House of Commons Hansard #77 of the 41st Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was investment.

Topics

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:30 a.m.

Liberal

Geoff Regan Liberal Halifax West, NS

Madam Speaker, I commend the member for London—Fanshawe for bringing this issue before the House today. The motion is a good one. The principle behind it is well founded.

The Liberal Party is concerned about what has happened at Electro-Motive Diesel. This, as well as what has happened at Papier White Birch in Quebec City, has certainly been mentioned in question period in recent weeks.

When we think about the rules we should have in place on foreign ownership, it is incumbent upon us to think about what we might see in response from other countries as well as the value and importance of investment by Canadian companies overseas.

As the government wants to change the pension system in very negative ways, it seems that more and more it expects Canadians to rely on investments in private markets for their retirement income. In view of that, and of the fact that many Canadians do have investments, whether it be bonds or stocks in Canadian companies that invest elsewhere, how does the member see the importance of that kind of foreign investment from Canada?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:35 a.m.

NDP

Irene Mathyssen NDP London—Fanshawe, ON

Madam Speaker, I thank my colleague from the Liberal Party for his concern about Electro-Motive Diesel. I would encourage him to please urge his provincial counterparts in the Government of Ontario to stand behind these workers and make sure that labour laws and protections are fully supported by the Liberal government of Mr. McGuinty.

The member is quite right, we have to have balance in this country. Investment is an important part of that. When these investors come here, they benefit from the fact that we have a universal health care system, significant infrastructure and well-educated workers. They benefit from the roads, clean water and all of that. Therefore, they have an obligation when they come here because their investment is secured by what Canadian taxpayers have provided. They have an absolute obligation to provide assurances regarding the safety of that investment, of the jobs, and that they will be participating in the community for generations to come and not running away like Caterpillar did.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:35 a.m.

NDP

Raymond Côté NDP Beauport—Limoilou, QC

Madam Speaker, this morning I am honoured to speak to this motion and defend the interests of thousands of workers across Canada. We are not talking about just the workers at Electro-Motive in London and White Birch Paper in Quebec City. We are talking about the large number of workers and retirees who have been directly or indirectly affected by the government's wholesale, reprehensible desertion of their cause.

I would like to sincerely thank my colleague from London—Fanshawe for having moved this motion and for giving me the opportunity to share my thoughts about it on this opposition day.

I will concentrate on the situation in Quebec City, beginning with some background information. It is important to understand all of the ins and outs. What happened at the Stadacona plant in Quebec City had nothing to do with market forces, constraint, profitability issues or anything like that, and everything to do with a manoeuvre that, unfortunately, within the existing legal framework, enabled outright theft, and I am choosing my words carefully. For months, I have been talking to the workers, the union and retirees to gain an understanding of the situation. I have had access to privileged information, and what happened in Quebec City is a real scandal.

Not long ago, on January 11 in Quebec City, White Birch Paper management sent employees a final offer, an ultimatum actually, which a staggering 91% of the employees rejected. We must not forget that, in December, around the holidays, these offers were preceded by a separate offer sent to the Rivière-du-Loup and Masson-Angers plants, which 99% of the workers rejected. From the start, White Birch Paper management has been trying to divide and conquer so that it can exploit Canadian families, families in Quebec City and elsewhere in the province.

On January 12, following what appears to have been an unfounded lockout ordered on December 9, 2011, White Birch Paper announced the permanent closure of the Quebec City plant without giving any reasons for the closure. Management talked about profitability and the impossibility of continuing operations. Unfortunately, White Birch Paper is a privately owned corporation, so it is not transparent and does not disclose information about production, profitability and what was really going on in its three plants. White Birch Paper also has a plant in the United States, where it is facing legal action because of manoeuvres that are considered fraudulent under U.S. law.

In response to the permanent closure, the union prepared a plan, a list of offers to reopen negotiations with management. In the end, management agreed, albeit half-heartedly, and negotiations are currently under way. Although I do not want to assume anything, I think I can guess the outcome. Unfortunately, there is a good chance the workers will be cheated once again, but we must give the negotiations a chance. We have always defended this principle. We defended it last spring during the Canada Post dispute, which was an unjust lockout. Thus, we must give the negotiations a chance.

Another important deadline is February 17, when the parties are scheduled to go back to court, and we know that the company has been under CCAA protection for the past two years. Justice Robert Mongeon will decide what happens next. Justice Mongeon has been very patient and very conciliatory, I might add. He has granted several extensions to allow White Birch Paper to come up with a solution and reach an agreement with its workers. The management of White Birch Paper has therefore had plenty of opportunities to address the challenges presented by the company's so-called difficult situation.

From the information I have gleaned and the conversations I have had with various stakeholders, the reality is that the current owner, Peter Brant, is a social misfit, an enemy of society in general, especially in Canada. Those are the facts.

The first company on the list of creditors is Black Diamond Capital Management, which happens to be the company that would buy back White Birch Paper's assets. White Birch owes Black Diamond Capital Management $157 million. Peter Brant, the current owner of White Birch Paper, is also involved in Black Diamond Capital Management, so this whole affair is quite dubious. I have a serious problem with that.

I do not want to name all of the creditors on that list, but there are several all over the world, particularly in the United States, including Credit Suisse—which is owed $32 million—GE Capital, Merrill Lynch and Dune Capital. White Birch Paper owes tens of millions of dollars to a slew of creditors and investment funds.

