moved that Bill C-266, an act to amend the Competition Act (protection of whistle-blowers), be read the second time and referred to a committee.
Madam Speaker, I rise today to present Bill C-266, an act to amend the Competition Act, protection of whistle blowers. This bill is a relatively straightforward piece of legislation which seeks to improve the ability of the competition bureau to gather evidence of anti-competitive activities. More important, it legislates the principle that no Canadian should lose their job because they report a contravention of the laws of this Parliament or refuse to participate in the commission of an act which contravenes the laws of this Parliament.
This principle is sound and must be upheld as a test of our commitment to ensure the respect of the laws enacted by the duly elected representatives of the House. Anything less sends a signal to corporations and employers that they can entice or coerce law-abiding employees to engage in illegal activities. This is wrong and must not be tolerated.
With respect to the Competition Act, Bill C-266 legislates in three areas. First, it allows Canadians to report violations of the Competition Act anonymously and guarantees that their identity or the source of the information will be kept confidential. Second, it makes it illegal for an employer to discipline or fire an employee who refuses to participate in, or who reports a violation of the Competition Act. Third, it grants to an employee disciplined for respecting the Competition Act the right to sue for damages or reinstatement.
Although Bill C-266 was born from the need to redress the problems in the marketing and sale of gasoline in Canada, it is important to recognize that the bill applies to all businesses in all sectors of the economy.
I am sure that every member of this House has received complaints about the fluctuations in the price of gasoline. The retail price of gasoline fluctuates in unison. In any market when the price goes up, it goes up everywhere at the same time. Mysteriously, it always increases by the same amount. The gas industry calls these price fluctuations conscious parallelism. My constituents call it suspicious and they even call it price fixing.
The gas industry says it only reflects the industry's cost structure and the nature of supply and demand for petroleum products. Independent gas retailers say that the price fluctuations are an attempt by the majors to force them out of the market, to control the market and to lessen competition.
Here is the bottom line: Canadians do not trust how gas prices are set and Canadians have lost confidence in both industry and governments on this issue. They have both failed to adequately explain why gas prices fluctuate in unison and why the price of gas is higher in certain areas of the country.
Every week I drive to Ottawa from my riding in northern Ontario. The further east I get, the lower the price of gasoline. I can tell the House that higher prices in northern Ontario cannot be explained away by transportation costs.
This is an issue which irritates all Canadians. This is a problem for Canadians and they are calling on their elected officials to take action. Some governments have acknowledged the problem and are moving to address it.
In Nova Scotia the provincial government is concerned that the pricing policies of refiners are squeezing out the independents. It believes that this would eventually lessen competition, reduce consumer choice and lead to even higher prices. It is considering the introduction of anti-trust laws to protect independents and guarantee competition.
In response to the Ultramar situation of last summer, the Quebec government announced last week that it would legislate margins above wholesale prices. Prior to the announcements, even Quebec's Fédération canadienne de l'entreprise indépendante had requested that the government legislate to protect independent gas retailers and consumers at the pumps.
The premier of British Columbia is on record as stating that government action may be required to protect consumers at the pumps.
In Ontario the MPP for Ottawa West has introduced a private member's bill on fair gas pricing in the province. Even the premier of Ontario has acknowledged the problem. When in opposition, he pressured the Rae government to keep its promise to take action on the pricing of gasoline.
The Americans have and are facing the same problem. Their responses, more daring than ours, provide us with useful insights.
In the midst of the gulf war crisis, President Bush warned U.S. oil companies not to use the crisis as a pretext to gouge consumers at the pump. In the spring of this year, President Clinton ordered the sale of 12 million barrels of oil from emergency reserves in an attempt to hedge down the price at the pumps. However, these are incidental actions. The real tests are the actions taken by state legislators.
A large number of states, 21 I believe, have legislation that mandates refiners to sell gas at the same price to all retailers, independent and company owned stations. Maryland, Connecticut, Delaware, Virginia, Washington, D.C. and Puerto Rico have gone further by enacting gasoline divorcement laws that prohibit the producer or the refiner of gasoline from operating service stations.
