Jerry Pickard

[Access To Information Act, December 1st, 1997]

Mr. Speaker, the bill before us in the House seeks to make all crown corporations subject to the Access to Information Act.

When the hon. member introduced his bill he mentioned that crown corporations such as Canada Post, among others, should be subject to the Access to Information Act in order to make them accountable. He also mentioned that crown corporations are exempt from the act even though they are subsidized by the taxpayers of Canada.

I found his comments very interesting because I have a special interest in Canada Post as the Parliamentary Secretary to Minister of Public Works and Government Services who happens to hold the responsibility for Canada Post.

I would therefore like to concentrate my remarks on the impact the proposed amendments would have on Canada Post Corporation. First, let me put to rest a fundamental misconception. I am happy to inform the hon. member that since 1988 Canada Post Corporation has not received a single cent of taxpayers' support.

How did it accomplish this impressive feat? It did it because of the direction provided by the Liberal government that created Canada Post Corporation back in 1981. I mentioned before in 1981 Canada Post was incorporated for the purpose of operating on a self-sustaining financial basis. As one of the few crown corporations under the Financial Administration Act, it is recognized that Canada Post operates in a competitive environment. It also is recognized by members on this side of the House that it is not dependent on the appropriations of the Canadian government.

The hon. member said that Canada Post Corporation needs to be open and accountable and I have to say that it is entirely that position this government supports. However, if one looks at the facts, one sees that it is already the case at Canada Post. One only has to read Canada Post's annual statement this year to see that the crown corporation is committed to these principles in both its operation and financial reporting.

Actually the front page of the report says “A Look Inside Our Business”. If the hon. member had taken time to read the report he would have noticed that Canada Post Corporation has its results on a segmented basis and includes an opinion from an independent auditor confirming Canada Post does not cross-subsidize competitive services with revenues from basic letter service.

The report also provides a detailed discussion of the financial results to the highest standard, that required of publicly listed companies. Canada Post is in fact far more open to public scrutiny than its competitors and that is because of this government's commitment to openness.

Since October 1, 1997 Canadians can count on an additional level of accountability at Canada Post with the appointment of a Canada Post ombudsman who will provide an independent avenue for customers whose issues or problems cannot be resolved through normal channels.

As I mentioned earlier, Canada Post has a commercial mandate. This mandate was reconfirmed recently when Canada Post underwent a review of its mandate. In its final response to the Canada Post mandate review, the government confirmed that the corporation requires a commercial mandate in order to ensure that Canadians enjoy a universal postal service.

The private sector competes with many of the services offered by Canada Post. Having financial objectives comparable to that of the private sector, Canada Post cannot successfully continue to meet its mandate if it cannot compete on a level playing field with its competitors.

A Federal Express spokesman appearing before a Canada Post mandate review committee in 1996 highlighted the concern that all companies operating in competitive markets have in regard to access to proprietary information. He said, “I would obviously love to see Canada Post's detailed financial information but I do not think it is fair because, should I see it, then our competitors ought to see mine”. I am in favour of fairness, but what the hon. member is proposing is obviously not fair. Even the Federal Express employee recognized this.

The government must have regard to public interest. In many of the markets in which Canada Post participates, it faces vigorous competition including that posed by large, well financed multinationals such as United Parcel Service and FedEx.

The requirement that Canada Post disclose costs, revenue, operational and consumer information would certainly create a very uneven playing field. Although I do not dispute the merits of accountability and openness in the sectors of the federal government, one must consider the impact of applying across the board disclosure rules to commercial crown corporations.

In this case Canada Post would be placed at a very obvious disadvantage with its competitors unable to collect information themselves but their competitors know all the competitive strategies enlisted by Canada Post. Under the disclosure environment being proposed, these competitors would be under no obligation to release their operational figures to Canada Post.

The reduced competitiveness of Canada Post resulting from compliance with the Access to Information Act would impact on Canada Post's ability to require self-sufficiency. This may in turn reduce the level of postal service to Canadians at a much higher cost to postal services.

