Debates of Oct. 23rd, 2017

Questions on the Order Paper

[Some hon. members]

Agreed.

The House resumed consideration of the motion.

Opposition Motion—Minister of Finance and Conflict of Interest Act

[The Speaker, Liberal, Geoff Regan]

The hon. parliamentary secretary to the government House leader has 17 minutes remaining in his comments.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I was fortunate to have the opportunity just before question period to share some thoughts on the calling into question a number of issues with respect to the Minister of Finance, whether it is the motion before us today or the official opposition motion bought forward last week. Today, I would like to provide a different insight.

I was on the opposition benches, both in Ottawa and in my home province of Manitoba, for just over 20 years. I understand the role of opposition. We want to be constructive in our criticism and in opposition we are more inclined to look at where the government could improve itself in policies and so forth. I would argue that the opposition day motion today goes far beyond that for a couple of reasons.

Each and every one of us, including you, Mr. Speaker, will recall that when we were elected to this beautiful chamber, representing literally thousands of Canadians, there was a responsibility for us to establish communication with the commissioner's office. Forms need to be filled out and declarations were made to the commissioner. We also look for advice on what we need to do to follow the law, to be in sync with our obligations and to disclose our investments. I have done it to the very best of my ability. I do not have much, but I do have some.

I fulfilled my obligation to the best of my ability, as I know the Minister of Finance has done, as have members in the opposition. It is important to recognize that Mary Dawson and her office do not only handle cabinet. They are responsible for each and every member of the House of Commons. I suspect we will likely find there are ongoing investigations of some sort, or questions being posed by the commissioner's office to opposition members as well as government members.

When that contact is made and a member gets a recommendation from the commissioner, there is an expectation the member will follow the advice and recommendations of the commissioner. After all, that is the law. It is the very same law Stephen Harper had in place. When Stephen Harper was prime minister of Canada, his cabinet followed the very same process that this government's cabinet has followed. It is not only the government members. Even back then, it included opposition member as well, including me. We all had to follow the law.

From what I understand, the commissioner's office, directly or indirectly, has met with all 338 current members. There is a reason we have that. It is because at times it gets so politically charged in the House that it is somewhat hard for the opposition, and periodically even the government benches, to not be overly biased.

In my two years on the government side, time after time opposition members have united against the Minister of Finance. Virtually from day one, from Bill C-2, to budgets, to all forms of announcements, they have attacked the Government of Canada through the Minister of Finance, as well as the Liberal caucus as a whole.

I do not know if it was Winston Churchill who commented that Parliament and democracy were quite messy at times. Some have said it is a blood sport. Churchill went on to say something to the effect that it is still the best system in the world. I believe that to be the case, that we do have a fantastic system, the parliamentary process. However, there are certain aspects of the parliamentary process that we want to be truly independent. We have established officers of Parliament to ensure that independence.

One of those is Elections Canada itself. All Canadians are aware of Elections Canada and its fine work for all of us. That institution is known throughout the world for contributing so much to the well-being of democracy, not only here in Canada but outside of our borders. It has an independent officer of the Parliament of Canada. The commissioner is independent as well. We have an Ethics Commissioner who is independent, meaning that he or she should not be influenced by the government of the day, the Conservative Party or the New Democrats. That is the way it should be.

That is why it is really important that throughout this debate Canadians understand no violation has taken place by the Minister of Finance, despite the many assertions being made by the members opposite. The minister himself has made it very clear that to appease the concerns that are out there, he is prepared to divest himself of his personal finances in certain areas and to put other things into a blind trust. He sought the advice and recommendations of the Ethics Commissioner, and has followed that advice, as well as any recommendations provided to him. Moreover, he has seen fit to go over and above that in order to establish the right perception, which is important, because he wants to ensure that we can move on in the best way we can to what this government has said is its first priority since day one in office.

