Debates of the Senate (Hansard)
1st Session, 36th Parliament,
Volume 137, Issue 113
Thursday, February 18, 1999
The Honourable Gildas L. Molgat, Speaker
Table of Contents
Thursday, February 18, 1999
The Senate met at 2:00 p.m., the Speaker in the Chair.
Hon. Joyce Fairbairn: Honourable senators, today literacy
advocates and learners are moving through our corridors, taking their message
to over 80 parliamentarians on this our annual Literacy Action Day. I want to
thank those senators who are setting aside time to meet with them and to listen
to what they have to say.
At a time when we are exhorting Canadians to get cracking and prepare
themselves for the demands of the new century, we should think carefully about
the message we are hearing today. Millions of Canadians, over 40 per cent of
our adult citizens, have varying degrees of difficulty with reading, writing
and life skill tasks that everyone in this chamber takes for granted. Many of
them have learned to cope in other ways, to the point that they do not believe
they have a literacy problem. Others are afraid to come forward to seek help in
case they may lose any of the gains they have made in life.
Behind these statistics, honourable senators, are real people. They are
children growing up without an early motivating force to learn. They are
teenagers falling through the cracks because they cannot read and communicate
well enough to stay in school, finish school, or get a job. They are parents
who put themselves and their families at risk because they cannot read
instructions on medication or on dangerous substances. They cannot read to
their children. They are workers who need to learn new skills in a highly
technological society. They are seniors, many of them women, often single,
unable to ease their loneliness and their pain with the comfort of a book as a
The literacy community and its army of volunteers have worked hard to bring
programs to those most in need across the country, on the ground, where people
live and learn. We have done this in church basements, on factory floors, in
buses transporting workers to farms, and on urban streets, through high-tech
distance learning and in hidden rooms where no one else can see or hear.
This is a huge issue, honourable senators, and no one sector or group can
tackle it alone. That is why we have put together a strong network of partners,
including federal and provincial governments, business, labour, educators, and
the national organizations and their coalitions who are here today - ABC
Canada, La fédération canadienne pour l'alphabétisation en
français, Frontier College, Laubach Literacy of Canada, the Movement for
Canadian Literacy, and the National Adult Literacy Database. I should also
mention my own precious affiliation, the National Literacy Secretariat of
Canada, which works on behalf of the federal government.
Honourable senators, these people are talking to us about health care, about
justice, about corrections, about employment and about aboriginal people.
Overall, they are talking about life-long learning. If we do not use our
literacy skills, we will lose them. Any adult learner will tell you of the pain
and frustration, and very often the fear involved in trying to learn again.
If you think of it, honourable senators, literacy is a foundation for most of
what we do in life as individuals and as a country. Parliamentarians should not
have to be dragged into this issue. It is the substance of so many of the lives
in their constituencies and their provinces.
Honourable senators, in the Senate we have been supportive over the years but I
think we need to use our position to show leadership. One of the toughest
challenges for literacy is awareness and understanding.
You have all received invitations to attend the Literacy Action Day reception
at five o'clock this afternoon in the Aboriginal Peoples' Room. Please come and
meet the advocates who care so much, and the learners who have become our best
teachers. You will hear stories that will make you cheer, and even shed a few
tears. I can guarantee you will be inspired, and I hope you will leave willing
Hon. Mabel M. DeWare: Honourable senators, I rise with pleasure
today to speak about an issue that is critical to the health and well-being,
both social and economic, of Canadians. It is also a subject very close to my
heart, and that is literacy.
Today is Literacy Action Day. It has been sponsored every year since 1993 by
six national organizations active in the field. The programs provided by these
groups are a lifeline to many adult Canadians who do not have the reading and
writing skills they need to fully benefit from all that Canada has to offer. I
should like to take this opportunity to thank them for their hard work and
Literacy Action Day is an opportunity for each and every one of us to think
about all that literacy means and what we can do at the federal level to help
promote it. Those of us who are fortunate enough to be able to read and write
our way through modern society with ease often take our literacy skills for
granted. However, we must not forget that for many Canadians these skills are
not there or they are not developed enough. The problems associated with their
lack of literacy range from poor health to underemployment and joblessness.
There are other quality-of-life issues that are not as apparent but just as
painful. Think of the mother who cannot read her child a bedtime story, the
senior who cannot understand the directions on a medicine bottle, or the
teenager who cannot fill out an application for a driver's licence.
The 1994 International Adult Literacy Survey found that an alarming 22 per cent
of Canadians 16 years and over have serious difficulty reading printed
materials. Another 24 per cent to 26 per cent can only deal with material that
is simply and clearly laid out, and material in which the tasks involved are
not too complex. It is indeed a cause for alarm that close to half of adult
Canadians lack proper literacy skills.
Honourable senators, we must continue to build on the momentum created by the
former Progressive Conservative government to improve the literacy of
Canadians. It was the first federal government to recognize that literacy is an
issue of national importance and requires cooperative national action. The
creation of the National Literacy Secretariat in 1988 confirmed Ottawa's
leadership potential in this crucial area, and I urge the current government to
continue to provide that body with the support it so richly deserves.
At this point, honourable senators, I should like to compliment the former
leader of the government in the Senate, the Honourable Joyce Fairbairn, as she
continues her role on this committee.
Honourable senators, in my previous life as minister of community colleges and
minister of advanced education in New Brunswick, I was privileged to be able to
play a small role in improving literacy for my fellow New Brunswickers. I
remember in particular one woman who asked me if she could get a position in a
program being offered in a New Brunswick community college called NBCC, and I
managed to do that for her. When she proudly received her certificate in 1984,
she presented me with a poem that she had written herself. I have it hung in
my office today, and I should like to read it to you. It is entitled "The
Graduate," and it reads:
When I leave this place tomorrow, Though I'll feel a little sorrow I look
forward to a life Wherein I'm not just someone's wife. An individual at last,
Not thinking that all time has passed And left me high and dry and old And
withering and feeling cold. I've learned some pretty nifty things, And once
again my feet have wings. I'm racing on to greater things With the confidence
that knowledge brings And though my house is looking worse, It doesn't make me
want to curse For if at times I feel I must Perhaps I'll rearrange the dust Or
make the beds or do some cooking, Or maybe I'll just stand there looking. I
wonder, is this really me? Oh! Thank you, thank you, N.B.C.C.
Hon. Ethel Cochrane: Honourable senators, today across Canada
is Literacy Action Day. Since 1993, we have designated this day to recognize
the work of national and local literacy organizations and to promote awareness
of the need for continued support for literacy.
It is estimated that between 7 million and 10 million Canadians cannot work
well with words and numbers. For those with low literacy levels, that affects
every aspect of their life, personal, social and economic. We speak glowingly,
as the Minister of Finance did in his budget speech on Tuesday, of our
movement towards a knowledge-based society and economy. However, participation
in that society and economy is increasingly barred to those many Canadians who
lack the necessary basic skills.
In our country, honourable senators, literacy levels decrease as we move from
west to east. The lowest level is found in my province of Newfoundland and
Labrador. There are very dedicated people in that province, as there are
throughout Canada, who work to provide others with those badly needed basic
skills. Yet many of their centres are suffering from lack of adequate funding
Last June, a literacy centre in Griquet, which is near St. Anthony on the
Northern Peninsula, closed down. Two weeks ago, an adult literacy centre in
Deer Lake closed due to lack of funding. Lo and behold, this coming June,
another centre in Corner Brook is due to close. Honourable senators, it is
against this background that literacy organizations today are appealing for
your support. The Literacy Development Council of Newfoundland and Labrador has
set up information displays in shopping malls right across the province. The
council is encouraging schools to participate in Newfoundland and Labrador
Read-In 1999. There are many similar activities sponsored by literacy
organizations everywhere in Canada.
On Literacy Action Day, I urge honourable senators to give some thought to how
literacy affects all our lives and to support the efforts of local, provincial
and national literacy organizations.
Bill to Amend-Report of Committee
Hon. Lorna Milne, Chair of the Standing Senate Committee on
Legal and Constitutional Affairs, presented the following report:
Thursday, February 18, 1999
The Standing Senate Committee on Legal and Constitutional Affairs has the
honour to present its
Your committee, to which was referred Bill C-57, to amend the Nunavut Act
with respect to the Nunavut Court of Justice and to amend other Acts in
consequence, has, in obedience to the Order of Reference of Thursday, December
10, 1998, examined the said bill and now reports the same without amendment.
Your committee does, however, feel it is important to underscore certain issues
concerning the context in which the Nunavut Court of Justice is to operate.
Your committee is of the view that the fair administration and implementation
of justice in the new territory of Nunavut requires great vigilance. Your
committee considers this to be particularly the case in respect of the
appointment and training of justices of the peace, who will play a pivotal role
in the Nunavut justice system. It is equally essential that minority rights be
protected in all other areas of justice delivery.
The Hon. the Speaker: Honourable senators, when shall this
bill be read the third time?
On motion of Senator Milne, bill placed on the Orders of the Day for third
reading at the next sitting of the Senate.
Royal Canadian Mint Act Currency
Bill to Amend-Report of Committee
Hon. Terry Stratton, Chairman of the Standing Senate
Committee on National Finance, presented the following report:
Thursday, February 18, 1999
The Standing Senate Committee on National Finance has the honour to present its
Your committee, to which was referred Bill C-41, to amend the Royal
Canadian Mint Act and the Currency Act, has, in obedience to the Order of
Reference of Wednesday, December 9, 1998, examined the said bill and now
reports the same without amendment.
TERRANCE R. STRATTON
The Hon. the Speaker: Honourable senators, when shall this
bill be read the third time?
On motion of Senator Carstairs, bill placed on the Orders of the Day for third
reading at the next sitting of the Senate.
The Budget 1999
Statement of Minister of
Hon. John Lynch-Staunton (Leader of the Opposition):
Honourable senators, I give notice that on Tuesday, March 2, 1999, I will call
the attention of the Senate to the budget presented by the Minister of Finance
on February 16, 1999.
Internal Economy, Budgets and
Administration Committee-Allegations of Failure to Employ Deficit-Cutting
Measures-Position of Chairman
Hon. Noël A. Kinsella (Acting Deputy Leader of the
Opposition): Honourable senators, my question is directed to the Chairman
of the Standing Committee on Internal Economy, Budgets and Administration.
I read in a newspaper article this morning that Mr. Gallaway, a member of the
other place, is reported to have said that the Senate did not cut back like the
House of Commons did when the government was eliminating the deficit. Could the
Chairman of our Internal Economy Committee speak to that matter, as well as
some of the other glaring errors that are reported from that source?
Hon. Bill Rompkey: Honourable senators, I appreciate the
question of the honourable senator. It is unfortunate that we cannot get some
honest reporting about the Senate in this town. What appeared in the press this
morning is diametrically opposed to what I said yesterday in this chamber,
although the reporter actually listened to the audio recording of what
I said yesterday, and I repeat again today, we have exercised restraint. If
honourable senators look at the figures for 1991-92, they will see that we had
a decrease in our budget of 9 per cent, while the House of Commons had an
increase in its budget of 1.1 per cent. We have cut to the bone since 1991-92.
In fact, this year we are just getting back to 1991-92 expenditures in real
Honourable senators must remember that the House of Commons has been televising
committees for years. We are just putting an infrastructure in place now. It
costs money. The House of Commons has had a housing allowance for years. We are
just starting to build that in. It, too, costs money.
We have some catch-up to do in terms of the ability of our staff and the tools
they need to do the work they have to do. We need more people. We have a lot
more work to do and we have to put the people in place to do it. Clearly, we
are starting to build the process of catch-up responsibly.
In terms of our restraint program, we started that process before the House of
Commons and we have matched them dollar for dollar in restraint. Our record in
that regard is nothing to be ashamed of.
Hon. Norman K. Atkins: Honourable senators, I, too, should like
to ask a question of the Chairman of the Standing Committee on Internal
Economy, Budgets and Administration.
Has the member of Parliament mentioned been instructed in your caucus about
this kind of information so that he can be straightened out on some of the
things that he is saying in public?
Senator Rompkey: Honourable senators, I cannot talk about what
goes on in caucus, any more than senators opposite can. What I can say is that
there are many people on this side of the chamber who would like to straighten
out that honourable member. I can say openly that some people have taken
certain steps in that regard already. I will leave it at that.
Internal Economy, Budgets and
Administration Committee-Restraint in Senators' Budgets-Position of Chairman
Hon. Thérèse Lavoie-Roux: Honourable senators,
my question is also directed to the Chairman of the Standing Committee on
Internal Economy, Budgets and Administration.
Can the chairman of the committee tell me if the scale of entitlement which was
approved a few years ago to restrain the expenses in senators' offices is being
respected? I have just heard about a senator, who is not new to this place, and
who is having his office almost entirely redone at a cost of $15,000. I cannot
see how that kind of expenditure can be approved.
Hon. Bill Rompkey: Honourable senators, we are holding the line
on the overall budgets of senators. In this year there will be no increase,
which is another example of exercising restraint.
