Rob Moore

[Anti-terrorism Act, February 9th, 2007]

Mr. Speaker, as we know, international terrorism knows no boundaries. These terrorist groups operate in a sophisticated way whether it comes to financing or planning terrorist activities. There is probably no corner of the globe that is not in some way impacted or connected. Even right here in Canada we need to have these safeguards in place.

The member asked about other countries. There are many countries that have taken positive steps to combat terrorism. The United Kingdom, for example, has an even more severe what we could call a regime in place to combat terrorism. Australia and South Africa, as I have mentioned, have provisions in place similar to our investigative hearing provisions. The United States, as I mentioned, has the longstanding grand jury system in place.

Yes, other countries are taking similar steps to combat terrorism.

[Anti-terrorism Act, February 9th, 2007]

Mr. Speaker, I thank the hon. member for his cautions. I appreciate that. I take his point, but I do not think that Canadians need to be reminded at all that we are under an international terrorist threat. There is no denying that. Members of this House acknowledge that. That is why we brought forward measures to combat terrorist activity, whether it is the financing of terrorist activity or the Anti-terrorism Act. We are all working on this, including the Minister of Justice, the Minister of Public Safety, the provinces, police agencies and Canadians. All of us should be working to prevent terrorism.

I do not look at the fact that these provisions have not been used as a reason to allow them to sunset. It would be folly on the part of this Parliament to allow important provisions to sunset that were well thought out and that have been considered by House committees and by a subcommittee. They have been considered. We have heard the evidence that these measures are necessary for an extreme circumstance. We do not want to find out after the fact that we should not have let these provisions sunset.

We need to be as prepared as possible. Canadians know the threat of terrorist activity is there. Unfortunately, it will continue to be there for some time. I do not think there is any arguing that we are not out of the woods yet when it comes to a terrorist threat. We want these provisions in place. The member is right in that they have not been used, but that is not to say they should not be kept in place to be used in the future.

[Anti-terrorism Act, February 9th, 2007]

Mr. Speaker, it is important to remember that the committee was of the view that we extend these provisions. The committee responsible did convey that to this Parliament. That is why I am urging hon. members to support the committee's view that these provisions are necessary.

I think the analogy is sound. We do not wish for a fire but we want to be prepared if one takes place. We are certainly not through the danger yet when it comes to international terrorism. We see the impacts and we see the threat every day just by turning on the news.

It is important to note for Canadians that, as the hon. member has mentioned, in regard to the investigative hearing and the recognizance with conditions, those provisions have not in fact been used. I think we should all be grateful that they have not been used at this point, but in the aftermath of September 11, members of this House decided that these were appropriate measures to put in place.

That threat still exists. The committee has encouraged Parliament to extend these provisions for our police to be able to better protect us and our entire system, to be able to better protect Canadians from the threat of terrorism.

I did not name them all, but it is important to know what safeguards exist with respect to investigative hearings: only a judge of the provincial court or a superior court of criminal jurisdiction can hold an officer's application for such a hearing; prior consent is required; the witness has the right to retain and instruct council; and incriminating evidence compelled during testimony or derived from such testimony cannot be used or received against the person in further criminal proceedings, except in prosecutions for perjury and giving contradictory evidence.

I want to leave time for other questions, but there are other safeguards in place that should ring a familiar tone with Canadians because they are components of our justice system with which we are all familiar and support. This is a necessary measure for exceptional circumstances to prevent terrorist activity. That is why we must all support it.

[Anti-terrorism Act, February 9th, 2007]

Mr. Speaker, I can think of no greater duty for a government than to provide for the safety and security of its citizens. The government has clearly demonstrated its commitment to that duty since taking office.

In the aftermath of the September 11 terrorist attacks, Canada put in place the Anti-terrorism Act. Canada's new government continues to support the need to provide the necessary tools to police and prosecutors to prevent, disrupt and deter terrorist incidents.

The motion put before the House today concerns two measures which came into effect five years ago. First, the investigative hearing power in the Anti-terrorism Act. This enables law enforcement officials to investigate and obtain information about terrorism offences.

Second, the recognizance with conditions provision is designed to disrupt emerging terrorist activity by putting a person under judicial supervision. These provisions are designed to prevent the carrying out of terrorist activities and make Canada a more difficult environment for terrorists to operate in. Because terrorism can result in mass destruction and death, punishment after the event is not enough. We must adopt a preventive approach.

