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Debates of the Senate (Hansard)
1st Session, 36th Parliament,
Volume 137, Issue 28
Tuesday, December 9, 1997
The Honourable Gildas L. Molgat, Speaker
Table of Contents
Pages Exchange Program with House of Commons
SENATORS' STATEMENTS
The Senate
Response to Newspaper Article on Senator's Residency Qualifications
History of the Vote in Canada
Book Launched by Governor General
ROUTINE PROCEEDINGS
Report of Committee
Income Tax Conventions Implementation Act, 1997
Report of Committee
Present State and Future of Agriculture
Report of Agriculture and Forestry Committee Tabled
Present State and Future of Forestry
Report of Agriculture and Forestry Committee Tabled
Internal Economy, Budgets and Administration
Seventh Report of Committee Presented
ADJOURNMENT
International Assembly of French-Speaking Parliamentarians
Meeting held in Luxembourg-Report of Canadian Section Tabled
Foreign Affairs
Committee Authorized to Meet During Sitting of the Senate
The Senate
Conduct of Business-Notice of Inquiry
QUESTION PERIOD
Federal-Provincial Relations
Reduction in Transfer Payments to Province of Quebec-Request for Particulars
Reduction in Transfer Payments to Provinces-Effect on Atlantic Provinces
Environment
Reduction in Greenhouse Gas Emissions-Support by Provinces of Government Position taken at Kyoto-Request for Particulars
Reduction in Greenhouse Gas Emissions-Target Year for Implementation of Government Position taken at Kyoto-Government Position
Reduction in Greenhouse Gas Emissions-Informetrica Study on Meeting Targets-Government Position
Reduction in Greenhouse Gas Emissions-Concept of Differing Targets-Government Position
National Unity
Recent Remarks of Prime Minister-Possible Conditions of Secession of Quebec-Government Position
Immigration
Tracking and Detention of Unsuccessful Refugee Claimants-Government Position
Detention Facilities for Refugee Claimants-Request for Particulars
Fisheries and Oceans
Negotiations on Multilateral Agreement on Investment-Continuation of Limit on Foreign Ownership of Commercial Licences-Government Position
National Defence
Search and Rescue Helicopter Replacement Program-Possible Cabinet Discussion on Awarding Contract for Helicopter Purchase-Government Position
Search and Rescue Helicopter Replacement Program-State of Sea King Helicopter Fleet-Government Position
Federal-Provincial Relations
Reduction in Transfer Payments to Atlantic Provinces Equal to Increase in Social Transfers-Government Position
Delayed Answers to Oral Questions
Human Resources Development
Changes to Canada Pension Plan-Accountability and Transparency of Investment Board-Undertaking to Publish Quarterly Financial Statements-Government Position
Changes to Canada Pension Plan-Investment Board Not Subject to Access to Information Act-Government Position
Universal Declaration of Human Rights
Commemoration of Fiftieth Anniversary-Plans of Government
Activities planned around December 10, 1997 for the launch of the 50th Anniversary commemorative year of the Universal Declaration of Human Rights (UDHR)
National Defence
Lack of Helicopter for Number of Navy Frigates-Government Position
Forestry
Demolition of Government Laboratories-Possibility of Restoration of Funding-Government Position
Answers to Order Paper Questions Tabled
Energy-Department of the Environment-Conformity with Alternative Fuels Act
Energy-Department of Justice-Conformity with Alternative Fuels Act
Energy-Department of Multiculturalism-Conformity with Alternative Fuels Act
Energy-Department of Natural Resources-Conformity with Alternative Fuels Act
Defence-Status of Clothe the Soldier Project
Defence-Status of the Armoured Personnel Carrier Replacement Program
Business of the Senate
ORDERS OF THE DAY
Second Reading-Debate Continued
Canada Cooperatives Bill
First Reading
Criminal Code
Interpretation Act
Bill to Amend-Second Reading-Motions in Amendment-Debate Adjourned to Await Ruling of Speaker
Motion in Sub-Amendment
Quebec
Linguistic School Boards-Amendment to Section 93 of Constitution-Report of Special Joint Committee Adopted
Quebec
Linguistic School Boards-Motion to Amend Section 93 of Constitution-Debate Adjourned
Internal Economy, Budgets and Administration
Sixth Report of Committee Adopted
Bill to Amend-First Reading
Canada Marine Bill
First Reading
Aboriginal Peoples
Royal Commission on Aboriginal Peoples-Committee Authorized to Study Recommendations
THE SENATE
Tuesday, December 9, 1997
The Senate met at 2:00 p.m., the Speaker in the Chair.
Prayers.
Pages Exchange Program with House of Commons
The Hon. the Speaker :
Honourable senators, before I call for Senators' Statements, I should like to introduce the two pages who are with us this week through the exchange program with the House of Commons.
They are Anne McCulluch of Calgary, Alberta, who is pursuing studies in journalism at Carleton University.
Kirk Nangreaves of Saint-Hubert, Quebec, is studying at the University of Ottawa Arts Faculty.
He is majoring in psychology.
On behalf of all senators and the Senate, I bid you welcome.
SENATORS' STATEMENTS
The Senate
Response to Newspaper Article on Senator's Residency Qualifications
Hon. Colin Kenny :
Honourable senators, I rise today on behalf of a colleague who cannot be present, Senator Paul Lucier.
Senator Lucier has sent me a fax which he has asked me to communicate to the chamber.
For your benefit, he wants me to reply to the comments made about him in the media recently.
He writes:
I would like to make some points with respect to this matter:
The Citizen said: "Paul Lucier said the Senate's legal staff approved his change in residency five years ago when he moved to Vancouver."
Senator Lucier says:
This is not true.
I never spoke with legal staff five years ago about this.
I never had any problem about residency.
2. The Citizen said: "He said Senate staff told him he could keep his seat as long as he continues to own property in the Yukon."
Senator Lucier replies:
Again, I never spoke to the staff and was therefore never told any such comment.
On my attendance, 21 % (19 out of 87 sittings), and on the statement: "He says -
Senator Lucier has underlined the word "says."
- he has bone cancer and must live in the British Columbia city for treatments".
Senator Lucier replies:
I wonder if Jack Aubry is questioning the fact that I have cancer.
I would gladly give him permission to question my doctor as to whether I have had cancer for 10 years.
4. I would like to have these points clarified but not in the media.
I truly appreciate all the support I have received from my colleagues regarding this subject.
Thanks to all of you.
History of the Vote in Canada
Book Launched by Governor General
Hon. Mabel M. DeWare :
Honourable senators, yesterday, the Right Honourable Romeo LeBlanc, Governor General of Canada, launched an important new book, A History of the Vote in Canada , which recounts how the right to vote has evolved over the past 250 years.
The book starts at the time of the first elected legislatures in what is now Canada and ends with the most recent federal election.
It traces changes in voting eligibility, electioneering and voting practices, as well as voter turnout since Confederation.
Extension of the vote to those who were excluded legally from the franchise, such as women, aboriginal people, religious and racial minorities, is examined in the social context of the period.
Even though most Canadian adults were eligible to vote by 1920, there is a final chapter that looks at ways to make voting accessible to everyone, including people in all geographic locations and people with physical disabilities.
A History of the Vote in Canada is meant to be an educational resource and a reminder to Canadians of the significance of the right to vote.
This is in keeping with Elections Canada's 1993 mandate to educate voters about the democratic right to vote.
While this book will appeal to historians, political scientists, university and high school teachers and students, it is hoped that it will also reach those who may have difficulty exercising their right to vote.
As parliamentarians, honourable senators, it is our role to help promote this book and educate our fellow citizens on their rights as voters.
ROUTINE PROCEEDINGS
Report of Committee
Hon. Ron Ghitter , Chair of the Standing Senate Committee on Energy, the Environment and Natural Resources, presented the following report:
Tuesday, December 9, 1997
The Standing Senate Committee on Energy, the Environment and Natural Resources has the honour to present its
SECOND REPORT
Respectfully submitted,
The Hon. the Speaker :
Honourable senators, when shall this bill be read the third time?
On motion of Senator Butts, bill placed on the Orders of the Day for third reading at the next sitting of the Senate.
Income Tax Conventions Implementation Act, 1997
Report of Committee
Hon. Michael Kirby , Chairman of the Standing Senate Committee on Banking, Trade and Commerce, presented the following report:
Tuesday, December 9, 1997
The Standing Senate Committee on Banking, Trade and Commerce has the honour to present its
SIXTH REPORT
Your Committee, to which was referred the Bill C-10, Act to implement a convention between Canada and Sweden, a convention between Canada and the Republic of Kazakhstan, a convention between Canada and the Republic of Iceland and a convention between Canada and the Kingdom of Denmark for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and to amend the Canada-Netherlands Income Tax Convention Act, 1986 and the Canada-United States Tax Convention Act, 1984, has examined the said Bill in obedience to its Order of Reference dated December 8, 1997, and now reports the same without amendment.
