Statement made on 26 November 2009 by Senator Joseph Day
Hon. Joseph A. Day:
Honourable senators, it is my pleasure to join in the debate on Bill C-51. Honourable senators will be looking in their desks for this particular bill and I remind them it is the second budget implementation bill for Budget 2009.
Honourable senators, I would like first to compliment the Deputy Chair of the Standing Senate Committee on National Finance for his very fine speech in introducing this particular bill as the sponsor. Apart from the odd political jab, I found most of his comments to be comments with which I can agree.
Honourable senators will recall, however, that the honourable senator referred primarily to two or three aspects of this bill. I thought, therefore, that I would spend my time in bringing to the attention of honourable senators just what is in this particular Bill C-51, budget implementation.
The best place to start, honourable senators, is to read to you again the description of Bill C-51:
An Act to implement certain provisions of the budget tabled in Parliament on January 27, 2009 and to implement other measures.
Honourable senators ". . . and to implement other measures," means that it is like all those other bills we have seen in the past that pretend to be budget implementation measures. They contain one or two particular aspects that look quite attractive, they sometimes have time restraints, and there are always many other aspects. I do not suggest a conspiracy here, but it is an attempt to get some small items off the plate by adding them to this bill.
Honourable senators, in the past we have made the mistake of focusing, as my honourable colleague did in presenting this bill, on the good and avoiding the bad and the ugly. It is important to look at the entire bill and understand what it contains.
At second reading, honourable senators, we look at the bill in principle. I will not be delving into the specific clauses that appear in the bill, but rather dealing with the overview and how that might impact on our regions and the people we represent.
The first point I would like to make is with respect to the Home Renovation Tax Credit. From all reports that we have read, this appears to be quite an attractive initiative. It ends, as honourable senators will know, at the end of January of next year, in just over two months. The funds must have been expended and the goods or services received. It is important to advise your constituents that the renovations cannot be in the form of a contract that is to be executed beyond January, 2010.
My concern with respect to the Home Renovation Tax Credit is that although it has been extensively advertised, we will not know how much take-up there has been until people file their income tax next April. However, the very extensive advertising is for a government initiative that could have been brought to Parliament much sooner than it has. This is the second budget implementation bill.
I ask rhetorically why this would not have been included in the earlier legislation. Why are we only seeing this now as legislation when it has been advertised for nine months? They have been telling the public you must do this before a certain date. There are only two months left within which they can do take advantage of the program. The conservative individual will say he or she cannot commit under that program until Parliament says this is the law.
We did not vote on the budget. We vote on budget implementation in this chamber. This is the second bill. I ask myself, what would happen if we, the Senate, rejected that particular clause? Think about that. You and I know that would cause some considerable upheaval.
Are we even expected to look at this thing? Why are we here when the government has advertised a fiscal measure that requires Senate approval, advertised it so extensively that we can not possibly do anything but pass it? That, honourable senators, is my first concern with respect to the process in relation to this particular measure.
When we look at this in the next fiscal year, I suspect we will find that it has been fairly heavily subscribed. There may well be those who would like to see it extended for another year, assuming we are not seeing the recovery that we would like to see. Is this one of those measures that should be extended for a further period of time?
I remind honourable senators that this time last year there were 450,000 more people working in Canada than there are today, and the government's projections are that over the next year 200,000 more people will be unemployed. That is 650,000 homes that do not have the earned income they had in the past.
We may well, honourable senators, be looking at a prolonged recession that requires other activities. Goodness knows how some of these initiatives are going to work. All of that is for us to review in the future.
One other initiative, honourable senators, is for first-time home buyers. Nothing need be said further about that. It is another initiative that focuses on a particular segment of society. This government decided in its wisdom that a $750 tax credit to first-time home buyers would help stimulate the economy.
Working Income Tax Benefits, honourable senators, is another area that really does not need a lot of explanation. Individuals earning an income at the very lower levels now have a larger tax credit so that they do not have to pay quite the same level of tax. This measure is worth considering.
