June 5, 1992

PC

Steve Eugene Paproski (Deputy Chair of Committees of the Whole)

Progressive Conservative

The Acting Speaker (Mr. Paproski):

I have a very short supplementary here from the hon. member for Broadview- Greenwood.

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Subtopic:   ALLOTTED DAY, S. O. 81-ONTARIO ECONOMY
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LIB

Dennis Joseph Mills

Liberal

Mr. Mills:

Mr. Speaker, it will be a short supplementary. The New Democratic Party member made this reference that Liberals were not sensitive to small business. I just want to remind him and this House and the people of Canada that under Prime Minister Pierre Elliot Trudeau, there were more small business start-ups in this country than in all the years of government put together. We should never forget the fact that it was under the Liberal Prime Minister that the Small Business Loans Act came into play. The expansion of the Federal Business Development Bank, not to mention numerous other incentives, used the power of entrepreneurship to put people back into the work force.

I remember when the member for Winnipeg South Centre was the minister of employment, he came out with that very successful NEED program. It put close to

330,000 Canadians back to work in a 90-day period during the last recession. We used small business. The NDP should just read the facts.

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NDP

James Capsey (Jim) Karpoff

New Democratic Party

Mr. KarpofT:

Mr. Speaker, just before I answer that question, the Liberals and Tories seem to be enjoying this questions and comments period. I would ask for unanimous consent of the House to extend this period for another ten minutes so that I can continue.

It is probably true that under Mr. Trudeau there were probably more small businesses created than at any other time. They were probably all advertising firms or consulting firms that worked for the Liberal party.

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PC

Steve Eugene Paproski (Deputy Chair of Committees of the Whole)

Progressive Conservative

The Acting Speaker (Mr. Paproski):

Is there unanimous consent?

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?

Some hon. members:

No.

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PC

Kenneth David Atkinson

Progressive Conservative

Mr. Ken Atkinson (St. Catharines):

Mr. Speaker, I

appreciate the opportunity to speak today on the subject

June 5, 1992

of the difficulties faced by the residents of Ontario. After that last exchange it is somewhat difficult to even respond.

If I may just digress for a moment, I might say that the labour legislation proposed by the NDP government of Ontario is causing some concern. As was mentioned by the member for Broadview-Greenwood, it certainly is in the area of investment in the province of Ontario.

There is one particular company in St. Catharines which is a multinational corporation which has kept it quiet, but made it clear, that there is no further investment to be made in their particular organization in Ontario at the present time. In fact, after reviewing the legislation, that may continue as well. That is the type of thing that is occurring in the province of Ontario now.

In addition, the member spoke about the tax system. It is very interesting that promises were made such that the tax system would be reformed. They had a commission on fair taxation. They were going to have a minimum tax on corporations. Lo and behold, when they looked at it they found out that maybe corporations were not going to have a minimum tax. Maybe they were paying their just due and perhaps putting an extra burden on them would affect their competitiveness.

It is surprising how the strictures of government seem to change the viewpoints and promises that are made during an election campaign. I am sure people will keep that in mind as they review these various matters.

Obviously, it has been a difficult time over the last few years. There have been difficult social and economic circumstances and, of course, this is extended to the province of Ontario as well. As my riding is in the province of Ontario, we have had some difficulties also. However, to say that it results from the negligence of the government and to lay it entirely at the feet of the government is not being completely above board.

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NDP

James Capsey (Jim) Karpoff

New Democratic Party

Mr. Karpoff:

I am sure it is.

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LIB

Peter Andrew Stewart Milliken (Liberal Party Deputy House Leader)

Liberal

Mr. Milliken:

Which government?

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PC

Kenneth David Atkinson

Progressive Conservative

Mr. Atkinson:

Let us look at some specific circumstances. My community has been hurt by the recession and by what has gone on.

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The announcement a few months ago that 2,300 jobs were going to be lost because of the closing of a General Motors foundry in St. Catharines was obviously devastating to the community. The immediate knee-jerk reaction was to blame the free trade agreement. That is interesting.

The auto pact has been in effect since 1962. It has done wonders for the North American automobile industry and the automobile industry in Canada has benefited greatly. It integrated the entire North American automobile market with certain safeguards, as they are called. One of those safeguards is that we will continue to produce as many cars as we consume here in Canada. The interesting fact is that we produce almost double the amount of cars we consume in Canada at the present time. We have benefited greatly from the auto pact.

The other safeguard is that the big three automakers are able to import parts from offshore duty free if they maintain a 60 per cent Canadian content level on the cars produced here above that which existed in 1962. They have always done that and they have continued to do that.