From a media outlet I found an interesting clip with respect to the member for Skeena—Bulkley Valley, the person who introduced today's motion. From what I understand, the member across the way, the person who has now decided to attack the Minister of Finance, is reported to have said that if there's a silver lining in this controversy, it is that it might push the government to close loopholes in the Conflict of Interest Act. With that sort of a comment, even the NDP recognize there is nothing illegal taking place and that the Minister of Finance has done virtually the same thing that every member of the House is obligated to do. The member is suggesting that maybe we should be changing the Conflict of Interest Act. I would much prefer to have that sort of a discussion, rather than the character assassination that we have been witnessing by both the NDP and the Conservatives and, I would ultimately argue, the undermining of the independent office of the commissioner. That is what I have been witnessing from both opposition parties. I say that because whenever the Conservatives or the NDP have any hint of an opportunity to be critical of this Minister of Finance, they have jumped all over it every time.

If we ask ourselves what the Government of Canada's priorities are, there is a litany of things that we have done to reinforce how important Canada's middle class is and those aspiring to be a part of it.

The Conservatives are so out of touch with what Canadians want and the NDP seem to so want to buy into the Conservative spin and the issues of the day that they vote together. Their opposition motions are now following each other's. I would suggest they are going in the wrong direction. One of the things that Conservatives have demonstrated over the last two years is that they continue to be out of touch with what Canadians really and truly want and expect of government. Instead, as I say, every opportunity they get, they are critical of the Minister of Finance.

I would like to go through some examples, and then argue, using these examples, that we have a joint opposition that is out of tune with what is important in the everyday lives of Canadians. We can start from day one of the government. Our Prime Minister who made a commitment to Canada's middle class that we were going to put Canadians as the number one priority. I believe it was Bill C-2 that provided a tax cut for Canada's middle class. It was incorporated into the budget bill.

There was a great debate on that first budget. If members followed the debate at that time, we had Conservative after New Democrat stand in their place, being nothing but critical of the Minister of Finance. The Conservative and New Democrat members criticized the government for giving a tax break to Canada's middle class, the most significant tax break in generations focused on the middle class, while at the same time increasing the taxation of Canada's wealthiest 1%. That is not an attack on the 1%, but rather it is saying that Canadians, including the constituents I represent, want a sense of fairness in taxation policy. In that very first budget, Canadians got to see a significant redistribution of wealth and responsibility in taxation. It was a fairer reflection of what it is that Canadians wanted to see. That is one of the reasons we got the mandate that we did.

Let us look at what happened immediately following that. Whether it was a Conservative member of Parliament or a New Democrat member of Parliament, they jumped all over it and criticized the government. In fact, all members need to do is read the Hansard. The difference between the two did not matter, because it was hard to tell the parties apart at times they were so close together. We saw both parties voting against the tax break for Canada's middle class. They voted against the tax on Canada's wealthiest 1%.

There were other initiatives in the budget that tried to deal with the economic conditions of Canadians. An example of that would be the Canada child benefit program. No surprise, because once again both parties voted against it.

The Minister of Finance brings forward something and we have the joint opposition being critical of the minister. On that particular point, I must say that it was the budget that ultimately ended millionaires' ability to receive the Canada child benefit, and gave more money to those individuals who had less. It literally lifted thousands of children out of poverty. I wonder if their criticisms were of the merits of the bill or if they had something personal against the Minister of Finance.

What about the guaranteed income supplement program? It is the same principle at play. What did the opposition parties do? We have to conclude that they just do not support the Minister of Finance, because when he made that change they were critical of the minister. It is hard to believe they voted against an initiative that would lift thousands of seniors out of poverty in every region of Canada.

The Minister of Finance is the one who leads the way. Let us go to the summer. Last summer, the Minister of Finance went out to all the regions. We had members of Parliament charged with the responsibility of listening to what their constituents had to say and report back. I am proud to say that Liberal members of Parliament did just that. From the initial announcement to the opening of consultations with Canadians, we saw tangible results from Liberal members of Parliament. They went into their constituencies and worked hard and effectively to improve and bring forward a fantastic tax change program that would make the system fairer. Once again we have the Conservative and NDP members screaming at the Minister of Finance whenever they have the opportunity to do so.

I see that I only have a few seconds left, so let me suggest to those who are following this debate that the Conservatives and NDP members have clearly demonstrated that they do not like the Minister of Finance. I can tell everyone that the advice of the independent office of the Ethics Commissioner is what the Minister of Finance is following, and he has made a commitment to continue to follow any such advice and recommendations by that office. He has even gone further, as shown by some of his personal actions.