Honourable senators, the Canadian Broadcasting Corporation appears in this bill. Honourable senators will understand that the CBC, a public broadcaster, performs a very important service, I would say particularly for rural Canada, where it may be the only broadcaster. You will know that the revenue normally generated by the CBC has been significantly reduced by virtue of the recession. The automobile industry has suffered the same reduction in revenue as a result of the recession.
CBC went to the government and said, "Help us the way you have helped other industries. We need help during the recessionary period." The government has refused any help other than to allow CBC to borrow more money. Their only alternative is to go out and borrow more money, and the result is that they are just putting off the problem to a later day when some government will have to deal with the problem. This particular legislation increases the borrowing authority of the CBC from $25 million to $220 million.
Honourable senators, the next item I wish to bring to your attention is the multilateral debt relief. This is for Third World countries that have borrowed funds and are not in a position to pay the interest on that borrowed money. Several years ago, Canada, along with a number of our countries, began to forgive these debts. This has been continued, and that is also a good initiative.
However, something appears in this particular bill that is quite interesting, honourable senators. The government, in this bill, is asking us for authority to spend $200 million a year on debt reduction, but it is not asking just for this year, not just next year, not just the next five years, but for authority to spend $200 million a year until 2054. We are approving, in this particular bill, expenditure of $200 million a year until 2054. The good news is that there is an upper limit of $2.5 billion. We will all be here to review this, I am sure.
I wanted honourable senators to know that. We were surprised one time when we found in the Main Estimates authority being given to certain departments for expenditures for two years. Put this one beside the two-year authority expenditure.
Next, I will bring to the attention of honourable senators the Nova Scotia offshore payment. Senator Murray brought that point up by way of a question to Senator Gerstein, the sponsor of the bill. I understand from Senator Murray's comment more recently that he now understands what is in the bill.
I want to point out to honourable senators that, in addition to the payment of $174 million to Nova Scotia for two years of compensation by virtue of profits made on the offshore of Nova Scotia, there is a schedule for further payments. Again, we will not be seeing those payments in the future because we are giving authority for regulations to be set up for the payments to be made automatically, so that we will not be reminded in Parliament of what we had approved back in the fall of 2009.
That, honourable senators, is how things are happening. I pointed out to you two measures. One is a payment with respect to the reduction of debt for Third World countries. They are each good policy initiatives but each takes away scrutiny, oversight and the reminder to Parliament of activity not by just the particular government that happens to be in power now but by the civil service which will continue this policy on behalf of future governments.
Honourable senators, the next item I wish to bring to your attention is the Bretton Woods and Related Agreements Act amendments. It is stated here that they are housekeeping measures. This is another one that has just been stuck in here. We look at home builders tax credit and we say that that is much more interesting; let us ignore this Bretton Woods side of things. However, Bretton Woods amendments are quite interesting. The comment by the government is that this is to implement the International Monetary Fund articles of agreement. They say that the International Monetary Fund countries agreed to this in April, 2008. The amendments will come into force internationally once enough countries ratify it. This is a request by Canada to ratify.
This is the part; sit on the edge of your seats for this one, honourable senators, because it says that Parliament saw and had the opportunity to comment on the treaty amendments in March of 2009 when they were tabled in the House of Commons prior to ratification.
Honourable senators, I checked with the Senate to find out if we had an opportunity to see these documents that were filed in the House of Commons. We did not. The only way we would know about them is if we had someone monitoring the table in the House of Commons.
That is another aspect of the regard in which this chamber is held by the government. It is important for honourable senators to understand just what is happening here.
Honourable senators will remember that $2 billion was set aside for quick action. That was in our first Budget Implementation Act, Bill C-10, in April. We wanted to get things going and the Minister of Industry received $1 billion for quick action with respect to universities and institutes of higher learning. If they did not spend the $1 billion before the end of June, the money would go into the normal infrastructure project.
We now have before us, honourable senators, a bill that is asking to change the rules with respect to that money that was spent up to the end of June. Changing the rules after the fact, honourable senators, is what we are being asked to do. I asked myself, if the rules were clear at the time and $1 billion was being spent, what kinds of promises were being made that the rules would be changed later on? Otherwise, why would they be back changing rules now with respect to money that was supposed to be out and spent and working to revive the economy back before the end of June? That is another question that we will have to pursue, honourable senators, when we have the opportunity to have the Minister of Industry before us when we deal with this in committee.
