Rick Borotsik

[Agriculture, October 8th, 1998]

Mr. Speaker, according to StatsCan farm cash receipts in western Canada are down drastically in 1998. In 1997 net farm income fell 55% nationally.

Farmers have started to draw money from their net income stabilization account. For the six months of 1998 NISA withdrawals increased by nearly 70%. Most farmers will not be able to face the current market crisis.

Of greater concern is that while governments of our major competitors, the EU and the U.S., declare that they will help their farmers go through this crisis our government is not reacting to our problems.

Since 1993 federal and provincial government support has dropped 60%. Farmers want a long term commitment from the government and the government must react now.

[Canada Small Business Financing Act, October 2nd, 1998]

Mr. Speaker, I will try not to be quite as partisan as the last two speakers who rose to speak to Bill C-53, the the Canada small business financing act. Perhaps later on I will explain to the hon. member from the NDP that there are provincial governments across this country which do have the proper policies in place to encourage small business.

Make no mistake about it. Small business is the backbone of the Canadian economy. It is the small businessmen, the small businesswomen and small businesses themselves which hire people and give them the opportunity of having employment in our economy.

It is those small businesses which have to be assisted in some fashion in order to identify and achieve the necessary working capital and the operating capital that is required to develop and start a small enterprise or a medium enterprise, referred to as SMEs.

As a matter of fact, it was the 1961 Progressive Conservative government of John Diefenbaker which introduced the first legislation concerning small business, the Small Business Loans Act. For over 37 years it has helped small businesses achieve those finances that are absolutely required to put them in place and help the Canadian economy.

Quite frankly, I should say off the bat that the critic for our party, the hon. member for Markham, obviously agrees in principle with the legislation that has been put forward.

However, there are, as there are in every piece of legislation, problem areas. At committee stage it is hoped that the amendments which will be put forward by the opposition parties will be listened to logically by the government because, quite frankly, no government has a lock on ideas on how to make legislation better.

Logical amendments that should be put in place will come forward in committee to make this piece of legislation better.

First I want to talk about small business in general. Perhaps the hon. member from the NDP, who attacked other provincial governments and policies which they have put in place, may well want to listen to this.

In the province of Manitoba small business is appreciated for what it really can do. Let me give some ideas and examples of what has happened in my province just recently in developing what I consider to be a business friendly environment, something which has not happened, as was mentioned earlier, in the province of British Columbia. In fact, businesses are being chased away and are leaving in droves the province of British Columbia to go to other business friendly environments.

Let me talk about the environment in Manitoba which now has, if not the best, one of the best economic opportunities of the last century.

Part of the business friendly environment involves taxation. Taxes in the province of Manitoba have been reduced.

Workers' compensation assessment rates have fallen by 22% since 1988, the time of an NDP government, and will fall a further 5% in 1999. A regressive payroll tax has been reduced in the province of Manitoba.

The payroll tax exemption has increased from $100,000 to $1 million. That means that small businesses which have a payroll less than $1 million will be exempt from a regressive payroll tax in Manitoba.

The payroll tax rate will decline from 2.25% to 2.15% in 1999 which means that those businesses whose payroll is over $1 million will pay less in payroll taxes in 1999 than they do currently. That is another reduction of a regressive payroll tax.

The capital tax exemption has risen from $1 million to $5 million which means there is a reduction in capital taxes to small business enterprises. That makes it much easier for those enterprises to do business in the province of Manitoba.

The retail sales tax has, since 1991, been applied alongside the federal GST. It was previously applied on top of the federal manufacturers sales tax. We do not have to go into the benefits of the GST, which removed a very regressive manufacturers sales tax and which made our ability as Canadians to compete with international markets much easier and much better. This tax was implemented by the Progressive Conservative government and then embraced by the existing government, which said “We will scrap the GST”. The GST was not scrapped and is now an unnecessary evil.

Electricity used in mining and manufacturing activities in Manitoba is now sales tax exempt. I wish the NDP government of British Columbia would listen because these business friendly improvements were made in the province of Manitoba to increase, not decrease, the economy of the province.

When we talk about small and medium enterprises it is necessary to recognize that they are the economic backbone of our country. The people who we see walking in the streets are the people who are employed by these corporations. These people pay substantial taxes to the federal government. I mention this because the government not only has an opportunity under Bill C-53 to make it easier for small and medium enterprises, it could also make it much easier for those same enterprises if it would embrace the concept of less taxation.

There is a prime opportunity before us, which is the reduction of EI premiums. Over the last two weeks in the House we have talked about what should happen to the $19 billion surplus in the EI account. We have heard from the government that the surplus is going to be used in whatever way it sees fit, for education or health care or whatever.