What really happened? The hon. member for London—Fanshawe provided an accurate summary of the situation. Unfortunately, under the existing legislative framework, money can be stolen outright, and it is Canadian families who have to pay the price. We are talking about 600 families of workers and as many, if not more, families of pensioners, not to mention a number of company closures. This has an enormous impact. Hundreds of other indirect jobs will also be lost as a result of the closure of the plant in Quebec City alone, not to mention the two other plants in Rivière-du-Loup and Masson-Angers.

Looking at the existing situation, we wonder why the current government is acting as an accomplice in outright theft—theft that, unfortunately, is legal because the laws are not adequate. I will not mention our private member's bill on the Investment Canada Act since the hon. member for London—Fanshawe has already given a clear and brilliant speech on that. I spoke with representatives of the Regroupement des employés retraités White Birch-Stadacona. They were shocked and gave their unconditional support for our bill on the protection of pension plan funds in the case of bankruptcy. The lawyer for the pensioners' association said it best when he stated that this is the law Canada needs to solve the problem.

Our two bills—we are focusing on just these two—are important in order to maintain a balance in industrial labour relations and labour relations in general. At the same time, the government must take responsibility for its people and protect Canada's interests, which it is not doing. We have a legal framework, but it is not necessarily enforced. There are no constraints, as the Investment Canada Act currently demonstrates. The government can close its eyes and say that it is sorry, that it cannot help what is happening, and that it believes the rich and ultra-rich who are basically vulgar social misfits and behave like common criminals by stealing from the people around them.

This government is basically an enemy of workers, pensioners and all Canadian families. A good example of this is the private member's bill that the hon. member for South Surrey—White Rock—Cloverdale is trying to introduce, which directly attacks the ability of workers to associate in order to negotiate in good faith, as equals, with their employers.

The government is handing Canadian families over, with their hands tied, to a few national, but mostly foreign, interests. It is scaring away jobs, billions of dollars in capital and an industrial potential of which we were rightly proud and which we are going to lose because this government has given up and refuses to face reality.

I will end on that point. I do not want to get involved in a chorus of insults. I am being upfront about what is particularly important to me.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:45 a.m.

Liberal

Kevin Lamoureux Liberal Winnipeg North, MB

Madam Speaker, I stand because the former Conservative member who asked the question made reference to manufacturing jobs as if they were not important jobs. We in the Liberal party recognize that both manufacturing jobs and high-tech jobs are critically important to Canada's economy. Ontario has been brutally hit over the last number of years as it has lost hundreds, if not thousands and thousands, of jobs in the manufacturing industry.

What is happening at Caterpillar is shameful, and we do want to be able to see the government respond. There are many different ways in which the government can respond, but what is important here is that we send a very clear message to this government. I hope the Prime Minister's thinking is not the same as the backbencher on this particular issue. Rather, all jobs are important jobs to the Canadian economy and the manufacturing industry has a strong role to play, not only today as it has proven in the past but also a very strong role well into the future in the development of our great nation.

Does the member believe the Conservative party was off base when it tried to give the impression that manufacturing jobs were not good jobs?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:45 a.m.

NDP

Raymond Côté NDP Beauport—Limoilou, QC

Madam Speaker, I want to thank the hon. member for his question because I agree with him.

Let us ask the question clearly: why do good jobs that pay $35 an hour have to be wiped out at all costs under false pretences—whether those jobs are in the private sector or the public sector? What does that do for society? How is it bad for society, people, our constituents if those well-paying jobs that provide an annual income of $80,000 or $100,000 are maintained? Those employees provide significant spinoffs in the places where they live.

Thousands of businesses in Canada, thousands of small businesses end up suffering the consequences of outright abandonment and widespread impoverishment. It is scandalous.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:50 a.m.

NDP

Peter Julian NDP Burnaby—New Westminster, BC

Madam Speaker, I very much liked the speech by the hon. member for Beauport—Limoilou. We are talking about massive job losses in the country. Tens of thousands of jobs have been lost, as the hon. member for London—Fanshawe said earlier. Even before these job losses began, this government had already nearly lost 250,000 jobs. Worse yet, as the hon. member knows, the few jobs this government has created pay $10,000 less than the jobs we have lost in the past few years.

My question is for the hon. member for Beauport—Limoilou. We see what is happening: jobs have been lost, salaries have been lost and Canadian families are earning a lot less. In light of all that, does the hon. member think that the government's so-called plan for job creation and economic growth is working?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:50 a.m.

NDP

Raymond Côté NDP Beauport—Limoilou, QC

Madam Speaker, I thank the member for Burnaby—New Westminster for the question. It could have been a rather funny quip. As a Christian, I have to say that this government is upholding the Christian value of sharing—that is, sharing poverty. That is clearly the situation. And that is what is really terrible. They are just encouraging mediocrity and the pillaging of our resources. And not just our natural resources, but also our human resources, our ability to create wealth.

I cannot get over it. It seems that this government is bowing down to a small group of interests, that it wants to maintain these relationships at all costs, and that it has abandoned 33 million Canadians for the sake of a few hundred well-off people. It is absolutely unbelievable

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

10:50 a.m.