Honourable senators, there are changes to the Bankruptcy and Insolvency Act. Honourable senators will know that there have been many calls for changes to that act. If there can be some changes, why not others? The people who worked for Northern Telecom have been asking for changes to the Bankruptcy and Insolvency Act so that their pensions would be protected. That is not in this bill. However, there are other amendments to the Bankruptcy and Insolvency Act. Someone was focusing on the Bankruptcy and Insolvency Act and said, "This is a change that I think should happen; forget about the other ones." That is unfortunate, honourable senators.
Next, the farmers who raise livestock for breeding purposes and sell their livestock received help with respect to drought. This bill expands that group of society; that is, farmers, who have breeding stock. They can have a drought or a flood now, and, if they have to sell their livestock by virtue of the farm not working well, they will be able to hold on to their money as long as they reinvest it during the year. It is narrow application, but it is important for a certain constituency. I wanted to point out to honourable senators that it is important for a limited of number of individuals.
Honourable senators, next are the changes to the earlier Budget Implementation Act. Some changes had to be made with the earlier legislation and these are technical changes to it.
Next, we have the Canadian Council for Private-Public Partnerships. That company was created about two years ago. I remember giving them quite a bit of money to get started. They are now back to ask that their employees be considered public employees so that they can fit under the program for pensions and that type of thing.
Honourable senators, those are just a few of the items that expand on the points made by Senator Gerstein when he introduced this particular bill. Let me end with the changes to the Financial Administration Act.
The proposed Financial Administration Act amendments are changes that reflect a request made by Senator Segal in his bill that we debated. It went to our committee, passed this chamber and then went to the other house in the last session. That was for quarterly reporting of financial information from various government departments to keep both honourable senators and members in the other place informed about what departments are doing on a quarterly basis rather than the after-the-fact public accounts that we get six, eight, 10 months after the fiscal year. It was a good initiative, and it received a lot of bipartisan support in this chamber. That is being implemented, honourable senators, but, in its wisdom, the government decided to put a restriction on this. The restriction is that they can determine to which departments it applies and therefore, Treasury Board will make the decision. We will ask them, of course, what the parameters are and why they would exclude a particular department or agency from this rule, which should be a general rule. My hope, honourable senators, is that if this is not amended; and if this restriction continues, it will be used very sparingly and we will see quarterly reporting from all the departments when it is implemented in a few years.
Honourable senators can see that we have a number of items to deal with in this particular bill. I presume that it will be going to the Standing Senate Committee on National Finance for consideration. I can assure honourable senators that these points will be the matter of discussion with Department of Finance and others during that period of time.
Hon. Sharon Carstairs: Would the Honourable Senator Day accept a question?
Senator Day: Yes.
Senator Carstairs: Honourable senators, I think all of us are appreciative of debt reduction to underdeveloped countries. That is a laudable goal and one that is easily supported. However, I was quite surprised when the honourable senator indicated that this would go on until 2054 — that is, for 45 years — during which time there would not be any parliamentary scrutiny.
In the Honourable Senator Day's years of experience, both as a member and as the Chair of the National Finance Committee, has he ever seen any other example of the removal of parliamentary scrutiny for a period of 45 years?
An Hon. Senator: Unbelievable. It is a dictatorship.
Senator Day: I thank the honourable senator for her question. I highlighted this point for that very reason. That is, it seems to be absolutely incredible that it would go to 2054. The honourable senator does, indeed, have the year correct. It is found in this bill at clause 18, Part 2, under Miscellaneous Payments. I have the section in front of me. It says:
18.(1) . . . the aggregate $200 million in each fiscal year. . . . No more than a total of $2.5 billion may be paid out under this subsection.
Those are the two upper limits, if that gives the honourable senator any comfort.
Senator Carstairs: I remember a number of discussions while the honourable senator was a member of this chamber about the grave concern of those on the other side with respect to foundations of any kind being established by the government. Their principal objection was the lack of scrutiny of the politicians in both the House of Commons and the Senate of any kind of analysis of these foundations despite the fact that these foundations were issuing yearly reports.
