Mr. Speaker, in reply to two questions I recently asked in this House about the new regulations increasing bonds to be posted by customs brokers, the Minister of National Revenue referred me to the Canadian Association of Customs Brokers which seemingly supported his approach in this matter.
First of all, let me say to the minister that the picture is somewhat different from what he told us then. On November 24, the association held a meeting where 883 members gave their opinion on the advisability of these new regulations. The results of the vote were 803 against the regulations, 74 in favour and 6 abstentions. Because larger brokerage firms have multiple vot-
ing rights, the final result was 135 against the regulations, 141 in favour and 7 abstentions.
A study conducted by Brian Hull and Associates, a well-known economist from Ottawa, for the coalition of small and medium size brokers, shows that the new regulations unduly favour the larger brokerage firms. If they were to be subjected to the same standards as smaller brokers, they would see their security bill jump $1 million in one case, and between $150,000 and $180,000 in other cases, while they now pay only $30,000 for a maximum security of $10 million.
We can see the advantage given to these larger brokerage firms by this new administrative policy. Does the minister know that small and medium size brokers, those who broker 20,000 imports or less per year create 2,500 direct jobs in Canada and that their disappearance by a stroke of his pen would have a dramatic effect?
Does the minister know that with these new standards only 19 brokers would remain in Canada thanks to the privilege he would be giving them by instituting a ceiling of $10 million for the security they must post.
Let me quote the conclusions of Mr. Hull's study.
The effect of this new ruling by Revenue Canada for account security and the disproportionate burden of its impact as between large and small firms is to place the Government of Canada in violation of the basic principles of conduct on which the Competition Act of Canada is founded.
The effect of the new formula is to, first, impede the efficiency and adaptability of the Canadian economy; second, restrict opportunities for Canadian competition in global markets, while discriminating on behalf of foreign competition; third, seriously impede the opportunity for small and medium sized enterprises to participate in the Canadian economy; and, fourth, to reduce the choice of competitive prices and services available to Canadians.
A $10 million security on a monthly invoice of $250 million is only 4 per cent, while a $1.8 million security for smaller brokers is 100 per cent of their monthly invoice.
Does the minister, who is trying so hard to protect importers, realize that large brokerage firms are just as likely as small ones to go bankrupt? I would even go so far as to say that large diversified companies, with interests in transportation, storage, handling, run a higher risk. Take real estate development, for example, Campeau Corporation, the Reichman brothers and others went under before all the smaller companies disappeared. In the insurance business, did some large companies not go bankrupt before many small ones?
If the minister is really committed to protecting the public, here is my suggestion: First, he should go back to the formula where everyone had ten days to pay duties and taxes, the way it is in the United States and the way it was in Canada before these interim payments, which are at the root of all our problems, were instituted. He should keep security at 100 per cent of monthly billings and make all brokers, large and small, equally responsible.