David McGuinty

[Bankruptcy and Insolvency Act, December 3rd, 2004]

Mr. Speaker, it is a pleasure to respond to Bill C-281. I congratulate the member for Winnipeg Centre. There is no doubt that wage earners need protection when their employers go bankrupt. Everyone in the House is concerned about this problem and has been for a long time.

Over the years different options for wage earners' protection have been considered. They have been considered here and each with its own benefits and drawbacks.

I would like to offer up some comments as a former unionized worker, as a former small businessman and as a recovering corporate lawyer.

In examining the various options, one question has to be answered and it is this. Is this approach fair to all parties? Make no mistake, bankruptcy means there will be a shortfall and not all debts will be paid. All parties suffer in a bankruptcy, including employees, creditors, suppliers and the owners of the company.

Our challenge here is to find the proper balance in the protection of these various interests.

While it is difficult to say that the protection of workers, the backbone of our economy, can go too far, I believe Bill C-281 does just that. It goes too far. The bill throws all balance and equity out the window. It represents a radical departure from the existing system, one that if adopted into law, could have a dramatic effect on the economy and the very workers that it seeks to protect.

Let me explain. The solution proposed in Bill C-281 is straightforward, an unlimited super priority for all employment related claims to all of the assets of the bankrupt company. In addition to wages and vacation pay, it would add termination, severance pay and other benefits. It could also add protection for pensions, including unfunded liabilities.

The liabilities, in particular the unfunded liabilities, can be huge, outstripping the value of the company's assets and the company's ability to pay.

Due to the magnitude of the super priority contemplated in the bill, it could have serious effects on credit and capital access, particularly for higher risk new businesses, particularly high technology companies, over 1,500 of which exist, for example, in my region here in the National Capital region.

Creditor claims, even those that are secured under the appropriate law, would fall below employment related claims. If all the company's assets go to satisfy worker claims, there would be nothing left to pay remaining creditors. Creditors would be less certain about their ability to collect debts owed to them and it could be assumed would be less interested in investing in Canadian companies.

We must also consider smaller creditors, such as trades people and suppliers. These individuals are in many cases no more capable of protecting their interests than workers. Small businesses and independent contractors take risks when they supply other companies, and our system must respect their efforts as well as their claims in bankruptcies.

Again, we come back to the issue of balance. The underlying factor is that disharmony in the system will have potential economic costs. If credit is not available, businesses will not expand and they might even contract. If business does not expand, new jobs are not created and labourers will see less demand and less opportunities for their services.

The protection of wages must not be examined in a vacuum. Insolvency reform cannot eliminate risk or harm. It should strive to strike the best possible balance of the needs of all parties in a bankruptcy proceeding. The fact is that bankruptcy is about not having enough money to go around. The issue is how best to allocate that shortfall when everyone deserves to be paid.

Bill C-281 does not strike the right balance. It attempts to benefit one group in the equation, while placing an unfair burden on the others. To be sure, the super priority proposed by the bill is not the issue. Indeed, it might be a proper approach to take, but the balance proposed in this bill is off.

It is the position of the government that finding the right balance will require additional study. Reform in this area should wait for the results of the Industry Canada review of this and other insolvency related issues.

I would like to address one other element of the bill that has not received enough attention. The proposed bill also amends the Canada Business Corporations Act. I would commend to my colleague, the member of the NDP, to listen and learn carefully about how the Canada Business Corporations Act actually grants the minister of labour the power to appoint an adjudicator to hear and resolve wage claims by employees.

While it can be appreciated that everyone's best interests are served when claims of this sort are settled quickly, it is unclear as to why the bill would replace the courts as the mechanism for settling these disputes.

The Canada Business Corporations Act already has provisions for wage liability for directors. Right now the directors of a corporation are jointly and severally liable for six months of wages owing to employees in the event of a bankruptcy. This is an absolute liability. There is no statutory defence. These claims, even in a moderate sized corporation, can achieve sums in the millions of dollars.

The courts already have the expertise to deal with large claims of this kind. The small claims courts can deal with situations that involve only a few employees. In any event, given that wage liability is absolute, all that remains for a court to do is satisfy itself that the claim is valid and order the payment. The bill adds little except to set up a parallel system without some of the usual due process rules, including a specific prohibition of a right of appeal. Due process in my estimation should not be capriciously discarded. Despite the cost, the rigorous standard created by an absolute liability offence justifies having the safeguards consistent with a formal court proceeding.