Does this particular piece of legislation envisage that each year there will be an annual report to tell parliamentarians exactly what debt reduction has been eliminated and for what countries?
Senator Day: If there is an annual report, I hope that it will not be like the International Monetary Fund report that is filed in the other place and never comes to our attention.
As I read this section, honourable senators, the money that will be paid out by the Minister of Finance will be paid to a third party organization that will decide how to reduce the debts to various countries that are within the list of countries that are deserving of debt reduction. Whether or not there will be a report from that third party that will be passed on to us is a question that we will have to pursue at committee.
Hon. Jerahmiel S. Grafstein: I am delighted that the honourable senator brought to our attention the amendments to the Bretton Woods and Related Agreements Act, sections 21 and 22.
On reading those sections, which the honourable senator brought to my attention some time ago, it is fair to say — and perhaps he will agree — that they are the most massive reforms to our relationship with the International Monetary Fund since the Second World War. It opens the door, if I read these amendments correctly, for that International Monetary Fund to make investments of any sort, without any restriction, which is a massive change. It affects the question of gold, and it goes indirectly to the question of the dollar.
Could the honourable senator tell me how much time was spent in the other place on debating this issue, which is the most intrusive and profound reform, I believe, to the International Monetary Fund since the Second World War?
Senator Day: I thank the honourable senator for his question. In reviewing the various transcripts of the debate, I have read nothing in debate on this particular matter. This is the area where we had a chance to comment, according to the government, because they filed a document explaining this in the other place in April. We never saw it.
We will be asking questions on this in committee, and hopefully I will have some answers when we get to third reading on this particular matter.
Senator Grafstein: I have a short supplementary question. We have seen profound amendments to the Bank of Canada Act whisked through the Senate and through the house, the likes of which we have not seen since the Bank of Canada Act was organized. Again, we had tabled in this place, as the honourable senator will recall, 47 reforms that the ministers of finance had agreed to, and we have had no accountability, certainly not to the Senate, for any of those reforms.
Does the committee intend to look at that question, as well, to see what impact it may have on the economy, and the fiscal and monetary powers of the Bank of Canada?
Senator Day: I do not like to speak for the steering committee, but I can tell the honourable senator that regarding the issue with respect to the Bank of Canada, we missed a clause in one of these bills in the past that allowed the government and, therefore, the Bank of Canada, to borrow without coming back to Parliament, and I confess to missing that.
In the past, all borrowing by the government was scrutinized by Parliament. Then there was a clause that said they could borrow without the necessity of parliamentary approval. As my honourable colleague Senator Banks has pointed out, now this approval to be able to spend until 2054 means they can borrow without approval or scrutiny, and they can spend without scrutiny, so why do we not just go home?
Hon. Roméo Antonius Dallaire: Honourable senators, I have a related question. This brings to mind some of the important bills that are often studied very quickly. Do honourable senators not agree that certain elements of this appear to run counter to former Bill C-2, that addressed the accountability and transparency the government has been advocating for the past few years?
The government wanted to impose a system of governance in both houses.
Senator Day: Honourable senators, I cannot say that any particular section goes directly against a section of Bill C-2. However, I can say that generally speaking, it is clear that it goes against the spirit of Bill C-2 regarding accountability. When we have a bill like this before us, one with so many issues to discuss, and we have only a short time to study it, it is very difficult for us to properly understand it.
After studying such bills, will we be able to say whether we want to vote in favour of the bill?
Senator Dallaire: Does that mean that the government, once in power, lost all notions of transparency and accountability, and therefore believes itself to be above the rules that it wants to impose?
Senator Day: Thank you. Your comments are well taken.
Hon. Tommy Banks: Honourable senators, I apologize that I will rant and ramble a little here. I want to say to the new members among us who have not heard me on this before that I am a rank amateur when it comes to these questions by comparison with other members here, particularly Senator Day. I thank Senator Day for his exquisite explanation of what is going on here and what we are doing. He has been preceded by others who have pointed the same things out to us, most notably Senator Murray, from whom I learned what little I know about these things when I first had the honour of joining that committee when he was chair. He was saying then many of the same things that Senator Day has just spoken about and that Senator Dallaire has just referred to.
