Pierre De Savoye

[Questions On The Order Paper, September 22nd, 1994]

In the Department of Health estimates, has the government provided for an amount of money for Canada's anti-drug strategy and, if so, ( a ) what is that amount; ( b ) what proportion of that amount is allocated to alcoholism problems; and ( c ) what proportion of that amount is allocated to problems involving drugs other than alcohol and tobacco?

[Questions On The Order Paper, September 19th, 1994]

Has the government allocated an amount of money to the anti-smoking campaign and, if so (a) what is the amount; and (b) what proportion of that amount will be devoted to (i) research; (ii) television publicity; (iii) radio publicity; (iv) publicity posters; (v) the hiring of new peace officers; (vi) a market study; (vii) prevention and education programs; and (vii) other aspects?

[Non-Confidence Motions, June 15th, 1994]

Mr. Speaker, on January 20 this year, the hon. member for Mission-Coquitlam tabled a motion whose purpose-and I say this for the benefit of our listeners who may be wondering where all this started-was to allow members to express themselves freely and to vote against the party line, without fear of bringing down the government should a vote, fortunately or unfortunately, go against the government, and the hon. member made it clear such a vote should not be interpreted as a motion of non-confidence.

That being said, there are a number of elements in this motion, and I am trying to put them in order because to discuss the amendment to the amendment without discussing the main motion would be to overlook the broader implications. When we talk about a free vote, and I read the hon. member's speech, we are talking about seeking the views of constituents to ensure that the member responds to these views through the way he votes in the House. Supporters of a free vote claim this is necessary if the member is to fully represent the views of his constituents.

Nothing could be further from the truth. You will agree, Mr. Speaker, that the member's role is not just to represent the views of his constituents but also and above all to promote the interests of those constituents. In fact, we all realize that our constituents do not all share the same views. There is a wide range of views. There is also a range of interests. So how do we pick and choose between these views and interests? Are we supposed to turn into a calculator and wait until the telephone rings and the mail comes in and see which pile is the biggest? This pile is bigger so we should do that. Good heavens, if that is what a member is supposed to do, a calculator could do the job.

I believe members are also and above all elected for their good judgment, or at least I hope so. Whatever we discuss, the member will have to examine the issues, talk about them, do research and finally get a handle on the subject. This is not a matter of opinions or interests, it is a matter of having a good grasp of the issues. Through his membership in various committees and through his own research and the research done by his staff, a member is able to develop and define his position, in the best interests of all his constituents. This exercise cannot take place in a vacuum.

We have to meet our constituents. Like all members, when I am in my riding on Friday, Saturday and Sunday, I try to meet as many constituents as possible. I go to various meetings, I take part in a number of festivities, I meet members of municipal councils, senior citizens clubs and chambers of commerce, I meet business people, workers and various types of employees, and I listen. I listen to what they have to say, I check their interests, I tell them about the results of my research and my studies, and I explain what I have seen and heard.

Through dialogue, and not through the use of a calculator, I can better identify the real issues and ensure improved services and a happier life for my fellow citizens. Our constituents' opinion serves as a guide helping us to better target our research and better serve our ridings.

In reality, an MP is never alone. He or she works with a caucus and also with all the other parties in this House. Indeed, even if I thought I had the best ideas for my constituents, I would still have to convince my peers, first the members of our caucus and, eventually, the members of this House.

How can that be done, if not through the processes in place? I am not saying that these processes are great. In fact, I think they are totally outdated and ineffective, but they are there and we must make do with them.

I would first check in committee to see if my ideas get the support of my peers, and then I would turn to my caucus. I would also try to find out if other MPs from my region share similar views. We all have constituents who, up to a point, share the same concerns, worries and hopes. We have to find solutions which suit the population as a whole.

So, are those ideas of mine as good as I think they are? The regional and national caucus would enable me to find out what my colleagues think. They too, of course, have ideas. I am not the only one to have useful information or brilliant ideas. My colleagues express their views and this dialogue eventually leads to a decision, by the caucus, as to which solution is the most adequate for all the members.

Within our caucus, my vote is strictly a personal decision. I can always freely express and discuss my views, hear other opinions, and eventually accept a consensus. Consequently, when I come here in the House, I back the position developed by the caucus, and not just my own point of view.