Mégantic—L'Érable Québec

Conservative

Christian Paradis ConservativeMinister of Industry and Minister of State (Agriculture)

Madam Speaker, I am disappointed by Caterpillar's decision to close the Electro-Motive Diesel facility in London. This facility has had a long history in London and our government sympathizes with the workers there. We will continue to monitor the situation closely.

That being said, in essence this is a labour dispute between a company and a union in a provincially regulated jurisdiction. The federal government does not have the power to interfere.

In addition, I would like to say that I especially empathize with the workers at White Birch Paper in Quebec City. This company was under the protection of the Bankruptcy and Insolvency Act for two years, and it is very difficult to see working men and women find themselves in this situation. It will come as no surprise to anyone that I disagree with what the NDP has said in this regard, both today and in the last month.

I would like to take the time today to address certain statements that have been made. First, I would like to quickly explain the situation of White Birch Paper to the members of this House. This company owned three paper mills in Quebec between 2004 and 2008, including the Quebec City paper mill, which was purchased in 2004, and the Soucy and Masson mills, which were purchased subsequently. These mills were profitable for a while. However, the company ran into financial difficulty and filed for bankruptcy protection in February 2010.

In September 2010, the court approved the purchase of the three paper mills by a new owner, but the purchase was conditional on a new agreement between—a new agreement with the employees. As we all know, the new agreement was never signed, so the paper mills have not yet been sold to the court-approved buyers. In the meantime, the current owners decided to close the Quebec City mill.

I think it is important to clarify that the Quebec City paper mill had already been sold once in a transaction that required the Minister of Industry's approval. I am referring to the 2004 sale. White Birch bought the mill in a transaction approved by the former Liberal government.

We sincerely hope that there will be a future transaction representing a net benefit to Canada. However, the current situation is not covered by the Investment Canada Act. This situation is about solvency and labour relations, which are governed by provincial legislation.

The opposition has not done its homework. Once again, it has proven that it is incapable of governing. The opposition is way out in left field on this issue.

Next, I will discuss the history of the Electro-Motive Diesel facility. As the facility is in the constituency of the member for London—Fanshawe, I am somewhat concerned that I need to inform her that this plant has never been Canadian-owned. It has been American-owned from the very beginning, back in the 1930s.

Electro-Motive Diesel was initially owned by an Ohio-based company. It was then purchased by General Motors who in turn sold it to American private equity firms back in 2005. Then Electro-Motive Diesel, including facilities in Canada, the United States and Mexico, was purchased outright by Caterpillar, another American company.

The history is important within the context of my second point that this transaction was not reviewable. The reason it was not reviewable is that the plant changed owners when Caterpillar, a company based in a WTO country, bought Electro-Motive outright, another company based in that WTO country. Electro-Motive also had assets in Canada.

According to the Investment Canada Act, indirect acquisitions are not subject to review under our World Trade Organization obligations. That is the law. Those are our trade obligations at the international level. This is based on the belief that free and transparent trade creates more jobs and opportunities in the long term than the protectionist barriers on the NDP's wish list ever could.

With respect to those who have said that the government approved this transaction, they are mistaken. No such approval was required.

With respect to those who have said that we should retroactively review the transaction now, the law neither required nor allowed for a review to take place in the first instance, so a second review would be equally out of the question.

Finally, with respect to the leader of the third party who on Monday asked in the House “...how it could be that the government could have allowed such an investment without receiving guarantees from the company with respect to its future intentions...”, I would point out that this is the same law his current party oversaw for 30 years and in such time did not see fit to block a single transaction.

There is also another misconception that I need to correct. The member for London—Fanshawe has referred in her public communications to a $5 million tax break, and she appears to be of the belief that Electro-Motive Diesel received a $5 million subsidy. She is wrong on that point. In fact, with the greatest respect for my colleague across the way, the member is so wrong that she is either deliberately misleading Canadians or does not understand how the tax system works.

For the sake of clarity, let me read the section of budget 2008 that addresses support for the purchase of new locomotives:

Both the Standing Committee on Industry, Science and Technology and the Standing Committee on Finance have recommended an increase to the CCA rate on rail equipment. Budget 2008 proposes to increase the CCA rate for railway locomotives to 30 per cent from 15 per cent. This change will ensure that the CCA rate for railway locomotives better reflects the useful life of these assets. It will also encourage rail operators to acquire a newer, more fuel-efficient fleet of locomotives (e.g. hybrid locomotives), which provide a more environmentally-friendly mode of transportation.

This change is effective for new locomotives acquired on or after February 26, 2008, as well as for reconditioning and refurbishing costs incurred on or after February 26, 2008. It is expected to reduce federal revenues by a small amount in 2008-09 and by $5 million in 2009-10.

How this works is simple. Companies that buy locomotives benefit from a 30% capital cost allowance rate, whereas they used to benefit from a 15% capital cost allowance rate. The manufacturers of locomotives get no special tax break.

This measure was brought in to promote the purchase of more fuel-efficient locomotives. It was brought in with the enthusiastic cheerleading of the NDP. While that party did not see fit to actually vote for it in budget 2008, the NDP members did support the measure when it was recommended by the industry committee back in 2007.

I know that the NDP understands how capital cost allowances work. The question is, why are those members now deliberately misleading Canadians in order to score cheap political points?

