Alex Shepherd

[Canada Small Business Financing Act, September 28th, 1998]

Mr. Speaker, I listened with great intent to the member for Edmonton—Strathcona.

I am very surprised the Reform Party has taken the position today to argue against the Small Business Loans Act, an act which has been in place for over 37 years. It has been very successful. I think the member earlier said if it has been around for 37 years, what is wrong with it? Something that has been around for 37 years is a testament to its success and the need for it within our economy.

The member seems to talk about a perfect world. Maybe on the Reform benches it is Christmas every day, I do not know, but the reality is that it is not a perfect world.

Institutions not only in Canada but worldwide and banks often are short term lenders. They lend basically on current assets. This program addresses the concern for longer term assets, fixed assets. We talked about capital leases earlier. This is money that actually goes over a longer period of time.

The member talks about a burden on the taxpayers of Canada but the reality is that these are also the employers. These are the people who get jobs from these very businesses. They are also the taxpayers. We have created jobs. We have created taxpayers by assisting these businesses.

The member seems to think the SBLA program is a subsidy. He talks about the program as if it is a subsidy. I can assure him that people applying for these loans face the same screening devices as for any other form of loans and they are rejected on the same basis.

The member talks about a 5.6% default rate, but he fails to acknowledge the fact that 94% of these loans are successful. I suggest to the member that in spite of what he wants to do in the regulatory environment of banks that without government support in this area of those 94% of successful loans, those successful jobs would never have been created.

I am very surprised that the member and his party would be opposed to the best interests of small and medium size businesses today. I would like him to comment on that.

[Year 2000, June 11th, 1998]

Mr. Speaker, my question is for the Minister of Finance. The millennium bug is threatening to bring havoc to our small and medium size business communities with the result of job losses.

What is the minister prepared to do to come to the assistance of our small and medium size businesses to ensure that they and the jobs they create will be there in the year 2000?

[National Speech And Hearing Awareness Month, May 13th, 1998]

Mr. Speaker, May is National Speech and Hearing Awareness Month.

Our government is committed to building a society where the 10% of Canadians who suffer from hearing impairment can reach their goals both personally and professionally.

I am a person who suffers from hearing loss. I have no hearing in my left ear and only 50% in my right. In spite of this disability I have been able to build a successful accounting practice.

As a member of this House I have been able to use the sound equipment here without much impediment. In fact it has sometimes been a great advantage to me to turn off my hearing aid which I might say often adds to the comprehensibility of this place rather than detracts from it. Of course this is the lighter side of what for many is a major impediment.

I can say that government through programs at HRDC has made funding available to allow for training and computerization of many job functions to allow people with hearing impairments to have full and productive lives.

I salute the 10% of Canadians who suffer from hearing loss.

[Nuclear Testing, May 12th, 1998]

Mr. Speaker, my question is for the Minister of Natural Resources.

Following India's alarming nuclear test yesterday many in the international community are pointing to Canada as a source of technology transfer. India entered into agreements with Canada regarding the peaceful use of these technologies.

What safeguards exist in these sales of nuclear technologies?

[Holidays Act, May 6th, 1998]

moved for leave to introduce Bill C-401, an act to amend the Holidays Act (Flag Day) and to make consequential amendments to other acts.

Mr. Speaker, it gives me great pleasure today to introduce a bill respecting Flag Day. As we know Flag Day is totally recognized in Canada as being February 15. The purpose of my bill is to take that one step further and make it a national holiday.

The United States, being one country to which we often compare ourselves, has many more national holidays than does Canada. I think it is very appropriate that we take time to recognize our great traditions.

The flag is on either side of you, Mr. Speaker. Thirty-three years ago was its birthday and I think it would be appropriate to enshrine Flag Day as a national holiday so all future generations would remember that.

(Motions deemed adopted, bill read the first time and printed)

[Science And Technology, April 28th, 1998]

Mr. Speaker, my question is for the Secretary of State for Science and Technology. As we speak, a rocket is being sent off from Canadian soil at Churchill, Manitoba, the first in almost a decade. This is a precursor to launching a polar orbiting satellite.

How will these activities enhance Canada's technological preparedness in the changing world of telecommunications?

[Nunavut Act, April 20th, 1998]

Madam Speaker, I rise in reference to a question I posed on April 1 to the Minister of Finance regarding his position on recommendations made by the Senate banking committee that the proposed CPP investment board be allowed to increase its foreign property rule from 20% to 30% over a five year period. This would allow the board to invest in foreign securities as opposed to domestic ones and would bring that component up to 30%.

