Madam Speaker, this private member's bill addresses an issue that is of concern to the Minister of Industry and all ministers who are responsible for consumer affairs throughout the country.
I should advise the House that consumer ministers from across the country addressed this specific issue last Friday during their annual meeting in Charlottetown. The ministers committed themselves to working closely together in times of crisis so that allegations of price gouging and other unfair business practices may be freely and quickly exchanged among the various jurisdictions when natural disasters and other emergencies occur.
However, the ministers stopped short of agreeing to enact laws that would target all businesses whose prices rise during emergency situations. Let us examine the reason for that.
First of all, it is worth examining how serious the problem of profiteering during emergencies actually is. Are Canadian businesses systematically taking advantage of their customers' vulnerability during these times of crisis and charging them exorbitant prices for essential goods? That is the question.
The fact is, there is little concrete evidence to show that many businesses are conducting themselves in such a reprehensible manner.
Let us look at our most recent experiences.
During and in the immediate aftermath of the ice storm which affected Quebec, eastern Ontario and New Brunswick in January 1998, there were many reports in the media of alleged instances of price gouging. The Government of Canada and, in particular, the Minister of Industry took these allegations very seriously.
In response to these allegations, Industry Canada immediately commissioned Option Consommateurs, a respected Quebec based consumers' organization, to conduct an analysis of specific allegations of price gouging, especially with regard to generator sales.
It was found that very few merchants had charged what might be considered an excessive price for some products. Therefore, the first problem with the proposed legislation is that it would be killing a fly with a steamroller. When emergencies occur, verifiable cases of price gouging do not arise very often.
Discussions between officials in Industry Canada, with their consumer protection colleagues in Quebec, Ontario and Manitoba, have confirmed this observation.
In those few instances where price gouging appeared legitimately to be a problem during the January ice storm, the full glare of media coverage raised consumer awareness and worked as an effective antidote to reverse the position of merchants.
On the whole, however, most merchants who had been accused of profiteering from the ice storm were found to have raised their prices for very good reasons.
Working overtime to fill numerous orders for generators with very short notice, under unfavourable conditions, merchants were seeking generators from distant suppliers throughout other parts of Canada and the United States.
The demand for fast delivery, combined with unfavourable weather conditions meant that merchants' outlay to obtain products increased sharply. Merchants usually had no choice but to pass the cost on to their consumers. That is how the free market works.
If parliament should choose to interfere with the law of supply and demand, it could potentially make the situation for Canadians worse, not better, when disaster strikes. Merchants will fear that they may be exposed to enormous fines or even imprisonment for suddenly raising their prices.
Thus, they may refuse to go that extra mile for their customers. They may tell them that they will not look for a generator on such short notice because they would not be able to charge the real price and could risk an indictable offence. In this way Bill C-442 would prevent, not promote, access to goods.
Given that the problem has been shown to be a minor one and given that the proposed legislation could have the opposite effect it is intended to have, we must ask whether parliament is best suited to enact such legislation.
It is well settled law in this country that consumer protection is principally in the purview of the provincial and territorial governments.
As for the federal Competition Act, the statute prevents profiteering resulting from collusive agreements among competitors. It also prevents profiteering which is made possible by the making of misleading representations, in the form of false advertising for example. However, price volatility is largely a provincial matter.
The government believes it would be prudent to stay out of an area that is not its own and to allow the provinces to enact legislation, should they choose to do so.
Indeed, officials from provinces recently affected by natural disasters have expressed little interest in doing so. It would seem odd, then, that parliament should step in and set a consumer affairs policy for them.
By not supporting this bill the government is not forgetting its responsibility to the Canadian people in times of emergency. Indeed, in preparation for one of the most extreme emergency situations that we as a nation could possibly face, that of an international emergency, the Emergencies Act already provides for cabinet to make such orders or regulations with respect to the authorization and conduct of inquiries in relation to hoarding, overcharging, black marketing or fraudulent operations in respect of scarce commodities as the governor in council believes, on reasonable grounds, are necessary for dealing with the emergency.
In summary, the government believes that to go beyond these measures, to legislate against a problem that experience at both levels of government, federal and provincial, has shown to be very marginal, would constitute not only heavy-handed interference with the free market, but also an unreasonable intrusion into provincial and territorial consumer affairs.
I am totally surprised and personally disappointed to hear the member for Surrey Central, who on the one hand remarks that government should not be interfering in business, but who himself wants to interfere in business over the heads of the provinces.