Respectfully submitted,
The Hon. the Speaker :
Honourable senators, when shall this bill be read the third time?
On motion of Senator Kirby, bill placed on the Orders of the Day for third reading at the next sitting of the Senate.
Present State and Future of Agriculture
Report of Agriculture and Forestry Committee Tabled
Hon. Leonard J. Gustafson :
Honourable senators, I have the honour to table the second report of the Standing Senate Committee on Agriculture and Forestry, which requests that the committee be empowered to incur special expenses pursuant to the Procedural Guidelines for the Financial Operation of Senate Committees .
I ask that this report be printed as an appendix to the Journals of the Senate of this day.
The Hon. the Speaker :
Is it agreed, honourable senators?
Hon. Senators :
Agreed.
The Hon. the Speaker :
Honourable senators, when shall this report be taken into consideration?
On motion of Senator Gustafson, report placed on the Orders the Day for consideration at the next sitting of the Senate.
Present State and Future of Forestry
Report of Agriculture and Forestry Committee Tabled
Hon. Leonard J. Gustafson :
Honourable senators, I have the honour to table the third report of the Standing Senate Committee on Agriculture and Forestry, with a request that the committee be empowered to incur special expenses pursuant to the Procedural Guidelines for the Financial Operation of Senate Committees .
I ask that the report be printed as an appendix to the Journals of the Senate of this day.
( For text of report, see today's Journals of the Senate, Appendix "B", p. 321.
The Hon. the Speaker :
Honourable senators, when shall this report be taken into consideration?
On motion of Senator Gustafson, report placed on the Orders the Day for consideration at the next sitting of the Senate.
Internal Economy, Budgets and Administration
Seventh Report of Committee Presented
Hon. Bill Rompkey , Chair of the Standing Committee on Internal Economy, Budgets and Administration, presented the following report:
Tuesday, December 9, 1997
The Standing Committee on Internal Economy, Budgets and Administration has the honour to present its
SEVENTH REPORT
Your Committee notes the attendance record of Senator Thompson and recommends that, effective immediately:
Senator Thompson's use of the Senate resources ordinarily made available to him for the carrying out of his parliamentary functions, including funds, goods, services and premises, be suspended;
2. Senator Thompson's allowances for travel and telecommunications expenses be suspended, with the exception of his expenses for travel between his place of residence in Ontario and the Senate in Ottawa; and
3. Senator Thompson may apply in person to have this decision varied to the Standing Committee on Internal Economy, Budgets and Administration, which the Committee has the authority to do.
Your Committee, in conjunction with the Standing Committee on Privileges, Standing Rules and Orders, is continuing to study this issue.
Respectfully submitted,
The Hon. the Speaker :
Honourable senators, when shall this report be taken into consideration?
On motion of Senator Rompkey, report placed on the Orders of the Day for consideration at the next sitting of the Senate.
ADJOURNMENT
Hon. Sharon Carstairs (Deputy Leader of the Government) :
Honourable senators, with leave of the Senate and notwithstanding rule 58(1) h ), I move, seconded by the Honourable Senator De Bané:
That when the Senate adjourns today, it do stand adjourned until tomorrow, Wednesday, December 10, 1997, at 1:30 p.m.
The Hon. the Speaker :
Is leave granted, honourable senators?
Hon. Senators :
Agreed.
Motion agreed to.
International Assembly of French-Speaking Parliamentarians
Meeting held in Luxembourg-Report of Canadian Section Tabled
Hon. Pierre De Bané :
Honourable senators, pursuant to rule 23(6) of the Senate, I have the honour to present, in both official languages, the reports of the Canadian section of the International Assembly of French-Speaking Parliamentarians as well as the financial report of the 23rd regular session of the IAFSP and its executive committee, held in Luxembourg from July 7 to July 10, 1997.
Foreign Affairs
Committee Authorized to Meet During Sitting of the Senate
Hon. John B. Stewart :
Honourable senators, with leave of the Senate and notwithstanding rule 58(1)( a ), I move:
That the Standing Senate Committee on Foreign Affairs have power to sit at 3:15 p.m. tomorrow, Wednesday, December 10, even though the Senate may then be sitting, and that rule 95(4) be suspended in relation thereto.
The Hon. the Speaker :
Is leave granted, honourable senators?
Hon. Noël A. Kinsella (Acting Deputy Leader of the Opposition) :
Honourable senators, in the past two years or so, there has been a common understanding in this chamber that Wednesdays would constitute a short day.
This is why we have been meeting at 1:30 p.m. The general understanding is that we try to finish our business in the chamber by about 3:30 p.m.
In the past few weeks, we have heard requests like the one raised by the Honourable Senator Stewart.
If the request speaks to a Tuesday or a Thursday, when we normally meet at 2 p.m. and sit a little longer, there would be no difficulty, all things being equal, in granting leave.
However, I am having some difficulty in granting leave for a day when we are supposed to be having a short day in any event.
I would ask the honourable Chairman of the Foreign Affairs Committee if he would explain his motion in light of the fact that Wednesday is a short day.
Senator Stewart :
Honourable senators, there are two points:
First, we are hoping tomorrow to have a timely assessment of the achievements of the APEC meetings.
Senator Lynch-Staunton :
Watch out for the pepper spray!
Senator Stewart :
The second point relates to the request for permission to meet tomorrow at 3:15 p.m. although the Senate may be then sitting.
If I felt secure in the prognosis that the Senate would rise at three o'clock - which is the assumption on which we base our start time of 1:30 p.m. - I certainly would not undertake to put forward this motion.
However, past experience suggests that, notwithstanding the fact that we do meet on Wednesdays at 1:30 p.m., we often sit well beyond three o'clock.
On one occasion we had witnesses waiting for upwards of an hour.
Senator Kinsella :
Thank you, Senator Stewart.
Perhaps I might address the Deputy Leader of the Government, then.
By way of recapitulation, this issue is important for all honourable senators.
A request for leave has been made by the Chairman of the Foreign Affairs Committee to allow that committee to sit tomorrow, Wednesday, even though the Senate may then be sitting.
The issue is that Wednesday, in our common understanding, was to be a short day to allow committees to sit on Wednesday afternoons.
Not just today but at other times, Senator Stewart has brought to our attention the fact that committees operate on that assumption and arrange their business plans, only to be frustrated in executing their business plan by the Senate going way beyond 3:00 or 3:30 p.m. on Wednesday afternoons.
Senator Stewart has explained to us that that is the main concern.
He would like some assurance from the leadership on both sides that, on Wednesdays, we would try harder to respect that tradition.
We on this side agree to make every effort to complete our work on Wednesday afternoons at around 3:00 or 3:15 p.m. If you can also agree, perhaps we do not need to have this motion.
The Hon. the Speaker :
Honourable senators, is leave granted?
Senator Kinsella :
It depends upon the answer.
Hon. Sharon Carstairs (Deputy Leader of the Government) :
Honourable senators, we must make an effort to allow committees to sit.
They do invite witnesses, many of whom come from out of town.
We inconvenience them if we are not able to hear from them.
I must congratulate senators on this side who have refrained, for the most part, from making Senators' Statements on Wednesdays, unless it was something quite urgent, as was Senator Kenny's statement today.
They have tried to make their speeches on either Tuesdays or Thursdays.
Senators on the other side have attempted to do the same thing.
With that level of cooperation, perhaps at some time in the future we can invoke a more formal process whereby there will be some guarantee to committee chairs.
Barring that formal process, Senator Stewart has witnesses to hear from tomorrow, and I should like him to have permission to hear those witnesses tomorrow.
Hon. John Lynch-Staunton (Leader of the Opposition) :
That worked for a while.
Now we have forgotten Mondays, but we have continued on with the practice of having early sittings on Wednesdays.
As a result, Wednesday has become a normal working session, going on until five or six o'clock.
The whole purpose of starting the session at 1:30 p.m. has been defeated.
I do not think it is correct, unless there is an urgency, for committees to sit at the same time as the chamber.
This is not for appearances' sake, but because the work done here can often be as important in the debates as what goes on in committees.
At various stages of our work - the introduction of bills, second reading, committee referral, then third reading - we are often doing several at the same time.
Sometimes even two, three or four committees are sitting when we are sitting.
That is an improper practice.
