By Probe International

Statement by Ms. Adams on Bill C-31 to the Standing Senate Committee on Banking, Trade and Commerce

(November 21, 2001) Bill C-31 will allow EDC to write the rules, establish the criteria, define the terms, assess itself, and then decide whether or not it is justified in supporting a project that will destroy the environment.

This speech was presented by Patricia Adams, Executive Director of Probe International, to The Standing Senate Committee on Banking, Trade and Commerce, The Senate, Ottawa, Canada on November 21, 2001

Thank you Mr. Chairman for the opportunity to appear before this committee on Bill C-31.

In my written submission to you, I have explained in detail our grave concerns about Bill C-31 to amend the law governing the Export Development Corporation. I will briefly recap those concerns now and I would be pleased to discuss them in more detail during questions.

Probe International, the organization I represent, has investigated the environmental, financial, and social consequences of EDC’s activities for the past 20 years. We have 20,000 supporters from across the country who are concerned about EDC’s long history of financing reprehensible projects, including nuclear technology to military hotspots in Pakistan and India, mines that dump cyanide into rivers, and hydro dams that destroy fertile valleys in poor countries and force millions of people off their lands.

Bill C-31 will not stop EDC from financing these dreadful, damaging projects in future. This is why.

Bill C-31 establishes in law an environmental review procedure in which EDC is entirely in charge of the environmental and legal goalposts. It will be subject to no standards, except those it chooses. And it can choose different ones on different days. It can even choose to exempt itself entirely from conducting an environmental review of a project. Bill C-31 will allow EDC to write the rules, establish the criteria, define the terms, assess itself, and then decide whether or not it is justified in supporting a project that will destroy the environment. The effect of this, as the Parliament’s own Legislative Summary sees it, is to give EDC’s Board “complete, unlimited freedom to make any decision,” that “would be virtually immune from judicial review.”

This process of applying infinitely adjustable standards is known as “benchmarking,” and it has been roundly condemned by environmental groups from other OECD countries as nothing more than a public relations exercise that misleads taxpayers and legislators into believing the environment will be protected when in fact it will be “business as usual.”

The second major flaw with Bill C-31 is that it fails to subject EDC to the Access to Information Act. During the review of the Export Development Act that has culminated with Bill C-31, the government heard from more than 140,000 Canadians who demanded that EDC be subject to the Access to Information Act. It is a good law, not always evenly applied, often under threat from the government of the day, but it is one of the most important democratic tools the citizenry in this country has to define and obtain what it wants to know about government activities, rather than the other way around. Without it, public oversight of EDC’s activities is handicapped and enables this Crown corporation, operating “on her Majesty’s credit card,” to escape effective accountability.

To placate public demands that EDC be subject to the Access to Information Act, EDC has offered up a wholly inadequate substitute — it’s new Directive on Disclosure. Just as Bill C-31 creates a toothless exercise in environmental review that is designed for public relations, EDC’s new disclosure directive is similarly designed to convince the public that EDC will be more transparent while it largely maintains the status quo. If you read EDC’s new Directive on Disclosure carefully you will see that EDC and its corporate beneficiaries will continue to determine what the public sees, not the other way around. If the public is dissatisfied with EDC’s disclosure practices, it will have no recourse to judicial review.

The failure to subject EDC to the Access to Information Act will allow EDC to continue to hide its mistakes. It will also provoke distrust among the Canadian public, our trading partners, and bodies that govern international trading regimes, such as the OECD and the WTO.

These two major flaws in Bill C-31 severely limit public oversight of EDC, creating an environment for corruption, cronyism, and a recklessness that leads to unacceptable environmental, financial, and social costs.

But section 24.2 of Bill C-31 threatens public oversight even more. This section could silence public debate about EDC altogether. As written, section 24.2 could prohibit any public mention of the Export Development Corporation’s name, in writing or in speech, in any circumstance that could be characterized as a “business purpose” or an “advertisement,” unless written permission has been obtained from EDC. The penalty for doing so would be a fine of up to $10,000, six months imprisonment, or both. The potential for this egregious infringement of free speech is real. In August of this year, before Bill C-31 was introduced, EDC warned Probe International to stop identifying this Crown corporation on our web site by its name and its logo “to avoid the costs associated with litigation.”

This draconian provision reflects EDC’s disturbing intolerance for critical public debate of its operations. EDC has told us that it will answer questions from NGOs it considers “credible,” and will put questions from NGOs considered not credible on the back burner. In another example, EDC invited public comment on its draft disclosure policy last summer, and stated that it would post submissions on its web site. Yet it refused to post Probe International’s critical review, saying it contained “inaccuracies or unsubstantiated statements.” When I pressed EDC to substantiate its accusations, it could not.

EDC seems to thinks it can act as the “thought police.” Bill C-31 would give it that power. As written, we could not communicate with the public or even with our supporters without threat of fine and imprisonment. Our Parliament must remind EDC that it is an agent of the Crown, that it has created some $19 billion in liabilities for taxpayers, and that it can not silence its critics.

We urge the Standing Senate Committee on Banking, Trade and Commerce, at a minimum, to strike section 24.2 from Bill C-31. We also urge this Committee to amend Bill C-31 to ensure that, as long as EDC exists, it is subject to effective and thorough public oversight.

Thank you.

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