The only logical conclusion I can draw is that the NDP is using struggling workers as an excuse. Now Quebeckers are learning more and more about the NDP's hidden agenda, which is based on a radical ideology that will directly destroy thousands of jobs. The NDP does not want Canadian companies to be involved in international trade. Its members are hostile to foreign investment and do not want Canada to be an economically productive country.

NDP members have voted against every single measure that we have taken to support manufacturing in this country, for example, providing tax relief to individuals, families and employers. They voted against enacting a 50% capital cost allowance rate for machinery and equipment. They voted against eliminating tariffs on machinery and equipment and industrial inputs. They voted against investing in skills training and infrastructure. They voted against supporting research and efforts to commercialize innovation. They voted against extended work sharing agreements to assist workers. I could also speak about forestry measures, where the NDP voted against the softwood lumber agreement and the black liquor $1 billion subsidy. Those members also voted against the $1 billion for the community adjustment fund. They voted against the $1 billion community trust fund.

That is all we need to know. In the middle of the worst economic downturn of our lives, the NDP wants to create obstacles for businesses that want to create jobs. It wants to make Canada less attractive to investors. In practical terms, during the first six years of our government, foreign companies invested nearly $270 million in Canada through transactions requiring review and another $150 million through transactions that did not require review.

On the other hand, the NDP plan for high taxes, carbon taxes, trade barriers, a hike in gas prices by 10¢ a litre and opposition to our natural resources sector is a plan that would erase all of that investment in the blink of an eye.

Third parties have confirmed that if we were to apply the plans currently proposed by the opposition, Canada would lose over 400,000 jobs. In the middle of our fragile recovery, that is simply terrifying. Those jobs would disappear because the NDP's mediocre economic plan includes massive tax hikes.

It is clear that the NDP economic thinking leads to false promises, dead ends and economic ruin.

Our government has an economic recovery plan that is working and, unlike the opposition, our government understands the importance of attracting foreign investment to Canada. We welcome foreign investment, innovation, international expertise and, more importantly, we welcome job creation.

Our government has a long-standing good reputation for welcoming foreign investment because it is an important driver of Canada's economic success.

Our government is determined to send the most favourable message possible to investors around the world to promote Canada as a secure and stable country and a great place to do business and invest.

Major investments will continue to be subject to review under the Investment Canada Act.

However, it is important to point out that the purpose of the Investment Canada Act is to provide a review of major investments in Canada in a way that encourages investment, economic growth and job opportunities in Canada.

In 2009, our government amended the act to strengthen it and especially to encourage foreign investment.

On the strength of recommendations from the Competition Policy Review Panel, the act was amended to liberalize the foreign investment review process. Once in force, these amendments will raise the investment review threshold to focus our reviews on those investments that are most significant to the economy and to better reflect the increasing importance to our modern economy of service and knowledge-based industries.

What is more, in 2009, we eliminated the barriers in the Investment Canada Act that targeted certain sectors, in order to ensure that investment in those sectors is subject to the same rules as in other economic sectors; this improved certainty.

Those barriers were an additional unnecessary burden for industries subject to efficient government regulation.

In addition to these amendments, we also introduced a review mechanism with regard to national security into the Investment Canada Act in order to ensure that, with increased foreign investment, Canada's national security interests are protected.

Other changes were made in 2009 in order to improve transparency in the review process and we acknowledged that there could be room for more improvement when it comes to transparency in the legislation.

I would add that the previous Liberal government never felt that such an acknowledgement was necessary. It is funny to see the Liberals here today take a totally different position.

I can assure the House that we are looking at the best ways to provide more information to Canadians about the review process, while ensuring that confidential commercial information remains protected. It is a question of balance.

Once again, this government's objective is to promote foreign investment. It is vital that our system guarantee investors that their confidential information will have the same protection in Canada as is afforded elsewhere in the world.

This cannot be a one-way street. By encouraging greater foreign investment in Canada, we are leading by example. If Canadian businesses hope to expand to new markets and compete successfully with the best in the world, we must walk the talk here at home and demonstrate to the world that protectionism is not the path to economic growth.

Make no mistake, when a foreign investor breaches undertakings that it has made to our government, we will not hesitate to take it to court to ensure it lives up to its commitments. That is exactly what we did in the case of U.S. Steel. We took U.S. Steel to court when we felt it did meet its commitments. That action resulted in a new agreement between U.S. Steel and the Government of Canada.

Under the agreement, U.S. Steel agreed to important commitments. As well, U.S. Steel will continue to guarantee pension funding obligations for over 15,000 current and retired employees. This means jobs and continued economic activity in both Hamilton and Lake Erie. Therefore, Canadians can rest assured that when the government believes that undertakings are not being respect, we will act.

As an aside, I would like to point out that it is not just foreign investment that we want to attract. We want Canadians to continue investing in our country. That is why we have a low tax plan for jobs and growth, which is working.

Canadians gave us a strong mandate to protect and complete Canada's economic recovery. We cannot say it enough: the top priorities for our government are job creation and the economic recovery. We are working hard and tirelessly to support Canadian workers during the recovery with our economic action plan, which has a track record of 6,000 net new jobs since July 2009.

We have also acted in the interests of Quebeckers by settling the sales tax harmonization issue. All Canadians must realize that this is a government that takes concrete action. We will not be shifted off course by the opposition's smoke and mirrors, such as this motion.

