Mr. Speaker, it is my pleasure to speak on behalf of the Bloc Québécois today about Bill C-44, An Act to amend the Canada Post Corporation Act.
I would like to begin by saying that the Bloc Québécois will vote against Bill C-44. This bill is the same as Bill C-14, which was introduced in May 2008. This bill would amend the Canada Post Corporation Act, abolishing Canada Post's exclusive privilege to handle outgoing international mail.
We think that taking away Canada Post's “exclusive privilege” would jeopardize its revenues and have other negative repercussions, such as the reorganization of rural mail delivery and job losses.
As a first step toward deregulating outgoing international mail, the introduction of Bill C-44 erases any doubt about the Conservative government's intention to completely privatize Canada Post.
The Bloc Québécois strongly opposes the privatization of Canada Post to any degree. The crown corporation must remain a public concern in order to maintain universal services and consistent rates throughout Canada and Quebec.
We should take a look at how the situation has evolved. On April 14, 1981, the House of Commons passed the Canada Post Corporation Act to turn the postal service from a department into a crown corporation. For the government of the day, a complete overhaul of the Canadian postal administration had become necessary because of the steady deterioration in the quality of service during the decades preceding the legislation. Serious disputes between the department and its employees, which led to a number of strikes that brought postal service to a standstill, were among the factors that contributed to the decline in the quality of service.
In a context that favoured the organization of public service workers in the 1970s, the postal workers' union waged an intense struggle for better working conditions in an environment that was being transformed by the mechanization and automation of mail processing. Administration of the department was made more complex by factors such as worker demands, a serious annual deficit that climbed to $600 million in 1981, and an increasingly competitive market.
The federal government’s top priority was to give the new postal administration the autonomy required to develop business objectives that would make postal services self sufficient in Canada, and also improve labour relations and service. The new crown corporation was given the “exclusive privilege” of collecting and delivering letters in Canada. The monopoly provides it with a guaranteed source of revenue that allows it to deliver mail to everyone, no matter where they live in a country, at affordable rates. In other words, it allows Canada Post to use the money it makes in high-density areas to provide service in non-profitable low-density areas. This practice is known as cross-subsidization. That is important.
In addition, among the changes that made it possible to achieve these new business objectives were the franchising of postal outlets, the privatization of other services, rate increases, the closure of post offices, especially in rural areas, technology development and use, and the penetration of new markets such as the acquisition of Purolator in 1993. As a result, in 1989 Canada Post made its first profit since 1957.
Today, Canada Post collects, processes and delivers over 11 billion pieces of mail a year throughout Canada, and between Canada and more than 200 postal administrations around the world. It serves approximately 14 million urban and rural addresses in Canada. Canada Post's products and services are sold through a network of some 23,000 retail outlets. It counts itself among the largest corporations in Canada in terms of gross revenue and is the sixth largest employer in Canada.
Canada Post Corporation, which is responsible for traditional postal operations, is the principal component of the Canada Post Group, which also includes Purolator Courier Ltd., epost, Innovapost, Progistix Solutions Inc. and Intelcom Courrier Canada Inc.
The Canada Post Corporation, which handles traditional postal activities, is the main component of the Canada Post Group, as I said earlier. In addition, the Canada Post Group remains profitable today, although its consolidated net profit after tax was $90 million for the year ending December 31, 2008. I would remind the House that the Canada Post Corporation has been subject to federal income tax since 1994. It also pays provincial tax and large corporation tax.
In addition to paying tax to its shareholder, the Canada Post Corporation pays it a dividend. Based on its financial performance in the previous year, Canada Post declared and paid $80 million in dividends to the Government of Canada in 2006. In 2007, it paid $48 million in dividends, and in 2008, $22 million. We can see that, with time, Canada Post is becoming less profitable and paying out less in dividends to the government.
What remailers do is collect bulk mail from business customers in one country and send it to another country with lower postal rates, where the mail is sorted and then remailed to a third country.