If the deputy leader could guarantee to us that, on Wednesdays from now on - and we will strive to be cooperative - we will sit no later than 3:30 p.m., unless there is a proven urgency, then I think Senator Stewart's motion is in order.
However, we need that assurance first.
Senator Carstairs :
Let me assure the Leader and Deputy Leader of the Opposition that we will do everything on our part to ensure that sessions end on time.
We did sit yesterday, which was a Monday.
I can assure senators we will be sitting next Monday in order to fulfil the business of the chamber before the Christmas break.
Senator Kinsella :
On that basis, I do not think leave is necessary.
The Hon. the Speaker :
Is leave granted?
Senator Lynch-Staunton :
He just felt it was not necessary.
Senator Lynch-Staunton :
Leave is granted.
Hon. Senators :
Agreed.
The Hon. the Speaker :
Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators :
Agreed.
Motion agreed to.
The Senate
Conduct of Business-Notice of Inquiry
Hon. William M. Kelly :
Honourable senators, I give notice:
That on Thursday next, December 11, 1997, I will call the attention of the Senate to the way in which the Senate conducts its business.
QUESTION PERIOD
Federal-Provincial Relations
Reduction in Transfer Payments to Province of Quebec-Request for Particulars
Hon. Fernand Roberge :
Honourable senators, my question follows the announcement made yesterday regarding the government's decision to set at $12.5 billion the cash floor for transfer payments made under the Canada health and social transfer (CHST).
The government would have us believe that this amount represents an increase in health care payments.
However, the figures indicate otherwise.
The following year, in 1999-2000, they will only be $3.748 billion.
Yet, the government claimed yesterday that it was implementing a stable transfer system.
In fact, cash payments paid to Quebec for health and education will be reduced by over $300 million over a five-year period.
Honourable senators, I remind you that these cuts are in addition to this year's reduction of $700 million compared to last year.
Could the minister make inquiries and inform the Senate of the reasons why, in spite of a cash floor set at $12.5 billion, Quebec's share will diminish by $307 million over the next five years?
Hon. B. Alasdair Graham (Leader of the Government) :
The federal government cut its own spending earlier, more drastically and in greater measure than transfers to the provinces.
The government has made it clear that it will use increased fiscal flexibility to make strategic investments in priority areas, and action was taken early and directly on that commitment based on favourable fiscal results that emerged this past spring.
With respect to individual provinces, I do not have those numbers.
However, I would be happy to provide them for my honourable friend.
Senator Roberge :
Could the minister find out at the same time why, in the same time period, Ontario's share of the cash transfers will increase to $173 million?
Senator Graham :
Yes.
While I am doing that, I should like to remind the honourable senator that even before the federal government balances the books, it is putting more money into transfers to the provinces.
In fact, the government is raising the cash floor from $11 billion to $12.5 billion, the single largest reinvestment made by the federal government.
Reduction in Transfer Payments to Provinces-Effect on Atlantic Provinces
Hon. Mabel M. DeWare :
Honourable senators, my figures show that, four years ago, the provinces received more than $19 billion in cash transfers for health, education and welfare through what was then known as the Canadian Assistance Program and Established Programs Financing.
The government's math provides some good news, as the original plan was to give them even less.
The problem is that some provinces will get less under the new scheme while others will get more.
Indeed, seven of the ten provinces will actually see their cash transfers fall even further, including all of Atlantic Canada.
The cash transfer to Nova Scotia will fall from $427 million to $411 million, which is a difference of $16 million.
The transfer for Prince Edward Island will fall from $60 million to $59 million, which is a reduction of $1 million.
The cash transfer to Newfoundland will fall from $281 million to $251 million, which is a difference of $30 million.
New Brunswick will lose $11 million.
The total loss to the Atlantic provinces is $58 million.
At the same time, three provinces, Ontario, Alberta and British Columbia will see their cash payments actually rise.
Atlantic Canada's loss is their gain.
Can the Leader of the Government tell us if his government believes that it is fair to ask the provinces that can least afford it to continue to receive less money year after year by way of support for health, education and social assistance?
Hon. B. Alasdair Graham (Leader of the Government) :
I thank the honourable Senator DeWare for doing the mathematics for me.
I only wish I had done it myself prior to coming into the Senate today.
I would be happy to investigate the reasons why those particular numbers appear in the manner in which she has presented them.
Senator DeWare :
I appreciate that.
It will not matter that we are less able to raise money than the so-called "have provinces."
Honourable senators, because the population of the Atlantic provinces is not growing as fast as Ontario, Alberta or British Columbia, the smaller provinces will get less cash while the larger ones will get more.
The $12.5 billion figure is prorated by provincial population.
Will the government consider the way it calculates transfer payments to ensure that cash transfers to Atlantic Canada, Saskatchewan and Manitoba do not decline any further?
Senator Graham :
I shall certainly bring those very legitimate concerns to the attention of the responsible minister.
Environment
Reduction in Greenhouse Gas Emissions-Support by Provinces of Government Position taken at Kyoto-Request for Particulars
Hon. Mira Spivak :
Honourable senators, on December 1, the federal government proposed that Canada's position at the Kyoto meeting on global climate change would be that developed countries should target 2010 emissions that are 3 per cent below 1990 levels and that Canada should reach the 1990 levels by 2007.
Given the consultation process preceding Kyoto, could the Leader of the Government tell us which provinces and territories support the position that the federal government is currently advancing in Kyoto, and could he also tell us which ones do not support this position?
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, if I were in Kyoto I would be able to offer Senator Spivak a more definitive answer.
I know that the Province of Alberta is well represented in Kyoto, as the Honourable Senator Ghitter has alluded to in the past.
I do not know the positions of the individual provinces.
Certainly there was an enormous amount of consultation at meetings in various parts of the country prior to the Kyoto conference.
The meetings of officials have proceeded for several days.
I understand that meetings of ministers got under way yesterday or the day before and are continuing until tomorrow.
The Canadian delegation is in the midst of negotiations and is considering the best approach for all of Canada.
In that context, I am sure all of those present from the provinces are being consulted.
The negotiations are in a state of flux at the present time and it might be premature for me to speculate on what the outcome might be.
Reduction in Greenhouse Gas Emissions-Target Year for Implementation of Government Position taken at Kyoto-Government Position
Hon. Mira Spivak :
I thank the Leader of the Government for his answer.
I should like to point out that Manitoba is distinct from Alberta, as are all provinces.
In their December 1 announcement, the government also revealed that not until 1999 would they be able to provide more detail as to the costs and specific actions that would be required to meet our Kyoto commitments.
Assuming that it will take some time to implement the actions that the government will propose in 1999, it could be the year 2000, 2001, 2002 or 2003 before the government takes steps to meet its Kyoto targets.
Some of these actions will undoubtedly entail negotiations and agreements with provincial governments, which means it could be as late as 2006 before the government can meet the targets which were set out.
Perhaps the Leader of the Government in the Senate could tell us in which year implementation of the Kyoto decisions will begin, because, surely, that must have been taken into consideration prior to the Kyoto meeting.
Hon. B. Alasdair Graham (Leader of the Government) :
Yes, honourable senators, discussions were held, and consideration was given to when the new objectives or conclusions of the Kyoto conference might be put in place, or kick into place, if I may use that terminology.
I do not believe a final agreement has been reached on that.
I know that the Government of Canada will cooperate with the provinces and territories and, in partnership with industry, the environmental groups and individual Canadians, develop a practical, flexible, step-by-step plan for reducing emissions.
Many economic analyses of potential costs attributable to taking action to reduce emissions have been done, but no conclusions have been reached respecting timing or actual costs.
Reduction in Greenhouse Gas Emissions-Informetrica Study on Meeting Targets-Government Position
Hon. Mira Spivak :
Honourable senators, late last week, the consulting firm Informetrica released a study entitled, "The Scale of the Challenge for Reducing Canadian Greenhouse Gas Emissions."
This report states:
We conclude that there is almost no chance of meeting this goal in Canada under any reasonable economic scenario...
And I stress this last part:
...given current commitments to action.
Could the Leader of the Government tell us if the relevant ministers are aware of this study, whether there have been any responses, or what the reaction has been to this prestigious firm's study?
Hon. B. Alasdair Graham (Leader of the Government) :
It provides very important data.
I am not sure the government would necessarily agree with the findings of the study but, certainly, those findings will be taken into consideration.
Senator Spivak :
I am glad to hear that.
Reduction in Greenhouse Gas Emissions-Concept of Differing Targets-Government Position
Hon. Mira Spivak :
In the current discussions in Kyoto, the idea of tailoring reductions targets to individual countries' economic and social profiles rather than having a one-size-fits-all commitment has gained some currency, particularly in view of the most recent American proposal.
