Larry Bagnell

[Income Tax Act, September 25th, 2003]

Madam Speaker, I think the member and I agree on virtually everything.

The first point was his chiding disappointment in my advertising. He may be disappointed but I can say I will not get a single call from my constituents in the Yukon who vote for me saying that they were disappointed that I said what a marvellous and beautiful part of Canada it is.

I agree with the member on competitiveness. I totally agree with him on the question of how we can pay for social programs, education and health care if we do not have a good economy. That is why this bill is headed in that direction. That is why we made the $100 billion tax cut, the largest in our history. It was to help competitiveness so that the jobs are in Canada and we can contribute to the things that are important to our nation.

The last question was why it was not in the 2000 budget when the other corporate tax was reduced and why it was put off for three years. I mentioned it in my speech but maybe I did not make it clear. The reason that this had to be negotiated longer is that there is the 25% resource allowance which did not make a lot of sense but somehow had to be removed in the very complicated tax scenario that I outlined.

This industry has a different set of deductions and rules. To sort it out with the industry there was extensive consultation to come up with the model.

I am sure we all would have preferred it earlier but I think by leaving it until later and getting the industry on side with its input was just as important and it will phase in to the betterment of us all.

[Income Tax Act, September 25th, 2003]

Mr. Speaker, I am delighted to stand today and speak to Bill C-48, an act to amend the Income Tax Act (natural resources).

When I heard last week that the bill would be coming forward I specifically asked to be on the speaking list because the bill will be good for my constituency and for resource extraction in Canada. As members know, the resource industry is part of our history and part of the foundation of our nation, and it certainly should be on a level playing field with other industries.

This is a very exciting bill. I was delighted that the member for Medicine Hat, who does economic analyses for the Alliance, was strongly supporting the bill. I quite enjoyed his analyses. I think it helps to show what a tremendous asset these improvements will be for Canada.

I want to speak briefly about my own constituency. As the House knows, the world's greatest gold rush in August 1896, which started the European economy, is part of our history in Yukon. It has been a resource based economy, to a large extent, for 100 years, resource based and tourism. At that time the world was in a great recession and the gold rush in Yukon actually helped pull Canada out of that recession. The resource industry has been very important in my riding's history.

If I have time left at the end of my speech, I will give a bit more of the history of my riding.

However I first want to talk about the broad overall aspects of the bill and the benefits that it would provide for the nation.

First, it certainly would help the investment climate in Canada, which I am sure we all appreciate. It would improve the international competitiveness of the resource extraction industry in Canada. A previous speaker mentioned that to some extent. It would help the development of Canada's resource base and, of course, Canada has a remarkably rich and precious resource base.

The other bases are people and the knowledge based economy. However, in concert with that, we have to continue what has always worked for us. It would be a shame if we were actually importing these resources from other countries when we are so wealthy in the first place, and not paying off the national debt but importing things we already have here if we did not set up a reasonable tax regime, which is what the bill intends to do.

The bill simplifies the taxation for the resource based oil, gas and mining. I will explain a little later how it is very complex at the moment and a little arbitrary. However the bill simplifies that, which is one of the reasons I think there is so much support for it.

We have been on a movement in the last three years to reduce taxation in Canada. In the year 2000 we reduced the corporate tax rate to help us be more competitive with the rest of the world, as outlined by the previous speaker. However at that time we did not reduce that tax on the resource based sector, that sector that is so important for my constituency and much of Canada, because they had a particular credit, which I will outline later, that did not allow the reduction in the main corporate tax base, as all the other industries in Canada had. Since that time there have been many calls from industry and Canadians to reduce that tax rate. Heeding those calls, we are proceeding with that today.

We did something else in this whole regime to improve our competitiveness. There used to be and still is partly a capital tax. That particular tax was a disincentive to business in the sense that if one owned anything, whether one made any money or not, one was taxed on it. If it were over $10 million one was taxed at .225%. That is a severe disincentive to investing in this great nation and therefore will be reduced from 2003 to 2008.

A half an hour ago I talked to people in the industry in my riding and they echoed some of what I am saying now. They wanted to make sure that anything that helps level the playing field between resource extraction, which is so important to my area in the north and the rural parts of Canada, and manufacturing is put in place, which is exactly what the bill would do. They made the point that mining, in particular, has huge upfront costs, maybe millions or even billions of dollars, for development, pre-development and exploration, that other industries do not have.

