Roger Pomerleau

[Bank Act, April 17th, 1996]

Mr. Speaker, I am somewhat taken aback by the question of my colleague from the Reform Party. Basically, he is asking me whether Quebec could survive without the dairy subsidy. We all know the Canadian government announced in its last budget the elimination of this subsidy. In the last two years, it has already been reduced by 15 per cent, and it will be completely eliminated within three to four years.

In the meantime, billions of dollars have been invested in western Canada, where the elimination of the grain transportation subsidy has been compensated by other payments.

The hon. member spoke about international relations. When Quebec becomes a country, it will have to make international commitments just like any other country, just like Canada, Singapore, France or Italy. It will then need the necessary tools to do so.

For the time being, Quebec is under the Canadian Constitution and is a part of Canada, and it has to abide by federal regulations. Ever since Confederation, the federal government has felt the need for a complete centralization of economic and political powers in Ontario. It may be a fundamental need for Canadians, and a matter of survival for them. But this centralization is effectively depriving Quebec of its economic infrastructure and political power.

Surely, my colleague realizes that a country can have, on international markets, facilities a province cannot have.

[Bank Act, April 17th, 1996]

Mr. Speaker, Bill C-15 is now at third reading stage. This legislation is practically a jumble of disparate measures aimed only at increasing surveillance and regulation of the financial services sector in Canada. This bill amends several acts relating to financial services and repeals the Investment Companies Act.

Though we do not oppose the principle of this bill, we have several concerns regarding the federal government's true intent. In fact, this legislation brings us one step closer to a control of the securities sector in Canada. This control will eventually be exercised by the Bank of Canada.

Bill C-15 uses the excuse of controlling systemic risk to allow Ottawa to impede on a purely provincial jurisdiction. We have discussed this point last year when Bill C-15 was Bill C-100. These are examples reported by the hon. member for Saint-Hyacinthe-Bagot. This bill impedes directly on an area of jurisdiction which is exclusively provincial, namely the securities sector under which come all liquid assets, shares, certificates and also bonds, to name but a few.

Yet, two sections of the Canadian Constitution empower provinces to regulate securities. The first one, section 92.13, deals with property and civil rights in the provinces. In Quebec, securities are regulated under the Civil Code. The second one is section 92.16, which states that all matters of a merely local or private nature fall under provincial jurisdiction.

Quebec is already involved in the area of securities, through the Commission des valeurs mobilières du Québec and the Inspecteur général des institutions financières. Bill C-15 will create useless and costly new overlap-goodness knows how many instances we have reported already-by subjecting Quebec financial institutions to orders and directives from the Bank of Canada.

In addition, by implementing a Canadian clearing system, the Governor of the Bank of Canada retains the right to issue directives not only to clearing houses, but also to participating financial institutions, regardless of their charter. The bill will therefore enable the governor to issue orders and directives to institutions

such as the Fiducie Desjardins, and to some extent, this is a strange twist of fate.

It will be remembered that, if I am not mistaken, before founding the caisses populaires in Quebec in the early 1900s, Alphonse Desjardins had served as clerk in this House and later at the national assembly in Quebec. Alphonse Desjardins decided to start this co-operative system because there was a problem with the banking system in Quebec. The banks, which were predominantly English at the time, refused to make loans to French speaking Quebecers. Also, there were no banks in rural areas. All banks were concentrated in major financial centers. That is why Quebecers did not deposit their money in banks that refused to loan them money, and how the Quebec tradition of stashing one's savings in a wool sock came about.

In response to this situation, Alphonse Desjardins decided to establish a financial institution to provide Quebecers with those services not provided to them by banks. He came to Ottawa to apply for a charter, which he was denied, because the banks were afraid such an institution would be in competition with them. His application for a federal charter was therefore rejected. That is why Alphonse Desjardins finally established his caisses populaires under provincial charter. Banks resisted this idea for years.

I remember that, up until the early 1960s, banks refused to cash cheques drawn on caisse populaire accounts. It was a long battle before Quebec got a first-rate economic tool: credits unions, called caisses populaires in Quebec. We accomplished this all on our own. I recall that this was achieved with people getting fully involved, and working out of church basements.

A lot of people worked on a volunteer basis for many years to develop this economic tool. We did it on our own despite early opposition. Now that this tool is in place, the Government of Canada wants to regulate this tool we developed ourselves. This, of course, is unacceptable.