Mr. Speaker, I know you realize that you do not mix that with the 50 per cent content rule that exists in the free trade agreement. That does not apply to the big three although the big three have always maintained much more than that 50 per cent North American content.

On the day the announcement was made about those lost jobs in St. Catharines it is interesting that approximately 15,000 jobs were lost in the United States on the same day. The simple fact is that there is an overcapacity in the automobile market. This overcapacity has come about as a result of the imports. They are making greater and greater inroads into the North American market over what the North American automobile manufacturers are producing.

Unfortunately, a lot of that was the result of people thinking the quality of North American cars was not as good as the imports for quite a period of time. The big three have made certainly a great effort in order to improve their quality and the quality has improved. They are trying to win back their market but they have not been able to win back that market share. General Motors was set up throughout North America for a certain market share. That market share has been lost. Whether

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it will be regained or not is something we will have to wait and see.

Pessimists would say they are not going to regain that market and as a result the industry has to rationalize down to the capacity they need in order to meet the market demands. They have done that and as a result St. Catharines is going to be affected by that.

It would nice if people would purchase North American cars and get back to the capacity that previously existed. Then there would not be any pressure on them to close the foundry in St. Catharines. The foundry in St. Catharines cannot be expanded and as a result there are larger foundries n the United States that can take on the capacity that is necessary to meet the demands of the marketplace. The foundry in St. Catharines was modem and efficient, yet because of its mere size, this is causing the difficulties.

I also might mention that the foundry represents a portion of the entire factory in St. Catharines. It is not the closing of the entire factory. There are still approximately 6,000 jobs there, but of course they have to justify their existence just as the company in Oshawa has to justify remaining intact within the General Motors system.

The auto pact has worked well for us. It is intact. To say in a knee-jerk way that the loss of those jobs is a result of the free trade agreement is not being intellectually honest and cannot be allowed to continue in that manner.

Obviously we would like to save those jobs and see other jobs created. That is going to take an effort on the part of all of us in working together. To lump those 2,300 jobs together and say that that is a result of the free trade agreement is just not correct. These are the kinds of figures that the opponents to the free trade agreement come up with.

In the North American free trade negotiations-and this is where we may have an internal debate within Ontario-it would be nice to see the North American content be increased for the cars that are able to be exported duty free to the United States. I certainly would like to see a figure of 60 or 65 per cent come out of the North American free trade agreement. That will be beneficial to a community such as St. Catharines. There

will be an internal debate within Ontario with the import manufacturers as to whether that is going to be beneficial in their particular case. Something such as that would certainly help the North American automobile industry and I will be watching very closely for that.

That was one example of what has happened. The knee-jerk reactions of some people indicates that happened as a result of the free trade agreement when it is not a function of the free trade agreement. The auto pact is intact. There is an over-capacity in the North American market. To say that those jobs were lost, to lump them in with all the other jobs that were lost, and say it is because of the free trade agreement is not correct. In a lot of instances that is what is occurring in other areas as well.

There have been losses as a result of the free trade agreement, as the Minister of State indicated. There were losses as a result of the implementation of the auto pact as well.

It was interesting that a union leader came before the St. Catharines city council when I was there and said: "You cannot allow the free trade agreement to go ahead". We debated and asked: "What was your initial reaction to the auto pact?" He said: "We were opposed to it. We did not like it. We thought it was going to be bad for us". We asked: "What is your reaction now?" His answer was: "Under no circumstances can you allow the auto pact to be affected by the free trade agreement". It was not. I asked: "What happened to you when the auto pact came into effect?" His answer was: "I was driving cab for a while". He was driving cab for a while because the plant in St. Catharines, which had made all the components for cars produced in Canada at that particular time, switched over to simply producing engines. It had longer production runs and better quality. After that initial restructuring it resulted in more jobs being created.

More cars are produced in Canada than we consume. We have been a net beneficiary of the auto pact. Similar benefits will flow from the free trade agreement but there is going to be a period of restructuring. A recession and an over-capacity in the automobile market in North America cannot be used as excuses to say that the free trade agreement is not working. To say that is to be intellectually dishonest.

June 5, 1992

I am glad to see that the Liberals have changed their position. Now they are saying that the free trade agreement should be renegotiated. It will be interesting to see what points they say they are going to renegotiate. However, accepting the free trade agreement and accepting the globalization that has occurred it is gratifying to see they have realized that is going to be their position. That was the position enunciated by their government House leader in this House during previous debates.