Under the provisions of the bill, the adjudicator may summon and enforce the attendance of witnesses, compel testimony, compel the production of documents, administer oaths and order directors to pay employees the wages owing. This sounds like a court to me. Substitute the word judge for adjudicator and we have a system very much like that which currently exists, and one that operates transparently, fairly, and without the additional layers of bureaucracy. I see no need for these provisions.

The government agrees that wage protection is deserving of attention and is actively exploring the options to deal with this important issue. The solution put forward in Bill C-281 is neither practical nor reasonable, insofar as its effects on other stakeholders. It ignores the concept of balance. It favours one group to the exclusion of all others. It ignores the economic impact of unlimited super priority. It ignores the interests of the many creditors, both large and small, who by taking risks and supporting Canadian business, allow our economy to flourish and allow so many of the hundreds of thousands of jobs to be created in the first place.

[Labour, December 3rd, 2004]

Mr. Speaker, the Minister of Labour has announced the first comprehensive review in 40 years of part III of the Canada Labour Code. Part III of the code establishes basic conditions of work and provides protection for some one million employees, 10% of the Canadian workforce.

Could the minister tell the House what this review will encompass?

[Federal-Provincial Fiscal Arrangements Act, November 29th, 2004]

Mr. Speaker, it is a pleasure and an honour to speak this evening to Bill C-24. Canadians understand that equalization has been one of the pillars of our federation for more than four decades now. To begin with, the equalization and the territorial formula financing programs ensure that all Canadians, no matter where they live, have access to reasonably comparable public services. This commitment helps to ensure that all Canadians are treated equally from coast to coast to coast.

However, the provinces and territories have been complaining for several years now about how the federal government funds the equalization and territorial formula financing programs. They have spoken about the planning difficulties they face as a result of the year to year swings in the amount of payments they receive under these programs.

These are legitimate concerns and our government has done everything we can to address them. However, the very good news is that on October 26, Canada's premiers and territorial leaders agreed to the government's framework for equalization. This new framework represents the most fundamental and sweeping changes in the program's history. The goal of this new framework is nothing less than to make payments to the provinces and territories more stable and predictable, while significantly increasing the overall level of funding.

The new framework includes five elements: first, an overall floor of $10 billion for equalization and $1.9 billion for territorial financing for the current fiscal year; second, complete protection for provinces and territories against overall individual declines in payments in 2004-05; third, an increase in the funding base for 2004-05 rising to $10.9 billion for equalization and $2 billion for territorial financing; fourth, a guarantee that equalization and territorial formula financing payments starting in 2006-07 will grow by 3.5% per year until 2009-10; and finally, the creation of an independent panel to provide advice on allocating these moneys among provinces and territories.

Let us take a look at what these changes will mean. Over the next decade, this new framework will provide $33 billion more in equalization and territorial financing payments to the provinces and territories. That is an astonishing sum of money. For the sake of comparison, it means that equalization payments will increase from $8.9 billion in 2004-05, what they would have been without the new framework based on the earlier estimates, to $12.5 billion by 2009-10. That represents an increase of 42% overall, or more than 7% per annum on average.

The idea that Canadians should have access to the same high quality of health and social services regardless of where they live is so fundamental to the fairness and integrity of the Canadian federation that it is protected by the Constitution in the form of equalization.

In short, the equalization program transfers money to the less prosperous provinces and territories in accordance with a formula based on the revenue raising capacity of each province. This means that as a province becomes more prosperous, its equalization entitlement declines.

In fact, equalization payments are designed to make up the difference so that Canadians in any part of the country have access to the quality social and health services they expect and demand.

As well, they prevent the less well-off provinces from having to resort to tax rates that would be bad for the economy in order to be able to afford to deliver such services.

In order to cast some light on the importance we assign to the equalization program, I would remind hon. members that the Prime Minister has announced an improved equalization framework. This new framework represents probably the most important change in the program in its history.

The intent of the changes is to bring stability, predictability and growth to the overall level of funding for these programs, in accordance with third party advice on the best way for the Government of Canada to allocate payments among the provinces and territories.

The changes to the programs would encompass three important elements: complete protection for provinces and territories against overall and individual declines in payments in 2004-05; a new framework for equalization and territorial financing starting in the fiscal years 2005-06; and an independent review of the programs by a panel of experts.

