Eleni Bakopanos

[Textile Industry, December 14th, 2004]

Mr. Chair, I am very much aware that the major challenge facing the industry is preserving jobs. Today's announcement is specifically intended to help the industry keep jobs in Canada.

Without going into detail on the situation in Huntingdon, which the Bloc Québécois is using to get its point of view across, hon. members need to understand that somewhere in excess of 200 employers across Canada are delighted with this announcement. I have been working with representatives of both sectors for some time. Today's announcement reflects what they were asking us for and what was contained in the report of the Standing Committee on Finance.

I would, however, like to explain why I announced the two pilot projects. One of these is, in fact, in my riding of Ahuntsic, and the other in Laval. We want to demonstrate once again that over $300,000 has been injected into an existing program designed to find new ways of retraining workers who lose their jobs.

While the industry is becoming more and more high tech, the older workers are not getting the opportunity of new training, for a variety of reasons. Through two NGOs we are helping them find new jobs. Through this type of assistance we are able to help workers in the industry stay employed, and as well, through Emplois Québec and our provincial government counterparts, to ensure that those who do lose their jobs can train for others.

I want to point out that there are other reasons as well. As I have heard from entrepreneurs, the more our dollar rises, the more jobs are at risk. Businesses are less able to be competitive. This announcement provides them with the tools to become more competitive. We do not have total control over the value of the dollar. This is bad in one way and good in another. That said, a variety of tools need to be found for entrepreneurs and for workers, and the various types of worker need to be taken into consideration.

As hon. members have heard, POWA is a program I am in favour of. I have indicated my support of this to the minister and will continue to let him know that more funding and new projects are needed. I feel, however, that the two projects announced today will help some of these men and women.

[Textile Industry, December 14th, 2004]

Mr. Chair, it really is a pleasure for me to rise in this debate tonight on a subject that has been of interest to me ever since I came to this place. I have been working with the textile and apparel industry for a long time and have known the challenges faced by this industry as a result of free trade, of the initiatives taken by the government and of what is happening to the workers in this industry.

I would like to take the opportunity to offer some comments on a file that I have had occasion to work on for the last seven years. It is one that is increasingly challenging because of the global context in which this industry works, and the marketplace in which all nations now must compete.

My hon. colleagues are no doubt aware that this competition will even be fiercer in 2005 when all countries eliminate their quotas on the textile and apparel products, as agreed in 1994, further to negotiations held at the World Trade Organization. According to these obligations, Canada will have to eliminate all remaining quotas on textile and apparel products as of January 1, 2005.

To assist the Canadian textile and apparel producers in adjusting to this competitive trade environment, the government, as the minister announced in the House earlier, will remove tariffs on textile imports used in apparel production and on fibre and yarn imports.

Although this measure alone is expected to reduce input costs for both textile and apparel manufacturers by up to $90 million per year, it is important to note that duties will remain in force on products where domestically produced Canadian fibres, yarns and fabrics are available. The Canadian International Trade Tribunal will work in consultation with Canadian textile producers to identify the products that they manufacture.

May I say that they already have a list because there was a comment made by the opposition members that this will also be a long process but there is already a process that has begun and there is a list that has already been given actually to the international trade tribunal which will not take forever in order to establish a list.

Under this new framework, importers will have to pay transitional duties during the consultation process and until a final decision is reached on the imported inputs that will benefit from tariff relief. The importers will then be able to ask for a refund of duties paid after January 1, 2005.

Today's announcement will also provide an additional $50 million over five years to the textiles production efficiency initiative, CANtex, which was announced by the Minister of Industry.

CANtex was granted $26.7 million in February to assist Canadian textile manufacturing firms to become more competitive and take advantage of new market opportunities. The initiative builds on the $33 million Canadian apparel and textile industry program, which has funded in fact over 300 projects to assist apparel and textile companies in enhancing their productivity, lowering costs, improving efficiency and identifying new markets.

When hon. members in the opposition say that we have done nothing on this file, I would like to remind them that this is the type of money that has been invested by the government in that industry.