In the scheme, which I will outline in a minute, there are provisions such as the 10% tax credit on grassroots exploration and pre-production base. This only applies to base and precious metals and diamonds, so it will specifically help that aspect of the pre-development, which involves very expensive costs to this industry.

For those who are watching and who do not understand exactly what we are doing, I will try to explain it in a simple way, although it is a bit complex because there are a number of elements to the bill. I will try to outline it in a simplified way so that it is more understandable than it may be in some of documents people might have received.

In the main part of the bill we will be balancing the corporate tax for resource extraction businesses, like mining and oil and gas, to be comparable to other industries. If people live in a part of the country that has these types of industries, at the moment they are disadvantaged because in 2003 we reduced the corporate tax for businesses down to 21% but we left mining and oil and gas at 28%. Therefore, we will reduce that to level the playing field. This year it will 27%; next year it will be 26%; in 2005 it will be 25%; in 2006 it will be 23%; and in 2007 will be down to 21%, the same as the rest of industries in Canada.

Regarding the provision which I mentioned before, the reason we could not do it was because of an existing deductible, a 25% resource allowance, for mining, which helped. The problem with this deduction was it was a bit arbitrary. Other deductions came before and after that so companies would have to try to figure out their business plans when they invested to get the best deductions. It was a arbitrary because it was based upon income. That deduction did not make a lot of sense nor was there a lot of fairness to it. Therefore, we are removing that deduction to balance this off. In 2003 they will only get 90% of that; in 2005 it will be 75%; in 2005 it will be 65%; in 2006 it will be 35%; and then in 2007 that deduction will no longer exist.

There is also more good news for our industries in this respect because the industries also pay royalties to the Crown, the Crown being primarily the provinces and the territories, or they pay something similar called a mining tax. Once again this is a cost of doing business for mining and oil and gas and it can make them less competitive. Therefore, we will give them a deduction for that in the new regime. That will start out this year. As I said, everything is phased in to try to moderate the effects of this bill on industry and on Canada so there is no big disruption. The first year it will be 10%. The second year they will be allowed to deduct 25% of that; in 2005 it will be 35%; in 2006 it will be 65%; and in 2007 it will be the whole 100% of all those costs.

Finally, there is another tremendous credit for the industry. That is a 10% tax credit on grassroots exploration and pre-production base. This is only for base metals, precious metals and diamonds. Of course there are tremendous upfront costs in the beginning with no return. If we want development in Canada, someone has to invest and put down the risk of that, and this tax credit will assist that.

When we add all these complicated provisions together, most of which are in favour of the industry, what is the result for a particular mining or oil company? In general, in the vast majority of the cases, they will be better off. If they do new exploration in Canada, which is what we are trying to promote in the development of the sector in a reasonable, environmentally sensitive way, then they will be better off with these provisions.

If there is critique of this, the odd company may have made its discoveries long ago and it is carrying on with its investments at the status quo, collecting its royalties. In those situations they are less well off, but in general the Government of Canada will make a substantial contribution on balance to help this industry, which is just fine by me because it is a major industry in my riding.

The bottom line in this is a great news story for Canada. The previous speaker talked about the United States and competitiveness. I will give hon. members some sample figures to see how it helps us with our closest and main competitor in this industry.

I will give a couple of examples. Other figures are available, but these are the statutory tax rates for these corporations. The tax rate for oil and gas in Alaska is 41%, in Texas it is 35% while in Canada it is 42.1%, which makes us less competitive. Our taxes are a tad higher than Alaska and quite a bit higher than Texas. After the bill comes into effect, our taxes will be 30.1%, which is far more competitive than either of those areas.

In the mining sector the Nevada statutory rate is 35% while Canada's rate is 41.1%. Once again we are at a slight competitive disadvantage. After the bill comes into effect, ours will be 30.1%, which is a great competitive advantage for Canada. I hope we will see the results of this in the coming years.

My riding desperately needs development and in other northern parts of Canada it is sometimes very hard to find jobs for rural Canadians. They live in some of the most beautiful parts of Canada and would like to stay there. This will be a great advantage to them.