The bust of Alphonse Desjardins is now on display in the CN Tower in Toronto, since he is recognized as one of 10 great Canadians. The fact that visitors to the CN Tower can see it has not prevented the government from trying to regulate this institution, even though it was almost opposed to its founding.

May I remind you that the bust of Joseph-Armand Bombardier is also displayed in the CN Tower in Toronto, which did not prevent the federal government from taking over all his patents in 1945.

Another thing that bothers me in this bill is the concentration of power in the hands of a few individuals. This is what this bill does. It amends certain laws, including the Winding-up Act, to give the Superintendent of Financial Institutions even more powers. This bill and all the federal bills that have been tabled since this government came to office are aimed at concentrating even more power in the hands of those who already have it, be it a minister or the Superintendent of Financial Institutions.

In any case, broadening the powers of the federal Superintendent of Financial Institutions will only lead to costly duplication, for which taxpayers will have to pay once again. Considering how long we have been talking about it, the government should have understood that federal intrusion in a sector which comes under provincial jurisdiction only generates inefficiency and useless costs. Not to mention the debates that will follow between the federal and provincial governments, at a time when constitutional talks are scheduled to take place in the months to come, at least according to the 1982 Constitution. The Prime Minister assures us that, under these conditions, the federal government is prepared to withdraw from those fields which come under the exclusive jurisdiction of the provinces. Is it not true that the Prime Minister takes with one hand what he is willing to give us with the other? This situation is unacceptable.

What this government does is to stimulate competition between levels of government. But let us not forget that such competition between governments is never beneficial to ordinary citizens. Just think of manpower training, to which we refer daily because Quebecers notice it more and more. In Quebec, there is an obvious consensus regarding the need to patriate manpower training. This consensus among all the stakeholders goes back several years, but the issue remains unsettled. Meanwhile, this overlapping of jurisdictions costs over $250 million every year.

The expanded authority delegated to the superintendent provides boundless power to a single person and could well trigger a legal battle between Ottawa and Quebec. Should this be the case, it would adversely affect financial institutions that are in difficulty as well as individual investors.

I cannot understand what motivates the federal government. Why does it want to control a sector which has been very well monitored in Quebec for a long time now? I conclude that the federal government wants to find a way to interfere in the administration of the various provincial institutions, particularly in Quebec, for it clearly senses that federalism as it currently exists is about to become uncontrollable.

It is also preparing for the next round of constitutional talks, which will come along eventually, by seeking out powers it can later return to the provinces, saying: "Look how generous we are, giving you what you want". They are withdrawing from certain areas of provincial jurisdiction, while on the other side of the coin they will in fact have lost almost nothing, because they will have

acquired other means of control, other levers of power, taxation in particular. Such is the case with the bill we are looking at today.

We can, therefore, predict that there will, in fact, be nothing but cosmetic changes. The Bloc will never agree to give up an area of jurisdiction that is, and always has been, exclusively provincial. As my colleague has already pointed out, even Daniel Johnson, when he was premier of Quebec in 1994, said there was no question of the Liberal government in Quebec's accepting encroachment by the federal government in securities matters.

He added that the Government of Quebec would refuse and would jealously guard its prerogatives in this area. As we saw very recently, Mr. Johnson is opposed to what is happening in the House. Today he is dissociating himself from the idea being promoted in recent days of Quebec's being a homeland.

The government in Ottawa appears to stuck in an impasse where it cares little about contradicting its allies in Quebec, who, are increasingly in agreement-and are forced to be-with the claims of the sovereignists, regardless of what the Prime Minister and his ministers may say.

But, worse yet, the government is mocking the basic provisions of the Constitution, the very Constitution it so often preaches and talks about. The cost of Bill C-15 goes even beyond areas of jurisdiction. As I said earlier, the financial institutions of Quebec and investors will be the victims of the duplication of roles Ottawa wants to impose, because securities officials need coherent and stable legislation, as in the case of other sectors involved in financial markets.

Instead of maintaining stability and consistency, two attributes highly prized by global financial markets, the federal government tells us, through Bill C-15, that it wants to establish its own institutions and allow the Bank of Canada and the federal Superintendent of Financial Institutions to intervene in the area of securities. The government's attitude is unacceptable.

When the secretary of state responsible for Canadian financial institutions testified before the finance committee last August, he failed to answer the Bloc Quebecois' questions about the federal government's encroachment on the area of securities, which, according to the Constitution, comes under the exclusive jurisdiction of Quebec, as we pointed out earlier. He tried to evade the issue, as can be seen from the minutes of the committee proceedings. It seemed to us that the secretary of state did not even know what was in his bill.