Currently, eligible projects under the CANtex program involve initiatives related to textile production activities, such as the implementation of textile production processes to increase productivity, the modification of existing production equipment, facilities to produce different textile products and the improvement of textile production capabilities to reduce costs.

Current eligible costs include: the studies undertaken to identify appropriate textile production efficiency initiatives and/or to assess market opportunities for new or different textile production capacity; studies directly related to the project; planning directly related to the project; consultant and professional fees directly related to the project; staff wages and salaries directly related to the project; and equipment installation, engineering, software and staff training costs directly related to the project.

An additional $50 million will help producers of textiles used in traditional garments adjust their production to other markets. This money will also help promote excellence in the production of technical, special and industrial textiles, and give them the flexibility they need to succeed in the increasingly integrated markets we have now. With the CANtex program, industries will be able to ask for refundable contributions of up to $3 million for various projects, including the procurement of equipment and material.

I have certain industries in my riding that I have visited. Now it is no longer the ladies or gentlemen at a sewing machine. It is very much less labour intensive than it used to be years ago, and more high tech. A lot of the owners tell me that those machines cost over a half a million U.S. dollars. This part of the initiative, where we will be also more flexible than in the old CANtex program, will be of assistance to those companies that want to go into buying equipment that makes them more competitive on the international level.

As hon. members are no doubt aware, duty remission orders were introduced in 1997-98 by the government as temporary measures to help textile and apparel firms adjust to a more competitive trade environment. Specifically, they gave certain companies in six textile and apparel subsectors the right to a remission of duties paid on certain imports. Benefits have averaged $30 million annually over the past three years to the industry. Again, I would like to remind the hon. members on the other side that this government was the one that put those duty remission orders in place.

Although the current orders were set to expire on December 31, today's announcement will extend those orders for another five years, but will now include a phase-out period over the final three years. Remission order benefits will decline to 75% of original levels in 2007, 50% in 2008 and 25% in 2009. They will expire entirely on December 31, 2009. This phase-out period will allow beneficiary firms the opportunity to adjust to the 2009 expiry date.

The measures announced today are in addition to the more than $70 million in federal assistance to the textile and apparel industries in the last few years.

Just one example of this targeted assistance will be the $10.9 million provided in June 2003 for the Canada Border Services Agency to counter the illegal transshipments of textile and apparel products, products that came after the LCD initiatives that this government introduced, and which I personally opposed because of the impact that it would have on the textile and apparel industry.

In February the government announced $26.7 million in tariff reductions to benefit the apparel industry.

Today's announcement on the elimination of tariffs on all imported fibre, yarn and textile imports that are not produced in Canada supercedes and, in my opinion, goes beyond the $26.7 million tariff relief initiative.

The finance minister, whom I would like to thank for taking into consideration various representations on both sides of the House, will ask the Canadian International Trade Tribunal to hold consultations with the textile industry in order to ascertain the kinds of fibre, threads and textiles made in Canada.

But this will not take a year, as was said in one press conference. There is already a list drawn up by the industry.

Because innovation and investment are key to the industry's future successes in the global trading environment and to its continuing contribution to the health of the Canadian economy, I would be remiss not to mention some of the steps the government has taken outside of the tariff framework that have contributed to the sector's dramatic rebirth as a competitive high tech innovator.

Given the mobility of investment capital globally, a competitive tax system is critical to fostering business investment in Canada. Investment supports economic growth and job creation. The Canadian textile and apparel industry has demonstrated clearly that with more and better equipment embodying the latest technology, workers are more productive. As I said earlier, I have seen that for myself.

Increased investment and higher labour productivity in turn lead to increased employment, higher wages and a higher standard of living. The importance of improving the competitiveness of the tax system has been underscored in recent years by reductions in corporate tax rates for many of our major trading partners, establishing a Canadian tax advantage for investments, jobs and growth.

As time is running out, without continuing on the subject of tax, which I think is an important component, I would like to say that I am a member of Parliament who represents a number of apparel and textile manufacturers. I have had the opportunity over the years to meet with the entrepreneurs in my riding to learn about the challenges they face. I believe that their concerns are legitimate. For this reason, I have been working along with my colleagues on the government benches, as well as the Prime Minister and all ministers concerned to ensure a viable future for this industry's entrepreneurs and workers. Today's announcement in my opinion will do just that.

