chair, and Sheridan Scott, the former commissioner, have advocated for the authority to conduct market studies during their tenures as the head of the bureau. This amendment to the Competition Act is therefore obviously something which the regulators of our telecom sector deem necessary for bringing Canada's telecommunications regime into the 21st century. We have seen there are flaws in this regime and this bill is an important step in redressing these shortcomings.

Another issue raised often with regard to this issue is credit cards, something I have been talking about quite often. New Democrats have been calling for a number of credit card reforms. I have been pushing this issue to the forefront. The Minister of Finance is in favour of a voluntary agreement. It is clear that we have deficient credit card competition in Canada. There are some groups and organizations that are more progressive, but at the same time it is seen basically as a system that is stuck where the vast majority of credit cards have interest rates that are quite similar.

This voluntary code is not sufficient. We need something with the necessary teeth to oversee the credit card industry. I feel this amendment would provide an extra layer of protection for ordinary Canadian consumers, as well as small and independent businesses which are routinely encountering major issues with the predatory practices which are being employed by credit card providers. This is an area where we need to see more healthy competition, but we have not.

The banks are also making record profits, and we have seen the same things there. My office receives complaints with regard to how close bank fees are among different organizations. There does not actually have to be collusion where there are brown envelopes changing hands and information being wired back and forth to predetermine the actual cost of items and passing it on to consumers. There just has to be a general acknowledgement that they will stay in a certain field of play and compete in that field of play. That is not real competition.

Small and independent retailers are facing a similar dilemma in regard to the anti-competitive practices. The big issue for retailers is the influx of premium cards, for instance, and those that offer generous air miles. Consumers are lured to those cards because they offer a chance to collect points faster and reap the rewards such as free flights, electronics and jewellery. The use of these premium cards has risen dramatically since they first hit the market in 2008. That high end plastic, such as the Visa Infinite or the World Elite MasterCard, cost more for retailers to process than other standard gold or platinum cards.

Consumers do not know that their demand for those freebies from the credit card companies is actually squeezing profits from these small businesses, because it is the merchants who really foot this bill. Ordinarily the cost per transaction ranges from 1% to 3% of every sale, whether the customer pays cash or pulls out a card. Premium cards require much more than that, considering the razor-thin margins the competitive market demands, and $5 billion is a lot.

Family debt is on the rise. The debt carried by the average Canadian household has hit $100,000, up about 78% from two decades ago. The debt to income ratio stands at a record 150%, meaning for every $1,000 after tax income, Canadian families owe an average of $1,500.

In summary, Canadian families cannot wait much longer. They are being gouged because of anti-competitive practices in every facet of their lives, be it gas, cellphones, the Internet and their credit card bills.

Bill C-452 is a very, very important first step in curtailing these abusive practices, and I call on all members of the House to support my colleague's bill.

Competition Act
Private Members' Business

6:50 p.m.


France Bonsant Compton—Stanstead, QC

Mr. Speaker, I am pleased to speak today in the House on Bill C-452, An Act to amend the Competition Act (inquiry into industry sector) introduced by my colleague from Shefford.

Bill C-452 proposes to amend the Competition Act to give more power to the Competition Bureau. I would like to start by congratulating my colleague for this fine and very important private member’s bill. I think this is a subject that is dear to his heart and I want to salute the quality of the work he has done.

The amendment proposed by my colleague from Shefford will allow the Commissioner of Competition to initiate inquiries of his own accord into fluctuations in the price of gasoline, if there are reasonable grounds for doing so. It will therefore no longer be necessary to wait for complaints to be filed before making an inquiry. If this bill is enacted, the Competition Bureau will be better equipped to combat companies that might profit from their dominant market position to pick consumers’ pockets.

Every time gas prices rise, the governments hands us the same answer: nothing can be done, the Competition Bureau has concluded there was no agreement among the oil companies to fix prices. The truth is that there are a number of flaws in the present act. It does not allow the Competition Bureau to initiate inquiries. And when there is an inquiry, the Competition Bureau cannot really do anything with them because at present it cannot compel the production of documents or protect witnesses. Bill C-452 would eliminate these flaws by allowing the Bureau to initiate inquiries and allowing the federal Trade Tribunal to protect witnesses and seize relevant documents.

If the act is not amended, gas prices will continue to fluctuate with no justification, as is the case at present. And it will again, and still, be consumers who will continue to pay for the more dubious practices on the part of the oil companies.

Gas prices fluctuating is one thing. It is another thing when they rise stealthily and without justification. Recently, prices at the pump rose because of the political instability in north Africa. In just a few hours, prices rose spectacularly. That is completely bizarre, when we know that the events that occurred in north Africa had at that point not yet had any impact on the cost of refined gasoline that was already in Quebec. That practice is nothing more nor less than a way of making even more money on the backs of consumers, and there is a lot. It is estimated that because of collusion, retailers have overcharged Quebec consumers by as much as $100 million.