The NDP would undo all of that good work. The motion before us demonstrates that the NDP wants to shut down foreign investment in our country, and at the root it exposes a reckless high tax, dangerous plan for our economy.

Canadians have sacrificed too much in the interest of keeping our country strong during the global recession to accept a plan as destructive as that of the NDP. Therefore, I urge all members of this House to vote against this motion.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:10 a.m.

NDP

Alex Atamanenko NDP British Columbia Southern Interior, BC

Madam Speaker, the minister, as in other speeches, listed all the supposed good things the government had done, plus he listed all the criticisms and why our party did not vote for this or that bill.

For the record, people should understand that a lot of the measures the government has presented have come under what we call omnibus bills within the last Parliament, and in this one. When a number of measures are included in a bill, there is no possible way we can vote for it, measures such as hammering veterans, or those people who are unemployed, or seniors or taking away the level playing field with the federal subsidy to political parties. I could go on and on. Then Conservatives say that we voted against the black liquor, which helps the pulp mills. For the record, people should understand that has been the tactic of the government. However, I will get to the question.

Our motion is a reaction to human suffering in London, Ontario. How can we get all of the spin saying that all these good things are happening and we are getting high-tech jobs, while at the same time, a previous speaker insulted the fact that workers worked in the manufacturing sector?

My question for the minister is simple. Should we not have a policy, as the government introduced further corporate tax cuts, whereby the company should have a business analysis plan of how it will create jobs in our country and how it will ensure that we have research and development that stays here? This plan should be submitted to the government for approval before it does any further tax cuts. Would he agree that this might be a good way of preventing what has just happened in London?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:10 a.m.

Conservative

Christian Paradis Conservative Mégantic—L'Érable, QC

Madam Speaker, I agree with my colleague on one thing. People are suffering in London and that is very sad. We do sympathize with them. However, when we try to make a difference, the members of the NDP want to use this case to play cheap politics on the backs of the workers.

Let us be clear. The NDP invoked the Investment Canada Act today. The plant in London, Ontario has been an American-owned plant since the very beginning, back in the thirties. After that, the plant was sold twice, from an American company to other American companies. Therefore, this is not the issue.

The NDP then talked about tax breaks. I explained very clearly in my speech that it had nothing to do with this. We have to ensure we have good competitiveness in our country and provide a low fiscal regime, which will attract good investment in innovation and in labour training. We will continue down that road.

My colleagues in the NDP want to hike taxes and kill the economy. This is not acceptable. This is not the school of thought from which we come.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:10 a.m.

Liberal

Francis Scarpaleggia Liberal Lac-Saint-Louis, QC

Madam Speaker, during the last election campaign, we were told repeatedly that corporate tax rates had to be lowered or else companies would leave Canada and relocate south of the border. However, only several days after the most recent corporate tax cut, Caterpillar is relocating to the United States. What is more, the company is leaving our country with more money in its bank account because it benefited from the government's tax cuts.

Is it correct to say that the policy to lower corporate taxes appears to be a failure, given that companies should, I believe, have invested this money to increase productivity, which was not the case with Caterpillar?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:10 a.m.

Conservative

Christian Paradis Conservative Mégantic—L'Érable, QC

Madam Speaker, if the hon. member wants to refer to the last election campaign, he should remember that his party was against lower taxes for our SMEs. Yet, we are hearing everywhere, during pre-budget consultations for example, that we must continue in that direction and that this is the way to keep our jobs and provide opportunities for investment and competition. This just shows that we must continue down this same road. I would like to remind the hon. member that 600,000 net new jobs have been created since 2009. That is 600,000 net new jobs since the recession.

I think the facts speak for themselves. One thing is certain: we will continue to recommend a tax plan that is favourable to investment and job creation for our small and medium-sized businesses. That is the way forward.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:15 a.m.

NDP

Irene Mathyssen NDP London—Fanshawe, ON

Madam Speaker, when people need to feed their families, sympathy is simply not enough.

I am well aware of the CCA and the history of Electro-Motive Diesel in London, Ontario. I understand that companies were given a tax break to buy locomotives, but the point is that tax break benefited EMD. It was a taxpayer-funded benefit to EMD. When the workers of EMD needed the federal government, it was nowhere to be seen.

The Prime Minister went into that plant, had a photo op and said that he would ensure their jobs would be safe. When those workers were in trouble, he was nowhere to be seen. If this CCA benefit is so good, why is GO Transit now buying locomotives from Cummins in the United States?

Precisely, what is wrong with fixing the Investment Canada Act to ensure that this travesty does not happen again? What is wrong with providing tax credits to create jobs instead of this—

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:15 a.m.

NDP

The Deputy Speaker NDP Denise Savoie

The hon. Minister of Industry.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:15 a.m.

Conservative

Christian Paradis Conservative Mégantic—L'Érable, QC

Madam Speaker, on this side of the House, we truly sympathize with the workers. We will not play cheap politics on their backs. That is the point.

Let us not forget that this was a regulated provincial issue. It was a labour issue in which the federal government could not intervene. My colleagues just mentioned that the Investment Canada Act had nothing to do with it. An American-owned plant was sold to another American-owned plant. We try to establish good fiscal measures to ensure that we encourage benefits in the country.

