Don Boudria

[Pharmaceutical Sales, October 6th, 2005]

Mr. Speaker, a pharmacist in Ontario, who was apparently also operating an Internet pharmacy, was recently charged with selling counterfeit medications. In the meantime, another pharmacist was charged with selling bogus heart medication, which resulted in several deaths.

I want to know what the Minister of Health intends to do to protect the reputation of our pharmacists and the pharmaceutical industry, but most of all, the health of Canadians.

[Petitions, October 5th, 2005]

Madam Speaker, I have another petition signed by many Canadians. The petitioners ask that the Canada Health Act and corresponding regulations be amended to include IBI therapy for children with autism spectrum disorders.

[Petitions, October 5th, 2005]

Madam Speaker, I am pleased to present a petition from a group of constituents from my riding. It deals with the same issue raised earlier by the member for Guelph regarding amendments to section 83 of the Criminal Code of Canada to provide for an exemption for martial arts sanctioned by provincial boards.

[Textile Industry, October 5th, 2005]

Mr. Speaker, the textile industry, particularly in eastern Ontario and Quebec, has been hard hit by the increasing presence on Canadian markets of textiles from other countries. The industry is calling for a program to lower tariffs on clothing manufactured abroad with Canadian textiles.

Does the government intend to announce such a program in the near future?

[Wage Earner Protection Program Act, September 29th, 2005]

Mr. Speaker, I agree entirely. I do not know if I am going to commit a faux pas in the eyes of some, but in my view, we should be protecting even more than accrued unpaid wages, which are in fact previously accrued assets. At some point in the case of insolvency, if someone is a worker, he or she can decide not to provide services any more, but a worker cannot withdraw past contributions.

In my view, the threshold is even more important when it is a matter of contributions to a retirement fund or any previous contribution at all. These are accrued assets, and the way things stand now, the conditions cannot be changed by the worker.

At most, employees can say that since the employer is not paying anymore, they are leaving right away. This is technically possible when such a situation arises. However, nothing can be done to change a previously established condition, in particular one related to contributions made to a retirement fund 17 years earlier. This can no longer be changed.

That is why the protection in this regard should probably be increased to better shield these kinds of assets, if I can call them such.

[Wage Earner Protection Program Act, September 29th, 2005]

Mr. Speaker, I am pleased to have the opportunity to speak to the second reading of Bill C-55, an act to establish the wage earner protection program act and to amend the Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act.

As members know, insolvency laws cover both personal and commercial situations. For my part, I will be focusing these comments on the commercial side of Bill C-55. In particular, I will be addressing those amendments which deal with commercial reorganizations. I would, however, first like to elaborate on the importance of our insolvency laws.

Data from the Office of the Superintendent of Bankruptcy illustrates the extent to which businesses experienced financial difficulties. In 2004, notwithstanding the tremendous health of our economy thanks to the excellent government we have, notwithstanding that, there were still some 8,200 businesses that filed for bankruptcy for various reasons. These firms had approximately $800 million in assets and over $3 billion in liabilities. As we can see, there were, at least in some situations, a lot more liabilities than there were belongings.

Unfortunately, there is no detailed statistical breakdown on the Companies' Creditors Arrangement Act cases, as there has not been a central registry. However, it is estimated that there are more than 50 cases under the Companies' Creditors Arrangement Act each and every year. It is generally accepted that the restructuring of major companies take place under the CCAA rather than the Bankruptcy and Insolvency Act. One of the goals of Bill C-55 is the creation of a central registry for the Companies' Creditors Arrangement Act cases within the Office of the Superintendent of Bankruptcy, which would enable statistical and other analysis of the restructuring process.

Canada's economy is a market economy based on entrepreneurship and risk taking. As we all know, risk taking is integral to the functioning of the marketplace and it is fundamental to success in a market based economy. This is particularly the case with today's increased global competition.

Risk taking also helps to ensure that Canada's prosperity is maintained and continues to move forward. In other words, risk taking is the essential ingredient of economic growth and jobs. When risk taking is promoted and encouraged, by definition there will be failures. If there were not failures, there would not have been a risk. There are many successes, but some failures, unfortunately. Supporting risk taking behaviour, because of the prosperity it brings, also means that our laws must deal with the cost of these failures, however unfortunate they are.

From this perspective, the obvious role for bankruptcy and insolvency laws is to provide the legislative framework by which non-viable firms are liquidated and dissolved. In these situations, the business assets are sold off, the business closes its doors and, unfortunately, employees lose their jobs. The situation is almost always devastating for those involved. Jobs are lost. Small communities and single-industry towns are faced with decreased economic activity and prospects, not to forget the principals in the companies, who have invested sometimes everything they had, and who also sometimes lose their life savings in the failure of the business in question. They should not be forgotten in all of this either.

