Proceedings of the Standing Senate Committee on
Banking, Trade and Commerce
Issue 1 - Evidence
OTTAWA, Wednesday, February 25, 2009
The Standing Senate Committee on Banking, Trade and Commerce met this day at 4 p.m., pursuant to rule 88 of the Rules of the Senate, to organize the activities of the committee.
[English]
Line Gravel, Clerk of the Committee: Honourable senators, the first item on the agenda is the election of a chair. Pursuant to rule 88, it is my privilege as the clerk of your committee to preside over the election of the chair.
Senator Goldstein: I have the honour and the great pleasure to nominate Senator Michael Meighen as chair of this committee.
He has served it well for a long time and he will serve it yet better in that position.
Senator Massicotte: I wanted to nominate him as chair.
Ms. Gravel: Are there any other nominations?
Are you ready for the vote?
Hon. Senators: Yes.
Ms. Gravel: It is moved by the Honourable Senator Goldstein that the Honourable Senator Meighen take the chair of this committee. Those in favour?
Hon. Senators: Agreed.
Ms. Gravel: Those against?
Abstentions?
Carried.
[Translation]
Senator Michael A. Meighan (Chair) takes the chair.
The Chair: As some of you very well know, this is one of the few elections I have won in my long political career. Thank you, my dear friends and colleagues, I appreciate your confidence immensely.
[English]
I will do my utmost to live up to Senator Goldstein's kind words and to the support you have shown me. If I can exit this role, whenever that happens, as having been fair and with the committee having accomplished good work, I will be well pleased and satisfied. I thank you for entrusting me with this responsibility.
I will move immediately to the items of business that we have. The second item is the election of a deputy chair.
Senator Oliver: Mr. Chair, I would be pleased to nominate Senator Goldstein to be the deputy chair of this committee.
The Chair: Thank you, Senator Oliver. Are there any other nominations?
Nominations have ceased. I will declare that, on motion of Honourable Senator Oliver, Honourable Senator Goldstein be the deputy chair of this committee. I extend my congratulations to him and thank him for taking this on.
Many of you know this, but I have known the deputy chair for many years. He was a distinguished member of the Montreal bar. I pleaded automobile accidents and the like while he was dealing with high-level bankruptcies, including one where I was a director of the company. I was greeted one day by a bailiff with a writ for hundreds of thousands of dollars of unpaid wages, and thanks to the expertise of Senator Goldstein, I was able to qualify on a monetary basis for the Senate when I was summoned.
Senator Goldstein: You should make it abundantly clear that you were one of seven defendants. I did not represent any of the others. You won your case and the other six lost.
The Chair: That is further proof of the senator's qualities. Welcome, Senator Goldstein, and thank you for agreeing to serve as deputy chair.
Honourable senators, item 3 is a motion on a subcommittee on agenda and procedure, otherwise known as the steering committee. Is someone prepared to move the following:
That the Subcommittee on Agenda and Procedure be composed of the chair, the deputy chair, and one other member of the committee, to be designated after the usual consultation; and
That the subcommittee be empowered to make decisions on behalf of the committee with respect to its agenda, to invite witnesses, and to schedule hearings.
Senator Oliver: So moved.
The Chair: Is there further discussion?
All in favour?
Hon. Senators: Agreed.
The Chair: Is anyone opposed? Are there any abstentions?
Carried.
Turning to item 4, would somebody like to move that we print the committee's proceedings?
Senator Fox: So moved.
The Chair: It was moved by the Honourable Senator Fox:
That the committee print its proceedings; and
That the chair be authorized to set the number to meet demand.
I am told by the clerk that we have reduced what used to be the number and we now issue about 350 copies. If there is a great demand because of the nature of our work, we can always print more. Is that correct?
Ms. Gravel: Yes.
The Chair: There is the motion of Senator Fox. All in favour?
Hon. Senators: Agreed.
The Chair: Abstentions? Carried.
We move now to the authorization to hold meetings and to print evidence when quorum is not present.
Senator Ringuette: So moved.
The Chair: It was moved by Honourable Senator Ringuette:
That, pursuant to rule 89, the chair be authorized to hold meetings, to receive and authorize the printing of the evidence when a quorum is not present, provided that a member of the committee from both the government and the opposition be present.
