In the Chamber
Click the links below to review past speeches/statements I have given in the Senate.
Third reading of Bill C-4, A second Act to implement certain provisions of the budget tabled in Parliament on March 21, 2013 and other measures
Hon. Joseph A. Day: Thank you for the tag team, Senators Buth and Smith from the other side, and I congratulate both of you on your presentations.
Honourable senators, we are, as has been pointed out, dealing with budget implementation bill number 2, and that has been before us now for three days. You will recall that yesterday we had a debate in relation to the report that our committee did on a pre-study of the subject matter of the bill, and that was how, by having done that pre-study, we were able to deal with clause-by- clause consideration much more quickly.
I've already thanked the staff who helped us with that work — it was very intense for a period of three or four weeks — and Senator Buth has done likewise. I would like to echo her comments on all of the team that helped support the committee and also to thank all of the committee members for giving up other items, including items here in this chamber, which was necessary in order for us to meet the many times that we met in relation to this particular matter.
So we have the report, and that outlines what our committee did. As Senator Buth mentioned, six other committees of this chamber looked into different aspects of this bill. And if you look at your Order Paper for today, page 4 under "Reports of Committees," the six numbers there are the six reports of the committees dealing with sub-items.
The overall Finance Committee's report is not on here, because that has been adopted by this chamber. These other reports are still there, they're available for you to review, and I would highly recommend that you do so. It will help you understand in more detail some of the items that were looked into by some of the committees.
We couldn't possibly, in the time available to our committee, deal in depth with these various matters because this is a budget omnibus bill. I've spoken at length on my dislike for this, and my dislike is primarily in defence of all of us. I think it's an affront to us to have to deal with these time after time. I'll have more to say on that shortly.
Let me just briefly talk on some of the items, and perhaps this may prompt one or two honourable senators in the chamber to deal in more depth on that particular item, such as the discussion that we've just had with respect to Senator Dallaire's expanding on one of the items we talked about in the previous bill for lapsing some National Defence funds under the supply bill.
Here we are under Bill C-4. The observations I mention are my own observations unless I state otherwise; they are points that I have observed.
The labour-sponsored venture capital funds, t is a corporate tax credit that is being discontinued. You should be aware of that, that the government has decided to discontinue that particular program. Many people had invested in that, and many organized labour units had been promoting the venture capital fund concept that has been around for a number of years.
Honourable senators, the government made a policy decision on credit unions earlier this year, and we dealt with that in Bill C- 60 in June. We dealt with it believing that what we were doing was following government policy. I didn't vote for it, but we dealt with it and it was passed. The clause was intended to take away the federal corporate tax advantage for credit unions because they operate in smaller environments, have more expenses and make less profit than they would otherwise. That credit was being taken away. Those small business entities, and the majority of them by far are still small businesses, would be paying the small business entity tax rate of around 14 per cent to 15 per cent. But in fact, what we did by virtue of the wording that appeared in the bill was move the tax rate up to 28 per cent. We moved it from 11 per cent, where they were, to 28 per cent. That was for credit unions. As it became apparent, this bill is correcting an error that we made because of hastily dealing with that item in a previous omnibus bill.
Senator Mitchell: An error they made.
Senator Day: If we had dealt with fewer items, that particular error would have had a much better airing and a much better in- depth study; and we would have found that problem. But we didn't, and here it is.
Another one that seemed to come up quite a bit in Bill C-4, which had not been brought to my attention in the past, was the matter of comfort letters. That's an interesting term — I think of the Second World War. These comfort letters are quite common, we found out from the Department of Finance. We asked some questions about what they are. The chair asked:
Do they give comfort to the taxpayer that the scheme that they're proposing is okay until the law changes, so be uncomfortable that this is coming down the line?
Mr. Cook replied:
Actually, it's the opposite. A taxpayer wants to enter into a transaction that might technically fall afoul of the law. Having seen the transaction and the fact that it fits within our conception of what the appropriate tax policy is, we will issue them a letter saying that we're going to make a recommendation to the Minister of Finance that this relieving change that would permit that transaction to take place as intended will be made and we'll recommend that it apply as of the date of the comfort letter.
In general, taxpayers and Canada Revenue Agency will both file; the taxpayer will file based on the comfort letter and CRA will generally administer based on the comfort letter.
In effect, a comfort letter is the department interpreting the law in a manner that will require a change in the law and saying not to worry. They don't have to wait for Parliament to speak on this; they don't have to have parliamentary approval; they will just deal with this based on the comfort letter. Then they will put it in an omnibus bill so nobody will understand what's going on anyway, and it will become law retroactively to the date of the comfort letter. That's what's going on, honourable senators, and apparently it's quite a common practice that hadn't been too well known to me until we got into this matter.
Part 1 also deals with the Scientific Research and Experimental Development tax incentive program. This is another area that I think we will hear about again. I'm not comfortable with the wording in the bill, to start with, and I'm also not comfortable that the industry will be happy with this particular provision. It will make the person or company who prepared the report on behalf of the organization or company that got the grant from the government file a report. Typically, an accountant and auditing firm would do that for a research institute, or it might be someone within the organization. The person who prepares the report will be jointly and severally liable personally under this bill. I think as soon as people realize and the auditing firms and accounting firms become aware of this, they will not be happy with the provision.
One clause says that a claim preparer of the SR&ED form is not liable for a penalty in respect of false statement or omission if done properly or in such a manner so as to prevent the making of the false statement. That wording causes me concern because if it was done in such a manner so as to prevent the false statement or omission from occurring, then the false statement or omission would not have occurred. It's not to a reasonable standard but to the standard of not having happened. I asked government officials about this drafting, but we've heard nothing back from them in relation to that particular wording.
Another area you should be aware of is in relation to mining. Canada is a world leader in mining. Canadian Exploration Expense, CEE, will now be done away with. A Canadian Exploration Expense deduction was 100 per cent deductible and could be carried forward indefinitely. Money that was expended could be deducted from any profit made. That was important for creating an incentive for new exploration and mining, for example in the Bathurst area and in the Sussex area of New Brunswick for potash. These important deductions will be done away with. The proposed Canadian development expense will be available for companies that go to, for example, Schefferville, Quebec, to start up new mines. The Canadian development expense will be a 30 per cent deduction on a declining basis. That is a significant change from 100 per cent deductible. We may hear more from the mining industry on this one in the future.
There is an interesting clause in Part 2(b)dealing with GST and HST. For many years, since the Goods and Services Tax was created in 1990, municipalities that ran parking lots maybe just charged a small fee to cover the expenses of attracting people to the centre of town. The municipalities were of the view that they didn't have to charge GST with respect to that. They have argued that since 1990. There is now a change in the law, and the change is to make it clear that, if they do charge generally for parking in a parking lot, then municipalities will be responsible for collecting and remitting the GST. However, this is retroactive to 1990.
Senator Mercer: Holy cow!
Senator Day: The government says, "No problem. We've always taken this position, so we're not changing the law. We're just clarifying the law." 1990 — you can imagine that some of these municipalities will have to try to refile documentation and find funds to meet that. That is one that I thought you would be interested in.
Honourable senators, there's another section that you should be aware of, and that is with respect to Employment Insurance.
Every year, there's a different scheme. There was, for a period of time, a group called the Canadian Employment Insurance Financing Board. There were going to be people appointed to the board, and they were going to administer this separate fund. It was going to be treated like an insurance policy. The government has now moved back to where it was previously. We have done away with the Canadian Employment Insurance Financing Board. There will be a fixing of the rate, on an annual basis, based on a seven-year going forward program. This will be done by the government, but nothing will happen for three years. This legislation will freeze the rates as they are now for three years.
The Parliamentary Budget Officer looked into the current rates and said:
The fiscal impact of keeping premiums artificially higher for two additional years —
— that is for the next three years —
— is that it will contribute $1.8 billion to the 2015-16 surplus and $3 billion to the 2016-17 surplus...
What is, in effect, happening through this freezing of the rate is that the government will use it as a hidden tax to help balance the budget. You can see it coming. There are clawbacks in different departments, and now we have another one of these. There is the selling of assets in different places. All of this is building up a little bit of a surplus so that the government can go into the election year saying that they have a balanced budget. That is beginning to become clear.
The Veterans Review and Appeal Board is another area we talked about. That has been debated here previously, so let me just give you a quick review. There were 28 members on the board. They have a huge backlog in reconsiderations that they are not dealing with now, but they said that that was because they only had 22 of the 28. They said that they could live with the government-proposed 25, if they would fill up the 25. Then, they would get working on the backlog.
I say why not not change the law? Fill the 28 slots that are there and deal with the backlog and, if we find that there are too many people working there, then we can reduce it at that time. To suggest that the way to deal with a backlog is to reduce the number of authorized members on the board seems to be counterproductive, from my point of view.
Those with the Veterans Review and Appeal Board seem to be saying that, if they can get up to 25, then they are prepared to give away the other three positions. It's like we said yesterday about the museums. We won't get what we need, but we'll get something, so let's take that. If we don't take that, we won't get anything. That seems to be the mentality developing here.
The Canada Pension Plan Investment Board. It says "no more than three." There weren't any before. The Canada Pension Plan Investment Board can now have three directors who are from outside of Canada. That's a new provision that wasn't there previously.
I am almost finished on these little highlights, honourable senators, but I did want you to be aware of these because you will be voting on this.
Division 17 — I spoke two days ago on that division. It is the Public Service Labour Relations Board and the entire method of dealing with labour relations in the public service. The most fundamental issue here is that it shouldn't be in a budget implementation bill. It is an act on its own. It's a fundamental change of labour relations, and there was no consultation with the labour unions. Now everyone is reacting to this very complicated change.
In our report, we asked the government to give us, when they were before us — and I think it was Treasury Board that did this for us — an analysis of what was there, the changes and what the effect of them will be. That analysis is very helpful. I recommend that you may want to take a look at that. There are two schedules at the back of the report from Finance on that particular matter. This is entirely on its own, an all-new scheme of handling things.
One of the most important things is that the minister can now decide what is an essential service. The minister decides himself or herself what is an essential service. They said, "Oh, we'll take that authority you are giving us. We'll use it very sparingly and not to worry." It is another one of those "Give us all the power, and you can trust us." Give us the power, and you can trust us.
The final article is Division 19 of Part 3. Part 1covers income tax; Part 2, excise tax; and Part 3, other measures. There are 19 other measures. In the 19 other measures is the Supreme Court Act, that issue where we are changing the law. First, the government says that they acted within the law. Then they come forward and try to change the law. Then they do a reference to the Supreme Court of Canada, all with respect to the slots in the Supreme Court of Canada reserved for lawyers from Quebec.
If they were within the law, why don't they just do it and wait for a challenge? If they needed a reference, then why did they go ahead and make the appointment? If they needed a reference, why are we dealing with the legislation? I think that is the issue that I put to you there.
Honourable senators, I've been searching for what we should do, because the most important part of all of this, in my view, in dealing with these matters, is the omnibus aspect. We can do the job and accept government policy change. We know that happens. It's the government prerogative, because the people gave them that and we respect that. We just want to make sure that there are no unintended consequences and what the effects of these proposed policy changes are.
