Lost his last election, in 2004, with 41% of the vote.
Small Business Loans Act November 28th, 1995
No, it was not the first time. We have accepted many of the good ideas of the member from Okanagan.
The point I am trying to make is the government would not abrogate to committees of the House its executive responsibility. The member for Trois-Rivières is asking the executive of the Government of Canada to just give its executive responsibility to the industry committee. We could not support such an idea, because ultimately the Prime Minister and the cabinet, the government, are responsible.
Small Business Loans Act November 28th, 1995
Madam Speaker, I listened attentively to the member for Trois-Rivières. Quite frankly, there are some points the member makes that are quite valid. I would like to dwell on the first point for a couple of minutes, and that has to do with the reduction in the government's liability from 90 per cent on the small business loan guarantee to 85 per cent.
Last year the government liability for the Small Business Loans Act float was approximately $100 million. That is what it cost. Effectively, what we are doing with this amendment to the bill, which the Bloc does not support, is reducing the liability from $100 million to $95 million. In other words, by lowering the exposure of the government we are going to save $5 million.
The member for Trois-Rivières makes a very interesting point. Will that five per cent threshold cause banks to not look as hard or take as much of a chance with those smaller, more innovative, knowledge based firms? I am not sure that it will not.
Two weeks ago we heard in the industry committee that the small business float for all banks in Canada was $28 billion, a one per cent increase in the float over the year before. The banks of Canada that make loans under the Small Business Loans Act were guaranteed, prior to this legislation, 90 per cent of that loan by the crown. The float right now is around $4 billion to $5 billion. If we deduct that Government of Canada guarantee to the banks on those loans, then effectively we have not had a real increase in the small business loan activity in this country in the last two years.
We have to be very careful. I am not going to support the member's motion to reduce the crown's exposure. The member from Trois-Rivières wants the government to go on the hook for another $5 million. I am not going to support that. Because of the pressure from the Reform Party, our government is on a fiscal obsession with the deficit and the debt. I hope this path will head to a quicker economic recovery. But I share the view of the Bloc member for Trois-Rivières that we are going to have to be vigilant, because if we lower the government guarantee to the banks we may see a lot of good opportunities go by the wayside. The banks might not come to the party. We need small business going full throttle in the country.
I think the member's motion gives us an interesting concern, which we register. But we must at the same time balance our responsibility with reducing the cost of managing the program to the taxpayer. We will try it, and if we see that the activity on the Small Business Loans Act does not continue at the same rate or if there is not the same action on the Small Business Loans Act, then as a committee and as a government we can ask the minister to reopen the file. But we must give it a chance in the interest of fiscal restraint and make sure that the bill is focused on cost recovery.
I must say that the member for Trois-Rivières has done a fabulous job in the industry committee in the last two years. Instead of his party being called the Bloc Quebecois, I wish they were called the Bloc Canadien. If they were called the Bloc Canadien, then imagine the thrust we could get going in the House and the stimulation to the economy.
Who knows, once the current leader of the Bloc Quebecois moves to Quebec City perhaps we will get a conversion going and the Bloc can become the Bloc Canadien. I sense there are a lot of members in the Bloc who really do by and large share some of the values and some of the things we all aspire to in the House for all of Canada.
The second part of the member's point is about giving the industry committee the authority to amend this bill. That would be equivalent to changing the whole system of government. We all know our system of government gives the Prime Minister and his cabinet the executive responsibility to put legislation forward. We members of Parliament have the ability and the opportunity to provide input and to amend, as we are doing here today.
The reason we do not have any motions being put forward today by the Reform Party is because the motions and ideas of the Reform critic for industry were accepted in committee and have become part of the bill. It is not as if members of Parliament do not have the-
Bank Act November 27th, 1995
Mr. Speaker, I presume the hon. member was talking about the campaign donations made to the parties. I do not think political donations made by the banks really have any effect on whether a government would deal with an issue such as this. I do not see it. I could be wrong.
Where we have a problem as a government, and this is all governments, has to do with the bonds, the government coupons that are being clipped by banks; in other words, buying our debt. That is where bank decision makers can have a tremendous influence on the executive of a government. We are so dependent on the marketing and the purchasing of those bonds.