Is there any further discussion? All in favour?
Hon. Senators: Agreed.
The Chair: Is anyone opposed? Are there any abstentions? Carried.
Turning to the financial report, would somebody be prepared to move:
That the committee adopt the draft first report, prepared in accordance with rule 104.
The report is in your materials.
Those are expenditures we have already incurred. I do not know whether the bills have been paid.
Are you moving that item, Senator Oliver?
Senator Oliver: Yes.
The Chair: Is there further discussion? All in favour?
Hon. Senators: Agreed.
The Chair: Opposed? Carried.
Turning to research staff, would someone be prepared to move:
That the committee ask the Library of Parliament to assign analysts to the committee;
That the Subcommittee on Agenda and Procedure be authorized to retain the services of such experts as may be required by the work of the committee; and
That the chair, on behalf of the committee, direct the research staff in the preparation of studies, analyses, summaries, and draft reports.
Senator Massicotte: So moved.
The Chair: Is there further discussion? All in favour?
Hon. Senators: Agreed.
The Chair: Opposed, if any? Are there abstentions? Carried.
I have a question for Ms. Gravel: When it says "the chair,'' in the chair's absence would it be the deputy chair?
Ms. Gravel: Yes.
The Chair: May we have a motion with respect to authority to commit funds and certify accounts?
Senator Harb: So moved.
The Chair: Senator Harb moves:
That, pursuant to section 7, chapter 3:06 of the Senate Administrative Rules, authority to commit funds be conferred individually on the chair, the deputy chair, and the clerk of the committee;
That, pursuant to section 8, chapter 3:06 of the Senate Administrative Rules, authority for certifying accounts payable by the committee be conferred individually on the chair, the deputy chair, and the clerk of the committee; and
That, notwithstanding the foregoing, in cases related to consultants and personnel services, the authority to commit funds and certify accounts be conferred jointly on the chair and deputy chair.
Hon. Senators: Agreed.
The Chair: Any opposition? Abstentions? Carried.
Senator Banks, you look as though you have a question.
Senator Banks: Not on this committee.
The Chair: We understand.
Is someone prepared to move a motion with respect to travel:
That the committee empower the Subcommittee on Agenda and Procedure to designate, as required, one or more members of the committee and/or such staff as may be necessary to travel on assignment on behalf the committee.
Senator Greene: I so move.
The Chair: All in favour?
Hon. Senators: Agreed.
The Chair: Opposed? None. Therefore, the motion is carried.
Next is item 10, "Designation of members travelling on committee business.'' Is someone prepared to move:
That the Subcommittee on Agenda and Procedure be authorized to:
1) determine whether any member of the committee is on "official business'' for purposes of paragraph 8 (3)(a) of the Senators Attendance Policy, published in the Journals of the Senate on Wednesday, June 3, 1998; and
2) consider any member of the committee to be on "official business'' if that member is: (a) attending an event or meeting related to the work of the committee; or (b) making a presentation related to the work of the committee; and
That the subcommittee report at the earliest opportunity any decisions taken with respect to the designation of members of the committee travelling on committee business.
Senator Ringuette: I so move.
The Chair: Thank you. All in favour?
Hon. Senators: Agreed.
The Chair: Carried.
[Translation]
The Chair: Travelling and living expenses of witnesses.
It is moved by the Honourable Senator Goldstein:
That, pursuant to the Senate guidelines for witness expenses, the committee may reimburse reasonable travel travelling and living expenses for one witness from any one organization and payment will take place upon application, but that the chair be authorized to approve expenses for a second witness should there be exceptional circumstances.
Is it agreed?
Hon. Senators: Agreed.
[English]
Next is "Electronic media coverage of public meetings.'' Is someone prepared to move
That the Subcommittee on Agenda and Procedure be empowered to allow coverage by electronic media of the committee's public proceedings with the least possible disruption of its hearings at its discretion.
Senator Oliver: So moved.
The Chair: Further discussion? All in favour?
Hon. Senators: Agreed.
The Chair: Opposed, if any? Carried.
[Translation]
Item 13: Time slot for regular meetings.
