Nelson Riis

[Small Business Loans Act, October 26th, 1995]

Mr. Speaker, I am delighted to have the opportunity to say a few words regarding Bill C-99, an act to amend the Small Business Loans Act. At second reading stage the assumption is that we are talking about the principle of the bill. On that point I want to register a deep disappointment with this initiative.

We have heard thoughtful presentations from all sides of the House regarding the value of small business, the importance of small business and the critical nature which small business has taken on in the changing economy. If this is any indication of how the government plans to react to these needs, to this new sense of dynamism in the country, it is pathetic.

My hon. friend from the territories indicated that this is a major step forward. This is not a major step forward. Quite frankly, this is a little technical housekeeping which will build total cost recovery into the legislation. Actually, it will probably make it a bit tougher for people to obtain a loan because of the loan guarantee being decreased to 85 per cent from 90 per cent. That will cause the banks to be a bit more wary in terms of lending.

Then of course there is the provision that through order in council the government can make changes to the legislation. I have seen changes in my short time as a member of Parliament. At one time there was a 100 per cent guarantee. Then it decreased to 90 per cent. Now it is being decreased to 85 per cent. It is fair to say that if this trend continues, we will soon see the guarantee being decreased to 75 per cent, 50 per cent, or whatever, which would essentially make it a non-program.

I am concerned about the influence which, behind closed doors, cabinet will have to change this crucial piece of legislation. I happen to think it is a good piece of legislation. However, I do have a deep concern that this is the only initiative which we are discussing.

Let me put this into context. I am one of many members who believe that the small business sector is the crucial job creating sector in the country today and will be even more so in the future. As a result of both government and private enterprise downsizing, the role of the small operation, the independent operator and entrepreneur has become more important than ever.

We are visited regularly in our constituency offices by young people who have sent out 200 resumés, who have filled out 100 job applications or who have knocked on 50 doors trying to find employment. Often these young people are well educated and well trained. They have marketable technical skills and good research abilities. They are self-starters and so on. Yet they are having difficulty finding a job using the traditional process for finding a job.

The young people of the future who will be employed will be those who actually create their own enterprise. They will realize that they will not be working for a firm. They will not be working for an accounting company. They will not be working in a small manufacturing firm. It will be up to them to actually start their own enterprise from scratch. They will be the ultimate entrepreneurs, able to take a concept, see an opportunity and put that into play.

Today we see two different types of small business operators. One type is the small business operator who finds himself attempting to start a small business or is looking for ways of starting one. He has very little experience in the world of business and probably never thought he would actually start a business.

Because of the layoffs in the private sector and the downsizing in the public sector people like him simply find themselves out of work and the only solution they see is to start an enterprise. One of the areas where government could help would be to find ways and means to enable those men and women to obtain the necessary

skills to start a small business and to run it successfully, or to upgrade their skills or obtain retraining.

I appreciate there are programs in place now. I am thinking in particular of some of the work done by the Business Development Bank of Canada and others. This is one area where government can provide some service to encourage the development of these, let us say, incubator centres.

The other type of business people are the individuals who have wanted to be in business all their lives. Simply by their nature, instinct and character they are business people. They have developed the necessary skills or perhaps have them innately and have enrolled in programs or courses to bring themselves up to speed to be successful business operators.

These two types of operators are now becoming increasingly more familiar on the economic landscape of the country.

In Kamloops we are in the process of celebrating Small Business Week. I heard the definition of a small business person the other day and I thought it was very apt. I realize that when it comes to the Canadian Federation of Independent Business and other business organizations, economic organizations, banks and other financial institutions, they all have their own definitions of what a small business operation is.

The one this person came forward with was that a small business person is one who works 18 hours a day, seven days a week for the equivalent of about an eight hour daily wage. In today's economic environment that pretty well sums it up. These people are dedicated and committed to their enterprise. They are prepared to dedicate literally their entire lives. It becomes a lifestyle to see a new business start up or an existing business to continue to expand. These are the people we need to encourage in all ways.

The question is: How do we encourage them? What can we do? Personally I have wrestled with this for many years. I sent out a questionnaire to the small business operators in my constituency a while back. I asked them to help me with ideas as to how they thought the government could help them.

