Pierre De Savoye

[Bell Canada Act, October 29th, 1996]

Mr. Speaker, I listened carefully to my hon. colleague's remarks on this important issue and I would like to get his view on the fact that, at present, technological advances-and we are all for technology and we believe in it-are not accessible and apparently cannot be made equally accessible to all consumers.

Precisely because large urban centres are profitable for telephone companies, that is where the competition is and, naturally, urban consumers will have access to excellent services at a presumably reasonable price. But in rural areas, Bell Canada remains the only provider. The competition does not reach there; it would cost them too much.

Bell Canada, which used to be able to derive part of its revenue from urban centres to make up for the higher cost of providing service to rural areas, can no longer do that and, as a result, people living in rural areas will not enjoy the same grade of service or good prices as their urban counterparts.

Does my hon. colleague not think that our friends from the Reform Party should take up the position of the Bloc Quebecois to ensure that technological advances and deregulation benefit all citizens and demand that the Minister of Industry take steps to ensure we achieve this desirable end.

[Bell Canada Act, October 29th, 1996]

Madam Speaker, I listened carefully to the speech of my colleague, both on the monitors and here in the House. I must say that affordability and accessibility of services are not empty questions.

There is a real possibility we will end up with a two tier society if we do nothing to prevent it. There will be those who can afford the services and those who cannot. There will be those who will know how to use the tools and those who will not. If we are not careful about this, we could create information ghettos which would be hard to escape.

I am surprised that my colleague across the way is singing the praises of technology. I have been working with information systems since 1968, for 28 years now, and I understand quite well, probably better than anybody in this House, what is at stake in this situation. As I have experienced how difficult it is for companies and individuals to adapt to technological changes, I must caution the Liberal government not to make such changes unless it is very sensitive to the needs of society as a whole and most of all to the needs of the neediest in our society.

This is not an insignificant issue, it is the fundamental purpose of a society to go forward, but we must do so all together as we want to do in Quebec and as we want to do in Canada, I hope.

[Bell Canada Act, October 29th, 1996]

Mr. Speaker, I listened with great interest to the speech by my colleague from the Liberal Party. He announced all those great things the public will soon benefit from.

I would like to ask him a question. Since the unemployment level is close to 23, 24 and even 25 per cent, since the unemployed have trouble making ends meet, since the monthly telephone bill increases by $2 each year and another $1.11 will soon be added to that, how does he think that these people, one in four in Canada now, will be able to afford the range of services he just described? As a government, is the Liberal Party not creating a two tier society, one for those who have money and one for those who will have to do without services whenever there is not enough money? I would like an answer to that question.

[Bell Canada Act, October 29th, 1996]

Mr. Speaker, Bill C-57 contains only one clause. The bill's purpose is quite simple: it repeals section 7 of the Bell Canada Act, which currently prohibits Bell Canada and any person controlled by Bell Canada from directly or indirectly holding a broadcasting licence or operating a broadcasting undertaking.

In tabling this bill, the Minister of Industry is following up on a recommendation made by the CRTC in its document on the information highway entitled Competition and Culture on Canada's Information Highway: Managing the Realities of Transition . In this document, made public on May 19, 1995, the CRTC wrote, on page 25, and I quote:

Bell Canada is currently prohibited from holding a broadcasting licence pursuant to the Bell Canada Act. Given the Commission's view that Canadian telephone companies have the potential to contribute to the objectives of the Broadcasting Act, and that they should be allowed to do so, the Commission recommends that the Government amend the Bell Canada Act to permit Bell Canada to hold broadcasting licences.

Last August 6, when the Minister of Industry made public his policy on convergence, he announced that this bill would soon be tabled.

As you can see, it fits into the broad and immediate context of the advent of the information highway, and more particularly of the convergence of telephone, telecommunications and broadcasting technologies.

As you know, advances in these technologies now mean that they are converging and must, to all intents and purposes, be able to merge one with the other. Thus, telephone companies and cable distributors, to take one example, will shortly be offering the same services. It is because of this context that the bill is necessary, so that Bell Canada can eventually transmit television signals, since cable distributors, for their part, will be authorized to provide telephone services.

Bell and its partners at Stentor will be able to provide broadcasting services, as soon as the government has regulated competition with respect to local telephone services, including rates, so that cable distributors and other companies will be able to set up competitive local telephone services.

This convergence of technologies prompted the Minister of Industry to state in a press release this past September 19, and I quote: "The real winners are consumers, who will ultimately have a choice in who provides their services." An interesting statement, is it not? Will the public see its quality of life improved as a result?