If I had time I would give hon. members a brief history of the resource extraction in my community, in my riding, which is the entire Yukon Territory, just so they would know how important this might be for my riding.

For 100 years, it has existed in the modern, European type of economic existence. Of course first nations people have been living there for thousands of years, doing quite well, preserving the environment in a great way and living responsibly off the land. In the European type of economy, which has existed for the last 100 years, there have been two industries. One of course is tourism, which explores the beauty of Yukon. It is one of the most beautiful spots in the world and I hope all hon. members will come to visit. To date the tourism industry has been weighted to the summer months, although we have some beautiful dog sled tours, skiing, hiking and events in the winter, but there are not as many tourists in the winter.

Mining has also been the greatest producer of the gross territorial product over the 100 years. We have had a wealth of mineral resources with over 50,000 claims in Yukon. Of course, they are under strict regulations to be mined responsibly with environmental sensitivity. In a way that is why I take some offence to other countries because some of them do not have the things that we accept as necessary in Canada, which may be some of the reasons why companies go there. However under this regime, they will not go to the United States because of a lack of tax competitiveness.

After the gold rush, the gold resourced in Yukon was by placer mining. This type of gold is found in the stream beds. It is fine, like sand almost. Then a few nuggets, such as on my Yukon pin, are found below the bottoms of streams, right on the bedrock level. Placer mining still exists today in British Columbia and Yukon. It is a great boon to our economy because one simply washes sand to get the gold out and it is an easily saleable commodity.

Over those years a lot of other base metals have been found. Precious metals, silver and gold, have been found. Not long after the gold rush started, a silver mine area was established near the great towns of Keno Hill, Elsa and north of Mayo. The mines have been there pretty well since the gold rush. I believe those claims are up for sale now, so if people would like to invest in a silver mine and come north, I hope they will look at those opportunities.

We also had one of the world's largest zinc mines in the great town of Faro. In fact I think it was the largest open pit lead zinc mine in the world. Unfortunately, it ran out of the highest grade part of its ore, but there have been others like Kudz Ze Kayah and other lead zinc deposits. There are a lot of undeveloped deposits still that could help lead to jobs. In turn that would provide revenues to Canada which could then be put it into health care, education and all the other things that governments need to do.

There was also a copper mine right within the city boundary of the city of Whitehorse. We just recently started a tiny hobby train, Miles Canyon railway train, to go around and show the history of the copper mines and the mining belt in the area.

We have oil and gas in the area. We have some capped gas at a place called Eagle Plains, which is up near the Arctic circle. We have no pipeline to get that out yet so there is not as much development as one might think, but we are working on that as well. Also gas in the southeast part of the Yukon near the Kotaneelee Field is already being shipped through existing pipelines. Of course, we have a forest industry in Yukon which is a resource development, but it is certainly not as big as mining.

I was outlining this not only, as my colleague said, as part of a commercial so members will all come to our beautiful part of the country to work in mining and to enjoy the spectacular tourism, but also to show how important this bill is to our people. We have the second highest unemployment rate in Canada at the moment and this type of fairness would be exceptionally helpful to our industry.

I want to close by reacting to a comment that the previous speaker made about Canada's standard of living. I do not think standard of living is totally based on a corporate tax rate. Standard of living is based on all the things that are important whether it is health care, family or community. I think most people would agree that we measure the greatness of a nation by how it deals with those most in need.

The United Nations has measured Canada for the last years as among the top several nations in the world. I do not think we have much for which to apologize. This will help our industry, an important part of our history. However in the long run what we choose in values are things that are not only environmentally sound, or part of the modern new economy, or on the leading edge of knowledge and technology. Rather we will make the choices that provide for the poor, the weak, the lonely, the hungry and for our diverse country. That way we will continue to build this great nation, and this bill will help immeasurably.

[Supply, September 23rd, 2003]

Mr. Speaker, I wonder if the hon. member could let us know some of the feedback on the government's work from agricultural organizations or those involved in agriculture.

[Supply, September 16th, 2003]

Mr. Speaker, I thank the hon. member and agree with much he said. I agree that there is no right and wrong in this issue and that there is not a riding in this country where there are not people on both sides of this very passionately felt issue.