My objection to this recommendation is twofold. First, much consideration has been given not to tie the hands of pension managers who need better investment vehicles to enhance the return on investments of pension funds. I would like to draw the attention of the House to the fact that the vast majority of mutual funds now operated by these same managers cannot even perform at the average of the growth in Canadian stock exchange prices.

In other words most managers underperform even in terms of the averages of a TSE 300 composite index. Their inability to achieve even average returns in Canada should give us a clue to allowing them to expand investments in volatile foreign markets with CPP beneficiaries' money.

This volatility would include foreign exchange fluctuations as well as the general uncertainties of unknown regulatory environments. We only have to think of southeast Asia to believe that is one of those markets.

Can it be demonstrated that the current 20% rule diminishes potential returns in Canada regardless of the limit? For instance, the United States has an unrestricted limit for pension funds, but historically and currently only 10% of these funds are invested in foreign investments.

I refer to Japan which similarly has an unresticted rule but only invests 19%. Australia, which allows its pension managers full discretion of total foreign investment, only invests 16%. In other words it would appear that the norm in the world is under the 20% rule in any case. Why the necessity of changing it? There seems quite frankly to be no empirical evidence for increasing the limit.

My second concern is what I call the cascade effect. If the foreign property rule is increased for the Canada pension plan investment board, it follows that it should also be increased by their pensions, not the least of which is registered retirement savings plans.

Investors are free in this country to invest in foreign assets. The question is do we want to provide an income tax subsidy to do so. Needless to say those who maximize their RRSP contribution limits and take full advantage of the existing foreign component are also the highest income earners. I suggest it is inappropriate to provide them with further tax deferrals with Canadian taxpayers money simply so they can make foreign investments. Quite frankly they are already free to do so with tax paid money.

The minister stated that he would study this with his provincial counterparts. I wonder if the minister could not be more definitive in saying that he opposes this move at this time.

[Nunavut Act, April 20th, 1998]

Madam Speaker, I was quite taken back by my fellow colleague and her vision of Nunavut. I was speaking to her earlier on a personal basis and I actually managed to get very close to her riding over the Easter holidays when I was in Churchill.

I know the hon. member has a great vision of Nunavut and of the people of that great part of our country.

I want her to know that even though I am member of parliament from Southern Ontario we strongly believe that this is very much part of our nation and our history.

I would like to know from her how she sees the future, for instance, of tourism in the north. I know there are a lot of questions about how that will affect the ecological balance of some of those communities. I know that it is very fragile in some areas.

I am just wondering how she would balance creating more wealth by attracting visitors into the community with their traditional ways of life, as well as protecting the environment.

[Canada Pension Plan Investment Board, April 1st, 1998]

Mr. Speaker, my question is for the Minister of Finance.

The Senate banking committee has just released a report on the Canada pension plan investment board. What are the minister's views on this and how does he intend to react?

[Budget Implementation Act, 1998, March 31st, 1998]

Mr. Speaker, it gives me great pleasure to enter the debate on Bill C-36.

I would like to discuss a specific aspect of the legislation which perhaps many members have not mentioned. It has to do with the authorization in the act to allow the Canada Development Investment Corporation to dispose and transfer its assets and liabilities including the Canada Hibernia Holding Corporation.

All Canadians have been interested in the Hibernia oilfields for many years. It was back in 1965 that the initial investigative work was done in the oilfields to see whether this would have a significant potential for some of our poorer provinces.

Some people may wonder why the member for Durham is talking today about the Hibernia oilfields. My wife's family has deep roots in the province of Newfoundland. This is also something which all Canadians want to share and rejoice in. I do not think people realize that if the government disposed of its financial interest in the Hibernia oilfields, currently it would be about $2.5 billion. We can imagine what a positive impact that would have in hopefully increasing a surplus in future years.

The Hibernia project represents a partnership of Canadians for Canadians. I was in Newfoundland a couple of years ago and I discussed a number of the financial aspects with legislators there. They were very concerned about some of the cutbacks in the CHST and how they were going to be able to maintain some of their basic services through the CHST and also through the equalization payments system.

During various periods in the history of Newfoundland a depopulation has occurred. That has been a benefit to ridings like mine. A great number of people from Newfoundland are now residing in parts of Ontario. They had to leave Newfoundland because there was no employment. Unemployment levels in Newfoundland are still unacceptable. With the economic activity that is going to be generated by Hibernia, unemployment levels are going to decline.

A substantial investment in capital has already occurred in the Hibernia oilfields. Most of this money has been spent in Canada. Capital expenditures of over $5 billion have already gone into this project and 55% to 60% of these capital expenditures were Canadian. Sixty-six per cent of all employment was Canadian. Today as we speak there are over 250 jobs on that rig. Of course that money goes back into the economy of Newfoundland.