However, bankruptcy and insolvency laws provide a framework to permit and facilitate potentially viable but financially distressed firms to survive and hopefully to continue to operate. They should allow and encourage the financial restructuring of firms which have a reasonable expectation to return to financial health but which at the present moment are not capable of meeting their current obligations.

Bill C-55 makes many improvements that promote restructuring. These changes are necessary and indeed critical to improving the reorganizational provisions in both the Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act.

Interim financing, while not explicitly covered in the current legislation, is a critical issue for reorganizing companies. This short term financing allows a company to continue to operate while finalizing its restructuring. Courts have permitted interim financing but have done so on a case by case basis.

Bill C-55 would add both the Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act ground rules for the granting of interim financing.

By providing factors to be considered directly within the legislation, the parties involved would be better able to understand when and under what circumstances the court will grant interim financing. These new rules would provide a much greater degree of predictability and should help companies obtain the financing needed during the critical restructuring period.

The proposed amendments would also allow a restructuring company to terminate certain agreements where it is necessary for the viability of its restructuring process and would not be overly injurious to the other party to the agreement. This amendment would make it easier for companies to escape economically damaging contracts while providing the other parties to the agreement with a right to claim damages caused by the disclaimer. This amendment would ensure greater clarity in the process and would create a more orderly process for disclaiming contracts and ensuring successful reorganization plans.

Collective agreements, however, do not fall into the group of contracts that can be disclaimed by debtors. These agreements will remain in force until the parties agree to change them. Bill C-55 would create a process that would allow the parties to negotiate but would not force workers to make concessions.

The bill would also make changes to the role of key participants in the insolvency process. Interim receivers would be just that, interim. Limits on their power and on the term of their appointment would mean that they would no longer be allowed to operate for extended periods of time.

To cover the gap, we are creating a national receiver that would be able to operate in any province. The bill would also clarify the role of the monitor in a Companies' Creditors Arrangement Act case, ensuring that the monitor would be a qualified trustee, acting in accordance with the code of conduct and responsibilities placed upon trustees under the Bankruptcy and Insolvency Act.

The changes would also improve the transparency of the process by establishing clear rules regarding notice to creditors and by providing that payment of the third party costs may be paid out of the debtors' assets to allow all key parties to effectively participate. It would also allow courts to remove directors who unreasonably impair the restructuring process and it would allow them to make orders indemnifying the directors from liability.

The proposed legislation also contains amendments to the provisions governing international insolvency. Bill C-55 adopts the United Nations Commission on International Trade Law, or UNCITRAL model laws, for dealing with cross-border insolvency and should facilitate cooperation with foreign jurisdictions.

Our largest trading partner, the United States, recently approved the adoption of the same model. Therefore, standardized rules governing international insolvencies are becoming increasingly important to foreign investors. Adopting the most up to date and comprehensive rule in this area will make Canada a more attractive place to invest.

There is no doubt that Canada's insolvency laws fundamentally contribute to the efficient functioning of the marketplace. These rules of the game provide predictability and security to the marketplace participants, both domestically and foreign. It is important that marketplace framework laws, such as insolvency laws, be kept up to date and respond to the needs of the marketplace. Bill C-55 responds to the new issues that have emerged from a rapidly changing marketplace. I urge all members to support the provisions in Bill C-55 and of course the bill overall, along with its reference to committee.

As I said earlier, it is a pleasure for me to speak in the House at second reading of Bill C-55, an act to establish the Wage Earner Protection Program Act, to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act. As I said already, insolvency legislation applies to individuals and businesses. So does the legislation before the House today.

I am pleased to hear our colleagues propose various amendments on protection for workers. I am eager to see the bill go before the committee. We will ensure that the bill has the broadest scope possible, while maintaining balance, encouraging investments in business and—as has been said so eloquently a number of occasions—protecting the rights of workers.

Some might ask why we are doing the insolvency reform now. An efficient and well functioning insolvency system is vital to our economy. I believe I was sitting in the House in opposition when we started these reforms in the 1990's but many issues were left unresolved and new issues have emerged with our rapidly changing marketplace.

As I indicated a few moments ago, the United Nations and the United States have adopted that model and it is incorporated in the bill we have today. Therefore it is important that the marketplace framework laws, such as the insolvency laws, be kept up to date, respond to the needs of the market and to a degree, as well, to the needs of the international conventions that we sign on to.

We all know that extensive consultations were conducted regarding the bill. As was indicated a little earlier, there was a broad consensus to reform and to modernize Canada's insolvency laws. The proposal before us today reflects the input received from a broad spectrum of stakeholders, such as, insolvency practitioners, representatives of the financial and business communities, labour groups, for which I am proud, consumers' associations and, of course, members of the academic community.