With regard to expenditures on actual physical equipment, there will be some. I
have a list with the names of about 15 to 20 senators, which I do not have with
me, who will be having repairs done to their offices. I would not call these
exorbitant amounts. I do not think that $5,000 or $10,000 is an exorbitant
amount to spend on repairs and needed furnishings. For example, some people had
to have doors installed in their offices to connect one room to another. These
things had to be done, and I do not think the costs are exorbitant.
Search and Rescue
Program-Maintenance Program for Sea King Helicopters-Contingency Plans in Event
of Failure-Government Position
Hon. J. Michael Forrestall: Honourable senators, I rise with
some sadness and with a heavy heart. We have now had another incident where a
Sea King helicopter was forced to land. That happened about 28 kilometres out
at sea, when transmission or hydraulic problems developed.
This week's budget said nothing with respect to capital equipment; nothing to
address the question of the replacement of the Sea Kings. I ask the minister:
What contingency plans does the government have? I ask that because it is clear
from the budget that the attitude of this government has now moved from risk
management with respect to deployment and use of the Canadian Armed Forces to a
posture of calculated risk-taking. That is quite different from risk
management. One of these days we will face tragedy unless something is done,
and done very quickly. I repeat: Does the government have any contingency
Hon. B. Alasdair Graham (Leader of the Government): Honourable
senators, the Sea King fleet at Shearwater has not been grounded.
Senator Forrestall: Perhaps it should be.
Senator Graham: Some of the helicopters are scheduled to deploy
for exercises with the navy in the next few days. As the Honourable Senator
Forrestall is aware, one of the squadron of Sea Kings stationed at Shearwater
recently experienced technical problems. The commanding officer has therefore
decided to stop all non-essential flights to ensure that the helicopters are
ready for the exercise. However, Sea King helicopters and crews at Shearwater
will continue to be available to participate in search and rescue missions.
As I have said on many occasions, honourable senators, we do not intend to fly
unsafe aircraft. When a problem occurs with our helicopters, that problem is
tracked down and identified. The cause of the problem is then identified and
fixed. It is regrettable that there was that incident off the coast of Nova
Scotia yesterday but, again, officials are attempting to identify the problem
and remedy it immediately.
Search and Rescue Service-Number
of Emergency Helicopter Landings-Request for Tabling of List
Hon. J. Michael Forrestall: Honourable senators, "restricted
flight" is not "grounding." I am sorry that I inadvertently used
that term, because that is the very next step.
It is now about two years since we began to see a rapid development in problems
with the Sea Kings. Could the minister undertake to have someone in the
department table for us here in the chamber a list of all of the emergency
landings undertaken of necessity by Sea Kings in the period of the last two
Hon. B. Alasdair Graham (Leader of the Government): Honourable
senators, if that is appropriate and if the information is available, I am
certainly prepared to do so.
I will consult with my colleague the Minister of National Defence with
reference to the incident that was reported yesterday. The pilot decided to
make a precautionary landing after experiencing some difficulties with the
mechanical controls of the helicopter.
Senator Berntson: Yes, before it fell out of the sky.
Senator Graham: The crew landed safely, and they were in
complete control. No one was injured. An investigation has been undertaken by a
maintenance crew to determine the cause of the problem.
It is important to note that the forced landing was not related to engine
start-up problems, which we talked about yesterday.
Senator Forrestall: Honourable senators, surely when a Sea King
helicopter lands near a golf course a mile and a quarter away from the base,
the pilot did not land under "full control."
Senator Lynch-Staunton: Maybe the Prime Minister was on board!
Senator Forrestall: Yes, perhaps that was the case. That
landing yesterday was serious. I know the minister takes this matter very
seriously. I just wish he had some clout at the cabinet table. Yesterday, that
plane was not under "full control." That crew was very fortunate to
land on the ground, and not in the ocean.
If the minister could obtain for us a list of occasions on which Sea Kings were
forced to land in circumstances similar to this recent incident, I would
appreciate it very much.
Senator Graham: Honourable senators, I would be happy to bring
forward the information if it is appropriate and available. As my honourable
friend would know after our many discussions, the government remains committed
to ensuring that the Canadian Forces have the equipment that they need to carry
out their missions at home and abroad.
Senator Forrestall: Where are the dollars and cents to buy it?
Senator Graham: The maritime helicopter project is a core
project within the Department of National Defence. At this particular time, the
minister and his officials are in the final stages of the development of a
As we have said on many occasions, we want to move on with the replacement
project for the Sea King helicopters as quickly as we can. The minister hopes
to make an announcement within the year.
Lack of Long-Term Debt Reduction
Hon. Donald H. Oliver: Honourable senators, my question is
for the Leader of the Government in the Senate. This concerns the government's
debt reduction strategy - or rather, the lack of one.
The government has again failed to set out any kind of meaningful, long-term
debt reduction strategy. There are no targets and there is no long-term plan.
Today, among the G-7 countries, only Italy has a higher level of debt relative
to GDP. Approximately two years from now, according to the budget, our debt
will be down to 55 per cent of GDP. Before government senators applaud too
loudly, they should reflect upon the fact that Canada will still have the
second-highest level of debt in the G-7.
Why does the government continue to refuse to set any kind of long-term debt
Hon. B. Alasdair Graham (Leader of the Government): Honourable
senators, the Honourable Senator Oliver is totally and completely inaccurate.
Senator Oliver: What are the targets, then?
Senator Graham: The government does have a long-term plan. It
is called "the debt repayment plan." I urge Senator Oliver to check
the facts before he makes such assertions.
The debt repayment plan was announced in the last budget. The government is
already committed to reducing the debt.
Senator Murray: What is "long term"? Is it two years?
Senator Graham: Honourable senators, there are three key
elements in the plan: First, there is the two-year fiscal plan, based on
prudent economic planning assumptions.
Senator Murray: That is long term!
Senator Graham: Second, there is the inclusion in the fiscal
plan of a contingency reserve in each year, and third, the use of the
contingency reserve, when not needed, to pay down the public debt. The plan has
already been a success. In 1997-98, the government reduced federal public debt
by $3.5 billion. I would invite the Honourable Senator Oliver and other
honourable senators opposite to tell us when, during the period that they were
in office, they reduced the debt.
Senator Lynch-Staunton: Tell us when that wizard Allan
MacEachen did it!
Senator Graham: As a result, in 1997-98, Canada's debt-to-GDP
ratio - listen carefully - recorded the largest yearly decline since 1956-57,
falling from 70.3 per cent to 66.9 per cent. More important, the debt repayment
plan, and I urge my honourable friend Senator Oliver to read it carefully,
together with sustained economic growth, will result in a sharp, sustained
decline in the debt-to-GDP ratio in the coming years.
This country is on the right track under this particular government.
The Budget 1999
The Budget Plan-Allocation of
Funds to Interest on Debt
Hon. Lowell Murray: Honourable senators, by way of a
supplementary question, may I ask the Leader of the Government to read into the
record the amounts that are forecast to be paid by the government by way of
interest on the debt over the next several years? He will find them in the
document entitled "The Budget Plan."
Hon. B. Alasdair Graham (Leader of the Government): Honourable
senators, I would be happy to do that. However, if the honourable senator has
his finger on the page, perhaps he could do it for me.
Senator Murray: It is going up.
Privy Council Office
Prime Minister-Request for
Details on Recent Vacation at Whistler, British Columbia
Hon. Terry Stratton: Honourable senators, my question is
also for the Leader of the Government in the Senate. I would like to go back to
Vancouver and Whistler, if I may, on that infamous weekend when our beloved
Prime Minister failed to take the trip to the funeral of King Hussein.
What kind of aircraft was used for the trip to Whistler? Was it a government
aircraft? Who was on that aircraft, to and from, and who paid for the expense
of the aircraft?
Hon. B. Alasdair Graham (Leader of the Government): Honourable
senators, I do not have the list of the passengers with me.
Senator Di Nino: Would you like to borrow mine?
Senator Graham: I believe that is the kind of question that
should be placed on the Order Paper. However, I would be very happy to bring
forward the information for the honourable senator, as he always brings forward
such interesting questions.
Bill to Amend-Third Reading
On the Order:
Resuming debate on the motion of the Honourable Senator Kroft, seconded by the
Honourable Senator Moore, for the third reading of Bill C-59, to amend the
Insurance Companies Act.
Hon. John Lynch-Staunton (Leader of the Opposition): Honourable
senators, when this bill on demutualization was being discussed before the
Standing Senate Committee on Banking, Trade, and Commerce, some concern was
expressed on both sides regarding the tax treatment which would be given to
those eligible policyholders receiving cash or shares.
Cash, according to the federal government, will be treated as a dividend. If
the shares are disposed of, a capital gains tax would be imposed, and the cost
of the shares is being deemed to be zero. I will not get into the arguments of
the pros or cons of that decision, but we were concerned about the possibility
that many eligible policyholders would not be aware of the tax consequences,
particularly those of low income and those who have income-tested benefits. The
latter category may find that, because of the sale of the shares or the receipt
of dividends, they may lose or have some of those income-tested benefits
The officials responsible assured us that, in the regulations, there was a
provision that the information given to policyholders would include the tax
consequences not only in this country but in each jurisdiction the policyholder
happens to be in. However, the regulations also provide that the Superintendent
of Financial Institutions can, at his own discretion, exempt a life insurance
company from providing certain information, including tax consequences.
When what appeared to be a contradiction in the regulations was pointed out to
the officials, we were assured that where there was a large number of
policyholders, those exemptions would not be applied. Particularly in the
United States, and the United Kingdom, all policyholders would be informed of
the tax consequences by the life companies, and, I believe, in Canada by the
In the letter from the Superintendent of Financial Institutions that Senator
Kroft tabled yesterday, some of the answers to the questions that were asked in
the committee were given, but that assurance that the exemptions on information
regarding tax consequences would not be applied to Canadian policyholders was
With the knowledge of Senator Kirby and Senator Kroft, and members on the
committee on our side, I got in touch with Mr. Palmer, the Superintendent. He
replied in a letter which I distributed to the members of the committee,
certainly to Senator Kroft and Senator Kirby, which includes an assurance
that, in effect, the information on the tax consequences for Canadian
policyholders will be an obligation of the Canadian life companies.
Senator Di Nino: Well done!
Senator Lynch-Staunton: Perhaps I should read the pertinent
part of the letter.
I can assure you that this exemption authority would be used only in respect of
jurisdictions in which the converting company had only a minor presence, and in
which this additional disclosure would add very little value to policyholders
in that jurisdiction.
With the permission of the Senate, I should like to table this letter to
complement the one that Senator Kroft tabled yesterday.
The Hon. the Speaker: Is leave granted, honourable senators, to
table the letter?
Hon. Senators: Agreed.
Senator Lynch-Staunton: Honourable senators, as you know, this
bill was sped through the House of Commons in record time, with no debate
whatsoever in the House of Commons.
Senator Kinsella: How long did they spend on it?
Senator Lynch-Staunton: I did make a mistake in referring to
that during the second reading debate. I said there were no committee hearings
in the House. I was wrong. Looking back, I found that the Standing Committee on
Finance of the House of Commons technically held a hearing. However, when you
read the transcript, it was more of a love-in. There was very little debate on
some of the key issues that were brought out by our Banking Committee at
meetings with the minister responsible, with life insurance company executives,
with officials of the Department of Finance and the Superintendent of Financial
Institutions, and with some consumer groups. The House of Commons neglected to
involve the key players in order to get a better understanding both of the
purpose of the bill and its impact on policyholders.
I will read one part of the transcript of the House committee hearings to
stress their flavour. This is of particular interest to this house because the
person I am quoting is the other member of that dynamic duo, Lorne Nystrom, who
is the member for Regina-Qu'Appelle and who is going across the country with
his friend wasting taxpayers' dollars seeking petitions to abolish all of us.
Here is what he said regarding hearings on Bill C-59:
I think it's important for us to ask questions and get them on the record. I
wouldn't want the other place, as we call it, the Senate, to be the only body
to have a chance to go over this thing in detail in terms of asking questions.
The purpose of their hearing was to show that they had at least pro forma gone
through the exercise of examining the bill. He went on to say:
They're the unelected house. It's important, I think, for us to do this. It's
too bad we have the time constraint. I know the minister himself is concerned
about this thing because we have the adjournment of the House on Thursday
staring us in the face.
It is quite obvious that the House of Commons, from the beginning, had no
interest in examining this bill as thoroughly as it should have been.
Fortunately the Senate was there to do that. The fact that Mr. Nystrom, who
does not like us, would say words to the effect, "Well, we better do
something here because the Senate may find they have to do all our work,"
confirms the importance of the work we do here.
Hon. Senators: Hear, hear!
The Hon. the Speaker: If no other honourable senator wishes to
speak, I will proceed with the third reading motion. It was moved by the
Honourable Senator Kroft, seconded by the Honourable Senator Moore, that this
bill be read a third time. Is it your pleasure, honourable senators, to adopt
Motion agreed to and bill read third time and passed.