Free trade has benefited the Niagara peninsula. One industry that has really benefited is the grape and wine industry. During the negotiation of the free trade agreement it was widely assumed that the grape and wine industry would be a big loser as a result of the free trade agreement. There was no protection for the grape and wine industry and it had to rationalize very quickly.

It is interesting that it has produced high quality products and this year it has seen its market share jump drastically. It used to be that all surplus grape products were purchased by the federal government. Unfortunately, the grape and wine industry went through a period where it produced what might be called "pop wines" and so on, and again it developed a reputation in terms of the quality of its products that was not the best.

As a result of the free trade agreement and the Ontario legislation preventing Lambrusca grapes from being put into the wines it has now developed quality wines that are winning awards around the world. Entrepreneurs have realized that and moved in and used the grapes produced in the Niagara peninsula to secure these awards around the world.

An example is Don Ziraldo at Inniskillin Wines. His ice wines have won many awards.

This year there was not any surplus, the industry sold its entire grape product. Ontario wines are being sold in the United States and they are being sold in England. Unfortunately interprovincial trade barriers in this country prevent Ontario wine from being sold to Quebec and other provinces. It is easier for Ontario wine to get into the United States and even England than it is to get into the provinces of this country.

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The result of the free trade agreement is that the industry has become more competitive, has produced better wines, and has succeeded. The fact that it cannot even sell in various provinces makes no sense. In that regard I certainly hope the constitutional negotiations succeed and we do create a true common market among Canadian provinces.

We spoke about training earlier today, and I think we all agree that training is most important. We will see what occurs from that particular aspect. The constitutional proposals indicate that the provinces will take over all training. That is something that causes me some concern because the federal government has done a commendable job in the training area.

It was interesting that in the testimony before the Beaudoin-Dobbie committee when the individuals who head the training assistance boards came before the committee they indicated that there certainly was enough money in all the provinces and the federal government for training. It was a matter of directing it. The provincial government itself has its skills training within 10 different departments. It is in the process of bringing those under one umbrella. However, the turf wars that will go on are going to hurt the individuals who need training. That is something we have to deal with.

The motion also refers to the social situation here in Ontario. I would like to touch on that briefly. My community has been hurt very badly recently by the deaths of two young girls and by what appears to be the accidental death of a third young lady. It has created a great deal of fear and anxiety about our system of law and order and the safety of our streets. This random violence has to be something that we all condemn, especially violence against women.

I am glad to see that the federal government is putting money into such things as transition houses and other things that will fight violence against women. However, there is also a role to be played through our justice system. I am glad that the federal government has taken some steps in that regard. They include the Extradition Act amendments which prevent individuals such as Charles Ng and Joseph Kindler from getting the benefit of being in our country and having the protection of our system here.

June 5, 1992

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There is much discussion about the Young Offenders Act as well. It is interesting that the penalty for murder in the Young Offenders Act has been increased. Some people do not feel that is quite enough. There are jury considerations as to why the penalty of five years less a day was taken. Of course we should continue to review the young offenders' system. Perhaps through a system of education people will see that this system is not as lax as some seem to feel at the present time.

There is no provision for parole under the Young Offenders Act. Every sentence that is handed out under the Young Offenders Act is expected to be served for that entire term. Compared to an adult sentence, in a lot of instances the young offender is serving more time than the adult offender for a similar offence.

With regard to corrections, the corrections bill has been passed. I would like to read an editorial from the St. Catharines Standard, which says:

Judges should get a little more power and police should get a little relief as a result of a long overdue bill passed last week in the Commons.

Only criminals will regret the proposed law which will make it more difficult for violent criminals to get parole from prison. Victims and their families will welcome the fact that they will be provided with more information about offenders and their movements on parole or day passes, in addition to being allowed to attend parole hearings and give their views, regardless of a prisoner's wishes.

Defence lawyers and prisoners' rights advocates have criticized the bill, claiming it is a political over-reaction to a mistaken public belief that crime is increasing and the justice system is too lenient.

Fortunately, those who dispense justice and advocates of the rights of victims and society have finally had their voices heard, and Parliament has finally acted accordingly. It only remains for the Senate to do the same.

Improvements have been made and will continue to be made in the justice system. They include stronger firearms control, as well as the proposed rape shield law which is to be brought before this House. Also there is the drug strategy which is ongoing. I understand my friend from Scarborough-Rouge River discussed crack-houses. That certainly is something that must be considered in the justice area.

We have difficulties but we cannot allow them to darken our viewpoint and think that we are not going to be successful in this province and in this country. We are

going to be successful. There are many things that we can look forward to.