The government has a responsibility to look after education and health care. It has done a very poor job by reducing by $6 billion the transfer payments that should be put into those services which Canadians wish to have. That does not mean that the moneys that came from the EI fund, an insurance fund, should be used for those purposes. The law states that when there is a surplus the surplus should be returned to those people who invested in the fund.

The EI premium for employers is $3.78. The break-even rate that has been calculated for the EI employment premium contribution is $2.58. Currently $3.78 is being charged per $100 of earnings. A reduction of $1.20 could be put in place now for employers.

What are we talking about in Bill C-53? Small businesses which employ people. Reducing EI premiums would be a way to allow dollars to go back into those businesses. It would allow those same owners to hire more people, to produce more product, thus enhancing our economy. Not only does this apply to the employer. EI premiums for employees are currently being charged at $2.70 per $100. The break-even rate for employee EI premiums is $1.83.

EI premiums for employees could be reduced to $1.83. But no, the government likes to have a $6 billion to $7 billion annual surplus, raised from the taxes of not only the employees but the employers. Now the government has the opportunity to use it as a slush fund for wonderful political projects which, quite frankly, do not do one iota of good for the small businesses which are paying all those costs.

Not only is it unfair, I believe that under the act it is illegal. I am sure the Minister of Finance and the government will change that in order to use that money as a slush fund.

We have a necessity to assist small and medium size enterprises. Right now we have this piece of legislation before us. It is good legislation because it was put in place by a good government in 1961. However, legislation has to be adapted as the years go by. Things have changed over the last 37 years and we have to adapt.

Unfortunately the government has not adapted quite enough with Bill C-53. Having it go to committee is the right thing to do. But the very right thing to do is to have the government listen when it goes there, to have the government listen to very good amendments from the Progressive Conservative Party so that we can make this legislation better.

Let me give one example of an area where the government does not have the vision to look forward to how business should be done in the future. I am talking about the knowledge-based industries. If members of the government or members of other opposition parties actually talked to their constituents, their businesses and the people, they would recognize that achieving working capital and operating capital for a nuts and bolts business is easier than achieving that same capitalization for a knowledge-based industry because with a knowledge-based industry the asset is intellectual.

It might be difficult for government to understand that. I can appreciate that, but I am sure that in committee we will be able to lay it out in simplistic terms so that it will understand that with the intellectual asset requirement in small businesses we have to change the way we do business.

The Minister of Industry has actually stood in this House and said that he embraces the knowledge-based industries. But there is nothing in Bill C-53 that will achieve that. What we have to do is make sure that the government recognizes that and adds to this piece of legislation the ability for intellectual properties and knowledge-based industries to be treated equally, as are other types of small businesses trying to achieve the necessary working capital for their industries.

As I said at the outset, we agree in principle with Bill C-53. However, we would like to see some of those necessary changes. There are some minor changes and there are some major changes, as I mentioned, concerning intellectual properties.

This is only one small part of what it takes to achieve success for our small businesses. I would like to suggest very strongly that it is necessary not only for the Minister of Industry to make the changes, but for the Minister of Finance to make the necessary changes to make sure that we are successful in keeping this very vital part of our society in business.

The member from the Reform Party talked about the agricultural sector. I, too, am very familiar with that as I have been very familiar with small business for most of my working life. There is no doubt and no question in my mind that the agricultural industry in this country right now is being adversely affected by a number of factors.

One obviously is the major global economic downturn, particularly in Asian markets. Agricultural industries are also being affected by an ineffectual government. We must ensure that trade deals which have already been negotiated are complied with. It is not happening, as we see now in the northern states of the United States. In fact governors, unilaterally, are suggesting that we are not complying with our own rules of trade, which is not the case.

The government of the day is ineffectual in making sure that those states comply. It is affecting my producers and our country's agriculture industry. That is only another part of how this government has unfortunately neglected small business in the agriculture industry.

We can talk about a number of other things with respect to agriculture but at this time I will suggest only one thing. We would like to see the government have an open mind when this legislation comes back to the House and when it is dealt with at the committee level. Our critic, the member for Markham, will be at the committee table. I hope the government will listen with an open mind.

[Agriculture, October 2nd, 1998]

Mr. Speaker, the minister would probably have done just as well having those discussions with my mother as the secretary of agriculture for the United States.

As early as last night the Governor of South Dakota, Bill Janklow, said that he will not give up his dispute until the U.S. sues Canada for unfair trading practices.

Is the minister simply going to sit back and hope that Secretary of Agriculture Dan Glickman is going to solve the problem?

[Agriculture, October 2nd, 1998]

Mr. Speaker, as we all know there is a nasty trade dispute going on between Canada and the United States agriculture. In our committee yesterday a senior trade official said that this was not unusual during state governship elections, that this always happens.

Did the minister of agriculture not see this trade dispute coming? If he did, why does he not have a contingency plan to help save our producers?