For example, a Canadian company that wants to send mail to the United Kingdom can deal with a remailer. The company sends the bulk mail to a post office in another country, where it will be sorted for a fraction of the price, then remailed to the United Kingdom.
Remailers have been working in Canada for over 20 years. In 2006, it was estimated that there were between 5 and 7 remailers in the country. The largest are Spring Global Mail, Key Mail and DHL Global Mail. They use the services of some Canadian industries and do $150 million in business.
It is important to understand the dispute between the Canada Post Corporation and remailers. Canada Post states the following:
For the last 10 to 15 years, several companies, some of which are surrogates of postal administrations abroad, have been collecting lettermail in Canada and bringing it to other countries where it is processed and remailed to other countries. Under section 14 of the Canada Post Corporation Act, Canada Post has the exclusive privilege of collecting, transmitting and delivering letters in Canada.
Canada Post initiated court action against several of these remailers. Through actions and appeals the matter was put before several courts. In all instances, the courts confirmed Canada Post’s interpretation of the Act.
For several years, Canada Post tried to resolve this issue diplomatically via the Universal Postal Union, of which most postal administrations are members, as well as through direct negotiations with violating remailers. When this did not effect compliance with the law, Canada Post reluctantly resorted to litigation.
I emphasize the word “reluctantly” because it is important. The Standing Committee on Transport, Infrastructure and Communities, on which I sit, brought in Canada Post and the remailers. The first recommendation in our first report indicated that we wanted the jobs in these companies to be retained. That was the goal. It is important since Canada Post told us in its statement that it tried several times, through the Universal Postal Union, to negotiate with these companies.
It is important because in his speech on October 7, 2009, in the House, the Minister of State responsible for Canada Post, among other things, said:
There are two kinds of outboard international remails. [...] First, a piece of mail going to another country can go to a country with a lower regime cost.
...that is one way that it can and would be allowed. This actually goes back to the ratification of the 1999 Beijing congress on the Universal Postal Union. That is one way that it can be done.
There are two methods and one of the methods is legal and that is what everyone has always focused on. When we talk about $150 million worth of business in 2006, that figure has surely gone up since then. It was difficult for us to get the exact figures. When Canada Post says it is losing between $60 million and $80 million, that means that the remailers are still in business.
With that in mind, the Standing Committee on Transport, Infrastructure and Communities, responsible for examining crown corporations, looked at this issue. Our recommendation pointed out that since one way of operating is allowed by law, there is no need to change the law to allow these businesses to continue remailing under international agreements. Canada Post used the international platform and went to arbitration through the Universal Postal Union.
The Conservatives have not understood one thing: private corporations have a bad habit of not being all about service. They are there above all to make money. In recent years, they have launched huge operations with major public institutions such as universities and Quebec CEGEPs, by signing contracts with these universities. They were in the process of taking over Canada Post's market piece by piece.
I understand the decision of the President and board of directors of Canada Post. At some point they decided that enough was enough. Under the law, they have the right to do certain things—I read to the House the text delivered on October 7 by the minister responsible—but there are other things that they do not have the right to do and they have been told to stop. When I met with these companies' lobbyists, I told them to stop always wanting to expand. They are targeting Canada Post revenues, leading to their decline. What does that mean? It means that the government is considering privatization. The president of Canada Post, Moya Green, was hired at the time by the Liberals. We cannot ignore the fact that the president's stated goal, which is now gaining increasing support from the Conservatives, was to make Canada Post attractive for privatization.
That is clearly the goal, despite what many departmental documents say. An election is on the horizon, and they do not want to scare people. It is clear when we see the work that was assigned by the former minister, the member for Pontiac. He wanted a report that would open a crack in the exclusive privilege. In fact, by attacking the exclusive privilege and allowing companies to collect mail and send it overseas, the Conservatives are now opening up that crack. This will probably permit companies to collect all the mail from a major organization and process it abroad—and maybe even send it back here. Once the exclusive privilege has been breached and a company can take mail to be processed abroad, that does not mean that no letters will come back. What will happen then? It will end up before the courts. Canada Post will come in second, and will be forced to prove that the mail that was collected was intended for us, and that will not be easy.