That goes back to what the member from Okanagan said earlier in his remarks, which has to do with transparency. When we have a bill like this today, Bill C-100, where we are dealing with the Superintendent of Financial Institutions and all the major financial institutions in Canada, I find it absolutely stunning that there is not a list of speakers the length of this room who want to speak on this bill. It gives us an opportunity not only to exchange with each other but also to send a message to the implementers of this bill where we, as a collective group, are coming from.
In my judgment, as MPs, we are blowing a gift to debate one of the most fundamental issues facing Canadians today, which is the ability of small business to gain access to capital. The Superintendent of Financial Institutions is one of the key players in making sure that happens and happens properly.
What are we doing? We have just half a dozen speakers, then the bill will go through the House. It is not that the bill would not go through the House, but this is a good reason to have a good, exciting debate to provide some hope for the only sector in the economy that is creating jobs.
Where are we today on this issue? I am not being critical of the House. I am just saying that every now and then we get a gift handed to us. This is one of the bills that affects the lives of most of our constituents. I wish we could create a little more excitement around it so the superintendent would understand where all of us are coming from on this issue.
Bank Act November 27th, 1995
Mr. Speaker, before I deal with the specific answer to the question I will deal with the first part of my colleague's remarks.
I do not believe it is appropriate for us to stand in the House and defend the chartered banks of Canada until they have really delivered on the objectives the hon. member helped to form in our "Taking Care of Small Business" document.
Yes, the banks have agreed to create an ombudsman, which they essentially appoint, because they control the board of directors. However, I am nervous about our effectiveness as a committee. Yes, they will report more numbers, but let us face it, the banks will not give us what we wanted in recommendation number two, where we wanted a much greater regional breakdown. When I only see a one per cent increase, which is what I call real action, not words-they are fantastic. Remember that campaign of the Bank of Montreal: "We want to share your pain". When I see only a one per cent increase in the small business float, are they getting to us? Are they pushing us off the mark? Are they pushing us off our focus? Are they distracting us?
This is not bank bashing. There are a million small business men and women out there, and there are as many in the hon. member's riding as there are in mine. If his small business men and women are saying to him that the banks are doing a great job, then his small business men and women are different from mine. They are saying we have not made much of a difference yet.
I plead with all members, if we get one thing done in this session for small business, let us make sure that we get the banks into the business of loaning to small business in a serious way.
In answer to the member's specific question about CDIC fees being disclosed, for me it is a slam dunk: I think they should be.
Bank Act November 27th, 1995
Mr. Speaker, I appreciate having the opportunity to stand and support Bill C-100, an act to amend, enact and repeal certain laws relating to financial institutions.
This bill, which is essentially a housekeeping bill, has many good features in it. We are giving the Superintendent of Financial Institutions, an organization within the Government of Canada, the power and the capacity to have a much more specific accountability. This is not just in terms of protecting depositors' funds, but also in terms of making sure that the financial institutions are following all of those rules and regulations they are responsible for following which is the reason they got their franchise.
A bank is really not any different from a McDonald's franchise. The person who applies for a McDonald's franchise has to live by the rules and regulations of the administration granting the franchise. If that McDonald's franchiser is not following the rules, then as I am sure members have heard from people who have owned a franchise other than McDonald's such as Budget or Swiss Chalet, the management will say: "There are rules and regulations attached to the franchise that you have been allowed to operate. You are not following them and if you do not clean up your act, we
are going to pull the franchise. We will pull our agreement. We will take the franchise away from you".
Very few Canadians realize that the people of Canada through their trustees and agents in this House of Commons are the ones that grant the banking franchises which exist in Canada. The men and women in this room are the ones who design the rules and regulations that allow the banks to operate. The basic thrust behind that banking franchise is to protect depositors' funds but they are also to be in the business of lending money.
The banks, the franchisees, have done a pretty good job of those 7,000 little franchise operations across Canada, whether they be the Royal Bank or the Bank of Nova Scotia. They have done a pretty good job of protecting depositors' funds.
Where I have a problem is the way they have been handling their relationship with small business men and women. If I had my druthers and if I had had an opportunity, I would have added a couple of amendments to the bill. I would have liked a very specific responsibility given to the Superintendent of Financial Institutions on behalf of small business.
As the Superintendent of Financial Institutions goes through all the lists of responsibilities he has to maintain in his relationship with banks there is special mention for small business. I do not see it in here anywhere. On that score, I am disappointed. It does not take away of course from supporting the bill because there are a lot of good things in this bill.