In that respect, as a member I am very proud of Canadians, this Parliament and my constituents for the civility with which they have had this debate. They are thinking of the rights of others. They are tolerant of others and other points of view and are having a very reasonable debate.

I want to go on the record as saying that my constituents, like everyone else in the country, are very split on this. There are very passionate feelings on both sides of this issue. I, like the hon. member, would like a solution that unites the country rather than divides it, as it seems it is today. I am glad the member believes there are minds that can come up with that solution, one which would unite Canadians, not divide them.

I would like to ask the hon. member about one possible solution he has proposed in regard to a civil union. My sense is that it might backfire. People who would still want to be married and to use the term marriage might then challenge the churches in the courts. The churches might then lose that challenge. I think there would be chaos in the country if we tried to force various religions to do something they would not want to do. One of the aspects of the bill is to protect religious freedom as well as equality of access.

[Criminal Code, September 15th, 2003]

Mr. Speaker, I would like to thank the hon. member for her question and address a number of points. First, there should be great credit to the families and steelworkers which I stated in my opening remarks. I also pointed out that we should seriously consider the improvements to the bill that have been suggested in the early parts of this debate. I am not disagreeing with her that the committee should look at all possible amendments to the bill.

I have met with the friends of Westray over the years and provided my support for their efforts. That is very important. One of the problems in this case was that one of the Crown's major witnesses changed his testimony. Regardless of what bill is in place, I am not sure how that particular problem would be solved.

The member is correct in suggesting that the bill arose out of Westray, but it has much more far-reaching ramifications than just the Westray case. Hopefully it would solve cases similar to that with any improvements that are put in and I am anxious to look at those improvements. But the bill is far wider reaching in that it would deal with every corporation in Canada and with anyone who works for any corporation at the operational level who is directing other people to do something that may be unsafe. There are far-reaching items in the bill and many things which are innovative and that will hold to task people who direct people to do unsafe things.

I would not suggest rushing the bill through just to say that someone has done it, but I would suggest getting it through quickly so that all these excellent provisions could be put in place to protect the safety of Canadian workers.

[Criminal Code, September 15th, 2003]

Mr. Speaker, I would like to thank the member for the question. I do not think it matters who raised this important issue. He suggests it was raised by the opposition, but I think it has considerable support by all members in the House from what I have heard so far in the debate.

It will take the support of all members in the House to have it go through expeditiously. As we know, usually when a bill is being slowed down it is quite often one of the opposition parties, even though several others may be on side. However, from what I have heard today everyone seems to be in strong support of this and we should be looking to the future to get the bill through as quickly as possible and also to consider suggested improvements that various people have put forward in the early part of this debate but to do all of that quickly so that we get the main components of the bill in place.

Everyone seems to be in favour of it because of its protection of workers and its efforts to reduce the inappropriate activity of anyone at any level in a corporation who directs people to do something that is unsafe.

[Criminal Code, September 15th, 2003]

Mr. Speaker, welcome back. I am delighted to be standing here to give a speech on a second piece of legislation today. It shows that we have a lot of legislation to cover this fall and a lot of work to do and that a lot of important things are being done to help Canadians.

I would also like to add a special welcome to the member for Dauphin—Swan River, who is a tremendous contributor to the House and who has been away for some time. We are all very happy to see him back.

Of course I also want to, as other speakers have, pay tribute to the families and friends not only of Westray but of other organizations where accidents have deprived families of their loved ones, and to the people who have worked toward improving the legislation, such as the friends of Westray and the steelworkers and all those who have contributed to getting to this stage with Bill C-45, the Westray bill, to address corporate responsibility for workers' safety.

I also want to thank many ministers and members of Parliament who came to my riding this summer to see the various problems and issues there first-hand. I think it is very important to Yukoners that so many saw these issues. They look forward to progress on such issues as placer mining. There was a problem, but now we are making progress on it.

Talking about mining, it has been the mainstay of the Yukon for the last hundred years, and while the bill of course does not deal only with mining, mining is a very important and special type of corporate entity. Often it is based around one mineral find and one property, and then the corporation dissolves thereafter. A way is needed to ensure that the corporation maintains safety in the perhaps short time it is in existence through the life of an ore body and that individuals responsible for unsafe actions are held to account.