The new framework will, therefore, make payments to provinces and territories more stable and predictable, and ensure the sustained growth of financial assistance.

With respect to the financial impact, over the next 10 years the new framework for these programs will be $33 billion more in equalization and TFF payments to provinces and territories than the amounts estimated at the time of budget 2004, a significant increase.

The equalization program is a faithful reflection of the sense of sharing that characterizes the Canadian nation.

I would also be remiss if I did not point out to the House that our government is committing an additional $41.3 billion for health care as part of its 10 year action strategy on health, agreed to by the Prime Minister and the provincial and territorial leaders last month. This brings me to my closing point.

This new $33 billion framework for equalization and territorial formula financing, when combined with the $41.3 billion in new health care funding, will result in a cumulative and whopping increase of $74 billion in new money transferred from the federal government to the provinces and territories over the next 10 years. By any stretch of the imagination, this is a huge sum of money and it illustrate's our government's commitment to ensuring that Canadians are treated fairly and have access to reasonably comparable levels of service, no matter where they live in the country.

The significant influx of new money to support health care and other national priorities is the direct result of two specific initiatives. Let us give credit where credit is due. First, the hard work and sacrifice hundreds of thousands of Canadians who helped boost our economic performance to a level that is the envy of our G-7 counterparts and a host of other industrialized nations around the world. Second, it is also a product of our government's commitment to disciplined spending practices, balanced budgets and debt reduction.

Since 1997, we have posted seven consecutive balanced budgets and reduced our federal debt by more than $61 billion. This has freed up an additional $3 billion annually and lower interest charges to help fund the priorities of Canadians.

Our government recognizes the need to ensure that all provinces and territories can offer the best possible services to their citizens. The equalization and territorial formula financing programs are clear evidence of our commitment in this area.

[Biotechnology, November 29th, 2004]

Mr. Speaker, I am pleased to announce that today is the opening day in Ottawa of the 11th annual BioNorth, Canada's international biotechnology and life sciences conference and exhibition. This year's theme is “Commercializing the Success Gene--The Business of Science and the Science of Business”.

The Ottawa life sciences sector is ranked third in employment in Canada, behind only Toronto and Montreal. The Montreal, Ottawa and Toronto biotechnology corridor is second in the world only to California's cluster.

By organizing BioNorth, the Ottawa Life Sciences Council showcases Ottawa and Canada's opportunities on the global stage and, through partnerships and investment, stimulates economic growth.

The Ottawa Life Sciences Council would like to acknowledge the Prime Minister's Office and the Canadian Biotechnology Secretariat as well as other Government of Canada departments for collaborating on BioNorth this year to deliver a biotechnology policy forum on Wednesday, December 1, forecasting opportunities in biotechnology while promoting understanding of the issues surrounding biotechnology and the growth of this sector in Ottawa and Canada.

I would encourage all members of the House and their staff to take part in BioNorth 2004.

[Canada Labour Code, November 25th, 2004]

Mr. Speaker, I am pleased to rise to speak to Bill C-263, introduced by my colleague, concerning the use of replacement workers during strikes and lockouts. There is a very important point of principle that we should keep our eye on as a House and as members.

When we go back to the Sims report of 1995, there was never total unanimity on the report's recommendations with respect to replacement workers. Certainly, the matter of replacement workers was a highly contentious issue in 1995, when that multi-stakeholder task force was struck precisely to advise the government on how it should proceed and how it should move forward.

This existing situation is a reasonable compromise that gets us to the heart of the matter. The current provision concerning replacement workers is a compromise like so much Canadian legislation.

During the proceedings of the Sims task force in 1995 the unions were asking for a complete prohibition of replacement workers during legal work stoppages, but the employers refused all limitation of that order. The task force came to the conclusion that a reasonable solution could be found halfway between these two extremes.

That solution was to allow the use of replacement workers provided the union can lodge a complaint with the Canada Industrial Relations Board if it deemed replacement workers were being used to weaken its capacity to fairly represent its members.

This is the important point of principle that we should recognize. Some will argue that the employer's countervailing power to the union's right to strike is the lockout. That is not so. The countervailing power to the union's right to withdraw its labour is the employer's right to continue to try operate its business during a strike.

The 1999 compromise was intended to balance the competing interests of the parties. The task force said that employers should be able to try to keep their businesses operating as long as they were not using replacement workers for the purpose of trying to undermine the union.