The Bloc Québécois recently supported Bill C-14, An Act to amend the Electricity and Gas Inspection Act and the Weights and Measures Act, to fix price errors at the pump. But that bill does not solve the problems of collusion like the ones recently disclosed in Quebec and does not prevent sudden increases in the price of gas. The Conservative government claims that its initiative will save the public a lot of money. Gas consumption in Canada, calculated over a full year, is so high that it is completely foolish to think that bill can have any impact on consumers’ wallets. That is why we in the Bloc Québécois believe that in order to respond effectively to gas price increases, Bill C-452 must be enacted. This bill is the only thing that will have a real impact on prices at the pump.

For years, the Bloc Québécois has been pressuring the federal government to finally take action to address the rising cost of petroleum products. It has dogged the Liberal government of the day so that it would follow up on the recommendations made in 2003 by the Standing Committee on Industry, Science and Technology. In October 2005, just before the election, the federal government finally listened to the Bloc Québécois' arguments and decided to amend the Competition Act through Bill C-19. That legislation broadened the Competition Bureau's authority to investigate and increased the maximum penalty for conspiracy. However, Bill C-19 did not follow up on all the committee's recommendations. As we know, that legislation, which was only an election ploy, died on the order paper with the election call, and we certainly could not count on the Conservative government to bring it back.

In 2007, the Bloc Québécois introduced Bill C-454, which also died on the order paper, when the election of 2008 was called.

In 2009, the Conservatives took part of the bill and included it in the budget implementation act. However, they did not see fit to allow the Competition Bureau to initiate investigations. That is why the hon. member for Shefford came back again with Bill C-452. The recent years clearly show that neither the Conservatives, nor the Liberals acted to protect consumers. By contrast, the Bloc Québécois is taking action.

For the Bloc Québécois, the only effective way to deal with the rising cost of gas is to use a global strategy. That strategy is three-pronged: to bring the industry into line, to make it contribute, and to reduce our dependency on oil.

First, we must bring the oil industry into line. The initiative of my colleague for Shefford supports that approach. It is also necessary to set up a true monitoring agency for the oil sector.

Second, the oil industry must make a contribution. With the increase of costs and oil company profits, it is important that the latter pay their fair share of taxes. How can we accept that consumers are getting poorer, while oil companies are getting richer?

Despite the recent recession and despite the rise in the price of gas, oil companies are posting record sales. In 1995, the Canadian oil and gas sector posted combined sales of $25 billion. By 2008, this figure had climbed to $148 billion. That is an increase of nearly 600%.

Now let us talk about profits. In 2003, Canada's oil sector made $17.6 billion in profits. In 2008, it made $79 billion. In other words, the net profits of Canada's oil sector more than quadrupled in just five years. The Bloc members feel that the party must end for the oil companies.

But obviously the Conservatives do not feel that way. In 2003, they supported the Liberal government's move to reduce the overall tax rate for oil companies from 28% to 21%. With the changes brought in by the Liberals, supported by the Conservatives, taxes for Canada's oil sector became more advantageous than in Texas.

But that is not enough. In 2007, in their economic statement, the Conservatives introduced tax cuts for oil companies that would see their tax rates drop to 15% in 2012. These tax cuts will enable the oil companies to pocket approximately $3.6 billion in 2012. These figures make it clear that the federal government chooses to give priority to the interests of the oil companies, at the expense of consumers.

I do not know how the Conservative members justify this to their constituents, but I know that when I meet my constituents from Compton—Stanstead, not a single one tells me that the gifts to the oil companies are justified. On the contrary, the people I meet feel cheated by this Conservative government, a government that is in league with an industry that exploits consumers' dependence on oil.

The third component of the approach proposed by the Bloc Québécois has to do with reducing consumers' dependence on oil. This makes sense and it is perfectly in line with Quebec's efforts to fight global warming. The less gas that we consume, the less money the industry will pocket and the better off our planet will be.

Competition Act
Private Members' Business

6:55 p.m.


The Deputy Speaker Andrew Scheer

The time provided for the consideration of private members' business has now expired, and the order is dropped to the bottom of the order of precedence on the order paper.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

7 p.m.


Carol Hughes Algoma—Manitoulin—Kapuskasing, ON

Mr. Speaker, I am glad to have this chance to revisit the issue of offshore tax havens and put a little more meat on the bones of this topic than we get a chance to do in question period.