Today I have the opportunity to stand on my feet in the House two years into our mandate. I have to say that our effort to sensitize this country's banks to become much more supportive of small business has not grown. That attitude change has not grown the way it should have grown.
I see my colleague, the industry critic from the Reform Party, who sits on the committee with me. He is nodding his head in approval that we really have not done as much as we should have done in committee.
I do not want to say that our efforts and the efforts of the banks have been a total failure. Two weeks ago there was a meeting of the industry committee. It was reported in a document that at the end of the second year there was an increase in the small business loan float. We were all very excited about getting that document. We saw that the loan float for all small business men and women in Canada was approximately $28 billion. That is the total of outstanding loans being utilized by small business men and women. That is a 1 per cent increase in the small business loan float over the last year.
Granted some people would argue that we are lucky it was not a decrease. However, when we consider the government's Small Business Loan Act guarantee, which is also included in that and the fact that the float increased, the real risk the banks have taken on behalf of small business men and women has not increased that much in the last two years. We are going to have to continue to press forward.
We hope eventually the banking culture, the men and women who operate the 7,000 bank franchises across Canada, in the not too distant future will be fully converted. We hope they will realize that the only way the economy is going to get back on the right track and men and women will get back to work is by making sure the small business community is given the maximum opportunity and the best environment in which to grow.
The Superintendent of Financial Institutions can play a major role in helping members of Parliament accomplish that policy directive. I am not talking about my policy directive here today; it is a policy directive of the Prime Minister of Canada. Make no mistake about it. Two months before the last national election campaign began the Prime Minister of Canada sat in the press gallery across the street from Parliament and said on coast to coast television that we were going to be the government that would really work to change the attitude of financial institutions toward small business men and women.
When I stand in the House today and support this bill and talk about access to capital for small business men and women, I am speaking on behalf of the Prime Minister and the Minister of Industry. In the last budget even the Minister of Finance said that we have to create new benchmarks for the banks in relation to the small business sector.
Those in the Office of the Superintendent of Financial Institutions who will take this bill after it has passed here today and later through the Senate are responsible for monitoring, reviewing and auditing small business activities. I plead with them to assist us in sensitizing those 7,000 branch managers, those franchise holders that small business must be very much a part of the language of the review, et cetera.
I want to move on to another aspect of the bill which I am pleased to see is addressed. It is on page 29 and deals with the whole business of derivatives.
It is no secret to anyone in the House that I have always been concerned about the private casinos the financial institutions in this country operate, the derivative sections in the banks. I see that this bill gives the Superintendent of Financial Institutions enhanced
authority to go into those derivative sections within the financial institutions and do thorough and complete audits.
I will be honest. I do not understand the complexity of the derivative game the banks are playing. I notice other members are nodding likewise. However, I trust that the expertise exists within the Office of the Superintendent of Financial Institutions. Some members are noting they are not convinced of that. I hope they are wrong. I will tell them why I hope they are wrong. I know of one financial institution in this country that in its derivative section, which I call the private casino, trades close to $30 billion a day. In one 24-hour period it trades $30 billion. This is an amazing amount of paper pushing, going back and forth. There are very small margins but with very big exposure.
If the essence of this bill, as my colleague from Dundas said earlier, is to make sure those depositors' funds are protected, then the Superintendent of Financial Institutions should start by making sure there is a good solid handle on all those private casinos, all those derivative sections in all the financial institutions.
Do members not wonder sometime how one bank can find $30 billion to play the derivative game in one day yet cannot seem to find the resources for the small business men and women who really require a small loan of $10,000 or $15,000 or $50,000? Am I losing it? Does anyone wonder about that sometimes? It is a totally different issue, but it has to do with will and attitude, which is the point I am trying to make.
If the board of directors or the senior management of a bank decides it is going to be in the derivative business and play with $30 billion a day, it happens. These guys work 24 hours a day, 7 days a week in these derivative sections of the bank. So if the management of a bank puts forward a policy that allows $30 billion a day to be pushed around the world by these unelected, unaccountable people who can affect the way our dollar goes and affect our interest rates, then why can we not get the same kind of will from the management of the banks to increase the float to small business by a little better than one per cent a year?
I noticed my colleague from the Reform Party, the industry critic, is saying that we can do it. We on this side of the House appreciate his consistent support as we deal with this issue.