In response to the standing committee's report, the government stated that the principles of sentencing in the Criminal Code should provide more guidance to the courts when imposing sentences on corporations. However, the government did not indicate its support for any particular changes. Indeed, it expressed concern as to the relationship between the criminal law and regulation and whether a form of community service order could result in managers who were culpable requiring their subordinates to do the actual community service work.

I am pleased to see that in Bill C-45 the government has gone beyond these concerns and has developed very substantive provisions that should result in much more effective and indeed creative sentencing of corporations.

The bill proposes three major changes. First, section 718.21 would provide the courts with what amounts to a checklist of 10 things that should be considered in setting the level of a fine. Second, proposed section 732.1 would open the way for the courts to take a supervisory role in rehabilitating a corporation. Finally, that section also points to the possibility of shaming the corporation.

Canadian law does not provide a mechanical process whereby the punishment is predetermined. Judges have a great deal of latitude to craft the appropriate sentence. I suspect that often judges find sentencing the most difficult part of their job. The guilt of the accused is often pretty clear. Indeed, often the accused pleads guilty and the only real question is what sentence to impose.

Courts are often criticized by the media and the public for the sentences they impose, but I believe that is the inevitable result of giving them the latitude we have. Neither the reporter nor the members of the public who read or hear the media report have to fashion a sentence that reflects the six, and sometimes competing, purposes of sentencing set out in section 718.

When a court has before it an individual who has pleaded guilty to a serious offence, who has expressed remorse, who claims to be dealing with his or her alcohol problems, and who has a family to support, the decision whether to emphasize denunciation and deterrence, perhaps at the expense of assisting the offender to rehabilitate himself, must be very difficult.

The task is no less difficult when a corporation is convicted. Of course, a corporation cannot be imprisoned and so fines are virtually the exclusive way of punishing a corporation. Even that is not without difficulty, since the individuals who actually committed the unlawful act and had the necessary criminal intent will not bear the cost of the fine. It will be borne by the investors and shareholders who are quite likely totally innocent.

Moreover, the corporation may have been transformed between the time of the commission of the crime and the imposition of the sentence. All the managers and employees involved may, for example, have been fired.

There is no way to ensure a perfect result. This does not mean that we should do nothing. Parliament should at least indicate to the courts the factors that they should consider when an organization has to be sentenced. The factors found in proposed section 718.21 are intended to reflect for corporations the factors that govern sentencing of individuals. Judges probably already apply many of these factors, but providing a list should result in judges having a more complete picture of the corporation. I believe that members will agree that the factors are comprehensive and appropriate. They are as follows:

First, the economic advantage gained by committing the crime. Clearly, the more money the corporation made the higher the fine should be.

Second, the degree of planning involved. Careful planning shows a deliberate breaking of the law and should be punished more than a case where the senior officers took advantage of an unexpected opportunity to make a quick, illegal profit.

Third, the need to keep the corporation running and preserve employment. Just as individuals should not be fined so heavily that they will not be able to provide for their families, so a corporation should not normally be bankrupted by a fine so its employees are thrown out of work.

Fourth, the cost related to an investigation and prosecution. Many corporate fraud offences require lengthy investigations and the cost to the public of detecting the crime and building a case should be considered by the judge.

Fifth, any regulatory penalties imposed on the corporation for the offence. Courts consider whether individuals have been punished in other ways, for example, by losing their jobs. Similarly, a court should consider whether the public interest is served by adding a large fine to the penalties that may have been imposed on the corporation by a body such as a securities commission or any other regulatory body.

Sixth, penalties imposed on managers and employees for their role in the crime. A court should consider whether a corporation has disciplined or even fired employees who participated in the offence. Doing so sends a powerful message to other potential wrongdoers in the corporation. Individuals who plays a role in breaking the law risk ending their career even if criminal prosecution is avoided.

Seventh, noting whether there have been previous convictions or regulatory offences. Just as the criminal record of an individual is very important to determining the appropriate penalty, so it is important for a judge to consider whether the corporation and its workers had been sanctioned for similar activities in the past, not just in the criminal courts but by regulators like occupational health and safety departments.

Eighth, restitution, which has been mentioned by other speakers today. Compensating victims shows that the corporation is trying to make up for the harm that it caused.

