Alex Shepherd

[Program Cost Declaration Act, June 7th, 1995]

moved for leave to introduce Bill C-332, an act to provide for improved information on the cost of proposed government programs.

Mr. Speaker, this bill, an act to provide for improved information on the cost of proposed government programs, is something that is long overdue in this place.

Basically the bill would provide that any new programs introduced into the House are properly costed beforehand. That costing and the methodologies used therein would be supported by the auditor general. In other words, the auditor general would actually review the costing methods used and certify them as being appropriate. That legislation, wherever it is advertised and promoted, would also include certification by the auditor general and also the actual cost, not only of the total program but also on a per capita basis for all the taxpayers of Canada.

I believe this would give us more control over our financial picture and would certainly give better information to the public on how much these programs cost.

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

[Petitions, June 5th, 1995]

Mr. Speaker, I am happy to present a petition from 51 of my constituents who request that Parliament not amend the human rights code, the Canadian Human Rights Act or the charter of rights and freedoms in any way which would tend to indicate societal approval of same sex relationships or homosexuality, including amending the human rights code to include in the prohibited grounds for discrimination the undefined phrase of sexual orientation.

[Farm Improvement And Marketing Co-Operative Loans Act, June 2nd, 1995]

Mr. Speaker, I thank the hon. member for his question.

My experience with the farm community is they can use as much help as they can get. Farmers often tell us that they are not getting enough access to capital and they wish the government would do more.

It seems incredible to me that the member for Frontenac would try to minimize the amount of access that the farm community in Quebec has to the financial institutions in that province.

Farmers can never have enough. The more people who are active in the business of financing farms the better. Certainly the federal government has shown for as long as I can remember its commitment to farming from sea to sea. I do not believe that the farmers of Quebec would want to lose that benefit.

The second point that the hon. member made was the concept that people cannot be represented here because of one language or another. I do not apologize but I am unilingual English. I have attempted to learn French from time to time but I have not been very successful. I guess I am not a good scholar in languages.

The Minister of Agriculture and Agri-Food represents all the farmers of Canada and has done so ever since I have been here. He has been to the GATT and NAFTA negotiations. I know he negotiates in the best interest of Canada from sea to sea to sea, which includes those interests which affect the farmers of Quebec.

I am very honoured that the minister of agriculture represents the agricultural community as well as he does. He has a very balanced approach. He very much tries to balance the interests of the agricultural sector in Quebec within the country as he does with all provinces. I have heard him on numerous times talking about a balanced approach, that we do not trade off one sector of commodities against another. That is nothing but good for Quebec and Canada and the operations of stable agricultural markets within our country.

I must confess I do not know the name of the agriculture minister in Quebec. I do not know the one in Ontario either. The one I do know is the federal minister of agriculture who represents us so well.

(Motion agreed to, bill read the third time and passed.)

[Farm Improvement And Marketing Co-Operative Loans Act, June 2nd, 1995]

Mr. Speaker, miracles never seem to happen to me in this House. I listened to the Reform Party go on and on, its members first stating they support the bill. They then spent almost all of their time saying why it was not such a good idea. I am a little confused by that approach. It seems they are saying government should not assist farmers.

Almost one in five workers in the Durham area are farmers with 3,500 families who either directly or indirectly owe their living to agriculture. The people of Durham very much appreciate the federal government's commitment to assist them in the capitalization of their farming operations.

Sometimes there is a lot of confusion in the House about what farmers do and the types of operations they run. Many members have talked about how other forms of capital are available to farmers, that lending institutions could take up the slack. That is not true. The Farm Credit Corporation and this program came into existence because the government recognized that problems within our capital markets prevent access to capital by not only small businesses but farmers in particular.

Farming is a capital intensive business. I could probably equate it with a utilities company. Everything done in farming involves substantial capital: equipment, the farm property, barns. Utilities are probably the closest example of similar operations that require capital over long periods of time.

Our lending institutions are often only interested in short term loans, which creates a disequilibrium in the capital markets. That is why this is an area government should be involved in. I know many of my farm constituents are very happy the federal government is part of this process.

I would like to speak about some of the specific aspects of Bill C-75. Some members have expressed concern over questions of overlap and duplication with the provinces. Only two provinces have similar programs, Quebec and Alberta. These are the two provinces where activity under FIMCLA has shown its greatest growth. The arguments about duplication being bad come from the very provinces that have utilized this system the most.