This is a good bill because it gives the authority to the Superintendent of Financial Institutions to make sure that not only are depositors' funds protected in a more thorough way, but the whole administration of the bank franchises is followed according to the basic framework of the Bank Act. Alongside that responsibility, I would also ask them, as they go through their check list of responsibilities, to add another one: check and make sure that those 7,000 franchise holders of bank licences or bank charters across Canada are doing what they should be doing for small business.
Bank Act November 27th, 1995
Mr. Speaker, I thank the member for his contribution on a very important issue.
It is important for members of the House and the public to know that the critic for industry from the Reform Party has been working very hard in committee over the last two years on the whole issue of access to capital for small businessmen and women. The issue we are debating today is very important for that whole small business market.
We have been trying to the best of our ability in a non-partisan way to try to change the thought processes of the banks in their attitudes toward small business. Frankly, after two years despite a bunch of PR from the banks we have not accomplished a lot.
Does the member not fear or have concern that those million small businessmen and women out there who depend by and large on that relationship with their branch managers will once again lose leverage with their financial institution because once they take on the insurance component of a business relationship, that small business will have no other place to deal than with the bank? If that relationship is not solid then that small businessman's or businesswoman's whole equation is in jeopardy.
Supply November 21st, 1995
Mr. Speaker, I appreciate having the opportunity to share time with my colleague, the member for Vaudreuil, on this Bloc Quebecois opposition day motion.
It is important to go over the words of this motion presented to the House by the Bloc. They are condemning the government for having dropped the Canadian content requirements in the contracts for the purchase of military equipment and refusing to set up a genuine program for the conversion of the military industry, thus endangering the Canadian aerospace industry located in Montreal.
It is important for all Canadians to know, and specifically Canadians from Quebec, people from Quebec who still believe in Canada, and even the separatists for that matter, that it was a Liberal government that basically set up the foundation of the aerospace industry in the province of Quebec.
We only have to go back to when the current Prime Minister was the minister of industry in 1977. As the Minister of Industry, Trade and Commerce, he was the one who bought the rights for the Canadair Challenger jet. That Canadair Challenger jet, which started out as an executive jet, as we all know today is probably one of the best commuter jets manufactured in the world. That industry is alive and well in the province of Quebec, which is part of the Bombardier Corporation.
We just need to go back to 1980-81, when the then Liberal government under the direction and leadership of Pierre Elliott Trudeau made a multi-billion dollar purchase of the F-18A fighter aircraft and 80 per cent of the offsets in that fighter aircraft were basically let out to the aerospace industry in Montreal.
The history of and the commitment of the Liberal government to the aerospace industry in the province of Quebec are well laid out. There is a great commitment and there is great history. For the Bloc Quebecois to suggest that we as a government are not committed to supporting this industry is simply incorrect.
In the motion the Bloc Quebecois is saying that the government dropped the Canadian content requirements. It is forgetting what happened when many members of the government were in opposition.
I would like to return to the free trade agreement. The leader of the Bloc Quebecois supported the free trade agreement. Many of us on this side of the House opposed the free trade agreement. One of the reasons we opposed the free trade agreement was chapter 14, which essentially gave people offshore unfettered access to and unlimited control over the Canadian industry. As part of that agreement, we now are prohibited from dictating Canadian content.
We have to remind the members of the Bloc Quebecois that they cannot suck and blow at the same time. It is not possible. They cannot stand up in the House to support the free trade agreement, which essentially gives up our ability to dictate Canadian content, and then come back three years later and condemn the government for having dropped the Canadian content requirements. That is the motion we have before us today.
The members of the Bloc Quebecois opposed the notion of having control over Canadian content three years ago, and they are regretting it today. It was the Liberal Party that opposed the free trade agreement as it was negotiated by the previous government.
I have always believed that the auto pact was an example of a negotiated trade agreement in which we could enshrine our interests and our ability to ensure Canadian content. That was a unique feature of the auto pact. However, we gave up the opportunity to negotiate a similar agreement for the aerospace industry.
It is very important for us to let Quebecers know that the Liberal government is not opposed to the aerospace industry in Quebec being a vibrant and healthy sector. The Liberal government will not do anything to hurt the industry. If anything, we are going out of our way to help it.