Recently I had the opportunity to attend the general assembly of the Textiles Human Resources Council, an organization dedicated to ensuring that employees of the textile industry attain and maintain world class skills. This is an industry that we have been supporting through CED and also Industry Canada. They are doing innovative training and education, ranging from CD-ROMs to fully interactive computer courses.

The Textiles Human Resources Council has made every effort to ensure the continuous upgrading of the industry's workforce, knowledge and skills. The outcome has seen the evolution of the oldest manufacturing industries in Canada into highly modernized capital intensive industries, selling to over 150 industrial sectors.

In closing, I am very encouraged by the fact that the government has moved on recommendations made by the finance committee. I also want to highlight the fact that I made an announcement today on behalf of the Minister of Human Resources and Skills Development regarding the two workers' initiatives that were put in my riding and in Laval.

[Violence Against Women, December 10th, 2004]

Mr. Speaker, December 6 marked the National Day of Remembrance and Action on Violence Against Women. It was also the sad anniversary of the terrible massacre of 14 young women who lost their lives at the École Polytechnique in Montreal.

On this occasion, I want to congratulate agencies such as Bouclier d'Athéna, which provides family services specializing in intervention in domestic violence cases, as well as Arrêt-Source and Transit 24, agencies in my riding that provide help, support and companionship to women who are victims of violence.

Their work and dedication enable us to make progress in the fight against this scourge.

In our days and in today's society, violence against women still exists. Until we break this vicious cycle, every day will be December 6.

[Committees of the House, December 8th, 2004]

Mr. Speaker, I rise on a point of order. Earlier I referred to the riding of a certain member during question period. I would like to make a correction in terms of the blues. I referred to the hon. member for Simcoe—Grey, but I meant to refer to the hon. member for Port Moody—Westwood—Port Coquitlam. I apologize to the House.

[Points of Order, December 8th, 2004]

Mr. Speaker, I am referring to the question that was asked by the hon. member for Calgary--Nose Hill in particular, and also the questions that were asked by the hon. member for Simcoe--Grey.

[Points of Order, December 8th, 2004]

Mr. Speaker, I would ask the Chair to clarify two issues for me. Having occupied the chair and knowing that often there is too much back and forth, there are two issues that I feel I have to bring to the attention of the Chair.

The first issue is that certain hon. members on the opposition side, during a question in question period today, impugned motives. I understand the Standing Orders to indicate that we cannot, neither in the question nor the answer, impugn motives before an answer is given.

The second issue I would like to bring to the attention of the Speaker is the fact that there were questions asked today which should have been addressed, in my opinion, to a political party rather than a member of the House.

I would like some clarification on the two issues that I have raised.

[Supply, December 2nd, 2004]

Mr. Speaker,I sat through this debate. I listened carefully to the Bloc Quebecois' demands. However, I did not hear anything in the way of solutions. There were many critical remarks. In my opinion, those critics went very far, but I won't go there. We have already said that unfortunately the minister could not be at two places at the same time. However, he has already met with the community concerned.

I would like to ask a very direct question to the member who just spoke. He offered a solution that we already raised with the minister and regarding which he said in his speech that a number of measures had been introduced.

However, is there anything more than words that the member could offer as a practical solution—not criticism—regarding this important problem that this government and this minister in particular have really taken into consideration? I think all the members here in the House should agree that he has a good knowledge of this issue and that he has proven that a few measures have been introduced already. In fact, he also said in his speech—and we are going to repeat it for the benefit of Canadians listening to us—that there is still a lot of work to be done and that he is ready to do it, in cooperation with colleagues who are welcome to suggest solutions to this problem.

I am asking the member who just made what I consider a critical speech what concrete solution he can suggest.