It would be extremely simplistic and probably somewhat pretentious on my part to think that I have this ability to come up with the best solutions. In that context, it is easy to see that a free vote would become an excuse to bypass party colleagues and openly express dissenting opinions. This is not what the democratic process is all about. Rather, it means that we go and get the information from our constituents, that we get any other information available, that we put it all together to come up with acceptable solutions, all the while benefitting from our colleagues' experience and knowledge, before finally reaching a consensus on the best solution, which we, as members of a caucus, then defend in this House, in accordance with its rules.

[Bankruptcy Act, June 9th, 1994]

moved that Bill C-237, An Act to amend the Bankruptcy Act (priority of claims), be read the second time now and referred to a committee.

Mr. Speaker, the purpose of this bill is to change the priority of payment of claims in case of employer bankruptcy, in order that the wages, salaries and pension plan contributions of employees, up to a limit of $9,000, be paid in priority to any other class of claims.

The Bankruptcy and Insolvency Act passed in 1992 maintains preferred status for wage and entertainment expense claims in the event an employer goes bankrupt. The limit was increased from $500 to $2,000 with regard to wage claims, and from $300 to $1,000 in the case of entertainment expenses claims.

When an insolvent employer offers to restructure his company, unpaid wages up to a limit of $1,000 have to be paid to employees as soon as the restructuring plan had been approved by the court. The issue of wage claims in the event of an employer becoming bankrupt or insolvent was widely debated in Canada in the context of the legislative reform on bankruptcy.

In the last bill to amend the Bankruptcy Act, which was tabled in 1991, the government proposed to establish a compensation fund for unpaid employees. Because of the opposition to the tax intended to finance the program, however, this measure was withdrawn and replaced by a simple change in priority, which has been granted to wage claims for years in Canadian legislative enactments on bankruptcy.

When the Act to amend the Bankruptcy Act, since renamed the Bankruptcy and Insolvency Act, received royal assent on June 23, 1992, the Minister of Consumer and Corporate Affairs stated his intention of striking a joint committee of the House of Commons and the Senate to examine the issue of salary protection in case of insolvency. This committee which was to table its report by June 1993 was never established.

Now, Mr. Speaker, let me provide the House with some background information to put the problem with this bill in full context. It all started in 1919, with the Bankruptcy Act giving wage claims priority over unsecured debts for a period of up to three months before the bankruptcy. Wage claims came third at the time, after professional, trustees and seizing creditors fees.

The Bankruptcy Act of 1949, maintained the priority given to wage claims for a period of three months before bankruptcy occurred, but also set a $500 limit per claim. Travelling salesmen were allowed to claim $300 more for unpaid expenses. Thereafter, wage claims ranked fourth in the order of priority of preferred claims.

Toward the end of the 1960s, a committee was appointed to review and report on the Bankruptcy Act. With this committee, known as the Tassé Committee, the government embarked upon a legislative reform on bankruptcy. In its report presented in 1970, the committee recommended that the period in question be limited to three months, but that the limit on preferred claims be raised to $1,000.

Five years after the Tassé Report was tabled, on May 5, 1975, Bill C-60 was introduced in first reading in the House of Commons by the then Minister of Consumer and Corporate Affairs who has since become Minister of Foreign Affairs.

The purpose of that bill was to give wage claims of up to $2,000 per employee top priority over any other secured or unsecured creditor. Fiercely criticized, this "top priority" proposal was rejected by the Senate Standing Committee on Banking, Trade and Commerce in its report on the bill. The committee argued among other things that this top priority did not ensure employees would be compensated and could in fact disadvantage borrowers trying to obtain credit, especially in labour intensive sectors. As an alternative, the committee recommended establishing a government-operated employee compensation fund to which employers and employees would contribute and from which wage claims of up to $2,000 could be paid to employees. However, none of the three bankruptcy bills tabled in the Senate in 1978 and 1979 provided a compensation fund for employees or superpriority. Employees instead kept their status as preferred creditors and the amount of wage claims was increased to $2,000 plus $600 for business travel expenses and up to $500 for contributions to pension plans and fringe benefits.

In 1980, another bankruptcy bill, C-12, was tabled in the House of Commons by the same minister. It contained the same salary protection provisions as the previous Senate bills. After considering it, the Standing Senate Committee on Banking, Trade and Commerce again recommended creating an employee protection fund. The committee thought that the fund which would pay salary compensation of up to $2,500 should be financed from employer contributions and administered by the Superintendent of Bankruptcy. The fund would be subrogated to all employee claims against a bankrupt employer.