Ninth, attempts to hide assets to avoid paying a fine. A corporation that tries to pretend it is poor, rather than being open with the court about its financial situation, is showing that it has not changed its ways.

Tenth, measures taken to reduce the likelihood of further criminal activity. New policies and practices, like spot audits or changes in personnel, could indicate that the corporation has learned its lesson.

After considering all these factors, a court should have as complete a picture of the corporation's situation as it has of an individual's circumstances when it receives a pre-sentence report. Indeed, the factors may encourage the Crown and defence counsel to give serious thought to what is an appropriate fine leading to a joint recommendation. There is nothing wrong with negotiations on the level of the fine to be paid, provided everyone has considered the appropriate factors.

Although the factors are important, a potentially more effective tool for rehabilitating the offender and protecting the public from further crimes is the possibility of putting a corporation on probation. Courts often place individual offenders on probation. The court imposes conditions that allow the offender to deal with the underlying problems like substance abuse.

Probation is virtually unheard of for corporate offenders, but there may be circumstances in which probation would be appropriate to ensure that the corporation would take steps to reduce the chances it would commit further crimes .

The bill proposes to put into the code a specific section dealing with probation orders for corporations. The list of conditions the judge can impose begins with providing restitution to the victims of the offence, to emphasize that their losses should be uppermost in the sentencing judge's mind. But it then sets out conditions that may be imposed by the court to supervise the efforts of the corporation to ensure that it does not commit crimes in the future.

A court order can order a corporation to implement policies and procedures to reduce the likelihood of further criminal activity, to communicate those policies and procedures to employees, to name a senior officer to oversee their implementation, and to report on progress.

In its response, the government expressed a concern about the potential overlap of probation under criminal law and regulation, and that is an appropriate concern. It is noteworthy that Bill C-45 would require the court to consider whether another body would be more suitable to supervise the corporation. There is no need for the court to get involved in overseeing changes in a corporation's safety practices, for example, if a territorial or provincial occupational health and safety department is already doing so. Such an agency has trained inspectors and expertise that the courts lack.

Finally, the bill would give the court the power to require the corporate offender to inform the public of the offence, the sentence imposed, and the remedial measures being undertaken by the corporation.

Cheryl Edwards in her article on Bill C-45 in the August 22 edition of Lawyers Weekly called this possibility the most interesting of the proposed creative sentencing options. She wrote:

Imagine a court directing the posting of a criminal conviction and sentence prominently on a corporate website, in a corporate annual report, or in the news media. For many organizations the resulting profound impact on public relations and public image would far outweigh any monetary penalty.

I ask members to consider how a CEO would explain to the board of directors or to the annual general meeting of the shareholders having to run full page ads in the major dailies across Canada telling everyone that the corporation was guilty of serious fraud or killing its workers through criminal negligence? Surely the very possibility would be an incentive for the corporation to review its policies and procedures now to avoid the possibility of such embarrassment in the future.

These innovative proposals should be supported by all members. Therefore, I hope for the families and friends of future workers and for the safety of Canadians that we adopt Bill C-45 as quickly as possible before the House prorogues.

[Parliament of Canada Act, September 15th, 2003]

Mr. Speaker, it is great to be back to make a couple of speeches on the first day of the autumn session of Parliament. I would like to welcome everyone, especially the new pages. I would like to assure my constituents in Yukon that the new pages have already completed the most important part of their training and fully understand that Yukon is the best constituency in the country.

Before I go into details on the amendment to Bill C-34, the previous speaker discussed the general legislative climate this fall. I would like to follow up on that because it is a very aggressive and detailed legislative agenda and I hope people do not lose track of that.

There are many bills that we are in the midst of bringing forward and must continue with such as, Bill C-34, which we are talking about now; but also Bill C-13, assisted human reproduction; C-22, family law; C-38, marijuana; Bill C-45, which I hope to talk about later today concerning the Westray bill for worker safety; Bill C-46, market fraud; Bill C-19, resource taxation; Bill C-6, first nations specific claims resolution for the economic development of first nations; archives legislation; bills related to child pornography and the sex offenders registry; citizenship; as well as urgent veteran's needs.

And then of course all the committees are working. The finance committee will be doing its pre-budget work. There are always important issues in foreign affairs. The health committee has to work on the West Nile virus and the agriculture committee on mad cow disease.

