House of Commons Hansard #237 of the 42nd Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was finance.
The Speaker Liberal Geoff Regan
Pursuant to subsection 79.2(2) of the Parliament of Canada Act, it is my duty to present to the House a report from the parliamentary budget officer entitled “Analysis of Changes to the Taxation of Corporate Passive Investment Income”.
Dan Ruimy Liberal Pitt Meadows—Maple Ridge, BC
Mr. Speaker, I have the hon. to present, in both official languages, the eighth report of the Standing Committee on Industry, Science and Technology, entitled “Intellectual Property and Technology Transfer: Promoting Best Practices”. Pursuant to Standing Order 109, the committee requests that the government table a comprehensive response to the report.
Kevin Lamoureux LiberalParliamentary Secretary to the Leader of the Government in the House of Commons
Mr. Speaker, there have been discussions among the parties, and if you seek it, you will find unanimous consent for the following motion:
That, notwithstanding any Standing Order or usual practice of the House, on Monday, November 27, 2017, when debate concludes on the motion to refer Bill C-59 (An Act respecting national security matters) to committee before second reading, every question necessary to dispose of the said motion, shall be deemed put, and a recorded division deemed requested and deferred until the expiry of the time provided for Government Orders on that day.
The Speaker Liberal Geoff Regan
Does the hon. parliamentary secretary have the unanimous consent of the House to present the motion?
The Speaker Liberal Geoff Regan
The House has heard the terms of the motion, is it the pleasure of the House to adopt the motion?
Richard Cannings NDP South Okanagan—West Kootenay, BC
Mr. Speaker, I rise today to present two petitions from constituents in my riding of South Okanagan—West Kootenay, both relating to nuclear weapons. The first points out that 60 years after nuclear bombs devastated Hiroshima and Nagasaki, people around the world still very much desire a nuclear weapons-free world. Therefore, they call upon Parliament to enact legislation to make Canada an official nuclear weapons-free zone.
The second petition refers to depleted uranium weapons. Petitioners point out these are radioactively and chemically toxic on impact, and they have been used in recent wars. They call on Parliament to enact legislation banning the manufacture and stockpiling of these weapons in Canada, and forbidding Canadian Forces from using depleted uranium weapons in any of their actions.
Alistair MacGregor NDP Cowichan—Malahat—Langford, BC
Mr. Speaker, I have two petitions to present today on behalf of the wonderful constituents of Cowichan—Malahat—Langford.
In the first petition, petitioners recognize that in 2008, the House of Commons adopted a motion in support of the United Nations declaration on the rights of indigenous peoples, and that the truth and reconciliation commission has called on this in their calls for action. Therefore, the petitioners call upon the House of Commons to adopt Bill C-262, an act to ensure that the laws of Canada are in harmony with the United Nations Declaration on the Rights of Indigenous Peoples.
As evidenced by the sheer number—
The Speaker Liberal Geoff Regan
I would remind all members not to provide editorial comment or debate during this process.
Alistair MacGregor NDP Cowichan—Malahat—Langford, BC
Mr. Speaker, the second petition is on bees and pollinators. The sheer number of signatures is evidence of the importance my constituents attach to the issue. They recognize that honey bees contribute more than $2.2 billion to Canada's agricultural economy each year, and are very concerned with the collapse in hives and the health of bees. Therefore, they call upon the Government of Canada to take concrete steps to solve the problem of the high mortality rate among bees and other insect pollinators and to develop a strategy to address the multiple factors related to bee colony deaths.
As a small-scale farmer myself, I can very much attach importance to this message.
François Choquette NDP Drummond, QC
Mr. Speaker, it is an honour for me to present a petition signed by hundreds of students at École secondaire La Poudrière in Drummondville.
The petitioners state that, because Saudi Arabia has one of the world's worst human rights records, the government should cancel the $15-billion contract to sell light armoured vehicles to Saudi Arabia.
The petitioners are calling on the Government of Canada to end Canadian arms sales to countries that violate human rights.
Carol Hughes NDP Algoma—Manitoulin—Kapuskasing, ON
Mr. Speaker, I am pleased to rise one more time to table a petition with respect to eating disorders, such as anorexia and bulimia. It indicates that these types of illnesses have the highest mortality rate of all mental illnesses, that children as young as seven are diagnosed with eating disorders, that more than one million Canadians suffer, and that families have been negatively affected. It also indicates that the damage it causes can affect the brain; cause hair, skin, and bone mass loss; and cause the heart to shut down. It states that the first cause of death is cardiac arrest, and the second is suicide.