Where does the Canadian delegation stand with respect to this concept?
Hon. B. Alasdair Graham (Leader of the Government):
Honourable senators, the media is reporting, of course, on a possible deal on targets and time-tables which could see Canada accepting a reduction of 5 per cent from 1990 levels bythe year 2010.
At this point, these reports are speculative, but negotiations are ongoing.
National Unity
Recent Remarks of Prime Minister-Possible Conditions of Secession of Quebec-Government Position
Hon. Pierre Claude Nolin :
Honourable senators, I would like to return to the matter of the Prime Minister's statement last weekend on Quebec's secession.
He said in fact last week in Quebec City that he would be prepared to negotiate Quebec's separation, if certain conditions were met.
I would first like to know what conditions the Prime Minister was referring to?
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, the Government of Canada has always said that Quebecers would not be kept within Canada against their will.
That being said, breaking up a country is not a step that one would take lightly.
Senator Graham :
The will of Quebecers to leave must be clearly expressed.
In addition, of course, any process that would lead to secession must respect the law.
Senator Lynch-Staunton :
What does the law say on secession?
Senator Graham :
The government has asked the Supreme Court of Canada to rule on the legality of unilateral secession.
Senator Lynch-Staunton :
I had thought that Mr. Dion answered that question himself on the weekend when he said that a UDI would be illegal.
Senator Nolin :
The Prime Minister has said he was prepared to negotiate.
The Leader of the Government in the Senate has said the government is not prepared to negotiate.
This morning, the Quebec minister of intergovernmental affairs, Mr. Brassard, said, and I quote:
This is what we have always said.
Bear in mind that this minister is a separatist.
I repeat what he said:
This is what we have always said.
Mr. Chrétien has acknowledged that the federal government would negotiate.
Could the Leader of the Government in the Senate tell us under what authority the Prime Minister could negotiate?
Senator Graham :
The Prime Minister would be negotiating on behalf of Canadians, but recognizing at the same time that nine other provinces and the territories are involved.
I am sure the Prime Minister would take all of that into consideration.
Senator Nolin :
The Supreme Court received the request from your government to decide on the issue of Quebec's secession.
We will learn in all likelihood from the Supreme Court that the amending formula would be appropriate if Canadians agreed to allow one province to separate from the others.
Have the Prime Minister, the Minister of Intergovernmental Affairs or officials of your government had formal or informal discussions on this matter with the representatives of the nine other provinces?
Senator Graham :
Not that I am aware, honourable senators.
We are aware, of course, of the meetings that took place with the premiers in Calgary.
We know there is a first ministers' conference later this week in Ottawa, at which this matter may or may not arise.
However, I am not aware that there have been discussions, either formal or informal, between the Prime Minister and the premiers up to this point in time.
Immigration
Tracking and Detention of Unsuccessful Refugee Claimants-Government Position
Hon. Donald H. Oliver :
Honourable senators, my question to the Leader of the Government in the Senate is a continuation of the line of questions I had for the honourable leader yesterday.
Will the Leader of the Government tell this chamber what plans are being considered to detain those who are dangerous, or who are judged to be unlikely to depart of their own free will?
Where will they be detained, and under what controls to ensure that Canadians are protected?
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, I take my honourable friend's question seriously, as I did the questions he put yesterday.
I am still attempting to obtain clarification for him on this matter as soon as possible.
Detention Facilities for Refugee Claimants-Request for Particulars
Hon. Donald H. Oliver :
As the honourable leader knows, the Department of Immigration maintains detention facilities across the country.
Can he tell us how many refugee claimants are presently in detention, the number of centres, and the annual cost to Canadians to maintain these centres?
Hon. B. Alasdair Graham (Leader of the Government) :
Fisheries and Oceans
Negotiations on Multilateral Agreement on Investment-Continuation of Limit on Foreign Ownership of Commercial Licences-Government Position
Hon. Gérald J. Comeau :
Honourable senators, my question to the Leader of the Government in the Senate is in regard to the Multilateral Agreement on Investment.
One of the fundamental objectives of the MAI is to treat non-resident investors as if they were domestic investors; what is called the national treatment principle.
The government assures us that attempts will be made to protect our culture, but the government has also been very vague on the other important sectors of our economy.
Would the minister, therefore, advise this house whether our negotiators will seek to continue the 49-per-cent foreign ownership limit on commercial fishing licences in Canada?
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, I am not sure what is the present position.
I presume that my honourable friend is correct in his assumption, but I will have the matter clarified.
Senator Comeau :
I might advise the minister that indeed there is a 49-per-cent limit on foreign ownership of licences.
Unfortunately, almost nothing has been said by the negotiators as to how they will handle these extremely important issues that impact on all the coastal communities of Canada.
As a supplementary, would the minister also advise whether the government negotiators have been consulting with the fishing industry on this subject?
If so, what has been the government's position in relation to the fishing industry?
Senator Graham :
The answer, honourable senators, is that they have been consulting with the fishing industry.
I believe the position of the industry is exactly as suggested by my honourable friend.
That is something else that I will have clarified for him.
National Defence
Search and Rescue Helicopter Replacement Program-Possible Cabinet Discussion on Awarding Contract for Helicopter Purchase-Government Position
Hon. J. Michael Forrestall :
Honourable senators, did the cabinet consider the awarding of a contract for new search and rescue helicopters this morning?
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, my honourable friend would be the first to recognize that it is not appropriate for me to comment on any discussions that took place in cabinet this morning.
Hon. Lowell Murray :
Would it be appropriate for the honourable minister to let us know whether it was considered last week?
Senator Graham :
The matter of the helicopters is under active consideration by the government.
Cabinet met last Thursday.
Senator Forrestall :
If that is the last cabinet meeting before the Christmas break, I gather we will not see any decision until sometime in the new year.
Senator Graham :
If that is a question, I would hope my honourable friend is wrong, and that I am correct in saying that it is to be hoped that there will be a decision before the end of this year.
Senator Forrestall :
Cabinet will meet again, then.
I am pleased to hear that.
Search and Rescue Helicopter Replacement Program-State of Sea King Helicopter Fleet-Government Position
Hon. J. Michael Forrestall :
Where are the other six?
Are they on ships at sea?
We have 30 in the inventory.
Hon. B. Alasdair Graham (Leader of the Government) :
Honourable senators, the answer is yes, there are 30 helicopters in the inventory.
As I indicated yesterday, 24 were cleared, and six remain to be inspected.
They will be inspected by December 18.
Of the 24 that were inspected, only two were found to be in need of repair.
As to precisely where the other six are located, I would need to consult with the appropriate authorities at National Defence.
I will bring forward an answer for my honourable friend.
Senator Forrestall :
Was there any criticism from our NATO allies with respect to the grounding of these aircraft?
My understanding is that these aircraft are at sea, and a number of them are engaged in some training exercises.
Were we criticized for not being able to live up to our obligations?
Senator Graham :
Not to my knowledge.
It is my understanding that those helicopters are at sea on exercises.
As to precisely where they are, on whatever ocean, I cannot positively say.
It might be a military secret, as a matter of fact.
Federal-Provincial Relations
Reduction in Transfer Payments to Atlantic Provinces Equal to Increase in Social Transfers-Government Position
Hon. Brenda M. Robertson :
Honourable senators, I have a supplementary that goes back to questions raised by the Honourable Senator DeWare.
I will come back to this again tomorrow and the next day.
I should like to know from the Leader of the Government in the Senate whether the cuts we discussed yesterday in the social transfer payments for Atlantic Canada represent the increases in the social transfers that were announced twice previously by this government?
Hon. B. Alasdair Graham (Leader of the Government) :
No, not that I am aware, but it is an interesting question.
I will bring forth an answer.
Delayed Answers to Oral Questions
Hon. Sharon Carstairs (Deputy Leader of the Government) :
Honourable senators, I have a response to a question raised in the Senate on November 25, 1997, by the Honourable Senator Oliver regarding changes to the Canada Pension Plan and the Investment Board; a response to a question raised in the Senate on November 19, 1997, by the Honourable Senator Oliver regarding the Investment Board not being subject to Access to Information; a response to a question raised in the Senate on October 23, 1997, by the Honourable Senator Kinsella regarding commemoration of the 50th anniversary of the Universal Declaration of Human Rights; a response to a question raised in the Senate on November 20, 1997, by the Honourable Senator Forrestall regarding the lack of helicopters for a number of navy frigates; and a response to a question raised in the Senate on November 20, 1997, by the Honourable Senator Spivak regarding the demolition of government laboratories and the possibility of a restoration of funding.