Bill to Amend-Motion to Concur
with Message from Commons-Report of Committee Adopted
On the Order:
Resuming debate on the motion of the Honourable Senator Tkachuk, seconded by
the Honourable Senator Cohen, for the adoption of the Twenty-first Report of
the Standing Senate Committee on Banking, Trade and Commerce (motion and
message relating to the amendments to Bill C-20, to amend the Competition Act
and to make consequential and related amendments to other Acts), presented in
the Senate on February 16, 1999.
Hon. John Lynch-Staunton (Leader of the Opposition): Honourable
senators will recall that after this bill was amended and returned to the House
of Commons without a dissenting vote, the Minister of Industry issued a press
release full of errors and innuendo. I will not go into all of the details
because I feel I gave you enough to realize what I am talking about at the time
that this message was first before us.
I do not intend to belabour this matter. However, I do feel that colleagues
should know that, despite being asked repeatedly during the committee hearings
on this message to withdraw, or at least recognize, the falsehoods that were
sent under his name, the minister not only continued to whine about the delays
encountered in the Senate but continued to cast doubt on the purpose behind
them. I find this extraordinarily strange because if this bill is such a
priority for the minister, why did it languish in the House for nearly 10
The bill was given first reading there on November 20, 1997, second reading
only four months later and third reading over six months later. We were
criticized for having delayed the bill after having had it before us here for
less than three months, and thanks to Senator Oliver's amendment, following
representations by the Canadian Bar Association and others which actually
While the House rejected the Senate amendment, the government used the Senate's
participation to introduce another amendment, quite different from its original
one, and one which goes a long way in meeting the concerns expressed in
committee and in this chamber.
I was not successful at getting a straight answer from the minister. However, I
wish to thank Senator Kenny for having done that very thing. I will quote from
the transcript of the committee hearings. Senator Kenny says:
Would you say, Mr. Minister, that the amendment that came back from the Senate
gave you an opportunity to improve the bill?
Mr. Manley: Without any question.
Hon. Senators: Hear, hear!
Senator Lynch-Staunton: Honourable senators, I rest my case.
The Hon. the Speaker: If no other honourable senator wishes to
speak, I will proceed with the motion.
Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
Motion agreed to and report adopted.
Consideration of Interim Report
of Special Committee-Debate Adjourned
The Senate proceeded to consideration of the first report (Interim) of the
Special Senate Committee on Transportation Safety and Security, deposited with
the Clerk of the Senate on January 28, 1999.-(Honourable Senator Forrestall
Hon. J. Michael Forrestall: Honourable senators, it is a great
honour for me to rise today to begin the debate on the interim report of the
Special Senate Committee on Transportation Safety and Security. I have been
privileged to chair this special committee and, as well, I had the privilege of
chairing the subcommittee of the full committee on transport and
communications, its subcommittee on this topic.
None of us here are immune from attacks by the press and from some members of
the House of Commons. The attacks are, by and large, from people who do not
understand the Senate, what it does and how it works. To that end, I should
like to commend the intervention by Senator Rompkey yesterday, during which he
outlined very succinctly and clearly the good work being done by the members of
One of the great benefits of an appointed upper chamber like ours is that on
certain issues we can put party politics behind us and pursue matters of
national interest in a bipartisan manner. I know, and I know that my colleagues
do not take it for granted, that members of the opposition do chair standing
committees. In my case, and as I mentioned, I chaired a subcommittee, the
standing committee of which was ably chaired by Senator Bacon, who was a very
active member of the Subcommittee on Transportation Safety with a particular
interest in drugs and other abusive substances. It is one of the great
strengths of this place - and I say this with a little bit of knowledge and
authority, having sat for a considerable time now in both places - that the
interests of members can be accommodated in a non-partisan manner.
The idea of a Senate committee on transportation safety originated a few years
ago with Senator Keith Davey, one of our former colleagues, a very
distinguished Canadian. At the time, his preoccupation was with the safety of
truck transport, and he wished to see a special study undertaken in this area.
His idea was prescient, since we are now fully aware of the dangers of having
far too many unsafe trucks on our highways. Unfortunately, Senator Davey
resigned from this place before his idea of a truck transportation safety
committee could come to fruition.
I was struck by the validity of Senator Davey's idea when it was first raised
in the early part of this decade, and pursued it with Senator Bacon. She was
receptive to the idea but was concerned that such a study would be too narrowly
focused, and perhaps focused in an area which was predominantly within
provincial jurisdiction. The solution was, therefore, to study all modes of
transportation, and the vehicle for doing this would be a subcommittee of the
Standing Senate Committee on Transport and Communications. Such a subcommittee
was struck in October of 1996. It was composed of Senator Willie Adams, deputy
chair, Senator Lise Bacon, Senator Mercier, Senator Roberge and myself as
I can say without any shadow of a doubt that we worked hard, but it was only
after we got into the study that we realized the enormity of the task we had
undertaken. Not only was it an enormous job to study safety in the various
transportation modes of rail, air, marine and highway transport, but of course
we were all amateurs in these areas. However, we persevered, and slowly but
surely built up a bank of information on the major safety issues affecting the
modes of transport within Canada. During our travels, both throughout Canada
and abroad, attending seminars, workshops, international conferences on safety,
hearing from literally hundreds of people involved in the transportation
industry around the world, we were able to identify issues and, in some cases,
solutions to address problems in the transportation industry facing us here in
I look upon the work of the subcommittee as one of fact-finding and issue
development. In the early spring of last year we realized that, given the
enormity of the subject-matter to be studied and reported on, and the heavy
workload of the Standing Senate Committee on Transport and Communications, it
would be a better use of the time of the Senate if a special Senate committee
on transportation safety and security were established. This was accomplished
on June 18, 1998, and all of the work that had previously been done by the
subcommittee was referred to the new special committee. We began our work with
a view to writing the report that is now before the Senate for deliberation.
I wish to provide you with an overview of the work of the subcommittee and the
special committee, their conclusions and recommendations. I trust colleagues on
both sides of the chamber will deal in greater detail with the specific modes
of transportation covered within the report.
Our overall purpose in this exercise is to create in Canada, among all
Canadians, a culture of safety. We believe that by raising the profile of
transportation safety through our discussions with industry, unions, consumers
and transportation associations, we can raise the profile of safe transport in
Honourable senators, the idea of a culture of safety came about because I am
and continue to be worried about the state of transportation safety in Canada.
When you look at rail, marine, air and highway transport, has any industry
changed as much in Canada as transportation? Has the work force been downsized
in any other area of our lives more than in transportation?
We have gone through deregulation, privatization, transfer of ownership of
transportation facilities to the private sector, and ever increasing
competition. That is just to name a few of the changes that we have asked this
industry to undertake. At the same time, more people are travelling and more
goods are being shipped in and out of Canada by more modes than ever before.
Honourable senators, given these and other stresses posed on all facets of the
transportation industry, I believe, and I know that most of our witnesses would
agree, that we must make every possible effort to ensure greater safety.
One of the major recommendations of the committee, and the one that got the
most publicity, dealt with random mandatory drug testing to be adopted in
Canada in a manner similar to the testing program in the United States. Senator
Bacon pursued this issue with great vigour with virtually all of the witnesses
who appeared before us.
We heard from Ms Barbara Butler, for example, a well-known Canadian and
international expert in this field. She assured us that drug and alcohol abuse
was an issue in the transportation industry in Canada. We were pleased that a
number of transportation companies have instituted some type of testing
program. In the case of the Irving Transportation Group, they have instituted
random mandatory testing for all employees.
The witness from Irving set out the matter of concern relating to drug and
alcohol testing. The law in the United States which requires all those in
safety sensitive positions to submit to random mandatory testing may be
challenged as not being applicable to Canadians driving trains or transport
trucks in the United States. If the courts found that it was not to be applied
to Canadians, it might mean that Canadian transportation companies may be
effectively prohibited from doing business in the United States, a situation
which would be intolerable.
One of the most compelling arguments in favour of random mandatory drug testing
came from Maurice Engles, the former chair of the Railway Safety Act Review
Committee. He told us:
Automobile drivers in practically every province in this country are now being
tested on a random basis. If indeed it is considered to be of concern that one
of these drivers should be on the road, how can we say that a locomotive
engineer should not be subject to such testing, when you consider the
responsibilities that person would have?
We hope the government will reconsider its position on random but mandatory
testing and institute it at the earliest possible time.
During our hearings both in Canada and abroad we came to have even more respect
for our Transportation Safety Board than we had when we began this process.
However, we are concerned that this vital part of our transportation safety
system is overworked, understaffed and under-resourced. It is our opinion that
the government should build upon the good work that the board has done and
expand its mandate in order to give it the resources it needs to continue to
perform its work at the high level of competence we now experience.
We were told by Mr. Ken Johnson, the executive director of the board, that they
are reassessing their needs after the work they have done in relation to the
Swissair tragedy. In this reassessment, I hope the board, along with
government, will look at expanding its mandate to include major truck-transport
highway accidents as well as making the board responsible for the
establishment and operation of victims' family assistance programs.
Canadians have every right to be proud of the work of the board and the
international stature it enjoys.
I should like to touch briefly on safety issues affecting rail and marine
transport before I deal in more depth with the air and highway sectors.
Two recent reports from the Transportation Safety Board highlight safety
problems in the rail industry. The board's investigation in the Biggar,
Saskatchewan VIA Rail derailment and the Edson, Alberta accident revealed
deficiencies in safety procedures, the application of safety procedures and
general attitudes toward safety.
Evidence before our committee concentrated on the management and union problems
in the rail industry which some of us believe are severe enough to be
detrimental to safety. Bill C-58, currently before the Senate, seeks to amend
the Railway Safety Act. We must look at further amendments to this act as our
With regard to marine transportation, the main safety problem comes from
recreational boating. Over 200 people die each year in these types of boating
accidents. I congratulate the government for bringing in regulations that will
impose minimum age limits on the operation of certain types of boats. The
committee will continue to monitor the effect of these measures as we continue
We are also concerned about the ageing work force in our marine industry. Many
reputable witnesses appearing before us at our hearings in Halifax expressed
grave concerns that young Canadian men and women are not being attracted in the
numbers they should be to a life and career at sea. The reasons for this
include a lack of tax inducements, opportunity, and access to educational
institutions concentrating on marine life.
Turning to highway transportation safety, there are three fundamental points
that must be made. First, massive amounts of money must be directed by all
levels of government into a coherent program of highway building, repair and
maintenance. The CAA suggested to us and we made it a recommendation that a
portion of the excise tax on gasoline be directed toward highway projects. In
our final report on this matter, we will set forth a formula that we believe is
equitable and fair.
Second, we must do something about truck-transport safety. There are too many
trucks carrying larger and longer loads, paying more attention to the corporate
bottom line than to safety. The Province of Ontario began to address this
problem with stiff fines for unsafe vehicles and roadside spot checks. We
commend them for their efforts. This is an area where the federal and
provincial ministers of transport must take the lead and crack town on unsafe
Third, Canada needs an enforceable national safety code. Agreement was almost
reached a few years ago on such a code. We need to try again. Such a code would
regulate the size of trucks across the country and set out minimum standards of
safety that could be enforced.
These three initiatives are overdue. If they are accomplished, literally
hundreds of lives will be saved annually.
Finally, I wish to touch on the subject of air safety. This area is a priority
for the special committee. We have begun our hearings in this area and hope to
report with respect to this issue before our summer break. We will then hold
intensive hearings on the various other modes, issuing reports with a view to
winding up our work by early next year.
Our study of air safety and security will give us the opportunity to reflect on
Canada's role in air safety throughout the world as well as at home. In other
words, air travel in Canada for Canadians is pretty safe, but it is not enough
that it be safe within Canada. Canadians should be able to travel the globe and
feel safe knowing that they are flying through systems that meet Canadian
We discussed this international aspect of air safety with various witnesses
when we held hearings in the United States and Europe. The Second World
Conference on International Safety, held at the Technical University in Delft,
Netherlands, concentrated on the global aspects of air safety.
We are fortunate in Canada in relation to air safety, and we should explore the
export of our knowledge and expertise to the developing countries of the world.
The special committee will spend much of its time in the coming year studying
the future of transportation safety. We view it at as our role to recommend
procedures that will point towards safer travel in the first 10 to 15 years of
the next century.
In conclusion, I want to invite senators opposite who are interested in
transportation safety and security to join in our work. Because of conflicts
and time restraints, we had difficulty filling a number of spots on the special
committee. As I said earlier, we can promise you lots of interesting, sometimes
fascinating, work, most of it indoors and out of the cold. I remind you that
we do not scrub floors, windows, or ceilings! If you have free time and you
note that the committee is meeting, please join us.
Honourable senators, I look forward to returning with other segments of our
final report at a future date.
On motion of Senator Forrestall, on behalf of Senator Spivak, debate adjourned.
The Estimates, 1998-99
Retention and Compensation Issues
in the Public Service-Report of National Finance Committee Tabled
Leave having been given to revert to Presentation of Reports from Standing
or Special Committees:
Hon. Terry Stratton: Honourable senators, I have the honour to
table the ninth report of the Standing Senate Committee on National Finance
concerning retention and compensation issues in the public service.