The Senate committee on banking, trade and commerce also conducted public hearings in 2003 and made a number of recommendations for changes to the law and I understand that some of these recommendations are found in the bill that is before us now at second reading.

The reforms in question, if I were to summarize them in the little bit of time that is left, have four main objectives. First, it would encourage restructuring of viable businesses as an alternative to bankruptcy. In this regard, the Companies' Creditors Arrangement Act will be significantly modified to provide increased predictability while preserving flexibility.

Second, the reform would improve the protection for workers in bankruptcy. We have heard a lot about that issue particularly over the last little while. The bill creates a legislative framework for the wage earner protection program that will ensure that workers get compensation for their unpaid wages in the event of an insolvency.

Third, the bill is designed to make the insolvency system fairer and to reduce the potential for abuse. For instance, the bill introduces an exemption for RRSPs and lowers the period of discharge for student loans while it tightens the rules for debtors with surplus income and those with high income tax debts.

Fourth, the bill contains a number of technical amendments to improve the administration of the insolvency act. I raised the issue of the recommendations made by the Senate committee and the work of the committee was very helpful, I might add, and provided a solid basis for developing many of these proposals.

Finally, in response to the issue of Bill C-281, or the wage earner protection raised by other members later, the bill proposes a comprehensive reform to Canada's insolvency system.

In summary, those are basically the highlights of the bill. I urge the committee to do a thorough review and improve it where necessary so that we can further improve on Canada's laws, creating at the same time a favourable climate for investment, both domestic investment and investment from an outside country, while at the same time increasing the protection for consumers, wage earners and others where it is provided in the legislation.

[Wage Earner Protection Program Act, September 29th, 2005]

Mr. Speaker, I rise on a point of order. When I gave a certain speech not that many weeks ago, the House was generous enough at the time to extend questions and comments considerably. I would like to ask for the same thing to be extended now because I see another hon. member who no doubt wants to ask a question or make a comment. Without knowing what he is going to say, and with the same generosity, perhaps we could extend questions and comments by 10 minutes. I would seek that consent.

[Wage Earner Protection Program Act, September 29th, 2005]

Mr. Speaker, my question will actually be a comment. It will not concern the subject matter of Bill C-55. Instead, it will be directed, through you, at the man.

A few weeks ago, I gave a speech which, apart from the fact that it was much longer, said essentially the same thing as what our colleague told us today. I too would like to say what a pleasure it has been for me to work with him. I am speaking for myself and, as the longest serving member of our caucus in the House of Commons, on behalf of all my hon. colleagues, I am sure.

Over the years, he has filled many positions within his party, as have I in mine. We have both been officers of this House. I am sure that I speak on behalf of all parliamentarians in saying that he has always discharged his duties in a very dignified manner.

When he arrived in this House, he was among the youngest parliamentarians. As surprising as it may sound, 12 years later, he is 12 years older, and others are now younger than him. Granted, there are many more who are younger than me. Some parliamentarians were not even born when I arrived at the House of Commons in 1966. My hon. colleague opposite could probably be included among them. I understand that he was 1 year old.

This was just a comment to say that, at any rate, as far as I am concerned, he has been a good member and a good colleague. If I were to ask anything of him, it would probably be this. In his remarks, he mentioned the volunteers working within political parties. I am not being partisan. This goes for all parties, without exception. I think that volunteers are the great heroes of democracy. They work hard; during election campaigns, they head off to the headquarters with their lunch boxes as if they were going to work, to give their time, and they give a lot of it. They ask for nothing in return, besides an opportunity to participate in this exercise in democracy.

Are they not the real heroes of democracy? I respectfully submit that these are the great heroes of democracy to whom all of us, parliamentarians and other elected officials, even those who are not elected but who are less involved than these people, the citizens of this country, owe a debt of gratitude.

[Wage Earner Protection Program Act, September 29th, 2005]

Mr. Speaker, I listened attentively to her speech. She is obviously well-versed and very knowledgeable in this subject matter, as I am sure the entire House has realized. Could she tell us who has been demanding the changes to the insolvency provisions that we now enjoy? This piece of legislation will have a major impact. Perhaps she could indicate to the House who is looking to have changes in that regard, so that all members will understand where the government is coming from with some of these proposed changes.

[Committees of the House, September 29th, 2005]

Mr. Speaker, I have the honour to present the 46th report of the Standing Committee on Procedure and House Affairs received from the Subcommittee on Private Members' Business.

Therefore, pursuant to Standing Order 91.1(2), this report contains items added to the order of precedence under private members' business that should not be designated non-votable.