The petitioners are asking the Government of Canada to support Motion No. 117, which happens to be my motion. They are also asking the government to work with the provincial and territorial governments and all stakeholders to develop a comprehensive pan-Canadian strategy for eating disorders to include better prevention, diagnosis, treatment, support, and research.
I would add that the petitioners are from Penetanguishene, Penetang, Midland, Tiny, London, Kitchener, Guelph, and Cambridge.
Questions on the Order PaperRoutine Proceedings
November 23rd, 2017 / 10:10 a.m.
Winnipeg North Manitoba
Liberal
Kevin Lamoureux LiberalParliamentary Secretary to the Leader of the Government in the House of Commons
Mr. Speaker, I would ask that all questions be allowed to stand at this time.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Conservative
Pierre Poilievre Conservative Carleton, ON
moved:
That the House agree with the Prime Minister’s statement in the House on November 1, 2017, that “sunshine is the best disinfectant”; and call on the Finance Minister to reveal all assets he has bought, sold or held within all his private companies or trust funds since he became Finance Minister, to determine if his financial interests have conflicted with his public duties.
Mr. Speaker, we are called to this place to act in the public interest, to advantage the people we represent and not ourselves. No one has more power to advantage either himself or others than the Minister of Finance. He imposes taxation, tariffs, regulation, and subsidies. His department sells hundreds of billions of dollars of bonds on the market, which pay interest from Canadian taxpayers to lenders here and around the world. As the hon. member for Moose Jaw—Lake Centre—Lanigan, with whom I will be splitting my time, will point out later, those powers must always be carried out in the public interest.
There are two major dangers in allowing one man or woman to have so much financial power. The first is the danger of a conflict of interest, and the second is the misuse of privileged information. Let us begin with the first.
When any individual controls $330 billion of other people's money and regulates how businesses operate, then he or she can make decisions to favour companies or entities in which he or she has ownership. For example, the Minister of Finance was executive chairman of a billion-dollar pension administration company before he took his public duties. During that time, he advocated for a new hybrid model of pension called a “targeted benefit pension plan”. Those plans take from defined benefit plans and defined contribution plans, mix them together, and then provide people with a pension that has a benefit that is aspirational rather than locked in stone. In other words, the company would promise that it would try to deliver a certain benefit to future retirees who worked for the company, but acknowledge that market conditions may change, and therefore the benefit may also change with it.
These are highly technical, very specialized pension products, and very few companies offer them. I have had my research team scour the financial system and they have found that there are only three companies in Canada that have any specialization in offering these unique products. One of them is Morneau Shepell, the very company that the Minister of Finance helped create and for which he was the executive chairman. Up until only weeks ago, he had continuing interests of approximately $20 million in that very company. He then introduced a bill that would allow that company to provide these highly specialized financial products, or targeted benefit pension plans.
Let me be clear about the specificity as opposed to the generality of this particular initiative. Generally, he introduced a bill on pensions while owning shares in a pension company. Specifically, he introduced a unique financial product, which this company provides, through a bill in the House of Commons. Even more specifically, he used the unique model that exists only in New Brunswick as the prototype for the bill he would introduce here in the House of Commons.
Who helped unveil and design that model? It was Morneau Shepell. When? It was while the minister himself was the executive chairman of that very company. Therefore, this is not a matter of general application, but a matter of high specificity.
The law says that a minister of finance can advantage himself as long as he is advantaging everybody else at exactly the same time. When Jim Flaherty got a discount on a hockey stick at Canadian Tire, because he cut the GST, he was not in a conflict of interest, because anyone else could have saved two percentage points on a hockey stick, all 35 million Canadians.
This bill, by contrast, is so unique, so specialized and technical, that not only are there only about three companies in all of Canada that could provide the product created in the bill, but of those three, the one that had previously designed the product in question, and all the detailed contours of that product, was the minister's company, a company named after his family, a company in which his father is a board member, a company in which, until discovered, the minister himself held $20 million in shares. It is a highly specific, clear conflict of interest.
