Mr. Speaker, I am happy to rise today to take part in the debate on Bill C-212, the private member's bill that talks about the criteria for user fees. I want to remind the House that this problem has been around a very long time. I will quote the auditor general from 1993 when he said:
We are concerned that Parliament cannot readily scrutinize the user fees established by contracts and other non-regulatory means. There does not exist a government-wide summary of the fees being charged, the revenues raised and the authorities under which they are established.
I submit that this was the reason that the member for Medicine Hat introduced a private member's bill on this same topic in 1997, Bill C-205. I know he intended that the private member's bill he introduced would be an opportunity to fulfill those concerns which were raised by the auditor general of the day.
I do not think anybody is against the idea of cost recovery. We certainly are not in the Canadian Alliance. In fact we think that user fees are a good way to go, but the user fees have to reflect the actual cost of doing business and they have to be established in coordination, conjunction and cooperation with the different groups that will be subject to them.
I think of the example in Alberta a few years ago where there was a fairly severe economic downturn. I know it was not only in Alberta but I know about it from being there at the time. The housing industry for example was devastated. I think it was as a result of the NEP at the time, where there was a massive raid by the federal government on the treasury of Alberta.
However the effect of that was a severe recession in Alberta but the bureaucracy of Alberta did not change. Although there were no homes being built during that period, the number of regulators remained the same. These people were supposed to be monitoring and giving authority to the housing industry on things like inspection on plumbing, heating and natural gas fitting in homes for example. As a matter of fact things got worse. The few people who were actually building houses in those years were subjected to harassment from all these bureaucrats who did not have anything to do. They had to justify their actions by going out and making somebody pay the price.
The reason I raise that example is that it is important to have a user fee system that is reflective of the situation in which the economy finds itself.
I know the member for Etobicoke North has raised a number of interesting areas and key points that need to be addressed. We agree with him, when he calls for the need for more parliamentary oversight when user fees are introduced or changed; the need for greater stakeholder participation in the fee setting process, which is part of what I just spoke about; the improved linkages between user fees, the federal department and agency performance specifications and standards; the requirement for more comprehensive stakeholder impact and competitiveness analysis when new user fees or fee increases are contemplated; the goal of increased transparency addressing these fees where applicable; the need for independent dispute resolution process; and the need for annual reporting outlining all user fees. Those are all very important aspects and we support the member in his request to have this changed.
However in addition to having parliamentary scrutiny on user fees, we submit the following principles should apply.
First, the fee must be based on the actual cost of providing the service. They are not necessarily set that way now unfortunately. Some fees are much higher than the cost of the service being provided.
Second, services must be cost effective. This is a key point. In many cases we believe the services are not being provided in a cost effective way and we have to ensure they are.
The member raised the point that there is $4 billion coming into the federal treasury in user fees. If that cost is reflective of the program that needs to be put in place to administer that in the way which has just been outlined so the different groups are not paying costs which are not their own or not inflated, then that is fine. However, in many cases we believe those costs are exaggerated, and it is another hidden tax on the industry itself.
Third, administrative costs must be low and the documentation requirements must be there in the operation of business.
Fourth, there should be no cross-subsidization of services for commodities or regions. That is an important point. We have seen too much of this kind of thing in the past. We have seen too many cases where there costs are borne by one area that should have been borne by another sector, another industry or another part of the country. Cross-subsidization should not be occur.
Fifth, wherever possible fees should be directly applied to prevent fee inflation to indirect application through the service provider.
Sixth, there must be a system in place for tracking the overall incidence of fees and the effect on industry with a process for consultation.
Simply put, we do not mind the idea of user fees or cost recovery. We think that is important. However the user fees must reflect what is a reasonable amount of cost recovery to actually do the job and should not bear out an over-inflated bureaucracy that does not adapt quickly to where that individual sector is itself.
In the case of the housing sector that I talked about, if it were the case that user fees had been set and the sector was in decline and it did not need that many staff to provide that service, that quickly would have to adapt. That means there would have to be consultation with the industry so that those user fees would be reflective of the current situation in terms of the economic well-being of that particular sector of the economy. Otherwise it becomes a cost that is too high and can affect their overall well-being and even competitiveness.
It is important to have a process that can quickly adapt. We believe that the member's bill, if adopted in its entirety, will do just that. We are supportive of it and wish him luck in furthering the cause of the auditor general from 1993, as well as furthering the cause of the member for Medicine Hat when he introduced his private member's bill. Perhaps this thing will move on. I think all parties in the House are in support of it. We would like to see the government pick this up and make it its own bill or pass this quickly to support our industry across the country.
It is important that these industries be allowed to function. We have a tough time already. Taxes are pretty high in the country. We have to compete internationally. Our productivity has fallen against that of the United States for about 25 years and we have to look at ways to cause that to change.
My party had some hearings across Ontario over the last few years. We were told that regulation was just as big a cost to businesses, especially small businesses, as taxation is. In fact it is disproportionately higher for small businesses because they do not have the people dedicated specifically to complying with regulation or people who are administering these cost recovery programs on them. Regulation is a huge cost. I think there were some studies done by the Fraser Institute that suggested it was a $100 billion cost to industry annually in Canada. That is a huge cost and it hurts them in terms of being competitive, and their bottom lines are affected.
It is important that we get this user fee regime right. This is a step in the right direction and I suggest that the members in the House should support this bill.