Bill to Amend-Consideration of
Report of Committee-Debate Adjourned
The Senate proceeded to consideration of the fifteenth report of the
Standing Senate Committee on Social Affairs, Science and Technology (Bill S-10,
to amend the Excise Tax Act, with an amendment) presented in the Senate on
December 9, 1998.-(Honourable Senator Murray, P.C.)
Hon. Lowell Murray: Honourable senators, with this report, the
Standing Senate Committee on Social Affairs, Science and Technology returns
Bill S-10 with one amendment. Bill S-10, which had been sponsored by Senator Di
Nino and received second reading in this place before Christmas, is a bill to
remove the GST on reading materials. Bill S-10 amends the Excise Tax Act.
For at least two reasons, it is the happiest of coincidences that this report
should be before you today. First, we are only a couple of days removed from
the budget presented by the Minister of Finance, Mr. Martin. From that budget,
it is clear that the nation's finances are in pretty good shape. Indeed, the
finances are well able to support the relatively modest costs that would be
imposed on the Treasury by Senator Di Nino's bill. To remove the GST from
reading materials is not a big-ticket item in terms of the federal fiscal
scene, but as honourable senators know very well, it is a significant matter
for many Canadians.
That brings me to the second reason that having this report before you today is
such a happy coincidence. Today, as we were reminded earlier, is Literacy
Action Day in this country. We heard eloquent speeches from our friend Senator
Fairbairn, from Senator DeWare and from Senator Cochrane on just that subject.
Let me single out Senator Fairbairn for special attention. Senator Fairbairn
led the charge in 1990 when the GST was going through this chamber to remove
the GST on reading materials.
Senator Oliver: I remember!
Hon. Senators: Hear, hear!
Senator Murray: Senator Fairbairn has been the leading champion
in this chamber in Parliament and in the government, and certainly one of the
leading champions in the country, of literacy and of a coordinated attack on
the illiteracy problem. She knows more about it than anyone. She appreciates
more than anyone does the importance of a measure such as that proposed by
Senator Di Nino to remove the GST from reading materials.
Before Senator Fairbairn gets up to remind me of the fact that I voted against
her amendment when it was going through this house, I will acknowledge that
right away. I was bringing the GST through the house and it was the position of
the government of the day that there ought not to be exemptions or exceptions
and that there were other ways to pursue such policies as the attack on
We are now, however, faced with a different principle. My honourable friend was
able to persuade the Liberal Party and, in particular, Mr. Chrétien to
adopt that policy. What we are dealing with today is a solemn commitment made
by the Right Honourable the Prime Minister in the course of an election
campaign to remove the GST from reading materials. That commitment on behalf of
the Liberal Party, which now forms the government, was made without evasion,
without equivocation, without reservation whatsoever.
And so honourable senators on both sides of this house have an opportunity,
and, I think, a responsibility in the case of our friends opposite, to redeem
that solemn commitment made by none other than the Right Honourable the Prime
Senator Kinsella: Stick to your principles!
Senator Murray: Honourable senators, at the Standing Senate
Committee on Social Affairs, Science and Technology, there was a very
commendable bipartisanship as among Liberal and Conservative senators. I want
to acknowledge that today.
Senator Roche: And independents, too!
Senator Murray: An independent senator also took part in our
deliberations, and I am happy to be reminded of that fact by Senator Roche.
We passed one of the amendments that was before us, the effect of which is to
maintain the GST on any material that contains an age restriction imposed by
law on its sale, purchase or viewing or is either obscene within the meaning of
section 163 of the Criminal Code or of a pornographic nature.
Those amendments were passed by the committee and are before you today in this
report. As I say, there was a most commendable bipartisanship in the committee
on this important bill of Senator Di Nino's. I urge all colleagues to carry
that spirit of bipartisanship over into this debate, to adopt this report, to
send this bill for third reading, passage and transmittal to the House of
Commons with all possible speed.
Hon. Sharon Carstairs (Deputy Leader of the Government): Would
the honourable senator accept a question?
Senator Murray: Certainly.
Senator Carstairs: Honourable senators, three amendments were
sent to the committee. I understand that only one has been returned. Could my
friend give us a brief explanation as to why the other two amendments were
Senator Murray: I am not in a position to do that from memory,
honourable senators, but I happen to know that our friend Senator Di Nino, who
is the sponsor of the bill, intends to take part in the debate on the report.
Perhaps he or one of our other colleagues would care to deal with those other
amendments. I do not even have them in front of me at the moment. I only have
the report and the amendment that we are recommending to the Senate.
Hon. Consiglio Di Nino: Honourable senators, if I may, I should
like to address the question of the Deputy Leader of the Government.
The amendment was actually in three parts, not three amendments, if I remember
correctly. The first part dealt with the age restriction, as Senator Murray has
just mentioned. The second part dealt with the issue of pornography. The third
part, which the committee did not accept, stated that any publication,
magazine or newspaper that contained 5 per cent or more advertising should also
not be included in the bill and, in effect, should continue to carry the GST.
A number of senators on both sides spoke eloquently on all of the amendments.
As Senator Murray said, it was a wonderful, bipartisan effort. However, what
carried the day for removing the third part of their amendment was the fact
that hundreds, if not thousands, of publications across this country - small
publications, magazines and newspapers, including third-language newspapers -
would have been hurt by accepting this amendment. Hence, the committee saw fit
to take that particular part of the suggested amendment by Senator Maheu and
Senator Ferretti Barth. I trust that is the answer the honourable senator was
Honourable senators, I should like to add a few words to the eloquent
presentation made by Senator Murray. He has given us some good background to
consider and a lot of food for thought before we proceed to third reading of
this bill. As well, it is quite opportune that today, Literacy Action Day, we
are dealing with this bill in the Senate.
As I began to say yesterday, this has been a long journey. It started in 1990
with Senator Fairbairn and a number of other colleagues opposite who saw the
wisdom of the need to remove the GST from reading material. As Senator Murray
said, one can point to us and say, "You did not accept our amendment at
that time," but I will not go into the political reasons for that.
However, we must remind ourselves that the Conservative government in power at
that time did state that this would be one of the first issues they would deal
with at the earliest possible opportunity. Commitments were made to take a look
at removing the GST from reading material.
It is unfortunate that the Finance Minister in his budget did not take the
opportunity to do something about tax on reading material. He obviously chose
not to keep this government's promise to Canadians, a promise made by the Prime
Minister and others. Removing the GST would have cost very little money in
relative terms. More important, it would have sent a message to Canadians that
we take the issue of literacy seriously in this country.
That aside, honourable senators, this has been a learning experience. I should
like to thank my colleagues on both sides for their support and, frankly, for
some of the very wise debate that took place both in the chamber and in
committee on the issue of GST on reading material.
The committee heard testimony from a wide range of individuals. All of them
agree with the principles of this bill, even my colleagues opposite. Not a
single witness had anything negative to say about this bill. The finance people
expressed some reservation, principally dealing with costs, which obviously
should no longer be the concern it was at that time.
Each witness had something interesting to tell us. Roch Carrier, the renowned
Canadian author and former director of the Canada Arts Council, reminded us
about the importance of making reading material as accessible as possible so we
can start our children reading at an early age. He said:
Kids should enjoy the privilege of reading.
Later he said:
It is the best start to a good life.
Gailmarie Anderson, who owns the Melfort Bookshop in the small farming
community of Melfort, Saskatchewan, spoke about the impact of the GST on her
business. She said:
Every day...I see parents who buy one book rather than two books for their
children because of the added expense. In a small book store, the GST makes it
more of a struggle to survive and makes it more difficult for Canadians, as
individual consumers, to have books.
Incidentally, Ms Anderson wrote me following her appearance. In her letter, she
referred to a single mother in Melfort who, because of her financial situation,
is forced to purchase books for her children on a lay-away plan. This is 1999
we are talking about.
Senator Oliver: Shameful!
Senator Di Nino: Another of our wonderful witnesses was Sonja
Smits, one of Canada's best actors and a director of the organization
Performers for Literacy. She gave the committee some sobering statistics. She
reminded us that "42 per cent of Canadians are below minimum literacy
standards" and that "an additional 34 per cent can only use simple
reading materials." She went on to say:
People with low literacy are three times more likely to be unemployed.
Once again, honourable senators, I remind you that we are talking about 1999.
Just as an aside, a while back I received, as did we all, a letter from Canada
Post concerning the corporation's Freedom of Literacy Awards. That letter noted
Poor literacy skills cost the Canadian economy approximately $4 billion in lost
productivity each year.
Another one of our witnesses, Jocelyn Charron, Government Affairs Coordinator
of the Canadian Federation of Students, spoke about the impact of the GST on
today's college students. He noted that:
Post-secondary students have been seriously affected by the introduction of the
Further on, he adds:
The GST affects what students can buy.
I quote again:
Students will have to do without one or more of the texts required because of
Honourable senators, perhaps the best and most eloquent testimony was heard
from Peter Gzowski, who obviously needs no introduction. Mr. Gzowski mentioned
two things that I believe bear repeating. The first was that "literary is,
or ought to be, a civil right" in our country.
Mr. Gzowski also mentioned that removing the GST on reading material would have
the symbolic value of recognizing the importance of reading and writing in our
lives, and the practical effect of making the tools of training and
re-education more accessible to the people who need them.
Other points emphasized during committee hearings were that literacy makes
economic sense, taxation discourages consumption, education is not the only
answer to literacy, and helping our children to learn to read is one of the
most important things we, as parents, can do.
My conclusion from the different testimony heard before the committee is that
this is not only a question of money, it is also a question of values. It is a
question of what kind of a society we want and should have in Canada. We are
entering an era in which the ability to read is becoming more crucial than it
ever was. Those who cannot read, or those who read poorly, will be left
behind. They will become part of the have-nots.
The government, through the Department of Finance, has argued that we should
not fiddle with the GST; it is there, and we should live with it. The
department has asked where the replacement revenue will come from, and stated
that the programs already in place are a better solution to the issue of
literacy than removing the GST. We know where the replacement money can come
from, and we certainly know that there are better solutions. The best one is to
remove the GST on reading material.
Argument and debate aside, it all boils down to one main thing: promises. I
refer to promises made by members of this chamber on both sides; promises made
by members of the present government, both before and after 1993; promises made
by the Liberal Party membership; and promises made by members of the
Conservative Party. Honourable senators, we all promised Canadians that we
would get rid of this tax. We have an obligation to keep that promise.
Another thing about which witnesses reminded us is that getting rid of the GST
on reading material is the right thing to do. I wish to take a moment to bring
to your attention two points. The first is a comment made by a Liberal member
of the other place, Mr. Peter Adams, who said:
Books, newspapers and magazines are instruments of freedom.
The second point is that a number of Canadians from coast to coast were
visiting members of Parliament yesterday and today as part of Literacy Action
Day. I was extremely touched this morning by the words of a middle-aged
gentleman who, like myself, immigrated to this country when he was a young
teenager. He came from South America. He told me that a couple of weeks ago,
his 6-year-old daughter returned home from grade one with a book. Her teacher
had told the students that if their parents read from this book, the students
would receive some form of recognition, I believe it was to be by way of stars,
or something of that nature. Tears came into the gentleman's eyes and he said,
"I have never felt so ashamed in my life. I could not read my 6-year-old
daughter's book." He is now enrolled full-time in a school supported by
the literacy movement.
Honourable senators, I close by urging each and every one of you to send a
message to the other place but, most important, to send a message to Canadians
that we care about literacy and about the promises we have made. At the
appropriate time, I hope you will support the passage of Bill S-10.
On motion of Senator Carstairs, debate adjourned.
Hon. Sharon Carstairs (Deputy Leader of the Government):
Honourrable senators, there is an agreement that at 3:30 we will move into
Committee of the Whole.
The Hon. the Speaker: Is it agreed, honourable senators, that
we now move to Committee of the Whole?
Hon. Senators: Agreed.
Annual Report-Consideration in
Committee of the Whole
The Senate in Committee of the Whole on the Report of the Privacy
Commissioner for the period ended March 31, 1998, tabled in the Senate on
September 29, 1998.
The Senate was accordingly adjourned during pleasure and put into Committee of
the Whole, the Honourable Fernand Robichaud in the Chair.
Senator Carstairs: Honourable senators, I move, seconded
by the Honourable Senator Kinsella, that Mr. Bruce Phillips, Privacy
Commissioner, be escorted to a seat in the chamber.
Senator Kinsella: Honourable senators, while Mr. Phillips is
being escorted to the witness table, I believe there is agreement that
honourable senators who are sitting in seats at an extreme distance from the
witness table may take vacant seats that are closer to the witness, and that
the rules be waived in regard to where one must be seated whilst asking a
question in Committee of the Whole.
The Chairman: Is there unanimous consent for the suggestion
made by Senator Carstairs that senators be allowed to speak from a seat other
than their own during these deliberations?
Hon. Senators: Agreed.
Pursuant to order adopted October 29, 1998, Mr. Bruce Phillips was escorted to
a seat in the Senate chamber.
The Chairman: I welcome Mr. Phillips, Privacy Commissioner, and
Mr. Julien Delisle, who is with him.
