Mr. Speaker, I rise on a point of order regarding Bill C-377, An Act to amend the Income Tax Act (requirements for labour organizations), introduced by the hon. member for South Surrey—White Rock—Cloverdale.
The official opposition has not risen on a point of order on this bill until now. However, the question of new spending was raised during consideration of the bill in committee, and I now want to draw my colleagues' attention to this matter.
In my opinion, Bill C-377 contains provisions that will require new spending for purposes that are currently not authorized by the legislation, and it should therefore be accompanied by a royal recommendation. Under Standing Order 79, the House cannot pass an appropriation bill if it is not accompanied by a royal recommendation.
In House of Commons Procedure and Practice, Second Edition, which I read every night, O'Brien and Bosc state that two types of bills give Parliament spending authority and that they both must be accompanied by a royal recommendation. Bill C-377 is of the second type, namely “bills that authorize new charges for purposes not anticipated in the Estimates”. O'Brien and Bosc specify that the charge imposed must be “new and distinct”. In other words, it must not be covered elsewhere by some more general authorization.
Clause 1 of Bill C-377 states that:
...the information contained in the public information return referred to in subsection 149.01(2) shall be made available to the public by the Minister, including publication on the departmental Internet site in a format that allows for word searches to be performed and for cross-referencing of data.
These provisions require the expenditure of public funds in a manner and for purposes not currently authorized. That means that “new and distinct” funds must be authorized to give the Canada Revenue Agency the means to manage this work, which is also “new and distinct”. Even in the most recent supplementary estimates, which were tabled a few weeks ago, there is nothing about the costs related to the work required by this bill. There is nothing to show that, when the supplementary estimates were published, the Canada Revenue Agency had already planned for this bill to become a law.
By way of proof that these costs are new and unauthorized, it is important to note that the Canada Revenue Agency has never participated in the preparation of financial reports for unions or union-related organizations. Furthermore, before the Corporations and Labour Unions Returns Act was amended, it required unions to produce financial reports, but this directive was given to the Chief Statistician of Canada, not the Canada Revenue Agency. The Canada Revenue Agency has thus never been responsible for managing this type of process for the unions.
During the debate at second reading of Bill C-377, the bill's sponsor suggested that the provisions of the bill were similar to those that have been in place for charities since 1977. The information requested from charities is dealt with by the Canada Revenue Agency and has nothing to do with the information requested from unions in Bill C-377. It is not comparable.
The rules for charities require them to disclose much less information and require the agency to share a great deal less data. Yet, this program alone costs over $33 million a year and employs over 300 full-time workers. If Bill C-377 is passed, the Canada Revenue Agency will have to create a new branch that will make up a whole new complex layer of government bureaucracy. A new entity will have to be created to administer and enforce the provisions of this new bill.
Furthermore, the bill is written in such a way as to include all labour organizations and all labour trusts, or almost 25,000 filers in total. It is obvious that there will be costs associated with training labour officials who are unfamiliar with all the new forms and, more importantly, costs associated with processing these returns from the 25,000 filers. None of these costs are included in costs forecast by the Canada Revenue Agency. These are “new and distinct” costs, the condition for a royal recommendation for a bill, as I mentioned earlier when quoting O'Brien and Bosc.
It is definitely important to discuss the new costs that will be incurred by the Canada Revenue Agency as a result of Bill C-377, but it is equally important that we discuss the extent of these costs. In committee, Professor John Logan, of San Francisco State University, compared this bill to the Labor-Management Reporting and Disclosure Act, created in 1959 in the United States.
This law provides for a similar reporting system that requires labour organizations to produce annual financial reports for the U.S. Department of Labor. The requirements for the returns under Bill C-377 are more detailed and complex than those in the U.S. Labor-Management Reporting and Disclosure Act.
Thus, we can expect that Bill C-377 will result in the same ongoing costs as those incurred under the U.S. law, if not higher costs. For fiscal 2011, the U.S. Office of Labor-Management Standards received reports from almost 25,000 U.S. labour organizations—about the same as in Canada—with a budget of $41.3 million.
Finally, the provision of Bill C-377 requiring the minister to make the information collected available to the public will also give rise to new expenditures. The departmental Internet site does not presently allow for cross-referencing of data, which is required by clause 1 of the bill. The government will therefore have to invest in an expensive computer system that can handle tens of thousands of separate returns covering thousands of distinct transactions.
For all of these reasons, it is clear that the provisions in Bill C-377 require the unauthorized spending of public money for unauthorized purposes and that the bill must therefore have a royal recommendation.
Mr. Speaker, to make it easier for you to examine this important issue, I will provide the testimony given during the Standing Committee on Finance's study of Bill C-377. I want to point out that the Canada Revenue Agency received an order from the Standing Committee on Finance to answer questions regarding new and distinct funds. I strongly believe that its answers will prove beyond doubt that Bill C-377 requires a royal recommendation. I will send you those responses as soon as they are available.
By putting this bill in the hands of the backbench member for South Surrey—White Rock—Cloverdale, the government is shirking its responsibility. So far, the government has done nothing but make a series of mistakes.
Mr. Speaker, you will recall that you have already had to withdraw one of this member's private member's bills from the order paper in response to a convincing point of order from the official opposition last fall, with which you agreed.
In light of the testimony we heard in committee, there is little doubt that this bill absolutely requires a royal recommendation if it comes back to the House for a vote at third reading.
I think that the government must either admit that this bill flagrantly undermines Canadian workers across the country or throw it in the legislative garbage can, where it belongs.