Summarizing what they said, they said three things: "Get out of our way; get out of our way; get out of our way. We will take care of ourselves. We do not actually need help. If you could allow us to more easily spend time on developing a new enterprise, new technologies, new processes, new marketing programs, that is what we need to do. We need to spend time on that as opposed to filling out countless forms". Mountains and mounds of red tape confront the typical small business operator. There is a lot of truth in that.

Underlying all of this is the recognition of the hated GST and what that has done and continues to do particularly to small businesses. I look across the aisle at my Liberal colleagues and do look forward to the day when that GST is replaced. I do not mean that the name be replaced; I mean that the actual tax be eliminated and we come up with a system that is less cumbersome and more fair for the small business community.

There are three good features we have seen developed over the last number of years. On the top of my list in terms of support, assistance, encouragement and nurturing for small business operators is community futures. I do not know what other people have had in terms of experience with community futures but I want to mention what I have experienced.

In the Kamloops area we set up a community futures called Thompson Country Community Futures Society. Over the last number of years hundreds of new businesses have resulted from that government program, but not the government program per se. Obviously individuals who had the ideas, the energy and the dedication to see these businesses through to completion were the critical ingredient.

However the community futures program was able to provide start up funding in two ways. One program working in co-operation with Employment Canada enabled people to continue receiving unemployment insurance while they started up a new enterprise. It has been very helpful and very successful. Everyone would acknowledge that the chance of a person starting up a small business getting into a profit making situation in the first few weeks or months is very remote.

The program enabled individuals who had lost their jobs and were eligible for unemployment insurance to continue receiving unemployment insurance for a number of months while they started their new enterprises. That made the difference. That gave them a leg up, a small opportunity to provide for their families at the same time as they were starting their new enterprises.

Another program attached to community futures was the one where small businesses with good business plans could apply for up to $75,000 in funding. The decision is made by successful local business people who know the region, know the area and perhaps even know the individual. They have a very sound appreciation for what businesses are successful, what businesses have a good chance at being successful and what risky areas should be watched. They evaluate business plans put forward often with help from the Thompson Country Community Futures Society and make decisions.

They are loans, not grants, with modest interest rates attached to them with often generous payback programs that are rather creative in terms of paying back the money being borrowed. They are provided to new firms, particularly the ones that do not qualify easily in terms of usual categories for bank funding, particularly people who are trying new market areas, new technologies or creative new age businesses that do not have a lot of inventory to

use as collateral in the traditional approach to lending of financial institutions.

The Business Development Bank of Canada is playing a more positive role now than it has in the past. Over the last number of years to say that I have been disappointed with the role it has played would be understating my concern. I looked at the old FBDB operation and compared it to the Royal Bank of Canada, the Bank of Montreal or whatever. It seemed that it was the most conservative lending institution on the landscape and was certainly of little help to small business when it came to lending. When it came to case counselling and so on it was another matter. That has changed somewhat and I appreciate the thrust of the new legislation is a step in the right direction.

As my friend from Western Arctic indicated, banks and other financial institutions are changing slightly. They are moving slightly in the right direction. A lot of credit goes to members of Parliament, other individuals and organizations that have mounted pressure. They pointed out that banks were simply not fulfilling their roles or were not being helpful to this growing and creative sector.

There have been significant movements in terms of bank policies with the creation of a small business trouble shooter all banks now have in place. It is somebody to phone, to complain to or to ask questions about why a loan was turned down. There is much greater sensitivity in terms of funding women entrepreneurs, women business persons and aboriginal borrowers.

It is not that I think banks are not particularly creative themselves. They are responding to public pressure. They now realize these are areas they have to move into. Perhaps a little less altruistic, they are responding to the fact that as First Nations peoples settle land claims vast amounts of money may be involved. I suspect some banks are looking forward to getting involved in that operation as a financial growth possibility and perhaps have more of an interest in funding aboriginal enterprises. Nevertheless, in reality there is positive movement in all those areas.

I point out what I think is a particular problem area. Again I acknowledge there have been some improvements in the last little while. The government's procurement programs have assisted a number of small enterprises in my own constituency. A variety of programs assist small businesses to develop new technologies. Hopefully we are looking forward to the information highway strategy. It is not only necessary but will be helpful in the development of small enterprises.