There is another issue, and that is the advanced use of privileged information. Ministers have the ability to make stock markets rise and fall, because they make announcements on regulation and taxation that influence and affect the markets. That is why we have to ensure that they do not make financial decisions of their own on buying and selling stocks, using that information before it is available to everyone else.
The basis of the free market system is that buyer and seller have at their disposal the same information so that neither has an unfair advantage over another. One might do a better job of researching or accessing that information, but as long as it is equally available, there is no problem. That is precisely why we have a tradition, a very carefully guarded tradition, that no market-moving information is to be introduced before the closing of the markets.
Typically, big announcements by government are made throughout the day, but not big market-moving announcements. They are made in the evening so that nobody can get the news, get online, and make a trade. That is how seriously we take the commitment that everyone in the marketplace is on the same, equal footing and that no one has an informational advantage over anyone else.
That informational advantage is not an academic question, because if the buyer knows more than the seller, or the seller knows more than the buyer, the person who has the advance knowledge is actually, in a strange way, robbing the person with whom he or she is carrying out the transaction.
If John knows more than Jim because of this privileged information, and John sells stocks to Jim on the basis of that privileged information, he may, for example, get a better price than he would have if Jim knew what was really going on, so Jim is shortchanged, because he has to pay more than he would have paid if he had had the same information as John. That is why John and Jim and Bill and everyone else should know exactly the same things when they agree to the voluntary exchange of securities in the stock market.
That latter danger, the danger of allowing some to have privileged information over the rest of the marketplace, has been an under-explored aspect of the finance minister's personal controversy, one we will explore in greater detail, and one way to explore it is by opening up his books.
The minister has a vast array of numbered companies and trust funds in which he has assets, which he has not revealed, that he held over two years while making important decisions that could enrich himself at everyone else's expense. If he has nothing to hide, he will stand today with us in the House and support the motion. He will tell Canadians everything he has owned, both personally and through these companies, so that all of us can judge his conduct and ensure that he has always acted in the public interest and not in his private interest.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Winnipeg North Manitoba
Liberal
Kevin Lamoureux LiberalParliamentary Secretary to the Leader of the Government in the House of Commons
Mr. Speaker, former prime minister Stephen Harper affirmed the Ethics Commissioner and the role she played. In fact, the rules this government is operating under are identical to the rules the Conservatives operated under when they were in government.
The other thing that is worthy of noting is that this particular minister has been under attack virtually since day one as he has provided many wonderful initiatives for Canada's middle class. I will have the opportunity to expand on some of those initiatives.
The office of the commissioner is independent. We have a joint opposition across the way that continuously wants to attack the character of the Minister of Finance. Since day one, the opposition has been after the Minister of Finance, and he has done exactly what other ministers, including ministers under the Harper government, did.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Conservative
Pierre Poilievre Conservative Carleton, ON
Mr. Speaker, the member's logic is that because the minister has done so many wonderful things, he does not have to be accountable to Canadians. I would question the pretext of his argument.
I am not going to concede that the minister has done any wonderful things for anybody other than himself. If that member disagrees with me, he will vote for the motion, because if he believes that this minister has acted with unimpeachable integrity, he will throw open the blinds and let in the sunshine, which the Prime Minister has called the greatest disinfectant. He will let all eyes see what there is inside and behind those blinds.
I will conclude by saying this. The member continually says, no problem, the minister has filed everything in a secret report to the Ethics Commissioner. The Ethics Commissioner works for the House of Commons. Let us be clear; so does the minister. In our parliamentary system, we are all accountable to Parliament, not to a bureaucrat or an official somewhere in the apparatus of the government. We are accountable to this place, because this is the place that is elected by the Canadian people, and it is in this place he should be.
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Mr. Speaker, I extend my colleague's comments to say that we are accountable to the people who sent us here, specifically on the promises we made to them during the election and since.
The Prime Minister made a commitment, as did all of his cabinet ministers, that their personal holdings would bear the fullest public scrutiny. That is from the Prime Minister's letter to his cabinet ministers.
We only found out about the Morneau Shepell shares that were still being held and controlled, and not in a blind trust, and not sold, because journalists at The Globe and Mail dug until they found them. It was not the finance minister, for all his great character, which my friend from Winnipeg talks about, who came to Canadians and said, “By the way, I know I let it be known that my affairs have been placed in a blind trust.” The Liberals repeated that line ad nauseam. Morneau Shepell believed that as well. That turned out to be a lie.