I heard some of my colleagues in the Bloc talking about how it was a failure. Interestingly enough, loan applications in Quebec went from 142 in 1990-91 to 1,700 in 1994-95. This is a success, hardly a failure. That growth has been largely a result of caisse populaire Desjardins' movement to become a lender under the program. In Alberta, the provincial government's treasury branches now offer FIMCLA loans and concentrate its resources in other areas. The concept of duplication is not real in this case.

Within the federal government we have to consider the different roles FIMCLA, Farm Credit Corporation and the Small Businesses Loans Act play. Of these FIMCLA is the only national loan program that can be accessed by farmers and farmer-owner marketing co-ops because FIMCLA loans are available from the six major banks. There are banks in almost all of our communities but there is not an FCC office in all communities. Similarly, the Small Businesses Loans Act is really oriented toward small business operations as opposed to farmers although farmers can also access this program.

Every rural centre has a bank or credit union but not all have FCC offices. In addition, the Farm Credit Corporation does not guarantee loans made by competing commercial lenders. Those lenders would not likely welcome audits by the FCC as is required under FIMCLA. So there is really no way FIMCLA could be offered by the FCC.

It has also been suggested that FIMCLA should be amalgamated with the Small Businesses Loans Act. The problem with this idea is that the FIMCLA loss ratio is significantly less than the SBLA program. Most FIMCLA loans are made to establish farm operations because assets taken as security for FIMCLA loans generally have a higher disposable value.

This gets back to what I was originally saying. Farms are highly capitalized, therefore they also have capital to put up for credit purposes more so than to some smaller type businesses. As a consequence there are fewer loan loss provisions. It would be unfair to charge farmers higher interest rates and registration fees to subsidize small business loan losses.

In addition, most commercial lenders have segregated their commercial lending and agricultural lending divisions. Government loan guarantee programs currently mirror this structure.

FIMCLA gives farmers a better interest rate than they could normally get and allows them borrowing credit with only 20 per cent equity. In other words, they have the ability to get up to 80 per cent financing on their assets.

Finally, there has been some confusion about the meaning of the loan cap. The legislation provides that the total amount of the loans registered over a rolling five-year period will not exceed $1.5 billion. This legislation is really quite simple in that it doubles the cap, increasing the total cap to $3 billion within the program.

The parliamentary secretary was saying earlier that we were quickly approaching that cap. If we do not pass this legislation shortly we will have to curtail the program. I can assure members that as the spring work continues on the farms that some farmers would be unduly penalized if for some reason this legislation did not continue.

I repeat, this is the total amount of loans registered over the five-year period. It is not the total amount of loans outstanding because at any one time repayments have already been made on the loans registered in the first four years of the period.

In other words, it is a total loan application. Loans come and go. The total exposure of the government is substantially less than even $1.5 billion today or $3 billion in the future as we increase the cap.

The government's liability on the program is for defaults. Historically these have been very low, around 1 to 1.5 per cent. I can assure members that this is a very significant loan loss provision. It tells members a lot about our farm communities. It tells you that these people pay their bills. In spite of the fact that they are highly capitalized, and they do have a high debt structure, once again it is because of their type of operations.

I know this quite well because I actually farmed at one time. I can tell members that every time there was an extra dollar on the farm, it seemed to go back into some form of equipment. This is why farmers are highly exposed when borrowing.

I understand that all the parties I have heard of today are still in support of this legislation. I encourage members to pass it forthwith.

[Petitions, June 2nd, 1995]

Mr. Speaker, I have a petition from 42 of my constituents. Basically they are concerned about access to children by grandparents.

The petitioners ask that the Divorce Act be amended in such a way that in no case may a father or mother without serious cause place obstacles between the child and grandparents. It goes on to talk about giving them access to the child, the right to make inquiries and to be given information as to the health, education, and welfare of the child.

[Supply, June 1st, 1995]

Madam Speaker, it gives me great pleasure to enter into this debate on the motion by my hon. colleague in the Bloc Quebecois.

What we are discussing today is flexible federalism. Indeed, I think sometimes that my hon. colleagues in the Bloc do not understand the word flexible. What has kept Canada together for many years has been the fact that people have been able to understand and respect each other's differences and diversities.

I can remember reading an article about an American study which was commissioned during the second world war. It said that of all the allied countries which were fighting in the war, Canada was the most likely to break up.

As we stand here today we can reflect on the erroneousness of that report which talked about Canada's being so decentralized it would be an easy matter for it to dissolve. The reality is the decentralization of Canada is its strength.

We govern a huge geographical country. This part of the northern hemisphere has not only great cultural diversity but also climactic diversity due to our geography. Lester Pearson once said we have too much geography in this country. There is some truth to that.