The question that was brought up by some Bloc Quebecois members this morning is what is Quebec's fair share. The Canadian space station is based in the province of Quebec. That is one of the premier institutes of the industry. The commuter jet of Canadair is being manufactured in Quebec. The maintenance of the F-18A, our fighter aircraft, is being done in Quebec today. As a Toronto member, an Ontario member, I have absolutely no difficulty with that. It is a good move. By building a critical mass of expertise in the province of Quebec in the aerospace industry we create a capacity to bid on some available subcontracts, prime military contracts available throughout the world.
In other words, we obviously do not have the capacity to build total military aircraft or total products in an off the shelf sense. However, because of the component specialization that exists within the aerospace industry in the province of Quebec, we can bid on some component parts with any of the prime manufacturers not only in the United States but anywhere in the world.
It is very important to make sure our fellow Canadians realize this avenue of opportunity is available for people in the aerospace industry in the province of Quebec.
It is true that in the past we were much more aggressive in dictating Canadian content. However, because of the ability to make a quality product at a competitive price, there is probably a lot more opportunity in the aerospace industry in the province of Quebec than Bloc members are giving it credit for.
As part of the new defence industry conversion program we are trying to say to those people in the aerospace industry that although we no longer give direct grants we will make sure we give them marketing support. If they have a quality product in that sector at a competitive price-and we certainly have an advantage because of our Canadian dollar-then the secret would be centred in the whole area of marketing. We have to market the aerospace industry in the province of Quebec.
Rather than stand in the House today and cast doubt on the ability of the aerospace industry to compete, we should be boasting about the quality products made in the aerospace industry in the province of Quebec and figuring out ways of doing things together.
Supply November 21st, 1995
Madam Speaker, I have a short question. Since it is almost two o'clock, I would prefer to begin my remarks after question period.
I would like to build on the member for Vaudreuil's point. He alluded to the notion of creating this infrastructure, which ultimately leads to exports. This is the point I was trying to make earlier to the member for Kootenay East when I asked the member of the Reform Party if he did not see the investment that was made in the automotive industry from the auto pact until the free trade agreement. Under the free trade agreement we do not have the same options of opportunity to invest in that industry, but thank goodness it has a great foundation now: the auto pact leads, in terms of job creation and exports, any sector in our country.
The point I was trying to make to the Reform Party is this infrastructure we have invested in within the province of Quebec in the aerospace industry now leads to tremendous exports not only in terms of military hardware, helicopters, et cetera, but also aircraft like the Canadair commuter jet, which is now being exported all over the world, creating jobs not only within the province of Quebec but across the country.
Could the member for Vaudreuil confirm for the House that the investments the Liberal government has made in the aerospace industry are now leading to all kinds of exports around the world, which ultimately means jobs for Canadians?
Supply November 21st, 1995
Madam Speaker, I want to put a question to the member for Kootenay East. It has to do with the issue of Canadian content.
The greatest dollar value of exports, not just in terms of dollar value but number of jobs created in the country today in the manufacturing sector, is the automotive industry. The automotive sector represents the greatest number of jobs and exports. The foundation that has generated that reality today started when the auto pact was negotiated with the United States of America.
In that auto pact, percentages of Canadian content were negotiated. As the automotive industry was developed, the taxpayers invested in the foundation stages hundreds of millions of dollars in new equipment, in research and in the capacity to manufacture a world class, automotive, technology manufacturing capability.
When we have such a model of proven success in job creation in a sector that is bringing literally billions of dollars to the treasury right now when it is looked at in its totality, why should we not do a careful analysis to see if we could not create the same opportunity in the aerospace sector?
I realize that the free trade agreement states that Canadian content can be dictated no longer. I opposed the free trade agreement and that was one of the reasons why I opposed it. I felt that it took a piece of our industrial policy making capability away from us. However, why would we not take a look at the aerospace industry in the same light as the automotive industry?
Supply November 21st, 1995
Madam Speaker, I have a question for my colleague, the Parliamentary Secretary to the Minister of National Defence. The thrust of his speech dealt with the whole issue of off the shelf. We must be more sensitive to off the shelf purchases.
I realize that some of the prime military manufacturers are not Canadian yet Canada has some of the best component part manufacturers in the aerospace industry. What is the government or the Department of National Defence doing to marry our aerospace component manufacturers with those prime military manufacturers? Is there something that could evolve like the auto pact which we have for the automotive sector?