EDC

Senate debate continues

(December 5, 2001) Hon. Senators Tkachuk and Angus join in the third-reading debate on Bill C-31. Senator Angus points out several flaws, especially the lack of transparency and accountability which the proposed law accords to the Export Development Corporation.

1st Session, 37th Parliament,
Volume 139, Issue 77
Export Development Act
Bill to Amend-Third Reading-Debate Continued

On the Order:

Resuming debate on the motion of the Honourable Senator Robichaud, P.C., seconded by the Honourable Senator Ferretti Barth, for the third reading of Bill C-31, to amend the Export Development Act and to make consequential amendments to other Acts.

Hon. David Tkachuk: Honourable senators, my short speech today follows somewhat on the question Senator Sparrow directed earlier this day to the Leader of the Government about who is minding the store. As you know, I have talked on a number of occasions about the accountability of Parliament, and frankly, honourable senators, Parliament is supposed to be minding the store.

Both Senator Sparrow and I have a healthy distrust of the bureaucracy, not because the bureaucracy has bad people in it, but because bureaucracy is a large institution and we delegate powers to the bureaucracy. However, in delegating powers we should not delegate responsibility or accountability.

When was the last time a minister resigned because he misinformed Parliament? It does not happen any more. It does not happen because people no longer feel accountable. It is a little thing. People say, “It does not really matter, I changed my mind.” We here in the Senate have an even more onerous responsibility. We are placed here with certain privileges. We do not have to seek the will of the people every four years like the members of the other place. As senators we have a responsibility to not only be the house of sober second thought, as many say, but an obligation to step in when we see failings in the works of the other place. If we are not fulfilling that obligation, I have no idea why we are here. Are we simply a mirror image of the other place, which is frankly what we have become. Perhaps if I were on your side I would feel differently, but I am not. I know that if there was a mirror there and we were looking at it, we would not see anything different from the other place.

Honourable senators, we are a privileged group. We receive our paycheques. We sit fewer days. We do not have to seek the will of the people. There is a reason for that: We can act with some independence when we see failings. To be the house of last resort, to uphold the Constitution and to uphold the reason for Parliament is accountability itself. If Parliament is not accountable then there is no accountability.

Yesterday an amendment was moved on Bill C-31, which was defeated. My remarks will focus on the process because Senator Oliver spoke on some of the problems we had with the bill, and Senator Angus, who will be speaking after me, will focus on other specific concerns. It was a small amendment that would have changed a couple of words so that the Crown corporation in question would be more responsible to Parliament and fall under the provisions of the Statutory Instruments Act. It was not a big deal. It was not a motion of non-confidence.

I do not know whether Senator Sparrow voted for that amendment, but that is a little thing we can do to fix the problem of who is minding the store. We could force Crown agencies to be responsible to Parliament, because if they are not responsible to Parliament they are only responsible to one man, and that is the minister who holds their portfolio. They do not have meetings. Can you imagine all that cash, all those employees and no one responsible? There is no annual shareholders’ meeting when thousands of people get together and say, “Hey, what are you doing out there?” It is just them and us.

The bill was referred to the Banking Committee Tuesday evening two weeks ago, which began its study on Wednesday. On Thursday, we completed the clause-by-clause study. The committee reported on Tuesday of last week with observations as an appendix to the committee report. They were minority observations because our colleagues on the other side refused to consider even two little amendments, which were both issues of accountability and not issues of principle or issues of great substance. That is all it was.

When the Banking Committee reviewed the EDC Act in March 2000, we expected legislation to be tabled once the overall review was complete. Bill C-31 is the first legislation to be tabled regarding the EDC since that review. We were expecting a name change and some minor changes regarding the pension plan. We were also expecting from the government a provision that would guarantee a level playing field while not compromising EDC’s ability to serve exporters, sometime within six months of the issuance of the Senate Banking Committee’s report, which was dated March 2000. That did not occur, nor did provisions for this new policy appear in Bill C-31.

While we continued to support the excellent work and initiatives of the EDC, we did have any outstanding concerns arising from this bill. My concerns, as I said earlier, deal with accountability. We have continued to witness an erosion of direct accountability by Parliament through the use of more detail in regulations. We have all heard the statement, “Oh, we will deal with that in regulations.” Such detail does not even appear in legislation so we do not know what will happen. Then we are told, “Well, it will come up for review.” Yes, it does, in the summertime. There are hundreds of them and it is very difficult to watch them all: changes to reporting techniques; relying on the Auditor General rather than the public accounts committee, which we used to rely on; reviews that are taking place further and further apart; and finally, less direct response to committees by the minister responsible.

Honourable senators, we should not deal with any bill unless the minister appears before the committee. If it were my government, I would say, “If you want this bill come before us and argue for the bill.” We should not need to beg or ask. It should be a done deal or the bill does not move off the Order Paper. They are the ones who want the bill. They initiate the bill. Then they send their bureaucrats to argue for the bill in front of parliamentarians. That is ridiculous. We demean this place when we allow that to happen.