[Special Import Measures Act, September 25th, 1998]

Mr. Speaker, it is rather enjoyable that I rise to speak to Bill C-35, an act to amend the Special Import Measures Act.

As the hon. member of the New Democratic Party indicated, major changes have taken place in international trade since the Special Import Measures Act, SIMA, was passed in 1984. The Canada-U.S. free trade agreement, the NAFTA and the WTO agreements are but a few of the major changes. Quite frankly, it was the Progressive Conservative Party which recognized that globalization and global trade was absolutely necessary. If Canada was to retain its high standard of living, it could only be done with rules of trade being set for our trading partners.

The purpose of Bill C-35 is to reflect the changes that have occurred in international trade, especially relating to the anti-dumping measures which protect Canadian industries against potentially unfair practices by our trading partners.

In 1996 a special joint committee on the review of SIMA was struck between the Standing Committee on Finance and the Standing Committee on Foreign Affairs and International Trade. Both the Bloc and the Reform have written dissenting reports.

It is ironic that the Reform Party's minority report states “We urged the government to resist the demand for getting tough measures with the Americans”. I find that terribly ironic for the simple reason that we are now dealing with a very specific trade dispute in agriculture with the Americans. That same party, which suggests it represents not only the west but agricultural producers, is saying not to go with Bill C-35 and, if we do, let us make sure it is not very tough on our American trading partners. If this is true, the Reform Party must be suggesting that we do nothing about the situation affecting western Manitoba and South Dakota.

I believe we would not have to get tough with Americans if this Liberal government had some influence with its American counterparts. Trade is not a science, it is a relationship that has developed between our trading partners. It makes sure that we have a good two-way line of communication. It makes sure that we have relationships developed with those trading partners and the officials of those trading partners to recognize when there are problems and to resolve those problems without having to go to the NAFTA or the WTO. That is obviously playing a bit of political hardball which, unfortunately, this government does not understand and does not know how to achieve.

The Ministry of Finance responded to the committee in April 1997, accepting about 16 of the recommendations by proposing Bill C-35. Changes to SIMA and the CITT act are intended to rationalize the investigative functions of Revenue Canada and the CITT to better reflect their respective areas of expertise. That was a very good recommendation and it is a very good suggestion within the body of Bill C-35.

Bill C-35 will also allow expert witnesses to play a more effective role in tribunal inquiries. Once again, that is a very positive way of developing trade defences within our systems.

Bill C-35 will also harmonize the way Revenue Canada and the CITT treat disclosure of confidential information. This is to enhance procedural fairness and transparency. It is a very good proposal within Bill C-35.

Bill C-35 will establish new penalty provisions to deter any unauthorized disclosure or misuse of confidential information provided in the SIMA investigation. Bill C-35 will make several housekeeping changes aimed at clarifying existing positions of SIMA and the CITT act, to name a few.

As the fathers of the Canada-U.S. free trade agreement and the NAFTA, obviously our party is in agreement with the broad thrust of bringing SIMA up to date to reflect the current realities of international trade. Since we know that dumping and subsidization are measures still used by foreign governments, we see that there is still a need for SIMA to protect Canadian industries from unfair practices by our trading partners.

However, we have to ensure that laws such as SIMA are reviewed periodically to ensure they achieve the purposes for which they were passed. Rapid developments in international trade can make these laws obsolete and counter-productive very quickly.

More specifically, we are happy that the government agreed to recommendation No. 2, which requests Revenue Canada to take concrete measures to ensure fair and equal access to the SIMA process by small and medium size Canadian producers. This is extremely important as the majority of our economy and the jobs developed in this country are done by small and medium size businesses. That will be implemented through improvements to administrative practices and I appreciate that in fact this bill speaks to that.

It is rather interesting that we are discussing Bill C-35, changes to international trade and corrections to our defence mechanisms because today we are dealing with a very specific issue of trade in western Canada.

Agricultural products in western Canada amount to in excess of $10 billion per year for western Canadian producers and Canadian producers in general. Currently we have a situation in western Canada where there are a number of northern states which are impacting Canadian trade going into the United States of America.

I am very disappointed that the Reform Party in its dissenting report would say “Let us not get tough with our American trading partners; let us politically try to work this out”. Obviously that has not happened because of the ineffective politics that have been practised by the Liberal government.

There are currently non-tariff barriers that are being set up by some governors in the United States. This can be dealt with in fashions other than going through the very lengthy process of the dispute mechanism, going to the WTO and the NAFTA, which the government has been waffling on for the last six months. As of yesterday the minister responsible indicated, by patting himself on the back, that yes we have now filed with the WTO and the NAFTA. The minister indicated that this would be a 10 to 15 day process. That is not factual truth. That simply gets the complaint to the table. There is a long term process with this particular dispute mechanism and it could take months to resolve it.