Mr. Bruce Phillips, Privacy Commissioner of Canada: My address
will be as brief as I can possibly make it. I must start by saying that this is
quite a thrill. It is an extraordinary occasion for us. This is the first time
I have been called to appear before a Committee of the Whole of either house.
In my early days as a press gallery reporter here, about 40 years ago,
appearances of witnesses before committees of the whole house were quite
commonplace. It is now somewhat out of fashion, which is too bad. Whatever the
intention, the result has been reduced public visibility of the legislative
process and of the workings of government. When all or most of the departments
and agencies were before committees of the whole, for better or for worse, it
was always under the eye of the fourth estate. Even if it was only one lonely
wire service reporter - although there were usually quite a few of us - since
we had to sit there, we daily wrote thousands of words and scores of stories
about it. Now that it is spread across many committees, I think much of the
work goes unseen and unreported. Quite frankly, I think this contributes to the
disconnection between Parliament and the public.
Senator Prud'homme: Bring him into the Senate!
Mr. Phillips: I will confess to having fantasized about that
possibility once or twice. But for a stroke of fate or two, who knows, I might
have made it here on my own!
If today's session represents the beginning of a revival of the process of
Committee of the Whole, forgive me for attaching some special distinction to my
appearance. I hope this does become true - at least for that small band of
people who are known as officers of Parliament. That is, the half dozen or so
of us whose appointment alone in the entire federal establishment requires a
vote of approval by both Houses of Parliament and who answer to no ministry
whatsoever but only to Parliament and who make our reports directly to the
Speakers of both Houses.
Parliament has decided that some issues, values and interests are of such basic
importance in Canadian life that they need a champion who stands at arm's
length from the government and from the political debates of the day. Thus we
have, among others, the Auditor General, the Chief Electoral Officer, the
Commissioner of Official Languages, the Information Commissioner and, in my
case, the Privacy Commissioner. All of us, in our special areas, share a common
charge of working to preserve fairness, decency and honesty in public
administration in particular and, to the extent possible, in Canadian life
No one could ask for more in this life - and, believe me when I say this - than
the opportunity to represent values of that kind. Please allow me, while I am
on this subject, to record my thanks to the Senate for signifying its
confidence in my fitness to continue in this office by having approved an
extension of my term a while ago. In the time remaining to me, I hope to
promote closer ties and greater interest by Parliament in the work of my
office and similar offices. Also, I want to express some particular personal
pleasure in my appearance here today. Many of you on both sides of this house
are personal friends and acquaintances and former colleagues of mine. It is
good to see you again.
Having said all that, I wish to express my gratitude at having the great good
fortune, for the past eight years, to serve Parliament in an office that has
been incredibly fulfilling, challenging and exciting. As most of you know, my
term expires in about 15 months. This, therefore, might be my one and only
shot at a meeting of this kind. On that account, I should like to take a minute
or two to talk about the concept of privacy in the broad sense.
You often hear the phrase these days that "privacy is the issue of the
nineties." I think there is some truth in that statement. In any given
week, you only have to look at the daily papers or turn on the television to
see how frequentlythe subject of privacy is raised as an issue of contemporary
importance. I think it must also have been an issue of the 1890s, the 1790s and
the 1690s - in fact, just about as far back as you can go into the mists of
human history. "Privacy" is merely a convenient but altogether
inadequate word that we use to encompass a set of values and considerations
which touch almost every aspect of our lives, which have evolved over centuries
of human experience and which, in every age, have set the terms and conditions
of social interaction both between and among individuals and individuals and
Mr. Justice La Forest, who recently retired from the Supreme Court, described "privacy"
as the value "that is at the heart of liberty in the modern state."
That is a wise observation indeed. If you would assess the degree of freedom
that exists in any particular society, look first to the degree of private life
that its citizens can command and you find a striking correlation. I have only
to mention some of the oppressive totalitarian regimes, many of which are still
around and we have seen just in this century.
"Privacy," in short, is just another word for "freedom."
Without it, we do not have any personal autonomy, no liberty and darn little
dignity. The degree to which we honour and defend the right to a private life
is precisely the way we measure the respect that we give to each other as
individual and distinct human
beings. It follows that if we chip away at this edifice, we do it at our peril.
Enough chipping away and it all falls down. It is the chipping process that I
should like to talk about today.
Freedom does not always or even very often disappear in some cataclysmic
eruption. It slips away quietly, bit by bit - usually the victim of many
plausible and seductive propositions which society accepts out of either
indifference or ignorance. In my view, it is this process which stands, in our
time, as the greatest danger to the priceless right to a private life that we
There are privacy problems cropping up in all kinds of places these days. In
surveillance technology we are now under the eye of someone's camera almost
every waking hour, and in biological sciences such as drug testing, DNA
testing, and so on we are also experiencing privacy problems. We could
profitably discuss all of these things one at a time and at length. In fact,
before some of your committees we have discussed some of these matters already.
My remarks today should be considered mainly in the context of the problem that
arises from the application of computer and communications technology to the
massive amounts of personal information that is being gathered in by both the
corporate and governmental worlds. The problem here is to ensure that the
management of all this information complies with fair practices of the kind
that are embodied in the federal Privacy Act. This is not rocket science. It is
simply to ensure that people know the information about them is being
collected, and why; that it will not be used for purposes other than the reason
it was collected, without their consent; that it will be kept secure; and that
people have a right of access to it and to correct it. That is the whole story
about privacy in the information world. Often it is honoured not in the
observance but in the breach.
Based on my experience as a commissioner working with government departments, I
do not think there are a great many people who deliberately or maliciously
strive to erode people's privacy rights. It is more of an insidious process and
it often happens quite unknowingly.
Earlier, I mentioned indifference and ignorance, and I used those terms
advisedly. More than once it has been my experience that administrators have
embarked upon actions which, in the upshot, they have been surprised to be told
have offended good privacy practice. I can certainly supply examples. Most of
this activity is certainly benign in its objective but carries with it a cost
which, upon more careful examination, sometimes proves to be unacceptable.
Usually, if my office finds out about it, I can fix it, but not always.
This aspect of the privacy problem has been exacerbated by the onrush of
technology and its impact on the collection, use and disclosure of personal
information. Every enterprise, public and private, depends upon personal
information as one of its vital raw resources. This information, collected from
all of us, is usually given up freely because we recognize the beneficial uses
to which it will be put, but we do so on the assumption that it will not be
used for unrelated purposes or disclosed to other persons without our consent.
If you go to a doctor, you reveal your symptoms. If you go to the bank for a
loan, you must disclose your financial situation. If you go to an employer, you
must cite your qualifications. The world would crash to a halt without such
routine exchanges, but there is an element of trust involved in all of these
transactions, and modern technology, unless properly hedged about with
effective and legally enforceable restraints, can and sometimes does make a
shambles of any notion of trust.
What, then, is the state of the law, which I think is of particular interest
and relevance here? In a phrase, it is creaky and it is leaky. The federal
Privacy Act, for a start, is badly in need of an update. Too much is excluded
from its purview. The federal government, for example, engages in massive
informational exchanges with other governments and private-sector entities. An
essential precondition of all of those exchanges should be a requirement of
compliance with the established privacy norms, but most of those exchanges
occur unseen, without scrutiny, and certainly without the knowledge of the
people who, in most cases, were the originators of the information.
There are other offensive exemptions as well. Federal investigative bodies, for
example, are allowed to deny people access to their personal information, for
any information that is gathered in "the enforcement of any law of Canada
or a province." No such all-embracing exemption should ever be allowed
unless an injury to enforcement can be demonstrated.
The very definition of personal information needs updating to take account of
scientific advance, as, for example, with blood and tissue samples. Neither
does the act provide an adequate system controlling what I think is the most
dangerous potential misuse of government information holdings, which is in the
areas of data matching, data linkages and data mining. These problems must be
addressed if our national government is to stay abreast of technological change
and fulfil its commitment to protect the privacy of Canadians.
In the private sector, at the moment, it is just a question of sauve qui peut.
With the single exception of Quebec, where the commercial world is covered, it
is an informational jungle out there, and survival of the fittest applies.
Generally speaking, we have no right to know what information business holds
about us, how they got it, how they use it, whether it is accurate, and how
they will keep it. Some corporations increasingly regard client data as a
resource which they can own and mine, use or dispose of as they wish. The more
widely information is shared, the more likely it will be used to decide what
services you will be offered, what benefits you may receive, even what jobs you
might qualify for, all without your permission or consent or knowledge.
Equally dangerous is that these decisions may be based on faulty information,
and we do not even have the legal right to correct that. One graphic example of
that particular problem was revealed in a U.S. congressional study a few years
ago which said that credit reports, for example - and we are all in someone's
credit report somewhere - contain an average error rate of about 20 per cent.
Errors of that kind can have real-life consequences in terms of the denial of
credit, and denial, possibly, of employment opportunities and so forth.
I am very glad to report that, assuming the House of Commons passes it, you
will soon have a bill before you which will go a considerable distance toward
providing a remedy to the absence of legal privacy rights in the commercial
sector. That bill, Bill C-54, will provide for the extension of federal privacy
law, in the first instance, to the federally-regulated privacy sector, that is
banks, communications, telecommunications, transportation, and so on - all
massive holders and gatherers of information. The bill will also extend the law
to the balance of the business world in the provinces, if they do not, in their
own legislatures, provide equivalent protection within a three-year period.
This bill also provides an oversight mechanism involving my office. The bill is
not perfect - few are - but I presume it will be improved in the legislative
process. It is a long step forward and I support it. I presume I will be given
the opportunity to come before members of this chamber when you are considering
It is a regrettable fact that a specific right of privacy was excluded from the
Charter of Rights and Freedoms. That right is enshrined in the Universal
Declaration on Human Rights, the European Covenant on Human Rights, and similar
documents and covenants, and I believe it is even in the Quebec Charter of
Rights. It was included in the original drafts of the Canadian Charter when
they were first circulated to the provinces for discussion, and unhappily it
got lost in all the horse-trading that went on from the Charter's conception on
its journey through Parliament. The Supreme Court is slowly buttressing privacy
through jurisprudence, but they have a long way to go.
At a minimum, inclusion of a specific privacy right would have meant much more
rigorous examination of draft legislation for privacy implications, and it
would have given my act, the federal Privacy Act, a more solid underpinning. As
it is, the act enjoys no certain paramountcy, and its heart, the Code of Fair
Information Practices, which I rattled off to you earlier, is subject to any
other act of Parliament and can be easily circumvented by other departments.
Frankly, I think that anything as basic as privacy rights deserves a little
better than that. We need Parliament to be especially vigilant on this issue,
and I implore you to be especially tough and critical when you are asked to
judge the merits of propositions in which the fate of privacy is put in the
You have often heard from departmental officials, and you will hear it often in
the future, that their objective is "to strike the right balance"
between their wonderful program and that irritating obstacle known as privacy.
This is a very depressing litany to me - I hear it almost every day - when I
know that what they really mean, at least in the way that it translates to me,
is, "Let us just get rid of privacy so we can get on with the business."
Many more so-called balancing acts like that and there will be nothing left to
balance; it will all have been chipped away.
The question that must be asked when it comes to data linkages and data mining
and usage of that nature by government departments is the following: Can you
make this program without the further abridgement of civil and human rights? If
the answer is no, they should be sent back to the drawing board. I believe
that, in the great majority of cases, the answer can be yes, if sufficient
ingenuity and plain hard work are put into it, but in drafting programs, one of
our troubles is that bureaucrats, and businesses too, reach too quickly for the
cheap and easy solution, which is just to throw in some technology that will
mix up the data and give them an answer. Any proposition that involves the
trade-off of privacy rights for administrative convenience or efficiency
should, in my view, face the very toughest of uphill battles before the
legislatures of the land.
On the subject of parliamentary vigilance, there is one issue in particular
that I wish to raise, and I will then conclude. No doubt you have heard about
the proposal to create a medical information highway. This has been recommended
by a special advisory council appointed by the government, and the Minister of
Health has indicated his intention to proceed. What is involved here is a
national health data network which will link existing and planned provincial
and local networks. Putting health care information into electronic systems and
then linking those systems has serious privacy implications. We all want a more
efficient and effective health system but, given the fact that the raw
material is the highly sensitive, personal information, medical information, of
millions of Canadians, great care must be taken to ensure that no abuse is
possible. What is at stake here is all that people have come to expect from the
The advisory council has laid great stress in its reports on the privacy
dimensions that are involved, but it remains to be seen how well good
intentions are translated into good deeds. I urge you, I plead with you, on
that account to give this, when you get the opportunity, the most careful
study. Of course, I will be anxious to contribute the help of my office.
Honourable senators, that is a very quick skim over a small part of the privacy
landscape, but it is enough, I hope, to demonstrate that there is much here for
legislators to ponder. When you do so, you will be animated by a resolve to
ensure that efficient government is not achieved by the abridgement of
precious and hard-won rights. People have a right to control their own lives,
and that means the right to control their information. They are only seeking
after what Mr. Justice La Forest called the heart of freedom.
We are now ready to field your questions.
The Chairman: Mr. Phillips, I remind you that you have access
to translation services through your ear piece.