Human Resources Development
Changes to Canada Pension Plan-Accountability and Transparency of Investment Board-Undertaking to Publish Quarterly Financial Statements-Government Position
(Response to question raised by Hon. Donald H. Oliver on November 25, 1997)
Bill C-2 requires that the Board prepare unaudited quarterly statements and provide them to the federal and provincial Ministers of Finance.
The Board may choose to make those statements directly available to the public but the legislation does not require this.
During the consultations on the draft CPP legislation, including House of Commons Finance Committee hearings, several pension fund experts recommended against publishing quarterly statements.
They argued that the routine publication of quarterly results could tend to draw attention away from the longer-term investment objectives of the Board.
Other large pension funds like the Ontario Municipal Employees Retirement System and the Ontario Teachers Pension Plan do not publish their quarterly results for these reasons.
For a pension fund, long-term investment performance is paramount.
Changes to Canada Pension Plan-Investment Board Not Subject to Access to Information Act-Government Position
(Response to question raised by Donald H. Oliver on November 19, 1997)
Applying the Access to Information Act to the CPP Investment Board would be inappropriate.
The Board's mandate is to invest CPP funds at arm's length from governments in the best interest of plan members.
As an investment institution, much of its day-to-day activities will be commercially sensitive and would be exempt under ATI in any event.
While ATI does not apply to the CPP Investment Board, by legislation and regulations the Board's operations will be very transparent and it will be subject to close public scrutiny.
For example, the Board will be required to:
- make public its investment policies, code of conduct, corporate governance practices, proxy voting guidelines, and by-laws
- disclose the compensation of the five most highly compensated officers of the Board
- prepare quarterly financial statements that will be sent to federal and provincial Finance Ministers, and an annual report that will be tabled in Parliament
- hold regular public meetings in each participating province to allow for public discussion and input
Universal Declaration of Human Rights
Commemoration of Fiftieth Anniversary-Plans of Government
(Response to question raised by Hon. Noël A. Kinsella on October 23, 1997)
The 50th Anniversary provides Canadians an opportunity to reflect on the importance of human rights in the life of the country, as they are a fundamental unifying value and an important part of our legacy to future generations.
The objectives of the commemoration are to promote respect for human rights and responsibilities; mark Canada's national and international progress in implementing human rights standards; develop innovative and responsive approaches to emerging human rights issues; and, to link values highly esteemed by Canadians - values such as respect for the rule of law, dignity of the person, fairness, equitable treatment and democratic participation - to a broader government agenda related to social cohesion and social justice.
Activities planned around December 10, 1997 for the launch of the 50th Anniversary commemorative year of the Universal Declaration of Human Rights (UDHR)
National Defence
Lack of Helicopter for Number of Navy Frigates-Government Position
(Response to question raised by Hon. J. Michael Forrestall on November 20, 1997)
An eleventh detachment is required for Canada's full time commitment of one ship to NATO's Standing Naval Force Atlantic.
Maritime Command employs a three-tiered approach to fleet readiness: ships fulfilling national commitments are at High Readiness; ships in refit or major maintenance periods are at Extended Readiness; and, the remainder of the fleet is at Normal Readiness.
Ships at Normal or Extended Readiness do not normally require Sea King detachments to fulfill their operational role.
As well, certain taskings such as sovereignty, coastal and fisheries patrols may not require a Sea King detachment.
Therefore, ships can be deployed at sea and operationally ready for a mission without a Sea King detachment embarked.
Forestry
Demolition of Government Laboratories-Possibility of Restoration of Funding-Government Position
(Response to question raised by Hon. Mira Spivak on November 20, 1997)
In response to the federal government's Program Review, the Canadian Forest Service (CFS) underwent strategic restructuring to rationalize its operations and to reduce infrastructure costs in the interest of providing maximum funding to research within the context of a reduced operating budget.
As a consequence, Petawawa National Forest Institute (PNFI) was identified as one of the several Natural Resources Canada (NRCan) operations to be closed as part of a redefined departmental initiative to refocus our Science and Technology (S&T) programs.
These programs address issues of national and international significance and service our clients through stronger, more effective partnerships with the provinces, industry and other players in the forest sector.
All the major programs from PNFI have been transferred to the five current CFS research Centres and accordingly the majority of basic research activities from PNFI are ongoing.
Claims of expenditure for upgrades prior to decommissioning were in fact for operational maintenance, purchase of equipment and some site enhancements.
With the closure of the site all research equipment and transportable assets relevant to ongoing program activities have been moved to other CFS research Centres with their respective researcher's programs.
The final phase of deconstruction has been delayed twice in order to seek alternate tenants for the townsite.
The site in its current state represents a safety risk both in terms of security and liability and requires significant annual expenditures for heating and infrastructure to simply be maintained.
Answers to Order Paper Questions Tabled
Energy-Department of the Environment-Conformity with Alternative Fuels Act
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 13 on the Order Paper-by Senator Kenny.
Energy-Department of Justice-Conformity with Alternative Fuels Act
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 26 on the Order Paper-by Senator Kenny.
Energy-Department of Multiculturalism-Conformity with Alternative Fuels Act
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 31 on the Order Paper-by Senator Kenny.
Energy-Department of Natural Resources-Conformity with Alternative Fuels Act
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 34 on the Order Paper-by Senator Kenny.
Defence-Status of Clothe the Soldier Project
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 60 on the Order Paper-by Senator Forrestall.
Defence-Status of the Armoured Personnel Carrier Replacement Program
Hon. Sharon Carstairs (Deputy Leader of the Government) table the answer to Question No. 61 on the Order Paper-by Senator Forrestall.
Business of the Senate
The Hon. the Speaker :
Honourable senators, before I call Orders of the Day, I wish to remind honourable senators that we will be taking the official photograph of the Senate tomorrow at 1:30 p.m.
ORDERS OF THE DAY
Canada Pension Plan Investment Board Bill
Second Reading-Debate Continued
On the Order:
Resuming debate on the motion of the Honourable Senator Kirby, seconded by the Honourable Senator Joyal, P.C., for the second reading of Bill C-2, to establish the Canada Pension Plan Investment Board and to amend the Canada Pension Plan and the Old Age Security Act and to make consequential amendments to other Acts.
Hon. David Tkachuk :
However, there are a number of important issues that we believe are relevant and important not only to this side of the house but to all senators.
Some senators, including me, are interested in this bill from a personal point of view as well.
This bill was brought in last week so that we could work on it.
Now, we must complete that work and pass the bill by Christmas.
I do not think that we are handmaidens.
We do not have to take orders.
We must do what is right.
This bill has important consequences for many of us, and more particularly, for our children and our grandchildren.
Those people who are already retired and at the age of 65 will receive all their benefits.
For those people who are in the middle and who will soon be retiring, it is not a big problem for them.
They will have some reduced benefits and some increased costs.
To those people who have been paying all their lives - that is, all the baby boomers who will begin to turn 50 - they will receive benefits and be faced with another 15 years of increased costs.
I will tell you for whom this is important.
I have a daughter who is 24 and a son who is 21.
Many of you have children and grandchildren.
The government is asking them to pay 9.9 per cent - I am sure it is 9.9 per cent because the minister wanted the number to be under the figure 10. That represents 10 per cent of their income, and it will increase with inflation.
The $35,000 that they pay on today will inevitably be more tomorrow.
As inflation eats away at it and the numbers rise, that number remains the same.
This goes against everything we have ever done on this program since its inception in 1966.
It stays the same.
In 10 or 15 years, that $3,500 will be worth $1,500, $1,000, $500, depending on what government does and what happens to inflation.
Senator Taylor :
Elect the Liberals and it will be high!
Senator Tkachuk :
If we elect the Liberals, inflation will be high?
We already know that!
Let me continue in that vein.
Perhaps honourable senators opposite do not want to hear what Paul Martin will be doing, and the explaining that you will have to do back home in 10 or 15 years when your children ask you what you did about this bill.
When they retire, their CPP benefits will be worth about what they put in, plus 2.5 per cent.
I do not get it.
I do not understand why we are being asked to do that to our children, so that those who are retiring today can receive full benefits and those who are retiring soon can get their benefits.
I do not get it.
I will try to explain it today, and - I hope I can convince you.
The CPP is part of a larger program that Paul Martin is introducing.
Everything involves reform.
We will have a reform of the Old Age Security benefit, which is coming up after Christmas.
It is important to get through this before Christmas so that we can consider changes in the cut-backs that will come due after Christmas.
We on this side think that both matters should be discussed together because it is part of a pension program and a part of a social security net for people in this country who retire at 65 and who want to retire with some dignity.
