Madam Speaker, I rise today to address a matter that has again and again been brought to the attention of the members of this place, a matter that seems to have induced public anger as only a few other issues have been able to do.
Perhaps it would be more appropriate for me to say that I am on my feet today as a result of the constant public and media attention afforded to this topic.
The issue to which I refer is the matter of gasoline pricing and the factors that affect petroleum price setting in Canada.
I am pleased to lend my personal support to private member's Bill C-235 which is currently before us. On an historical note, this is not the first time this particular piece of legislation has been placed on the Order Paper. Bill C-235 was first introduced in the 35th Parliament in 1997 as Bill C-238. Unfortunately, the bill had not been fully considered when the House dissolved for last summer's election. As a continuation of that process, last October the member for Pickering—Ajax—Uxbridge reintroduced the aforementioned measures with the hope that we would now have the opportunity to fully debate them.
It would be inappropriate if I failed to acknowledge the tremendous initiative and leadership demonstrated on this matter by our colleague, the member for Pickering—Ajax—Uxbridge. Not only did this member commit to the establishment of the caucus committee on gasoline pricing, he also agreed to act as our chair.
As chair he was guaranteed long and irregular hours, a hectic travel schedule and an endless barrage of what was at times a hostile media assault. Without his determination and guidance I know that the so-called gas caucus would never have come to fruition.
Bill C-235 would establish a legislative basis for the enforcement of industry-wide fair pricing policies. I submit that the proposed measures would go a long way toward improving the industry's rapidly emerging anti-competitive atmosphere. However, these concrete and long overdue alterations also promise to have a profound trickle down effect at the pumps, a result that, especially with summer looming, I believe we can all applaud.
In an effort to promote fair pricing rather than just cheap pricing, Bill C-235 clearly establishes regulations for a manufacturer who sells a product at the retail level and one who sells either directly or through an affiliate while at the same time supplying the product to a customer who competes with the supplier at the retail level.
To simplify it, this bill would give the customer a fair opportunity to make a profit similar to that of the supplier, hence ending the practice known throughout the industry as predatory pricing.
In addition, this bill would also establish a policy of governance which would label any supplier who attempts to bully or coerce a customer in the establishment of retail marketing policy as one who has committed an anti-competitive act. That in a nutshell is what this bill aims to resolve.
Over the course of the past several months the Liberal caucus committee on gasoline pricing has extensively toured the country. During that time we conducted a comprehensive series of public hearings. Further to that, when in Ottawa we devoted a considerable portion of our efforts and time to direct consultations aimed at providing us with access to a wide cross-section of the opinions held by consumers, retailers, wholesalers and specialized interest groups.
Although the formal results of the aforementioned study will soon be put forward in a report, at this time I can say that one of the most common sentiments expressed to us was a sense of fear resulting from the rapidly depleting pool of competition within this industry.
The Department of Industry holds the primary responsibility for ensuring that the provisions of the Competition Act are enforced. Even though the department has in good faith conducted numerous investigations into specific case violations of the Competition Act, I fear that this would be similar to arming our currently active duty military personnel with only black powder muskets. In essence, the musket was at one time the most effective tool available to the police and military, however, that is no longer the case. It is not that the musket operates any differently today than it did 100 years ago, but because the situation around us has evolved so dramatically we need to develop new and innovative ways to deal with the new and innovative problems we are faced with today.
This analogy applies to the Competition Act more than most of us would care to admit. The Canadian oil industry looks very different today than it did only a few short years ago. This has occurred in part as a result of the aggressive tactics and the predatory pricing policies of the industry majors. The resulting instability has placed the smaller independently owned dealers in serious jeopardy of becoming a thing of the past.
One might wonder why parliament should concern itself with the loss of a private, small and independently owned business. The loss of one outlet, although not preferable, does not impact tremendously when viewed in the context of the grand scheme of things. However, when we start experiencing the loss of hundreds or even thousands of them, alarm bells should start ringing. The industry majors will freely admit that the little guy is their best single source of competition, the most effective method of keeping them honest. With that in mind would it not stand to reason that each time the market loses an independent that safeguard is weakened?
It is regretful that over the course of the last 20 years a disturbing trend has emerged within the industry. We are losing independently owned establishments left, right and centre. Some would argue this is a result of the reduced access to capital or any number of other factors that small businesses routinely face. I say the banks will not lend money because of the increasing risks involved, risks that are skyrocketing because of unfair competition within the market. The point is if we do not act immediately to rectify the problem, we run the risk of missing the boat on this issue. When the independents are gone they will be gone forever.
My point is very basic. The Competition Act as it exists today is not properly equipped to deal with the complicated issues being generated by this sector of our economy.
The oil industry is unlike any other area of commerce. As such, it requires highly specialized rules of governance, rules such as those contained in Bill C-235. Bill C-235 is not a blanket solution for all the regulatory problems that face us as legislators. However, it is an important first step. Later this month the committee will be formally releasing a comprehensive report that will include a synopsis of the problems that exist within the oil industry along with a series of potential solutions. We need to take the initiative and move forward with this step now if we are to prove to the public that we are committed to resolving this matter.
I recall the gas prices of last summer and how my constituency office was flooded with angry calls demanding that I do something to deal with the exorbitant and rapidly fluctuating pump price of gasoline. I could unfortunately do little to ease the concerns of my constituents as the Competition Act applies only in instances where there is collusion. It is an act that represents only a very small part of a much larger problem.
Since that time I have taken an active role as a member of the committee. In January I hosted a well attended public consultation session in my riding with the gasoline pricing committee. Further to that I have been on my feet in the House on several occasions to present constituent petitions asking the government to enact legislation that would require the oil companies to justify in writing to the Minister of Natural Resources the reasons for any substantial fluctuation in the pump price per litre.
I have said it before and I will say it again. If we opt for inaction then we opt for a continuation of the unfair, anti-competitive and highly unjustifiable pricing policies of this country's major oil companies. That is totally unacceptable to me and it is totally unacceptable to the constituents I represent. I want to clarify that I am not attempting to paint the majors as evil villains. I want to ensure adequate statutes are in place to ensure they are accountable to individuals who rely on them and their products.
In rural Canada as in many other sectors of this nation, public transportation is simply not available. Services are miles apart and therefore personal transportation is a necessity rather than a luxury. We would not stand for unwarranted and unexplained vacillation in the price of food, home rental costs, medicine or other basic essentials. Why have we accepted it with gasoline? We need to establish accountability.
I urge each of my colleagues to support Bill C-235. It is a good bill deserving of our support. I understand that pump prices are low right now, as low as they have been in months, but that is not the point. This bill is not demanding bargain basement prices. It is calling for fair prices. High or low is not necessarily the issue. Often as a result of predatory pricing extremely low prices cause the most difficulty for the aforementioned independents. Selling at less than the rack price allows the majors to undercut their competition, hence eliminating any recognizable profit margin. We are all aware of what profit loss means to a business.
A continuation of predatory prices is a prime example of short term gain for long term pain. Right now parliament has the ability to prevent a looming disaster. If we wait for all the competition to be eliminated from the market then what we have remaining is an uncontrollable monopoly that has the ability to unilaterally dictate the price and availability of one of the country's most essential commodities.
I reiterate my support and gratitude for the actions taken and proposed by the member for Pickering—Ajax—Uxbridge. I will be supporting this bill. I sincerely hope that each of my colleagues will be doing likewise.