Tax havens are nothing new. They are a phenomenon that dates back to the 1960s. Given our financial challenges and the spending we have incurred in order to stimulate our economy, it is galling that people will go out of their way to hide money from Revenue Canada. It is estimated that offshore tax havens siphon $500 billion away from the tax man every year around the world. Places like the Cayman Islands, the Bahamas, Bermuda, Panama, the Channel Islands, Monaco, Luxembourg, Lichtenstein, Singapore and Switzerland provide banking beyond the reach of institutions like Canada Revenue. We can see that it is not a phenomenon unique to Canada, but that does not mean we should condone or accept it either.

New Democrats have long been critical of the Canadian government's seeming indifference to tax cheats who use offshore tax havens to bleed our economy for their own benefit. We see how small tax offences are prosecuted thoroughly, and these bigger and more egregious offences are largely left alone. I have joined other New Democrats in asking a number of questions on the subject this year.

In September, my leader pointed out that the top five Canadian banks use tax havens to avoid paying $16 billion in income tax. Sadly, and far too often, we receive dismissive answers from the government and promotion of their incomplete efforts on the issue, rather than an admission that there is so much more to do with respect to battling this white collar crime, which is exactly what it is. It is a crime perpetrated on all Canadians, and the only reason it persists is the lack of political will to do anything about it. It is clear that the government is not even aware of the scope of the problem. If it is, it is not telling Canadians about it. This is despite the examples of some of our closest trading partners. The United States, Mexico and even Britain can be cited as countries that are showing their citizens that they are serious about combatting this type of tax evasion.

We speak at length about transparency, and although it is clear that the government has difficulty with transparency, it actually has a chance to do something about it. We hear the minister bragging about locating more money offshore than the Liberals did when they were in power but we do not hear him bragging about the increased government attempts to locate tax cheats. That is because it is not doing much. We do have a voluntary disclosure program that will tempt a few of the more honest tax cheats to volunteer their information. However, I would imagine that the WikiLeaks documents naming 2,000 individuals with Swiss bank accounts will scare more people into disclosure than any voluntary program the government has in place.

What makes matters worse is that we receive reports that the CRA is cutting back 200 investigators charged with looking into offshore accounts. How does this send a strong message to Canadians hiding money in offshore accounts? Where is the consistency? Why not add personnel to the unit that investigates these crimes, not reduce them?

For every dollar that we spend tracking down tax cheats, we recover five dollars. It is a no-brainer and really speaks to the government's priorities that it has not done this already. How is it that the government, which bills itself as tough on crime, will not roll up its sleeves and do the hard work now when the economy needs these funds the most?

7 p.m.



Cathy McLeod Parliamentary Secretary to the Minister of National Revenue

Mr. Speaker, I am delighted to stand today as it is my first time in the late show as the Parliamentary Secretary to the Minister of National Revenue, but, more important, to negate some of the inaccuracies in terms of what my colleague just stated.

I am pleased to share with her that the finance committee did a non-partisan study, which we all had the opportunity to enjoy, as all of the members are very concerned about the issues of tax havens. What we are finding out is that phenomenal progress has been made, especially in the last five years. Therefore, to say that nothing has been done is absolutely inaccurate. We have had many witnesses come and talk about the phenomenal progress that has occurred in the last five years.

What we learned in the committee is that it is very important to look at tax avoidance and tax evasion in two very different lights. We must also recognize that there are companies in Canada that do legitimate business offshore and we should not be painting everything with the same brush. No one is saying that we should not be doing legitimate business offshore. Everyone believes that tax evasion is wrong and we need to bring in the full power of the law.

Again, committee members have been learning very interesting things. I would like to quote from Jeffrey Owens of the OECD who said:

The other thing that's important is the deterrence effect. I talk to a lot of business people, financial advisers, and investment banks, and the one thing that clearly has changed here is that if they get a Canadian client who comes to them and says, “Look, I want to evade taxes; perhaps I could use Barbados or somewhere else”, they'll say, “Forget it. Those days are gone.” There's been a change in attitude on the part of the business community, and that should not be underestimated.

One would expect that this recognition of change in attitude of the Canadian investment advisors is, in large measure, due to actions undertaken by the Prime Minister and the current Conservative government. Among these, Canada has been a world leader in battling this global program.

The CRA is a member of many international organizations and forums that work together to counter aggressive international tax planning. These include: the OECD Working Party on exchange on information and tax compliance; the global forum on transparency and exchange of information; the forum on tax administration; the Joint International Tax Shelter Information Centre; and, the Seven Country Working Group on Tax Havens.

Canada is one of 95 jurisdictions that have agreed to the international standard for exchange of information, including access to bank information.

Canada has an extensive network of tax treaties, one of the largest in the world, with 87 treaties in force.

The Finance Minister announced in the 2007 budget that all of Canada's new treaties and any revisions to existing treaties must include the new OECD standard for exchange of information. The 2007 budget also announced measures that would encourage jurisdictions to enter into tax information exchange agreements, TIEA, with Canada. The TIEA is a relatively new type of agreement used to exchange information in jurisdictions where there is little or no tax and a full tax, partly to prevent double taxation, is thus not required.