Here is a quote from the task force. It states:

Replacement workers can be necessary to sustain the economic viability of an enterprise in the face of a harsh economic climate and unacceptable union demands. It is important in a system of free collective bargaining that employers maintain that option unrestrained by any blanket prohibition....It is only in exceptional circumstances that replacement workers are used for an inappropriate end.

That was the view of the multi-stakeholder deliberative process that led to the compromise situation we now see in the legislation.

I think this is a pretty fair compromise in terms of the values and interests of both the employers and the unions and workers.

The fact is most major federally regulated employers do not hire replacement workers. It is my understanding there have been only about 15 cases taken to CIRB and of the three decisions issued to date none of the circumstances have been found to be in violation of the law.

The changes to the code have been in play for about five years now. The current provisions of part I are as a result of compromise. They representing a balancing of the interests of labour and management.

The current provisions in Canada Labour Code work well. We should never break up a winning combination. As a result, I do not believe these provisions should be changed at this time.

[The Environment, November 25th, 2004]

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

In 2000 the Prime Minister, in his capacity as finance minister, committed to developing national environmental and sustainable development indicators to help improve overall decision making in Canada. At that time the Prime Minister stated that the current means of measuring progress were inadequate and that these indicators could well have a greater impact on public policy than any other single measure we might introduce.

Could the Minister of Finance please report on the progress his department is making in implementing these indicators?

[Hiv-Aids, November 23rd, 2004]

Mr. Speaker, we all know that the best predictor of future behaviour is past behaviour. Media reports today again raise fundamental questions with respect to the Conservative Party's lack of empathy for human suffering caused by HIV-AIDS. Although the Conservatives are desperately trying to re-brand themselves as more moderate, once again Canadians get a real look at their views from a prominent member of that party.

My question is for the Minister of International Cooperation. Could the minister please tell us what the government and what we on this side of the House have done to demonstrate empathy for this important cause while dealing with--

[Department of Public Safety and Emergency Preparedness Act, November 16th, 2004]

Mr. Speaker, I am delighted to rise to speak in support of Bill C-6, an act to establish the Department of Public Safety and Emergency Preparedness and the amend or repeal certain other acts.

I know I do not need to remind the members of the House that we live in an increasingly interconnected, complex and often dangerous world. It is a time when new threats have emerged and old hatreds find new expression. It is a time when the responsibility to protect the security of Canadians has never been more compelling, or the array of dangers more diverse. It is an environment in which old planning assumptions simply no longer hold and the implausible is now plausible, where we must prepare for the unforeseen and respond to the unexpected.

Technology has given terrorists new reach and new weapons. The horrific events of September 11 and the bombings of commuter trains in Madrid in March of this year reminded us all that terrorism knows no boundaries nor respects any life. As one of the countries named specifically by Osama bin Laden, Canada is well aware of the dangers we face.

On a more personal note, I am one MP in the House who happened to have been in Washington on 9/11, in meetings in downtown Washington, when the planes crashed, an experience which drove home the need to be ever vigilant as we move forward.

While terrorism is perhaps the highest profile threat, it is by no means the only one. There is the danger posed by the growing number of failed or failing states, which can serve as a haven for both terrorists and organized crime, contributing to global instability. Indeed, organized crime is a growing problem as it develops globalized networks that support the narcotics trade, weapons smuggling, money laundering, theft including identity theft, commercial fraud and extortion, as well as migrant smuggling and trafficking in persons.

Canadians also face the danger posed by the proliferation of weapons of mass destruction, including biological and chemical agents, weapons dangerous under any circumstances, but particularly so if they were to fall into the hands of terrorists or rogue states.

We also face new threats to our critical infrastructure. During the blackout of August 2003, we were again reminded of just how dependent we have become and therefore how vulnerable we are in a world connected by computer networks.

There are also natural disasters, and many parts of our country have been hit and hit hard in recent years by ice storms, floods, forest fires and even hurricanes. Lives were lost, property was destroyed, livelihoods ruined and the work of a lifetime wiped out in a matter of hours.

Certainly with the devastating impact of the SARS virus, the avian flu and mad cow, Canadians understand how highly mobile diseases can affect our health, our communities and our economy.