[Committees of the House, November 30th, 2004]

Mr. Speaker, in the two minutes I have left, I will repeat that I am in support of the motion by the hon. member for Winnipeg Centre. I appreciate that we have all party support on this. Now we all have to work together, of course, to convince the Minister of Finance to do the right thing.

The issue of the employees, which other hon. members have raised today, has been of concern to me. As I said earlier, we introduced a program for older workers because we need to work with the provinces, for instance, and I will give one very specific example in my riding. Most of it is high tech now. This industry is not labour intensive but high tech, yet especially on the apparel side there are still newly arrived immigrants who are working in this industry.

We need to have two programs, then, one for those who can no longer be recycled. In my opinion, the PATA program introduced by this government has to be introduced earlier, as I have said. At the same time, as the industry becomes more high tech, we have to look at what other types of programs we are going to introduce for those workers who are newly arrived in this country and may not have the skills. I actually have raised this issue with the minister of labour of Quebec. We must have programs.

I will give members another example. In regard to the high tech part of it, a lot of the business people in my riding need trained personnel. There used to be one high tech program, especially in the needle trade. Unfortunately none of the students finishing high school and who may not want to go to professional schools are actually entering this program. We have to encourage this and work with the textile resource institute to get young people to actually find a future in this industry. It is nice to have these machines, but if no one can program them then there is no future.

What I want to say in the last few seconds I have left is that I have worked with this industry for a long time, as have the government, the Minister of Finance and the former ministers of finance. The reason the former minister of finance, now the Prime Minister, put in the seven year period in terms of the duty remission was to help this industry. We have to do the same thing again, in my opinion.

I also want to say that on November 22 I had the pleasure of announcing, along with the Minister responsible for the Economic Development Agency of Canada, the CANtex program to help the textile industry. There are things happening and there are things we have to do, but we have to do more. It has to be a multi-faceted approach.

It also has to be an approach to open new markets, as I said. In terms of what is going to be in front of the committee on international trade today, the apparel and textile industries will be presenting some recommendations to see how we can help those two industries find new markets for our products. We have very good and competitive products. In my opinion, we have to be more protectionist, like the Americans, of our industry and we have to encourage a north-south type of market, perhaps, instead of looking to Europe or Asia where we are not competitive at all.

We have to assist the ministers, especially the Minister of Human Resources and Skills Development, to reallocate new sources of funding for those senior workers who will lose their jobs because this industry is becoming more technologically advanced. At the same time, as I have said, we have to look at what other tools the industry needs in order for us to be able to assist it.

My time is up. I support the hon. member's motion. I will continue to work with my colleagues from the Beauce and Scarborough Centre and the minister involved.

[Committees of the House, November 30th, 2004]

Mr. Speaker, I will be supporting the motion also. I have had occasion to work with both of these industries. Although there is some competition between the two as far as government action is concerned, as the parliamentary secretary has said, the government has already taken several initiatives. We have not been sitting on our hands. I feel it is important to note that the government has acted.

It is, moreover, also true that I was opposed to the initiative for the developing countries. Not because I was opposed to the initiative, but I wanted to see measures in place to protect our workers as well.

I have a question for the parliamentary secretary. I do not think there is only the one solution to this problem, since there are several aspects to it. The government has some tools available as far as older workers are concerned. A program is already in place for them. I believe we all need to work together to encourage the minister to add a new older worker program. We know that there will be fewer workers in this industry, obviously, as the technology advances. This is an industry that is already high-tech.

I am aware that some of my colleagues have been active in this matter, particularly the hon. members for Scarborough Centre, Brome—Missisquoi and Beauce. When the latter was economic development minister, he invested a great deal to ensure that there was a program for these industries. In rural Quebec, as in other parts of Canada, these industries are the largest employers.

I have something to say to the parliamentary secretary. We have all worked together and we will continue to do so. The minister himself has provided an opportunity for a positive response to the recommendations of the Standing Committee on Finance. I believe we should provide workers with a new program for older workers, while continuing to develop new markets for this industry. Today, industry representatives are appearing before the Subcommittee on International Trade, Trade Disputes and Investment. They are there to confirm that they require assistance to seek new markets. It is also important to see that this moves forward more quickly.