Senator Milne: Mr. Phillips, under your mandate, for how long
after a person has died is information about the individual held by a
government department or agency protected? Does a person's right to privacy
change at some time after he or she has died?
Mr. Phillips: Senator, the retention schedules for keeping
information are established by the public Archives of Canada. They vary a great
deal depending upon the kind of information involved. A few time limits are set
in the Privacy Act for certain kinds of law enforcement information, for
example. There are some kinds of information that the government is allowed to
exempt from disclosure for periods of 20 years.
I cannot give you a simple answer. In some cases, the retention periods are one
or two years, and in other cases it is longer.
In the case of the census, to which I think you may be referring, there is an
absolute prohibition on census data gathered beyond a certain date - I think it
is 1901 or 1911 - that will keep it from disclosure in perpetuity.
Senator Milne: Even though the federal Privacy Act states in
section 3 that information about an individual who has been dead for more than
20 years is not considered personal information for sections 7, 8, 19 and 26 of
the Access to Information Act, you are still saying that the census information
will be privileged forever?
In respect of the census information, in a letter dated January 11 of this year
from yourself to the Chief Statistician of Canada, you referred to certain
proposals to amend the Statistics Act to allow for the transfer of identifiable
census returns to the National Archives for archival and historical purposes.
Your opinion on this proposal was as follows:
It will come as no surprise to you that this Privacy Commissioner has not been
persuaded that it represents an acceptable balance between the preservation of
individuals' privacy rights and the interests of researchers and genealogists.
When you refer to the preservation of individuals' privacy rights, for how long
do you feel that the privacy right of an individual should be preserved, in
spite of the fact that your mandate says 20 years after death?
Mr. Phillips: Senator, census information is gathered by
Statistics Canada on a promise of confidentiality to the people who are
required to give it up under penalty of law. That is a compulsory collection of
information. We get, in my office, many complaints from people about the
intrusive nature of the questions I mentioned merely to testify to the
sensitivity of the information. It is not for me as Privacy Commissioner or, I
submit, for any other individual, to decide how much privacy the people who
give up that information in the expectation that it will be held confidential
and secret by Statistics Canada can be expected to give up.
In my view, dead people are just as entitled to an expectation of privacy in
those circumstances as anyone else. The notion that somehow or other our
departure from this earth means that all the personal information about us will
be open and exposed to anyone who wants to look at it thereafter is one that no
Privacy Commissioner could support. I understand the interest of genealogists
and others in this kind of information, but I simply make the case that there
are all kinds of data banks gathered by the Government of Canada which contain
a great deal of interesting personal information which I think might be of
equal interest. I do not see a special case for excusing the census. In fact,
I think the case for keeping that information confidential is stronger than it
is with most databases because of the sensitive nature of it.
To argue that simply because you are dead you have waived all your rights, in
my opinion, is not an acceptable proposition.
Senator Milne: Even though that is a proposition under which
you are mandated to operate?
Mr. Phillips: The Privacy Act also says elsewhere, senator,
that information shall not be disclosed without the consent of the person to
whom it relates, subject to the very limited and specific exemptions that are
in the act. Even if information may be disclosed after 20 years, there is still
the factor of complaint. Yes, it has escaped the definition of personal
information. Nevertheless, there is a good privacy principle involved here.
In the case of Statistics Canada, the promise of confidentiality is right there
on the form. It establishes for the individual citizen, Statistics Canada, and
the Government of Canada as a whole an element of trust. No convincing argument
has been given to me that would justify, in the interests of some historians,
genealogists, and other interest groups, violating or disposing of that trust.
Senator Milne: Thank you Mr. Phillips. I expect you and I will
be locking horns on this again.
Senator Atkins: Welcome, Mr. Commissioner, and thank you for
your presentation. I think it is incredible that you are in your seventh year,
and this is the first time that you have appeared before this body.
As I recall, you were concerned when they made the amendments to the Elections
Act about the permanent voters list and the misuse of that list. Do you still
have those concerns, or are you satisfied that the Chief Electoral Officer is
fulfilling his responsibility of protecting that list and using it only for the
purposes for which it was intended?
Mr. Phillips: I will try to give a quick answer to that,
senator, but I must say that I have not looked at this issue since the act was
Most of the concerns that I held at the time were addressed and resolved by the
Chief Electoral Officer. The only remaining one was the issue of making a list
available on an annual basis, which I know was a very desirable change in some
people's mind. We thought that this might expose the body politic, as it were,
to an excessive amount of political proselytization, but that got a little out
of my brief, to be quite frank.
Our chief concern was with the consent of voters to have their names put on the
list. The Chief Electoral Officer wanted to use Revenue Canada returns, because
of their current addresses, as a principal resource. We resolved that by having
Revenue Canada agree to put a consent box on the tax returns, and I was pleased
to see that more than 80 per cent of tax filers gave their consent to have
their addresses given to the Chief Electoral Officer. There were some other
changes as well, but that was the principal concern.
Senator DeWare: Mr. Commissioner, given that we have a proposed
act on the books that will change Revenue Canada to the Canadian Customs
Revenue Agency, headed up by an 11-member board appointed from across Canada,
probably political appointments, would that change your mind as to the privacy
of the use of the names?
Mr. Phillips: I must give you a conditional answer because your
question is based on an assumption. I am assuming that the proposed agency will
be subject to all the legislative safeguards that are now in place for
Elections Canada and Revenue Canada. If that were not so, then I believe we
would have something to worry about.
Senator Kinsella: It is good to have you here, Mr.
Commissioner. I also should put on the record that your assistant, Mr. Delisle,
is a former student of mine. Therefore, honourable senators, Mr. Delisle is
well trained and was one of our lead investigators at the New Brunswick Human
Rights Commission when I was chairman of that agency.
It is my understanding that, under section 72(1) of the Privacy Act, all heads
of the various government agencies have an obligation to submit reports to you
as to how they are complying with the act. In your report, which is the subject
of this Committee of the Whole, you present a table on page 48 of the top 10
departments by complaints that you have received. According to that table, from
Human Resources Development Canada there were 671 privacy complaints and 356
from Revenue Canada. The number of complaints from all the other agencies
drops way down to 20, 40, 19, et cetera.
Based upon what you tell us in that table, you are in constant communication
with Revenue Canada and Human Resources Development Canada. What is the
Mr. Phillips: First let me say, senator, that I do not know
whether we have an inside man at the Senate or you have an inside man in my
office, but in any case it is very useful.
Yes, that very high number of complaints from those two departments relates to
one particular issue, namely, the data match in which Revenue Canada supplied
the Customs forms from returning travellers to HRDC for the purpose of matching
up against unemployment insurance claimant lists, in order to find people who
were out of the country while receiving benefits. That particular issue has
triggered one of the largest body of complaints we have ever had on a single
Senator Kinsella: Has that practice stopped?
Mr. Phillips: It has stopped. We tried very hard to negotiate a
compromise arrangement with HRDC because we saw some problems in that
particular data match. We could not succeed, therefore, we joined with the
Department of Justice in a reference to the Federal Court to test the
ministerial authority for conducting the data match. We have another case
ongoing to test the validity of that kind of use of the information against the
Charter of Rights. We have had a judgment from the Federal Court on the first
question, which found that the minister has exceeded his authority. I believe
that is a fair way to describe the outcome of the case. While they contemplate
their next step, the match has been suspended.
Senator Kinsella: It seems to me, honourable senators, that
where the Privacy Commissioner and a few others are officers of Parliament, and
whereas under our system of governance ministerial accountability is to
Parliament, this is a very important area for us to mine. That is to say, when
an officer of Parliament, whether it be the Privacy Commissioner, the Official
Languages Commissioner, or any other officer, is having difficulty with the
agencies of government, rather than using the judicial system the parliamentary
system could be used.
Would you comment on that in terms of accountability of these agencies that you
have difficulty with and their accountability to Parliament, and whether or not
the Privacy Commissioner could be coming to Parliament with the problems that
Parliament could be addressing?
Mr. Phillips: I am pleased, Senator Kinsella, to hear that
suggestion raised here. The act does provide for the commissioner, should he or
she feel the problem is of sufficient importance, to make special reports to
Parliament. I have always regarded that special report provision as being a
nuclear bomb-type of provision to deal with something that I consider to be of
an all-embracing and critical national nature.
That particular case is a classic of the kind that comes up these days, and I
believe we will see more of them, of departmental officials seeking to use
databases which were collected for one purpose and used for another. It comes
up most often as a means of tracking cheats and that sort of thing, which we
all wish to do. However, it does raise privacy questions because of the
government's obligation to the people who give up all this information on
We do not have, at this moment, an effective way of dealing with that, and I
should like people to turn their minds to the problem. Any department, by
Treasury Board policy, wishing to conduct a data match is required to bring it
to the office of the Privacy Commissioner for review, and some do, if I can put
it that way. I do not have the power to stop them. I only have the right to
offer an opinion, usually delivered by a member of my staff because I must be
very careful not to be seen to be judging any particular issue in advance
against which I might subsequently receive a complaint that needs to be
I do not feel the Privacy Commissioner should be permitted to stop data
matches. There are other considerations besides privacy. Equally, I do not
believe that ministers, simply on the authority to manage a department, should
be allowed to override issues of a privacy nature. What I am thinking of is
perhaps some additional system of review.
I am very unhappy with the present situation that drove us into court. It has
cost a great deal of time and expense, and I do not wish to repeat it. However,
we are not Luddites in our office; we do recognize the great value that modern
technology can bring to government operations by way of efficiency and savings.
At the same time, bureaucrats who are under enormous pressure to improve their
systems to achieve economies tend either to ignore the privacy dimension or not
to take notice of it at all. We must do better than that. We need a better
Senator Kinsella: Mr. Commissioner, it is my understanding that
section 75(1) of the Statutes of Canada establishes that the administration of
the Privacy Act can be reviewed by a committee of either House but that such a
review has not occurred too often.
Am I correct in my understanding?
Mr. Phillips: There was one in 1987. It was provided for in the
act, which required a review after the first five years of operation.
Senator Kinsella: There has not been one for the past 12 years.
Mr. Phillips: Some very sensible recommendations were made but
Senator Kinsella: In your opening comments you made the
observation that the act needs revision, that it is leaky and creeky. You
alluded to too much exclusion. You made reference to data matching and data
mining and those kinds of things. Let me ask this question: Are there many
models available to draw from in a revision of the current Privacy Act,
including the model that exists in the Province of Quebec?
Mr. Phillips: Yes, there are a number of offices similar to
mine in this country and abroad, New Zealand, and Australia, most of the
countries of Western Europe.
In Canada, most of the offices in the provinces are based upon our model rather
than the other way around. There are also significant differences. The
provincial commissioners all have ordered powers. I am an ombudsperson and I do
not want ordered powers. I am able to take an approach that allows for less
confrontation, that allows me to try to negotiate solutions, which puts the
focus on locating and fixing problems rather than finding blame. My relations
with government departments are quite cooperative. We do get some good results.
My office was set up exclusively as a complaints investigation bureau and an
audit office. We were not given a mandate to do public education, policy or
The nature of the discussion we are having now indicates how limiting the act
is. Without the funding to do some decent policy research, it is difficult for
us to stay abreast of the swiftly changing scene. As a consequence, we have had
to patch and paste to do policy research in order to have some relevance to
Parliament in terms of being able to provide you with some cogent advice and
keep you up to date.
I have asked the Minister of Justice to take a look at amending the act to
bring it up to date. A parliamentary review would be a good thing.
Senator Grafstein: Commissioner, the last time we had an
exchange was in the Standing Senate Committee on Legal and Constitutional
Affairs. Our committee worked very closely with you in order to ensure that the
proposed DNA data bank legislation was more sensitive to privacy concerns than
might otherwise have been the case. We hope that the output of that bill will
justify our efforts in that regard. In that case, our committee insisted that
there be an independent body and that the commissioner be involved in order to
sustain and maintain privacy.
I was listening to your opening comments about the need for a constitutional
amendment to ensure the right of privacy. I could not help but think about how
that situation might have changed events in the United States if they had
adopted the right to privacy in the last year or so. Things are ever fresh in
constitutional matters. Who knows, we may adopt that principle.
I am interested in your mandate with respect to reviewing legislation.
Legislation pours through this and the other place. Many legislative matters
impinge on privacy. Do you consider one of your mandates to review all
legislation for sensitivity to privacy matters?
Mr. Phillips: If we did not look at legislation, we would not
know what is going on. In that respect, we would be failing in our duty to the
chamber and the other place. We do our best, and that is all I can say. I have
very limited resources for that purpose. I have one very competent officer in
my office who takes care of that work as one of her many duties. We do not
have adequate resources to thoroughly canvass all of the legislative
Funding has been a severe problem for our office. I know every official coming
before a parliamentary body drags out this crying towel. However, ours is a
special case. I am almost embarrassed to tell you what our operational funding
has fallen to as a consequence of historic underfunding complicated by
government reductions. This year our allocation is approximately $100,000. Let
me tell you how this affects what is essentially a complaints investigation
The credibility of my office and the investigative process depends to a
significant extent on the ability of my investigators to go on site where these
complaints occur; that is frequently out of town. It would not take my office
many investigations to exhaust a budget of that size.