Therefore, the key aspect of the provisions under consideration today is prevention, and that is something I believe all Canadians can support. They would also agree that preventing terrorism is not only a Canadian responsibility, but a global responsibility, and prevention of terrorism is an essential goal that we should all share.

Our legislation must be consistent with the Charter of Rights and Freedoms. It must respect human rights. It must be proportional to the threat. It must, at appropriate points, involve the judiciary and it must have effective procedural safeguards.

The investigative hearing and the recognizance with conditions meet those high standards. They are core elements of an appropriate legislative response to terrorism.

The investigative hearing provision has been upheld by our nation's highest court. It allows a peace officer investigating a terrorist offence to ask a judge to require a witness to answer questions before a judge or produce evidence, such as documents or recordings.

When the procedure was scrutinized and affirmed by the Supreme Court of Canada, the court had this to say about the safeguards built into this legislation:

It is clear from the above discussion that the procedural protections available to the appellant in relation to the judicial investigative hearing are equal to and, in the case of derivative use immunity, greater than the protections afforded to witnesses compelled to testify in other proceedings, such as criminal trials, preliminary inquiries or commission hearings.

It is important to remember that these hearings are not meant to punish, but to obtain information that can help prevent a terrorist offence. Not only can they be used to gather information in respect of potential future attacks, but they can also be used to assist in finding the perpetrator of a past attack, who could thereafter be prosecuted and convicted and, most important, prevented from carrying out additional attacks.

A person appearing at an investigative hearing appears as a witness, not as an accused person. The advantage of such a hearing is that a person may be asked questions in a judicial forum where information can be properly received and evaluated.

These hearings, from an investigative standpoint, would likely be more often used to garner information from a peripheral person rather than the actual target of a terrorist investigation. This individual could be brought in and questioned in order to gather information to open up new leads and move the investigation forward. It could also conceivably assist in possible cases where a person may want to come forward, but would be reluctant to be seen to volunteer information in aid of an investigation.

This is an exceptional power. For that reason I emphasize that it can only be used with the proper authorizations. Parliament clearly recognized that it should only be used in very particular circumstances. This House attached many safeguards to its use, including the following: first, requiring the prior consent of the relevant Attorney General; second, giving witnesses the right to retain and instruct counsel and protecting them against self-incrimination; third, requiring federal and provincial attorneys general to report annually to Parliament on the use of these powers; and fourth, making it subject to a five year sunset clause.

The investigative hearing provision has been invoked just once in 2003 in connection with the Air-India case, and even then the hearing was never held. As I said earlier, the Supreme Court of Canada held in 2004, in connection with the same case, that the investigative hearing process was, in fact, constitutionally valid.

The investigative hearing procedure is not without precedent. Indeed, this type of procedure is well known in Canadian law. It parallels procedures employed in the Mutual Legal Assistance in Criminal Matters Act, public inquiries, and coroners' inquests. In addition, section 11 of the Competition Act incorporates court ordered investigative hearings, which are generally held to determine how markets operate and how companies compete with each other.

This type of procedure is also well known in other countries. Australia and South Africa employ a similar legal measure to help investigate terrorist threats to their citizens. The United States has a longstanding grand jury system, and the United Kingdom has a regime under which failure to disclose material information to a constable in relation to a terrorism investigation is a criminal offence.

We are at the five year deadline. We would be neglecting our duty if we allowed these important tools for investigating and preventing terrorist acts to simply expire. Allowing this provision to sunset is not a reasonable option. While some critics of the act would no doubt welcome this option, failing to renew this and the recognizance provision would deprive all Canadians, including the police, prosecutors and the judiciary, of the tools needed to prevent terrorist activities.

Another essential measure in the Anti-terrorism Act is the recognizance with conditions provision. This provision is sometimes known as preventative arrest, which is a very misleading term I should say. Its purpose is not to arrest a person, but to put that person under judicial supervision in order to prevent a terrorist incident.