I find it ironic that on this issue the Americans are ahead of us in protecting consumers. Here in Canada the response from the federal government has echoed the petroleum industry's line that price fluctuations simply reflect supply and demand. Canadians are not convinced.
The competition bureau has held industry wide investigations but has failed to uncover price fixing. Investigations and prosecutions of gas companies and retailers suspected of price fixing have not met with resounding success. Another such industry wide probe is now under way.
Consumers and independents are travelling to Montreal and Ottawa to provide testimony on their experiences with anti-competitive pricing in the industry. However, they remain sceptical that the investigation will lead to any significant change even though they and their consumers know that they are being wronged.
There is little doubt that addressing the whole issue of pricing in the gasoline industry will require concerted action by both the federal and provincial governments, each acting within their respective jurisdictions. Some provinces are moving in this direction. It is now time for the federal government to follow suit. Bill C-266 is an important step along this path.
Industry Canada informs us that the sections of the Competition Act dealing with conspiracy, abuse of dominant position and others are adequate to ensure competition and protect consumers at the pumps. If this is the case, how do we explain the lack of successful prosecutions? I doubt that the majority of Canadians are wrong about the pricing of gas.
According to the former director of the competition bureau, Mr. George Addy, the problem lies in the collection of evidence needed for successful prosecutions. To prove the existence of illegal agreements to fix prices at the pumps, the assistance of the individuals who make and implement the agreements is needed.
In June 1995 Mr. Addy testified at the natural resources committee hearings on gas prices. He stated: "I need the co-operation of individuals and firms who have information". He later added: "A law is only as effective as the evidence one is able to assemble when a genuine contravention occurs".
I believe it is even more revealing to quote from the Globe and Mail , May 14, 1996 edition: ``Last year George Addy, the bureau's director of investigation and research, said his agency would be able to police the petroleum industry more effectively if it were easier for people to blow the whistle on illegal practices. Direct evidence of wrongdoing is difficult to obtain without the help of insiders, said Addy. As it stands, he noted, anyone who comes forward puts his livelihood at risk''.
In his testimony before the committee, Mr. Addy proposed to improve the operations of the Competition Act by better protecting informants and witnesses who disclose illegal conduct, and by pressuring firms to adopt voluntary whistle blowing mechanisms within their organizations.
Bill C-266 takes up and legislates Mr. Addy's recommendations because industry self-regulation of competition matters is simply nonsense. Delegating the responsibility for competition to corporations goes against public interest. Guaranteeing free and open competition in the marketplace is too important.
This brings us to the two fundamental questions that must be addressed in this debate. The first question is: Should an individual lose his or her right to earn a livelihood because he or she reports a violation of the Competition Act or refuses to participate in a violation of a law passed by this House?
The answer must be no, unless the members of this House deem that individuals standing up in defence of Canadian law are not worthy of protection. Here we are talking about individuals standing up for consumers, for us, for our constituents. The preamble of the Competition Act states as one of its purposes "to provide consumers with competitive prices and product choices". We must never lose sight of this.
The principles legislated in Bill C-266 are not new. They are well entrenched in Canadian and even in American law. For illustrative purposes, members can consult the Canadian Environmental Protection Act, the Ontario Environmental Bill of Rights, 1993 and the Alberta Freedom of Information and Protection of Privacy Act.
American law is also no stranger to whistle blower protection. For example, the Fair Labour Standards Act of 1938 and the Occupational Safety and Health Act of 1970 among many other laws protect employees who report illegal conduct.
I would like to draw particular attention to New Jersey's conscientious Employee Protection Act. This law protects employees who report or refuse to participate in a breach of any law, whether federal, state or local. This type of protection implements the principles of Bill C-266 in the largest possible sense in all fields of human activity. It fully recognizes the premium society places on respect for the law.
The first principle on which Bill C-266 is founded is therefore sound.
The second question is whether a Canadian in possession of information that a breach of an act of Parliament has or will be committed should have the right to file an anonymous complaint.
An individual should have that right. That option serves as the operational foundation of Crime Stoppers. Few would question the effectiveness of that program. It is important to note that many of the violations of the Competition Act are also infractions under the Criminal Code.