The advent of the information highway will profoundly affect the lives of individuals in the first part of the next century. Business, information, recreation, entertainment, work, culture, consumerism, will all be linked to information highway technologies.

This is the reason why, although the bill submitted by the government is not really complex, and might be a mere technicality in itself, the Bloc Quebecois feels that it cannot be examined except in conjunction with the entire aspect of the information highway.

When the Minister of Industry states at the drop of a hat that his approach, based on competition at all cost, will ensure individuals and society of quality of life, we believe the minister is being naive at best, and committing a very dangerous error at worst.

Have the federal government's promises about protecting the interests of Quebecers and Canadians in implementing the information highway been kept, or will they be kept? That is the question. In the next few minutes, I shall direct the attention of this House to the pitfalls that are already a threat to us as individuals and as a society, and those that will be a threat in the short and medium term.

The deregulation process in the telecommunications field has been underway for more than ten years, but the key decision dates back to 1992, when the CRTC introduced long distance competi-

tion. This marked the end of a long tradition in the telecommunications industry which has always been a monopoly. According to the Minister of Industry, the decision should benefit all consumers. But does it really?

As shown in the report on long distance savings by the coalition for affordable telephone services, filed in February 1996, most residential subscribers of companies that are members of Stentor had enjoyed no substantial reduction in their long distance bills since the CRTC opened up the area to competition in 1992.

As you know, the coalition is an umbrella organization for more than 60 associations across Canada. It includes organizations that represent consumers, senior citizens, unions and other public interest groups. It is probably the largest coalition of consumers nationwide.

I would like to quote to the House what it says on page 2 of the coalition's report, which reads as follows:

"Last December, the members of the Stentor group convinced the federal government that they should be allowed to keep the increases-we are talking about increases in residential rates-and not have to reduce basic rates. If residential subscribers remain customers of Stentor for long distance services, they will pay not less than $700 million in 1996 and 1997, and over a ten year period up to $4.5 billion, an amount that would go to the telephone companies without giving the subscriber the benefit of discounts on long distance calls they pay for, discounts to which they are entitled".

The coalition goes on to say that long distance rates have gone down, but significantly so only in the case of wholesale users, mainly large corporations.

In ruling 94-19 and 94-21, the CRTC announced that it would, among other things, authorize a re-balancing of rates between long distance and local services and would therefore allow three increases of $2 each in the monthly basic service rate over the next three years, each increase being $2.

In exchange, the telecommunications companies would commit themselves to reducing the long distance bills of residential subscribers and small and medium-size businesses by the same amount. However, Bell Canada and seven other telecommunications companies that are members of the Stentor group objected to this restriction and filed a petition with the government asking that the restriction be withdrawn.

Forgetting his promises to consumers, the Minister of Industry approved this application by the Stentor group by maintaining the increase in local service rates-$2 in 1996, $2 in 1997 and a review of the $2 increase in 1998-while allowing market competition to continue to dictate long distance charges.

Worse, as consumers were hit by an increase in local service rates without a reduction in long distance rates, the president of Bell Canada was quoted in the December 21, 1995 edition of Le Devoir as saying that the government's decision would result in a 1 per cent increase in the rate of return of stockholders' equity for the year 1996.

For its part, the Fédération nationale des associations de consommateurs du Québec or FNACQ stated in the same article that, in the next three years, Canadian households would have to pay over $1 billion more for local service so that telephone companies can make as much profit as they want.

An FNACQ analyst, Marie Vallée, added that the CRTC's original decision would have translated into a first substantial reduction for residential low and medium volume users of long distance and for small businesses. Unfortunately, this did not materialize.

There was some hope that consumers would now have some breathing room. Unfortunately, on September 6, Bell Canada submitted a new application regarding residential service to the CRTC. This application has two components. The first component is the modernization of the telephone network for some 490,000 customers in Quebec and Ontario by the end of 1997. That is good news. But there is a hitch. The second component is the proposed compaction of the rate scale from 19 to 11 levels, which would lead to an average increase of $1.11 for 850,000 Quebec households. How will the CRTC rule on this new application for a rate hike? I am afraid to guess.

But that is not all. Let us talk about business customers. Last spring, Bell Canada tabled with the CRTC a proposal to harmonize the rates paid by business customers in small, rural communities. As you may have figured out, we are moving toward a new rate increase. In fact, according to Bell, business customers in small, rural communities will have to pay between $44 and $54 for their lines, compared to between $39 and $44 in major centres. Should this increase be approved by the CRTC, it would take effect in July 1997.