The member said that we helped with the capital cost allowance and then it indirectly helped that company. She should not be against that because her party, in the Standing Committee on Industry back in 2007, was a cheerleader for this measure. It was happy about it and said that it would keep jobs here. We tried our best, and we will continue to keep jobs here.

This is unfortunate. When labour issues like this occur, New Democrats should not play cheap politics on the backs of the workers.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:15 a.m.

Liberal

Ted Hsu Liberal Kingston and the Islands, ON

Madam Speaker, I have a couple of questions.

The minister said in his remarks that the purchase of Electro-Motive was not renewable because one party was a company in a WTO country and the other party was also a company in a WTO country. That confuses me a little. When Sinopec purchased Canadian oil sands assets from ConocoPhillips, that was a transaction between two companies located in two WTO countries.

If two companies were proposing to purchase assets that were in trouble, one company being a hedge fund, which had a reputation of simply liquidating the assets of whatever it purchased to extract a value 10% higher than what it paid, and the other company had a reputation of trying to build up distressed assets, to build something big, new and create jobs and innovate, would the government not want to step in? Maybe we should change our rules to give the government a mandate to step in to try to make the best choice for Canadian workers.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:15 a.m.

Conservative

Christian Paradis Conservative Mégantic—L'Érable, QC

Madam Speaker, I explained in my remarks that this was an American owned company that was sold to another and then to another American company. They were obviously WTO-based companies. We are not talking about direct assets purchase.This is the difference.

The member should know this very well. This is the same law that was in place when his party was in power for 13 years. We tried to provide more transparency. We followed the conclusions of the competition committee. We addressed these issues in 2009. We recognized that we can do better and this is under study. We have to keep the balance. We want to attract foreign investment for the net benefit of Canada to create jobs and economic growth. For that, the worst path to take is protectionism. We will not take that path.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:20 a.m.

Liberal

Bob Rae Liberal Toronto Centre, ON

Madam Speaker, I will be splitting my time with my good friend from Halifax West. I appreciate his generosity in allowing me to say a few words today.

I listened carefully to the words of the minister and my colleagues from the New Democratic Party. Although it is difficult in the context of a very partisan House, we have to try to come to grips with some difficult facts about the economy and with difficult challenges that we face. I would say very directly to the minister that if it is the legal view of the government that the Conservatives had no power to review a transaction like the one between the investors who bought the company from General Motors and the fully owned subsidiary of Caterpillar, then we need to take steps to ensure that we can review those transactions. We need to discover exactly the intention of a company that is at the point of purchasing a plant like Electro-Motive.

Like the member for London—Fanshawe, I am familiar with this plant. It was producing locomotives for decades in the province of Ontario. It was a profitable company. It always had a strong relationship with the Government of Ontario in terms of its own mass transit plans. It was an important source of exports, not only in North America, but indeed around the world. The company is well known to me and to many other people. It is a company I visited regularly, as the Prime Minister did on March 19, 2008, when he visited in order to have a photo opportunity and talk about the benefits of low taxes.

The hard fact is that we now realize that there are situations and corporate cultures in which it does not matter what the tax regime is or how far one races to the bottom. The company will still make decisions with respect to its own intentions and its own plans which are exclusively in its interests and not necessarily in the interests of the whole country.

I understand why governments have to say it is not their responsibility, but that of the Government of Ontario. I want to tell the minister that this is not a simple labour dispute. It never was. A labour dispute is when a profitable company and its workers are arguing about 5% here, 5% there or 10% here, 10% there. They argue about going from a defined benefit plan to an employee contribution plan. These are all issues that have been on the table in corporate discussions for a very long time.

When a very profitable company that is not without means, that is not facing a financial crisis, that is not facing a restructuring issue with respect to its operations, tells its workers to take a 50% cut, this is not a labour dispute. This is a company which has made a decision to relocate the plant. It was positioning itself to force the workers to go out on strike and then not have to take it. There was no bargaining with respect to 50%, or 75% or 80%. There was no discussion at any of the bargaining tables, of which I have been aware, of options put forward.

We know that we operate in an open economy, a market economy, an economy in which individuals and corporations have to base decisions on their economic interests.

Since the beginning of this conflict, it was clear that it was not a typical conflict between a company and its workers. The company was demanding wage cuts on the order of 50%, which had never been seen before in the region. The plant was profitable and competitive compared to other U. S. employers, with the exception of some of the company's plants in the United States. Naturally, the workers said that they could not accept a 50% wage cut.

A cut of 50% starts a race to the bottom such that we do not want to see in this country. The harder question for my friends opposite is this: If all the tax cuts in the world do not create an environment in which companies truly embrace the notion of corporate citizenship, do we not then have a problem?

I say to my colleagues from London and from the region, think of the consequences of a 50% cut with respect to mortgages or the buying power of the workers in London. Think of the impact on the whole economy. We are going to see that impact even more strongly, not with a 50% cut, but with the closure of the plant.

There is a challenge to the government, to Canadians and obviously to trade unions. However, this is not just a trade union issue. I think we make a big mistake to say that it is a trade union issue or, with great respect, that it is an NDP issue. The government speech that I heard was not about trying to understand the challenges that we face in this country in remaining competitive, but also in remaining fair.