However, when you get all of this put in — with 19 different divisions, over 300 pages — when you get all of that together, we are just not doing the job that we were intended to do. All of us. This isn't just an opposition role; this is all of us.
Now, in the past I've suggested that because these are finance related, there is no prior consultation, like we saw with respect to the labour relations. They said there's no prior consultation because it was part of a budget bill — and there should have been, and there still should be. So what can we do about it?
I had suggested in the past that a number of options are available to us: Divide the bill into coherent parts and deal with them separately, allowing committees to do their job properly. We started by dividing this bill into seven different committees here, but then only one committee does the clause-by-clause consideration; only one committee is then reporting back fully on the entire bill. So we could have gone further and had each of the committees that studied portions of this bill report them back, have a debate, and then we could have voted on those clauses. That would have been more meaningful, but we didn't do that.
The second possibility is to delete all non-budgetary provisions and proceed to consider only those parts of the bill that are budgetary in nature. I contemplated — in fact, I've got it in my hand — an amendment that would achieve that. You know that I've done that in the past. I don't intend to proceed with that at this time. I've done a lot of thinking about it, but I think that we need some sort of consensus in this chamber as to how we're going to deal with this in the future.
So I won't proceed with this proposed amendment, but I'm hopeful that before one of these happens again, we will be in a position — and the next one is likely to be in May or June of next year — to say, "This is what we, as a chamber, are going to do if you send us another one of these." I don't care what government is in power at that time; I think we should all agree that this is how we're going to handle this.
Some Hon. Senators: Hear, hear!
Senator Day: There are some other possibilities. One of them is to defeat the bill at second reading on the grounds that it is an affront to Parliament. This is called a reasoned amendment.
Another possibility would be to find the Minister of Finance in contempt for participating in a practice that the Senate has denounced. If we pass a resolution here denouncing that, and they continue, then we would be in a position to do that; or to establish a new rule of the Senate prohibiting the introduction of budget implementation bills that contain non-budgetary matters.
There are a number of things that we can do, honourable senators, and I'm hopeful that over the next few weeks and months we will find the right consensus and the right way to deal with these, because we're not doing the job that we should do on these bills as they are presented to us now.
Some Hon. Senators: Hear, hear!
Hon. Jane Cordy: Will you take a question?
Senator Day: Yes. Thank you.
Senator Cordy: I heard you speaking about the section dealing with the changes to safety within the workplace. The definition of "danger" is changed within this finance bill or omnibus bill, as you've clearly stated, and I believe it should have been in a labour bill.
You rightfully stated that there was no consultation. In fact, when the groups appeared before the Social Affairs Committee, we asked both labour and employers and employees whether or not there was any consultation, and they said no.
When we had government officials before us and I asked them the same question, whom they had consulted with, they said, "Well, this is a budget bill, so we cannot do any consultations for a budget bill."
In fact, when we talked to employers and employees, they said that they definitely could have gotten together and come up with a definition of what "danger" would, in fact, be.
Do you believe that it is fair to workers in the workplace that a section such as this is put in a budget bill, which can have no consultation; they can have no input into it; and it comes as a fait accompli — done, drafted by the government?
Senator Day: You're absolutely correct in relation to no consultation and the argument for that. Therefore, here we have a change. "Danger" is important and the definition of what might be dangerous is important because an employee who feels that the employer is requiring that employee to work in a dangerous location, something that could interfere with his or her health, they can refuse to work there until it's rectified. There used to be safety officers who would come and inspect that and make an adjudication. That role is done away with. It is now the minister who will make a decision on this.
Secondly, the definition of "danger" has changed — all without any consultation. Now it has to be an imminent, almost likely to happen, situation. At first blush, the employees, the tradesmen, are looking at this and saying, "We also had that situation, and we may be exposed to things like asbestos. It's not an imminent danger to my health, but it could, over the long term, have very serious ramifications to my health." Is that now excluded?
These are questions that we don't know the answers to because there's been no consultation and no debate; it has just been foisted on or we're about to foist it on the industry.
Senator Cordy: You have questioned whether or not the government actually put it in a budget bill so that there would be no consultation. I think that's basically what you were saying.
I have another question. I know we've talked about the missing amount of over $3 billion. In all of your discussions over the past few weeks is there any sign of this money that the government has lost, or is it still lost somewhere?
Senator Day: If it has been found, nobody has told me about it.
Senator Mercer: I guess the new definition of "dangerous" is that as the train is going off the cliff, they will say, "Oh, that's dangerous."
I want to ask my colleague a question about this attack on municipalities and what I would say is the raiding of the municipal tax money. Senator Eggleton may have a good answer to this question.
How much money is this going to cost municipalities when you're going to retroactively go back to 1990 to collect GST on parking fees? These guys have got a good friend in Mayor Rob Ford. He's their buddy. Their Prime Minister has been seen in many pictures with Mayor Ford, and I think you may see more copies of the pictures of him with Mr. Ford sometime in the future.
What is their friend Rob Ford going to say when the government delivers to him a bill that will be in the millions if not billions of dollars because the City of Toronto operates dozens and dozens of municipal parking lots? Having lived in Toronto for eight years myself, I used to use those municipal parking lots and the park-and-ride to get to the subway and then go to my place of employment. What is the Mayor of Toronto going to say?
What is the Mayor of Calgary going to say? Because they operate some of these.
I know what the Mayor of Halifax is going to say. He's going to say he's not very happy. I can't speak for any of the others, but I know that Mayor Savage in Halifax will not be a happy camper.
It would be interesting to hear what Mayor Ford says when the Tories come robbing the bank account of the City of Toronto.
Do you have any estimate, Senator Day? How much money are they taking out of the municipal coffers?
Senator Day: I don't have an answer to that question, but I can tell you we started to get into that, and we were told that most municipalities have already paid the money. They knew that the penalties and the interest would be so overpowering, they paid it under protest. That is the answer that we got from the government people. But the amount, we weren't able to get into that with them, no.
Hon. George Baker: A very important point was raised by Senator Day. I'm wondering whether he has considered the solution that has been accepted by most parliaments in the world to solve the problem. I am referring to the fact that this is an omnibus bill and that no matter which political party is in — the Liberals or the Conservatives — we still get this problem of having a mixture of budgetary items and then matters foreign to the budget included in the same measures.
There was representation, as you know, to your committee through the Standing Senate Committee on Legal and Constitutional Affairs by a couple of university professors, who pointed out that this is unlawful in Britain. The Erskine May rules, which are at the top of our Rules list — if our standing orders don't apply in a matter, we go to Beauchesne, and if Beauchesne doesn't solve it, we go to Erskine May. Erskine May says that having foreign matters in a budget implementation bill is unparliamentary and unlawful.
Now, the reason why it was solved in those legislatures — the problem — no matter what party is in — I mean it is of no consequence that we pass a measure here. The professors pointed out that it is also unlawful to amend a budget implementation bill. It is unlawful. It is against the rules.
Those legislatures appointed an outside advisory committee made up of members of the press gallery and professors of political science to recommend changes to the rules of procedure in the Commons and in the House of Lords, in that case. The recommendations came through and those things were solved. In other words, the professors said, "If you leave it to parliamentarians here in Ottawa, it will never be solved."
You listed six ways this could be solved. Have you turned your mind to a solution perhaps being found in asking for an impartial committee made up of members of the press gallery in Ottawa and political scientists to recommend changes to the procedures in the House of Commons and the Senate to address these very questions and other important matters that we need corrected?
Senator Mitchell: Good idea.
Senator Day: Thank you, Senator Baker. I hadn't turned my mind to the type of inquiry that you've suggested, but my mind is turning.
Senator Tkachuk: But you will, though; I am sure you will.
Senator Day: I appreciate it, and I hope my colleagues from Finance were listening, because that seems to me to be an area — when there are several options, then we have to discuss and consider all of the options. We can't do that in this chamber as a whole, so it should be by a committee.
Your suggestion is very good. I will bring that up to the steering committee.
Before I finish my answer, one of the committees had received from the Canadian Bar Association a letter back in relation to Bill C-4. This was in relation to the labour and employment law portion. They pointed out that the Canadian Bar Association represents over 37,500 practising lawyers in Canada. They commented:
The CBA has steadfastly objected to omnibus legislation like Bill C-4. Enacting important changes in diverse and unrelated subject areas in a single bill precludes meaningful comment and debate.
That is a quote from the Canadian Bar Association in a letter dated November 18, 2013. It was sent to Senator Ogilvie and me. That's just another example of a very influential group that was saying, "You're not doing the right thing."
Hon. Joan Fraser (Deputy Leader of the Opposition): Colleagues, this is an extremely important bill, and I believe it is profoundly important for everyone who wishes to speak on something as important as a budget bill — let alone one with as many complications as this one — to be able to do so.
But I am also aware that we are expecting His Excellency at 5:30. So I wonder if I could, without offending any colleagues, ask that in order for all those who wish to speak to be able to do so before His Excellency arrives, if those who do wish to speak could try to be as concise as possible.
This is an extremely important bill. Any senators wishing to speak on this subject should and must have the right to do so. However, to give everyone an opportunity to speak, I think it would be very gracious of all senators to speak as concisely as possible, even if just for the sake of "fair play," if I may put it that way.
Some Hon. Senators: Hear, hear.
Hon. Roméo Antonius Dallaire: I wish to bring a point of clarification regarding the Veterans Review and Appeal Board. Now there are 29 members, not 28. One is the president and then 28 adjudicators. They are reducing it to 25, which is really 24 and one.
They have kept it at that level for a number of years, but the department is funded for 29. So when they are doing the budget cut right now, it is simply taking money that they have been using to do other things to now throw into the pot as their sort of portion of whatever the budget cuts are, and they are going to have to adjust accordingly.
The difference, however, is that these Governor-in-Council appointments take time to be appointed. The average number of adjudicators qualified — not the number of bodies, because you get somebody in the pipeline, and you finally get it approved and that takes four or five months, and then you have a five- to seven- month training period before they are actually being used. So you have at least a year.
You hold, generally speaking — because they have three-year terms — you're holding five to six who are not necessarily effective. So instead of having 28 functional, they have been operating with 24 plus one as a number, but, in fact, they are really down to 18 who are actually working.
They have a half hour for people to adjudicate. They have these people running ragged. They are going across the country, and they are producing a less-than-effective job, but more important, there is a whole raft of cases waiting up to a year and so on.
The point is this: Why did they, one, not increase the number of adjudicators to meet the requirement, and, two, now emasculate that body even more by guaranteeing that there will never be more than 18 to do the job of originally 28?
Senator Day: Thank you, Senator Dallaire. Really, the question you ask is the question I asked. We heard from the chair of the board, and he seemed to be saying, "Yes, well, this is the only opportunity we have to get anything, so we will take 25." But then he talks about dealing with the backlog of 300. They dealt with eight of them last year.
The Hon. the Speaker pro tempore: Senator Mitchell, three minutes remain on the time of Senator Day.