This provision is meant to be used to allow a person to be released under his or her own recognizance to keep the peace and be of good behaviour, and where warranted, to submit to certain other reasonable release conditions. Such measures are not new in Canadian law. For example, judges have long had the power to require a person to enter into what is sometimes called a peace bond. Such recognizances are used in relation to personal injury and child sex offences as well as criminal organization offences.

The recognizance with conditions in the Anti-terrorism Act is a version of a peace bond. It is designed to prevent, restrict, or disrupt preparations for terrorist activity. For example, these provisions could be useful against individuals who are raising funds or otherwise facilitating the activities of terrorist organizations.

To employ this procedure, the police must obtain the prior consent of the appropriate attorney general. They can only obtain this consent if they believe on reasonable grounds that a terrorist activity will be carried out and suspect on reasonable grounds that the imposition of a recognizance with conditions on a person or the arrest of a person is necessary to prevent the carrying out of the terrorist activity.

In certain limited circumstances, the police may arrest a person without a warrant in order to bring him or her before a judge. A person detained in these circumstances must be brought before a judge within 24 hours, or if no judge is available, as soon as possible thereafter. A hearing is then held with all parties present, including the person's counsel.

At this hearing the judge evaluates the evidence and determines whether the police officer has reasonable grounds for the suspicion. If so, the judge then decides whether it would be advisable to order the individual to enter into a recognizance obliging that person to comply with certain conditions before being released. These conditions might include a curfew, restrictions on the use of telephones or computers, or travel restrictions. Should the person not agree to comply with those conditions the judge may order that the person be detained for up to 12 months.

As with the investigative hearing power, this provision contains robust legal safeguards to protect the rights of the individual, including reporting requirements for federal and provincial attorneys general, the Minister of Public Safety and provincial ministers responsible for policing. It is important to understand that while the police may make an arrest without warrant, they must still subsequently obtain the consent of the relevant attorney general. Also, under these provisions, it falls to the judiciary to determine whether conditions affecting a person's liberty will be imposed. It is not for the police to do so.

Both the investigative hearing and the recognizance with conditions provisions are preventive in nature. In each case, their intended use is to bring a person before a judge, either to advance the investigation of a terrorist offence or to prevent an act of terrorism.

Some would argue that we should eliminate these provisions because they are so seldom required. That would be akin to getting rid of our fire extinguisher because we have never had a fire.

Justice Canada monitors the use of these Anti-terrorism Act provisions in cooperation with other federal departments and our provincial and territorial counterparts. Frankly, we should take great comfort from the restraint shown in their use thus far.

Parliament clearly recognized in 2001 that these safeguards were appropriate and that they were necessary. Parliament just as clearly recognized that we needed new powers to deal with the exceptional new threat posed by international terrorism. That threat continues as we all know.

This can be demonstrated, for example, by recalling the terrorist attacks on mass transportation in Mumbai this past August, in London in July 2005, and in Madrid in March 2004. We should also recollect that Osama bin Laden and the al-Qaeda movement have not retracted their threats against our country of Canada. We should also bear in mind that reports last summer of a plot to bomb trans-Atlantic airliners.

We have also seen on numerous occasions around the world the deliberate mass murder of civilians in public places. Suicide bombings have sadly become commonplace in our daily news reports. Yet, we may be facing an even more devastating threat if terrorist groups gain access to weapons of mass destruction. Cyber terrorism that would seek to paralyze our infrastructure could also have devastating effects. Societies that, like Canada, are open, democratic and technologically advanced could easily be subject to attack in these areas.

Canada's own recent history demonstrates that we are not immune from terrorist incidents. Whether we choose to acknowledge it or not, international terrorism threatens our peaceful communities and our way of life and, regrettably, is likely to be part of our world for years to come.

The investigative hearing and recognizance with condition provisions provide law enforcement agencies with the much needed ability to act quickly when necessary, and potentially save lives. And they can only be activated under special circumstances.

As I said, both of these powers will cease to apply on the 15th day of 2007 on which both Houses of Parliament sit, unless both Houses pass a resolution to extend it.

A sunset clause was inserted in 2001 to allow us to review the powers, with the benefit of five years experience and determine whether they are still desirable and necessary.

These provisions do not exist just for the sake of having them or because the government wants to have them. In a perfect world, there would be no need for such procedures. As we have seen, however, in the real world threats do exist, not just south of the border or in some far off corner of the globe, but right here in Canada, as we discovered last year with the unravelling of an apparent plot to cause violence and destruction in our largest city, Toronto, and right here at our very doorstep in Ottawa. These powers are something we need, not something we want, and they are absolutely necessary.