[Pierre Nantel, NDP, Longueuil—Saint-Hubert, QC]

Mr. Speaker, it is good to be able to say something after hearing my colleague across the aisle speak for so long.

Evidently, his rhetoric lacks nuance. It is like a horn blaring, whether he is talking about the noodles he had at lunch or about the worst scandal ever to involve a Minister of Finance. It is appalling to see such an important thing trivialized. The hon. member cannot say that we should trust the Minister of Finance and praise him for all the wonderful things he has done. Come, now, it is a huge conflict of interest, one for the history books.

I would like to ask my colleague if he can get the message across to the people around him that the problem is serious. They do not seem to realize it at all.

Is my colleague on automatic pilot as usual, or does he really understand what is going on?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I understand. That is why I am disappointed that the combined opposition did not want to use this day to possibly look at the same rules that Stephen Harper, and other prime ministers, but in particular Stephen Harper, had in place for their ministers, rules that we all had in place. As opposed to attempted character assassination, why not allow for a good healthy debate on ways that we can maybe improve the conflict of interest legislation? Let us hear the ideas that members might have that would be applied to not just one member—who, by the way, has been following the rules—but to all members of the House. That would be a far healthier debate, as opposed to continuing this one.

I was proud of the Minister of Finance today in question period when he stood up and said that while the opposition is concerned about his personal finances, the Liberal caucus, at the very least, is concerned about the finances of Canadians. That is where our concern will continue to be in the years ahead.

[Alex Nuttall, Conservative, Barrie—Springwater—Oro-Medonte, ON]

Mr. Speaker, I find it very difficult to take some of the points the hon. member has put forward to the House today when we look at what the Minister of Finance and the Prime Minister have been saying. This is a minister who is going around the country essentially calling small business people tax cheats who are looking for and finding tax loopholes.

What did we then find out? The minister did not need to look very far to find people who were looking for loopholes and using them; he just had to look in the mirror. That is all he had to do. If he were looking for someone who was using loopholes, all he had to do was to look in the mirror. That is a result of how he set up his corporate holdings to avoid some of them going into a blind trust. We know that because of the amount of money he has made through the decisions he has made as the finance minister on bills that he is putting forward to the House.

When will the Liberal Party stop focusing on hard-working honest Canadians and instead start focusing on their own morals and ethics, which are so lacking?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, as I said, these are the same rules in which the member's own party under Stephen Harper had in place, and that is conveniently being overlooked by the Conservatives.

The member made reference to small businesses. The outreach that this government and all its members have conducted over the last number of months has been simply amazing. We have taken a package and, at least on this side of the House, Liberals have taken it seriously. We are seeing a fantastic reform package, which is going to make our taxes even fairer and better for Canada's middle class and those aspiring to be a part of it.

The member made reference specifically to small businesses. Last week, we had a reduction in small business taxes from 10.5% to 9%. This was an election platform issue, and that—

[The Assistant Deputy Speaker, Liberal, Anthony Rota]

I am sorry, but I am trying to hear the hon. member's answer and I keep getting this nattering in my ear.

I will let the hon. member continue.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, this is very good news for small businesses. Last week, we had an announcement where taxes on businesses will be reduced from 10.5% down to 9%. This was an election campaign platform, and that is an election campaign platform that has been kept.

When the member asks what about Canadians, imagine, over 400,000 jobs were created in less than two years by this government. Putting that in the perspective of the Harper government with just over one million jobs in 10 years, I would say that this government is delivering.

[The Assistant Deputy Speaker, Liberal, Anthony Rota]

I want to remind members that there are quite a few people who have questions for the hon. parliamentary secretary, and we would like to get in as many as possible. I would ask members to keep their questions precise, as well their answers.

The hon. member for Hamilton West—Ancaster—Dundas.

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Speaker, on behalf of my constituency, I am very pleased to have an opportunity to ask the member a question this afternoon.

The first thing I would like to say is how impressed I am, as a new member, in the work ethic of all members of this House. To see the diligence and work ethic is extremely impressive. That has been very uplifting for me as a new member.