As you can see, Honourable Senators, there is a small change, not to the Wednesday schedule when we sit from 4:00 p.m. to 6:00 p.m. as in the past, but on Thursdays when, from now on, we will sit from 10:30 a.m. to 12:30 p.m. Previously, we sat from 10:45 a.m. to 1:00 p.m., but that time slot caused problems for the clerk and her team in preparing the motions that arose.
Senator Goldstein: Quite often, it caused us problems too.
[English]
Senator Goldstein: When we ran over to get to the sittings of the Senate on time, we thought it was wise to start a little earlier and finish a little earlier.
[Translation]
Senator Massicotte: On the other hand, from time to time, we may want to extend our meetings, particularly when we have important guests. In those special circumstances, can we not go a few minutes longer?
The Clerk:I think that there is a decision whereby only the whips can allow us to move out of our time slot. But we can certainly go a few minutes longer when we have an important witness and when we have work to do, we can do that.
Senator Massicotte: And have we asked the whips? Why would they object?
The Clerk: It was the whips who decided on this new schedule.
Senator Massicotte: I know, but can we ask for exceptions, if we have a request that justifies it?
The Clerk: Yes, absolutely.
Senator Fox: There can be conflicts, though.
Senator Massicotte: I sometimes have meetings until 1:15 p.m., 1:20 p.m.
The Clerk: Then we would ask for special permission, if we needed to.
[English]
Senator Banks: The beginning times on Wednesdays at four o'clock was subject to a point of order. Since the Senate stops sitting at 4 p.m., I wonder whether you might want to consider making it 4:15 p.m.
Senator Goldstein: We have the following problem in doing that. I appreciate that we have to scurry from the Senate to this building at three minutes to four and we sometimes leave before the Senate has terminated its sitting, which is not a good thing but if we were to start at 4:15, presumably we would have to go to 6:15. This room has another committee sitting here at 6 p.m. I am afraid we will have to live with the scurrying that we all could have done at a younger age and that we still try to do.
The Chair: Senator Eyton, if you could get your name on the list, then you could propose a time slot for the meeting.
Any further discussion? If not, all in favour?
Hon. Senators: Agreed.
The Chair: Opposed? Abstentions? Carried.
Item 14, "Other Business.''
Senator Ringuette: All of you are certainly aware that I have a motion in the Senate right now that should be destined for this committee. I do not know when your steering committee will be meeting to look at agendas for our work, witnesses, and so on, but I hope that, as soon as the motion is referred to our committee, we will be ready to undertake the study mentioned in my motion.
I do not know what other work is destined for this committee, but I know that this motion is; I hope that we will entertain it as soon as possible.
The Chair: Thank you. We obviously do not control when it gets out of the Senate, but when it does — and, if it is referred to us then we will certainly take your views into consideration. It is a responsibility of the steering committee to schedule the work, but I cannot speak for the committee. We have formed it but we have not named anyone to it, have we?
The Clerk: Not yet.
Senator Harb: The committee has done a number of initiatives and we have a number of studies. In the same spirit, perhaps the steering committee can look at what we have been up to and where we are at the present time. We can then set up a list of priorities for how to deal with all the issues, taking into consideration that we will have a massive bill coming from the other place dealing with the budget.
The Chair: That is not coming to us.
Senator Harb: It will not come to this committee?
The Chair: No. We do not have much in the way of government legislation, but I do not want to speak for the steering committee. I propose that the steering committee meet next Wednesday and that we reconvene on Thursday to discuss what the steering committee, in its wisdom, has come up with, and then we can settle our work plan. Is that satisfactory?
Senator Goldstein: It is either traditional or part of the rules I am not sure which of the two that government bills referred to this committee come before inquiries, and private members' bills also come before inquiries. As the chair has pointed out, there are no bills forthcoming. Hopefully, we will be able to deal with your inquiry, if it gets out of the chamber and is referred to us.
The Chair: I am not speaking for the steering committee, but I will propose to the steering committee that one thing we might do at this juncture, in the absence of a great deal of government legislation, is to hear from senior officials, such as the head of the Office of the Superintendent of Financial Institutions, OSFI, and other such government agencies, who are very much in the forefront of dealing with the present economic situation, to see what they have in mind and how they are handling it. They can be scheduled here and there.