Senator Mitchell: Honourable senators, my question relates to the process the government is using to try to balance the budget.
I am quite suspicious that they are using a process where they are utilizing a great number of one-time elements — for example, the sale of real estate at hundreds of millions of dollars, and the failure to spend certain lump sums of money one year but perhaps, in subsequent years, that money will be spent.
I am wondering whether there is some calculation, Senator Day, of how much of the balancing of this budget — the reduction of the deficit — will come from one-time, non- repeatable kinds of elements, such as the sale of real estate, which you can only do once.
Senator Day: Our committee obviously doesn't have the resources to do that, but the Parliamentary Budget Officer might. That could be a very interesting study for the Parliamentary Budget Officer for us.
The Hon. the Speaker pro tempore: I think we have time for a question. Senator Downe.
Hon. Percy E. Downe: I'll be very brief.
This Veterans Review and Appeal Board is extremely disturbing given the tremendous backlog. They used to have a certain number of set members, 28, 29, then they used to have unlimited temporary members up to two years. Do they still have the unlimited temporary members and, if so, why are they not appointing people?
What we used to do is appoint previous members who were off the board. They didn't need the training; they already had the training. They came in and started work right away. They were appointed for two years, a large number of them, maybe even some who were appointed under the Liberals to clean up the backlog.
Senator Day: We got into the discussion of the temporary members. None have been appointed. The provision is still there, I think, up to 10. The chairman would like to see appointments made there, but the government hasn't seen fit to make them. [...]
Appropriation Bill No. 4, 2013-14—Third Reading
Hon. Larry W. Smith moved third reading of Bill C-19, An Act for granting to Her Majesty certain sums of money for the federal public administration for the financial year ending March 31, 2014.
He said: Honourable senators, I think that we have exhausted the subject of the Supplementary Estimates (A) and (B), so with your indulgence —
Hon. Joseph A. Day: Not quite exhausted.
Senator Mercer: Now we are getting to the truth.
Senator Day: But I can tell you that we are getting very close to the end on this particular matter, and I thank all honourable senators for your indulgence and understanding regarding the process of supply.
I think it is important that we be reminded about what we are voting on. This is a bill for authority for the government to spend $5.4 billion.
Senator Mercer: Wow!
Senator Day: I think that should not go without being commented upon.
Honourable senators will recall that this was the subject matter of Supplementary Estimates (B) and that we looked into Supplementary Estimates (B) at length in the Finance Committee. We generated a report that was filed, debated and adopted, so it is now part of our record. It outlines some of the major departments that we had and called to come before us in the committee to consider why they were asking for the funds.
Supplementary estimates fit into the overall estimates scheme: Main Estimates, Supplementary Estimates (A), (B) and (C). There should be some reason why they were not part of the Main Estimates. The typical reason we need supplementary estimates is the full amount of the request and the program hadn't been developed when the Main Estimates were prepared. That is why we have the supplementary estimates later.
Typically, this would be the largest of the three supplementary estimates. The supplementary estimates in January, which will be Supplementary Estimates (C), will finish out the year with the government departments that need an amount of money to finish a program for the rest of that fiscal year.
The messages that I want to leave with you are that there are some departments that now have two-year approval. As opposed to the majority that have one, departments such as Border Services and Parks have two years of appropriation, so they can spend their money over a two-year period once we approve it. We talked to the Department of National Defence and to Infrastructure Canada because they had so much that had lapsed. You will recall — and we talked about this yesterday — that they couldn't or didn't spend the money within the year, and they blamed it on a number of factors. They may wish to consider and we may wish to consider recommending a solution to that. One possible solution is a two-year appropriation, but one of the difficulties is that we when we are approving, we cannot predict what is likely to be spent during the year. We approve a particular amount, and then the government comes back at the end of the year or during the review after the year is over, and we find out a lot of the money was not spent and we have to approve it again next year. We keep going through that cycle of reapproving funds because they weren't spent in the year they anticipated them being spent.
Honourable senators, the other important thing that I wanted to mention to you was that Schedules 1 and 2 at the back of this bill are the same schedules that are in the supplementary estimates. There is an explanation in the supplementary estimates in Part 2 of these expenditures, but then there is the schedule itself. That schedule is lifted out of here and put in Bill C-19. It is the same wording in the preamble and in the earlier part of the bill, the same wording in these supply bills, and then the schedule is attached. That schedule is what came out of the supplementary estimates.
I have compared those two. It is $5.4 billion that is being requested, and the departments that are involved are listed in Schedules 1 and 2.
The Hon. the Speaker pro tempore: Senator Mercer, a question?
Hon. Terry M. Mercer: Would the honourable senator accept a question?
Senator Day: Yes.
Senator Mercer: Can you give us some background on this two- year budgeting program for Border Services and Parks Canada? Is this a norm? Has this been going on for a number of years? If so, do you have an idea of how many?
Senator Day: Thank you, Senator Mercer, for your question.
I pointed out to you this Schedule 2 because a lot of people don't notice that because it is quite small compared to Schedule 1; in fact, there is $5.3 billion in Schedule 1 and about $111 million in Schedule 2 over two years.
That has been going on for some considerable period of time. I can't tell you when those two departments began receiving a two- year supply. In other words, they can spend the money over a two-year period as opposed to having to deal with it over one year and coming back or getting permission to carry it forward.
Senator Mercer: Two years doesn't allow you to judge from year to year whether the department is successful.
You also mentioned, in your brief remarks, the amount of lapsed money that gets turned back in every year, particularly in programs like National Defence where commitments are made year after year to buy equipment, and then year after year, I guess the good news from the government's perspective is that the next year they get to announce the same project again and that they are going to spend this amount of money on ships, airplanes and close-combat vehicles, but they never have to deliver. They keep promising but do not deliver. Am I correct there?
Senator Day: There isn't necessarily a tie-in between government announcements and what appears —
Senator Mercer: Help me, Joe.
Senator Day: — in the supplementary estimates.
The estimates come forward based on what the government actually is asking to spend. One perfect example is the shipbuilding strategy. We have seen in the documentation over the last two days the amount of money actually being requested is a small amount of what had been announced as being expended. That small amount is for preparing the yards and preparing the plans. No steel is being cut or ordered; no people are being hired to start work on building ships. We'll see that in future estimates, I hope. [...]
Third reading of Bill C-7, An Act to amend the Museums Act in order to establish the Canadian Museum of History and to make consequential amendments to other Acts
On the Order:
Resuming debate on the motion of the Honourable Senator Eaton, seconded by the Honourable Senator Ataullahjan, for the third reading of Bill C-7, An Act to amend the Museums Act in order to establish the Canadian Museum of History and to make consequential amendments to other Acts.
Hon. Joseph A. Day: Honourable senators, I wanted to go on the record with a few words and comments in relation to Bill C-7.
Honourable senators will know that Bill C-7 is directed towards changing the name of the Canadian Museum of Civilization to the "Canadian Museum of History."
The bill goes further than that, honourable senators. It's not only a name change. A name change is one thing, and you've heard Senator Eggleton suggest an alternative name but the bill goes further than that in changing the mandate. It's in relation to changing the mandate that I have some unease, and I just wanted to go on record.
I'm not certain that I have done enough background research on this matter to have a definitive position. I've heard both sides of the argument as to whether this legislation is needed or desirable, and they're both strong. Honourable senators, let me tell you what I've learned.
One of the first points that I wanted to make is why such haste in relation to this matter? I see where the bill received second reading. We literally had second reading speeches completed one half hour before the committee met to consider the matter, and then the next day the bill was done at clause-by-clause, and now it's back here again.
Now, this is an initiative that the Government of Canada announced approximately one year ago. But if you look at the progress of the bill, first reading was given in November 2012, about a year ago; second reading, not until May 2013; referred to committee in June 2013; and received third reading on November 6, 2013. The House of Commons had a year to think about the issues involved here, and now we're trying to deal with this bill in a few days.
If everybody was of the same point of view on this legislation, I wouldn't be concerned about that haste. If the House of Commons had done an extensive amount of research and listened to the various points of view, that's one thing. But if this bill slowly moved along and the debate really didn't have a chance to develop, then we, as parliamentarians, may not know what the issues are.
I have a great deal of respect for Victor Rabinovitch, who was the chief executive officer of the museum for approximately 11 years. He is very concerned about this piece of legislation and believes it's not necessary, nor is it desirable.
I have an equally great deal of respect for Mark O'Neill, who is the current chief executive officer. In fact, when this legislation came up and I was contacted by a number of citizens, I went over to the Canadian Museum of Civilization and I met with Mark O'Neill to discuss the legislation. He explained to me that they are moving ahead; there are six different committees for six different time periods that they're trying to work on. And he's excited about this $25-million project.
He worked under Victor Rabinovitch for a good number of years. So, right away, we have two CEOs whose points of view are not shared; in fact, they are opposite one another. And I think that, as parliamentarians, before we pass this legislation, should have a good sense of which one of these two points of view is the one we should follow.
Now, the mandate, honourable senators, is more than a name change. The mandate seems to be changed to try and make — and this is my own interpretation — to try and make this museum of Canadian history more of a practical chronology of what has happened here in Canada.
Dr. Granatstein is quite excited about that. He is a well-known historian. He is quite excited about it because he likes that chronological development of Canadian history. One of the arguments is that we haven't done anything for 20 years now; there hasn't been any sort of a new extension at the Canadian Museum of Civilization.
But maybe we were trying to do two different things here. The Canadian Museum of Civilization wasn't intended to be a museum of history. There are, as Senator Joyal has pointed out, many nations of the world that are in the process of creating — or have recently created — museums of history for their nations. That was promised back in Prime Minister Trudeau's time.
The Canadian Museum of Civilization was to be a wonderful centrepiece, and indeed it is. As Senator Joyal pointed out, many people have visited it. It's obviously a popular spot. The architecture is copyrightable; it's so distinctive in its features that it stands out. But it's not a museum of history. It was intended to be another museum of history. That never proceeded.
There was another purpose that is being touted for this change in mandate, and that is to show the relationship of the Europeans and other settlers that came here with the native peoples. That was promised in another museum during Mr. Trudeau's time as prime minister, and that particular museum never proceeded, either. So there are two other promises and two other plans that were to complement the Canadian Museum of Civilization that never happened.
Now what we're seeing, I'm afraid, honourable senators, is an attempt to achieve one of those promises that wasn't proceeded with 20 or 30 years ago — to achieve that by converting something that has been extremely popular in its own right, and that is the Canadian Museum of Civilization. Is that desirable? That's really what we should talk about.
There have been suggestions that there may be the opportunity for more political interference with this new mandate. I've heard from Mr. O'Neill and others that that just can't happen with the legislation as it exists. But I also read the transcript of the Canadian Association of University Teachers, members of which appeared before the committee, and they are concerned that there could be such an opportunity. It's been pointed out in various articles the attempts at changing the advertising and the promotion with respect to the War of 1812 or 1814, and the Privy Council Office's interference with respect to the work that was being done there and trying to change, in effect, Laura Secord into Little Red Riding Hood, because that would be much better promotion. And that's one of the points that was made by some of the witnesses at committee.