Let us think about this for a minute. When a business wants to modernize its equipment or develop new services, it usually has three ways to raise capital: reinvesting operating profits in its modernization, issuing additional shares or borrowing the money from the banks.

Telephone companies have a better system. Because they operate a monopoly, they can increase their rates as they please, with the government's blessing, thereby increasing their profits.

This means that, at present, those paying for the information highway structure, infrastructure and superstructure are mainly the people taken hostage by the telephone companies. Yet this infrastructure will be the property of private companies. I find that indecent.

The effects are both negative and unacceptable to any modern society. First, basic service will no longer be affordable for low-income individuals and families. In a world where communications and information are becoming the cornerstone of societal relations, those who are excluded will be dramatically marginalized. Is that the kind of society the Minister of Industry has in mind? I hope not.

Another negative effect: higher commercial rates will affect rural businesses than others. As we know, access to communications services has become essential to any business. If these services are reduced in any way, or cost more outside urban centres, the message the Minister of Industry will be sending our local businesses is that they should move to larger urban centres. Of course, this would make no sense.

The Minister of Industry must realize that deregulating left and right as he is currently doing produces ill effects. It is true that it costs Bell Canada more to provide services in rural regions than in urban regions. That is true.

It is therefore only normal that the more lucrative urban market is more attractive to new competitors. The resulting loss of income from urban sources forces Bell Canada to charge amounts closer to its actual costs, which, in turn, penalizes the regions. Give the rules put in place by the Minister of Industry, the telephone companies' reaction is both normal and predictable. But it is also unacceptable, totally unacceptable.

The minister certainly cannot believe nor say that consumers and our businesses will benefit from this competition. The facts prove just the opposite. Instead of using their own money to invest in modernization, communication companies pass most of the cost on to the consumers. Worse yet, the poorest consumers and those living outside large urban centres are the hardest hit. The Minister of Industry can no longer afford not to be involved.

Are there solutions? Let me draw the attention of this House to the solutions proposed by the Fédération nationale des associations de consommateurs du Québec, or FNACQ, the National Anti-Poverty Organization, and the Canadian Seniors Network. These groups propose, based on measures successfully implemented in California, to first set a monthly rate ceiling of $15 for the basic service provided to households that have confirmed, through a self-certification process, that their income is below the poverty line.

The shortfall suffered by telephone companies affected would be compensated with moneys from a universal telecommunications access fund. These moneys would come from a supplement charged to the ultimate user of telecommunications services. The providers of telecommunications services would be responsible for collecting these moneys and transferring them to the fund. In return, the fund would compensate the companies providing the service to the poor.

In the case of businesses located in the regions, the purpose of the fund would be to ensure a sharing of access and maintenance costs, which are, of course, higher in the regions than in urban areas. The fund would be financed through a contribution paid by the companies providing the telecommunications services.

The proposals of these organizations were made following CRTC's public notice 95-49, which sought to develop the means to ensure that telecommunications services continue to be universally accessible at affordable rates. CRTC's decision in this regard should be known in the next few days. Let us hope it is the right one.

Public notice 95-49, tabled by the CRTC on November 22, 1995, that is before the government's rejection of rulings 94-19 and 95-21, states, among other things, that the CRTC feels local rate increases, over and above the ones that would result from the rate rebalancing referred to in ruling 95-21, raise concerns about the maintaining and affordability of local services. This should convince the industry minister to rethink his all-around competition policy.

The concerns of the Bloc Quebecois regarding consumers' interests are not limited to wire telecommunications. We are also worried about the consequences, for the public, of implementing new wireless infrastructures, such as personal telecommunications services, multimedia services via satellites, direct broadcast satellites, and broadcasters digitizing.

In fact, beyond the financial consequences for the consumer, the Minister of Industry has not yet told us where he stands with respect to the protection of personal information, copyright and privacy, or with respect to offensive content, child pornography, production of francophone content, affordability, accessibility and universality of these services.

We must look at this bill in the larger context of the information highway. The federal strategy with respect to the information highway is unfortunately being doled out bit by bit by the Minister of Industry, despite extensive, in-depth studies by various organizations. Thus, despite the CRTC report on competition and culture on Canada's information highway tabled a good year and a half ago, despite the final report by the information highway advisory council tabled over a year ago, despite the many departmental committees on which numerous public servants toil away and, finally, despite the Minister of Industry's constant reminders of the need for urgent action, the minister has still only intervened in the infrastructure sectors. By intervene, all we really mean is leaving the field wide open for private enterprise.