Currently we have 11 signed TIEA agreements and 14 in negotiations.

This is where there are a lot of inaccuracies in the members' statements. Since 2006, the number of full-time employees working in the CRA's aggressive tax planning program has doubled and the number of full-time employees working on international audits is up 44%.

An additional--

7:05 p.m.


The Deputy Speaker Andrew Scheer

Order, please. The hon. member for Algoma—Manitoulin—Kapuskasing.

7:05 p.m.


Carol Hughes Algoma—Manitoulin—Kapuskasing, ON

Mr. Speaker, I thank the Parliamentary Secretary to the Minister of National Revenue for her comments on this and her answers, but I was also at those meetings and there were concerns raised there.

There is no doubt that the government could and should be doing more and New Democrats have a plan that it can freely borrow if it wants to get serious about the issue. We proposed these actions in the autumn and the government still has not made use of these concrete suggestions.

First, we need to deal with transparency. We need to identify the current tax losses and assess their impact on federal and provincial treasuries. Without this basic information, Canadians will remain skeptical about any other initiatives we take on the issue.

Second, we need to beef up enforcement. We need to increase the Canada Revenue Agency's compliance resources to recover more lost revenue.

Finally, with respect to disclosure, we need to adopt regulations to shift the onus for revealing tax avoidance measures to the filer, as has been done in the United States.

Those are achievable measures that will go a long way to turning off the tap for--

7:05 p.m.


The Deputy Speaker Andrew Scheer

Order. The hon. Parliamentary Secretary to the Minister of National Revenue.

7:05 p.m.


Cathy McLeod Kamloops—Thompson—Cariboo, BC

Certainly, Mr. Speaker, aggressive international tax planning, including hiding income in offshore accounts, is a major concern for tax authorities worldwide. Our vast information exchange network allows Canada to be at the forefront when it comes to detecting and fighting all forms of international tax evasion and avoidance.

Our government's fundamental approach to tax administration has always been, and will continue to be, to encourage individuals and businesses to self-assess and pay their taxes responsibly. We deal harshly with those who attempt to avoid their legal responsibilities.

With respect to Canada's efforts, Mr. Dave Sohmer of Spiegel Sohmer remarked at the finance committee, “I think Canada has done a marvellous job in the international arena...Canada has played a significant role...”.

Finally, I note former Liberal cabinet minister and secretary general of the OECD, Donald Johnston, congratulated this Conservative government at the finance committee when he observed, “--the progress that has been made...over the last five really quite remarkable”.

7:10 p.m.


Richard Nadeau Gatineau, QC

Mr. Speaker, the Reform Conservatives now have control of the Senate. They are further sabotaging democracy by, among other things, obstructing the passing of Bill C-232, which simply asks that Supreme Court justices be bilingual.

The Bloc Québécois supports the principle of Bill C-232, which provides that Supreme Court judges should be bilingual and capable of hearing cases without the assistance of an interpreter. We are asking for this out of respect for Quebeckers, as well as all Acadians and all francophone Canadians. We are also doing so because the Official Languages Act provides that English and French have equality of status and use, and because the French and English versions of federal acts have equal value and one is not considered a translation of the other.

The right of any citizen to use French or English before Canada's courts is a fundamental linguistic right. The Official Languages Act already recognizes the importance of being understood without the assistance of an interpreter before federal tribunals such as the Tax Court of Canada, the Federal Court and the Federal Court of Appeal.

It is also because of the problems that come with simultaneous interpretation, which does not allow enough reaction time to interrupt and ask questions, for the judge, the lawyers or even the litigants, who have the right to grasp all the nuances and subtleties of each respective language.

With regard to the principle behind bilingual Supreme Court justices, it is important to note that on May 21, 2008, the members of the Quebec National Assembly unanimously passed the following motion:

That the National Assembly of Québec affirm that French language proficiency is a prerequisite and essential condition for the appointment of Supreme Court of Canada judges.

The Premier of Quebec, Jean Charest, said: “Knowledge of French is important, very important. It is not a choice. And the message we are sending today to the federal government is that it is not optional”.

To know a language is to know a culture, a reality. And those who are called on to interpret that reality and make decisions that will have a very important impact on our lives have to know that reality through our language.

That is what Premier Jean Charest of Quebec said.

The Premier of Quebec is also of the opinion that “open federalism must ensure that judges appointed to the Supreme Court by Ottawa know Canada's two official languages”.

The Standing Committee on Official Languages also looked at the issue of comprehension of the two official languages by Supreme Court judges. In its fourth report, tabled in May 2008, it “recommends that the government ensure that the judges that they appoint to the Supreme Court are bilingual”.