The secretary of state denied at the time that his government intended to encroach on the area of securities. We were sold a bill of goods, as the recent throne speech clearly referred to the establishment of a Canadian securities commission.

We opposed the government's amendments, because they did not meet expectations in any way, just as Bill C-15 does not meet Quebec's expectations. This bill is written in a very technical language, of course, because it deals with technical matters, and it is very thick. This leads us to believe that the government is trying to confuse the opposition and the public, since the amendments in this bill, which are supposedly minor in nature, in fact have very serious consequences.

We can only lament the fact that, almost every time a government bill is introduced, we in the Bloc are always led to condemn the same things. The government is using every means available in an attempt to centralize ever more. There is always a good excuse: market globalization, international competitiveness, systemic risks or what not. It is a real shame to see that, at a time when the government claims publicly that agreements can be reached with the provinces, it is doing exactly the opposite in legislation. They are not entering into any agreements with the provinces, they are centralizing.

Four times already since the last federal budget was tabled, Ottawa has introduced a bill affecting federal-provincial relations, without even consulting the provinces. I am referring here to Bill C-76, implementing the budget and imposing national standards; Bill C-88, to implement the agreement on internal trade, which gives retaliatory powers to the federal government; Bill C-91 on regional development, which enables Ottawa to sign agreements with local authorities directly, without regard for provincial governments; and of course the bill before us today, Bill C-15.

It is incredible. The government says agreements can be reached with the provinces and it talks about decentralizing, while its actions are to the contrary, and history has taught us these past 30 years or so that actions speak louder than words.

We will recall the commitments made by Mr. Trudeau in 1980. There is no need for me elaborate on this, since we are all quite familiar with these promises. "We are putting our seats on the line to ensure changes take place", they said. It is now 1996. In the meantime, the Constitution was patriated in 1982, but nothing changed for Quebec. These were all empty words and meaningless commitments. Today, they are talking about decentralizing, but every bill they introduce in this House contradicts the commitments they had made.

We all remember the commitments made by the current Prime Minister in the final days of the referendum campaign, when he said: "We will see to it that Quebec is recognized as a distinct society". Already this promise has been forgotten. Through all this, we realize that commitments are meaningless, because there is never a real will to honour them.

The only things that are decentralized are of course the cuts. I want to talk about one of them, in the energy sector, since it was mentioned yesterday and today. Over the last 20 years, the federal government has invested $12 billion in Ontario for atomic energy research. It is also investing, of course, a few billions in the Hibernia project, in Newfoundland. However, in Quebec, the government cut the Tokamak nuclear fusion research project, in Varennes, in which $7 billion was invested annually until now.

So, the government invests billions elsewhere, but any cut made affects Quebec of course. The government uses words which are meaningless or which say the opposite of what it intends to do.

Remember, in 1980, we were told: "If Quebec becomes sovereign, you will end up with a huge debt, high taxation and high unemployment. You, little Quebecers, cannot achieve sovereignty". And what did we get since 1980? That year, the federal debt stood at $80 billion. Today, it is close to $600 billion, in spite of the fact that taxes and unemployment have never been so high. In other words, what we feared we would lose in 1980 by becoming a nation we lost by remaining in the Canadian confederation.

Recently, before the last referendum, we were told: "If you become sovereign, you will lose all your dairy subsidies". Yet, we were just told in the last budget that all dairy subsidies in Quebec would be eliminated over the next five years.

So, these are meaningless commitments. The government uses the pretext of a systemic risk to introduce Bill C-15 and get involved in the securities industry, even though the Governor of the Bank of Canada himself stated last summer that such risk could be controlled through increased monitoring of the major payment transfer system.

Obviously, this bill is totally unacceptable to us, since it merely seeks to allow federal intrusion in areas which come under Quebec's jurisdiction.

[The Budget, April 16th, 1996]

Madam Speaker, I listened carefully to the speech my hon. colleague just made. He concluded by saying:

Our government must be fiscally responsible-

I would just like to ask my hon. colleague a question. We know that the government has planned everything needed to undertake, during the summer or at the end of it, a review of the Canadian tax system. And to do so, the government has designated the best tax experts in Canada. These people will have to review tax havens, among other things. We have clearly demonstrated in this House that these tax experts are the biggest users of tax havens in Canada. They are the ones who advise corporations on how to use tax havens and to take tax avoidance to extremes.