The House of Commons subcommittee reviewing the act released an interim report on these provisions in October. The majority of the subcommittee recommended that both provisions be extended to December 31, 2011, in other words for five more years, and that Parliament review any further extension beyond that date.

Other recommendations will be addressed by the government in its response to the parliamentary review of the Anti-terrorism Act. This resolution before the House is, necessarily, limited to the issue of whether these existing provisions should sunset or should be extended.

I thank the subcommittee for its timely interim report and excellent work. We look forward to receiving the findings of the subcommittee on the entire review, as well as those advanced in a report by the Senate.

The government believes that the investigative hearing and recognizance with conditions will continue to be important tools for our domestic law enforcement agencies as they act to prevent, disrupt and investigate terrorism.

Both the Minister of Public Safety and the former minister of justice argued before the parliamentary committees reviewing the Anti-terrorism Act that these tools are still needed.

Accordingly, today a motion has been put before this House in an effort to ensure that these powers continue to be available to investigate and prevent acts of terror.

I want to be sure that we as a country have the legislative tools to protect the safety and security of Canadians and to prevent, disrupt and deter terrorist activity here in Canada.

Law enforcement agencies have expressed their support for the continuation of these measures.

For these and other reasons, Parliament should resolve to extend the sunsetting provisions for three years to enable Canada to continue to have the tools necessary to respond effectively to the threat of terrorism.

Why three years? Because this extension would allow Parliament to further consider the issue in depth. It will also give the government enough time to consider recommendations proposed by the parliamentary committees reviewing the Anti-terrorism Act and introduce any changes deemed appropriate.

This is certainly a prudent course to follow. Allowing these powers to lapse would needlessly eliminate a vital tool for ensuring Canadians' safety and security. We need the benefit of several more years of experience with these provisions before we take such a step as allowing them to sunset.

Only Parliament can renew these powers. I believe it is not only a responsibility but a profound duty for us to do so.

I urge all hon. members to support this motion.

[Organized Crime, February 5th, 2007]

Mr. Speaker, I want to thank the hon. member for his question and also for his very hard work on the justice committee.

Gangs and criminal organizations have been growing in size, strength and wealth in this country over the past decade. This government has a very clear legislative package to address this problem. For example, Bill C-10 presently before the justice committee has targeted measures to disrupt criminal enterprises by establishing mandatory minimum sentences for gangsters and organized criminals who use guns, particularly prohibited weapons, to commit violent crimes.

[Criminal Code, February 5th, 2007]

Mr. Speaker, section 347 of the Criminal Code, which prohibits interest of over 60%, was originally brought forward to address the type of loansharking the hon. member has referenced, the serious cases that we perhaps have seen in the movies. People do not imagine, in many cases, the thousands and, indeed, millions of transactions that take place in Canada with some of the payday lending institutions.

As I mentioned, the payday lending branch is a relatively new phenomenon in Canada. It has developed since those provisions in the Criminal Code were made to combat loansharking.

We feel that section 347, while appropriate to deal with loansharking, those type of serious underworld activities, as the member references, is not the best tool to regulate the payday lending industry as it has developed. We feel the group in the best position to regulate this industry is the provinces. We have talked a bit about Manitoba. I mentioned Nova Scotia. We talked about Quebec.

It could be that each province will take a somewhat different approach to regulate payday lending within its jurisdiction. We recognize the different approaches that provinces wish to take. By passing Bill C-26, at their request, we are enabling them to take that approach. It should be mentioned that if a province chooses not to move in this direction and regulate that area of law, then section 347 of the Criminal Code continues to apply to all transactions.

[Criminal Code, February 5th, 2007]

Mr. Speaker, I listened with interest to the hon. member's question. My speech basically refutes everything the hon. member just said. I said very clearly that not all provinces would wish to or need to do this. For example, in Quebec lending at more than 35% is prohibited, so there is no need for an exemption in that province. In other cases the designation will be required.