However, if the list is daunting, the responsibility is clear. Canadians expect their government to act and to act in all areas on all fronts. They know the dangers we face do not fit into neat little boxes and neither should our planning. What is needed is a comprehensive, cross-cutting approach, bringing together all the key players and services in the most efficient way possible.

Canadians want us to work in sync, not in silos, to coordinate more effectively and work more efficiently. Quite simply, in the face of the new normal, the new realities, Canadians expect us to work in new ways across jurisdictions, across disciplines and across borders. That is exactly what the government is proposing through the legislation before us today.

Bill C-6 brings together in one place the core functions of security and intelligence, policing and law enforcement, corrections and crime prevention, border services facilitation and emergency preparedness. It includes what many would consider the traditional core agencies associated with public safety, such as the Canadian Security and Intelligence Service, the RCMP, Correctional Services, the Canada Firearms Centre, the National Parole Board and the Canada Border Services Agency.

As a result, we are now in a position to provide a truly integrated response to all manner of emergencies and threats to our security, whether they be health related, natural disasters or from terrorists. This is a crucial capacity. After all, whether the disaster is deliberate, as in the case of terrorist attack, or accidental, as in the case of natural catastrophes like ice storms, or simply unforeseen and unforeseeable, as in the case of hazardous spills, fires or industrial accidents, the impact on Canadians can be equally devastating. Whether an electrical grid, for example, is shut down by lightening or by sabotage, we still have people without power, streets without lights and hospitals without heat.

While the elements of this new department are many, its mandate is clear: to protect the safety of Canadians. There can be no more fundamental or important role for government than that. After all, safety and security are the very foundations for every other right of citizenship, and the essential conditions for every other freedom.

What is unique about this department, its structure and composition, is that it offers Canadians an integrated response to security that covers the entire continuum of risks, from crime in their communities, to naturally occurring disasters such as flood or fires, to threats to national security.

One of the most fundamental aspects of our quality of life is the safety of our communities. That is why it is so important to get to the root causes of crime by putting in place more effective crime prevention programs, control access to firearms, and ensure effective correction and parole policies.

The addition of the national crime prevention centre to this department is a clear recognition of the fact that if we are to increase the safety of Canadians, we need to devote the resources where they are needed most, at the community level, before problems make their way into the justice system.

Other threats to the safety of our communities also exist, including, as I mentioned a moment ago, organized crime, which remains a major problem, particularly in our larger cities. Bill C-6 would enable us to work with authorities to fight organized crime and reclaim the streets for our citizens. While all threats ultimately affect individuals, threats to national security have the capacity to seriously impair the security of Canada. A growing number of international security threats could have a direct impact on the national security of Canada. We need to have the ability to move along the continuum of danger, from local dangers to national threats. We need to understand how community based issues, such as crime, can become part of larger threats to our national security.

The legislation before us would create a department with just this kind of perspective, one that would see the bigger picture and take the longer view, one that would enable us to provide a seamless response to the dangers facing Canadians, from threats to their individual liberty to those which affect their communities and threaten the nation.

This department would have the flexibility to respond and coordinate across different categories of threats, ensuring the appropriate response at the appropriate time. Moreover, by integrating these diverse but closely related responsibilities, we would be able to identify gaps more quickly, respond more quickly and communicate more effectively.

In conclusion, for the very first time, security and intelligence, policing and enforcement, corrections and crime prevention, border services and border integrity, immigration enforcement and emergency management would be brought together under one single roof, led by one senior cabinet minister. We would have the capacity to develop a truly integrated and comprehensive approach to threats from whatever source. In a world of diverse dangers, Canadians demand no more and deserve no less. I urge all members to support this very important legislation.

[Committees of the House, November 5th, 2004]

Mr. Speaker, I have the honour to present, in both official languages, the first report of the Standing Committee on Environment and Sustainable Development.

In accordance with its order of reference of Tuesday, October 26, 2004, the committee has considered Bill C-7, an act to amend the Department of Canadian Heritage Act and the Parks Canada Agency Act and to make related amendments to other acts, and agreed on Thursday, November 4, 2004 to report it without amendment.

[The Environment, November 5th, 2004]

Mr. Speaker, this morning we learned that Russian President Vladimir Putin has signed a bill to ratify the Kyoto protocol.

Can the Minister of the Environment tell us his reaction to this action by the Russian president, which represents a crucial step for Russia and makes it possible for the protocol to take effect next year?