Our hon. colleague says:

Our government must be fiscally responsible-

Can he tell us why the people who benefit the most from our tax system are asked to review the whole system? And what does he have to say about the members of this House being excluded from this review?

[Distinct Society, April 16th, 1996]

Mr. Speaker, without any debate, the Quebec wing of the Liberal Party of Canada replaced the notion of distinct society by the diluted phrase "principal homeland of the French language, culture and legal tradition in North America" to describe Quebec.

Painted into a corner by the rank-and-file of his own party, in the final days of the referendum campaign, the Prime Minister made one commitment after another to recognize Quebec as a distinct society. Now, he is only asking for the recognition of the French fact in Quebec.

What the Prime Minister and the Minister of Intergovernmental Affairs are seeking above all is to increase the level of satisfaction in the rest of Canada at the expense of interests which are specific to Quebec. It would seem that the Prime Minister has not yet realized why the Bloc Quebecois is still the official opposition in this House.

[Canada Business Corporations Act, March 28th, 1996]

Madam Speaker, since it is the first time that I rise in this House while you are in the Chair, let me congratulate you on your appointment.

I am pleased to speak today to Bill C-204, which was introduced by my colleague opposite, the hon. member for Mississauga-South. My colleague began his speech by telling us that he decided to propose this amendment to the bill because he had met a senator who was apparently sitting on 26 boards of directors. My colleague inferred that the senator probably wanted to enhance his reputation, but perhaps there are other premises that are just as valid. Given the nature of a senator's work, he had ample time to sit on 26 boards of directors.

The purpose of the bill introduced by my colleague, an act to amend the Canada Business Corporations Act, is to prohibit any person from holding a directorship in more than 10 companies in which the person holds less than 5 per cent of the voting shares. My colleague seems to base his bill on the premise that a person who is a director in more than 10 companies cannot properly carry out his mandate.

True, as my colleague pointed out, company directors have a number of responsibilities that are very important and very serious. They are required by law to assume many of these responsibilities and to perform very specific duties.

My colleague who introduced this bill is asking the following question: At what point can a director or administrator no longer properly fulfil his responsibilities?

He seems to think that one can no longer properly fulfil one's responsibilities if one holds a directorship in more than 10 companies. I do not know on what basis the hon. member can make that claim. Why would a director of 9 companies be able to perform his duties, but not a director of 12 companies? That question remains unanswered.

When someone is mandated by shareholders to sit on the board of directors of a business corporation, he is required by law to meet certain obligations. He has a duty to do so. He must look after the interests of the company, as he would after those of his own family. By law, he is accountable to shareholders for his actions.

A director may be held personally responsible if, for example, he misuses or embezzles company funds or if he makes the company insolvent.

The director must be honest, loyal, careful and diligent. Of course, his personal interests must not conflict with those of the company he administers. It goes without saying that he must attend meetings of the board of directors. I will not start listing everything a director must do or not do. I think everybody here has a pretty good general idea.

Frankly, I really do not see the use of my hon. colleague's bill. Why propose to amend the Canada Business Corporations Act by amending only one section, namely section 105, by adding a detail that, as far as I am concerned, is basically useless? Why prevent someone from being a director of more than ten corporations? The same person can sit on the board of directors of 13 corporations and do a very fine job, the same way that another individual could be a director of a single corporation and fail in his duties and responsibilities. It all depends. Some people can handle it, others not.

The directors of a corporation are responsible and accountable to the shareholders. If the shareholders are dissatisfied, all they have to do is to remove them from office by a vote of non-confidence.

The Canada Business Corporations Act is also quite clear on that. A director who commits an illegal act or who works against the interests of the company is liable to very harsh penalties and fines. It is definitely not in his best interests to break the law or to commit acts for which he would be held accountable.

Any reasonable person who is sound of mind-maybe some are not-knows what he is able to do and accomplish. A director knows the duties and responsibilities related to his directorship. It would not be in his best interests to fail in his duties, because he knows what the consequences would be. So, I say: Why would he take a chance and sit on several boards if he knows that he not able to do the job?

Let me show you that the arguments used by the hon. member in his memo to support his bill are far from justifying the inclusion of his proposed amendment in the Canada Business Corporations Act.

First, the member says:

"A director is not bound to attend all meetings of the board. He ought to attend as often as possible as he may be held liable for transactions of which he has no knowledge".