In this context, the Minister of Consumer and Corporate Affairs in 1980 asked a task force to look into the question of employee protection. Although the Landry Committee saw there was a problem with unpaid wages, it said in its 1981 report that it could not determine its scope. It thought that no permanent solution to the problem could be found until the extent of the problem was known and federal and provincial policies were co-ordinated. The committee favoured creating a salary protection fund and recommended a temporary solution for three years during which the treasury would pay salaries due, including benefits, up to $1,000.

Although tabled in 1980, Bill C-12 was only referred to a parliamentary committee in October 1983. The Minister of Consumer and Corporate Affairs then proposed amending it so as to give superpriority to unpaid wages, not counting severance and termination pay, of up to $4,000 if an employer went bankrupt. The amendments would have allowed a bankruptcy trustee to borrow to pay wage claims and to secure the loan. The recommendations of the Landry committee were rejected because of budget constraints and because of the lack of foolproof data on the wages lost as a result of bankruptcy and the problems that could arise if a wage protection fund were created. The minister was also concerned that if such a fund existed, employers would no longer feel compelled to pay their employees' salaries on time.

Bill C-12 which died on the Order Paper was reintroduced as Bill C-17 on January 31, 1984 by Mrs. Judy Erola who was the Minister of Consumer and Corporate Affairs at the time. However, it did not contain any amendments respecting first priority. That same year, however, the Minister of Consumer and Corporate Affairs brought in new amendments which would give first or superpriority to salary claims up to a limit of $4,000, including legal costs up to a limit of $600.

In late 1986, the Minister of Consumer and Corporate Affairs released a working paper on proposed amendments to the Bankruptcy Act. The proposals flowed from the report of the advisory committee and from consultations between the minister and concerned groups and provinces.

The working paper called for a salary compensation fund to be established to cover possible cases of bankruptcy or receivership. The fund would have paid up to $2,000 in unpaid wages, including statutory benefits and up to $1,000 for unpaid expenses incurred on the employer's behalf.

The fund would have been financed through employer and employee dues and would have been administered by the superintendent of bankruptcy. Pursuant to the bill's provisions, the federal fund would have priority over provincial laws, would be subrogated to the rights of employees and would constitute a preferred creditor.

The department estimated that the fund would pay out between $30 million and $50 million annually.

In 1989, another report recommended creating a national wage earner protection fund. The Advisory Council on Adjustments, which was asked to examine adjustment issues arising from the Canada-U.S. Free Trade Agreement, supported creating a national wage earner protection fund which would pay workers up to a maximum of $4,000 and would be financed by contributions from employers.

In June 1991, new bankruptcy legislation, Bill C-22, was tabled in the House of Commons. The new measures provided for a wage earner protection program similar to the one proposed in 1988. The program was included in a new act, the Wage Claim Payment Act.

The bill was referred to the Standing Committee on Consumer and Corporate Affairs and Government Operations for preliminary consideration. Most witnesses appearing before the committee favoured a wage protection program, but many objected to the program being financed by a tax on wages.

In its preliminary report, the committee rejected the concept that a wage protection fund was the only way to guarantee recovery, and it proposed a combination of superpriority and a wage protection fund. The committee also noted that the fund proposed in Bill C-22 would not protect employees who had not been paid because the employer had abandoned the business. It recommended that the government consider ways to reimburse wage arrears in such cases.

The government rejected the committee's recommendations. Procedural problems within the Standing Committee forced the government to reverse its position on wage protection, however, and in May 1992, the Minister of Consumer and Corporate Affairs announced the withdrawal of this part of the bill.

As a result, the Bankruptcy and Insolvency Act passed in 1992 maintains the status of secured creditor with respect to claims for salaries and representation costs in the case of employer bankruptcy, but claim-limits were increased from $500 to $2,000 for salaries and from $300 to $1,000 for representation costs.

The Bankruptcy and Insolvency Act provides for a review of the provisions of the act by a parliamentary committee three years after coming into effect.

I would now like to address Bill C-237. The proposed legislation would amend the Bankruptcy and Insolvency Act to give claims arising from salaries and unpaid contributions to pension plans priority over all other claims in the case of the bankruptcy of an employer, including claims of secured creditors, up to a limit of $9,000. This bill reflects the provisions of a previous bill that would have given wage earners superpriority over other creditors.