We have to be competitive. Our economy has to be able to compete and be productive. The question is: Are we going to have an economy that is also fair and that responds to a prosperity that needs to be shared?

What is happening here is part and parcel of a broader trend in our economy. Those who are doing well are doing very well, but those who are doing badly are falling further behind. We have many instances, and the statistical evidence is overwhelming, where we are not moving to an economy in which the rising tide lifts all boats. We are looking at a situation where the rising tide has lifted a few yachts, but it is not lifting all boats. That is the challenge we face.

I know the government would say that the Liberals were in power for 13 years and this is what happened. Frankly, I think we have to get beyond some of that rhetoric and understand that it is not just about scoring partisan points here.

We are saying to the government that it cannot ignore this problem. It cannot say that this is just a labour dispute, not in its jurisdiction, not its problem and that it is doing a great job with cutting taxes. This is not just about saying the government produced 600,000 jobs since such a date. That does not cut it when we look at where those jobs are and what they are.

What is happening to manufacturing in Quebec and Ontario? What is happening to the base of good jobs that pay good wages and produce a standard of living not just for the workers, but for an entire community? That is the challenge that we face.

I certainly do not think we can live in an economy that puts up barriers. We cannot live in an economy that is protectionist. We cannot live in an economy that says we do not want investment. We have to be in an economy that welcomes investment. However, we also have to be in an economy that understands there are certain standards of corporate behaviour that we expect from the most profitable multinationals in the world. Certainly Caterpillar meets that category.

This is where the issue becomes more complex than the one the government is prepared to put forward, or even my friends from the New Democratic Party sometimes in terms of the rhetoric that one hears. It is not about beating up on corporate bad guys. It is about understanding that corporations produce jobs and wealth. If we do not have successful companies, banks and enterprises, then we do not have a successful country.

On this side of the House in the Liberal Party, we accept that 100%. What we cannot accept is that there is no role for governments, both federal and provincial, to play in bringing a reasonable standard of behaviour, whether on pollution, labour standards or employment standards, and to say that there are serious consequences for the community.

I know my colleagues from London understand this question. What is remarkable about what has happened in London is that it is not seen as the trade union versus the company. That is not the issue. It is about some sense of what a reasonable and fair economy is, compared to what we are seeing take place. That is the issue we are facing. Can we have a prosperity that is shared? Can we have a prosperity that is sustainable? On our side, we say we can. These are the things that need to change.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:30 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Madam Speaker, I have a question for the member for Toronto Centre. During the Liberals' 13 years in power, did his party ever intervene in a foreign takeover of a Canadian company?

Could the member give Canadians an example in the 13 years his party was in government where his party intervened in a foreign takeover?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:30 a.m.

Liberal

Bob Rae Liberal Toronto Centre, ON

Madam Speaker, since I was not here at that time, I can only tell the hon. member that from my experience in government there are a lot of instances where governments will engage with companies. They will talk to them about their long-term objectives and what their long-term plans are. That is exactly what needs to happen, what needs to be done.

If the hon. member were to say to me, these are issues that need to be looked at and understood, I would fully agree with him.

To answer his question, I am sure that provincial NDP governments across Canada have had to work with companies, lower taxes, and face the facts. What is going on in Manitoba?

Does my colleague believe that the Government of Manitoba is not interested in ensuring that tax rates and the situation are competitive? Of course it is. But we also have to recognize co-operative citizenship. That is the important issue here today.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:30 a.m.

NDP

Peter Julian NDP Burnaby—New Westminster, BC

Madam Speaker, the reason the member for Toronto Centre could not answer the question that was asked by the member for Vaudreuil-Soulanges is that the answer is “not a single time“. Over 13 years there were thousands of foreign takeovers and not a single time did the Liberal government say it was going to make sure that Canadians' public interest was protected, not a single time. The Liberal Party did not do it one single time. We have an example very clearly of why the Liberal Party sits where it does in the House, down in the corner.

I was very happy to hear portions of the speech. I think portions of the speech really come to repudiate what the Liberals have done over the last few years prior to the Conservatives getting into power. What we have seen is a decline in real income. What we have seen is a loss of manufacturing jobs. It started on the Liberal watch and has continued under the Conservatives.

Is this now, finally, a mea culpa from the Liberal Party about its bad economic--

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:30 a.m.

NDP

The Deputy Speaker NDP Denise Savoie

Order, please.

The hon. member for Toronto Centre.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:30 a.m.

Liberal

Bob Rae Liberal Toronto Centre, ON

Madam Speaker, I have always thought that the hon. member has given a new definition every time he stands to what race to the bottom really means. He creates a new standard for partisanship every time he speaks. When he spoke in debates on free trade, he accused his opponents of condoning mass murders in different countries. He accused us all of not understanding anything at all about life in a variety of countries.

I have to tell the hon. member and all the other members who speak in this House on issues of the economy that I see a real double standard. I do not hear a coherent picture from the New Democratic Party. I do not hear it from the New Democrats' leadership discussions. I do not hear it from him and the other critics with respect to really understanding the importance that yes, there is a necessary tension between creating a competitive economy and creating a fair economy. It is not about simply scoring cheap partisan points. If he wants to engage in that kind of debate, believe me, I can do that as well as anybody in the House. I just do not think it is worthy of us in this House at this point in time to be engaging in this.