So there are current-day examples of interference with respect to the curator's attempt at running the museum. That concern is being expressed by a good number of witnesses, including Victor Rabinovitch, the former CEO, as I pointed out. That concerns me. I would like to have the opportunity to get to the bottom of that.
I know that when the Canadian Museum of Civilization was under construction, Douglas Cardinal, who was the architect, pointed out that there was a difficulty because the government changed at the time this was being constructed. It was begun under Pierre Trudeau and continued under Mr. Mulroney. And Cardinal felt that the whole project was going to fall apart at that time, because the new government didn't share the vision of the previous government that Mr. Cardinal had developed with them. He credits Joe Clark, who would then have been the Minister of Foreign Affairs in the Mulroney government, for bringing this back together and helping to get that completed.
Now, Cardinal would have been a very good person to have before the committee to explain, because he knows what the vision was for this building. He knows there was going to be another Aboriginal building on Victoria Island — a peace and healing centre, it was to be called. He knows that they didn't proceed with those, and he's still anxious that they are proceeded with.
But, unfortunately — or fortunately for some, I suppose — Mr. Cardinal has been hired by one of the contractors to do work on the new Canadian Museum of History, so he would not be available due to conflict of interest to talk to us any longer about this.
Senator Moore: Of course.
Senator Day: That is kind of an unfortunate change of events that has resulted in this just not allowing us to get to the bottom of this rather major issue.
So what we have is a wonderfully successful Canadian Museum of Civilization that appears to be getting converted into something that was promised previously — something that Canada should have — but do we really want to do that? Do we want to take away what we have to achieve something that we'd like to have? That really seems to be the issue.
I get the sense from talking to some who are supporting this particular project that the $25 million that has been pledged by the current government — and there are many who have said that is not nearly enough to achieve this new vision — but the $25 million — and it's not open-ended; it's "$25 million; do the job with that." I get the sense that, as Senator Joyal has pointed out, any museum requires refurbishment, updates and rearrangements. And Senator Eaton has pointed that out, and I've read her comments in that regard.
I have the sense that there are a lot of people who are lukewarm on this project, because they said, "The only way we're going to get any money for museums is to go along with this particular matter and get that $25 million." I don't know whether $25 million is sufficient to convert the Museum of Civilization to a museum of history. There have been comments both ways on that.
Honourable senators, I'm not leading to a conclusion on this, and I'm sorry for that, because I feel that we have not had the opportunity to properly debate and look into this matter to the extent that we can answer those questions.
The Hon. the Speaker pro tempore: Senator Day, will you accept questions? I think Senator Eaton has a question for you.
Senator Day: Certainly.
Hon. Nicole Eaton: Thank you very much for your thoughts and your intervention. You brought up Mr. Cardinal, who was the architect, and I wondered if you realized that on October 17, 2012, he was quoted as saying:
I love the fact that the museum keeps evolving and growing, and people still feel that it's a national monument that can expand and serve all of Canada.
He is complimentary of the new way of referring to the museum.
I am also wondering if you have thoughts on the definition. I was very careful to look up the definitions of "history" and "civilization," and history really is the linear story of civilizations. I'm sorry, but I don't quite understand why you and Senator Eggleton are so upset.
The Hon. the Speaker pro tempore: I will seek the authority to give Senator Day more time to give the answers. Five minutes?
Hon. Senators: Agreed.
Senator Day: I didn't look up definitions outside of the act. I did look at the act and the change of wording, and I looked at an analysis of that by others. I tried to reflect that in my comments, Senator Eaton.
I've read quite a bit about what Douglas Cardinal has had to say. I know that he is disappointed that the three different rooms in the current plan now, if we go ahead with this — the Canada room, another display room and a third one — are going to disappear into one. The third one, after having heard the questions today, is one that maybe we should think about reviving. It's the Canadian Postal Museum of postal workers and postal service in Canada. It is perhaps a little bit unfortunate that we're doing away with that museum at this time. That is one of the display areas that will disappear under this current plan.
I think maybe you're overstating the case — at least from my point of view — when you say Senator Eggleton and I are "so upset" about this. I'm concerned. I'd like to do a good job on this piece of legislation like any other, and I just feel that there are too many loose ends, too many unanswered questions for us to go ahead and vote on this bill.
Hon. Percy E. Downe: I wonder if Senator Day would take another question.
Senator Day: Certainly.
Senator Downe: I noticed the key point of your remarks was what's the rush? The House of Commons had time to study this bill. It speaks to the mandate of the Senate — sober second thought. Senator McCoy talked about the amendments we've made to bills since 2000 — 217 amendments, 203 of which were accepted by the House of Commons in the last number of years. We improve legislation. When we're forced to rush it, we don't serve Canadians well.
Senator Day, you recall the New Veterans Charter, which was decided in haste in the House of Commons. The Prime Minister, the Leader of the Opposition and the leaders of the two other parties were coming back from a ceremony in Europe and decided in the airplane that this was the best thing to do. Everybody had the best of intentions, wanting to improve benefits for veterans and their families.
The House of Commons had one minute of debate and had no committee hearings. They moved first, second and third reading and sent it to the Senate. Unfortunately in the Senate, it wasn't our finest hour. We insisted on one committee meeting, where we had a number of witnesses, and then we passed it within an hour or two.
Now we're spending years trying to clean up that mess. We have veterans on the street complaining "this was overlooked and this was done wrong" — all because the House of Commons did not do their job, which they don't do on a regular basis. We know that because of the amendments we pass. But for the Senate, in my opinion, it wasn't our finest hour.
Why are we rushing this bill? What is the problem with waiting for a longer period of time, addressing some of the concerns you raised today, hearing from more Canadians, proposing suggestions, if needed, to the House of Commons and getting it done right so all Canadians will be pleased, not only with the expenditure of funds, but with the final institution we end up with?
Senator Day: Thank you, Senator Downe, for your question. I'll answer that first with a confession.
I was in this chamber when the New Veterans Charter went through. I supported its quick passage because of the pressures that I sensed from the other chamber and because I was fairly new in this chamber at that time and didn't quite appreciate the role to the extent that I do now. That's probably why I'm speaking out on this bill as well. It is because of the experience we get from being here and having seen things, especially if you spend any time on the Finance Committee and see how many times this legislation comes back for correction because we're rushing it through in omnibus budget bills that have everything in them.
I have no idea why this bill is being rushed. I know that the department has started to move on this. I know that the six committees have been created. Even before we approve it, they're already moving on this, so they're anticipating passage. Senator Eaton would probably be in a better position to tell us about that. Have they already started committing — Mr. Cardinal has been hired. All of those things have happened even before the legislation has passed.
The Hon. the Speaker pro tempore: Are honourable senators ready for the question?
Hon. Senators: Question.
The Hon. the Speaker pro tempore: Is it your pleasure, honourable senators, to adopt the motion?
Some Hon. Senators: No.
Some Hon. Senators: Agreed.
The Hon. the Speaker pro tempore: On division?
Some Hon. Senators: On division.
(Motion agreed to and bill read third time and passed, on division.)
UNESCO Youth Forum on Social Inclusion
Hon. Joseph A. Day: Honourable senators, recently, youth from around the world converged in Paris for the eighth annual UNESCO Youth Forum on social inclusion, civic engagement, dialogue and skills development. This forum was an arena for youth to discuss their perspectives on the theme of social inclusion and the challenges that the youth of today face.
The Youth Forum is an important initiative of the United Nations Educational, Scientific and Cultural Organization, UNESCO, held prior to their general UNESCO conference. At the Youth Forum, youth can express their views and also discuss issues with ambassadors and permanent delegations to UNESCO.
Two Canadians were selected as the youth delegate and youth observer to represent Canada at the forum.
Betsy Leimbigler from Gatineau was chosen as a youth delegate, and she was also a page in the Senate chamber at one time, honourable senators. Claire Paetkau of Winnipeg was the youth observer. Their mandate was to represent the youth of Canada at the UNESCO forum and to prepare a report for the permanent delegation to UNESCO.
In their presentation for the forum, the Canadian youth representatives consulted with youth throughout Canada to better understand what our young people think about social inclusion and exclusion.
Honourable senators, it is my pleasure to share with you some of the viewpoints of those young Canadian youth consulted by the Canadian Commission for UNESCO, and they came up with concrete solutions to improving social inclusion. They focused particularly on the importance of valuing alternative forms of education, including experimental, out-of-class learning. When asked about what social inclusion meant to them, they explained the importance of promoting understanding and dialogue among different groups in society to avoid discrimination based on gender, age, sexual orientation, ethnic and linguistic background, ability and more.
Young people found that educating communities on the inclusiveness and integration of new immigrants, promoting community work in school curriculums and funding organizations that promote intercultural dialogue are all key aspects to improving social inclusion in Canada.
Another important recommendation for skills development and social inclusion is for organizations to provide young people with mentorship and internship opportunities, with particular focus on financially underprivileged youth. Young people also found it important to support organizations that promote intercultural dialogue and education between Native and non-Native groups in our northern communities in Canada.
I encourage honourable senators to listen to the voices of young people in regard to social inclusion. Each of us has a role in making Canada more socially inclusive for our Canadian youth.
Second reading of Bill S-207, An Act to amend the Conflict of Interest Act (gifts)
Bill to Amend—Second Reading—Debate Adjourned
Hon. Joseph A. Day moved second reading of Bill S-207, An Act to amend the Conflict of Interest Act (gifts).
He said: Honourable senators, there is some degree of urgency on this matter now, but you will see that it has been around for some time. It's the third time that this bill has been before this chamber, but I understand that there is a committee in the other place looking into various issues in relation to the Conflict of Interest Act. Therefore, I was hopeful that we could take a look at this proposed amendment to the Conflict of Interest Act so it will come to the attention of the committee in the other place and perhaps be included as one of their recommendations.
Honourable senators may recall that this bill deals with public office-holders and reporting public office-holders under the Conflict of Interest Act. There's a gaping hole in the legislation that we have known about since Bill C-2, which was the Federal Accountability Act of 2006. That was the very first piece of legislation by the Harper government, Bill C-2. Bill C-1 was a pro forma piece of legislation about railways, as I recall.
Bill C-2 was the accountability act, and as a result of the work done in this chamber, 160 amendments were actually passed. Those amendments were then sent back to the House of Commons where the bill originated. A discussion went on between representatives of the two chambers, and ultimately 80 of those amendments proposed by this chamber were accepted.
Unfortunately, one of the amendments that had been passed here and had been sent back to the House of Commons was not accepted as part of the negotiation. So what I have been attempting to do is to pick up on some of those amendments that we had passed earlier, which were not accepted at that particular time.