That is what the Conservatives want. They want to open a crack in the exclusive privilege. Canada Post's profits are dwindling, but what matters to us, to Bloc Québécois members, is that services must be maintained throughout Quebec at the same rate. That is our objective. We know that the hidden agenda of the Conservatives is to open things up to competition. Once again, they are making speeches and haranguing us to tell us to open up to competition.
Rural areas in Quebec will never be able to compete with urban areas. How far will the Conservatives' need for competition go? I think it will never end, no matter what they may tell us today.
They released their latest report because there was a threat of election. They decided to sweep some of their ideas under the rug to hide them. We are not fooled. We hear them, we are listening. I listen to the minister's colleagues in committee. We know that they want privatization.
We will always be there to prevent privatization, especially when Canada Post services are currently under attack.
The government's report even makes it possible for services to be provided in a different way once postmasters retire.
The government sees it like this: they can close post offices and provide services at postal outlets, which are often located in shops or convenience stores.
My colleague from Drummond went through a difficult situation this week. What are Canada Post and the Conservative government doing to obtain the public's consent? They offer more services to a community. The postmaster retires. They could replace him, but what they really want to do is contract the services out to a private outlet located in a shop that is open for longer hours than the post office.
However, what happened with my colleague from Drummond was that it came to light that a contract had been signed with a convenience store owner, and the contract was due to expire in 2010. Then Canada Post decided to impose new advertising standards. Lacking the means to do what the crown corporation wanted him to do, the operator could no longer provide the service. Canada Post therefore closed that outlet and opened another four or five kilometres away, and then some 5,000 people had to drive their cars to pick up their mail. That is what happened.
Clearly, Moya Greene, the corporation's president, will have achieved her objective. She wants to close service centres, because she thinks there are too many and they are too expensive. Of course people will have to travel to get their mail and that is what we will do. They are choosing to do something indirectly that they refuse to openly admit. The fact that the Conservatives are supporting Canada Post's actions just shows their hypocrisy.
Bill C-44 is therefore a way to create a crack in Canada Post's exclusive privilege of collecting the mail. There is a reason I gave a little background information, because that exclusive privilege was granted to Canada Post. Before becoming a crown corporation, with the government as its major shareholder, it reported directly to the government. Now it is a crown corporation. As I said earlier, it pays federal and provincial income tax, as well as corporate income tax. It has a board of directors and acts more or less autonomously. It would not take much to be able to privatize it.
Of course as long as it is generating income for the government, things are fine. However, the problem is that the Conservative government is beginning to realize that the way things are going, profits will continue to dwindle. So naturally, there is tremendous temptation. The temptation to privatize began with the Liberals and continues with the Conservatives. Of course, as soon as a private corporation takes over, it will be like what happened with Air Canada. Since Air Canada's privatization, no one can say that the service has remained the same throughout Canada as it was when it was the government's responsibility or when it was a crown corporation. They want us to forget that.
When it comes to service in French, we all know that Air Canada receives more complaints than any other. It is legally obliged to provide service in both official languages. Yet that company is the subject of the greatest number of complaints to the Commissioner of Official Languages, because it does not provide the service. That is a fact.
As soon as Canada Post is privatized, there will be fewer services in rural areas, and the Bloc Québécois will never be a party to this creeping privatization. What the government is doing is opening up a crack in Canada Post's exclusive privilege, and it will be the beginning of the end. The end, in our opinion, is the privatization of the corporation, which is clearly not acceptable. As soon as it is privatized, service in rural areas will not be as good as in urban areas. Who knows, one day there could well be two sets of postal rates: lower rates for urban areas and higher rates for rural areas. We have to nip this in the bud.