Therefore, we have before us in Bill C-266 a bill that is founded on fundamental principles that I am confident the majority of Canadians and members of this House support, a bill that legislates recommendations made by the former head of our own competition bureau, recommendations which he stated would improve the detection and investigation of violations of the Competition Act in relation to price fixing in the gas industry.
In May 1996 the Minister of Industry stated that he would review the desirability of introducing whistle blowing protection into the Competition Act. That is the bill before us today. I regret to inform the House that the Department of Industry has advised me that it does not support Bill C-266 even though it follows the recommendations of the former head of the competition bureau.
Although we have all come to expect the near automatic disapproval of private members' bills by government departments, I was disappointed to learn of the department's continued inertia on the pricing of gasoline, a real and serious concern for consumers. Nonetheless, I am heartened that the final judgment on Bill C-266 lies with the elected and accountable members of this House and not the bureaucracy.
On a positive note, the department does support enhancing confidentiality protection offered to complainants, a key element of Bill C-266. The department states that it disapproves of Bill C-266, because it favours industry self-regulation of whistle blower protection. It wants employees of gas companies to lobby their bosses to permit them to report breaches of the law. It wants gas companies to offer bonuses to employees who report illegal
acts committed by the firm. It wants gas companies to establish internal procedures for reporting crimes. This is nonsense. Gas companies are the problem and the department wants them to self-regulate their own breaches of the Competition Act.
In the real world the employee who reports a breach of the law and costs his or her firm a fine, loses his or her job. They certainly do not get a bonus and a promotion. "Anyone who comes forward puts his or her livelihood at risk". Those are the words of the former head of the competition bureau, George Addy.
There is no doubt that we need legislation in this area to protect the individual who stands by the law and who stands up to protect our interests against anti-competitive practices.
There is also a double standard and contradictions in the department's approach. In June 1995 the competition bureau released a discussion paper on amendments to the act. It makes interesting reading. Do consumers know that the department wants to repeal the section dealing with price discrimination? This is the section that ensures that gas refiners offer similar price advantages to all outside retailers. I am confident that independent gas retailers and consumers will pay the price for this initiative should it ever become law.
It also wants to give the court the power to force a company to initiate a whistle blower program. This of course does not protect the employee from dismissal. Why extend any benefit to the employees of one firm and not to all Canadians? Why should we have to go to court to force the company to institute any program to facilitate the gathering of information?
It also wants to give the competition tribunal the power to make restitution orders when an individual or firm has suffered a loss due to anti-competitive and misleading advertising. Good for the company. But by rejecting Bill C-266 it is refusing the right of restitution to the employee who respects the law.
It wants to give firms the right to launch their own cases before the competition tribunal. But it wants to deny the right of an employee to keep his or her job after he or she makes a stand in support of the Competition Act.
It is clear that we are witnessing in matters of competition the development of double standards. An expansion of remedies for firms, including gas companies, and a denial of remedies for law-abiding employees who defend the interests of consumers in free and open competition.
I am sure we are going to hear representatives from the government raise jurisdictional issues. Often times a preference for the status quo and inaction is clouded in jurisdictional issues. The Competition Act is a valid federal statute as is any disposition which adds to the arsenal of tools needed to investigate and gather evidence of anti-competitive behaviour.
In June 1995 the competition bureau stated before a committee of the House that the measures found in Bill C-266 would improve policing of the gasoline industry. Bill C-266 only implements what the bureau recommended and I know the slew of lawyers at the bureau would not recommend anything outside their jurisdiction.
This bill does not regulate or mandate prices. This is the jurisdiction of the provinces and they must make their own choices. It improves the operations of the act and offers new tools to protect law-abiding Canadians.
Finally, the department objects to the use of the word commission in Bill C-266. I have reviewed the objection and I have consulted with the legislative counsel's office. In the proper housekeeping and the interests of open and free debate, I recognize this technical point. The issue can be resolved by simply replacing the word commission by director. I will propose an amendment when the House forwards the bill to the committee. It must be noted that this technical amendment in no way affects the general scheme or intent of the bill.
In closing, I would like to re-emphasize that this bill is straightforward. It makes sense. Canadians need it. Canadians want it. It brings us one step closer to solving the problems of pricing in the gas industry.