As we have seen, granting superpriority to unpaid wages raises a number of problems. First, superpriority does not guarantee that wages owed by a bankrupt employer will be paid. The available assets of the bankrupt are not necessarily adequate to cover the amounts claimed.

Second, superpriority of wage claims might reduce the amount of credit offered to labour-intensive businesses.

Third, it might be difficult to distribute the burden of superpriority among creditors.

Fourth, some lenders might be tempted to circumvent superpriority by demanding that the loan be in the name of an affiliated company that would own all the assets of the borrower.

Finally, since wage claims can only take precedence once bankruptcy proceedings have started, secured creditors might be tempted to exercise their right outside the bankruptcy process to preserve their priority.

I am sure you will agree that wage earners deserve special treatment when their employer becomes insolvent. For many wage earners, their job is their main if not sole source of income. One of the most common ways of ensuring that workers get their unpaid salaries in case of bankruptcy is to give priority status to their claims.

A preferred creditor is an unsecured creditor who has the right to be paid before other unsecured creditors. This means that salaries are paid, or could be paid, out of the assets of the bankrupt, but before payment of secured creditors.

Under the terms of the current Bankruptcy and Insolvency Act, salary claims and disbursements of travelling salesmen have priority in case of bankruptcy but, as we said, there is a limit of $2,000. As a result of inflation, this is a very small amount which does not give much protection to employees.

Several arguments can be used to justify a superpriority of claims. First, the present system which gives preferred status to salary claims is seriously lacking, and the same can be said for the claims of secured creditors and preferred creditors of higher rank that must be paid first.

Second, with a superpriority, employees would have a better chance of being paid quickly. Very often they would not have to wait until all the assets of their employer have been disposed of.

Third, a superpriority would enable employees to be paid at no cost to the government or taxpayers. Recently, some people proposed setting up a fund managed by the government. I remind you that this proposal was rejected. With a superpriority, it is up to the employer to pay salary claims, and they are paid out of his assets.

Fourth, the danger that such a superpriority would hinder a company's borrowing power is probably exaggerated. Some say that if salary claims had superpriority, companies would have trouble getting credit because wages would come before securities such as mortgages and bonds.

The bill contains provisions limiting the impact of wage claims on other creditors. Employee claims would not all be honoured in full. Priority would be limited to wages and pension plan contributions for the six months preceding the bankruptcy, up to a limit of $9,000.

Moreover, the present Bankruptcy and Insolvency Act now gives unpaid suppliers the right to reclaim their goods from bankrupt buyers, which in fact places them ahead of secured creditors.

I believe I have demonstrated how important Bill C-237 is. The historical background of this issue, which I just presented to the House, proves beyond any doubt, that wage protection in a bankruptcy context has been justifiably a main preoccupation of the House since 1919, and especially in the past few years.

I then clearly explained how Bill C-237 was in the same line as previous bills and how it avoided problems associated with a compensation fund and superpriority.

Today, I am asking the House to take a step forward towards wage protection in a bankruptcy or insolvency context, and when the time comes, to support Bill C-237, and send it for review to the Committee on Government Operations so that workers in this country can enjoy the wage protection they so rightly deserve.

[Credit Card Interest Calculation Act, June 7th, 1994]

Madam Speaker, I welcome the opportunity this evening to add my comments to those made by my colleagues on Bill C-233.

Since we already know this bill will be referred to committee, I will not dwell on its merits which would otherwise have been ample reason for me to warmly recommend this legislation. Nevertheless, I would like to add to the remarks of the previous speaker by providing some further emphasis, to be absolutely sure the committee realizes that this bill enjoys strong support in this House.

I may recall that since the early eighties, three parliamentary committees have examined the credit card industry in Canada. In 1989, the Standing Committee on Consumer and Corporate Affairs focused on the importance of disclosure, while in 1992, the committee considered the possibility of restricting entry fees. In 1987, the Standing Committee on Finance looked at the size of the competition.

Although the themes were different, the three studies all focused on the high rates of interest applied to credit cards and the fact that these levels were maintained while all other types of interest went down.

In 1989, the committee recommended that the maximum rate for cards issued by financial institutions should be set at 8 percentage points above the bank rate, while in 1992, the committee recommended against setting limits.