As the hon. member correctly pointed out, this means that Quebec has essentially banned the practice of payday lending and payday lending institutions by implementing a 35% cap on the maximum amount of interest that can be meted out in a loan agreement. The other provinces are calling for us to pave the way by amending the Criminal Code, which prohibits an amount that would equal over 60% and makes it a criminal offence to charge interest at a rate over that amount. I mentioned that in my speech. The provinces do not feel comfortable bringing in their own legislative frameworks to accommodate their consumers until we at the federal level pull away from that area of jurisdiction.

Quite to the contrary, we are actually recognizing the competence and the jurisdiction of each province to put in place its own framework. Quebec has done so. Manitoba and Nova Scotia have also done so. The approach that Manitoba and Nova Scotia wish to take requires Bill C-26 to pass. This would allow provinces to legislate in this area to protect their own consumers.

[Criminal Code, February 5th, 2007]

Mr. Speaker, that is a good question. Earlier in my speech I mentioned the total annual cost of borrowing, including all fees, some of which I named, and the interest that is charged. Worked out annually it could be over 100%, 200%, 300% or even 1000%. It is in fact the fees that are adding to the overall cost of borrowing, as well as the interest.

What is important to note is that Nova Scotia and Manitoba have taken up the call to protect their consumers in their respective provinces. They have put in place a framework that will put a maximum in place in regard to protection for consumers so that there can be a better understanding of the relationship that the consumer is entering into with a payday lending institution.

But in order for them to feel comfortable in enacting that legislation, in making that legislation the law, they first require the passage of this bill, Bill C-26, which would amend the Criminal Code and in fact would pave the way for the provinces to bring in their own frameworks, frameworks that are appropriate for each province.

[Criminal Code, February 5th, 2007]

Mr. Speaker, today it is my pleasure to rise in support of Bill C-26, An Act to amend the Criminal Code (criminal interest rate). The bill has come to be described as the payday lending bill because the amendments that it proposes are targeted at the payday lending industry, an industry which has quickly established itself in Canada but which to date has operated in an essentially unregulated environment.

Bill C-26 proposes amendments to the Criminal Code which will assist in remedying this. The bill is about greater consumer protection for the estimated two million Canadians and their families who use the services of payday lenders on an annual basis. The bill reflects the government's continuing commitment and dedication to improving the lives of all Canadians.

I am proud to speak in strong support of Bill C-26 and I urge all hon. members to join with me to ensure its quick passage into law.

The payday lending industry is flourishing in Canada. The industry first originated in the United States before moving north to Canada in the mid-nineties. Since that time the industry has grown rapidly with an estimated 1,300 payday lending outlets operating across Canada. The industry's principal lobby group, the Canadian Payday Loan Association, notes that there are approximately two million payday loan transactions annually in Canada.

A report prepared by the Public Interest Advocacy Centre in 2002 estimated that between 1 million and 1.4 million Canadians used the service of payday lenders, so the numbers appear to be going up. We also know that nearly $2 billion is borrowed through payday loan centres on an annual basis. These numbers frankly are astounding. Yet, what is most surprising is that the rapid growth of this industry has occurred in the absence of any industry specific regulatory framework. The absence of this framework has left consumers vulnerable to questionable business practices.

Some might ask why would any person choose to use the services of a payday loan centre if doing so puts the individual at risk of some unscrupulous lenders. The reasons are many. Some consumers use the services of the industry because it is a relatively easy, fast and anonymous way to borrow money. Others have suggested that the reason is that payday lenders offer convenience, including the extended hours of operation and the prevalence of such centres in communities across Canada.

This, combined with the fact that many small towns and cities across Canada are losing their local banking branches, makes the payday loan store an attractive way to access one's money. However, it is those consumers who have come to rely upon payday loans in order to pay their bills, to have enough money to put food on the table, and get by from paycheque to paycheque, who are the most vulnerable to abuse.

It is precisely these facts which place already vulnerable consumers into an even more vulnerable position as they may be willing to accept the terms of a loan without question or out of sheer necessity. That is why it is imperative that we move quickly and ensure that Bill C-26 becomes law.

A payday loan has really become a catchy moniker for what is otherwise a short term loan, often for a small amount, secured against proof of one's income. Most often it is demonstrated through proof of employment and hence the term payday loan. This need not be the case however. Other examples include pension income.