However, there is an area that I am not so pleased with, and that has to do with the tone and demeanor in this House. What I have experienced is that it is a win in this place to make someone else look bad, to discredit, and to make someone feel put down. I would like to see much more collaboration and people working together in order to heighten what we can produce in this place, and I know my constituents feel the same way.

I would ask the member if he agrees that there is more to be done, so that we have a collaborative spirit in this place where we can get more legislation passed and work in the best interest of Canadians. If so, what things could he present that would help us attain that goal?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I appreciate the fine question from my colleague. I know that she is very genuine in what she is talking about, and we all want to see more productivity out of the House of Commons. There is always room to be better, as our House leader reminds us virtually on a daily basis, which I think is a good thing.

This is one of the reasons I highlighted that we need to respect that the office of the commissioner is independent. If we recognize the importance of the independence of all of our parliamentary offices, it would be a positive thing.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I usually thank my colleagues for their contributions, but it is somewhat difficult to do so when it comes to this colleague in particular.

I would like to ask my colleague a simple question about what is written in the motion. It is about acknowledging that the Conflict of Interest and Ethics Commissioner uncovered an obvious loophole in 2013. She was talking about the fact that the law specifies “direct control,” which can be interpreted to mean that indirect control is acceptable. She pointed out that this was contradictory to the spirit of the law, and that indirect control is as objectionable as direct control.

Can my colleague address this part of the motion and give his opinion concerning the loophole that the Conflict of Interest and Ethics Commissioner was talking about? My colleague keeps saying that we need to trust the commissioner. This is the opportunity he has been waiting for to show his trust in the commissioner and accept her recommendation. Will he do so?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, one of the things I truly respect about the House is the fact that we have some fantastic personalities, great working groups, and standing committees. Whether it is the Board of Internal Economy or the procedure and house affairs committee, there are all sorts of informal discussions that take place.

We have had these rules in place for many years. I have often made reference to Stephen Harper, and these are the same rules when he was the prime minister. No doubt, things could always be better. We can look at ways in which we can strengthen the legislation, for instance, raising the issue at the Standing Committee on Procedure and House Affairs.

I suggest that the best way to do this is not necessarily to tie it to an individual, but rather collectively, because all of us have to report to Mary Dawson and that particular commission. We are open to all sorts of ideas and possible recommendations. I would suggest to the member that he bring it up with his house leadership team or the procedure and House affairs committee, or so forth.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, it is always a great honour to rise in the House to represent the people of Timmins—James Bay.

Over my last 14 years in Parliament, I have seen all manner of scandals. I have seen scandals that were just plain idiotic, tawdry behaviour, and scandals that were not really scandals at all, just that sometimes people made mistakes and had to account for errors in judgment. However, they were still accountable to the people of Canada. What we are talking about today in terms of a conflict of interest with the Minister of Finance, to me, speaks to the cynicism of the government and its approach to ordinary working Canadians who work hard and play by the rules.

The conflict of interest we are seeing with the finance minister is that, as the privatized pension king of Canada, he had a very clear financial interest in changing pension legislation. When he was presented as the finance minister for this Parliament, he did not explain to Canadians that he had set up—how would one even describe it—this numbered company that he moved his dividends and profits into, which maintained his connection to Morneau Shepell, the privatized pension operation of Canada.

What we hear from the Liberals is that this is a separate account and not really something that he had control of. It is the same as folks back home putting $100 into a cookie jar, being asked if they have $100, saying no, the cookie jar has $100, then being asked who owns the cookie jar, saying they do, being told that means they have $100, and them saying no, it is in the cookie jar. However, we are not talking about $100. We are talking about millions of dollars of direct benefit for Morneau Shepell.

I want to talk about three issues. The first is the Barbados tax haven that the finance minister has interest in and has been negotiating treaties for without recusing himself. The second is the issue of Bill C-27, which he brought forward without explanation or any prior public consultation, that would benefit the investors at Morneau Shepell, and the third is the one before us today across Canada, the abominable treatment of Sears workers. We were all shocked and appalled when we heard that Sears executives attempted to cut off the financial, dental, and medical rights of Sears pensioners as Sears was facing bankruptcy and, at the same time, paying $9.2 million to its executives. That kind of pension theft is not only legal in Canada, but executives get corporate bonuses for doing it.