This is not the only initiative; there must be a more comprehensive one as well. Thus, we must ensure, on an industry level, that we believe in this industry and in its future. I have always said that this industry has a future. Perhaps it will not be the same industry it was in the past, but it really does have a future. I think this House is unanimous in saying that we must give this industry some tools so it can continue to survive.

I would ask the question of whether there are other initiatives. The parliamentary secretary has spoken at length about the tax structure we have established, not only for this industry, but for a number of others. But should we go farther? My colleague was a member of the Standing Committee on Finance and heard what the industry representatives said. Are there other aspects we have not considered? There are the workers, the new markets, a different way of finding new tools. Are there other actions we ought to be taking?

[Excise Tax Act, November 26th, 2004]

Mr. Speaker, Bill C-259 proposes the repeal of the excise tax on jewellery. I am pleased to have the opportunity to respond to this proposal having worked with my colleague, the former parliamentary secretary to the minister of finance, as well as my colleagues on the finance committee and the Liberal caucus on this very important issue.

Jewellery and watch products are the only products that are subject to a hidden luxury tax. I agree with the Canadian Jewellers' Association, with which I have worked with for the last five years, including its former president, Mr. Pierre Akkelian, that the federal government is discriminating against this industry.

Some people believe that we are attempting to remove a luxury tax, yet this tax applies to inexpensive jewellery. Jewellery is not luxury. One in three households buy jewellery and the average household in Canada spends less than $130 annually, the hon. member said $170, on jewellery and watches. The average expenditure in fact for a female is actually $98 and for a male it is $36, according to statistics that were furnished by Ernst and Young.

Four million to five million households bought jewellery in 2001 and most of them are low and middle income households. Low and middle income households account for 50% of the sales of jewellery.

In my culture, being of Greek descent, we always buy jewellery for every newborn child. The grandmother tends to buy jewellery, under $100 normally, and gives this as a gift to the child. Looking at the statistics, it is very strange that we would in fact tax a wedding band that costs sometimes around $100 or $200, perhaps more, and we do not impose an excise tax on the wedding gown that costs maybe $1,000 or $2,000. So there is some incongruity in terms of our tax system.

A single mother, for instance, may buy a pearl necklace. It is important to keep in mind that it is not a luxury tax. It is in fact something that would help low and middle income families. As I said, in my culture, it is an automatic thing to do. We normally buy some jewellery for our children. The average receipt, even from a chain like Birks Canada, is under $400.

On the other hand, other true luxury items, and I have always pointed this out to both the present Minister of Finance and the former ministers of finance, such as yachts, expensive cars, designer clothing are all exempt from this tax. In my opinion this tax should be abolished.

As a starting point, I would note that this private member's bill is one of 15 such bills that have been tabled in the current session, each of which requests some form of tax relief in specific circumstances. The proposed measures cover a broad range of initiatives, such as the income tax treatment of adoption expenses, herbal remedies, and fees paid for participation in physical activity or amateur sport. I understand that additional private members' bills proposing tax relief are waiting to be tabled.

There can be little doubt that these proposals reflect genuine concerns about how Canadians interact with and are affected by the taxation system. At the same time, it must be recognized that each and every one of these proposals carries a cost to the fiscal framework. In fact, the 15 private members' bills amount to $2.5 billion per year.

In addition to the fiscal cost that is associated with these private members' bills, one must also consider the difficulties that they may pose for the integrity and robustness of the taxation system and fiscal framework that the government works under.

Taken in isolation, any one of the private members' bills may raise important issues and express intentions that deserve attention and investigation. I am already on the record that I agree with the removal of this tax.

What we should not lose sight of, however, is the cumulative effect that a series of such bills could have on the taxation system. Individual proposals, even those with a relatively modest fiscal cost, could result in an inequity vis-à-vis other taxpayers who would then need to have their circumstances reviewed. Proposals that are evaluated on a stand-alone basis may have unintended consequences or create difficult precedents. A series of such measures may well increase the complexity also of the taxation system or even create opportunities for tax avoidance and evasion, as the hon. member has stated.

