House of Commons photoWon his last election, in 2000, with 67% of the vote.
Air Transportation October 28th, 1999
Mr. Speaker, on June 23, the president of Air Canada informed me of the bid to acquire Canadian International Airlines' foreign routes. He did so out of courtesy.
The same thing happened the day before Onex officially announced its bid. Mr. Milton observed the same courtesy two weeks ago, when Air Canada made its offer. There is nothing unusual in that.
Supply October 28th, 1999
Mr. Speaker, I realize that my friend was not particularly enamoured with the fact that under section 47 the bureau was given an advisory role, but I think he will agree that the report which has come from the bureau in the last few days is a comprehensive one and certainly has helped us, helped me, in developing the guidelines which I brought before the committee on Wednesday of this week.
Does the hon. member not now fully appreciate the fact that under the framework that I announced the bureau will very much be back in the picture, approving the merger, every aspect of the merger, negotiating with any proposer who comes forward and that this is a very crucial safeguard on the very essential issue of competition?
Supply October 28th, 1999
Mr. Speaker, the hon. member heard Mr. von Finckenstein yesterday at committee. I would like to ask my hon. friend if he thought the Commissioner of Competition gave an impression of a man who had been sidelined, of heading an agency that had no effect and no real power. The fact is that no proposal has come forward in the 90 day process which therefore would have bypassed the bureau.
What I announced the other day was the fact that the bureau will indeed examine any proposal that comes forward and have its full rights under merger review.
Supply October 28th, 1999
Mr. Speaker, I would like to ask the hon. member for Cumberland—Colchester a question.
Is there not an inherent contradiction in what he just said? He has lamented the fact that under section 47 allegedly the Competition Bureau has been sidelined, yet in the next breath he praises the very report that we asked them to produce under the auspices of section 47. That is a contradiction. The fact is that the Competition Bureau is very much alive in this process, as I have outlined.
After the 90 days the bureau will be able to examine any proposal that comes forward with its full powers. Therefore, there is no question of the Competition Bureau not being involved in this debate. It will be doing its work and it will be doing that work very well.
Supply October 28th, 1999
Mr. Speaker, I listened to the member for Churchill very carefully.
The issue here is not of upholding the law. It is whether parliament, in its wisdom, should change the law. What we said the other day was that we were asking parliamentarians whether we should even consider changing the law. We should put the entire debate in the proper context.
Is my hon. friend saying that all laws are immutable and should never be changed to reflect changing circumstances in society? Is she saying that we should not even consider changing the law?
I will point out that Air Canada itself was the first to put in a proposal on August 22 under the auspices of section 47 of the Canada Transportation Act. We then had another offer which is currently on the table. This shows that the process the government has followed has worked.
Supply October 28th, 1999
Mr. Speaker, we have no intention of taking an equity stake in any of the airlines. The government got out of the airline business in terms of ownership some years ago, and we do not intend to go back. We intend to create the framework so that it can be a private sector solution which we will sanction through parliamentary measures and statute to ensure the public interest is maintained.
One of the key elements of that is to extract conditions in any deal that comes forward so that workers are indeed dealt with fairly and their rights are respected.
Supply October 28th, 1999
Mr. Speaker, with great respect, my friend has it all wrong. The fact is that the Competition Bureau will be very much involved in examining any merger and in negotiating with any successful applicant in the normal way. The Canadian Transportation Agency will be doing its statutory duty in seeing whether or not any proposition meets Canadian control regulations.
There are other issues that the agency and the bureau cannot deal with. They do not have the legislative competence to deal with these issues. Only parliament can deal with them. That is why we are proposing, in the sanctioning of any new agreement with respect to a dominant carrier, to have that enshrined in legislation so that the protections the Canadian public want will be in legislation which will be debated in the House. Parliament, on this entire issue, will have the last word.
Supply October 28th, 1999
Mr. Speaker, the hon. member kindly referred to cartoons. We in public life are used to being the butt of criticism. I know that the hon. leader of the Bloc Quebecois has had the same experience with cartoons.
I have said for the last year that we would consider any regulatory or statutory change if it improves the health, viability and stability of the Canadian airline system. We repeated that on August 13 when my colleague, the Minister of Industry, and I brought forward the section 47 order.
It is incumbent upon us to give every flexibility for the private sector to come forward with a solution. That is what we are doing, but we are not pronouncing on that particular issue. We are saying that we will consider raising that particular limit.
Supply October 28th, 1999
Mr. Speaker, I am pleased to take part in this debate on a motion moved by the hon. member for Laurier—Sainte-Marie.
This motion deals with one of the components of the policy framework on the restructuring of the airline industry in Canada, which I have tabled before the Standing Committee on Transport and the Senate Standing Committee on Transport and Communications two days ago.
The tabling of the policy framework that I made available the other day marks the beginning of the second phase of the government's effort to ensure that any eventual restructuring of the Canadian airline industry takes place in an orderly matter and with adequate means for ensuring that the public interest is met.
Since August 13, when the governor in council put in place the section 47 order, both Air Canada and Canadian Airlines, and any interested third parties, have had the freedom to develop and discuss any proposal which might lead to a conditional agreement.
Under this special process, three proposals have been advanced and two of them are currently on the table. Both these proposals present a private sector solution to the problems facing the airline industry.
The document I have tabled earlier this week lists a number of issues on which I seek the advice of my colleagues. The first issue is the one we are discussing today.
The government is asking the members of these committees to examine whether increasing the present 10% limit on Air Canada shares would contribute to a more vibrant Canadian controlled airline industry.