This is a tough question. How do we ensure the survival of companies that are in economic difficulty? How do we say to workers that sometimes concessions have to be made? Sometimes they do have to be made to save jobs and sometimes they do have to be made to allow for competitive changes to take place.

What I am suggesting is that with respect to this particular situation in London, that is not the case. Any time the member wants to have a serious discussion about the economy, I welcome it. If he wants to engage in cheap shots for a living, fine, he can go ahead.

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:35 a.m.

Liberal

Geoff Regan Liberal Halifax West, NS

Madam Speaker, I want to congratulate our leader, the member for Toronto Centre, for his excellent speech. I would be anxious to hear perhaps after my speech when there is time for questions and comments, if members of the NDP can think of a foreign investment that has occurred in Canada that they would have approved. I do not get the sense that there has been a time when they have ever approved of any foreign investment. I wonder if they think that foreign investment in Canada has any value.

In most countries governments and people do want to see foreign investment and the creation of jobs that results from that. That capital flow into a country is important. I would be curious to hear what the NDP would do to encourage that kind of capital flow and investment in Canada, rather than just trying to scare off companies.

Having said that, I do commend the member for London—Fanshawe for bringing this issue before the House today.

I know the members of the Liberal caucus are convinced that our party must be committed to fighting for prosperity for everyone. This is a clear case of why we can never take our prosperity for granted.

Of course our hearts go out, as I am sure those of members on all sides do, to the workers who have lost their jobs, and their families, who have been left wondering about their future. What comes now for those who have worked for Electro-Motive Diesel in London, or for Papiers White Birch in Quebec City? This debate will clearly show that the Conservative government's priority is neither to create jobs, nor to protect the jobs of these hard-working Canadians.

Let us put this in the context of the overall economic management of the Conservative government. It is a government that came into power with a surplus of $13 billion and by April and May of 2008, before the recession began later that fall, it had already put Canada into a deficit. What horrendous fiscal mismanagement.

It is important to keep that in mind when we think about what the government has done in terms of economic management, and when we think about jobs and investment in Canada.

Instead of moving to amendments to strengthen the Investment Canada Act, what is the government doing? It is attacking seniors' pensions. That seems to be a good response. What are the priorities of its caucus members? They are raising issues like abortion and the death penalty. The ministers are sitting on their hands while significant job losses occur right under their noses. This gives an indication of the priorities of the Conservative Party. As we see in such a range of ways, they are ideological priorities. We look at the choices it makes, such as saying that the OAS and the GIS are not that important, that we do not have to worry about people in the future who are getting older. That is nonsense.

We know the residents of London, Ontario are deeply upset about the loss of 465 jobs after Caterpillar Inc. announced it intends to close EMD, Electro-Motive Diesel. The media have also pointed out that this plant closure is also very troubling for what it says about Ontario's ability to compete for manufacturing jobs. We have all watched in recent years as our dollar has climbed to parity and sometimes above parity with the U.S. dollar, and what that has meant in Ontario and Quebec for manufacturing jobs. It is a very difficult and troubling time. I heard it said years ago that with our dollar below 90¢ and certainly below 85¢, we can be extremely competitive and it is easy for us to sell our goods elsewhere, especially into the U.S., but when it is above 90¢, it gets a heck of a lot tougher.

Naturally, we know there are benefits to having the dollar at par. Having a high dollar allows Canadians to have cheaper access to goods that come from outside the country. It allows Canadian companies to buy equipment that can help them become more productive and competitive. There are benefits as well, but the impact we have seen from a variety of things, not only the dollar, but the developments globally in places like China and India and the movement around the world of manufacturing are things that we and the government have to come to grips with.

With respect to Caterpillar, an article in the National Post recently stated:

Caterpillar seems to have been a particularly unscrupulous employer, intent on closing down the plant, even while it dragged its employees through the charade of wage negotiations that were never going to bear fruit.

What happened in Quebec is also disturbing. People are very upset about the closure of White Birch Paper, which meant the loss of 600 jobs. The Prime Minister and members of his cabinet keep saying that the economy and jobs are their top priority, but Canadians now know that those promises are nothing more than empty rhetoric.

Earlier this week when the Minister of Industry was asked what measures he took to protect those jobs at Electro-Motive, he threw up his hands in defeat, acknowledging his utter failure. Here is exactly what he said:

[T]his issue falls entirely within the powers of the Ontario government and there was no ability for the federal government to intervene.

What a defeatist, unconfident approach. The workers at Electro-Motive deserve better from the government and the minister. He should have demanded a meeting, for starters, with Caterpillar instead of trying to pass the buck and avoiding any accountability. When there was a photo op in 2008, the Prime Minister was front and centre at Electro-Motive Diesel smiling for the cameras. When there was an opportunity to help the workers at EMD, the Conservative government left them to fend for themselves, which is generally the Conservatives' attitude toward most Canadians.

What does it say to the folks lined up for a double-double at the local Tim's when they see the priority of the Conservative government is to create jobs for an additional 30 MPs by adding 30 more seats to this House instead of protecting the jobs of those workers at the Electro-Motive or Papiers White Birch plants?

Opposition Motion—Investment Canada ActBusiness of SupplyGovernment Orders

11:40 a.m.

An hon. member

Interesting priorities.