There is a need for more flexible financing, particularly in some critical areas of growth in the country such as the tourism or hospitality business. One situation that brings this to mind in my own constituency is an operation called Mike Wiegle Heli-Skiing Operations. It has been in operation for many years. It is a very successful heli-skiing operation that caters almost exclusively to overseas skiers from Europe who come for a week or two to ski down the glaciers of the mountains in central British Columbia. It is superb skiing. To set up a major resort in an isolated area far from airports or population centres and to obtain financing arrangements that allow some flexibility is extremely difficult. The Western diversification fund was helpful in the start up period, but if we are to assist businesses to expand into new areas and if we are to be successful, we have to find ways to be more creative, and I aim these comments particularly at financial institutions.

The legislation is pathetic. I will not say much about it. Enough has been said. It will go to committee. It is a continuation of the same. It is certainly helpful. The SBLA has been helpful to many small business operators across the country including the Kamloops region, but there is much more we could do.

Let me summarize by indicating a critical initiative we need to take. When I say "we" I do not mean as a Parliament or as a government; I mean as a country. We all acknowledge that for a business to be successful or perhaps even for an individual to be successful there has to be some kind of plan, strategy or blueprint. There has to be a flexible business plan that acknowledges changing times and so on.

We need something similar as a country. We could call it the business plan for Canada. We could identify areas where obvious growth potential exists and where we would be putting our special efforts as federal, provincial, regional and local governments, financial institutions, business organizations, investors and entrepreneurs.

We can look around the world at countries that have been more successful than ourselves when it comes to economic development and job creation. It tends to be countries that have a business plan in place which everyone acknowledges. Maybe they do not agree with it but at least it is acknowledged. It sends a signal to banks of the direction of the country for the next decade. It signals entrepreneurs and investors of a direction, whether it is in pharmaceuticals, agri-business, tourism or whatever.

Some kind of national Canadian business plan would be appropriate. Then we would have to find out where we fit into it. What role would the federal government play, if any? What role would the provincial and regional governments play, if any? I suspect there would be significant roles. With that plan we would be much more successful.

Granted, this is most successful with smaller countries in which it is a lot easier to come up with a consensus in terms of direction and development. We are the second largest country in the world geographically and it causes problems that we are experiencing

virtually as we speak. It is something we must look at, and it would be a business strategy for the country for the next decade or two.

I will take leave and look forward to committee work and to debating the bill at third reading.

[Small Business Loans Act, October 26th, 1995]

Mr. Speaker, I had the good fortune to visit my hon. friend's constituency this past summer. I concur that it is one of the most spectacular parts of the country.

I visited a number of business people in her constituency. One runs a small hotel or lodge and has been trying to sell it for about

15 years. He would find a potential buyer and they would try to arrange financing. He found the difficulty was that he lived in an environment that often was rather vague in the minds of southern bankers. It is dark for half of the year and has an unusual tourist season. It was not clear what the season was, whether it was summer or winter, and consequently, the individual could not get financing.

My question in a sense is a take-off from my hon. friend for Broadview-Greenwood. When it comes to financing, particularly with respect to tourist related enterprises in the north, does the hon. member agree it is a major area and that financial institutions simply do not have the financing mechanisms in place to meet the demands and needs of the emerging northern economy?

[Bill S-9, October 18th, 1995]

Mr. Speaker, do we as members of Parliament and does the public generally have any idea what Bill S-9 is all about?

At a time when funding for Canadian colleges, universities and institutes is being reduced through cuts in transfer payments, the House is about to pass legislation today that will see Canadian taxpayers funding United States universities and colleges.

Yes, Canadian taxpayers will be able to support American colleges and universities. Bill S-9 will enable Canadians to donate funds to any college or university in the United States and then be able to deduct these contributions on their tax returns. Canadians will now be able to donate money to Harvard, Stanford, UCLA or Eastern Arkansas State College and then deduct these contributions on their Canadian tax returns.

Why are Canadians being asked to subsidize U.S. colleges and universities at the same time when support for Canadian post-secondary institutions are being seriously underfunded?

[Canada-United States Tax Convention Act, 1984, October 17th, 1995]

Mr. Speaker, I am very happy today to rise in support of the motions of the member for Gander-Grand Falls. I have always been impressed by him. He is one of those rare individuals who inevitably speaks his mind. He does his homework, analyses legislation and makes up his own mind about whether it is good or bad. For some members that seems to be a rare piece of behaviour.