Canadians deserve an affordable universal postal service. Despite the challenges posed by this country's size, low population density and extreme weather conditions, Canada Post has been able to provide a postal rate that continues to be among the lowest in the world. That is very good for Canadians and something we all should be proud of.

In conclusion, this government is committed to openness. The government is committed to accountability. However, the legislation before us would cause more harm to Canadians than good. It is not in the public interest and that is why I cannot support it.

[Canadian Wheat Board Act, November 20th, 1997]

Mr. Speaker, I find very interesting the position that the Reform Party has taken over whether an elected person from this House can speak about the western grain situation. I wonder if they would take the very same position if we talked about the auto pact, that no one from the west should be able to speak about the auto pact or no one from the west should be able to talk about other factors that affect this nation.

There is absolutely no question that Ontario produces a tremendous amount of grain. In my riding I would suggest to you that that grain is produced and the certificates from that grain have to be confirmed by the Canadian Wheat Board. The Canadian Wheat Board, without question, has a tremendous effect on the grain farmers in Ontario.

The new law now before Parliament is based on many months of consultation with farmers, including public hearings across the prairies. This proposed legislation embodies the biggest changes in western grain marketing in a half century. Throughout its history, the Canadian Wheat Board has been governed by a small group of commissioners appointed by the government and legally responsible only to the government. But in today's dynamic change in this marketplace the producers will have a clear voice in what will be happening. The producers will be accountable and the sales will be accountable to the producers.

Under the new law, it is the first time the Canadian Wheat Board will be run by a board of directors. There will be 15 directors in total and two-thirds of them, 10 of the 15 directors, will be directly elected by prairie farmers. They will take office at the earliest possible date in 1998 once the new law is passed by Parliament.

All the powers of the Canadian Wheat Board will be in the hands of the directors and because two-thirds of them will be elected, they will be directly accountable to producers for how they manage the Canadian Wheat Board's business.

In addition to the power to run the affairs of the Canadian Wheat Board, the directors will have specific authority to select their own chairperson; to set the salaries of directors, the chairperson and president; to review the performance of the president and to recommend his or her dismissal, if necessary.

To ensure farmers are getting value for their money, the directors will be legally entitled to have full disclosure of all facts and figures by the Canadian Wheat Board operations, including all financial audited statements. The directors will be able to examine the prices at which grain is sold, the price premiums achieved, all operating costs, and whether the wheat board is truly efficient.

Through these elected directors the Canadian Wheat Board will gain practical expertise in the real producers. If the directors are not satisfied with how the Canadian Wheat Board deals with the farmers or its sales strategy or the way it does business, they can make the necessary changes.

The new law will require the directors and officers of the Canadian Wheat Board to act honestly and in good faith, exercising all reasonable care and diligence. If they fail their duty, they will be exposed and have legal consequences.

Despite the structural changes, the Government of Canada will continue to provide the Canadian Wheat Board with financial guarantees. They will cover not only the initial payments set at the beginning of each pooling period and the Canadian Wheat Board's credit sales program but also all of the general borrowings. Since the Canadian Wheat Board is a multibillion dollar enterprise, the amount outstanding under these guarantees is very large.

For this reason, there is continuing need for the government to have a window on the Canadian Wheat Board in addition to the new accountability directly to farmers.

Such a window is also necessary because the Canadian exporter of wheat and barley, whether on the prairies or elsewhere, requires a Canadian Wheat Board export permit. This safeguarding of public interest will be achieved by the government appointing a minority of directors, five in total.

All of the directors, whether elected, the ten or five who are appointed, will have the same powers, duties and functions. The farmers will hold two thirds of that majority. The new law will put farmers in the driver's seat when it comes to any future changes in the Canadian Wheat Board.

If farmers want to remove some type of grain from the Canadian Wheat Board's current single desk system, that can be done subject to three conditions. The directors must make it a recommendation, the Canadian Grain Commission must approve an identity preservation system to protect the quality standards and, if proposed exclusion is significant to all the farmers, the farmers must vote for that approval.