When the Standing Senate Committee on Banking, Trade and Commerce undertook its review of the EDC Act, our recommendations and report struck a balance between the Canadian government’s commitment and obligation to the environment, which is the other issue that came up here, and the commercial objectives of this agent of the Crown, the Export Development Corporation. We decided and agreed it would be acceptable for EDC to establish its own environmental review framework.

Honourable senators, I had much difficulty with that. I believe the committee agreed to the process because we were assured there would be accountability built into this framework. In Bill C-31, which amends the EDC Act, an environmental review framework is established as anticipated. However, there must be further accountability to Canadians through Parliament, which can be achieved easily with an amendment ensuring that the Export Development Act is subject to the Statutory Instruments Act.

Senator Oliver moved that very amendment and it was defeated last night. Senator Nolin spoke eloquently a week ago Wednesday on Bill C-7, about the role of the Senate when it comes to legislation. If I have one strong message today, it is that we must ensure that Canadians, through Parliament, and especially through this chamber, have an accountability structure in which they can believe.

(1520)

We should have a framework by which to judge bills. One requirement should be that the minister appear. We should also be able to tell how others are accountable to Parliament for the measures in the bill. How do we, as parliamentarians, impose our will upon what is happening to us? If there is no way to impose our will down the road, then this bill drifts off into never-never land; the actors are never made accountable to Parliament. The only way we can get the actors to be accountable to Parliament is through the public purse. However, we have left that oversight to others; we have not taken it upon ourselves. It rests with us, and we must be vigilant in our duty. I hope honourable senators will consider very carefully our duty and our role as senators in this place when we vote on third reading of this bill.

Hon. W. David Angus: Honourable senators, I, too, would like to join in the third-reading debate on Bill C-31.

I simply state at the outset that I do support Bill C-31, for the most part. I approve of and support the very good work done by the Export Development Corporation and its officials as they endeavour to achieve the aims and objectives set forth in their mandate.

However, there are several aspects of this bill that concern me deeply and which I think should concern us all. Senators Oliver and Tkachuk have already pointed out several flaws in Bill C-31, dealing especially with the lack of transparency and accountability which this proposed law accords to Canada’s Export Development Corporation.

Senator Oliver’s proposed amendments were defeated here last night without debate. The five Progressive Conservative senators on the Banking Committee prepared and submitted a minority report, honourable senators, which was appended to the committee’s report filed here on November 27. That minority report was prepared only after the amendments put forward by those same five Progressive Conservative members on the committee were dismissed out of hand without consideration, without any debate whatsoever. The amendments were rejected along party lines by the seven Liberal senators on the committee.

Honourable senators, before going into the details of my particular submission on one aspect of the bill, I refer you all to an editorial by Andrew Coyne entitled, “The death of Parliament,” which appeared on November 28 in the National Post. He makes the point that Parliament – and that includes us, honourable senators – has abdicated its duty to be accountable, to debate and study legislation, to propose amendments and, when appropriate, to adopt them. Closure and party-line voting, without study or debate, were highlighted in this article and characterized as extremely objectionable. I quote one piece from that editorial:

If ever there were a time in which the legislature ought to play a leading role in the making of law – to air concerns, suggest improvements, and shape a consensus – it is now. And if ever there were any doubt that Parliament has ceased to play that role, there is no more. As a watchdog on the executive, as a guardian of the public purse, as a house of deliberation, it is, as the constitutional scholars say, a dead letter.

Honourable senators, we should pause to reflect on those points. We may not agree wholly with them but, as my colleague the Honourable Senator Tkachuk has just stated, it is a matter for serious concern at this particular time as we approach the Christmas break.

I refer honourable senators particularly to the section of the minority report dealing with clause 12. That is the clause that particularly concerns me. Clause 12 proposes to add a new section, 24.2, to the Export Development Act which would read as follows:

24.2 (1) Except with the written consent of the Corporation, no person shall in any prospectus or advertisement, or for any other business purpose, use the following names and initials: “Export Development Canada”, “Exportation et développement Canada”, “Export Development Corporation”, “Société pour l’expansion des exportations”, “E.D.C.”, “EDC”, “S.E.E.” and “SEE”.

(2) A person who contravenes subsection (1) is guilty of an offence and liable on summary conviction to a fine not exceeding $10,000 or to imprisonment for a term not exceeding six months, or to both.

In the face of this kind of proposed legislation, what is the rush? Why is the government wanting to push this bill through when we could be addressing such things in two small amendments? Honourable senators, I am sure, can see our concerns, and those of the witnesses who appeared before the committee.

[Translation]

According to government and EDC witnesses, the government’s interest in clause 12 of the bill is to prevent all fraudulent acts. However, this clause is too broad and has the effect of criminalizing the use of the EDC’s name or acronym without the explicit authorization of the EDC.