What is the bill all about? What are the motions all about? I have to go back to Kamloops at the end of this week. Whenever I do that I go to Main Street and have coffee with a few of the folks who ask what has been going on in Ottawa. What has the government been up to? What legislation is before the House? What is the government dealing with? What are the priorities of Parliament and so on and so forth? Part of my responsibility is to reflect as accurately as I can what the priority is. They will be perplexed when I tell them about all of the challenges that confront us as a great nation.

Here we are almost on the eve of a major referendum about the future of the country and there are horrendous economic, social, cultural and environmental problems confronting us from coast to coast. I have to tell my constituents the government's priority at this time is to bring forth a piece of legislation that will benefit only the very wealthiest families in the country in terms of their tax returns.

Just the other day a major report in newspapers across Canada indicated that 75 per cent of Canadians willfully carry out their business transactions in cash to avoid paying income tax or sales tax or whatever. In other words, 75 per cent of Canadians are participating knowingly and up front in the underground economy. Are they doing that because they are tax cheats and because they participate in illegal and unethical activities? No. They have lost faith in the integrity of the tax system of the country. They see all kinds of people who do not pay their fair share.

There are small business investors and small business entrepreneurs who are struggling and who see all kinds of tax breaks going to large corporations but none to them. They are working 60 and 70 hours a week and are struggling to get by, and they see tax breaks going to certain firms, not to small firms, and to certain Canadians but not to the ordinary Canadian.

What does this tax provision do? Let anybody in the House stand up and argue after I sit down, but this is designed for the wealthiest families in the country.

I wish my friend for Broadview-Greenwood were going to vote differently, but at least he is speaking up for what he believes in, which is more than most people in the House are doing on this particular occasion. Why are Canadian taxpayers being now asked to subsidize those families that want to educate their sons and daughters and family members in the United States? That is what this does. That is what the member for Gander-Grand Falls is saying. That is what the provision is.

Those people who are sending their sons, daughters and other family members to American universities will not even have to be on the short list any more. For any college or any university in the United States, tax credits are available for any donations made to the foreign university or college.

Why should struggling Canadian taxpayers and small business operators in the country be subsidizing American colleges and universities? Why should hard working men and women be subsidizing American colleges and universities? It does not even matter what their credentials are. They could be colleges that simply hand out PhDs or masters degrees for the price of a few dollars. Any American college or university is eligible to receive donations from Canadians and they will receive a tax credit for that.

How can my friends in the Reform Party support this kind of provision, which is so unbalanced in terms of fairness? This will cost us money. It will cost the taxpayers of Canada hundreds of millions of dollars every year from now on. If we were a wealthy nation and had all kinds of extra coinage, perhaps we could consider this. I ask my friends in the Reform Party, who remind us regularly about their concern for the deficit and debt of the country, why they are supporting a piece of legislation that will drain hundreds of millions of dollars out of the treasury every single year.

I have been listening carefully to the debate. I could not listen too carefully when the bill was in the Senate because it went so quickly. Quite frankly, it is going awfully fast in the House. It is a tax provision, tax reform for the wealthiest people in the country, for the elite of Canada. Is this our priority? Yes, it is. Is comprehensive tax reform taking place at this time? No, it is not. Is it called for by every single Canadian man, woman, and child in the country? Yes, it is. What are we doing? What is the government doing? The government brings forward a piece of tax reform via the Senate that will harmonize certain corporate tax structures with the United States and bring in provisions that are absolutely astounding.

I would like to hear from my friends opposite before the debate ends why we are subsidizing American colleges. Why are Canadian taxpayers subsidizing American universities? Why do we consider it a priority at this time to give tax breaks of hundreds of millions of dollars to the wealthiest families in Canada?

My friend from Broadview-Greenwood, an individual for whom I have much respect, asks whether it is really a priority at this time to be passing tax legislation that will benefit people who have investments in the United States in excess of $600,000. I

suppose we could feel sorry for these folks. If you have investments over $600,000, the tax system could be more to your advantage. How many Canadians do we know with investments in the United States in excess of $600,000? A lot of people might have a cottage, an apartment in Florida or in California or someplace. How many people are worried today in terms of their financial realities who own $600,000 worth of real estate in the United States or have $600,000 worth of investments in the United States?