For my particular community the free trade agreement will provide opportunities that will be available in that community. We cannot turn our back on it and say that we do not want to have free trade in this globalized economy.

It is interesting that the NDP say that it wants to have none of it, that it wants to abrogate the free trade agreement. The opposite of the free trade agreement is tariff barriers around this country, tariff barriers around a country of 27 million people. That is not a sufficient market. It was at one time. It was during Macdonald's era and so on. It is not sufficient.

If we want to build tariff barriers around the country and throw a dispute resolution mechanism aside we do it at our peril. It has been negotiated so that we have access to the U.S. market and we have a dispute resolution mechanism. We do not want to return to tariff barriers. We do not want to return to a trade war.

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?

An hon. member:

Go to GATT.

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PC

Kenneth David Atkinson

Progressive Conservative

Mr. Atkinson:

The member says go to GATT. That was the argument that was used during the election campaign. What has happened? We have not been able to reach a resolution at GATT.

What were we going to do? Were we going to just sit there and not do anything? Were we going to allow ourselves to just be dependent on GATT with our largest trading partner? Could the House imagine what would happen to this country? Could the House imagine how bad this recession would be now if we did not have the free trade agreement?

I am glad that the Liberals have finally seen the light, reversed their 1988 position and said that they are going to support the free trade agreement with negotiations. We are waiting to see what they want to change. However, do not throw away the one opportunity that we have to make this country better. Do not depend on GATT. We have seen that. We are going to try to negotiate it but do not depend on it, because it is not coming about. We certainly hope it will but it has not at this point in time.

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PC

Steve Eugene Paproski (Deputy Chair of Committees of the Whole)

Progressive Conservative

The Acting Speaker (Mr. Paproski):

I regret the hon. member's time has expired.

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LIB

Dennis Joseph Mills

Liberal

Mr. Dennis Mills (Broadview-Greenwood):

Mr. Speaker, I first want to congratulate my colleague from Scarborough-Rouge River who advanced this motion on the economy today on behalf of all members in the Liberal Party. I thought it was actually quite a constructive day. I think that Canadians will have a lot to digest when they review the tapes this evening.

I want to address the member for St. Catharines who always adds to the level of debate in this House. I say that, however I could not let the people of Canada think that we are in support of the government's position on free trade. While the government's position is a deal at any price our position is quite different. If we cannot correct the flaws in the free trade agreement-and our member for Winnipeg-St. James has said this repeatedly, and I know the NDP are playing this cute little game saying that we are in bed with the government-then we would call for the six month abrogation.

I know there is only a second left, but I would like to salute the member on his comments about law and order. I know it must be a very difficult time for his community because of the tragedies that have happened there. I would urge him to urge his colleagues to bring some amendments to the Young Offenders Act forward to this House at the earliest possible moment. All of us on all sides of the House would be behind him.

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PC

Steve Eugene Paproski (Deputy Chair of Committees of the Whole)

Progressive Conservative

The Acting Speaker (Mr. Paproski):

I believe those were all comments, but if the hon. member has a little rebut he can go ahead. I will listen to him for 30 seconds.

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PC

Kenneth David Atkinson

Progressive Conservative

Mr. Atkinson:

Mr. Speaker, I thank the hon. member for his comments, but I am going from what his House leader indicated here. They said they are going to abrogate it if it cannot be renegotiated.

My hon. friend is a business person. He knows what it is like to negotiate a commercial agreement. He also knows about the give and take that has to go on in that regard.

We would certainly welcome their indication, probably before the North American free trade agreement, as to what they would like to see changed. That would be helpful.

Private Members' Business

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LIB
PC

Kenneth David Atkinson

Progressive Conservative

Mr. Atkinson:

One of the things I would like to see changed is the content on automobiles. I would love to see it go to 60 per cent or 65 per cent as I indicated in my speech. If that occurred, that would be fine. Let us not have these amendments that appear to me are going to be made in the NAFTA and would go back into the free trade agreement, and then have the Official Opposition come forward and say: "Those are not the ones that we want. We want something else".

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PC

Steve Eugene Paproski (Deputy Chair of Committees of the Whole)

Progressive Conservative

The Acting Speaker (Mr. Paproski):

It being four o'clock p.m., it is my duty to inform the House that pursuant to Standing Order 81(17), proceedings on the motion have expired.

Pursuant to Standing Order 30(7), the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.

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PRIVATE MEMBERS' BUSINESS

EXCISE TAX ACT

June 5, 1992