I have been attacked on Twitter by the Liberal trolls who said that this was no bricks and mortar issue, it just went the way of the dodo. Sears was a top-notch corporation that was run into the ground by the hedge fund operator Eddie Lampert, who pretty much lost $10 billion of value. One does not cry for corporate bandits like Eddie Lampert and his crew, because as Sears was getting into trouble, its hedge fund operators basically loaned $500 million to Sears through taking 46 key properties as collateral assets. If Sears went down, those hedge fund operators walked away with the property. Therefore, they are sitting pretty.

We approached the finance minister and asked him to change that loophole to protect the pension rights of Sears workers. That is not asking for anything special. It is asking to ensure that when people have paid into a pension for their whole lives, it is not at the back of the line when creditors come, that it is considered part of the credit that has to be protected. The finance minister will not do it, and we did not know until October 17 that Morneau Shepell was getting the contract for the Sears workers. Is there a direct link? The direct link is that the dividends go to Morneau Shepell investors, of which the finance minister is one. That needs to be explained to Canadians.

I am deeply concerned about Bill C-27, because in 2013, as the head of Morneau Shepell, the current finance minister talked about the role that Morneau Shepell played in moving towards targeted benefit plans and how there was a need in Canada to change the legislation to benefit the investors of Morneau Shepell. When he became finance minister, he introduced Bill C-27, which was the legislation to do just that. What is striking about Bill C-27 is that there were no prior public consultations or public meetings. Therefore, who gave the advice to the finance minister to change legislation that would have an enormous impact on the company that he and his father helped found?

Bill C-27 is a clear conflict of interest. It is a conflict of interest that touches Canadians who are worried about the future of their defined pension benefits across the country. It is a right of Canadians to believe that parliamentarians will put the interests of the public ahead of their own pecuniary interests. That is the whole question of conflict of interest.

In the case of the Minister of Finance, bringing forward legislation that would have a direct benefit to his company without recusing himself is an abuse of his role as a minister of the crown and needs to be explained. It is also an abuse of the House, because we did not know that he was receiving dividends from Morneau Shepell throughout this period.

To note, I will be splitting my time with the member for Sherbrooke.

Now we find out about the Barbados tax havens. The Minister of Finance is signing a tax treaty with Barbados. I know Barbados sounds like a great place for sand and hanging on the beach, but it is notorious as a fiscal paradise for companies that do not want to pay their share. What is really disturbing about Barbados is that we found out that Morneau Shepell is involved down there. There is a direct financial interest. The minister did not recuse himself. How could he be working on a treaty with a place that is a notorious fiscal paradise when Canadians are paying their fair share and they are looking to the Minister of Finance for accountability?

I know my friends in the Liberal Party are in trouble on this issue, because whenever the Liberals are in trouble on a file, they start throwing out the term “middle class”. In fact, they say the “middle class and those wanting to join them”. Folks back home, if they were in some of kind university drinking game, where every time the Liberals said that in a speech they had to take a shot, they would be bombed at the end of the first five minutes.

I guess the Minister of Finance grew up in a different middle class than I grew up in. His middle class is going after dentists and farmers. His middle class is going after people who are suffering from diabetes. His middle class is going after employee discounts at restaurants in order to tax them. Meanwhile, the one first promise that the minister broke was the $840-million corporate stock loophole that would protect 8,000 insiders on Bay Street. He reassured Bay Street that he would have their back.

Right now the Liberals are saying that they are doing all of this for the middle class. They are setting up a tax haven treaty with Barbados for the middle class. The Minister of Finance is attacking the pension rights of Canadians across the country, through Bill C-27, for the middle class. Of course, the Sears workers, well, they are out of the middle class altogether.

