Aideen NICHOLSON

NICHOLSON, Aideen

Personal Data

Party
Liberal
Constituency
Trinity (Ontario)
Birth Date
April 29, 1927
Website
http://en.wikipedia.org/wiki/Aideen_Nicholson
PARLINFO
http://www.parl.gc.ca/parlinfo/Files/Parliamentarian.aspx?Item=608d24d3-2228-4a1c-9f28-30630d28a48f&Language=E&Section=ALL
Profession
executive director, social worker, teacher

Parliamentary Career

July 8, 1974 - March 26, 1979
LIB
  Trinity (Ontario)
  • Parliamentary Secretary to the Minister of Supply and Services (October 1, 1977 - September 30, 1978)
  • Parliamentary Secretary to the Minister of Consumer and Corporate Affairs (October 1, 1978 - March 26, 1979)
May 22, 1979 - December 14, 1979
LIB
  Trinity (Ontario)
February 18, 1980 - July 9, 1984
LIB
  Trinity (Ontario)
  • Parliamentary Secretary to the Postmaster General (March 4, 1980 - September 30, 1980)
  • Parliamentary Secretary to the Minister of Consumer and Corporate Affairs (March 4, 1980 - September 30, 1980)
September 4, 1984 - October 1, 1988
LIB
  Trinity (Ontario)

Most Recent Speeches (Page 1 of 191)


September 30, 1988

Miss Aideen Nicholson (Trinity):

Mr. Speaker, I have a supplementary question. Since the shares are priced to sell, the demand is strong, so would the Minister not agree that this $7 million was a frivolous and unnecessary expense?

Topic:   ORAL QUESTION PERIOD
Subtopic:   MINISTER'S POSITION
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September 30, 1988

Miss Nicholson (Trinity):

Mr. Speaker, the brokers I talk to tell me if they hyped an issue like this, they would lose their licences.

Topic:   ORAL QUESTION PERIOD
Subtopic:   PRIVATIZATION
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September 30, 1988

Miss Aideen Nicholson (Trinity):

Mr. Speaker, today we are continuing second reading debate on Bill C-140, an Act to amend the Bank Act. I have said on two other occasions in this House that haste in presenting Bills, followed by a very perfunctory study of the legislation, has become the hallmark of this Government.

In dealing with this legislation, the Government has really outdone itself. The Government enjoyed a long delay between tabling the legislation on June 30 and beginning second reading debate yesterday.

In his speech yesterday the Minister commended the positive contribution of the Standing Committee on Finance and Economic Affairs, yet he chose to delay action, despite the contribution of the finance committee, despite considerable prodding by members of his own caucus, and despite the unease of banking customers who wanted more clarity. Now suddenly he decides to act with lightning speed.

Yesterday the Minister had the arrogance to suggest that the House debate and pass the Bill at all stages even though he said that he had amendments which he did not yet have ready. Without seeing amendments we were being asked to deal with the Bill in all stages. Further, no text of the Minister's statement was provided in advance to the opposition Parties.

When the previous Liberal Government was in power it was customary to provide opposition critics with the text of ministerial statements three hours in advance. That is a

First, a report was commissioned by the committee staff because the committee wanted to have a clear picture of the extent of the problem so that we knew how far it extended over and above the letters we ourselves were receiving. The conclusion of that report has now been confirmed, and essentially it was that due to the unbundling of services, fees were imposed too quickly without adequate notice and in a manner that customers found insensitive.

According to the report prepared by the committee staff, routine financial service charges per family were averaging approximately $100 a year or $2 a week. That in itself is not a large amount, but customer irritation arose from the fact that some of these fees were unexpected and that information on them was difficult to find.

The committee went on to hold public hearings so that we could receive first-hand evidence of the extent of the problems from consumers, and also so that we could hear the responses of the financial institutions. On June 6, the committee tabled its report. The committee called on financial institutions to provide better information on charges, to provide certain basic services without charge such as the low balance accounts often held by children, and to prohibit certain charges altogether.