An occasion will undoubtedly arise when a director is unable to attend a meeting of the board of directors. However, in any reasonably well organized company, an agenda and minutes are distributed to directors. Normally, when someone takes a decision involving a company, those responsible are informed. I dare say

that anyone unable to attend such a meeting would have the sense to ask his colleagues what was said or done. Directors of companies are aware of that.

The second argument put forward by my colleague is the following:

"A director cannot shirk his responsibilities by leaving everything to others. He relies on other directors at his own risk. The reliance on his co-directors and officers should not be unquestioning".

When you sit on a board of directors, you are part of a team. A director must trust his colleagues. Otherwise, the entire team suffers.

Imagine what it would be like if the directors did not trust each other? Imagine the acrimonious atmosphere. If board members do not agree, the company or corporation will suffer, and this will lead to shareholder dissatisfaction. The shareholders can then dissolve the board of directors. It is therefore not in the best interests of a director to start off by doubting his fellow directors.

Another argument used by my colleague is the following:

Directors rely on officers at their own risk and should not abdicate their duties to manage the corporation.

Usually, the board of directors makes the decisions on the company, and the executive directors or the operational managers effect them on site. The executive director, who looks after the day to day running of the company, sits on the board of directors and must report on company activities to the directors.

Usually someone whom everyone trusts is chosen to head the company. If there are risks involved in relying on the executive director, they are normal risks. People can be dishonest; but that can happen any time and any place. It is impossible to know whether a person is honest at the start. My colleague's argument does not hold.

I could go on at length like this, but it would serve no purpose. None of my colleague's arguments has convinced me of the absolute need to amend the law as he proposes.

I will read you the recommendation that led him to propose this bill, which begins as follows:

In an effort to protect and/or emphasize the importance of director's duties and responsibilities, to minimize the potential for conflict of interest, to protect investors, companies and employees, that no person may be director of more than 10 corporations in which the person holds less than 5 per cent of the voting shares.

The duties and responsibilities of directors are clearly defined in the Canada Business Corporations Act. People who hold directorships know very well what their duties and responsibilities are. They know what are the consequences of their actions or lack of action because this is also provided in the legislation.

I completely fail to see how Bill C-204 will reduce conflicts of interest within a company. Unfortunately, there will always be conflicts of interest. My colleague from Mississauga-South made a worthwhile effort and analyzed the situation carefully before putting this bill forward. I am convinced he spent a lot of time on this, but I must say I do not see the use of amending the Canada Business Corporations Act in a way that would basically have no positive impact.

[Bank Act, March 28th, 1996]

Mr. Speaker, I would also like to speak about the three amendments proposed by the Bloc Quebecois. We know that Bill C-15 before us today, even if it is not a major bill like others tabled in the House, still brings many amendments to the whole series of existing acts, as my colleague said earlier.

Even though we have no objection in principle to this bill, which actually aims to increase regulation of financial services in Canada, we have a lot of concerns and the amendments we introduced today reflect precisely these concerns.

This bill is not a reform of the legislation governing financial institutions. This reform will come later on, because, as we know, a white book is in the makings. We believe the bill before us today is actually a step forward. It prepares the ground for the control of securities in Canada.

What are the amendments we are proposing? My colleague has read some of them and I will repeat them in a few words. The first amendment proposes to delete the words "securities" in a text. By deleting this word, we are taking "securities" out of federal jurisdiction. We believe that this is strictly a provincial jurisdiction and that the act, as it presently stands, should apply to everything else but not directly to securities.

The second amendment, which we have added, aims at excluding from federal guidelines institutions already participating in securities clearing houses. What purpose would it serve? Duplication, of course. This already exists in provinces.

The third amendment limits the federal government's regulatory power to the settlement of payments and not to the institutions involved. As my hon. colleague pointed out, we want it limited to the management of systemic risk and not used for other considerations.

Why exactly did we table these motions? I will go over some of the arguments so it will be very clear, given that the text is highly technical. A Canadian clearing system is currently being developed, set up and implemented and will eventually come under the control of the Bank of Canada.

This is part of our concern, as Quebec is already involved in this sector through the Commission québécoise des valeurs mobilières and the Inspecteur général des institutions financières, like the other provinces. Schedule I of Bill C-15 will create costly new duplication, by subjecting Quebec financial institutions to orders and directives from the Bank of Canada.