A question of trust and confidence in a finance minister is pivotal, because he or she is such a powerful figure. As the ethics code sits right now, which this minister apparently, allegedly followed, there is a distinction between whether shares are held in direct control or are placed in a numbered company wholly owned by an individual and wholly benefiting that individual. The ethics code right now makes a distinction between those two situations, whereas a Canadian will look at that and say, “If the money is going to the same person wholly, what is the difference?”
I am wondering if my friend can comment on this loophole that may have been exploited by the finance minister to relieve himself of any alleged conflict of interest.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Conservative
Pierre Poilievre Conservative Carleton, ON
Mr. Speaker, when I was a teenager, I worked at Telus. I was in the collections department. I will tell members that when one calls people to collect on their phone bills, and they are in business, the nicest people in the world on the other end of the line are the people who are paying their bills to keep their phone service intact. As a result of this, as a teenager earning about 12 bucks an hour, I got to own some shares in Telus. I got a little certificate, and I kept it as a keepsake. It was worth about 70 bucks when I left.
I came to Parliament, got elected, and the Ethics Commissioner said that I could not even keep that little certificate worth 70 bucks. I had to go to a bank teller and sell it, because there might be a conflict of interest if I did not.
It was 70 bucks, yet the minister had $20 million in shares while he was in charge of our financial markets and regulating the very company in which he had invested. This was an obvious conflict of interest. He should have known better. He should not blame the law or the Ethics Commissioner for his failed judgment.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Conservative
Tom Lukiwski Conservative Moose Jaw—Lake Centre—Lanigan, SK
Mr. Speaker, I have always been of the belief that every person, from the moment they first achieve cognitive thought, knows the difference between right and wrong, everyone except, it appears, this Minister of Finance. The finance minister has been involved in so many ethical transgressions in the last two years that I honestly believe it would be fair to say that I do not know if he understands the difference between right and wrong. If he does, it appears that he simply does not care.
For the benefit of the House and the benefit of those who may be watching today, I am going to enumerate some of these transgressions and what they mean in today's Parliament, what they mean to Canadians, and what they mean to those who may find themselves in a real or apparent conflict of interest.
We first found out a few months ago that the Minister of Finance had failed to sufficiently disclose all of his assets to the Ethics Commissioner. In fact, he failed to disclose a very significant asset. What was that asset? That asset was a villa in the region of Provence, in the south of France. I am not really that knowledgeable about real estate, but I would assume that a villa in that region, a very wealthy part of France, is probably worth in the millions of dollars.
Going back just a little, I should point out that all parliamentarians, since 2004, have been required, and are still required, on a yearly basis, to disclose to the Ethics Commissioner all of our assets and liabilities, and in fact the assets and liabilities of our spouses and family members. For example, if a member owns a house, what is its relative value? Does it have a mortgage? Does the member own mutual funds, stocks, bonds, or trust funds? Does the member own real property? Members report that to the Ethics Commissioner each and every year so that she will be able to determine if there is any perceived or real conflict of interest or if there could be a potential conflict of interest. Did the Minister of Finance do that? No. He failed to disclose a a million-dollar-plus asset owned by a private corporation, which he controlled. Could that potentially be a conflict of interest? Most certainly it could.
However, when queried by the media as to why he did not disclose this to the Ethics Commissioner appropriately and on time, he merely stated that it was an administrative error. I do not know about other members, but to me, making a million-dollar omission on a disclosure to the Ethics Commissioner is much more than an administrative error.
That was the first, but certainly not the last, of these ethical lapses we have seen from the Minister of Finance. We next learned, through a report first published in The Globe and Mail, that the minister was the owner of a private corporation, a numbered company in fact, in Alberta. We also found out that this numbered company had assets. Specifically, it owned approximately $20 million in shares in a company called Morneau Shepell.
As my colleague from Carleton pointed out just a few moments ago, that is the same company the current Minister of Finance used to run, a family-founded, family-run, very successful company that specializes in pensions and pension products. That alone should have raised a lot of alarm bells, but it gets even worse.