If farmers want to add votes, rye, flax, canola to the Canadian Wheat Board's existing mandate, that too can be done subject to three conditions. The farm organization that represents the producers of that commodity must make a written request, the Canadian Wheat Board's directors must recommend it and there must be a vote among the farmers to approve it.

These new provisions are balanced and fair in both ways for either exclusions or inclusions. In either case, the authority is where it belongs, in the hands of themselves.

The Canadian Wheat Board is going to be more flexible. It will give to farmers more options in how they are paid and how their grain is moved through the system. It will make cash purchases of wheat and barley, increase initial payments quickly whenever market conditions warrant, close and pay out pool accounts at any time, provide an early pool and cash out option, fully use modern risk management tools, issue negotiable producer certificates, offset producers' grain storage and/or carrying costs, facilitate deliveries on condos' storage systems and receive grain through on-farm mobile elevators.

The Canadian Wheat Board is a very effective marketer of Canadian grain. It has the support of the majority of western farmers. They want realistic and sensible Canadian Wheat Board changes but they do not want a scenario that would lead inevitably to the board's destruction.

Just how valuable overall has the scheme of things been? It sells some $5 billion of grain per year at marketing costs of a few pennies per bushel. It retains no profit margin. All the rest goes to farmers. It is one of Canada's most significant business enterprises, doing business in more than 70 countries around the world.

It is our fifth largest exporter and our largest net earner for foreign exchange. It has earned, for itself and Canada, a positive reputation in the eyes of global customers. It is very important to the Canadian economy.

The board targets to extract maximum premiums but very important, the quality, cleanliness and consistency and our technical support are long-term, dependable, for the customer, the consumer from which we sell grain.

The Canadian Wheat Board has been rated as number one in the world.

These characteristics, coupled with the size of the board, its global reach and the market clout, result in Canada having roughly 20% of the share of the world market. The Government of Canada believes that it is worth preserving.

I am very pleased with the principles put forth in the bill. I am certain it will enhance our grain sales in the future.

[Income Tax Conventions Implementation Act, 1997, October 20th, 1997]

A fair tax is our policy. There are good reasons to believe that we have a system in place that has been very productive and has provided Canadians with a pretty good standard of living.

We move away from the point of looking at how taxes work. Taxes are paid but Canadians benefit greatly from the taxes we pay. Look at the seniors benefit, at the OAS benefits, at all the benefits we provide. We make certain that those tax dollars are spent wisely.

After seeing what it is like in other countries, I know in Canada we have the highest standard of living in the world. We have a good record of defending the weak, helping the sick, defending the poor, helping the seniors, helping the disabled. We have been world leaders in social policy. You cannot deny that, nor can anyone else.

Year after year the United Nations has pointed to Canada as being the best country in the world. All that comes about because of the policies that are put in place by governments in this country. We have run the country extremely well. When you can tell me any country that is better off than Canada, then you can preach the way you are. But until you can tell me a country that is better off than this country, I do not buy your argument.

[Income Tax Conventions Implementation Act, 1997, October 20th, 1997]

Mr. Speaker, it is interesting how the Reform Party member turns away from the real point when the issue gets a little straightforward and a little tough to deal with.

Does the member feel it is important that some Canadians get taxed at lower rates than other Canadians? Does he feel that it is fair that somebody, and we are talking of low income Canadians, works and receives social benefits in Canada at $10,000? The Liberal Party believes that one should be taxed the same as somebody who worked outside Canada and comes into Canada.

I believe that taxation should be fair and equal for equal incomes. I believe that we should make certain that this issue is not an issue of inappropriate change. It is an issue of bringing fairness to the system where some folks are taxed at very close to the same rate as other Canadians.

We are not talking about low income or high income. Low income Canadians under this bill will be the ones who pay no tax. Middle income Canadians will pay less than they paid before. The point is that all Canadians should pay approximately the same tax rate. There is no question but that Reform members missed that.