We strongly believe that this measure is a payroll tax and a job killer.
Yesterday, Senator Kirby said it was not a payroll tax.
The Department of Finance did a study in April 1995 which was reported in The Toronto Star .
The study noted that the relatively modest increase of CPP premiums between 1986 and 1993 resulted in 26,000 fewer jobs.
It further noted that the increases have had and will continue to have a negative impact on the labour force.
That contradicts the government's arguments that CPP premiums are not a payroll tax but, rather, a pension contribution.
In their own report, the Department of Finance stated that employers' contributions to CPP and the Quebec Pension Plan are part of the compulsory payroll tax.
The department warned against higher payroll taxes in that same report and called this tax just that, namely, a payroll tax.
We on this side strongly believe there are a number of important issues contained in this bill that we should discuss before it is passed.
There should be decreases in other taxes, perhaps other payroll taxes such as the employment insurance payroll tax, to make up for the increases in the CPP, so that the negative impact on jobs will not be felt as strongly.
We should have a full evaluation of any changes to the Old Age Security system and how it will affect future incentives to save.
The Auditor General should have free access not only to the fund but also to the board itself, lifting the limits on RRSP contributions so that people can have an opportunity to look after themselves, and removing the foreign investment restrictions on RRSP investments.
Honourable senators, there are elements of truth in all things nefarious.
That is why we call it propaganda.
The government is an accomplished practitioner in this art of propaganda, with their plea to save the CPP and their prediction of dire consequences if action is not taken today, this minute.
They made only token consultations.
Invoking closure on the debate on Bill C-2 was the first indication of the government's intention.
Now we are being told in the Senate by the government that it is important to act now because the Minister of Finance has an agreement with the provinces.
The government's usual modus operandi is diversion, mixed with a little fabrication.
It was convenient to have the diversion of a postal strike with its ensuing back-to-work legislation before the house while Bill C-2 was being introduced in the other place and closure was being imposed.
It was also convenient for the government to falsely accuse the former prime minister of criminal intent and behaviour after its incompetence was fully exposed to the Canadian public following the Quebec referendum.
It is not a question of means justifying the end.
In this bill, the means and the end are equally wrong.
Time allocation has been imposed seven times on other bills, most recently on third reading of Bill C-22, the Pearson airport bill.
It was imposed on Bill C-110 which proposed certain constitutional amendments; on Bill C-12 which dealt with employment insurance; and on the committee report on Term 17.
It is becoming a habit; a habit that is hard to break.
Bill C-2 is just another in a series of bad bills, incompetent work and dictatorial action.
It was introduced last week in the Senate, preceded by time allocation in the other place.
With passage of this bill, the government will be imposing the largest tax grab in the history of the country.
Canadians are unaware of what is happening, in particular our young people who will be the most affected and the most mistreated.
We owe it to them, our grandchildren and our children, to study this legislation thoroughly and to amend it, because it is not their fault that this program has been so badly managed.
They will have little chance of collecting under the CPP, hence the changes the government intends to make.
We are simply shovelling our hard-earned money into the greedy hands of Paul Martin, Minister of Finance, who wants to be the man who slays the deficit dragon, and we know how he intends to do it.
He has followed three policy themes to accomplish that end.
First, he has transferred much of the tax burden to the provinces, forcing what I call "downloaded increased taxes."
Provincial and municipal governments, who were receiving less money, had to increase taxes.
The government transferred debt.
Second, this government has taken advantage of the low interest rates which resulted from the efforts of the Conservative government over eight years to bring the deficit and inflation under control and to bring interest rates down.
Third, Paul Martin then not only raised licence fees and taxes, he used the accumulated surplus in the EI fund to pay down the deficit.
It is this third policy theme with which we, on this side, feel most uncomfortable.
He used the surplus in the EI fund, not to extend benefits, not to reduce premiums - which is normally what is done in a payroll deduction - but to cut benefits for a totally separate policy objective.
He used this payroll tax purely and simply, to achieve his policy goal of cutting the deficit.
That is why the Auditor General is prohibited from examining the fund unless the directors of the fund agree.
It should not be for the directors to agree or disagree.
Parliament must insist that the Auditor General report to us on the fund and on its administration.
However, the Auditor General will report to the directors of the fund on how they manage their affairs.
That is not acceptable.
We are talking of $100 billion by the year 2006, and rapid increases thereafter.
On this record, it will fail.
It is an anomaly of governments to charge taxes for employment insurance premiums, and then reduce services to accumulate a surplus to pay down a deficit.
It then writes cheques for something else.
The government charges taxes for transportation then imposes user fees at airports and tolls on highways for the right to use the airports and highways that we have paid taxes to build and maintain.
It imposes taxes to create historical sites and national parks and then charge people to get in.
It charges premiums for pensions but, by the way, cannot pay those pensions, so the government has to charge us more.
Look through the bill.
It is simply paying more money for less benefits.
Anyone can do that.
Even the Liberals can do that.
The government is unable to manage the present program so it wants more money to enable it to manage it better.
We must remember that the author of Bill C-2 is Paul Martin.
Paul Martin is a real smart guy.
We remember that he had to stoop to bribing three Atlantic provinces, with other people's money, to fulfil his promises of harmonization.
He later apologized to the Canadian people for misinforming them.
Meanwhile, the Prime Minister and Deputy Prime Minister, Sheila Copps, were promising to get rid of the GST, but they did not really mean it, they said, although they were caught out on tape not telling the truth.
Paul Martin promised in the old Red Book that the government would cancel the helicopter purchase and use the money to pay for more social programs.
Now, $900 million later, we have no helicopters that fly safely.
He penned the Red Book to renegotiate the free trade agreement.
He took all the kudos after the 1993 election.
Now he says: "Rush Bill C-2.
Trust me."
The minister says that he needs the bill now to satisfy an agreement with the provinces.
I have heard of no agreement.
No one here has heard of an agreement.
If someone on the other side knows of an agreement, please tell me.
We have not heard one province asking us to abandon our parliamentary responsibilities and rush this bill through by January 1 on the threat that they will cancel their agreement.
The Minister of Finance is rushing so that he can get another $400 million in taxes for the 1997 tax year.
The brunt of this bill is being borne by middle- and lower-income workers.
Merry Christmas Canada.
Let us give Canadians a Christmas present by defeating this bill.
Let us kill the bill.
We are well aware of the Liberal record.
We resent the fact that this bill will not be given full Senate scrutiny.
We also know what will happen when things go wrong with this bill, as they will.
I outlined the government's record on making promises.
We know its record on responsibility.
I can just see it.
When this bill is in shambles, Paul Martin will be 95.
Jean Chrétien will be 95 or 96 or 102.
Senator Taylor :
They will still be in power.
Senator Tkachuk :
He will not take responsibilities.
The Grits will never take responsibility for their actions, as they did not when they cancelled the Somalia inquiry, and when they made false accusations against a former prime minister.
I don't know who, but I'm not responsible."
There was not an iota of evidence to prove that what they were saying was correct.
They did not take any responsibility after cancelling the EH-101 contract.
They are still talking about it in cabinet.
Nor did they take any responsibility after their failed strategy in job creation.
Nor did they take responsibility after almost losing the country in the Quebec referendum.
"Trust us," they say.
One thing we can count on is if this government says it is good for Canada, it is not good for Canadians.
At the time of the 1966 social contract with Canadians, the Liberals were in power.
They entered into a social contract with their citizens.
It was they who did it.
"We will take your money and provide you with a pension," they said.
As soon as they got their grubby hands on the cash, it was lent to the provinces at favourable interest rates.
They were cheating Canadians who trusted that when they got old, they would have a pension.
Baby boomers, who have paid all their working lives since the program's inception, now have the audacity to reach 50.
We have had the audacity to reach 50!
Senator Cools :
Not me.
Senator Tkachuk :
Then they had the gall to limit their breeding, thus causing a situation whereby, 15 years from now, there will be fewer people working to pay for the people who turn 65 at that time.
They limited their breeding.
From what we know of social behaviour during the 1970s, abstinence was not the order of the day.
People were, shall I say, "fuddling".
It was not their fault; it was the fault of scientists.
The cause, they say, was social behaviour.
That is what caused the end of this pension plan.
It is one other social plan gone astray.
The good old days are gone.
We have another problem.
People live longer.
Again, science has interfered with a social plan.
Retiring at age 65, dropping dead three to six years later, depending on your gender, was good for governments.
At its inception in 1965 - payments started on January 1, 1967 - in order to be eligible for CPP benefits, you had to be 68, and 68 was about the same year that the average male died.
It was the perfect pension plan:
Pay all your lives, and then die just as the first cheque is put into the mail.