To give some examples, the committee recommended that the following fees be prohibited: fees to close an account which had been open for more than a year and fees levied when customers failed to make transactions on an account. The latter fees were particularly a source of irritation to customers who could not understand why they were being charged a fee for maintaining an account in which there had been no activity

September 30, 1988

Bank Act

and therefore no work done by the financial institution on their behalf.

The committee also proposed that the penalties for banks which failed to provide full and clear information and notice to customers be stiffened, and that the Office of the Superintendent of Financial Institutions create an internal office to deal with consumer complaints.

The banks responded defensively. The Canadian Bankers' Association stated that the committee's recommendations were interventionist and that they went against the stated free enterprise philosophy of this Government.

On June 23, I spoke in this House to an opposition motion by the New Democratic Party. Strangely, after tabling a minority report, the New Democrats then moved a motion to support the main committee report. I said at that time that neither the blatant bank bashing done by the New Democratic Party calling for regulation at any cost, nor the staunch Conservative anti-regulation, anti-interventionist policy were useful in this debate. More careful consideration is required in order to be fair and reasonable to all parties.

My own bias is always in favour of negotiation and agreement. I said then that regulation of financial service charges should be a last resort. This matter did not proceed very well because unfortunately, instead of admitting that they went too far too fast with their user-pay notion thus irritating, confusing, and inconveniencing their customers, the banks chose to be very defensive. Indeed, it was very much a botched public relations exercise on the part of the banks.

On June 30, the Government responded to the committee's report in the form of Bill C-140. However, earlier that week five of Canada's six major banks said that they would voluntarily comply with the committee's recommendations. The main purpose of the legislation at that time was to assure Canadians that the Government would monitor the bank's voluntary compliance.

Yesterday the Government decided to begin the debate at second reading at 12.30, even though the Minister's office previously informed me that the debate would begin at three o'clock and I had therefore arranged other business for that time. In my absence the Hon. Member for Ottawa-Vanier (Mr. Gauthier) responded to the introduction of the Bill.

On August 17, 1988, the Minister of State for Finance (Mr. Hockin) tabled the report of the Office of the Superintendent of Financial Institutions assessing the voluntary compliance of financial institutions in making the following changes: first, that recipients of NSF cheques not be charged for depositing those cheques in their personal accounts. Many people felt that it was hard enough when a cheque they were given bounced; for the bank to impose a very large penalty on them for depositing that cheque in all innocence seemed doubly harsh.

Second, the closing of personal accounts which have been opened for more than 90 days was no longer to be subject to a cancellation fee.

The other matters on which the voluntary compliance of financial institutions was assessed included no charge for basic personal accounts if the balance fell below a certain level; no charge for services rendered due to an error on the part of financial institutions; no increase in charges for administrative and transfer services on fixed term deposits, notes, and GICs during the term of those instruments; and customers with inactive accounts and balances greater than $10 would not be charged, providing they had responded to a letter advising them that the charge would occur.

What is the status now with respect to these areas? As of August 17, the survey done by the Office of the Superintendent of Financial Institutions, tabled in this House, indicated that four banks were complying with the letter and spirit of the voluntary measures agreed upon. One bank reported that it was in compliance except for the withdrawal of the NSF chargeback fee, which would be done by November, 1988. Another bank is in compliance except for the provision of a basic no-frills account.

As a result of that report a member of the standing committee withdrew his Private Members' Bill to legislate the measures, which now remain voluntary. It does appear that voluntary compliance has occurred for the large part. Furthermore, what is particularly important, consumers are now being well informed so they are aware of the issues and, if they are not happy with the services of one financial institution, they can always take their business elsewhere.

After the report was issued in August the Minister kept his Bill on hold for six weeks. Why? What was happening in the interim? On September 15, the Minister said that the Bill would now extend the same requirements to small business. The Canadian Federation of Independent Business told him of its concerns in April. Yet up until September 15 there was no indication of any response from the Government. The Minister said that he was satisfied that the competitive market-place would solve all the ills.