I wonder if they go back to their constituents and say “I argued the point that if John had a job in the United States he pays less tax than you, my neighbour next door”. Are you telling your neighbours next door that? If you are, listen to their answers.

The Reform Party is saying it wishes to tax Canadians who work outside Canada at a lower rate than those who work in Canada. I think that is wrong.

[Income Tax Conventions Implementation Act, 1997, October 20th, 1997]

Mr. Speaker, I am really surprised that a member of the Reform Party would stand and say that because a person has worked in a factory in Detroit they should pay less money than if they worked in a factory in Windsor. I am astonished at his viewpoint.

Fairness in taxation should be fairness for all Canadians, not a few. When we are talking about fairness in taxation there is absolutely no question that if we only charge taxes on 50% of the income, those folks who are only paying the tax on 50% of their income are being taxed less than every other Canadian. There is no logical reason for that to happen here in this country. When we talk about fairness it is not that we have changed the rate. Fairness is that all Canadians whether they earn their income in the United States, Great Britain, Canada or Germany, should pay their Canadian taxes in some equal and fair fashion.

The Reform Party is suggesting because we are putting up somebody's taxes a slight amount that it is not fair. That is incorrect. They did have a tremendous extra benefit that made no sense in Canada. We gave all of those folks who earned their income in the United States and came back to Canada their health care, medical care, the social benefits that they receive in Canada and at the same time we are asking them to pay approximately the same amount of taxes as all other Canadians.

I do not understand why the Reform Party would suggest that some Canadians pay less taxes than others on the same income. That is unfair.

[Income Tax Conventions Implementation Act, 1997, October 20th, 1997]

Mr. Speaker, it is a pleasure for me to speak to Bill C-10. It is a bill that is wrapped in fairness. There is absolutely no question that when people are treated in an unfair way that the unfairness be corrected.

Quite frankly, when the Canadian government examined what had happened in the tax agreements with the United States—by the way several other countries are involved in this tax agreement—in 1995-96, it realized there was an imbalance in the way Canadians paid taxes.

This is the background history to Bill C-10 and what the benefits will be. I would like to compare Canadians from 1984 onward who worked in the United States. Take for example security guards working in Michigan earning $20,000 and security guards working in the House of Commons. When these people added up their retirement benefits, those who worked in the United States had been given 50% of their benefits tax free, but those people who worked in Canada had to pay tax on 100% of their income.

It is a common thought by every one of us that if there is to be fairness, if each person earns $20,000 and is paid equal benefits, the taxation should be somewhat equal. It is very difficult to justify a 50% reduction for those Canadians who worked in the United States but who claimed their taxes in Canada where every other Canadian had to pay on the full 100% of their income.

Maybe I could explain the reason why that structure existed. The United States had a rule at that time that it would tax only 50% of social security benefits. It was able to say to all those who received benefits such as social security, family benefits or disability benefits it would only charge on 50%.

We have a totally different system in Canada. Our system says “For you folks who need that extra support, we will pay health care. We will pay the benefits that this country gives over and above a tax break in the dollars you receive”. Our structure was designed to make sure that Canadians got the basic services that they wanted. We look at the health care, the drug plans, the benefits that seniors have in this country. That is not the case in the United States.

However, as we go along with this process and as we looked at it we thought that in order to bring fairness we would write a tax treaty with the United States before 1996. In that change to the tax treaty what the finance minister tried to implement was a system where if you drew your benefits from the United States you would pay the normal United States taxation and if you drew your benefits from Canada you would pay the normal Canadian benefits.

The problem that occurred at that point was that the United States, rather than stay with that, charged all Canadians who were receiving social security benefits from the United States 25.5% taxation on those benefits and put a clause in stating that those taxes would be non-refundable. Even if under United States law they were not required to pay that much money, it still taxed them at a rate of 25.5%, which myself, all of the members in the Liberal caucus whom I talked to and the finance minister all agreed that the United States was being very unfair to Canadians.