It reminds me of when the Liberals were caught out on the Saudi arms deal. They were dealing with House of Saud to help the middle class. That was the Prime Minister. On their abandonment of electoral reform, he said we had to do it to protect the middle class. Cash for access was the golden one, where Chinese billionaires were paying $1,500 to meet with the Prime Minister. He was asked, “What could you possibly be meeting with Chinese billionaires about that was not a conflict of interest?” He said that they were talking about the middle class. Imagine that. Imagine that is what billionaires talk about.

This is about abuse of public trust. This is about a Minister of Finance who has broken the trust of the Canadian people and who owes an apology to this House. This is about a government that has to retract Bill C-27, because it is a clear conflict that will benefit the insiders of the Liberal Party and not Canadians.

We need to have some clarity. Canadians need to have trust that the government they elect is not going to be just looking after the interests of their friends on Bay Street but is going to pay attention, finally, to the Canadians who work hard, pay their taxes, and play by the rules, unlike the government.

[John Barlow, Conservative, Foothills, AB]

Mr. Speaker, I have one thing I would like to ask the member. During the speeches in debate today and again in question period, we heard that there seems to be this move that, as long as Liberals have created jobs, all the other ethical misfortunes and law-breaking of the Minister of Finance should not matter.

Despite all the mirror work that the Liberal finance minister is doing, does the member not think that the Canadian public, and certainly this House, have lost their trust in the Minister of Finance, and that what he says tomorrow in his financial update should not take away from the ethics mismanagement and his law-breaking?

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, the issue here is about trust. This is about when one gives someone a position of immense power, that one has to believe, whether one agrees with their decisions or not, that they are making these decisions for the benefit of this nation. We cannot say that this finance minister has put the interests of working people or the nation ahead of his own pecuniary interests. It is a shocking breach that has to be addressed, particularly given that he is the finance minister.

The Liberals said last week that we are all in this together. However, not all of us decide pension policy in this country. I do not know how many of us get to forget that we own a French villa through a numbered company, or how many of us are on the tax registry for Barbados tax savings. However, the finance minister is and, because of that, he simply cannot be trusted. Whether or not he stays in that position, we have to have some clear rules. Number one is an apology. Number two, we have to have limits on his ability to interfere in any way with pensions or with issues of tax havens in Barbados.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, the members opposite, and even the mover of the motion, the member for Skeena—Bulkley Valley, had suggested that hopefully we will see some changes to the Conflict of Interest Act. What has been implied is that there is always room for change.

However, I am sure that the member across the way will acknowledge that these are the very same rules that applied when Stephen Harper was the prime minister. Yes, maybe there is a way in which we can improve upon those rules. I am eager to find out how that is, whether through a procedure and House affairs committee, or other venue, in which we can take a look at the rules. All of us have a responsibility to follow the rules. That is something that is important for us to recognize.

What I am asking for the member to acknowledge, at the very least, is that if there is a mood to look at ways in which we can reform or make the changes that have been in place for a decade, what sorts of rules or what format would he then suggest, outside of trying to tie it to one individual?

We all have an obligation to report to the conflict of interest officer, and we all have a vested interest. It is not just one individual inside the Chamber.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, they are quoting the Liberal gospel, which is that he who is without private pension stock funds hidden in a numbered company cast the first stone, and that we are all in this together. No, we are not. This is about the finance minister.

Far be it for me to ever defend the government of Stephen Harper. However, the Liberals are in such bad shape that they say, listen, these rules existed under Stephen Harper. Yes, but his finance minister never set up a numbered company to benefit personal financial interests. If he can follow the rules, why cannot the Liberals?

If these rules are in place for everyone, why is it that the member from Morneau Shepell saw such a huge opportunity? He had a loophole to interfere and change the pension laws to benefit the company he comes from. He could also deal with tax havens in Barbados for the personal benefit of his company by setting up a separate corporation to handle all his finances.

Nobody in the day of Stephen Harper thought of doing something like that, so why is it suddenly acceptable that this finance minister has made such an egregious breach of the rules?

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I would like to thank my colleague for sharing his precious speaking time with me, allowing me to address the House concerning the motion before us today that we have been debating since this morning.

We have heard opinions from both sides of the House, but the Liberals have yet to say anything impressive in defence of the Minister of Finance. Rather, they have tried to change the channel. They have tried to take the focus off the problem at hand. For my part, for the 10 minutes allotted to me, I will stick to the motion before us.