We later found out, again from The Globe and Mail, that the minister had not placed these assets, the approximately $20 million in shares, in a blind trust. He had, however, implied, to many people, including his colleagues on the government side of the House, that he had placed all his assets in a blind trust. He had told his former colleagues and former co-workers at Morneau Shepell that he had placed his assets in a blind trust. He had not. That was a clear conflict of interest and a clear violation of the ethics code.
In addition to that, at the same time as he was benefiting from shares in a numbered company which he had not disclosed, he introduced Bill C-27 in this place, a bill sponsored by the minister and brought forward by the minister, that would, in effect, if passed into legislation, allow employers to change their pension plans from defined benefit plans to targeted benefit plans.
I will not get into the details or nuances of the differences between those two pension plans. Suffice it to say, the minister, through his numbered company in Alberta, saw the share price rise, approximately $5 million worth. In other words, because it was not in a blind trust and still directly controlled by the minister through his numbered company, he and his family benefited to the tune of $5 million. Once he introduced Bill C-27, the speculation in the stock market was that Morneau Shepell would be gathering and garnering much more business across Canada due to it being the largest firm in Canada specializing in these products.
It was only after all of these revelations came to light did the minister determine he should sell his assets and place any other assets into a blind trust. That is akin to somebody saying “I'm sorry” after getting caught. In fact, I received an email from one of my constituents after the story came to light, in which he said that it reminded him of a bank robber who got caught a couple of years later, promised to pay the money back to the bank, then went on to say no harm, no foul, that everyone could move on because there was nothing to see. It does not work that way. One has to be accountable for one's actions.
The very definition of “conflict of interest” determines quite clearly that the Minister of Finance was, for two solid years, in a serious conflict of interest.
I go back to my opening comments. I am not sure if the minister truly understands the difference between right and wrong, but today we are giving the minister an opportunity to do what is right. To do what is right means simply this: disclosing all of the minister's assets he currently holds in numbered companies. Why is that important? Because having assets in a number company means Canadians do not know what those assets are.
What could they be? Let us assume for a moment that some of those assets are shares in, let us say, Bombardier. Would that be a conflict of interest? Clearly, it would. What would happen if some of the shares in those numbered companies owned by the Minister of Finance are shares in a company like Irving Shipbuilding or Davie shipbuilding? What happens if those shares, which we do not know about in these numbered companies, were shares in a medicinal marijuana company that is coming onto the market? There are so many things that could be conflicts of interest that we do not know about that the minister must reveal the sources of those assets, if only to gain, or regain, the confidence of the Canadian public and to prove to it that he is not in a conflict of interest.
By refusing to reveal the assets in these numbered companies, all he is doing is reinforcing in the public's mind that he is like every other dirty politician out for personal benefit and not for the public interest.
I call upon the minister to simply do what is right, and that is to reveal the assets, open the books, and let the Canadian public see what he has been hiding for these last two years.
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Waterloo Ontario
Liberal
Bardish Chagger LiberalLeader of the Government in the House of Commons and Minister of Small Business and Tourism
Mr. Speaker, I am sure the member knows very well, as Canadians should know, that there is a process in this place and there are independent officers of Parliament. Independent officers of Parliament have a responsibility to ensure that members of Parliament are in compliance and also that the partisanship of this place is not reflected in that work so we can serve in the best interests of Canadians.
Does the hon. member agree that the independent officer of Parliament has the responsibility to know the information that the Minister of Finance has disclosed, that she is more than capable of doing her job, and that we should let her do her job?
Opposition Motion—Finance Minister's assetsBusiness of SupplyGovernment Orders
Conservative
Tom Lukiwski Conservative Moose Jaw—Lake Centre—Lanigan, SK
Mr. Speaker, the member talks about the roles and responsibilities of the Ethics Commissioner. It is the ethics of the finance minister that are under question, not the motives or the ethics of the commissioner.
For two years, the minister basically deceived the Ethics Commissioner by refusing to reveal that his assets in a numbered company in Alberta were not held in a blind trust. It was only after an investigative story appeared in the media that the Ethics Commissioner became aware of that.
If the minister truly wanted to be forthcoming and if the minister truly believed in proactive disclosure, he would have informed the Ethics Commissioner at the outset of his time in Parliament. He chose not to do so. That was a decision made by the finance minister to deceive the Ethics Commissioner and that is intolerable and unconscionable. Quite frankly, the minister should be ashamed of his actions.