Here is the scenario that the United States implemented. It was charging its own folks in their own country one rate, but Canadians working in that country were charged a higher rate. That was very unfair. They could not file to get the 25% back. If they were not supposed to be paying more than 10% they could not make a tax filing and get the 15% back. They were just taxed a flat rate of 25.5% which made it that Canadians who worked in the United States and received social security were being treated very badly.

The finance minister then looked at what was transpiring and said he would correct it. This is a result of a lot of negotiations with the United States and a lot of negotiations in Canada to try to come up with a policy which states that all Canadians will be taxed in a fair and just way and Americans who actually earn incomes here in Canada, the U.S. can tax them in a fair and just way. However, we do not want to see Canadians who work in the United States taxed unfairly.

The result was that Bill C-10 was negotiated with the United States over the last many months. We have worked on trying to correct those problems that were there and were being used in a very unfair way for taxation policy.

There are things that we did to try to correct that policy. That hardship of a 25.5% withholding tax in the United States on Canadians is totally eliminated. The unfairness of that system is gone. Canadians who earn social security in the United States will have that social security come back to Canada and here in Canada they will be taxed at the regular Canadian rates. What it really means is that instead of being overtaxed in the United States, all Canadians now will be taxed by the Canadian government and they will be taxed on the basis of fairness to all Canadians.

There is one slight benefit for those people who receive social security benefits in the United States and come back and are taxed in Canada. They will only be taxed on 85% of the income that they receive from the United States. In other words they are still a little bit better off than all other Canadians, but it is certainly a much more fair and just system that has been put in place.

The people who are hurt by this 25.5% rule that the United States put in were mainly those folks who earned less than $30,000. The lower your income in Canada by the time you take your benefits off and look at the portion of your income that you pay in taxes, it reduces. As your income is lower, so is your tax percentage lower. As a result we are trying to get a policy in place by C-10 that gives more fairness to low income Canadians.

The result of that move really makes a big difference with a lot of Canadians. Under the new rules several thousand Canadians will pay less taxes than they did before under the other agreement. In fact there will be several thousand Canadians who will not have to pay any taxes at all on that income. It is a real benefit for low income Canadians, particularly those who have an income of $30,000 or less.

Once this policy is approved by the Canadian Parliament and the U.S. Senate, Canadian authorities will be able to work to ensure that refunds are given to those who were overtaxed in these last two years. In other words Revenue Canada is going to take on the job of checking what they paid to the United States and what they should have paid under Canadian law and make certain that they get refunds. Those refund cheques will go out as soon as this bill becomes law.

The bill will become law when it is passed in Canada and in the United States. The sooner the bill is passed the sooner we will get fair treatment for lower income Canadians. That is why there is an urgency to move the bill ahead quickly now.

There is no question that for most residents of Canada, refunds will be handled by Revenue Canada. As a result they will not have to make application to the United States. We are trying to simplify the process as much as we can. Where those calculations show they receive money back, cheques will be sent to those residents by Revenue Canada as expediently as possible.

I also should point out that in some cases people with very high incomes would probably under the rules which exist have to pay more taxes in the last two years than they actually paid. We have agreed in that convention that no one, no Canadian will pay more than the U.S. government taxed them in the first place. No Canadian will pay more than they have already paid. Many Canadians will get a refund and will be better off. Those will primarily be low income Canadians. Not just seniors as was pointed out earlier, but also the disabled who have benefits coming from the U.S. and spouses who receive benefits from the United States will receive tax refunds as well. There are many avenues by which these benefits will be calculated and paid back.

When we really look at it, we have taken a tax law which in many ways may have been a loophole whereby some people were not paying anywhere near what others were paying in the tax system and with Bill C-10 we are bringing people to a fairness where all Canadians will be paying approximately the same in taxation. All Canadians will be treated fairly rather than unfairly. In the future no Canadians will be allowed to be overtaxed by a government not in this country. That is a really important issue. The Canadian government is taking back control of taxation for Canadians. That is another extremely important point that everyone should realize.