The first part of this motion sets out the facts regarding the matter at hand, namely, the situation with the finance minister and his company, Morneau Shepell. The minister led us to believe that he had placed his shares in Morneau Shepell in a blind trust when in fact he had never done so. His story was even corroborated by his Liberal caucus colleagues. The minister had many opportunities to clarify this situation. Everyone believed that he had placed his holdings in a blind trust. The media reported that such was the case, and the minister even allowed his own company to believe that that is what he had done. When the truth came out, everyone saw that he had not in fact put his holdings in a blind trust. The minister had never bothered to set the record straight since being sworn in two years ago. Everyone believed that he was telling the truth about his holdings. The first part of the motion points out the discrepancy, which the Minister of Finance never bothered to clarify.

The second part of the motion deals with the fact that the minister used a loophole in the Conflict of Interest Act. I can confirm that there is indeed a loophole, not because I used it like the finance minister, but because I heard witnesses talking about it when they appeared before the Standing Committee on Access to Information, Privacy and Ethics, which I chaired for two years.

The Ethics Commissioner appeared before the committee to present her recommendations following her five-year review of the Conflict of Interest Act. That happened in 2013. The next review will take place in 2018 and will be a good opportunity to close the loophole that we are talking about today.

In 2013, the commissioner made over 70 recommendations to update the Conflict of Interest Act. Those recommendations apply to ministers and public office holders. They do not apply only to ministers, but also to some senior officials in the Canadian public service. These public office holders must obey this law. In 2013, the commissioner pointed out a number of problems with the act and proposed ways of making it more effective and updating it to reflect changes in technology.

In her report, she clearly states that the wording of the act specifies direct control, saying that a minister cannot have direct control over a company’s shares. She says that, according to the language, a minister could have indirect control. She raised this question as if she were a visionary who could see that infringements of the act might occur. A public office holder may decide to comply only with the letter of the law, that is, to avoid exercising direct control over a company’s shares, without complying with the spirit of the law.

I can just see the Minister of Finance and his army of lawyers and accountants going to the Office of the Conflict of Interest and Ethics Commissioner and asking a lot of questions, and being told that he cannot exercise direct control over shares, but that he can exercise indirect control over them.

His advisors and lawyers tell him that the only thing to do is to register a company without bothering to give it a name. He can just give it a number, then register it in Alberta where corporate income tax rates are lowest. He can register all of Morneau Shepell’s shares in his company. Thus, he will be the sole shareholder of a numbered company in Alberta.

His lawyers are very smart, and we must give them credit, because their job was to find loopholes in the act, and that is what they are paid for. They did what the minister asked. He asked them to find a way of allowing him to control his shares while complying with the letter of the law.

They told him that they found the solution, that all he had to do was register a company. That is what he did and, for two years, he has had us believe that his situation was in order and that he had even placed his assets in a blind trust. Of course, the blind trust would respect both the letter and the spirit of the law, although this raises questions in any case, because, at the end of his term, the minister can always put the assets back in his name.

There are some misgivings about blind trusts, but that would have at least complied with the spirit of the law. However, the minister decided to do something else, and that is why he is being asked today to apologize to the House. He put himself in a conflict of interest or in a situation strongly suggesting a conflict of interest.

If any ethics professors are looking for the perfect example of a situation that suggests a conflict of interest, I think this situation with the Minister of Finance is ideal.

The minister is still in control of his shares in a large Canadian company, Morneau Shepell. This company sometimes deals directly with the Government of Canada. In general, it specializes in pension administration.

The company's value even increased when the Minister of Finance, who still had control over his holdings, introduced a bill that was good for his company. We are not the ones who came up with the idea that Bill C-27 would benefit his company. He said so himself in 2013 that a bill like this could benefit his company and would be the ideal thing for the company's growth and positioning. He said that in 2013 when he was still part of the family business. We did not come up with the idea that he profited from this. We can simply look at the numbers and see that this was indeed the case. The market responded favourably when the bill was introduced even though it had not yet been passed.