If there was a postal strike, the government had the benefit of both worlds - the pensioner was dead and the cheque was in the mail.
From the beginning, the CPP was simple, but it was misnamed.
It was misnamed because it is also a life insurance program.
However, it is a silly program when it is part of a pension plan.
Instead of cancelling the benefit, there is an argument made as to whether it should be means tested when cancelled or not.
That is an area where we can save a lot of money because, as people are dying today, cheques are going out in the mail, at $3,500 a shot.
Yet we do not have enough money to pay proper pensions when people are alive.
It is also a disability program.
There is nothing wrong with having a disability program, but it is part of the Canada Pension Plan now.
It is part of a payroll tax to buy universal disability insurance, and then the social engineers took over.
I want to give senators an historical perspective.
There have been many amendments made over the years to the CPP.
Yet, the government has said, "We will not touch that fund."
However, they touched the other fund.
Since 1973, they have been making new legislation and implementing new programs.
Why will they not use the fund that will accumulate on the other side, over which Parliament has no control?
We saw this stuff today when we were studying the Estimates.
The government has said that we did it, as Tories.
However, the Liberals were in power a lot longer, so they are much more responsible.
Retirement and earnings tests for individuals were eliminated in 1974.
Benefits were provided to male and female contributors, to surviving spouses and dependent children.
However, instead of taking it out of general revenue, the government took it out of the CPP because, in the old days, there was lots of money in that fund.
There were not as many old people.
There was a great number of working people, and lots of cash.
They said, "We can throw it around."
No one was thinking what would happen when people in the large demographic group turned 65.
The amendments provided for the elimination of CPP children's benefits which previously applied - they changed it again - where more than four children of a deceased or disabled contributor had been eligible for such benefits.
Now, if you have more than four kids, that is fine, too.
However, it was another increased cost to what should be a pension plan.
The government should have taken the money out of something else, or increased the amount of CPP premiums so that people were told the truth, and also told, "To pay for this it will cost you 10 cents or 20 cents more a month."
The cash was there, so they used that cash.
Legislation was enacted for spousal credits.
When people get divorced, they have to keep up with the times.
They can split the benefits.
That was not done before.
At the inception of this program, that was not allowed.
Because men die earlier and women live longer, the money went mostly to women.
It costs more money.
I am not saying that is bad.
I am just saying that all of a sudden it costs more money because women are either lucky or live better or cleaner lives than men, and they live longer.
Senator Gigantès :
They survive us.
It takes strength and intelligence.
Senator Moore :
Meaning we are not intelligent?
Senator Gigantès :
Not as much as the women are.
Senator Tkachuk :
Then the benefits were extended.
The provision went from having to live together for seven years to share in CPP benefits - in other words, when one died the other one would pick up the cash - down to one year.
If you lived together for one year, the other person was considered your husband or your wife, and benefits again were extended to the surviving spouse - another increased cost.
Yesterday, Senator Kirby alluded to the possibility that there may be other social changes in those arrangements.
I know what that means.
It is possible that governments may recognize gay marriages, and I think he wanted to let us know that there may be these kinds of changes taking place.
That is fine, if the government wants to do that.
Now you have two guys living together; one dies, the other one is picking up some cash.
That costs more money.
Well, two guys who live together for one year may not be gay.
How would you know?
Senator Gigantès :
You want surveillance cameras?
Senator Tkachuk :
So there is an opportunity for fraud.
This is not a pension program.
Let us make that clear.
This is a payroll tax to pay Old Age Pensions, disability, life insurance, benefits to survivors, orphans, children, or exemptions for child rearing.
We did not have that either, and there is nothing wrong with that.
They decided that seven years of child rearing would make you part of the CPP labour force, and therefore you can get benefits.
That is a social program; a good social program, but it is coming out of the pension fund.
We have spent all this cash over the last 30 years and we say now, "Oh, it is not our fault.
It is not legislators' fault.
Senator Gigantès :
Are you quoting the Reform Party?
Senator Tkachuk :
I do not think so, although I have a few things to say about Reform here too, which I will get to right away.
I would like to quote Preston Manning's comments from Tuesday, October 28, in committee.
These are the other guys in the other place.
He was speaking of Martin and Pettigrew.
The alternative we would like the committee to consider rests on four pillars rather than three: the seniors benefit, which is targeted to lower-income people; a smaller, more focused CPP, not a scrapped CPP;
There is the big change from the last election.
...an expanded RRSP program; and tax relief to seniors.
We will argue that our four-pillar plan delivers more retirement income per dollar invested than this three-pillar plan the government is putting forward.
I think I have explained some of the ideas we got from the government side.
The liability of $600 billion becomes unfunded if we all quit paying CPP premiums, but the obligations still have to be met.
That is what Reform was proposing through the election campaign and over the previous four years.
They have changed.
Now they want a smaller CPP.
However, Preston Manning could never explain the first program.
Now they have a CPP program which they wanted to explain to the minister in committee.
Well, they could not get it together.
Preston Manning, who made a promise to do it before committee meetings ended in the other place, failed to do it.
I can see why.
They are making false accusations in the House about people.
It is the typical Reform program we have come to expect.
They are off in left field somewhere, although I do not think they would want to be described that way.
Now they want to create a super-RRSP, which does not make any sense because, not only is it at odds with what they said in committee and what they said in the election campaign, it does not fit into their tax plan.
Remember, they have a tax plan with a flat tax.
With the flat tax, you reduce the amount of exemptions.
We are not getting any ideas from them.
Now I will turn to the Liberals.
Senator Gigantès :
Be careful.
Senator Tkachuk :
Since taking office, they have taken $300 million in new taxes from senior citizens by income-testing the age credit.
They want Canadians to mature their RRSPs by the year they turn 69 rather than the previous age limit of 71.
However, seniors do not know about it, and this will be another huge tax grab - Merry Christmas, Canada - by the Liberal Government and Paul Martin.
Twice they have killed plans to increase the RRSP contribution limits so that people could put money away for their future given that the government will not provide for them.
The Canadian Association of Retired Persons says that as many as 80,000 Canadians may fail to convert their RRSPs on time.
Where are the big advertising programs of the Government of Canada which they mount when they really want to advertise something?
This is a government program they do not want to advertise.
They want it to slip in, just like this bill, so that people will not know and will not make the proper financial decisions, but instead will be exposed to a huge tax load for the year 1997.
That is what Paul Martin wants, so that in February he can brag in his budget speech about how he has cleaned up the deficit - on the backs of the unemployed, on the backs of senior citizens, and on the backs of young people who will be paying the $400 million to the new pension plan.
Senator Gigantès :
That is because over nine years you did nothing to address the deficit.
Senator Tkachuk :
That is not true.
The only reason the federal government is dealing with the situation now is that the minister of finance at the time, Michael Wilson, obtained an agreement that created a certain situation.
There is a word in law for something from which one cannot extricate oneself, and where a decision must be made.
That is why they have an agreement today.
We tried to get it done in 1986.
Senator Gigantès :
And you failed.
You could not do it.
Senator Tkachuk :
Because the Liberals would not agree.
I will defend my government, and my honourable friend will defend his.
I will not delve too far into the OAS because there are other speakers who wish to deal with this issue over the next two weeks.
Perhaps we, as senators, will be able to discuss this matter well into the new year, which I hope we do.
Senator Gigantès :
You are reading from the wrong script.
Senator Taylor :
It is obvious that my honourable friend does not have any notes.
Senator Tkachuk :
I think I am getting to honourable senators opposite.
I was told by the Honourable Senator Kirby that members opposite would only have one speaker on this issue.
I have a feeling that we may hear from a few more senators after I and other senators point out some of the weaknesses in Bill C-2.
Honourable senators, I would reiterate that this is not a pension program: this is a payroll tax!
In the past, it harboured cheap loans for provinces, and it will harbour a $100-billion fund that will grow to a $1-trillion fund.
Honourable senators, we will not need to pay the price.
We will be long gone before the young people who starting out now, and who expect a pension plan when they grow old, will reap the benefits of what we sow today.
Honourable senators on this side and honourable senators on the other side, I do not know why you would want to rush this bill.
What is in it for you?
What is in it for the Minister of Finance?
What is in it for anyone to rush this bill through Parliament by December 19?
No reasonable explanation has been given to me, and I am sure no reasonable explanation has been given to my honourable friends, other than the PMO, Mr. Goldenberg and Mr. Martin, telling you to pass this bill by December 19.
They are telling you not to think about the consequences, because they are right.
How do we know they are right?
Why not take more time, honourable senators?
Senator Gigantès :
Having listened to you, we know they are right.