On the basis of these considerations, I would suggest that a certain degree of caution is appropriate on the part of the government in terms of studying this bill lest the government lose sight of its longstanding commitment to fiscal responsibility. If there is something that we have come into government to do, it is fiscal responsibility.

One of the hallmarks of the annual budget process is the consultation that takes place with the government asking Canadians for their input to help determine the difficult choices that must be made among competing priorities. Every year, as the hon. member pointed out, the Canadian Jewellers' Association has come before the finance committee with at least two reports, if I am not mistaken because I am not a member, that have suggested that the government do remove this tax. Both the Liberal members and the chairs, who were Liberal, agreed and there was, I believe, all party agreement.

In its May 5, 2004 appearance before the finance committee, the Canadian Jewellers' Association reiterated its request for a repeal of this tax and raised several concerns about this tax. As the hon. member said, the act's $3 tax threshold suggests that the federal excise tax on jewellery is a remnant from a bygone era, something that was once considered a luxury but is no longer considered a luxury. It is the only remaining luxury tax still levied by the federal government

While taxes on alcohol and tobacco can be justified, rightly or wrongly, for health promotion reasons, there seems to be little justification for the excise tax on jewellery as a luxury tax, since other luxuries, as I mentioned earlier, do not face a similar tax. Furthermore, according to the association, because Canada's tax system largely moved away from excise taxes with the replacement of the complex manufacturers' sales tax with the more transparent GST, the CRA no longer has the ability to administer a tax as complex as the federal excise tax on jewellery.

In its presentation to the committee, the Department of Finance disagreed with the characterization of the federal excise tax on jewellery as a luxury tax, noting that “most jewellery sold in Canada is relatively inexpensive and purchased by average consumers”. The department agreed, however, with the Canadian Jewellers' Association that the tax favours imported jewellery over domestically manufactured jewellery and that deficiencies in the tax “make it prone to tax avoidance and evasion”. The department has agreed with everything that we have said so far. According to the department, if “the jewellery excise tax were not already in place, it is less than certain that Parliament would want to legislate one today”.

I would like to add a point that perhaps was not raised by the hon. member. The president of the World Jewellery Confederation, CIBJO, wrote to the Prime Minister and stated that Canada was the last remaining country to have a jewellery tax. Australia and Russia have removed it because of the diamond industry and we are the last remaining country with this tax. Canada cannot be competitive internationally because of this excise tax. As a member of Parliament, I have had the opportunity to make recommendations to the finance committee. The elimination of the jewellery excise tax is one of the issues that I have raised and supported.

To assist the government in its support for small business, following up on budget 2004, the Minister of Finance wrote to the chair of the finance committee asking that the committee take an active role in assessing the merits of a number of measures proposed to support business. The finance committee has recently delivered its second report dealing with excise duties and taxes as they affect vintners, small brewers and jewellers. The report from the committee recommends some form of tax relief for each of these three industries, including a recommendation to phase out the excise tax on jewellery over a five year period.

In delivering its report, the finance committee is mindful of the need to assess competing priorities and the fact that limited fiscal resources are available, but the committee is making a recommendation to the minister. The government supports small business and will continue to review measures to improve the environment for small business to succeed.

I note that the private member's bill also proposes to eliminate the excise tax on jewellery and makes particular note of Canada's role as a diamond producing nation. I want to put on the record that I agree with the hon. member's statement that Canada is a diamond producing nation and we must be competitive. We are known worldwide as having an exceptionally good diamond industry. I agree with his comments that we will continue to help, especially in aboriginal communities.

Mining exploration in Canada, including diamonds, should be supported by targeted income tax provisions designed to recognize the special operating environment of this capital intensive and high risk industry. Provisions include the write-off for capital costs and the carry forward of resource deductions. Exploration companies also derive considerable benefit from the ability to flow expenses that would not otherwise be claimable within the company to investors in flow through shares.

The government has taken several recent actions to improve the taxation of the resource sector. I will end by saying that I agree with the hon. member. Liberal members and other members of the finance committee have been supportive of the removal of this measure.