Western Canadian producers do not have months. They have only days. They sometimes have less than that in order to make sure their product gets to market.

I am very disappointed that the rules which are already in place are not being upheld by our American trading partners. But what it does speak of is the fact that we need rules. It would be terrible if we did not have international trade rules which we could follow. Sometimes people break rules. Sometimes trading partners break rules, as has been identified over the last couple of months with the South Dakota situation.

What we need are rules. Bill C-35 provides a substantial number of those rules on which we as Canadians can depend to protect not only our industries here in Canada, but our exports outside the boundaries of Canada.

I am very pleased to say that Canada has developed global trade. Unlike my colleague from the NDP who suggests that the NAFTA and the Canada-U.S. trade agreement were the worst things that ever happened, I would disagree with him. Because we were not only a partner to those agreements but we were the authors of them, Canadians have a higher standard of living, with the exception of more taxes being paid to this particular government. But I will not get into that particular area.

All of the dollars that are being generated seem to find themselves in the coffers of the federal government, which is not the best place to have them, but that is a debate for another time.

There are 32 million to 35 million Canadians and we require international trading partners in order to sell what we produce outside our domestic marketplace. There is no question that if it was not for the international marketplace we would not have what we have today.

However, if we are to open up the international marketplace there must be rules to that trade. The rules to the trade must be very specific. We have done a very good job with the NAFTA, the Canada-U.S. agreements and the WTO of setting the rules so that Canada will be the benefactor. We have done it very well. I am very pleased to say that happened, in most cases, because of the previous Progressive Conservative government.

Canada must provide its business community with the tools it needs to face international competition. Most important, our ultimate efforts should support the efforts to move forward, eventually making such trade remedy unnecessary. It would be very nice if everybody followed the rules. Ultimately, hopefully, all will follow the rules and this act will not be necessary.

We need to continue trade negotiations with our partners. The South Dakota trade dispute is one recent example which clearly shows there is a need for more work to be done in our trade relationships. In 1999, with the WTO negotiations, we will have a window of opportunity to achieve trade success. If the government develops a comprehensive plan and does not leave things to the last minute, as it did with Kyoto, success can be achieved if there is the political will to do so.

This party supports the amendments put forward in Bill C-35 to amend the Special Import Measures Act.

[Employment Insurance, September 25th, 1998]

Mr. Speaker, I have to admit I am shocked to hear the secretary of state admit today that the funds have been put to different uses other than for what they were intended which is employment insurance.

I have an e-mail sent by the chief actuary who says EI premiums must be reduced, it is the law. The law must be upheld. Is the secretary of state now saying they will not uphold that law but that they will break the law?

[Employment Insurance, September 25th, 1998]

Mr. Speaker, the employment insurance fund is an insurance fund. It is funded by employers and employees. The surplus must go to them.

Is the secretary of state aware that there is an Employment Insurance Act and the act is very specific that when there are surpluses the premiums must be reduced? Political expedience aside, are those premiums going to be reduced? Are they going to be used as general revenues as the secretary of state has indicated today?

[Canada Pension Plan, September 25th, 1998]

Thank you, Mr. Speaker, for having the secretary of state not have an answer.

The finance minister has made it clear that he wants to spend the surplus EI fund. There is absolutely no question about it. He wants new funding for new projects for the Liberal government and he wants it perhaps to pave the way for the leadership. Will the government give those dollars back to the employees or is he going to fire the person who suggested that they go back to the employees?

[Canada Pension Plan, September 25th, 1998]

Mr. Speaker, yesterday the top watchdog of the employment insurance fund sent an e-mail to all of his buddy actuarials around the country defending the former actuary of the Canada pension plan and calling for EI premiums to be reduced: “The simple way to return the UI surplus would be to just drop premiums which would help to offset the rising CPP costs”.

Could the minister of HRD tell us today whether the government is planning to fire the top expert of the EI fund for telling the truth the way it fired his colleague for the Canada pension plan? Is he going to be fired?

[Supply, September 22nd, 1998]

Mr. Speaker, it is nice to live in a world of naivety and I do appreciate that from the hon. member.

I spoke nothing of confiscation in my dissertation. I spoke of a piece of legislation that in my estimation and in the estimation of thousands of Canadians is unenforceable.

I appreciate the fact that the hon. member will register his guns. I thank him very much for that. I can also assure the member that there are law-abiding citizens in my area and in areas of western Canada who will not register their guns. They will be criminals.

Is my police force to go into those houses and look for those people who have not registered a long rifle and charge those law-abiding individuals? If they are, we will need substantially more police officers in our municipalities to do that.

I do not subscribe to a lot of the rhetoric that has come from these benches with respect to confiscation. However, I do know in my mind that if legislation is unenforceable then it is not good legislation and should not be on the books.