A typical payday loan is usually in the range of $300 and lasts for about 10 days. To qualify, in addition to demonstrating an income source, the consumer must have a bank account and provide a post-dated cheque for the amount of money borrowed, plus the associated fees and interest owed on the loan. These fees can include application fees, brokerage fees, administration fees or processing fees and so on.

We all know that payday lending is a very expensive way to borrow money. In some cases estimates for the interest rates charged when calculated on an annual basis reach into the thousands and even tens of thousands of per cent. With rates like that it is no wonder that the profits for payday lending companies continue to go up and the industry continues to thrive.

For better or for worse the reality for the payday lending industry in Canada appears to be right, but the reality for some of its consumers is less so. When consumers have difficulty paying back the loan, lenders may let one short term loan rollover into the next and so on. Debt load goes up, and the already struggling consumers find themselves in a position where the debt load is spiralling out of control.

When they are unable to pay back their loan, there have been concerns expressed with respect to the debt collection practices employed by certain segments of the industry. Oftentimes the borrower may have been unaware of the many terms and conditions associated with the lending agreement, those aspects of the loan that one could expect to find buried among the fine print.

This is confirmed by the Public Interest Advocacy Centre in a report entitled “Fringe Lending and Alternative Banking: the Consumer Experience”, which notes that most consumers of alternative financial services such as payday lending are unaware of the cost of the services they use.

This government believes that consumers should be afforded effective consumer protection from this industry. That is why Bill C-26 is so important.

Many, including the provinces and territories as well as consumer advocacy groups, have said that section 347 of the Criminal Code remains a barrier to the effective regulation of the payday lending industry in Canada. The provinces and territories have said that they will not take steps to regulate the payday lending industry when section 347 makes such activity technically illegal.

Section 347 is the usury provision. It creates two specific offences: one, to enter into an agreement or arrangement to receive interest at an annual rate exceeding 60%; and two, to receive payment or partial payment of interest exceeding 60%.

While these provisions were enacted to combat the practice of loansharking, the reality is that they also apply to most lending arrangements in Canada, including payday lending. Bill C-26 therefore proposes to amend section 347 of the Criminal Code and thereby clear the way for the provinces and territories and provide the flexibility they need to regulate the payday lending industry.

The amendments proposed by Bill C-26 are not long and they are not complicated. Essentially they carve out a limited exemption from the applicability of section 347 for payday lenders in prescribed circumstances. By proceeding in this fashion and crafting a narrow exception rather than repealing section 347 in its entirety, Bill C-26 ensures that all Canadians will be afforded protection from the exploitative practices of loansharking while at the same time responding to the needs of the provinces and territories in relation to the payday lending industry.

The proposed exemption scheme would be established under a new section, proposed section 347.1. This new section prescribes the exact circumstances that would need to exist in order for a payday loan to be exempt from section 347.

First, Bill C-26 proposes to define a payday loan for the purposes of the exemption. This definition is important because it ensures that only a clearly defined class of lending arrangements will be eligible for being exempt. As such, “payday loan” is defined to mean as follows:

--an advancement of money in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbroking, a line of credit or a credit card.

In my opinion this definition is appropriate. It appropriately captures the typical payday loan scenario that I described earlier and provides the precision necessary to specify which loans will be captured by the exemption and which ones, where the policy considerations are different, will not be eligible.

Bill C-26 proposes three requirements that must be present before a payday loan will be exempt from section 347. First is that the loan amount not exceed $1,500 and be for a term that is less than 62 days. As such, not all payday loans will be eligible for exemption, only those that fall within these further restrictions. These limits appropriately reflect the fact that payday loans are generally for a small sum over a short period of time.

Second, the payday lender must be licensed or otherwise authorized by the province in which it operates to enter into a payday lending arrangement. This is the crucial component of the amendments proposed by Bill C-26, because this requirement will ensure that for an exemption to apply there must first be laws in place to govern payday lending in the province in question. Ultimately, it will be up to the provinces and territories to decide whether and, in virtually all respects, the extent to which they will legislate.

The only requirement that Bill C-26 requires in relation to the provincial legislative framework for the exemption to apply is that there be a prescribed limit on the total cost of borrowing. This makes sense. This requirement will ensure consumers know exactly how much they are paying for accessing a payday loan.