As soon as the bill was introduced the markets responded favourably because investors felt that there was a potential for growth for Morneau Shepell.

The minister personally profited from the increased value in his company when he introduced the bill. Imagine what things would look like if the bill had passed.

The bill is still on the order paper, but it has not yet been passed. However, we can just imagine how much this company would profit from the bill passing.

Who benefits in the end?

The Minister of Finance does.

However, he finally gave in to the evidence and acknowledged his mistakes by changing his financial situation with the Conflict of Interest and Ethics Commissioner as a result of public pressure. He did not seem thrilled to do so. He had probably worked out some elaborate strategy to maintain control, but under pressure, the minister finally decided to change his situation.

He did so because he saw that he had no other choice.

I mused earlier about the minister and his lawyers before the Conflict of Interest and Ethics Commissioner, and I can also imagine another scenario, one where the Prime Minister called him and told him to sort this out or find another job.

I would say he did not have much choice. To suggest today that he did so willingly and because he wants to serve Canadians would be to take us for fools. I hope he apologizes so that we can turn the page on this once and for all.

[Sheila Malcolmson, NDP, Nanaimo—Ladysmith, BC]

Mr. Speaker, I would like to get my colleague's comment on this concern from my own riding of Nanaimo—Ladysmith. Amber Henderson, who is an optometrist in Nanaimo, wrote that the finance minister's proposal for so-called tax fairness being described as “an attempt to level the playing field and bring tax fairness to the system...is misleading and suggests that business owners have somehow been taking advantage of the system, rather than simply pursuing their taxes consistent with existing law.”

I would like my fellow New Democrat member of Parliament to comment on who he sees as the real exploiter of tax loopholes in the context of this debate and how in the member's own riding that apparent hypocrisy is playing among entrepreneurs.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I thank my colleague for her question. This could not come at a better time to expose the government's hypocrisy on this whole tax fiasco that they are creating.

The latest in this tax fiasco is the attack on diabetics, who no longer have access to a disability tax credit. At the same time, the Prime Minister and his Minister of Finance claim to want more tax fairness, yet these two politicians own numbered companies.

I have nothing against numbered companies. Optometrists in their ridings, like the one the member referred to, have legitimate businesses with names. They do not simply have numbers. I think this exposes the Liberals' total hypocrisy on this subject. They are talking about tax fairness, yet they are going after optometrists, in their very own ridings. Not to mention, they are benefiting from the tax system with their numbered companies.

The Prime Minister had a reason when he said during the campaign that the majority of SMEs were simply used to pay less tax. This was his own experience. While he travels across the country, he must realize that having a numbered company to pay less tax simply reflects his own situation.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Mr. Speaker, we know that the finance minister has announced a number of steps to address his ownership of shares and so forth.

In my riding of Vaughan—Woodbridge, I know that constituents are talking about our cut in the small-business tax rate from 10.5% to nine per cent and what we have done for the middle class through the CCB and our infrastructure program.

What are my colleague's constituents talking about? Those are the important things we need to focus on: growing our economy and making sure people have good jobs and a good future for their children.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

I thank my colleague for his question about what my constituents think and want.

Of course my constituents were pleased to hear that the government is finally going to keep its solemn promise to lower the small business tax rate to 9%. It is about time. The government has already wasted two years in which it could have made good on that promise. It dragged its feet. The small business tax rate was already set to drop under legislation passed by the Conservatives in 2015. It was set to drop to 9% in 2017. However, it is now 2017 and the tax rate is still at 10.5%. Business owners are obviously frustrated about this because the Liberals made a solemn promise. They are halfway through their term in office and they have to decide whether they will keep that promise.

My colleague seemed to imply in his question that there is no cause for concern regarding the finance minister's situation, but that is not so. Small business owners in my community are telling me how out of touch the Prime Minister and the finance minister are with the reality of SMEs. The Prime Minister and the finance minister do not seem to realize what an SME is or what everyday life is like for SMEs. That is what I am hearing. The Prime Minister and the finance minister are out of touch and simply do not understand. That is why they are making mistakes. The tax reform has been a fiasco because they do not know what an SME is. They do not understand. That is what I am hearing from my constituents.