The bill deals with amendments to sections 11, 23 and 25. Section 11 of the Conflict of Interest Act is pretty straightforward in saying that public office-holders or reporting public office-holders cannot accept gifts or other advantages, and then there are certain exceptions, one of which caused us concern. It said that it's okay for a public office-holder to accept gifts, even though those gifts might reasonably be seen to have been given to achieve a result and to influence a public office-holder, except — and then the exception comes along — if it was a gift from a relative. That is fine; we understand that. The second part was " a friend." That is the concern: "friend" is not defined. We don't know who is a friend, but we do know that a public office-holder — the cabinet ministers and people who work in cabinet ministers' offices — the way the act now appears, can accept gifts from friends, even though that gift might well appear to influence the public office-holder into creating an advantage for the person who gave the gift. That's the problem in a nutshell.
The other two sections, 23 and 25, honourable senators, have the same exception from the point of view of publishing. If the gift is over $200, you have to let the Ethics Officer know about it. If it's a reporting public office-holder, then it has to be publicly declared if they receive a gift if that gift could reasonably be taken to appear to be influencing the public office-holder. So it's a gift or an advantage, but the exception is none of the rules apply if it's a gift from a relative or a friend. In a nutshell, that is what this bill is about.
Each Prime Minster since at least Prime Minister Brian Mulroney has had a code of ethics. They weren't part of legislation but were generated and required by all of the Prime Minister's team. The original code of ethics had wording that was much stronger than the particular wording that appears here.
In 2006, when Mr. Harper came in, he decided to put what previously had been a code into a statute and created what is known as the conflict of interest statute. In that statute virtually all the wording of the previous Prime Minister was adopted, except this one little change. Before that, in 2005, the wording was "a close personal friend." That was the exception. If you received a gift from a close personal friend, then the rules of disclosure didn't apply.
When that was transcribed into this particular bill that we now have, it just said "from a friend." So, it's obviously intended to be something much broader than "close personal friend."
During the hearings on this matter in 2006, we asked the two previous ethics commissioners about this, and they both said that the wording "from a friend" was undefined, leaving it up to the minister to determine what a friend is, which was a matter of some concern to them. They had suggested to go back to "close personal friend." I didn't know what the definition of a "close personal friend" was, either, so I proposed leaving out the exception entirely and then just dealing with the members. If it's a gift from a relative, we understand that.
Honourable senators, with respect to the section that was there previously, I am quite open to discussion and amendment on this, to go back to "close personal friend," if you are more comfortable with that, but it seems to me that we should define this somehow or preferably leave it out, because there are other exceptions.
The other exceptions, of course, are that it is not the kind of gift that would likely reasonably be taken to influence the recipient of the gift. Or, if it's a type of gift that is normally or customarily given — if we're on a trip to the Orient and the Japanese tend to like to give nice gifts and we give gifts back — there are exceptions for that kind of gift giving and receiving in the legislation as well.
Honourable senators, on the public disclosure aspects, I could go through the same arguments with respect to sections 23 and 26, but I think the point is made in relation to disclosures of $200 or more and in publishing those disclosures. The same exception applies there, as well. I submit to you an exception that shouldn't be there, that if it's a gift from a friend, then none of the fences that have been put up to protect the public and the public purse against activity that would not be acceptable are up if you just say, "Well, that's a gift from a friend. I stayed at Canada House with six of my friends. That was just a gift from a friend," and that's the end of it.
I submit, honourable senators, that this is an easy amendment that should have been made in 2006 and probably only didn't get made because there were others that loomed much larger that were made. If we could move this matter through, leave that exception out and get this over to the House of Commons, perhaps they could consider this along with the other changes that are being made.
I remind honourable senators that in Bill C-4, there are some other changes to the Conflict of Interest Act being introduced that we may have an opportunity to discuss in the next few days as we deal with Bill C-4.
(On motion of Senator Andreychuk, debate adjourned.)
Duke of Edinburgh's Awards 2013
Hon. Joseph A. Day: Honourable senators, I have mentioned previously in this chamber my work with the Duke of Edinburgh International Awards here in Canada, and I'm pleased to say that that work continues with this fine organization.
This past summer I was privileged to be invited to their Leadership, Experience, Adventure and Development Program, referred to as LEAD, at the LEAD event in Kenora, Ontario. The event required years of organization by the youths themselves and brought past and present award participants together for a week-long event. Participants could use this event to count towards their Gold Level Award and were also able to participate in a forum with past award winners where individuals spoke of how participating in the award affected them and their lives.
Colleagues, I must say that the testimony at this forum filled me with the conviction of what an important program this is for today's youth. This was a diverse group of over 100 individuals who truly represent the demographic makeup of our country. What struck me the most, however, was not just how different each story was but how all attributed much of their success in life to the skills they learn while participating in the award program.
The Duke of Edinburgh's Award has, for decades, inspired youth to take on the challenges that will enrich their lives. Whether or not they achieve an award, the awards program helps immensely in encouraging young Canadians to develop a well-rounded, active lifestyle.
Honourable senators, 2013 marks the fiftieth anniversary of the awards' presence here in Canada. The LEAD event in Kenora was but one event meant to mark this special year. Expedition 50 was held as well. Here the awards participants travelled to Jasper National Park in Alberta. Participants completed activities that included travelling by horseback through the Tonquin Valley, as well as hiking the Columbia Icefields and climbing Castleguard Mountain. I did not participate in any of those events, honourable senators.
To top off the award's fiftieth anniversary in Canada, the award will be holding its royal gala dinner in Toronto on November 1, this weekend. In attendance will be Prince Edward, the Earl of Wessex, and his wife Sophie, the Countess of Wessex. This promises to be a most memorable evening, with proceeds going to the awards, with special focus on how the awards can help at-risk youth in Canada.
It is tragically easy for youth to miss out on the many opportunities that are available and to spend their time before screens — be it televisions, computers or the like. Honourable senators, I encourage you to learn about this particular program in your area of Canada. They are all across Canada and there are bronze, silver and gold awards on a regular basis.
Please go out when you are invited to those functions and encourage these young people and congratulate them for their impressive achievements.
Income Tax Act - Bill to Amend—Third Reading—Motions in Amendment and Sub-amendment
On the Order:
Resuming debate on the motion of the Honourable Senator Carignan, seconded by the Honourable Senator Marshall, for the third reading of Bill C-377, An Act to amend the Income Tax Act (requirements for labour organizations);
And on the motion in amendment of the Honourable Senator Ringuette, seconded by the Honourable Senator Jaffer, that Bill C-377 be not now read a third time, but that it be amended in clause 1,
(a) on page 2, by replacing line 30 with the following:
"the period is greater than an amount that is equal to the maximum total annual monetary income that could be paid to a Deputy Minister, shown as"; and
(b) on page 3, by replacing line 13 with the following:
"ees with compensation that is greater than the maximum total annual monetary income that could be paid to a Deputy Minister and disbursements";
And on the motion in amendment of the Honourable Senator Segal, seconded by the Honourable Senator Nancy Ruth, that Bill C-377 be not now read a third time, but that it be amended in clause 1,
(a) on page 2,
(i) by replacing line 1 with the following:
"(2) Subject to subsection 149.01(6), every labour organization and every", and
(ii) by replacing line 30 with the following:
"the period is greater than $150,000, shown as";
(b) on page 3, by replacing line 13 with the following:
"ees with annual compensation of $444,661 or more and";
(c) on page 5, by replacing lines 34 to 35 with the following:
(b) a branch or local of a labour organization;
(c) a labour organization with fewer than 50,000 members;
(d) a labour trust in respect of one or more labour organizations that, in total, have fewer than 50,000 members; and
(e) a labour trust the activities and operations"; and
(d) on page 6,
(i) by replacing line 6 with the following:
"described in paragraph (6)(e)), that is limited",
(ii) by replacing line 10 with the following:
(iii) by adding after line 16 the following:
"(8) For greater certainty, nothing in this section shall be interpreted as affecting solicitor-client privilege.".
And on the subamendment of the Honourable Senator Cowan, seconded by the Honourable Senator Tardif, that the motion in amendment be amended as follows:
That Bill C-377 be not now read a third time, but that it be amended in clause 1, on page 2,
(a) by replacing line 23 with the following:
"(b) a set of the following statements for the fiscal period"; and
(b) by replacing line 36 with the following:
"that is to be paid or received, namely,".
And on the motion in amendment of the Honourable Senator Chaput, seconded by the Honourable Senator Mercer, that Bill C-377 be not now read a third time, but that it be amended in clause 1,
(a) on page 4,
(i) by replacing line 12, in the French version, with the following:
"sés relatifs aux activités de recrutement,", and
(ii) by replacing line 22, in the French version, with the following:
"liés aux activités juridiques, sauf s'ils ont trait à des"; and
(b) on page 5, by replacing line 36 with the following:
"of which are limited to the".
Hon. Joseph A. Day: Honourable senators, this matter is currently adjourned in the name of Senator Cools. I would ask that it be returned to her name following the various speakers on this matter.
Honourable senators, Bill C-377 was introduced as a private member's bill in the other place some time ago. We are now seeing it before us at third reading. We have heard many fine speeches on this proposed legislation — speeches that pointed out the inconsistencies with respect to this bill as well as possible constitutional matters or battles that may ensue.
Honourable senators, this bill is a test of our being in this chamber of sober second thought. At a time when the Canadian public is increasingly skeptical of our role and the work we do here, this bill will provide us with an opportunity to demonstrate the meaningful role that we do have to play in the parliamentary process.
I have followed the hearings in relation to this particular matter and I have seen the observations that were reported back from the committee. I put a lot of weight into the observations that came from honourable senators who had a chance to participate in the extensive hearings that took place and who reviewed all of the material before sitting down to determine what to do with this particular bill.
Honourable senators, my office has received close to 500 emails on this bill from individuals and groups raising their various concerns. I felt it incumbent upon me to put on the record my position as a result of having received those many letters and submissions.
I was holding off speaking on this legislation so that I could hear from some of the proponents of the bill, to better understand the legislation and why it is necessary. However, all I have heard and all I have read are problems with this legislation, including the observations, honourable senators. I think it worthwhile that we take a look at the observations that were attached to Bill C- 377 when it was returned to this chamber.
While the Banking Committee, ably chaired by Senator Gerstein, is reporting Bill C-377 without amendment, it wishes to observe that after three weeks of study, hearing from 44 witnesses and receiving numerous submissions from government, labour unions, academics, professional associations and others, the vast majority of testimony and submissions raised serious concerns about this legislation. Principal among those concerns was the constitutional validity of the legislation, with respect to both the division of power and the Charter. Other issues raised include the protection of personal information, the cost and need for greater transparency and the vagueness regarding whom this legislation would apply to. The committee shares these concerns. The committee did not offer any amendments because these substantial issues are best debated by the Senate as a whole.
How nice it would have been if we could have had more debate on this, honourable senators, from the potential proponents and supporters of this legislation.
When explaining the purpose of the bill, which is what we as senators do when we study bills, we go back to whatever we can find from those offering a comment as to the purpose of the bill. I went back to second reading, and Senator Eaton spoke. At her second reading speech, she explained that there is substantial benefit to unions and union membership through tax exemptions and tax deductions and that workers have a right to know how their union dues are being spent.
However, when Senator Eaton and, in the other place, Mr. Hiebert, who was the sponsor of the bill, talk about the bill, they go further and talk about public disclosure, not only disclosure just to the workers and the union about where their money is going, but public disclosure. This raises some issues, honourable senators.