However, the position of the CFIB is that increased competition in the financial institution sector is hurting more than helping small business. According to the CFIB, because of deregulation, because the banks are much more aggressively pursuing large accounts, profit margins on big business lending have decreased and, as a result, financial institutions are imposing larger and more numerous charges on small businesses. Cost saving actions undertaken by financial institutions, such as closing branches in small towns, also leave small business persons without any nearby financial institution with which to deal.

Although the committee was dealing only with consumer accounts, the small business concerns as presented to it are important for three basic reasons. First, small businesses typically have less choice in their financial dealings than do

September 30, 1988

personal customers because their freedom to switch business relationships with banks is more restricted than for the individual consumer. Second, the magnitude of service charges to small business is proportionately greater, often totalling hundreds of dollars. Third, unpredictable and sizeable changes in bank service charges can have dramatic negative impacts on the ability of small business to plan operations and cash flow, and could in turn affect the viability of the business itself.

The CFIB asked government for something it usually does not ask for, government intervention, so as to ensure the measures taken voluntarily by the banks for consumers are applied to small businesses as well. Yet the Minister of State for Finance maintained in his statement of September 15 that he expects increased competition in the financial sector to be the best method of ensuring reasonable service charge practices.

The CFIB continued to make some very specific recommendations. It wanted very complete information regarding current levels of and changes to service charges for small businesses. It wanted the elimination of chargeback fees for NSF cheques. It also wanted annual monitoring of bank practices with regard to small businesses.

The CFIB tried to negotiate with the Canadian Bankers' Association but made no headway, particularly on the NSF chargeback issue. The Government has given no quarter either. In its announcement to extend similar disclosure and complaint resolution benefits to businesses, it does agree with the recommendation on eliminating chargeback costs for NSF cheques.

The Government has released a statement of what it intends for small business, but we have not seen the actual amendments. We have been told what will be in them and, consistent with what is now proposed for personal accounts, we are told that the amendments to Bill C-140 and the draft regulations will first entitle businesses, when they open accounts, to receive an enhanced disclosure of charges applying and information on the institution's procedures for handling complaints. Second, they will entitle businesses to ensure that banks and other financial institutions make available to the public for examination, on request, a list of all charges for business services in their branches doing commercial business; third, to provide for ongoing disclosure of core account related business charges through a brochure available to the public; fourth, to provide 30-day pre-notification, through statements, of changes in account related charges.

The Office of the Superintendent of Financial Institutions will also mediate complaints on behalf of small business account holders. So far so good but, Mr. Speaker, I would feel much better about dealing with this if I had seen the actual text of the amendments.

The Government has promised to continue monitoring the situation. My Party and I will be watching closely to see if the

Bank Act

disclosure of information on financial service charges continues. We will also carefully monitor whether consumers and small businesses are treated with fairness and consideration in the weeks to come.

As of yesterday the Minister was converted to being a supporter of small business, whereas before September 15 he was an ally of unbridled competition. Yesterday he also became a supporter of government intervention.

By the time he rose in the House yesterday, he still did not have amendments to offer the Opposition. We were expected to take all these flip-flops on face and vote blindly for whatever he provided us, and he wanted the amendments dealt with in Committee of the Whole. The amendments finally reached my office late last night, which surely was not the Minister's idea of giving them to us in time to study. I am in favour of what I am told we are going to have, but the Minister's "trust me" approach in presenting and debating pieces of legislation is decidedly irritating. It does not inspire confidence and we will want those amendments carefully examined.

Topic:   GOVERNMENT ORDERS
Subtopic:   BANK ACT
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September 30, 1988

Miss Aideen Nicholson (Trinity):

Mr. Speaker, my question is for the Acting Minister of Privatization.

Can the Minister confirm that $7 million has been assigned for marketing and advertising of the Air Canada share issue? Can he explain why, since this would appear to contravene the regulations of the Ontario Securities Commission and other securities commissions?

Topic:   ORAL QUESTION PERIOD
Subtopic:   PRIVATIZATION
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September 30, 1988

Miss Nicholson (Trinity):

Did you have to spend $7 million?

September 30, 1988

Oral Questions

Topic:   ORAL QUESTION PERIOD
Subtopic:   MINISTER'S POSITION
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