I say to my friends opposite in the Liberal Party, is this your priority? Are these the Canadians you want to go to bat for today? What about the people at the food banks who are lining up this afternoon? What about the single parents who are struggling simply to make ends meet? What about the small business operators in this country struggling daily to simply put food on the table for their families? Why are you not bringing in legislation for them?

I am referring to the second amendment which tries to bring at least a shred of credibility to this debate. As my hon. friend from Newfoundland has indicated, it is not perfect; it is sort of half a loaf because it says we are to limit this tax break to the year 2000. I see this as a bit odd, but I think it is at least going to end this particular tax buffoonery that is going to benefit a handful of very wealthy Canadians, at least to the year 2000.

When I go back to Kamloops later this week and I have to explain to the people on Main Street in Kamloops, struggling business people, people who are struggling simply to put food on the table and unfortunately an increasing number who find themselves out of work, jobless, that this somehow is a priority of this Parliament and this government, they will shake their heads in disbelief and say that this place has lost touch with reality, that this place somehow deals in some Walt Disney version of the real world.

I look forward to hearing other participants in the debate explain why on earth this is a priority.

I say in conclusion to my hon. friend from Gander-Grand Falls, thank you for standing up and putting forward two amendments today that will bring at least some sanity to this legislation and indicate on your behalf and a handful of your colleagues your disgust with this legislation as well.

[Tobacco, September 25th, 1995]

Mr. Speaker, my question is for the Prime Minister, who like all members is shocked by the fact that 45,000 Canadians die each year as the result of illnesses related to smoking.

Will the government stop giving the tobacco companies special treatment and include them under the Hazardous Product Act?

Failing that, will the Prime Minister invoke the notwithstanding provision of the Constitution to overrule the recent decision by the Supreme Court? Surely 45,000 deaths a year is a good reason to use the notwithstanding clause.

[Royal Canadian Mounted Police, September 22nd, 1995]

Mr. Speaker, what is happening to Canada's finest?

Most Canadians were shocked to learn that the RCMP had joined with Disney in an effort to promote both of their images at home and abroad. However, what about the picture in today's Globe and Mail : six scarlet clad Mounties at the New York Stock Exchange on Wall Street, rented by a private oil company to promote its new stock listing on the New York Stock Exchange.

The company also planned to use these rented Mounties to generate more publicity for its stock by having them chauffeur late night talk show host David Letterman to his studio. However this was nixed at the last minute, not by the RCMP but by Actors Equity which claims the Mounties were not professional actors.

Is the RCMP now renting out members of the force to raise much needed budget funds or is it spending time back in Canada fighting crime? While its members are on Wall Street they are not fighting crime in Canada which is their mandate.

[Customs Act, September 21st, 1995]

Mr. Speaker, I am pleased to have an opportunity to say a few words regarding Bill C-102.

At a time when too many Canadians are out of work, too many Canadians are underemployed and too many Canadians who are employed find it a struggle to make ends meet as a result of low paying jobs and so on, in the service sector particularly, Bill C-102 is a step which will facilitate expansion in the manufacturing sector. It will have a direct bearing on an increase in future jobs. In that sense we see there is an upside to this legislation which will be helpful to people from coast to coast.

I was pleased to find that Bill C-102 enables customs officers to spend more time with clients. This is much needed. A constituent of mine, Tony Walters, was visiting in the American southwest not long ago and when he came across the border into Canada he indicated to the customs officer he had bought himself a pair of riding boots made of armadillo skin. The customs officer said he would have to keep the boots and examine them. My friend asked if there were any problems. The officer said he did not think so but that he had to confiscate the boots, which he did.

Nothing happened. My friend some weeks later inquired and the officer said: "We notice there are armadillo skins on these boots and we think they might be an endangered species in the future". My friend said: "Fair enough, but at the moment they are not an endangered species and there is no reason I cannot collect my riding boots". He said: "You will have to wait and check with the minister".

I checked with the Minister of National Revenue, who is responsible for customs, and told him of the plight of my constituent. The minister said he would look into it but unfortunately that is the last I have heard of it.