[English]

The problem appears not to be with the intent, honourable senators, but with the very wording of the proposed legislation. Simply put, the bill is very badly drafted and could easily lead to unwanted, unfortunate and difficult results, if not amended.

[Translation]

Under clause 24(2) of the bill, an organization with the same name or initials could be subject to criminal charges. I cannot overemphasize my concerns regarding the terrible consequences this clause could have on many Canadian organizations and companies.

[English]

Just taking a look through the phone book, for example, we found listings such as EDC Facilities Management & Consulting of Windsor, Ontario, Electronics Delivery Consulting of Toronto, and the EDC Telecommunications Group of Toronto. Does it make any sense to put firms like this at risk of heavy fines, and even possibly jail terms for their officers, for just using their own names and initials?

Adequate legal safeguards already exist to protect company names and trademarks under a variety of intellectual property laws and regulations already on the books. This proposed section 24.2 covers matters that are covered under well-established Canadian laws including trademark law, competition law and copyright laws.

Honourable senators, as drafted, Bill C-31 would make it a criminal offence to use the name EDC in an advertisement criticizing its record on the environment, unless you first get their written permission.

I am concerned with the fact that EDC requires this added protection. Why is that? As a lawyer, to me, this added security measure makes me wonder what is up. What have they got to hide? Why would the EDC require this special clause? I asked at the committee if they really needed it and they said no. I then asked if we should take it out and they said, “Leave it in,” and they had seven willing horses to support them.

Why would EDC desperately need measures to guarantee that no organization could comment on EDC or even mention its name without its written consent or otherwise face a criminal violation? Is this not a violation of our freedom of speech? Testimony by witnesses has drawn the attention of committee members to the fact that the EDC has already written a letter directing a particular organization in Canada to stop using their initials on a Web site that is actively critical of the EDC’s environmental record. Here is a huge government organization in a great big building here in Ottawa with thousands of employees, big enough to defend itself, but now it wants to write a measure into the law guaranteeing that no organization can even mention its name.

[Translation]

Honourable senators, we believe that interest groups and the media have the right to criticize and comment on Crown corporations that are funded by public monies if they want to.

[English]

(1530)

Honourable senators, it is interesting to note that Bill C-41, which is currently before Parliament, does not include such a clause limiting the use of the initials CCC for the Canadian Commercial Corporation. The only other example that the government can list of a Crown corporation with such a clause is the Business Development Bank, the favourite bank of the Prime Minister. I would suggest that this really ought to be changed as well.

We have also been told of similar sections in the Bank Act and in the Insurance Companies Act. The sections may have a similar intent, but they are not drafted in such a draconian manner.

At committee a week ago Thursday, the government was quick to circulate the relevant sections of the Bank Act and the Insurance Companies Act as proof that this measure is not out of line. However, those acts prevent the use of a bank or an insurance company’s name in a prospectus, offering, memorandum, advertisement for a securities transaction, and so on, except as permitted by the applicable regulations. Leaving aside the issue that the ban is on securities advertisements and not advocacy advertising or comparative advertising, the government side did not circulate the full story: We need to refer to the regulations which show us what is, in fact, permitted.

Let me say this: The Bank Act’s “name use” regulations read as follows:

A person may use the name of a bank in a prospectus, offering, memorandum, takeover bid circular, advertisement, or a transaction related to securities, or in any other document in connection with a transaction related to securities where the use is required by law, or the bank has given its express written permission for the use.

Note, honourable senators, the one key difference: The Bank Act regulations do not require you to get the permission of a bank if you are required by law to mention the bank’s name in a securities prospectus. Regulations under the Insurance Companies Act are almost identical.

I will not belabour the issue, honourable senators. The point is that Bill C-31 does not grant that type of an exemption. The last time I looked, the provinces had jurisdiction over securities measures. If you issue a prospectus, you must declare all material facts. Thus, if you owe money to the EDC, Bill C-31 puts you in the unusual, bizarre position where you must seek the permission of a federal Crown corporation to meet your legal obligations under a provincial statute.

[Translation]

What is going on, honourable senators?

[English]

The EDC has managed fine so far without such a clause. This clause should be struck from the bill, as there is no demonstrated need for it. We moved an amendment in the committee; I have told honourable senators what happened. Senator Oliver moved an amendment last Thursday. We saw what happened as a result of the vote last evening. All I can do is add to my colleague Senator Tkachuk’s words and say, please, honourable senators, when you finally deal with this bill, give careful consideration to the points we have made.

On motion of Senator Setlakwe, debate adjourned.

[Translation]

Full transcripts are available on the Canadian government’s Web site at:
http://www.parl.gc.ca/common/Chamber_Senate_Debates.asp?Language=E&Parl=37&Ses=1

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