During the last Parliament, three members, including two Conservative members, Don Blenkarn and Louise Feltham and one NDP member, John Rodriguez, tabled private members' bills on credit cards, which shows that the issue is not new to Parliament and that there has been a constant expression of concerns which today has finally found its way to committee through this motion.

I would like to add that not long ago, on March 21, I myself tabled two bills on this subject. I am referring to Bill C-227 and C-228, which deal substantially with the same concerns, in more or less the same terms, as Bill C-233.

I am therefore delighted to express my support this evening for what was said by the hon. member for Simcoe North. It must be recognized that the interest rates charged to consumers using a credit card do not at all reflect the actual cost of credit to these consumers. These consumers are simply being exploited.

To some extent, Bill C-233 differs from the legislation which I tabled in this House, in first reading. For the benefit of the committee which will review this issue, I would like to point out a number of differences and explain why I am inclined to support the changes which I proposed.

The French version of clause 9(1) of Bill C-233 says that interest is calculated on a monthly basis, whereas the English version makes no mention of that. In Bill C-227, which I tabled, clause 5.1(1) specifies that interest shall be calculated monthly.

In Bill C-233, cash advances are excluded from clause 9, whereas Bill C-227 does not exclude such advances.

Clause 10(1) in Bill C-233 excludes-although I do not know if this was intended-those who contravene clause 3. As you know, clause 3 refers to financial institutions which charge or stipulate entry fees, renewal fees, etc., in relation to the use of a credit card. So, those who contravene this provision are not included in the clause on fines. Bill C-228, which I tabled, imposes for fines to any offender, including those who charge or stipulate entry fees or renewal fees.

In Bill C-233, clauses 10(1) ( a ) and ( b ) provide for maximum fines of $75,000 and $50,000 respectively. In Bill C-228, we propose the same fines; I guess we consulted with the same researchers. However, unlike Bill C-233, our bill also proposes minimum fines.

The hon. members for Simcoe North and Trois-Rivières both referred to the study on credit cards conducted by the Service d'aide aux consommateurs, and more specifically by Mrs. Madeleine Plamondon, and Messrs. Henri-Paul Labonté and Marc Pépin. I should point out for the benefit of this House and the committee which will look at this issue, that the study was made possible through a grant from the Department of Industry. This not only gives it credibility, since it is already credible considering who conducted it, but also makes it very appropriate since it was financed by public funds.

Already on page 2 of the study, the substance of the message is delivered. The authors say that their conclusions deal with the accountability of credit card issuers and the urgent need for the government to review this issue, which is obviously what we are doing here this evening. I will conclude by saying that there is real support among the public for such a measure. For example, the Borrowers Action Society wrote to me about my bills, but I want to share the benefit with the hon. member for Simcoe North. This organization wrote:

"We are very pleased to see the initiative you and the BQ are taking in this area and I wish to offer my full support as well as the support of the Borrowers Action Society. We have 7,000 identified supporters from all parts of Canada. If you think we can help in any way, please let us know".

[Credit Card Interest Calculation Act, June 7th, 1994]

Madam Speaker, just to clarify the situation, what is the alternative?

[Thalidomide Victims, June 7th, 1994]

Mr. Speaker, does the minister not realize that in most cases, the only possible proof available is circumstantial and that it is precisely because the federal government is demanding from victims this type of proof that they are being denied justice?

[Thalidomide Victims, June 7th, 1994]

Mr. Speaker, my question is for the Minister of Health. Last week, La Presse reported that the majority of thalidomide victims had yet to receive any compensation. Of the 424 who applied, more than 318 are still waiting for the federal government to process their files.

Does the Minister of Health intend to intervene so that the victims of this tragic incident for which the federal government has already admitted responsibility can finally be compensated?

[Hepatitis C, May 31st, 1994]

Mr. Speaker, the minister lets the provinces take the blame, and meanwhile, the lives of thousands of people are at stake.

When will the minister realize that the problem is at this level, that it must be solved at this level and that she is responsible for doing so?

[Hepatitis C, May 31st, 1994]

Mr. Speaker, my question is directed to the Minister of Health.

We have repeatedly asked the minister in the House whether she intends to act responsibly and make arrangements to inform people infected with Hepatitis C of their condition and the risk of transmitting the disease to others. The minister tends to evade the issue while the lives of thousands of Canadians are in danger.

Has the minister finally realized that her first duty is to inform people who may have been infected in order to slow down the development of the disease and stop its transmission?