Finally, Bill C-26 provides that if a province or territory wishes to regulate the payday lending industry in a manner which would exempt payday lenders from section 347 of the Criminal Code, then they will also be required to be designated by the federal government.

Not all provinces will wish to or need to do this. For example, in Quebec lending at more than 35% is prohibited, so there is no need for an exemption in that province. In other cases, the designation will be required.

Seeking this designation is very straightforward. For such a designation, a province would write to the federal Minister of Justice and indicate that it has legislative means in place that provide consumer protection measures for those who seek payday loans, including, as noted already, a limit on the total cost to consumers for payday borrowing.

Upon the province's indication that requirements for an exemption have been met, and upon the recommendation of the federal Minister of Industry, the Minister of Justice would then recommend to the governor in council that the exemption be made.

Importantly, this designation can be rescinded at any point at the federal level in those instances where the province no longer meets the requirements for the designation or where the rescission has been requested by the province. This is a pragmatic and sensible approach in a country as vast and diverse as ours. The decision on how to regulate the payday lending industry will be entirely up to the provinces.

Indeed, consumer protection measures fall within the constitutional competence of the provinces and territories. The provinces already have consumer protection legislation designed to address the specific concerns and realities of their jurisdictions and they are the best place to identify the components that are necessary to ensure effective consumer protection within their own jurisdiction.

The approach provided for in Bill C-26 complements this existing provincial legislative framework. I support this approach. It makes sense and will facilitate greater regulation of the payday lending industry across Canada.

Contrary to what some might say, Bill C-26 is neither encroaching upon provincial jurisdiction in relation to consumer protection measures nor necessitating that provincial governments seek a federal blessing or stamp of approval for its consumer protection measures.

In fact, Bill C-26 does quite the opposite. Bill C-26 would amend the Criminal Code to provide the provinces and territories with the flexibility they need, and indeed, the flexibility they have requested, to enact consumer protection measures within their jurisdiction to better regulate the payday lending industry.

As I mentioned, many jurisdictions have indicated that section 347 of the Criminal Code hampers their ability to enact consumer protection legislation within their own jurisdiction. By removing this barrier, Bill C-26 will facilitate greater regulation at the provincial level and meet the needs of consumers and the groups who have advocated on their behalf.

These proposed amendments are long overdue. As I noted earlier, the payday lending industry originated in the United States before spreading north into western Canada in the mid-1990s. In the United States, many state legislatures have taken the necessary steps to regulate this industry in order to protect their consumers from unscrupulous business practices.

To name only a few, California, Vermont, Michigan, Mississippi, New York and Virginia all have legislation in place to regulate the payday lending industry. While the exact content of the legislation varies from place to place, common features of payday lending legislation in the United States include limits on the amount of money that can be borrowed as well as the cost associated with the loan.

We see the same thing happening right here in Canada. Already, Manitoba and Nova Scotia have enacted legislation in their provinces to provide greater consumer protection for those who use the services of payday lenders. In Manitoba, for example, the Consumer Protection Amendment Act received royal assent on December 7 of last year. In Nova Scotia, the Consumer Protection Act was amended and received royal assent on November 23 of last year.

Both of these pieces of legislation are specifically designed to regulate the payday lending industry in those provinces. They include requirements for lenders and set out rights for the borrower, and both provide that a maximum will be set on the amount that can be charged for a payday loan. Both of these pieces of legislation are not yet in force and are in fact awaiting the passage of Bill C-26 before taking effect.

The governments of Manitoba and Nova Scotia are watching the progress of Bill C-26 because its passage will ultimately mean greater protection and greater regulation for the industry, which of course will be of benefit to consumers in those provinces. Other provinces have indicated they will follow suit.

With the passage of Bill C-26, the provinces and territories will have greater flexibility in addressing the payday lending industry within their own jurisdictions. The approach we are taking is the right one.

In closing, the protection of Canadian consumers is something on which we can all agree, and I believe that Bill C-26 will provide for this. I urge all hon. members to join me in supporting its quick passage into law.

[Justice, February 2nd, 2007]

Mr. Speaker, we are listening to all stakeholders. There are many aspects to the problem of prostitution and ensuring the protection of those who work in the sex trade is a priority. However, the government does not feel that decriminalization is one of those appropriate responses.