I did receive a call from my constituent who informed me he had received a letter from Canada Customs saying it had burned the boots. My friend was not pleased. He felt they were legitimate riding boots, a legitimate import. They cost him a couple of hundred dollars and they had been burned by Canada Customs. He felt he was due some compensation. It seemed to me he was right in that assumption. Perhaps the Minister of National Revenue is out there listening and will once again address this matter. As I said, unfortunately I did not hear anything back from him once I brought it to his attention.

Bill C-102 moves us in an encouraging direction by eliminating more than 1,500 manufacturing input tariffs. It will be good for the expansion sector. However, what has driven this bill is the NAFTA. This will bring our tariff schedules in line with American manufacturers in an effort to obtain a more harmonious or level playing field in the manufacturing sector between Canada and the United States. We have had the NAFTA debate and it is over.

I will register a concern which I, my party and increasing numbers of Canadians have. I do not want to say anything against our American friends but is it wise for an exporting country to put so many of its eggs in one trade basket, to link itself so inextricably, intensely and extensively with one country?

I think we can all acknowledge that now for all intents and purposes economically speaking we are the equivalent of an additional U.S. state or territory. Our economy and the economy of the United States is inextricably connected. That makes us very vulnerable to economic occurrences in the United States. If its economy starts to falter the ramifications will ripple through our economy within minutes.

I know many members of the House are enthusiastic supporters of the NAFTA and what that means and that we are now nothing more than an economic extension of the United States.

In our long term best interest as a country is it to our economic advantage to put all of these trade eggs in one basket? Will our children and grandchildren benefit from this initiative? I do not think so and I raise that as an extension of the debate on Bill C-102.

On balance we support this legislation. I particularly like the idea that the duty exemptions for travellers have been increased. As I recall, the last increase was in the early eighties. Now travellers will be able to bring in goods duty free to reflect these changing times. I still think they are too small. However, it is a step in the right direction.

My friend from Calgary Centre raised the point that one of the motives behind this legislation is to bring our tax regime in Canada more closely in line with that of the United States. He expanded to say it would not only be in terms of tariffs and so on but also our corporate and individual taxation systems.

He mentioned theirs was somewhat lower than ours in Canada. I noticed the Minister of Health is here. One reason our tax system is somewhat higher than in the United States is a reflection of some of the benefits we obtain because of our tax system.

I had the good fortune two years ago to spend time on a formal visit to the United States. Part of that visit included a visit with an American family every evening to talk about life as it saw it and to provide an opportunity for it to meet a Canadian to hear about what life in Canada is all about.

One of the questions I asked every evening for 28 days in succession concerned what that family paid for health care, what the cost for that family was. In every case the cost of health care, not to the same extent we have in Canada but at least close to it, varied between $5,000 and $7,000 per family. That is what it cost them out of their pockets each year. That was a system through

which all sorts of medical services were deductible. If someone had their tonsils out they might have to pay a $500 deductible.

While we discuss taxation-goodness knows we are doing it today and I suspect we will be doing it for many weeks beyond this-as we work to compare the tax regimes of the United States and Canada we should always keep in mind the relative benefits citizens in each country receive as a result of those tax regimes.

(Motion agreed to, bill read the second time and referred to a committee.)

[Canada-United States Tax Convention Act, 1984, September 21st, 1995]

Mr. Speaker, I want to respond to my friend. He might be playing a little bit of politics here, but I think it is a question that deserves a serious answer on my part.

How has our accumulated debt occurred? Fifty per cent of our accumulated debt comes from the result of compound interest because of our high interest rate policy. Forty-four per cent of our compound debt is as a result of tax exemptions. Six per cent of our compound debt is as a result of government expenditures.

Let us recognize that in some areas we have overspent, but in my judgment in some areas we have underspent. There are some areas where we should be spending now to encourage people to find ways and means of getting back to productive work. Let us

recognize that the best social program in this country is for someone to have a decent paying job.

[Canada-United States Tax Convention Act, 1984, September 21st, 1995]

Mr. Speaker, this could be one of the happiest days of my life, responding to this question.

If there is an issue facing this country right now, one of the top issues that is frustrating Canadians is the matter of our unfair, unjust, biased tax system at both the corporate and personal levels. A major overhaul is required. For us to go into the details of why that is the case, they are all well known. I suspect we have all had constituents lined up 50 or 60 deep some days explaining their problems with the tax system.