The first issue is a question of the Income Tax Act. This proposed legislation is intended to flow from the Income Tax Act. Another issue is the one I just touched on, and that is the question of public disclosure. The Privacy Commissioner was before the committee and talked about the strong reservations she had regarding privacy considerations because of the public disclosure.
There is a lack of supporters who spoke on the bill. Since Senator Eaton spoke at second reading, I think we have seen overwhelming opposition both at the committee stage and at third reading in this chamber.
Given that the fundamental purpose is stated to be accountability and transparency, with which no one objects — no one here objects to those lofty terms — if we look at how the bill purports to achieve that goal, that is where a considerable amount of the opposition arises.
First, there is the vehicle of the Income Tax Act. I will share how some of the constitutional experts who appeared or provided submissions to the Banking Committee couched this idea of using the Income Tax Act to achieve a disclosure of private information, which is totally contrary to any concept we have with respect to the Income Tax Act previously.
Alain Barré from the University of Laval said:
I arrived at the conclusion that this was backdoor legislation. The legislator is attempting to use an appropriate legal structure in order to increase the chances of obtaining a favourable decision, were there to be a constitutional challenge.
Professor Ryder, another professor who appeared before the committee, said the bill is "using the Income Tax Act as a Trojan horse" in an unconstitutional attempt "to regulate union."
That is how witnesses before the Banking Committee couched this use of the Income Tax Act to achieve this legislation.
Honourable senators, labour relations were determined by the Privy Council in 1925 to primarily be a matter of provincial jurisdiction. Five provinces and several witnesses appeared or provided written comments to the committee, including Quebec, Ontario, Manitoba, Nova Scotia and la belle province du Nouveau Brunswick. All spoke against this legislation.
Minister Soucy, a Conservative minister in the New Brunswick government, stated: "... it is my strong recommendation that this Bill not proceed."
The Snider case in 1925 determined that the constitutional issue is criminal law jurisdiction or taxing legislation for the federal government and property and civil rights for the provincial government. Labour relations were determined to be primarily property and civil rights.
Let us look briefly at this bill and see if we can determine some other issues that might have arisen from various commentators as they looked at the legislation. We will get a bit of a flavour for this particular bill.
At clause 1, the Income Tax Act is amended by adding the following after section 149. The first is a definition of "labour organizations" with the word "includes," which in legal terms means there could be other things besides what is actually written here. Then it lists everything except the kitchen sink. Then the term "includes" appears further down in the same definition. "Include" is used twice in the definition.
Honourable senators, as we go on, you will find the term "including" or "includes" in five other places in this four-page piece of legislation. From a drafting point of view, it is highly undesirable to not have the definitive definition of various items.
Honourable senators, the bill then talks about labour organizations and labour trusts. They shall file information on an annual basis, and the information return referred to "shall include," which is at subsection (3), and it lists financial statements "including," and it goes on to list balance sheets, et cetera. Further down, it says "including a statement of accounts receivable." Including what else? What else is always the question.
There are 20 different headings under what should be in the financial returns. If that is not enough, at the end it indicates that such other items as may be required will be included. Everything plus everything else is to be reported.
It goes on to say that what is to be reported to the government must be put on the website so the public can see all this information.
Honourable senators, this is what you are being asked to vote on. It is so imprecise that it is almost impossible to know what we are voting on.
I would like to highlight some of the issues that have been raised in opposition by various organizations.
The Canada Revenue Agency talked about the workload and the millions and tens of millions of dollars it will cost to implement this. The Privacy Commissioner raised privacy considerations.
There are the costs not only to the Canada Revenue Agency, which will be collecting and publishing this information, but also to the unions and to the trusts. They are companies that invest money for pension plans and retirement plans. Those companies are caught up in the trust. They are not unions, as you would expect.
There is the Canadian Bar Association and solicitor-client privilege. You saw Senator Cowan's attempt to help them by proposing an amendment to protect solicitor-client privilege.
There are Charter concerns: freedom of association, freedom of expression and the right to political activity.
These issues were dealt with by witnesses and in speeches by honourable senators in this chamber. Any one of these I found compelling, and I found the speeches very helpful. Any one of the arguments, honourable senators, could form the basis for a legal challenge.
Undoubtedly, if we pass this legislation, there will be legal challenges on some or all of these grounds. Surely this is not the approach that we in the Senate wish to follow — passing overenthusiastic and overreaching legislation and just waiting for the courts to do the Senate's job.
That is not why we gave up doing other things prior to being appointed here, to come and rubber-stamp something that is going on in the other place and let the courts be the sober second thought. That is surely not what is intended, and I know that is not the reason honourable senators gave up what they were doing before.
Honourable senators, the facts are as communicated by the provincial representatives who insist this proposed federal legislation is not wanted and not necessary. Labour relations are a matter of provincial purview, and that is precisely where the Senate should be leaving the labour relations matters.
Honourable senators, I wonder if I might ask for five minutes.
The Hon. the Speaker: Agreed.
Senator Day: I want to mention a few of the 500 different entities from which my office has heard:
The International Association of Machinists and Aerospace Workers from Winnipeg, Local 1953 referred to "the Harper government's unfair and unconstitutional attack on Canadian workers." We have the International Brotherhood of Electrical Workers, Local 37, from New Brunswick; and the Canadian Auto Workers, Local 444. RCMP members have written to me, honourable senators. We have the International Association of Machinists and Aerospace Workers, Local Lodge 1975; the Canadian Union of Public Employees, from New Brunswick; the Healthcare of Ontario Pension Plan, because, as I mentioned to you, the trust is caught up in this; Nova Scotia Health Employees' Pension Plan; the Saskatchewan Healthcare Employees' Pension Plan, with 348,000 working and retired health care employees who will be impacted adversely by this legislation, from the labour trust point of view. They were also concerned about the privacy issues, and the publication of their names going out there.
We have the Canadian Medical Association. All provinces and territories are part of the Canadian Medical Association.
We have the Canadian Teachers' Federation.
The Association of Justice Counsel wrote to us; they are the federal lawyers who have an association.
Canada Revenue Agency said that it will cost them anywhere from a million to tens of millions of dollars to gear up to handle this extra work. If they have to take that from their budget, what do they have to give up in exchange?
The Parliamentary Budget Officer said that this bill is so nebulous — and that includes the stuff I talked about earlier — that the costs cannot be guessed and that the Canada Revenue Agency has seriously underestimated the cost of implementing this legislation.
The Canadian Labour Congress wrote to us, as did the Canadian Union of Public Employees.
Finally, the people at Quebec's Fonds de solidarité are not pleased either.
Honourable senators, as you can see from the comments from many different unions — and this is just a small sampling of the 500 — if we passed this legislation, we would be unbalancing a system that has worked very well in balance between management and organized labour.
To me, this is the most compelling argument. There is no need for legislation that will upset the marketplace, especially at this time of economic downturn.
There are four sets of amendments that honourable senators will be asked to consider, and I will do likewise. However, honourable senators, in the short time we have to deal with this, I am not convinced that through those four sets of amendments we can make right this legislation and put it in such a form that we would want to vote for it.
I do not believe the facts presented consider the objectives enunciated by the sponsor of this bill, or that any objections to this bill can be cured.
Hopefully, honourable senators, after you have considered the stated objective and the fact that there has been an attempt to use the Income Tax Act to deal with labour relations, it will convince you, as it has convinced me, that things are better left alone. We should vote against this legislation.
Hon. Terry M. Mercer: Will the honourable senator take a question?
Some Hon. Senators: Hear, hear.
Hon. Terry M. Mercer: Will the honourable senator take a question?
Senator Day: Yes, I would be pleased to.
Senator Mercer: It seems, honourable senators, this draconian piece of legislation has such a dramatic effect on labour relations in this country that it would be wise to call on the Department of Labour for their opinion.
Was the minister or department officials called to appear?
Senator Day: I did not attend all of the meetings. I would like to have been able to do so, but I was preoccupied with some other financial matters for the Senate.
However, I reviewed all of the evidence; I did not see that the Minister of Labour appeared. Whether he was called, I cannot say.
Second reading of Bill S-222, An Act to amend the Conflict of Interest Act (gifts)
Hon. Joseph A. Day moved second reading of Bill S-222, An Act to amend the Conflict of Interest Act (gifts).
He said: Honourable senators, first let me thank the previous speaker, Senator De Bané, for his wonderful exposé on an issue that we might not have thought of previously and that certainly leaves us with a good deal to think about it.
I am hopeful, honourable senators, that this particular bill will achieve the same result in bringing about a discussion with respect to a matter that most of us would not think existed. It is quite simple; it deals with gifts and how gifts are dealt with under the Conflict of Interest Act. In effect, there is a gaping hole in the legislation that leaves the conflict of interest legislation virtually ineffective in achieving what we believe the legislation is intended to achieve.
Honourable senators, let me provide some background so we can understand this. "Gifts" are gifts to public office-holders. Who are public office-holders? Public office-holders are ministers, ministers of state, parliamentary secretaries, members of ministers' staff, advisers to the ministers, Governor-in-Council appointees, ministerial appointees, et cetera. They are defined in the legislation.
This public office-holder conflict of interest legislation was part of Bill C-2, the government's much-heralded accountability ominous bill back in 2006. Several of us will recall that legislation that I think gave us a wonderful opportunity to show the role of the Senate at its best. The Honourable Speaker pro tempore was deeply involved in that particular matter as the sponsor of the bill in this place. He and I had some interesting discussions and many evenings trying to sort out some of the amendments.
This was one of the amendments that were proposed by the Senate at that time, honourable senators, when that bill went through this chamber, having come from the other place. When it went through this chamber, this was one of the amendments. Honourable senators will know that when there are amendments, they may be sent back, where some are accepted, some are not, and then they send it back again. We went through that process with this particular bill. Then there was a conference with representatives from each chamber to sort out which amendments should be accepted and which ones should not be accepted. Unfortunately, these amendments got lost in that process.
On three different occasions since then, we have attempted to bring in these fundamental amendments. They relate to the Conflict of Interest Act, 2006, sections 11, 23 and 25. The main section is section 11, which is the prohibition against accepting certain gifts. Sections 23 and 25 are public disclosure, or disclosure to the commissioner, of gifts over $200.
Before 2006, back to at least 1985, each prime minister has had a Conflict of Interest Code. Cabinet ministers are not elected; they are appointed. When they were appointed, they were subject to this code. It was made clear to them that they would be subject to the code.
In 2006, the current Prime Minister decided to take the code that was in existence and, with certain modifications, put that code in legislation. Where it was previously a code, it became a legislated act in 2006.
The Conflict of Interest Code contained the term "gifts from personal friends." That was in 1985. The commissioner of conflict of interest felt that gifts received from personal friends was an exception. You should not receive gifts, but you can receive gifts from personal friends. They felt that was a little too loose, so it was changed to something a little tighter: "close personal friends." That was the term in existence in 2006 at the time the new code came in.