The motion before us today is to the effect that this 10% limit should not be changed. The government has not decided yet whether it should be changed or not. We believe the question should be a matter for debate in Parliament.
The policy framework which I made available this week situates the debate in a larger context. I think the hon. member for Laurier—Sainte-Marie has forgotten that. There is little doubt that we face a consolidation of the airline industry and the emergence of a dominant carrier, whether by means of a merger through common ownership or by other means. This has given rise to widespread concerns regarding the lessening of competition.
It is for that reason I solicited the advice of the commissioner of competition on August 30. He gave that advice this week. I would publicly like to thank him again for the consideration he has given to our proposals and to tell him, through you, Mr. Speaker, that we are guided by his report.
The vision that we have for the airline industry as we enter the 21st century is one that is safe and healthy, one that is owned and controlled by Canadians and one that serves all parts of Canada at fair prices and that is capable of competing with the biggest and best airlines in the world.
Our vision for the next century is that of a Canadian airline industry that will be safe and vibrant, owned and controlled by Canadians, serving all parts of Canada at fair prices and able to compete with the biggest and the best airlines in the world.
In articulating this vision and delivering this vision to Canadians, I want to make one point absolutely concrete here today, and that is the safety standards of the Canadians airline industry, which are admired throughout the world, will not be compromised one inch by the proposal that we have before us.
There is another very important factor in this debate. Fundamental to the identity of Canada is its linguistic duality. It is a reflection of Canada's unique culture and values that Canadians be able to rely on the national air carrier for service in either official language.
The government will ensure that the Official Languages Act continues to apply in the case of Air Canada or any future dominant carrier, and that the Act is effectively implemented.
Let me now turn to some specific elements in the policy framework.
The policy framework that I outlined clearly affirms that the government will ensure that the Canadian airline industry remains owned and controlled by Canadians. There will be no change to the legislative framework in this area. The 25% limit on foreign voting shares in any Canadian carrier will not be changed. The requirement to be controlled in fact by Canadians will not be changed.
The Canadian Transportation Agency has the statutory obligation to carry out an examination as to whether or not any proposal that comes forward does in fact meet effective Canadian control requirements.
The policy framework recognizes that Air Canada is subjected to another limit that only applies to that corporation, namely the 10% limit on Air Canada's voting shares that a single shareholder, Canadian or non-Canadian, can own.
Although this provision has ensured that this former crown corporation has been widely held, some have argued that this reduces shareholder influence.
As I said on Tuesday, the government is prepared to consider increasing the limit—and only to consider increasing it—to a new level to be decided following input from parliamentarians—after debate here, in this House and in the Senate, for example—if such a measure contributes to achieving a healthy, Canadian controlled airline industry.
We are pleased to take part in today's debate. However, we hope that the issue will be thoroughly reviewed by the committees of the House and the Senate in the weeks to come.
I would want the debate to include the question of whether preserving the 10% limit is part of the consideration of the public interest. One could argue that the best means of ensuring that the public is protected is through legislation and regulation, and not through the 10% rule.
The policy framework puts emphasis on addressing the issues which are of paramount concern to Canadians. In addition to Canadian ownership and control there are competition concerns, in particular predatory pricing, airport access, ticket pricing, continuation of service to small communities, and the rights and concerns of employees. All these matters must be taken into consideration.
Finally, I remind you that the government intends to introduce legislation very soon which will give it permanent authority over the review of any merger or acquisition affecting Air Canada or Canadian Airlines which is concluded from now on.
This formal review process, which is being put in place because of the importance of the airline industry to Canadians and to our economy, will involve the three elements of government oversight which are needed to fully capture the public interest.
The Competition Bureau will review specific proposals with regard to competition issues; the Canadian Transportation Agency will review proposals to ensure air carriers remain controlled in fact and in law by Canadians; and the government itself will ensure that transportation public policy concerns are addressed.
This process puts the final decision to approve a merger or acquisition with the governor in council on the recommendation of the Minister of Transport.
If a merger or acquisition is found to comply with the requirements to be owned and controlled by Canadians, as determined by the agency, the Minister of Transport will formulate the recommendation for approval, taking into account the extent to which the carrier has made undertakings to address the remedies negotiated with the Competition Bureau, and the conditions necessary to meet public policy objectives.
These are the cornerstones of the framework, but some work remains to be done before this framework can put into effect. That is why we have the debate in the committees. It is going on right now. It is going on in the Senate. We want to know the views of parliamentarians and we want them to reflect upon the conditions that we will extract from any new entity to protect the public interest.
Yesterday the leader of the New Democratic Party took issue with the 10% rule. We have this today with the leader of the Bloc Quebecois. I want to know why they are taking sides in a corporate debate. This government is not taking sides in a corporate debate.
We want the shareholders of public traded companies in the private sector to determine what is in their best economic interest, and then the government and parliament will determine if that agreement is in the public interest.
We will look at service to small communities. We will look at pricing. We will look at competition. We will look at Canadian control. We will look at how it affects the rights of workers, but I can assure the House that the government will protect the public interest so that all Canadians have an enviable travel system with strong air competition as we go into the 21st century.
Airline Industry October 27th, 1999
Mr. Speaker, to compare Australia and Canada with respect to air policy is indeed wrong. The population of Australia is smaller. It is somewhat isolated in the Pacific Ocean. Australia does not live next door to the largest economy in the world with a population 10 times greater than the population of Canada.
It is essential that we keep control of our own affairs. Keeping the 25% limit is one way to do that.