Bill C-15 uses the pretext-it is quite common for pretexts to be used, and I will come back to this at the end-of systemic risk control to allow Ottawa to meddle in this area. The governor of the Bank of Canada acknowledged, last June 20, that this risk was no longer a problem because of tighter control over the large value transfer system. In addition, under clause 6 in Schedule I, which will implement a Canadian clearing system, the Governor of the Bank of Canada retains the right to issue directives not only to clearing houses, but also to participating financial institutions, regardless of their charter. Thus, Bill C-15 will enable the governor to issue orders and directives to institutions such as the Fiducie Desjardins.

Secondly, they are using this bill to amend the prerogatives of the Superintendent of Financial Institutions and the Winding-up Act. Bill C-15 also gives more powers to the Superintendent of Financial Institutions, and, as we have pointed out since our arrival here, in almost all federal bills, power is being concentrated more in the hands of those who have it-be they ministers or the Superintendent of Financial Institutions.

Expanding the prerogatives of the federal Superintendent of Financial Institutions will mean costly duplication and inefficiency.

Indeed, in Quebec the inspecteur général des institutions financières already exercises some control over chartered banks, which means that the new powers given to the federal superintendent will overlap existing powers at the provincial level. This overlap is costly for the Quebec taxpayers-as we are well aware, since it is constantly being raised in the House-and for the Quebec chartered banks faced with insolvency problems.

Bill C-15 may lead to contradictory signals from provincial and federal authorities-this too has been pointed out ever since we came to this House. In this respect, let us remember that competition between governments will never be cost effective for the public. As for manpower training-an issue on which all stakeholders in Quebec have clearly been in agreement for a very long time, and which is not yet resolved-at least $250 million a year is wasted on this. The extension of the prerogatives of the superintendent may also lead to legal wrangling between Ottawa and Quebec, while the financial institutions facing problems and the people who have invested money will be forgotten.

In summary, if this bill does not take into account the amendments proposed by the Bloc Quebecois, there will definitely be-and I repeat the two or three points I made-overlap with provincial jurisdiction-and even the federalists in Quebec recommend that the Government of Canada not do this-costly duplication and overlap, and the system will, of course, be less efficient.

We can only lament the fact that, in most bills introduced in the House, we are always led to condemn the same things. The government uses all kinds of means to try to centralize ever more. All kinds of reasons are raised-market globalization, systemic risks, international competition. Technological inventiveness was just raised as a reason, implying that, for technological reasons, we will now have to centralize ever more. It is extremely sad to see that, at a time when the government claims publicly it is possible to reach settlements with provinces, it is doing exactly the opposite in the legislation. In Ottawa, greater centralization is the order of the day.

In conclusion, I want to reply to my hon. colleague from the Reform Party, who said that this highway being constructed must be more closely regulated and further centralized, and that, at both ends of that highway, culture will not be affected. Culture starts with the full control of all the economic levers. If Quebec gives up that much each time a bill is passed in the House, if there are no tools to protect Quebec's traditional positions, even within the constitutional limits, culture will eventually disappear.

[Department Of Public Works And Government Services Act, March 26th, 1996]

Mr. Speaker, because of a misunderstanding I spoke before my turn, but my colleague pointed out the difficulty companies, in Quebec in particular, but I suppose it is the same in Canada, have in negotiating with this department. This department has even to some extent paid people so it could understand what it was doing.

The question is often raised in my riding as well: Why is it that it was so difficult to deal with this department? We note, and perhaps this is part of the answer, in the case of the task force on taxation that was established, that the people who will be paid to study the impact of tax havens are in the first place the main users of those tax havens and major contributors to the Liberal Party.

In fact I think the difficulty in gaining access to this department has something to do with whether or not one contributes to the campaign fund. My colleague also pointed out that we-I think it was the member for Richelieu-had already introduced a bill a few years ago relating to party funding by the people. The Parti Quebecois for example is funded under this formula, in other words companies cannot make political donations, and the amounts individuals can give are limited to a maximum and the names of all people who contributed are made public.

We know that the Bloc Quebecois is doing exactly the same thing. Even if the law allowed us to do otherwise, we voluntarily agreed to restrict our fund-raising to the private sector, to avoid business contributions, and to solicit relatively small amounts.

I know that, like myself, my colleague is currently raising funds. We know what this means. It means that, night after night, we go door to door to solicit donations of $10, $15, $20 or $100 if we are lucky from the 200,000 members of the Parti Quebecois or the 100,000 members of the Bloc Quebecois until we reach the goals we have set for ourselves.