Then, of course, we will want to meet with the Governor of the Bank of Canada, who has a heavy schedule. I suspect it will not be until the early part of May before we meet with him, because of a variety of engagements, including a political party's convention in Vancouver at the end of April. He travels a great deal. We are in negotiations with him and we will get a date, no later than early May.
Senator Fox: Who else do you have in mind as guests?
The Chair: The Financial Consumer Agency of Canada, FCAC; the Canada Deposit Insurance Corporation, CDIC; the Minister of Finance; and perhaps in a monthplus, the Parliamentary Secretary to the Minister, Mr. Menzies, who is undertaking a monthlong inquiry across the country into private pension plans.
Senator Fox: Would you consider inviting anyone from some of the think tanks in the country who would have a point of view to bring to us?
The Chair: Sure. If you have a suggestion in particular, you might speak to Senator Goldstein.
Senator Massicotte: I presume the issue is that we should make our contribution to the regulatory regime that the world is thinking about. I presume that is the purpose of these particular meetings, to come up with our recommendations of how to manage the world financial system.
Senator Goldstein: I do not think we would be equipped to do that, unless we undertook a significant and indepth study. I need hardly tell you, since you know this better than I because of your experience and background, the world financial situation is in a state of terrible flux. We could spend two months listening to all kinds of experts telling us all sorts of things and not be very much further ahead.
I think it is more important for us to try to learn what the current situation is from the people who are the regulatory authorities, who are responsible for managing the financial fabric of our country. That is why we were thinking of asking people from OSFI and having the governor of the bank and others come before us. However, you might have a particular inquiry that you want to propose.
Senator Massicotte: If it is simply to educate us, that is all very good, but we can probably read that in an article. As you know, the world, Spain, our banks are not falling over. We should at least make a comment to say what our experience is and to at least have some objective to these meetings as opposed to simply educating ourselves.
The Chair: We are still in public. We are not in camera. Often these discussions go on in camera, and I think that is the best place to thrash them out.
Senator Eyton: I tend to agree with Senator Massicotte that a knowledge base is critical. However, when all this is done, there will be a pretty good understanding of balance sheets and cash flows and all the historic data we look at.
Personally, I would like to suggest that the committee at least in some of its deliberations it look at mechanisms for ensuring that credit is extended. The government is pushing a rope, and not only here but in the U.S., Britain and everywhere else. They are saying the balance sheets are good, please do it, and somehow credit does not get extended.
The question is whether there a mechanism that can do that. Maybe there is not one. Maybe the people in charge just will not do it and there is nothing that will make them do it, but it seems to me there must be some device that ensures and encourages the granting of credit to businesses and people. The question is how do you do that.
The Chair: I think indirectly, if not directly, you could slot that in under Senator Ringuette's motion.
Senator Ringuette: If it is the wish of the committee. Certainly the cost of credit and the extent of credit are part of that motion. In connection with Senator Eyton's statement, I think we should also entertain the Business Development Bank of Canada, BDC, with regard to the extent of credit to the business community. They have received a certain directive to do so. How will they do so, how quickly and at what cost?
Senator Massicotte: I need to repeat: the world is going through a very difficult time. People are being immensely affected by a lack of credit. We are the Banking, Trade and Commerce Committee, and we are all paid and we all have significant experience. We should spend some time pinpointing an area that we can make a contribution to and that merits our time. This is super important. We are the Banking, Trade and Commerce Committee. If any committee is going to do this, it should be ours. We can study a lot of issues, but this is very important. We should spend some time, not to be experts on the whole world matter, but to choose an area, like liquidity, and make our contribution.
The Chair: There have been some good suggestions. If I may, I would like to come back next Thursday and have that discussion. We will make a proposal to the steering committee. No doubt, you will want to propose some modifications.
Senator Oliver: In the meantime, would it be okay if we, as members, send a letter to you or to the clerk with some of the matters we think might fit within the rubric set forth by Senator Massicotte — securitizations and so forth, not just credit?
The Chair: That would be most welcome.
Is there any other business? If not, could I have a motion for adjournment?
Senator Eyton: I am on a roll. So moved.
The Chair: I do not think it is debatable, is it?
Carried.
The committee adjourned.