Senator Grafstein: I understand what you are saying. That was
not the thrust of my question. The thrust of my question was: Do you consider
part of your mandate to review draft legislation before it is passed?
I try to read all the legislation that comes before this body, not in detail,
but to try to grasp some of the central principles. It is one of the jobs of
all legislators. Do you consider legislative review to be part of your mandate
in order to raise some red flags to indicate a problem or possible problem? Do
you consider your mandate sufficient to survey or verify privacy issues in all
Mr. Phillips: The answer to that is in the affirmative if, by "mandate,"
you mean our responsibility. This is not specifically mentioned in the statute
as one of the things that we are instructed by Parliament to do. However, there
are many other things that are not mentioned either. We have a responsibility
to do our best in that respect. However, we need more funds to do our jobs
Senator Grafstein: Yesterday in the Foreign Affairs Committee
we were reviewing Bill S-22. This is proposed legislation authorizing
preclearance of travellers and goods in Canada for entry into the United
In that bill is a provision that allows American officers on Canadian soil to
obtain reams of specified information about travellers, all with a view to
offsetting difficult issues. That information goes into a data bank and a
preclearance officer is obliged under the statute, if they do not use the
information, to destroy it within 24 hours:
...unless the information is reasonably required for the administration or
enforcement of Canadian law or preclearance laws.
Essentially, it is their choice as to whether they retain that information.
That is a massive amount of personal information. We are wrestling with this
subject in committee. It came to our attention as we reviewed the bill.
I cite this as a specific example as to whether or not your office considers it
part of its mandate to raise red flags in order to provide parliamentarians
with some advice on matters such as this.
When you consider the liability section, there is a limitation on liability
against those preclearance officers even if they fail or omit to do anything
under the proposed legislation from a civil aspect.
It is a major concern. More than 50 million trips are made across the border
every year. Massive amounts of our information exist in American computers. I
raise that as a question.
Mr. Phillips: Senator, we are looking at that particular bill
now, even as we speak. I expect we will have something to say about it very
shortly. We have not had it long, just a matter of a few days. Some of the
implications were immediately apparent, but we are looking at it now and will
certainly be prepared to offer some observations on the subject.
You mentioned the DNA bill. Let me compliment the members of the Senate
committee who handled that particular issue. The end result was a wonderful
example of what happens when a parliamentary committee digs in and knows its
Senator Grafstein: You are referring to a Senate parliamentary
Mr. Phillips: Yes, I refer to a Senate parliamentary committee.
The bill was greatly improved in the process. We had a very serious concern
about some aspects of that bill and they have been pretty much resolved.
Regarding the DNA bill, my point is that we came to the Senate committee
because we were doing precisely what you were discussing, which is monitoring
Senator Grafstein: With respect to the new computers in
telephony, particularly those computers which measure the quantum of telephone
use by users, those telephone numbers are now being monitored. There are reams
and reams of these records. Senators will note that their telephone bills
include reams of numbers, all of which are recorded in a computer. We all have
two or three telephones and we are getting these long lists.
It struck me that the amount of information in such a federally-regulated
industry puts enormous power on issues of privacy into the hands of an
authority or a public corporation without any survey on what they do with that
information or when they drop it.
I have not looked into this question. Has there been any thought on your part
about that type of information? Can those long tracks of private information be
curtailed, such as requiring that, after a year, the computer records be wiped
clean? Have you given any thought to that? Is that an issue for you?
Mr. Phillips: Yes, of course, it is an issue. Those are typical
of the kinds of mass information holdings that private corporations can
collect. If it is not subject to some reasonable privacy standards, it can be
abused and is being abused. We can give you terrible examples of information
that has been collected and wrongly used.
I am assuming that if Bill C-54 passes this chamber and Parliament, we will go
a long way toward getting a handle on that kind of problem, because Bell
Canada's information management practices then would come within the purview of
the office of the Privacy Commissioner. They would be required to subscribe to
a legally established standard of information management, which is set out in
the bill, principally guided by the Canadian Standards Association Model Code
of Information Practice which was devised, in part, by private sector people.
That would become the law and they would have to live with it.
The notion, therefore, that all of that telephone numerical information - which
provides all sorts of information, including a very good guide to the interests
of the callers and their locations at any given time - would be protected by a
statute. That is the whole argument on behalf of legislating legal privacy
Senator Di Nino: Welcome, commissioner. As a former member of
the press corps, I am sure you must be very pleased that when you come to the
Senate, you get an elevated position.
Mr. Commissioner, you and others have raised concerns about the privacy of
information held by financial institutions. As you undoubtedly know, they have
a privacy code to which all financial institutions claim to adhere. It has been
suggested that if the financial institutions were really serious about the
privacy of information, they would use your office either as an appeal
mechanism or simply as their overall privacy adjudicator.
Could you give me some comments on that, and perhaps a bit of a report card on
how the financial institutions are behaving themselves, or otherwise, as well
as some advice or suggestions on how we should deal with that issue?
Mr. Phillips: To answer the last question first, I cannot give
you any kind of informed judgment on the behaviour of financial institutions in
this country. I have only anecdotal evidence. The reason is, of course, that at
this moment I have no jurisdiction.
We do get complaints from people around the country. We can do very little for
them except offer them comfort and sympathy because I have no right to go
through the doors of a bank to ask any questions.
The Canadian Bankers Association and some of the individual chartered banks
have developed good voluntary codes of practice. If they lived up to those
codes in spirit and letter, that would probably be sufficient. I do not think
that is enough in this day and age and I have no notion whether they live up to
them or not.
In any case, we have reached the stage where the collection and use of personal
information is now one of the principal activities in the business and
governmental world. People are entitled to have legal rights respecting the use
of that information.
We have a bill coming before a Commons committee now which will do exactly
that. I have not yet heard the Canadian Bankers Association, as they have not
appeared before the committee yet. However, it is my understanding that the
Canadian banks feel that the powers given to the Privacy Commissioner in that
bill are excessive and unnecessary. I am sorry that they are taking that
position. The consumer advocates, on the other hand, feel that the powers given
to the commissioner under that bill are lamentably inadequate. I guess the bill
strikes a pretty good half-way position.
It is an act of some courage and imagination that the government has adopted
this position. It will not get an easy ride. The bill needs some improvement
and there are some powerful interests which do not like the idea, but the time
has long since come for the acceptance in this country of legally established
Such laws have existed in most of Western Europe now for several decades. They
are well ahead of us. Australia is now moving toward it. New Zealand has had it
for some time. There are recently independent countries in Eastern Europe which
were very quick to move toward data protection laws of the kind that we are
talking about here. Those people recognized from their own unhappy experiences
the dangers that are involved when the state or corporate interests can take
personal information and use it in any way they want. Our time is long overdue
and I am glad to see it is at last happening.
Senator Di Nino: That pretty well ensures you will return to
the committee structure - I am not sure which one it will be - of the Senate in
the not too distant future because obviously your comments have hit a chord
today, particularly when you equate privacy with freedom. That was something to
which we all paid attention.
I have a practical question dealing with some of the anecdotal evidence of
which you spoke in relation to financial institutions abusing or misusing data.
Have you heard of problems existing in the misuse or abuse of the data
financial institutions have when it comes to cross-selling? To be more
specific, are the banks or other financial institutions using the data they
have to sell services in the insurance field or mutual fund field, something
which was never intended when the original service was entered into?
Mr. Phillips: I think you can get a more complete and accurate
answer to that by examining the report of the Canadian Bankers Association
ombudsman, which was issued a few days ago. I have not gone over it in detail,
but tied selling is one of the principal problems with which he has to deal,
and those problems arise from bank clients. I cannot give you any more than
fragmentary views on the subject.
If you have friends in the investment dealer community, they may tell you that
the bank that owns them does not have anyone in the bank sending account
information. However, it is hardly necessary if two people meet for lunch and
one says to the other, "You should get in touch with Joe Smith, who blew
into town the other day from Vancouver." If a banker says that to an
investment dealer, it conveys something. As far as I know, there is nothing
unlawful about the practice. However, I would not want to be in the position of
trying to pass any kind of judgment, as I do not have enough information.
Senator Di Nino: I appreciate that, and we will look forward to
seeing you when we deal with Bill C-54.
Senator Oliver: Mr. Commissioner, on two or three occasions
when you have appeared before committees on which I have been sitting, we have
discussed the issue of privacy in relation to medical records - that is,
patient-doctor records and patients' hospital records and insurance records,
such as the details of a person's private health concerns contained in an
insurance policy. One of the things that will never leave my mind was evidence
before one of our committees about where some Canadian insurance health
particulars are actually stored and how easily accessible they are to the
general public. I am hoping you can comment on that to let us know whether that
problem has been cured.
My specific question today deals with computer storage of some of these records
and what will be done with them. Do you think Bill C-54 will be a big enough
and good enough remedy to ensure that privacy of our medical and insurance
records is contained?
Mr. Phillips: The answer to the question, Senator Oliver, is
A good deal of personal information is gathered in Canada in the course of all
kinds of enterprises and activities, health being one of them, which is
processed in the United States.
Senator Oliver: In Hartford, Connecticut?
Mr. Phillips: I believe the medical insurance bureau to which
you refer is based in Boston. I think that is what you are talking about.
Yes, insurance companies routinely file from Canada to the United States a good
deal of information they have gathered from their policyholders. That
information, once it is out of the hands and over the border, is essentially
beyond the control of any Canadian law. I do not think Bill C-54 really deals
with that problem. It does deal with the information, though, as long as it is
inside Canada. It may be that the problem can be approached through the
disclosure provisions of the code. I am sorry, but I will defer a more complete
answer to that question.
Senator Oliver: What happens in Canada when marketers marketing
health products have access to some of our private insurance health records,
records from hospitals and patient-doctor records? Will Bill C-54 be able to
curtail that use when the information is stored in various computer systems
Mr. Phillips: No, I do not think so. It could.
Mr. P. Julien Delisle, Executive Director, Office of the
Privacy Commissioner of Canada: Honourable senators, Bill C-54 deals
essentially with commercial transactions. If it is a doctor-patient
relationship, which is not part of any commercial transaction, it falls outside
the ambit of the bill.
Senator Oliver: What if someone has the data and they suddenly
start to commercially market a particular health product based upon information
they gained and gleaned from reading private health records, either from a
hospital, a patient or an insurance policy?
Mr. Delisle: Then it may be subject to Bill C-54.
Senator Di Nino: It may be?
Mr. Delisle: Yes, but we would have to look at the specific
Right now the private sector is largely unregulated anyway, so there is no
legal protection with respect to those issues.
Mr. Phillips: One of the problems with the bill in its present
form, Senator Oliver, is that it says it covers commercial activity. However,
commercial activity is not sufficiently and clearly defined. Does it cover
things, for example, such as non-profit or charitable organizations? In the
case of a charitable organization, would it cover only that part of its
activities in which they hired people to raise funds and paid them? What effect
would that have on any records created as a consequence? There are some
complications and ambiguities involved here that we must sort out.
Professional associations, such as bar associations and medical associations,
are not specifically mentioned. Will they be covered, "yes" or "no"?
If one sees a lawyer to get advice and a bill is sent, is that a commercial
activity, or is it excluded because it is generated by a person involved in a
professional activity not covered by the act? Again, we have to sort a few of
these things out. I hope by the time we get back here before this chamber, we
will have answers to those questions.
When I said maybe, I would lean more at this stage to "probably yes."
When we look at what you are talking about, there is certainly bound to be a
commercial activity involved there somewhere that would require the consent of
the people whose information is involved before it could be used.
Senator Cools: Mr. Chairman, how long will we be? We do have
other business to deal with today. Did we set a time frame?
Senator Carstairs: No, we did not.
Senator Cools: Welcome, Mr. Commissioner. You stated that you
are an officer of Parliament, and most of us know exactly what that means. Your
particular position as an officer of Parliament has a different history, say,
from the electoral commissioner, who essentially took over the tasks the
Speaker and the clerks of the House of Commons used to perform in respect of
elections. I know that you are an officer of Parliament, but how does that
affect the running of your office in a day-to-day manner? In other words, what
do you do daily that other office holders who are not officers of Parliament do
not do, other than giving one report to Parliament annually?
Mr. Phillips: We investigate complaints against government
departments daily. We receive an average of 2,000 complaints annually about
various alleged abuses of personal information by people in Canada. We are
required by the statute to investigate them.
The process of appointment, senator, and the process of accountability by which
I report only to the Speakers and to the members of both Houses is to make
absolutely sure that there can be no perceived or actual conflict of interest
in the operation of my office. I am not subject to a direction by any
department of government. That is the principal difference between what I do
and what, say, a deputy minister in a line department does. He is under the
control of the minister and the executive of the day; I am not. I am under your
Senator Cools: That is quite true, but the chairman of the
National Parole Board, as chairman of such a tribunal, also has similar powers
to do certain things. Those types of positions are not deemed to be for
officers of Parliament. I am trying to get at the relationship of the officers
of Parliament to Parliament, and the impact and the influence that that
relationship has on your day-to-day operations.