They are currently projecting to increase the production up to 20,000 barrels a day. As the entire platform is developed they are talking about 135,000 barrels of oil a day. That is a significant and major oil discovery on our east coast. It is going to have a tremendous impact on the economy of Newfoundland.

That is good. We all benefit. The federal government taxes these people when they make profits. The province of Newfoundland will get royalties from this and it also will get the spin-off jobs. This is very positive for increasing the economy of Newfoundland.

I should mention the recent discovery at Voisey's Bay. This is a long term project. When it gets going, Newfoundland will also be able to reap some benefits in the mining sector. The mining and resource sector is anticipated in 1998 by the Conference Board of Canada to increase its revenues by over 80% in the province of Newfoundland. Unemployment rates will decline due to this to 17.9%, which is still unacceptably high but is significantly lower than it has been in the past.

In St. John's and other communities in Newfoundland there has already been a tremendous increase in residential construction. The Conference Board of Canada estimates that in 1998 the renewal of the housing sector will increase 14.8%.

Some foresighted government years ago which saw the need to put in that seed capital to get the Hibernia project going was very wise indeed. This is a great opportunity for the people of Newfoundland to acquire economic benefits and to build a truly indigenous economy for themselves.

A concern I have about this issue is from time to time I hear people especially in resource based economies challenge the equalization payments system. The equalization payments system is based on certain income levels that exist within a provincial jurisdiction and then it tries to equate them with the three wealthier provinces. Through that process there have been payments to provinces to help raise their standards so that we all have equality.

That is what is so great about this country. As Canadians we agree that we have to have basic standards, standards in health care, standards in social services, standards in unemployment insurance benefits, et cetera. That is what makes this a great country.

If people were to sit down and ask what it is that Canadians understand, it is that we have over the years created these sharing arrangements. The people of Ontario and the wealthier provinces like Alberta and British Columbia from time to time have realized the importance of sharing in this way.

I have heard people argue from time to time that the resources from a resource based economy should be excluded from the equalization formula. This means we would exclude the resource sector from the calculations. The equalization payments would be skewed to allow the provinces that are utilizing their resources not to have to include them in the calculations.

I do not have to tell anyone that the province of Alberta for years and years has been a net contributor to the equalization payments system and an economy very heavily dependent on the resource sector.

Those people were able to buy into the argument. It seems that the new provinces, those now coming on with a higher resource sector must do so as well.

I understand the arguments I have often heard members speak about. They say that Newfoundland's infrastructure has deteriorated over the years, that they need time to build it up. They do not think they should be penalized by seeing their equalization payments decline at the same time that this is occurring. They want to be given some breathing room, to be given a chance to catch up.

I understand the merits of that having been to Newfoundland and having understood that its infrastructure certainly is in need of significant capital injection. However the reality is that we must as a country all live with common standards. For that reason, I believe it would be unwise for us to pursue that.

Right now the province of Newfoundland receives equalization payments of somewhere around $1.4 billion. We should all be rejoicing, including the people of Newfoundland, and saying that those equalization payments are going to come down.

Maybe one day Newfoundland will be a net contributor to the equalization payments system. That is great. Once again it shows how Canadians care and that in good times and bad times we can live together.

I also want to touch on one aspect of this legislation which I think perhaps a lot of members have overlooked. It is the ability to allow the government at any time to dispose of Hibernia by orders in council without bringing further legislation to this House.

It is a very significant time. Clearly somebody is thinking of doing just that. As we talk, international oil prices are fluctuating. It is clear that the government is going to be prudent in selecting a timeframe in which to undertake this.

We should know that our investment in Hibernia is really twofold. We have a direct investment via the Canada Hibernia Holding Corporation. That is an 8.5% interest in the entire operations. Some of the bigger players are Mobil Oil, Chevron and Petro-Canada. Interestingly enough we still own 8.3% of Petro-Canada so indirectly Petro-Canada also has an interest in the Hibernia oilfields.

I just wanted to intervene at this time to talk about the equalization payments system, about how the rest of Canada, including the people of Durham, are very thankful that this has been a success for the people of Newfoundland. At the same time I want to give them a little reminder that we are all in this club together. We are all going to play by the same rules. When things get a little better for Newfoundland, it will also have to play by the same rules. I am sure most people of Newfoundland believe that.

In closing, I wish the people in Newfoundland well. I was very happy the other day to see the first tanker shipment of oil leave the Hibernia oilfields. It marks a new day for the people of Newfoundland.