In this context, I would like to ask my colleague who knows about such things whether he feels like me that this fund-raising formula for political parties, which was never adopted and against which the Liberals voted-even those from Quebec who are familiar with the impact of this legislation in that province-increases transparency and allows people to buy their own freedom to a certain extent by helping fund political parties in this way.

[Department Of Public Works And Government Services Act, March 26th, 1996]

Mr. Speaker, I will share my time with a colleague.

I am pleased to discuss Bill C-7, which is the former Bill C-52. As my colleagues pointed out on numerous occasions during the previous debates on this legislation, the Bloc Quebecois' position is based, as with many other bills debated in this House, on the government's alleged transparency or, rather, on its lack of transparency.

During the last election campaign, the Liberal Party of Canada used its now famous red book as its book of promises.

But we know that the government has broken its promises more than once, and I give one example that comes to mind. Most of my Liberal colleagues campaigned on a promise of scrapping the GST, and we know what became of that promise. The GST is still with us, and it will still be around for the next election, where it may become yet another promise.

As the members on this side of the House take a malicious pleasure in quoting from the red book in order to remind the government of its broken promises, I would like to read from it two brief passages. The first is on page 92 and reads as follows:

In the House of Commons, a Liberal government will give MPs a greater role in drafting legislation, through House of Commons committees. These committees will also be given greater influence over government expenditures.

A little later, on page 95, we read:

We will take an approach of openness in decision-making.

These passages are short, but they speak volumes about the willingness of the government to keep its election promises. And yet, during the last election, transparency and the openness of the decision making process to all levels was a real profession of faith with the Liberals.

It is my contention that the government has failed, in Bill C-7 before us today, to put in place a mechanism for demonstrating the full transparency of the government. There is no longer any doubt that the government is making no effort to keep its promises, as can be seen with what happened to the GST. A point by point analysis of the bill confirms this. You can hear every note of the lullaby the government is hoping to lull us off to sleep with.

Let us keep in mind that the government opposed the motion we proposed on public funding of political parties. It was my hon. colleague, the hon. member for Richelieu, who proposed at the beginning of the session that the same thing be done in Ottawa as in Quebec City as regards public funding of political parties, so that the Liberals would no longer be funded by business, but rather by individuals.

To quote an expression that is very popular in Quebec, "He who pays the piper calls the tune". This government, this party is funded by major companies, banks, organizations of all kinds, to the tune of $25,000, $30,000 or $50,000. So the ties between these two groups are quite obvious. But it was the Liberals who campaigned with the promise of cleaning up Canadian politics by eliminating this rather questionable cronyism. Yet this government has demonstrated to us, unequivocally, its intention to preserve the privileges it holds with those who contributed to its campaign coffers.

The best example came very recently, in the last budget, when the Minister of Finance announced the creation of a technical committee on business taxation, at least five members of which had together contributed over $80,000 to the party's coffers. The entire question of tax havens is being studied by those who are themselves the heaviest users of them. Are we to conclude that the government adopted a transparent approach here? Hardly.

Let us keep in mind as well the famous bill on lobbyists. It was meant to make the relationships between them and the government more transparent. Here again, the Liberals bowed to the lobbyists, who managed to amend the bill aimed at controlling their own influence. Are we to conclude that the government adopted a transparent approach here? Hardly.

We know that the Department of Public Works and Government Services we are dealing with here is one of the hugest and most influential departments, controlling as it does the procurement of federal goods and services-we are, of course, dealing in billions here. It administers all contracts entered into by the government, and has one of the biggest portfolios around.

It is therefore up to the government to take all necessary measures to ensure that the money spent through this department is spent in accordance with our laws and regulations and, if possible, in a transparent way.

The Liberals promised members of Parliament that they would be allowed to monitor government spending much more closely. This is another red book promise. Well, it is in this very area that members of Parliament should get involved.

It would be logical, cost effective and desirable for us, the elected members of this House, to have the right to monitor this government's numerous expenditures, but this right is not spelled out. The federal government should follow the example of the Quebec National Assembly, which demonstrated how effective such a monitoring process can be.

Unfortunately, we must recognize once again that the government made some very nice promises that it has no intention of keeping. Today during question period, we talked about the appointment of census representatives. We are being asked to provide the names of people in our ridings who could help conduct the census but they will, of course, come after the priority lists drawn up by the department. So much for transparency.

Also, as elected representatives of the people, we have a right to find out about the money spent in our ridings. We have a duty to check if the expenditures ordered in our ridings by departmental officials are really justified. Otherwise, how can we know if they are useful? Should we not find out if these expenditures are legitimate? Is this not the reason why we were elected? Why should the people elect members of Parliament if we have no say in how taxpayers' money is spent? We might as well have only a govern-

ment and get rid of the opposition, because monitoring the government's spending powers is one of our basic duties.