I would also point out that the information highway is not really being looked at by any standing committee of the House, although it is an issue of paramount importance for the future of Canada and of Quebec.

I will, if I may, give you an example of how pitifully little has been done. There is the document published by the Minister of Industry last May 23 entitled: Moving Canada into the 21st Century . Everyone was expecting the government to come up with an action plan for the information highway. But all we got was a progress report on implementation of the information highway. The Bloc Quebecois reacted vigorously when this so-called strategy was tabled.

The minister's report made no mention at all of important factors linked to the development of the information highway. Although the minister wants to encourage virtual transactions with the public, he does not say how he will ensure that everyone, every single citizen in this country, will have affordable access to the information highway.

Furthermore, although electronic marketing will create a new economy that under existing rules may be able to evade taxes and even threaten the rights of consumers, the minister makes no mention at all of this issue. Copyright, offensive content and foreign transactions are given very superficial treatment.

In fact, the minister mentions only those problems we already know, without suggesting innovative solutions. Even worse, the minister's document as well ignored Quebec culture, lumping it together with Canadian multicultural culture. Furthermore, the document indicates a willingness to intrude on provincial jurisdictions.

Finally, the Minister of Industry informs us in this report that the policy on convergence would be tabled later. It was released on August 6 by the ministers of industry and Canadian heritage. I may point out that once again, the announcement was made during the parliamentary recess, so that the government would not have to face the usual barrage of questions and criticism.

In a press release, the Bloc Quebecois expressed its reservations about the government's policy statement. So the ministers of Canadian heritage and industry seem to have forgotten that the big players in the telecommunications and cable industries will look after their own interests first, and that the law of the jungle will prevail. The policy statement on convergence has created a climate of complete uncertainty as to the future of telecommunications and broadcasting services in this context.

The bill now before the House comes as a result of this policy statement. Let us see what it says.

First of all, by allowing telephone and cable companies to provide the full range of communications and broadcasting services, the policy statement on convergence makes vertical integration of services inevitable.

Consequently, despite the ministers' guarantees to the contrary, it is obvious that all of the companies involved will see joint financing as an interesting way to ensure a competitive edge. With number crunching, they will find it easier than ever to ensure that no legal stone is left unturned. Major clients will be attracted by price reductions, which will be inaccessible to the general consumer, who will still unfortunately be a prisoner of his monthly bill. This is what the Bloc Quebecois predicted last August, and now we see it happening.

In this battle between the giants of industry, they will no doubt be able to guarantee their risks and their profits, by joining forces through the creation of new structurally distinct companies in which they will be co-shareholders. Already several American companies have joined forces with Canadian ones and have a strong presence in both regular and cell phone service.

Under the guise of healthy and durable competition, the government is moving convergence into the jungle of world competition, where there have already been many, far too many, victims.

You will understand that I regret the federal Minister of Industry's decision to allow market forces to dictate the physical and technical implementation of the information highway. And yet, consumers finance most of it through significant hikes in their monthly bills. I also deplore the fact that the minister is neglecting one of the main stakes in the information highway, namely content development and distribution, whether in the areas of entertainment, professional services or teleshopping.

And yet, it is a consumer market worth tens of billions of dollars. What positions will Canadians and Quebecers take in this market? The answer to this question lies to a large extent in the way issues regarding copyright, tax legislation enforcement, consumer protection, security, privacy, the respect of cultural, moral or civil values will be dealt with at the national and international levels. Unfortunately, these unavoidable issues are being ignored by the industry minister.

And what about the accessibility issue, the danger of a two tier society, one made up of those who are connected and those who are not; those who know how to use it and those who are unable to. I believe that the minister should without delay allow the House to have an input in the analysis and resolution of the critical stakes in the information revolution.

You will agree that this information revolution is going to completely reshape, for better or for worse, social, cultural and economic relationships within society for the next century. So far, the Bloc Quebecois is the only voice to raise this issue in the

House. We urge the ministers of industry and heritage to do the same.

In conclusion, I inform the House that the Bloc Quebecois will support Bill C-57. Our position reflects the fact that the Bloc Quebecois is in favour of healthy and ongoing competition within the telecommunications sector resulting in profitable and competent telecommunications companies.

However, I must emphasize that the Bloc Quebecois will never let the federal government get away with neglecting its duty to prevent them from competing at consumers' expense.

[Supply, October 24th, 1996]

Madam Speaker, why are the members I just mentioned not standing up in this House at this time? I would like to hear from them. After all, they have the right to represent the views of their fellow citizens from the Montreal area. I am sure that they would have something to say on the subject. Why are we not hearing from them?