When we look at Bill C-2, it did not use the "close personal friend" and "personal friend" exception. As an exception, it used the words "relatives or friends." That is what we are left with in this particular legislation, honourable senators.
Even in the circumstance where a gift — and this is the wording in the legislation — ". . . might reasonably be seen to have been given to influence the public office holder in the exercise of an official power, duty or function," that was okay if it was a gift from a friend.
If the friend gave you money or some other advantage, even though it could be perceived as influence, then it was okay. That is what we are left with, honourable senators. We have tried valiantly to change that particular loophole.
Howard Wilson and Bernard Shapiro were commissioners of conflict of interest for a period of time under previous prime ministers. When we studied Bill C-2, they both pointed out that the relaxation of this exception was not a good idea and that there should be some tightening up of the wording.
In the Senate, we tried to follow their suggestion, but we were not successful. We have tried on two different occasions since then.
This bill seeks to close that major loophole by removing the word "friend" from the legislation.
A purely hypothetical example can explain how this might happen. A cabinet minister meets a CEO of a major organization at a reception. The CEO wants legislation introduced that would help his organization. Over time, he offers the cabinet minister the use of his ski chalet, or he might offer him an envelope, but it does not have to be that blatant. He might offer him the ski chalet.
Whether the legislation gets passed or not does not matter, because the cabinet minister does not need to disclose this gift to the commissioner or the public, as long as he considers what he received from the CEO to be a gift from a friend.
Who defines "friend," honourable senators? The recipient defines "friend."
There is no definition of "friend" in the legislation. It does not have to be a close friend; it does not have to be a close personal friend. It just has to be a friend.
We have a system where public office-holders may be very easily influenced by individuals or groups outside of government, and with no way of knowing whether something might be happening or has happened, it makes us overseers of the government and the executive. It puts us in a very difficult position. However, our job would be a lot more reasonable if we knew that this legislation was in place and that those disclosures were taking place.
There is the prohibition section, section 11. It says you must not accept these gifts if they could reasonably be seen to have been given to influence a decision, and then they list the exceptions.
Two other sections are disclosure provisions: sections 23 and 25. Each of those sections has the same exception, which is that you do not have to disclose whether the money or advantage is coming from a friend. I say "money" because that is how "gift" is defined here — to include money or other advantage. Anything over $200, as long as it did not come from a friend, has to be disclosed. That is the situation that we have today.
Honourable senators, ". . . accepting the gift or other advantage, make a public declaration that provides sufficient detail to identify the gift or other advantage accepted, the donor and the circumstances under which it was accepted." This is the process that we have put in place to make sure that we do not have things happening that we will be sorry about in the future.
Senator Mercer: Brown envelope.
Senator Day: Regretfully, with the word "friend" in there, this public disclosure is quite ineffective. If it was from a friend, no one would ever know. Another problem, as I have indicated, is that the word "friend" is not defined.
What is the solution? The solution I have proposed is to take out the word "friend" everywhere it appears — sections 11, 23, 25. Take out that exception.
There is no limit under the current legislation as to the value of the gift. There is no upper limit on the value of the gift if it is from a friend. The act is explicit that the gift may be an amount of money even if there is no obligation to repay. That is basically a gift, an amount of money. That is under section 2.
Senator Mercer: Like $90,000?
Senator Day: Thus, the act permits a cabinet minister, among others, to accept large sums of cash, even where the circumstances are such that a reasonable person would believe that cash was given to influence the minister. There is still no requirement to disclose because of this "friend" exception.
As I have indicated, Howard Wilson and his colleague Bernard Shapiro both indicated that we should be taking steps to improve that area.
The Liberal members of the Standing Senate Committee on Legal and Constitutional Affairs put forward two amendments, as I have indicated. The government felt that this, perhaps with the other 150 amendments, did not loom as large, I suspect mainly because no one focused on it.
Honourable senators, the bill proposes that these amendments be made. We have it in the code of ethics that applies to us as senators: If it is a gift of over $500, we are required to declare it. Under the Canada Elections Act, if it is a gift over $500, there is a requirement to declare that. However, there is no requirement as long as the word "friend" remains in there. It is an exception. You cannot do it; however, from a friend, you can do it. You do not need to declare it.
Honourable senators, I believe Canadians have a right to know who is giving expensive gifts to high-ranking members of the Government of Canada. Surely an act purporting to provide transparency and accountability should provide nothing less.
The Hon. the Speaker pro tempore: Honourable Senator Day, will you accept a question?
Senator Day: Yes.
Hon. Roméo Antonius Dallaire: Honourable senators, this is a little tangential to what Senator Day was speaking of. As we have the financial administration directives, the legal branch and the ethics officer, is it possible that one could have something that is ethical but not legal?
Senator Day: This is a bit of an esoteric question. I cannot give honourable senators an example, and I thank Senator Dallaire for the question.
I believe that, yes, one could. They are two different legally based terms, and we could have one and it might be quite an unethical thing that one sees happening. In ethics, it tends to be more of a subjective thing, whereas legal is more black and white. Yes, we could have one without the other.
Hon. Wilfred P. Moore: I want to thank Senator Day for bringing this amendment forward; it is most timely. I would like to take the adjournment for the balance of my time.
(On motion of Senator Moore, debate adjourned.)
Economic Action Plan 2013 Bill, No. 1—Second Reading
Hon. Joseph A. Day: Honourable senators, I do not have a question for Senator Buth, but I will make a few remarks at this time.
I would first like to congratulate Senator Buth for rapidly becoming the expert on omnibus bills here in the chamber, having sponsored last year's as well as this year's. The fact that this year's omnibus bill is about half the size of last year's is an indication that something she is doing is working, but we have to keep working to bring this down even further.
My honourable colleague read out the title to honourable senators, and I will read it again because I think it is important to be reminded of it: "An Act to implement certain provisions of the budget tabled in Parliament on March 21, 2013 and other measures."
It is always the "other measures" that make this an omnibus bill and tie it into a finance bill. Why do they tie it into a finance bill? So they can get those other measures passed quickly without proper scrutiny. That is the problem. It is not necessary.
There is nothing wrong with an omnibus bill picking up little bits of things that have to be changed in various departments that would not warrant a full bill each by itself. There is nothing wrong with that. There should be an annual omnibus bill to pick up the housecleaning. However, tying it in with a money bill and then saying that it is a matter of confidence, that it has to be done immediately without proper scrutiny, is where we disagree on the approach that is being taken.
Honourable senators, I hope we will see a continuation in the reduction in the number of "other measures." I would love to see that terminology in budget implementation bills removed, the "other measures," and just deal with matters from the budget.
This bill is 116 pages long and has 233 clauses, and your Finance Committee reviewed each one of those clauses. We do not want to have happen what has happened in the past, where certain clauses might have gotten overlooked because they were very small, looked innocuous and looked like they would not cause any problems but turned out to be very serious: the removal of parliamentary scrutiny, for example, of borrowing. One tiny little clause did that, and it was found by this chamber and by the Finance Committee, but very late in the process. It had already passed through the House of Commons.
Honourable senators, this is second reading of this bill. We did a pre-study of the matter because we wanted to be ready. We knew it would be coming at the end, that it would be tied to finance and that the government would have to have it. We have seen it all before by more than one government, and I admit to that. I was not happy then either, and I stood up when I was over on the government side and said the same thing then, that I hoped that this would change. The only way it will change is for all of us to say that.
However, we did a pre-study, which is not something that normally happens, but it often happens with respect to these omnibus finance bills because we get them late and we know that the government will need them.
The pre-study, honourable senators, had a report, which we finished last week, after two or three weeks of five meetings per week. I want to thank all honourable senators who served on the Finance Committee to help move this along and do the job that is expected of us. I am looking at many honourable senators opposite who served on the committee to help us do that job.
We have a report, honourable senators, and that report is one of the next items that we will be dealing with, and that outlines the steps that we have taken. It does not provide an analysis of what we have heard, and I would recommend that if honourable senators would like to review the many witnesses we heard from, it is all online. Honourable senators have the opportunity to look at that.
I will not, at this stage, talk about the report. In fact, I will not get into detail on many of the matters that appear in this bill, because we are at second reading and we are just looking at principal issues at this stage. We will get into the detail in third reading, and the matter will be referred. Unlike the supply bills that we have had in the last two days, this bill will be referred, I expect, to the Finance Committee. We have knowledge of the clauses, we know what is in there and we are in a position to do clause by clause, dealing with the bill once it is referred to our committee. It will then be referred back here for third reading next week, I anticipate.
Sometimes, when one hears honourable senators speaking on this, one will think we are voting on the budget. We are not voting on the budget. This chamber has a history of not voting on the budget. We do not accept the budget, and it is not because we do not vote on it. It is not deemed to be accepted by us, the same way that there is a lot of deeming that goes on in the process and procedures in the other place. We vote on budget implementation bills, and there will be two of them — I expect another one in the fall — and we will vote on those and deal with them just like other bills that come here, other than what I have just explained about a pre-study sometimes in order to get on with some of the issues. We would never be ready to deal with this otherwise. It took us three weeks to be ready, and we would never be ready to deal with this at second reading now if we had not done the pre-study.
We have heard from the Honourable Senator Buth about some of the issues that are in the budget, so let me just mention a couple that honourable senators should be aware of, and these are with respect to tax increases.
This initiative of Budget 2013, if we take everything together and net out the decreases that we have heard about — and it is always nice to hear about some of the decreases for sports equipment and some children's clothing, but there is preferential treatment for certain nations in relation to tariffs. The status of "preferred nation" is being removed for many nations. This is all happening at the same time. The net effect is that what we talked about in the report that we prepared showing discrepancies between Canada and the United States will be compounded by the action of the government here. It will not be introduced for a couple of years, but the effect with the General Preferential Tariff is tariff increases next year of $83 million, and for each year thereafter $333 million more in tariffs for goods that are coming in here. These are goods that we might do some value-added to, goods that our industries may want, and final consumer goods, so the cost could be even more than that sometimes.
The gap that we talked about between U.S. and Canadian prices will increase, regretfully. We asked the minister about it, when he was in. He said he will do a study on the few that he has reduced. We want to play a crucial role in relation to the study that will be going on because I think it is critical that we bring down tariffs. If we need taxes to pay for government operations, they should be upfront taxes and not something hidden away as a tariff that becomes an increase and a multiplier. That is why we had the Goods and Services Tax, which was a good move because it took away manufacturers' taxes. It was a consumption tax. Now we are increasing the tariffs. That, honourable senators, is unfortunate. If we look at all the budget items, it looks from the calculation like $3.3 billion more in taxes over the next five years is provided. I repeat: $3.3 billion more in taxes as a result of all of the initiatives that appear in this budget.
Honourable senators, that is what we are dealing with here and that is what we have discovered from doing our study of this bill. Of course, the spin is always a positive one, but there are some negatives — quite a few of them — when one looks at it.