This is a very detailed agenda and continues to be one of the most productive legislative agendas we must get through. I hope people do not get sidetracked in the House or in the media about other things or go off these important changes that affect real people in Canada.

I am pleased to address the NDP amendment at report stage with respect to Bill C-34, a bill which would establish an independent ethics commissioner reporting to Parliament. The amendment proposes the deletion of clause 38 of the bill in its entirety.

This clause would change subsection 2(2) of the Federal Courts Act by adding references to both the ethics commissioner and Senate ethics officer so that the activities of the ethics commissioner and Senate ethics officer are not subject to review by the Federal Court, whether by judicial review or by appeal.

The Parliamentary Secretary to the Government House Leader has already explained why the NDP amendment is inappropriate and should be rejected. I want to comment on the need to preserve the House's privileges in this area.

The House and its members have traditionally been responsible for their ethical conduct. This is a tradition we in the House have had since Confederation and which we share with other parliamentary democracies.

Let me set out how the bill preserves this tradition of parliamentary privilege and ensures the House's accountability to Canadians.

Clause 38 amends a provision in the Federal Courts Act which itself exists for greater certainty to ensure that the activities of Parliament and parliamentarians are excluded from review by the Federal Court. Given the role of the ethics commissioner and the Senate ethics officer in dealing with the conduct of parliamentarians, it is logical that those provisions be extended to these two officers of Parliament.

This clause is but one of several provisions in the bill intended to ensure that the House, and not the courts, continues to have the ultimate responsibility, and accountability, for the ethical conduct of its members. For instance, the bill would create an ethics commissioner as an officer of the House.

Section 72.05 includes express recognition that the ethics commissioner “enjoys the privileges and immunities of the House of Commons and its members in carrying out his or her duties and functions”. This section also provides express recognition that the bill does not in any way limit the powers, privileges, rights or immunities of the House or of its members.

Further, Section 72.12 would ensure that the ethics commissioner and his or her staff could not be taken to court in respect to their official activities. This section also acknowledges that the commissioner and his or her office are protected by the privileges and immunities accorded to Parliament as an institution. Similar provisions have been made for the Senate ethics officer throughout the bill.

Collectively, these provisions, including clause 38, are essential if we are to create an ethics commissioner who, in respect of matters pertaining to members of the House, is to function as the legislation requires and is accountable to the House.

In this regard, the bill states that the ethics commissioner's functions in relation to members would be carried out “under the general direction of any committee of the House of Commons that may be designated or established by the House for that purpose”.

Canadians expect members of the House to establish and abide by ethical rules. This is only proper because as parliamentarians we are ultimately accountable to the public, both for our own ethical behaviour and for the steps taken by the ethics commissioner as an officer of Parliament.

In our view, the proposed amendment would seriously undermine Parliament's long standing privileges, the ability of the House to properly assign duties and functions to the ethics commissioner, and the House's ultimately accountability for the ethical conduct of its members.

It would undermine the ability of the House to govern its affairs and would open up the possibility that the courts might be called upon to second guess or review the actions of the ethics commissioner.

Canadians have every right to expect that the House would create and enforce the highest ethical guidelines for members. They know and expect that the House and its members are ultimately accountable for the ethical code it will implement. They do not want parliamentarians to transfer this responsibility to the courts. Accordingly, I would encourage members of the House not to support the amendment.

I want to conclude by again referencing the previous speaker's speech when he commented on the tremendous potential leadership awaiting in the wings for the country and how popular that is with Canadians. We will have a great transition to even more exciting times, but as I was saying at the beginning of my speech I hope that the important things that affect the lives of Canadians, which I mentioned and the number of bills that we will be dealing with throughout the fall, winter and spring, would not be lost in the simple transition of politics.

[Main Estimates 2003-04, June 12th, 2003]

Mr. Speaker, I am delighted to talk about railways this evening.

I voted for the extra $9 million for VIA in committee, as it was in the original estimates, and I will be voting for it again. My reasons are simple. First, it is for capital upgrades, new cars, and for fixing up the stations. I am a big fan of the railroads and we have been playing catch up with the quality of the railroads in Europe and Japan for many years. We are doing a very good job and I want that to continue.