I have received several telephone calls from people about the tax rule. I had friends come to me and say that the tax agreement that has been struck with the United States is unfair. After talking with them about the unfairness of the tax agreement which was put in place in 1996, they all said the reason it was unfair is that it is taxing them in a disproportionate way to everybody else and it had to be corrected. It was mentioned earlier that there are large lobby groups that are very upset that Canadians were being treated unfairly by the U.S. government. Bill C-10 corrects that.

The faster we can get Bill C-10 passed through the House and the Canadian Senate and through the U.S. Senate, the quicker we can get fairness for all Canadians.

[Petitions, October 10th, 1997]

Mr. Speaker, I have a petition signed by several residents in my riding asking that the federal government work along with the provinces to upgrade the highway system in Canada.

[Supply, October 9th, 1997]

Mr. Speaker, Canadians can be proud of the best postal system in the world. They have some of the lowest postal rates in the world.

Canadians owe this, in part, to the competent management at Canada Post headed by Mr. George Clermont. Canadians also owe this to the Canadian postal employees who provide a very valuable contribution to the corporation.

The wages, benefits and working conditions of Canada Post employees are among the best in the country. The corporation has recognized their valuable contribution by extending an offer which proposes a reasonable wage increase above the standard reached in other industries this year. It offers 500 new full time jobs and above all maintains job security for those who have it now.

To maintain these jobs Canada Post must respond to the challenge presented by fax machines, satellites, courier companies and the Internet. It must respond by being efficient, flexible and progressive. This is what the present negotiations are all about.

Canada Post wants to negotiate with the Canadian Union of Postal Workers and it welcomes the labour minister's appointment of a conciliation commissioner. The government sincerely hopes that a negotiated settlement can be reached. A financially healthy business is the best way to protect the jobs of Canada Post employees, managers and workers alike.

Canadians can be proud to have a postal service that has not received taxpayer funding since 1988. As an independent, self-financing commercial crown corporation, Canada Post last year paid a dividend of $10 million to the federal government. This past fiscal year it returned a profit of more than $112 million and expects to remain profitable in the years to come.

As profits continue to grow, we can look forward to a very good postal system. The important message is that management and employees must work together to make sure the Canadian public is well served.

[Supply, October 9th, 1997]

Mr. Speaker, I listened with interest to my colleague across the way. I found some of what he was putting forward a little questionable. I too happen to have several documents which refer to contributions during elections.

It is rather interesting that the Canadian Air Line Pilots Association was a chief donator to the party across the way, the NDP. It protested the operations of Air Nova in Nova Scotia, and who happened to be the chief donator to the campaign for the leader of the NDP? It happened to be the union standing against Air Nova.

Let us look at United Steelworkers. Yes, indeed it is lovely. There is no question that United Steelworkers was a chief contributor to the NDP campaign.

Let us look at the United Auto Workers. NDP raised $3.8 million, mostly political donations. There is no question the NDP can claim that other parties receive donations, but it did not mention once its millions of dollars in donations. I wonder why. I wonder if it was just a slight memory lapse or if there was another reason that it missed all these huge donations.

Some folks in my family donated to the NDP, not because they wanted to but because they belonged to a union and the union took the money. These folks did not want it to go to the NDP. As a matter of fact they objected to that happening and yet—

[Canada Pension Plan Investment Board Act, October 7th, 1997]

Yes, Mr. Speaker. The hon. Minister of Finance had the foresight to move the issue forward and resolve the problem 20 years in advance.

On the other hand the Tories avoided solutions. They did not tackle the issue. We must make sure contributions match the payouts over any period of time. It is a closed fund. The only way it becomes sustainable is to make certain that contributions and payouts balance. If we cannot increase the contributions we cannot make the payouts. That is obvious. As soon as we cut the contributions we cut the payouts.

What is being proposed in the RRSP scenario is that those who have a lot of money to pay into RRSPs will be the benefactors of a pension in the future. Those who do not have the funds, those poor Canadians, are the ones who will end up without pensions. The rich get more and the poor get poorer. That is story being put forward by colleagues across from me today.