My fellow colleagues in the Bloc often discuss and point to what they believe is duplication and overlap. They like to point out this is some kind of failure of our federal system. Let us look at some of these programs. I am amazed at some of the areas Quebec does control. It has control over immigration and controls for a large part its own income tax system. For most countries their individual states do not have these kinds of powers. Clearly we have already decentralized significantly in Canada.

The Bloc often says our having shared jurisdictions creates inefficiency. Duplication and overlap is the theory. I have been interested to discover one area of purely provincial jurisdiction in Quebec, education, does not perform particularly well. Next to Alberta, Quebec has the highest drop out rate for secondary education institutions, over 30 per cent.

Quebec spends the highest per capita on education with $7,132 per student. With this exclusive control it would appear it has been unable to solve its problems. All provinces have problems, but it is not clear that by not having shared jurisdictions somehow there are great efficiencies to be earned. With shared jurisdictions there is more of a consultative framework, more of an opportunity to get good advice form across the country.

I will deal with two components of the motion. It talks about Bill C-88, an agreement on internal trade. All provinces have basically consented to this and signed this agreement. In an era when we are discussing things like the GATT agreement and NAFTA it seems almost a tarnish and a shame on Canada that we have to argue and discuss trade agreements within our country.

The Bloc Quebecois has often talked about a European Union type of government. In reality the European Union probably has freer trade within its union than does Canada. The agreement on internal trade does not solve all of these problems. There is continued inhibition of trade within our country. It seems odd to me when this act is used as part of an argument that somehow we are trying to concentrate power in Ottawa when in reality we are trying to create a free market within our nation.

The motion deals with Bill C-91, an act not to create something new but merely to rename something. I can only assume my colleague's concern is the Federal Business Development Bank may well become the business development bank of Canada. I do not know if the use of the word Canada bothers him so much. I do not like those words. When I see the words of Canada I think of American corporations operating in Canada, such as General Motors of Canada. Be that as it may this is the proposed new name.

It seems to me some of the things proposed in the legislation are to create more dynamism in arranging capitalization of small and medium sized businesses. This is something very close to my heart. I believe through creating new capital markets in Canada we will encourage and create new jobs. The business formation is inhibited by its inability to seek capital.

I have listened to some of my colleagues in the Reform Party who speak against this bill because they feel it is a competition with existing banking structures. The Federal Business Development Bank and in some ways its sister company, the Farm Credit Corporation came into existence for a very significant and real reason: there is a significant lack of long term business financing. Our banking sector has basically become a short term lender. The popular loan within the banks is a demand loan. Imagine borrowing some money today and tomorrow the banks can call it back. That is how the banks want to lend. There are a number of reasons. It has to do with their deposits and so on. That is what banks are.

In a sense there is a disequilibrium in the market which is long term financing. Banks do not get involved in it mainly because of the way they are capitalized. The Federal Business Development Bank, which is now called the business development bank of Canada, will raise funds in Europe and other equity markets throughout the world and attempt to match them on a long term approach.

It does not matter whether we are in Quebec, Ontario or Saskatchewan, small business needs some kind of access to this capitalization and it is not being provided in Canada.

In the United States it is common to have mortgages that run 30 years and payable in 30 years. This gives people a great deal of security in their arrangements. We do not have this in Canada. Our capital markets are deficient because we have only short term lenders. Because of that uncertainty in our marketplace

small businesses find it very difficult to become capitalized. What they want is equipment. Farmers are probably the most capital intensive of any business with farmland, equipment and buildings that cannot be paid off tomorrow.

I am surprised that my colleagues in the Bloc, who I am sure must be interested in creating jobs in Quebec which has one of the highest unemployment rates in Canada, would see this bill as somehow a centralizing factor. This bank has branches throughout Quebec. If we had only one branch in Ottawa and we made all the people come here, I would call that centralization. When in reality facilities are available not only in Quebec but throughout Canada that is a decentralized approach and we are not treating any one province differently than another.

These are not gifts. These are not grants. These are not sources of regional development. People simply borrow money on a long term basis and pay it back over an agreed period of time. It is fulfilling a need.

I understand some people wish the private sector would do this. Why Canada is typified by short term capital markets I do not know. However, this is the way it is being addressed. Hopefully some day we can privatize this bank, but it has not occurred. Most of the major banks still do not get involved in long term lending.

From my experience the Federal Business Development Bank has been a major asset in lending to small businesses.

The important thing is both of these pieces of legislation have nothing to do with centralizing the power of the state but they have everything to do with creating jobs in neighbourhoods and communities in Quebec and in Ontario.