I want to refer to one area today, and that is Part 3, Division 9. I will not go to the changes that appear there. If you want to look at Part 3, Division 9 of the bill that you have before you, you will see that it relates to immigration and citizenship. Now, honourable senators, we had before us representatives of the government from Citizen and Immigration Canada, and a number of issues came out of their testimony that I think are important for me to share with you because they highlight some issues that we have seen before.
The chair was asking Ms. Paré certain questions, and she said, "We are seeking an exemption" of a particular act, and we were asking why they were seeking an exemption to that act. The act relates to fees that are added to a product to cover the government's cost. We were asking her why they were seeking an exemption. She said:
We are seeking an exemption because we want more flexibility and want to be able to shift the burden of the costs from the taxpayers to the users of the services.
Fine. She continued:
As previously mentioned by my colleague, we are already following a legislative framework that is set under the Financial Administration Act. The government is not allowed to charge more than the cost of processing.
The chair continued:
Was the procedure for increasing or decreasing user fees in the Financial Administration Act in place when Parliament saw fit to pass the User Fees Act?
She is complaining they want an exemption of the User Fees Act because they can go back to the Financial Administration Act. The question was whether the Financial Administration Act and these procedures were in place when Parliament saw fit to add this new piece of legislation called User Fees Act.
This was a question. She said yes, the act was in place, and then the question was:
The Chair: Yet, you are saying that although Parliament passed the User Fees Act, you are finding it a little inconvenient and would like to stay with what was in existence before. . . .
The only thing you can tell us is that you are following what was already in existence under the Financial Administration Act and you are finding it a little inconvenient to deal with this new legislation. Is that what you are telling us?
Then we go on with further discussion by Ms. Paré on that matter:
The Chair: I am wondering about this answer. I have expressed a concern about seeing all these exemptions in here.
They are asking for exemption in this legislation, in Bill C-60, saying the User Fees Act will not apply to all of the activities of the Immigration and Refugee Protection Act.
There is also a request for user fee exemption under the Citizenship Act. If you do a search, you will find a number of other exemptions. It is starting to sound like what we have seen before with exemptions in relation to statutory instruments. Honourable senators will recall I pointed that out on a number of occasions. When you exempt it from saying it is not a statutory instrument, it means that it is not reviewable by the Standing Joint Committee for the Scrutiny of Regulations between the house and here because it does not fit within the definition of regulation.
Now they are saying, well, we were happy with the law before Parliament passed the User Fees Act and now we would like just to be exempt from the procedures that are in there. The User Fees Act was passed by Parliament in 2004, and they are asking that it not apply.
Honourable senators, I wanted to bring that to your attention because it highlights an underlying approach. This may not be the government; this may just be people in the departments that are asking for all this. I would guess that 90 per cent of those in government who agree to put this legislation forward have only half an idea of what is in here to start with. We know that the House of Commons does not know what is in there. We have seen that in the past, and we know that is the case here. It is important for us to do our job, to know what is here and to highlight these issues, and that is what we are trying to do.
Honourable senators, I read to you from the witness for Citizenship and Immigration Canada, and I would like you to hear from one of our other witnesses, a Mr. Martin Lavoie, who was also before us. Mr. Martin Lavoie said:
While we are working with the government to make appropriate improvements to the program, we are concerned about the manner in which user fees will be managed for labour market opinions under Bill C-60.
He is talking about the labour market and bringing in foreign workers, under Bill C-60.
Division 9 of Part 3 of the bill states that the fees to be charged for LMOs will be exempt from the User Fees Act.
This is Mr. Lavoie, Director of Policy, Manufacturing Competitiveness and Innovation, Canadian Manufacturers & Exporters, an extremely important group of independent business people within the area.
While I have not received confirmation from officials, I presume that this means the government will not consult stakeholders on the level of the fees . . .
It will not be the way it was in the past because they want to be exempt. They did that consultation in the past because they were required to do it under a law that we passed. Now, they are asking us to exempt them from that.
There will be no impact assessment, no tabling or publication of proposed new fee structures, et cetera. CME and industry as a whole has generally agreed that it is reasonable to pay user fees, but not under these conditions.
The User Fees Act was established specifically because of the abuse of user fees by government departments and agencies as a way to increase revenues to cover costs rather than finding more efficient ways to deliver services or working with industry to establish effective user fees.
This clause sets a bad precedent, in our view, and we strongly recommend that the fees charged for labour market opinions not be exempt from the User Fees Act.
They are asking for exemptions. One independent witness came and said that it is wrong to do this, that it should not be done and that everything was working fine the way it was. He also highlighted the reason why the User Fees Act was in fact passed, because there were abuses of this indirect tax called user fees. There was abuse of that in the past.
I would like to read from a transcript of Dr. Lori Turnbull, Assistant Professor, Dalhousie University, who appeared before us on another bill. She said:
The justification for bypassing parliamentary approval and parliamentary scrutiny of raising and spending of money is often efficiency. It will be quicker. It makes more sense to do it this way. If we do not have to go through the extra step, it means that the government can be more responsive and efficient. It can handle things better and respond to crises better.
That was her comment and the argument that the government makes for doing away with the checks that we have put on various processes.
That is what Mr. Martin Lavoie said. That is the argument that is being made by the government in this particular instance. In fact, that is what the government representative said; it is just inconvenient for us.
I think that Dr. Turnbull is absolutely right, and she objects to this. She talked about the balance between having the scrutiny that comes with democracy and efficiency, and not wanting to be bothered with all this nonsense of democracy and checks and balances. I would recommend it highly to honourable senators as an excellent exposé of what is happening. She spent quite a bit of time on that particular matter.
Honourable senators, I will conclude with two articles that appeared in the paper recently that I think would be of interest to you. They relate to Bill C-60.
The first one was in The Globe and Mail on Wednesday, June 12, and is entitled "Warrantless Workplace Searches Raise Concerns from Businesses." Warrantless search and seizure is coming through Bill C-60.
We have seen this in the past, honourable senators. What happens is that we pass something saying that, instead of putting the rules in the legislation, we will put it into something else. Then, you do not find out what the intended use is for this.
The new rules bring businesses relying on temporary foreign workers, which is what is in Bill C-60, under similar inspection regimes to ones used or required under other legislation that we have seen in the past. In particular, honourable senators will recall product safety. For product safety, we fought hard at that the time, saying, "That is not needed." The article states:
The Charter of Rights and Freedoms protects people and businesses from unreasonable search and seizure. . . . But courts often allow warrantless inspections of regulated businesses, lawyers say.
In talking about passing these new regulations that allow for warrantless search and seizure, the article refers to the President of Canadian Manufacturers & Exporters and states:
He said he hopes this doesn't represent an effort by Ottawa to further discourage use of the temporary foreign worker program.
The article concludes by asking how many people will get involved in bringing in foreign workers when they expose themselves to this type of warrantless search and seizure at any time from now until six years hence. Over the next six years, because of these rules that are being generated — and they have been published now — this warrantless search and seizure will be available. How did they come about? How did some of these other regulations come about? They come about because we think they are regulations, but they are not. These are "directives" of the minister. It is a new term that they are using. Then they say that it is not a scrutiny of regulation. It is not subject to that because it is a directive of the minister.
These are the games that are going on that exclude the role of Parliament to do what we are supposed to be doing. We are seeing it again in this particular bill, Bill C-60, under immigration and the people whom we bring in as temporary workers.
There was another article in The Globe and Mail yesterday on this. The public is starting to see what is going on, and it is our role to help them understand the process. The headline here is: "The State Intrudes on the Workplace." There is another example, honourable senators, of the same issue that I am trying —
Senator Mitchell: Was that in the National Post?
Senator Day: No, it was in The Globe and Mail.
Honourable senators, I am trying to bring to your attention that there are a lot of hidden dangers and unintended consequences in the 233 clauses that appear in this bill and that we have to try to be aware of and try to predict. It will be so much easier if we could just have an act.
For example, in this legislation, there is a separate act with respect to Foreign Affairs and dealing with bringing in the Canadian International Development Agency, the structure and the three ministers and how that is all going to be done. Admittedly, it is mentioned in the budget, but it did not have to be part of this bill. We did not have to have an act within an act. We could have had an act that stood alone, just reflecting and enabling what had taken place, just the government policy. Instead, it gets all pushed in here and we just do not have time to do a proper analysis of all of these items that come up.
Still, I want to thank the honourable senators who served on the committee for the work that we did do. It was better than the work that might otherwise have been done because we did the pre-study. In that regard, I will look forward to the bill being referred to committee, and then I will look forward to engaging honourable senators further on some other issues at third reading.
The Late Neil Reynolds and The Late Peter Worthington
Hon. Joseph A. Day: Honourable senators, in the past fortnight Canada has lost two of its greatest print media pioneers: Neil Reynolds and Peter Worthington.
Born in Kingston in 1940, Neil Reynolds began his career in media at a young age as a newspaper delivery boy, delivering theKingston Whig-Standard to people in the Kingston area. This path would see him become editor-in-chief of that very newspaper, along with several other major Canadian newspapers.
As a resident of Saint John, New Brunswick, I particularly remember his stint as editor, and later as editor/publisher of theTelegraph-Journal and the Brunswick News in the late 20th century. Here he turned that publication on its head and can be credited with helping it become the highly respected publication it is today.
Neil Reynolds was a true gentleman. He did not shy away from stirring the pot in his writings. He was a fierce libertarian and had a strong belief in personal freedoms, including freedom of speech and, by extension, freedom of the press. For a brief time in the 1980s, he stepped away from reporting in journalism to become the first full-time national leader of the Libertarian Party. He was unsuccessful, thank goodness, and returned to journalism.
Neil died Sunday, May 19, at his Ottawa home after a battle with cancer. He was 72 years old.
Peter Worthington was cut from a similar cloth. The son of an army general, born in an army camp in Winnipeg's Fort Osborne Barracks in 1927, his toughness and hard-headedness were almost preordained.
Fearless by nature, he would escape his adolescence by running away and attempting to join the Merchant Navy at the age of 15, but was quickly turned away due to his age. By 17 years of age, his mother was prepared to sign the consent forms to allow him to join the Navy in 1944. By 18 he would become the youngest and, in his own words, the least competent sub-lieutenant in the Royal Canadian Naval Volunteer Reserve. A few years later he served in the Korean War.
Mr. Worthington would go on to become a respected and tenacious journalist and help create the Sun Media chain from scratch.
Peter Worthington, too, had a brief political career running as an independent in the Toronto riding of Broadview-Greenwood in 1982. He, as well, was unsuccessful in that campaign and returned to journalism.
It was as a result of his involvement in the Korean War through which I had the honour of meeting Mr. Worthington during a pilgrimage to Korea in 2003 in recognition of the Korean War's fiftieth anniversary.
I had the honour of attending Mr. Worthington's funeral with hundreds of his acquaintances, friends and families. He passed away on May 12 at the age of 86.
To the families of Peter Worthington and Neil Reynolds, we offer our sincere condolences and our thanks for sharing with us two such capable men of independent spirit. Both of these men were talented, skilled journalists who were not afraid to try different things. They brought a dignity to the newspaper business that is hard to match, and those pursuing a career in journalism would be smart to do the best they can to emulate those fine gentlemen.