Madam Speaker, I am proud to rise today to speak to Bill C-396, an act to amend the Department of Industry Act regarding financial assistance. I was honoured to accept an invitation to speak to this private member's bill proposed by my colleague, the hon. member for Beauce, whom I proudly serve with on the Standing Committee on Industry, Science and Technology.
This bill is an important step toward ensuring accountability when taxpayer resources are used to subsidize private companies, whether through loans or other guarantees. The purpose of this bill is to ensure that companies that receive repayable financial assistance provide that information to the government so that it can be publicly shared with Canadians.
Currently, when the Canadian government subsidizes through repayable assistance, Canadians have little means of knowing whether those companies have repaid their loans to taxpayers. This lack of accountability means that the government can extend taxpayer resources with little oversight from parliamentarians and Canadians. This lack of transparency is a scandal waiting to happen. I believe this simple legislation can help ensure that resources are being spent in an appropriate manner so that Canadian taxpayers can have the confidence that they will be repaid.
Canadians' hard-earned tax dollars are being used to offer loans to corporations. Therefore, Canadians have a right to transparency on how those companies will pay the loans back. No bank would loan money to anyone without a reasonable expectation of return and a plan to have those funds repaid, yet all too often what starts off as a government loan very quickly becomes a government grant. If Canadian taxpayers are expected to get in the business of financing private ventures, every taxpayer, like a shareholder in any private company, deserves quarterly reports on how those resources are being spent.
One case in particular comes to mind when debating this issue: the repayable loan of $375 million over four years paid to Bombardier by the Liberal government. This payment may have been necessary to support a Canadian company, but surely taxpayers are owed accountability in terms of how these funds are being spent and how they will be repaid. When my hon. colleague from the Beauce asked the government for further information on the terms and conditions of this loan payment, he was denied that information. In effect, Canadians were denied the right to judge the government on its use of taxpayer resources.
Now let us look at what has changed since then. In the last two years, Bombardier's share price has significantly improved, more than doubling, and yet Canadians do not have the information to judge whether the investment in loans by the federal government was worth the cost. In fact, there has been considerable movement on this file, as the C Series jet, which the government spent hundreds of millions to invest in, was bought by European conglomerate Airbus, after struggling to reach sales targets. Jobs and investment have now left Canada, and facilities to construct these taxpayer-subsidized jets are being built in Alabama. Canadians deserve to know how companies that receive taxpayer funds will pay back those funds and how they will be using those funds.
The case of Bombardier is certainly not isolated. In fact, nearly 200 companies have received $700 million of taxpayer assistance, but other than that headline number, there is little accountability to taxpayers. How many jobs are these projects creating? How much are these investments stimulating our economy? When will those loans be repaid to the taxpayer? These are all good questions, questions that could be better answered should Bill C-396 be passed.
I want to take a second to recognize that government investment can be very necessary in limited circumstances. I think of the bailout of our auto industry during the last financial crisis, when the previous Conservative government invested in shares that provided value to taxpayers, saved jobs in Ontario and across Canada, and ensured that automotive investment stayed in Canada. Canadians have a right to information regarding these deals because an informed citizenry is essential to a healthy democracy.
I am proud of the work that my colleague, the hon. member for Beauce, did when he served as the industry minister in 2006 and 2007. He published information regarding these loans: the amount and the conditions for repayment. Due to this, many of the companies actually started repaying their loans due to public pressure.
I understand that there may be some worries about Canada's competitive advantage should this legislation pass. However, the principle of accountability must trump all other considerations. In fact, I believe that accountability is a foundational principle for all actions undertaken by government. If Canada demonstrates an increased level of openness and transparency, we can set an example for other nations. This accountability will ensure that government undertakes financial assistance activities that meet the appropriate threshold under international law, and that we can be certain that these will be good subsidies. This is an example that Canada should set, and the world should follow.
Many times Canadian companies, like Bombardier, are unfairly attacked by foreign competitors that receive subsidies from their respective governments. If Canada passes Bill C-396, we will be showing the world that we have nothing to hide when we provide financial assistance to our companies.
There are many cases where financial assistance to companies can even achieve legitimate policy ends. I think of the construction of railroads across our great nation that could not have been achieved without significant government support. There is no reason why this financial support cannot provide a net benefit to taxpayers.
For example, in May 2013, Sandvine Incorporated was given a loan of $9.5 million and later paid back $14 million. Not only were taxpayers given their money back, but the deal helped this company generate jobs and create economic value for Canadians.
We must always place as a priority, however, that governments are not driven by political consideration or emotion but instead by hard facts. Providing grants or so-called repayable loans to private companies should be absolutely the last resort. Instead, governments should seek to build the foundation that allows private investment to thrive in an environment that emphasizes free markets.
It is not the job of the government to pick winners and losers. If the Liberals have decided they want to pick winners with taxpayer money, the least they can do is provide transparency on how taxpayers will be repaid. This bill would create that transparency and would provide accountability for companies so they would be compelled to repay their loans, rather than hiding in the darkness of government secrecy.
I suspect the Liberal government will vote against this bill to provide greater transparency, which is a real shame. The Liberal Party campaigned on doing politics differently. Sadly, as soon as the dust settled after the election, we quickly realized it was business as usual with the same old Liberal Party. The train of pork emanating from the government is simply astounding. At a time of global economic expansion, foreign investment is leaving our country at a record pace and the Liberals are using taxpayer resources to try to stem the tide, unsuccessfully. The problem is that when the economy is growing, it is fairly easy to run deficits, but when the economy inevitably contracts, the taxpayer will be left on the hook for these loans.
During the last economic crisis, the Conservatives acted in the national interest and injected an unprecedented amount into our economy. We saved our auto industry and ensured our country became the first out of the G7 to come out of the recession. That is a record of which we can be proud.
Let us remember, however, that this fiscal flexibility was only possible because of decades of Liberal and Conservative fiscal prudence. That fiscal prudence balanced Canada's budget in 2015 and would have ensured that Canada would be well placed to weather future economic storms.
Unfortunately, the government has used these good economic times to expand spending at a rate that goes beyond sustainability. It is replacing private investment with taxpayer funds, but without the same oversight that investors in private companies can expect.
Bill C-396 is an important step. When Canadians get transparency and accountability, they can judge the government's actions. When decisions are made in a shrouded manner, it takes an extraordinary amount of effort by taxpayers and parliamentarians to get to the truth. The government counts on this lack of transparency to get away with giving repayable loans that are often or never repaid, loans which Canadians have a right to examine and question.
I strongly support Bill C-396. As accountability is the foundation of a free and democratic society, so too is the right of Canadians to examine and pass judgment on government assistance to private companies.