The problem we have with a lot of people is we have too much government. I do not think we need to centralize it. We need to get government closer to the people.

[Canadian Dairy Commission Act, May 17th, 1995]

Mr. Speaker, I listened with interest to the hon. member.

He talked about competition. He envied the American agricultural system and its milk producers. In Canada milk producers are better compensated than their American counterparts.

Even so, the top 10 per cent of dairy producers only receive about 5 per cent return on their invested capital. Clearly from a business operation Canadian farmers are far from being wealthy. The hon. member is speaking about emulating a system that will make Canadian farmers far poorer than that.

It is interesting that we have had both the Bloc and Reform members on their feet today speaking about the same system. They are talking about decentralizing, weakening the federal system.

The NAFTA and the GATT have already weakened the federal government's ability to exercise economic policy within our borders. By decentralizing even further and allocating more powers to the provinces there is a point at which there would be nothing left. That is what both of these parties basically want to do. I am very happy to belong to the governing party which understands the need for national standards and national policy.

We are debating a pooling agreement which draws to our attention the importance of a federal system with provinces and the federal government setting national standards, in this case for the pooling of milk.

It has the possibility of being downloaded to the provinces by certain authorities. At the same time it is establishing national standards. I believe some of my colleagues in the Reform Party would do the reverse. They would have each province make its own agricultural policy as it affected them.

I would like the hon. member to address whether they are in favour of a supply managed system Canada or an American free market system with lower incomes to farmers than in the Canadian system.

[Canadian Dairy Commission Act, May 17th, 1995]

Mr. Speaker, I listened with great interest to the hon. member for Québec-Est. He often performs eloquently on agricultural issues. However he speaks of a fairy world in which we can have our cake and eat it too.

The member talked about the fear of the American market system and protecting his own people, the farmers of Quebec, from the American marketing system. The uniqueness of that is that America is a nation state. We are not talking about Canada being a group of 10 nation states; we are talking about Canada being a federalist state. Perhaps the member has not studied economic history, but sovereign states basically take care of their own people first. The concept is the welfare of the people who live within that country.

The GATT negotiation is a way of playing baseball. We are to play a game and these are the rules. Each team is trying to win. Each team is trying to be effective. It is an illusion to have a pooling system, keep all the good things and have a sovereign state. To argue that we are going to keep the good and do away with the bad is not how it works in reality. It has not worked in any country. Sovereign nations will take care of their own people first.

Farmers in Quebec are the highest per capita income earners of all farmers in Canada. How could the member argue that they have been taken advantage of or that they are at a great disadvantage in the federal system when they are the best off economically of all farmers in the country?

[Canadian Dairy Commission Act, May 17th, 1995]

Mr. Speaker, I would like to congratulate the member for Matapédia-Matane for his dissertation on this bill.

As I listened to the member's speech I was taken aback by how he used a federal agreement to argue the case of an independent Quebec. Actually, as I read this piece of legislation it occurred to me that this is one of the powerful things of a federal state like Canada, which can actually come to national agreements in the best interests of all the people of Canada, including the farmers of Quebec.

The signatories in this agreement are not other independent countries. They are not states of the United States. In fact they are people who have agreed to make this arrangement within a federal state. Indeed, if my memory serves me correctly the whole concept of pooling and marketing board systems was created by the federal government in the first place.

Most of the farmers in Canada recognize the importance of the federal government in the area of marketing and in establishing national marketing standards. My riding is also a very important area of milk production, contributing 2 per cent of the total milk production for the province of Ontario. I can tell the hon. member that if things were different, if things were as he would like them to be, the people in my riding would do the economic thing and start producing more milk to service our own domestic market, excluding the people of Quebec.

Forty per cent of the industrial milk quota has been allocated to the province of Quebec. I want to assure the member that the people in his riding are very much taking advantage of the federalist system. I would like to bring that to the member's attention.

[Port Perry Cadet Corps, May 15th, 1995]

Mr. Speaker, we are being visited today by the Port Perry Cadet Corps. This corps of young men, who attend both elementary and secondary school, has a long history of achievements.

Having been formed in 1898, they are now fast approaching their 100th anniversary. The purpose is not to train soldiers but to train young men for the responsibilities of citizenship.

Being a part of the Department of National Defence, they have expressed to me their concerns about possible reduced funding, especially since they are often dependent on the local forces base, many of which are now closing. They also expressed to me the need to get funding down to the level of local decision makers. Highly centralized authority often makes inappropriate decisions with respect to local needs.

I would like to thank Major Doodley and the 40 young men of the Port Perry Cadet Corps who have made such a major contribution to our community.