It is deplorable that we as members of the official opposition have to raise this point, when we should be granted such a basic right without having to ask for it. As elected members of Parliament, we are accountable to the people so long as we have a say in public matters.

We are consulted, we are asked to vote on a considerable number of issues, yet we are denied the means to check in the field if the government's decisions are consistent with the recommendations made and legislation passed by this House.

Of course, elected members have the power to question the government on all public expenditures. But how can we carry out in good faith our duties in this House without the means to really find out about the activities of the federal public service? That is the basic question.

There is another point to consider: the accountability of our officials. As you know, the federal public service is the largest employer in Canada. Day in day out, public officials make decisions that have or could have financial implications. The costs involved, as minimal as they may be individually, add up to a huge amount.

In times when we have to put our fiscal house in order, it is imperative that we get a grip on government expenditures. And I will remind you that, at the very beginning, the Bloc Quebecois asked that an ad hoc committee be established to review government expenditures, item by item, but we never got an answer on that.

The public administration must conduct a self-examination to assess the expenses incurred by the various departments, including the one at issue today, namely Public Works and Governmental Services Canada.

As I said earlier, this department handles most of the federal government's goods and services procurement contracts. We must therefore make sure that it does not make any excessive or unnecessary expenditures. Judging from the auditor general's report, year after year, I would say that many expenditures are questionable.

The Bloc Quebecois had suggested putting in place a system whereby public servants could blow the whistle on squandering. If implemented, that solution might result in significant reductions in government spending in the short, medium and long terms. As for the public servants who oppose that measure, they should be told the facts. They should know that it is in their best interest to participate in this type of exercise if they want the government to rely more on them, instead of contracting out. It would also be in their interest to participate, because budgets are being reduced and departments must face cuts, because of the ever increasing deficit and debt. This is not very reassuring in terms of their long term job security.

As regards contracting out, over the last few years, there has been a definite trend showing that the federal public service is relying increasingly on that process.

The government contracts more and more outside the public service. If it results in savings for the government and, indirectly, for taxpayers, and if it stimulates the private sector, so much the better. However, we should be able to know for sure that it does not promote patronage and the awarding of contracts to friends of the government. This is why much greater transparency is required and why opposition members, regardless of their allegiance, must have much more direct access to information.

The total figure for such contracts from the Department of Public Works and Government Services is several billion dollars every year. Such a level of spending should be subject to clear and fair guidelines. The stakes are too high for federal public servants, contracting firms and Canadians.

The government will soon have to tell us what it intends to do about the contracting out process. It had a chance to do so with Bill C-7, but it did not. I cannot understand why the government did not take this opportunity to innovate. Measures must be taken to avoid the wasting of public funds. The government probably thought that we would turn a blind eye on that bill, since it is supposedly just a bill establishing a new Department of Public Works and Government Services.

We see nothing in this legislation that will make the contracting out process more transparent, and that will make us, members of Parliament, more responsible, since we do not have the necessary information.

With this bill, the government distances itself from its election commitment and its red book promises. It distances itself from its obligation to ensure maximum transparency in all its activities. We will continue to strongly condemn that as long as we are in this House. If the government is afraid to give greater transparency to its actions and decisions, then it is hiding things from the public.

If the government has things to hide, then it is doing things that it should not be doing. We have no choice but to come to that conclusion. Some day though, we will know what is going on with this government.

[Canadian Armed Forces, March 22nd, 1996]

Mr. Speaker, are we to understand, in light of this other disgraceful incident that reflects poorly on the reputation and credibility of the Canadian Armed Forces, that the minister did not draw the obvious conclusions from the events in Petawawa, and that he was unable to get his defence staff-because that is what is now in question-to take the action necessary to avoid other unfortunate events of this sort?

[Canadian Armed Forces, March 22nd, 1996]

Mr. Speaker, my question is for the Minister of National Defence.

While the military police are investigating initiation rituals in poor taste at CFB Gagetown in New Brunswick, we now also learn that two officer cadets are facing court martial and that eight others were apparently found guilty of harassment for their participation in other hazing incidents that took place at the same base last June. One cadet was apparently even tortured and beaten by his colleagues.

How can the minister explain that his directives against hazing are not always respected, and what excuse can the minister give the House this time?