That could have been the end of my speech but I have nine and a half minutes left, so I will use the rest of the time to demonstrate seven principles which I believe should be followed in legislation in Parliament. I will then finish off with a very exciting rail project.

In a situation like this there are seven principles that should be followed. I am glad I have an attentive audience in the far corner that wants to hear these seven principles.

First, a number of things have nothing to do with leadership. There are all sorts of people in the House who in their shenanigans attribute everything to leadership and potential leadership. This is no exception. There are people outside the House doing that too. It does not make any sense. There are three candidates running for leadership and never once has any of the three candidates suggested to me what their position is on something or what the position is that I should take. I have already explained the position I took on this and why, and it is totally different from that of other representatives who have the same leadership favourite. It is just fantasy speculation and it should be cleared up because it is going to go on for another six months.

The second principle is that the government in general should avoid competition and subsidizing competition to private business. I think the member for Kootenay—Boundary—Okanagan made this point very well. Where that actually is the case, I agree.

Principle number three is that spending should be responsible. In the first vote we had on this, some members voted against the increase, and although I did not, I support what they did. They did what they felt they had to, and should do, because they were trying to be responsible based on the information they had at the time. They did not feel they had sufficient information to justify the added expense. They did not feel that the questions had been answered sufficiently. Based on that, as they were going to make a responsible decision on expenditure of money, they did what they felt they should do. That is perfectly reasonable because all parliamentarians should be responsible in the expenditure of money.

Principle number four is that committees should have some effect on whatever they are dealing with or they should not be tasked with dealing with it. People's time should not be wasted if they are going to be asked to do something and then it is ignored. For instance, if committees are going to look at estimates and have some valid input, then that input should be taken into account and should have some effect.

In this particular case it had an effect. The department and the minister, to his credit, realized that they did not have the information and that was the reason people voted against it. In a very unusual situation he came back to committee, not once but twice, to explain things, to give more information to committee members which they needed before they could make their decision.

Principle number five is witnesses, especially those who are responsible for expenditure of government funds, should have that information with them to answer the questions. If they do not have it themselves they should have the people with them who can answer those questions.

Principle number six is that when estimates are brought forward, obviously they have been developed with great thought and detail by experts in the crown corporation or the government department. That has to be respected and a very careful analysis has to be carried out before they are changed.

If something is going to be cut, the last principle is not to ask for a cut without asking what effect it will have. I do not want members of any committee I am on to ask for something to be cut without asking what the ramifications will be to that particular operation, to the government or the people involved. We have to know what effect a cut is going to have.

In summary of the process here, a number of committee members, not myself but other members, felt they did not have enough information and they suggested a cut. The minister came back and explained what the money was for, certainly to my satisfaction. The government had no choice but to bring in the option, as in the vote tonight, for people to vote to reinstate that amount. This is the only mechanism that could be used. Therefore, those committee members who are now convinced by the new information they have heard have a choice to make that vote.

Finally, in my riding there is a very exciting railway, the White Pass, that has been there since the gold rush. Riding on the narrow gauge is probably the most exciting trip in Canada and I hope everyone will take the trip up through the mountains.

Also on this topic, I mentioned in committee that there is a railway in Alaska and a railway in Canada that goes to northern B.C. and there is an opportunity to join the two railways. This probably would be the most exciting project in North America since Confederation. The minister says we have to dream dreams in this area and I hope I can have the support of the whole House for $6 million for a feasibility study for such a project.

[Supply, June 12th, 2003]

Madam Speaker, I would just like the member, with whom I debate all the time in the industry committee, to tell me that he believes it is better to transfer the money to the province of Quebec for the municipalities than for us to give it directly in the agreements we have now.

In the previous decade, time and time again the Government of Quebec downloaded items on to the municipalities so that their water, sewer and roads fell below standards. It stopped that and actually asked the municipalities to put up money instead of getting grants from the province. In 2000 it stopped taking money from the municipalities but it stopped paying its grants in lieu on utilities of about $400 million. So it was $386 million over three years and then $400 million thereafter.

If this is the type of treatment the municipalities would get from the province, why would we transfer the money to the province then to the municipality and not directly to the municipalities through the infrastructure program, which is what we are doing right now?