I would like my hon. colleague opposite, who made such complimentary remarks about the port of Montreal, to tell me why. Once the bill the House is currently considering, the one that will charge user fees for navigational aids is passed-I hope it will not but, unfortunately, the government majority holds the opposite view-when it is in force, resulting in the St. Lawrence seaway becoming less competitive in the eyes of a number of American carriers, what will happen to the port of Montreal then? Is Quebec, and Montreal and its port in particular, not at the mercy of yet another bad decision made by a centralizing government in Ottawa?

[Supply, October 24th, 1996]

Madam Speaker, I listened with interest to what the hon. member opposite just said. In a way, he just sang the praises of the port of Montreal. The fact is that Montreal did do rather well after all. I say after all on account of the statistics referred to earlier by the hon. member for Laurier-Sainte-Marie, data from our revered Statistics Canada indicating that for every dollar it pays in taxes to the federal government, here, in Ottawa, Montreal gets only 75 cents back. All in all, Montreal did quite well on its three quarters out of a buck. But how much more would Montreal have been able to accomplish with that last quarter? That is the real question. You see, for decades now, the problem has not taken the form of sword of Damocles dangling over our heads, but rather that of a ball and chain that we have to drag behind us all the time and that keeps getting heavier and heavier every time we send money to Ottawa. We keep getting less and less back and end up getting shortchanged.

I notice that the majority of government members standing up are not from the Montreal area. Where are the hon. members for Pierrefonds, Saint-Laurent, Verdun? I am not saying that they are not in the House-

[Supply, October 24th, 1996]

Madam Speaker, this is a very fine and articulate theory but what about practice?

Here is practice, and my question to the member opposite will be based on it. Last year, the Canadian government signed a contract for armoured vehicles worth $2 billion, that is $2,000 million. This is not peanuts. This very big contract was awarded without a call for tenders to, naturally, an Ontario manufacturing industry, which in turn subcontracted the turrets to a California company for $500 to $600 million, still without a call for tenders.

I know that in Saint-Jean, on the outskirts of Montreal, Oerlikon, which specializes in this type of equipment, could have fulfilled this contract at a competitive price, since there was no call for tenders. But it was not to be.

My question for the member opposite is this: Why did we choose to give our own taxpayers' money to workers in California rather than to workers on the outskirts of Montreal?

I want a concrete answer, not only rhetoric.

[Supply, October 24th, 1996]

Mr. Speaker, I listened carefully to the speech made by my hon. colleague opposite. If we believe what he said, things could not be any better. So, why have not only his government but the previous federal government and all the governments during the last 30 years allowed the economic situation in Montreal to deteriorate? It did not happen overnight, it occurred over a certain period of time.

We only have to think about the Borden line which closed down three refineries in eastern Montreal. About Mirabel airport that reduced traffic in Dorval without increasing its own, which explains why air traffic shifted to Toronto.

Earlier, I heard the hon. member put the blame on the political instability and so on. In 1966, it was a federalist and not a separatist government that was in office in Quebec, as far as I know. And in 1976, Mr. Bourassa ran into trouble with the Borden line, which led to the closure of three refineries.

In 1984, Mr. Bourassa was re-elected and remained in office until 1994. Of course, we had Mr. Johnson the last few months but all these Quebec leaders supported federalism. Meanwhile, Montreal was getting poorer and poorer. To argue that the sovereignty issue or political instability was at the origin of Montreal's problems is totally wrong.

In fact, let us examine these things clearly. Canada has a free trade agreement with Israel. As far as I know, people are not throwing rocks or firing machine guns off in the streets of Montreal, but such things do happen every day in Jerusalem. So, please, do not bring up the issue of political instability.

We are talking about helping Montreal with some investment. We know that the government opposite donated $11 million to Vietnam. Vietnam is a fine country, I agree, but let us not forget that Montreal is the poorest city in our country. Montreal needs $7 million for the Tokamak project to go on. Can the hon. member tell me why his government seems to prefer Vietnam to Montreal?

[Supply, October 24th, 1996]

Then, is it yes or no?

[Supply, October 24th, 1996]

Thank you, dear colleagues.

So, essentially, the secretary of state is promising strategic action, an action plan, is explaining the past, but is he ready to commit yourself, before the House, his colleagues and the public, to spend that fourth quarter in Montreal, so that next year Statistics Canada will be able to say that 25 per cent of all Canadian expenditures have been made in Quebec and that Montreal got its full and fair share? Or will there be, one year from now, another official opposition day when we will once again stand in this House and say that Montreal is once again not getting its share? I await his answer.