I can commit to my hon. friend from Broadview-Greenwood that there is nothing I would enjoy more than to sit down with him and others in a non-partisan effort to examine every tax provision that presently exists on a cost benefit basis to the people of Canada and come up with a comprehensive system of tax reform that would bring fairness back into the system. People would see the tax system as being fair to both them and others, where there would be nobody who would obviously benefit from that system.

I know some of my friends are very keen about the flat tax system. I am not sure what they mean by the flat tax because there are all kinds of definitions of that, as my friend from Broadview-Greenwood has explained in his publication and others beyond what he said. However, it is something we need to look at among a whole set of alternatives and various proposals to have a fairer tax system so that the most popular book come the new year is not on how to avoid tax.

When we go into bookstores across Canada, no matter what bookstore it is the front counter now has issues and issues and various publications on how to beat the tax man. The reason they are popular is because every single person and business person knows that the tax system is unfair.

I will use one example to measure the unfairness in how the tax system is being used. The audit division of Revenue Canada tells us that for every $1 it invests in an audit procedure it collects $6 back. It is not necessarily that people are all breaking the law, but they are certainly hedging on that. In other words, they are saying that this does not seem to be clear so I am going to make my tax decision in this grey area. As a result, the treasury of our country is losing billions of dollars that would normally be collected. However, because of a tax system that is so vague, so grey, so biased, so unjust and so unfair, people are revolting against it in a number of ways.

Let us not forget that the obvious way the people are revolting is to participate in the underground economy. What are the losses there? The experts will tell us that anywhere from $40 billion and $160 billion are lost each year because of transactions that are not registered and not taxed as a result of the underground economy.

Therefore, I say with enthusiasm, in response to my friend, yes, I will be willing, with my party very strongly behind me, to participate in any measure that will result in a fairer tax system than we have today.

[Canada-United States Tax Convention Act, 1984, September 21st, 1995]

My friend from Calgary says 1 per cent. I doubt it is one per cent. We should not be giving priority to tax policy that addresses the concerns of less than 1 per cent of the Canadian population.

My hon. friend from Calgary Centre made a point that was well taken. He said that most times when we are trying to change the Income Tax Act we use the normal process through the finance committee and various other subcommittees to look at tax exemptions and ask whether they are of benefit to Canada. My friend from Toronto will know about this; he has been working on them for many years. Do they result in some benefit? Often when we have done a cost benefit analysis we have found that they have not. From time to time the government has eliminated tax exemptions or what some of us call tax loopholes. Even the Minister of Finance is using the term tax loophole more frequently.

We ask ourselves how we got into this debt problem. I know it seems to be a jump from Bill S-9 to the debt problem. Let us recognize that Statistics Canada did us a great favour back in 1991 when it identified that 44 per cent of our accumulated federal debt was the result of tax exemptions over the years, the drainage of billions and billions of dollars through tax loopholes.

We might say that some of the tax breaks, tax loopholes or tax exemptions are beneficial. Some are absolute boondoggles and some are debatable. Do Parliament and government give priority to a process that would see the elimination of some tax exemptions and as a result take a major step toward reducing the accumulated debt and deficit? Is that where we devote our attention, energy and time? No. Time is given to Bill S-9 that will benefit a handful of the wealthiest families of Canada. We will send this off to the finance committee now for thorough study where its advantages and problems will be identified.

In summary let us acknowledge what we are doing today. We are taking up valuable House of Commons time at a crucial time in our economic history, when we have 1.4 million Canadians who are jobless, another two million Canadians who are underemployed, probably many more than that who are working in low paying jobs and are barely getting by. We are seeing that a priority for this government is to assist a handful of wealthy families with their tax problems.

What about the tax problems of every other Canadian? What about the tax problems that every small business person in this country is struggling with today? My friend from Calgary Centre indicated that people are struggling through their tax returns and so on and need a tax accountant, a tax adviser, a tax lawyer for the simplest type of taxation situation.

It is with regret that we have this debate today, because of all the priorities facing this country this has to be almost at the bottom of

the bloody list. However, the government says this is a priority, so to them it is and we have to deal with it.

Let me say that on the principle of this bill we in the New Democratic Party will be voting against it.