Senator Tkachuk :
Why not take the time -
Senator Gigantès :
And the tedium?
That is what we need to tell them at Christmas when we go home; not that we passed the bill.
Hon. Roch Bolduc :
Honourable senators, I will not go back over the very important points raised by my colleague with respect to the intergenerational inequity in this bill.
I would like to look at other aspects of the problem.
Honourable senators, the government is proposing to amend the CPP.
I would have found it appropriate to examine all the major aspects of the plan at this time.
This has been done for some important facets such as its survival, its management and its performance.
I will address these shortly.
This strikes me as an important question.
Why, for instance, if I do not wish to contribute and prefer to look after my own financial security, should I be obliged by law to participate in the plan, even if I am prepared to sign a document absolving the government of all responsibility on my account?
Why must everyone belong to a plan whose money will be invested by others, by public servants?
The government's response to this fundamental question is obligatory collectivization.
The government seems to assume that Canadians are irresponsible, ignorant, and improvident, and that big brother in Ottawa knows best.
If he is so competent, what has this big brother been doing for 20 years?
He agreed to give pension benefits to people, but forgot to levy what he needed to be able to do so, and what he levied, he loaned to the provinces at such low rates that, unless there are drastic changes, the plan will go bankrupt.
Here we have a classic case of public mismanagement.
On the one hand, they hand out goodies and, on the other, they forget to charge for them.
And now they have learned nothing from this sad tale:
Ottawa is asking for even more from everyone and tells us that this time it will invest the money wisely and that it will be for the future good of all.
Honourable senators, I would much more prefer looking after my own retirement, and I know many Canadians who would like to be free to do what they want with their own money.
There are many other aspects of this bill that require serious consideration, but I will deal here with only one or two.
The bill provides for the creation of a government agency responsible for investing the funds collected from contributors to the Canada Pension Plan.
This agency will have more or less the same powers as the Caisse de dépôt du Québec.
The management of these funds will therefore be given to a government monopoly, as was done with the generation and distribution of electricity.
However, how can the performance of a monopoly be assessed?
And do you know of any monopoly where unacceptable mismanagement did not occur at one time or another?
There is a long list of unfortunate cases of poor management - we have all heard stories of the extravagant expense accounts of people in the public sector who think they own the jobs they are holding - of bad investments, such as those made in real estate by an agency like the one we are creating, for example, of consumer gouging - we have seen monopolies charge excessive rates, because they were the only ones providing the service - of unreasonable benefits, such as complete job security for employees at the expense of the taxpayer - as has occurred in crown corporations you are familiar with - of differences in economic and social objectives - this also happened when an agency was created and given a mandate, and then after 15 years, it started doing something else, we have all seen this - of conflicts of interest involving officials who make no difference between their personal interest and that of the public, et cetera.
There is a long list of horror stories involving monopolies.
The whole history of the public sector, here and elsewhere, is full of such unfortunate incidents.
I will not speak here about what occurred in Eastern Europe or in the Communist Bloc.
But in this country and in countries like France and England, such cases have been a constant feature of the past 15 or 20 years.
You may tell me that such things also happen in the private sector.
Of course, but in this case it is everybody's money that is at stake, and not just private funds.
That is why careful consideration must be given to this proposal for a new government structure.
I am referring to the Investment Board.
All the contributions will be invested by this so-called Investment Board.
I would like to start by saying that in 10 years, we will have a government agency managing some $150 billion.
Do you realize how much power these people will have?
Every week, every Monday morning when these people arrive at work, they will find in front of them millions and millions of dollars that they will have to invest immediately.
Three billion dollars is $3,000 million.
Theoretically, this is $600 million a day.
This has to be invested right away, it cannot wait until the afternoon.
Do you think that the heavy machinery required for these operations will be efficient?
Impossible, honourable senators.
There will be lost efficiency, which means financial losses.
Those who believe that "big brother" will be kinder than the community of specialists in the private sector are seriously wrong.
Even for the private sector specializing in this type of operations, whether mutual funds, national brokerages, or trusts, when the volume exceeds $50 or $60 million, the performance ratio is not proportional to the volume of the funds being managed.
Private enterprise is aware of that.
It seems only the government is not.
The huge monopoly to be created presents a very high risk of inefficiency, of bad investments, and therefore of poor performance.
Why should everyone be obliged to contribute, to provide funds to a manager who may do a worse job than the person who actually owns those funds?
If some are deemed to have not done a good job, they are replaced, something is done about it.
We are familiar with the virtues of competition in the private sector, which results in a raised level of performance.
That is good for the consumer, so why would it not be applicable to this particular type of services?
Analysis of investments, or the decision as to the choice of investment for a business, is a highly technical undertaking, but also a risky one.
This is why, in all wisdom, we must not "put all our eggs in one basket," as the old saying goes.
Ought we not to have a number of baskets instead, so that any one bad decision will not be a huge disaster?
This diversification of investments is wise; ought it not to be institutionalized in the law, and ought not the number of independent responsibility centres for investments to be increased?
My third point concerns the relationship between the government, the Minister of Finance in particular, and the agency in question.
It will always be tempting to use these funds to finance governments, at lower rates than if it had been invested in the open market.
That is, in fact, what has been done since 1996 under the present system.
It must be ensured that a conflict of interest of this kind is not permitted at all.
I will return to this shortly.
My fourth point concerns investment policy.
The law should provide that the administrators of the fund are responsible for ensuring contributors a reasonable pension, while providing them with the best return, that is, the safest and best return possible.
Canada's economy represents about 2.5 per cent of the world economy.
So it would be wise to permit the fund not only to diversify its investments in stocks and bonds but also to invest worldwide.
Diversification of values, in a variety of instruments, in various sectors, in different countries and currencies is thus a measure of wisdom and judgement to be left to those in charge, who must, of course, be accountable for their actions.
Honourable senators, it would be tempting for the administrators to act as investors on occasion by investing in all sorts of businesses with their judgement either arbitrary or verging on patronage.
We have seen this in Quebec.
There must be strict rules to prevent this sort of thing, if we want to avoid regrettable misuse.
The matter of the pension plan's objectives is basic.
In this respect, the legislation must be clear.
The board must first and foremost look after the interests of the contributors whose income security depends on its performance to a large extent.
The history of the Quebec Caisse de dépôt et placement warrants examination in this regard.
In the mid-1960s, at the time it was set up, Mr. Lesage, the Premier of Quebec at the time, described it as an instrument of social security.
He added, at the instigation of some, that it would also be an instrument of economic development, with the result that, little by little, the managers who were not sufficiently dynamic in the eyes of the directors were replaced.
It was not Mr. Caouette's money, it was real bucks.
The second director was also an experienced investment fund manager, but the government changed in Quebec, and we ended up with people who were more dynamic and who wanted to direct the economy.
That is when it was decided that the people running the Caisse were not dynamic enough and had to be replaced.
That was done.
That is how a deputy minister of finance came to be the president of the Caisse de dépôt et placement du Québec at a time when Finance Minister Parizeau was a very influential member of the Lévesque cabinet.
This led Quebec industry leaders and other stakeholders to raise all sorts of questions about the policy and management of the Caisse under his direction.
You know the arbitrary risks inherent in choosing the companies in which the board can invest.
Of course, there are provisions to limit the ratio, but everyone knows that the percentage of shares required today to control a company is relatively small.
Can you imagine what kind of arm-twisting this will lead to?
To collectivize an operation is to politicize it.
That is what we are doing here, notwithstanding the precaution taken to maintain the board members' independence from the government.
Even if we are told that they will come from outside the government and operate at arm's length from the government, we must be realistic.
I would now like to address an important aspect of the bill, namely the impact of the plan on the two pillars of income security mentioned by Senator Kirby.
The 25 or 30 per cent amounting to $22 billion a year goes to old age pensions.
Every year, we save $80 billion, or 10 per cent of the gross national product, which goes to income security, including $22 billion from old age pensions, $23 billion from the Canada pension fund and $30 billion or $35 billion from private pension plans.
Savings coming from private pension plans should remain stable in the future or else get smaller depending on the decisions we make.
Contributions will increase by 70 per cent within five to seven years.
I think the amounts will remain stable, but they could also drop, if this increase is not compensated by an equivalent decrease in income tax, for instance.
As for RRSPs, they are likely to diminish if employment insurance contributions and taxes are not lowered.
In my opinion, we will likely see a reduction in private savings, along with an increase in public savings.
Is it a good thing to increase the role of the state?
This is what is being done here.
It implies that if it is in the public domain, the money will be better invested than if individuals invest their savings in the private sector.
Who can possibly think that it makes sense?
What happened in the past?