The aspect that concerns me about this is the following: the continuum of forms of governance in the world. If you are over here, a totalitarian dictatorship is an efficient form of government. It does not require a whole lot of talking; very few people or someone decides what will happen, and that is it. Over here, at the other end, is the most inefficient form of government on the face of the earth — parliamentary democracy. It is inefficient. The reason that it is inefficient is that it stems from a time at Runnymede when some people went to the king and said: "You can no longer just tell us how much tax you will collect, and you can no longer just tell us how you will spend it. You have to ask us. You have to talk to us and you have to obtain our consent." Parlez à moi! Speak to us! Parliament — that is what this is all about.
Constitutional parliamentary democracy has to do only, in its beginnings and in its fundamentals, with purse strings: How will you collect taxes and how will you spend the money that you get?
Members opposite do not know this, but I want to assure you that Senator Murray, his successors and I, in my amateurish way, have been railing about this to this government, to the government before that and, in my case, to the government before that and, in other cases, to governments before that. It is very efficient for governments — Liberal governments, Progressive Conservative governments and Conservative governments — to find ways to get around having to have detailed parliamentary authority. When we in Parliament give the authority to the government to do things, they are always acting properly, because we have given them the authority to do that.
Senator Day referred to that. Last January 29, we passed a budget bill, and we did not catch it, but ever since Confederation, governments, whatever colour they were, have had to come to Parliament and say: Here is how much money we want to borrow, and here is why. I cannot remember whether it was annually or during sessions or during the life of a parliament, but parliaments always had to be asked that and always, by convention, had to give that authority to the government to borrow money, and to spend it as well in implementation bills.
Last January 29, no one in the other place caught it, and no one here caught it until after we had done it. We gave this government and the one after that and the one after that, unless we change it as has been proposed in the bill that Senator Murray presently has before us, the authority to go out and borrow however much money they want, without explaining anything to anyone, without saying why or for what purpose or from whom or at what rate it is being borrowed.
I will give you two more small examples of the fact that Parliament is being asked, bit by bit, to give up its authority to successive governments. Liberal governments did this too, and Progressive Conservative governments before that. Parliament is losing its authority. We have to remember, honourable senators — I hope we will somehow come to remember some day — that the government is a function of Parliament, not the other way around. The government does not wield Parliament. The government, the Crown, is accountable to Parliament. That is what we are here for. If we do not do that, and if we do not insist upon doing it, and if we do not regain some of the ground that has been lost over the decades, we might as well, as Senator Day said, all go home, because we will have given away all of our parliamentary authority.
We are being asked in this bill — it is astonishing — to approve expenditures for 45 years into the future. I suppose that that is binding on successive governments and parliaments. I do not know. It is an interesting legal question. We are being asked after the fact to say, "You know this program we have been advertising about home improvement grants? We would like you to approve it now." What? How could any enterprise embark upon an undertaking that is a fait accompli and then come back later to someone and say, "By the way, we need some money for this." It is astonishing.
The Bretton Woods amendments are further measures in which we are being asked to give away. We are being asked to divest ourselves of authority. The most efficient thing will be that nine or ten people will run the country, and it is not that far off if this continues as it has continued for a long time before I or any of us got here.
I hope, honourable senators, that we will take the time in committee to examine this question. I urge the committee chair to ask for extra time. If we do not examine these questions, we will do once again, in this implementation bill, what we did last January 29. We will give away another part of the store. We will give away parliamentary authority, as we have done in the past. It does not make any difference what colour or political stripe we are. The red guys did it, and the blue guys did it. We have to stop it, because if we want to have parliamentary democracy, we must make it function. We are losing the capacity to make it function.
Hon. Pierrette Ringuette: Honourable senators, I have been a member of the Standing Senate Committee on National Finance for quite a number of years now. The point that my honourable colleague Senator Day has raised is interesting, and I want to do more research on this before I continue debate. Therefore, I move the adjournment of the debate.