Mr. Phillips: I do not know that I can answer it any better than
I already have. The National Parole Board is in the business of examining the
suitability of people for parole. I am in the business of investigating the
National Parole Board from time to time and have done so. It would be a very
awkward situation, for example, if my office and the office of the Solicitor
General, which is the department to which the parole board reports, were both
run by the same minister. It would be impossible to have a credible complaint
investigation agency if it was under the thumb of a departmental minister.
We have a few problems with it as it is because in the financial area the
Department of Justice - because privacy is under the justice envelope - is
required, under the Financial Administration Act, to sign off on our Treasury
Board funding submissions. This could be seen by some as a possible source of
perceived conflict. However, it does not bother me. The Department of Justice
has never in any way done anything other than add their pro forma signature to
our submissions. They are mildly uncomfortable with this arrangement, too, but
I do not think it is a serious problem.
I do not know what more I can tell you. The officer of Parliament works for
Parliament. The National Parole Board works for the government. That is the
Senator Cools: I have another question which is a bit more
difficult and quite speculative. It may be awkward or difficult for you to
answer, and I would understand that.
You have had extensive experience in privacy issues, and a life-long experience
as a journalist, so you have unique experience. A couple of weeks ago, many of
us were shocked by the depictions of Minister Sheila Copps in Hustler
magazine. It bothered a lot of us here. It bothered Senator Kinsella and myself
a great deal. I looked at the depictions. I examined the matter carefully.
My question for you is: Is there an issue of privacy there? If you look at
those depictions, there is nothing "unlawful" about them. They are
not perpetrating a crime. It certainly is not an issue of libel or slander
because there is no slander, but what is it? Where does a minister or a member
of Parliament look for protection in legislation against that sort of thing?
You began by quoting from Mr. Justice La Forest who said that privacy is at the
heart of liberty, and so on. Have you given any thought as to whether or not
there is a privacy issue there?
Mr. Phillips: There is certainly a privacy issue, absolutely.
There is a privacy issue involved every time any individual's personal
information is used for publication purposes. However, whether it is for or
against the law and whether it is right or wrong are additional questions.
I have views on a good deal of these things. If you or anyone else can propose
a system for correcting the abuses of bad taste of that nature that occur in
public that will pass muster with the Charter of Rights and Freedoms - in
particular, the free press - I would like to hear about it.
I share with many people some dismay at what I consider to be a decline in the
standards of good taste in some areas of journalism.
Senator Murray: It is more than a question of good taste.
The Chairman: Order, please!
Senator Cools: I would be happy to defer to Senator Murray for
The Chairman: Senator Murray, with Senator Cools' permission,
you may ask a supplementary question.
Senator Murray: I was about to come to a question along these
lines, but it was not specifically related to Minister Copps.
My question is: When will there be some protection for Canadians against
invasion of their privacy by the media? I have never been victimized myself - I
hasten to say that - but I know quite a few people who have in politics and in
other areas where they achieved some degree of prominence. All of a sudden,
matters that have to do with their personal, private or family lives are
retailed in the media. Those are invasions of privacy. Why can there not be
some protection for Canadians?
Mr. Phillips: Senator Murray, when you are referring to public
media, the issue is: How much invasion of privacy is justifiable? We could get
into an interesting and extended discussion on this point. How much expectation
of privacy and what kinds are people in public life entitled to claim? What is
their reasonable expectation of privacy? These are not simple questions.
Finding a legislative answer to them would be extraordinarily difficult.
The real problem with the media these days is partly induced by the enormous
competitive pressures of television, inadequate resources for proper editing,
and inadequate training of journalists in areas dealing with ethics. Let me
cite one example of the kind of thing I am thinking about. When I started in
the newspaper business forty years ago, my first day on the job, as I was
rolling the paper into the typewriter carriage to write an obit, the managing
editor of this small newspaper came to me and said, "What are you doing?"
I said, "I am about to write an obituary." "Good," he said.
"Just remember that every time you put someone's name on a piece of paper
for public distribution you are accepting some responsibility for that person's
reputation thereafter, dead or alive." I have tried to remember that. I
think most of the reporters and journalists of my generation did try to
measure their writings against that kind of standard. I am not sure that the
same kind of attention is paid to those issues when young journalists start out
in their careers these days.
Having been around here a long time - and, people who have been here for
similar periods of time would probably agree with me - it is worse now than it
used to be. Maybe the answer is in better tort law but I do not think it is to
be found in trying to establish "what is" and "what is not"
in a legislative framework - that is, a whole set of areas that you cannot
report upon. It is very difficult. I must make the claim on behalf of my former
occupation, sometimes, to know where to draw the line.
There are many people, particularly those in public life, who are the principal
targets of this kind of journalism and who welcome a lot of public attention.
The Princess Diana case is an interesting one from that perspective. Many of
the people involved complained bitterly and incessantly about the horrendous
stories that were written in the London papers, and the British Parliament was
on the verge of passing restrictive legislation when it was discovered that
these people were complicit and had encouraged the transmission of a lot of
this very squalid and sordid material to the newspapers.
We have to be a bit careful about this kind of thing. The answer, in my view,
is to be found inside the industry itself, I hope.
Senator Taylor: I was introduced to the commissioner many years
ago through the medium of television. He has lost none of his persuasiveness.
If he were ever to enter politics, he could be dangerous.
I have been a friend, for some time, of your assistant. I always wondered where
some of his views came from, and now that Senator Kinsella has admitted to
having a hand in shaping those views, perhaps I will be able to trace it back
My question will be fairly short but perhaps a bit off the wall. Is the
government infringing on my privacy by asking the sex of my partner when
preparing pension benefits? What business is it of the government to know
whether my partner is male, female, or maybe an it?
Mr. Phillips: I can only answer the first question. Yes, it is
an intrusion in your privacy, absolutely, because they are asking you to give
up what you consider to be personal information, and which my aunt would
consider personal information, too, I think.
Whether it is justifiable in the circumstances, whether it strikes that famous
balance that bureaucrats are always talking about when they want to strip you
of your privacy, is the question. I could only give you my answer as a Privacy
Commissioner if I knew all the circumstances.
Was the information absolutely necessary to properly administer the program in
question? Could they do so just as well without that information? To what uses
will the information be put? What security is attached thereto? Those are the
questions that concern a Privacy Commissioner.
We start from the position that any disclosure of your personal information
constitutes a subtraction from your privacy, if adequate controls do not
surround the transaction of the information.
Yes, there is a loss of privacy involved. Is it right or wrong? I cannot answer
that question until I know more.
Senator Andreychuk: Mr. Phillips, I had the benefit of
listening to your views with regard to the DNA bill and was much taken by your
concern for your proposition that you must put forward a strong position for
privacy. I also liked the fact that you said that privacy rights are not
absolute, that they have to be balanced against other rights. Consequently, if
I understood your reasoning during our deliberations on the DNA bill, we could
have had more privacy but we opted for a position of understanding the costs
that that might bring if we used individual profiles rather than clustering
profiles. You also understood that the profiles may change as our information
changes. The way that I look at rights, we are constantly balancing one right
I want to go back to Senator Milne's discussion about the census. While this
was not legislated, people gave information on the understanding that there
would be confidence under the census. Let us say 100 years pass. In my case,
there will be no children, but who knows where my extended family will be in
100 years. It seems to me that, in a democracy, information collected by the
government and put under seal may still need some examination at some later
date, to determine the accuracy of the information and to determine whether it
was used properly, or at all. In a democracy, we can learn from our history.
You might wish to comment on that.
I also wondered if you would be in favour of the government entering into a
public debate to reopen those census records, as they have in Australia and
other countries, perhaps after 90, 100, or 150 years. Who knows where the
breaking point should be?
I know you considered this issue from the perspective of historical research
and genealogical research. I am looking at it from the viewpoint of fundamental
democratic rights, such as the right to a double-check on a government system.
Sometimes that double-check is immediate, in some cases fulfilled by the
Senate; but at other times, time needs to pass and we need to reflect. I think
of the 1911 census, when so much information was taken. Now there is the issue
of internment of certain immigrant classes. We know by access to some of that
information, through their kin, that it was false and was used by other
Would you therefore still absolutely say "no" to access to that
census data, or do you believe that this broader debate should take place and
that the government should encourage that?
Mr. Phillips: I would certainly agree that there should be a
very broad, extended, public debate before the terms on which census data
collected from Canadians is altered. I would agree with you that far, senator.
I say that based upon my own experience of the extreme sensitivity with which a
great many Canadians consider this census data. There have been two censuses
since I started in this office, and each has generated an enormous number of
complaints to my office relative to our normal flow of traffic. Generally, they
turn on the subject of the intrusiveness of the questions.
It would be a pretty poor privacy commissioner, senator, who would easily yield
to a plea for access to that kind of information by genealogists and
I might be more easily persuaded if that were the only or most important source
of information for historical research, but, clearly, it is not. I have seen
some of the work that has been assisted by access to census data in other
places, so I do not deny its value.
We have a system here in which Statistics Canada is charged, by law, not to
disclose that information to anyone. I think that is the safe way.
Who among us really is ever in a position to make the decision about disclosure
of that kind of information on behalf of someone else? That is what is proposed
here. There are millions of people who have given up that information. All of
them did so on the assumption that it would be protected from disclosure
forever. Many of those people may very well believe that it is essential that,
long after they are dead, that information be kept sacrosanct.
Let me give you a parallel experience, although it is not a precise analogy.
There were many servicemen in Canada who were the fathers of children born
overseas during the war. They came back to Canada, picked up their lives, got
married, and had more children. Now there is a great appetite among people in
Britain to know more about their biological fathers. They have come to Canada
as a group and are individually asking the Department of Veterans Affairs and
public archives to track these people down so that they can get in touch with
One can understand the anguish that lies behind some of those requests. They
came to us and asked for our view. It was my view that unless these former
servicemen consented, their privacy should be protected. I know that hurt
people. I can tell you, however, that we took the trouble to get in touch with
them ourselves, or public archives did, and we asked, "Do you wish to
have your whereabouts disclosed to your children or grandchildren in Britain?"
The answer in the overwhelming majority of cases was "no."
This is a case where one could identify a benefit to the people who wanted to
breach someone's privacy. If there had not been a requirement of consent
involved here, the institution might well have done so. We cannot put ourselves
in the position of making decisions on behalf of other people as to how much
privacy they want. We can only go by these well-tested principles that apply
to Statistics Canada's informational practices. There is a law to fortify it.
There is a reason for that law. It is there because Canadians are touchy about
this census data, dead or alive. We must be careful before we monkey around
with that. I certainly agree with you that if there is anything like that being
contemplated, there should be the broadest kind of public debate.
Senator Andreychuk: One of the comments that has been made
about the last number of censuses is that information gathering has gone way
beyond what a census should gather and has become a ruse for getting other
information in a quick and easy way.
We do have examples where, in the public interest, we have breached previous
confidentiality, and that is in adoptions. We chose to reopen those cases for
the benefit of children who have diseases, et cetera, and need to know their
biological contacts. It seems to me that a debate in the public interest would
be the right way to go.
Mr. Phillips: Senator, different people will think different
things about these issues. It is a good debate.
With respect to the types of questions being asked by the census, yes, they are
certainly asking for interesting kinds of information. If you have problems
with that, I am not really the person to answer. The Chief Statistician will
probably give you the answer that he has given me, which is that there is a
defined, urgent public need for the kinds of information that is sought on the
On behalf of the process, I will say that it is very exhaustive. Committees of
experts from all over the place consider all these things as they winnow down
the list of census questions. No doubt they are extremely intrusive, and there
is a substantial loss of privacy involved which, in my opinion, mitigates even
further in favour of keeping our bond with the Canadian public.
Senator Andreychuk: Bill C-54 will put a lot of responsibility
on the Privacy Commissioner, and certainly the resources will be needed if you
are to be effective. I think it was more than a crying towel; I think it was an
honest piece of information that you are giving the senators before we get to
Can you comment on the issue of encryption and the information that you are
receiving and will be looking at from the business community? Once the
information is in the hands of someone else, whether it is the police or the
Privacy Commissioner, those people will go offshore and run their businesses.
Not only is it a question of us being involved in the loop on international
business, but if we are to fight international crime, we need to break into the
encryption for the police.
Should the police be monitoring the encryption systems and the financial
institutions, or should the Privacy Commissioner be doing that? Do you feel
there is a need for more powers for the RCMP in that respect, or do you believe
there is a role for both your office and the RCMP?
Mr. Phillips: I do not believe the police should monitor
anyone's communications unless they have a proper warrant to do it.
Senator Andreychuk: I am saying they would do it under the
Mr. Phillips: I do not think legislation that would permit any
other kind of surveillance should be approved by a democratic legislature
My view of encryption at this stage of the game is as follows: Electronic
commerce will be greatly facilitated by the more widespread adoption of
encryption. It is happening all over the place. I do not favour what is called
the public key escrow system in which people who are using encryption systems
have to give them all up and have them stored by some third party so that the
police can get them whenever they want.
If I can use a more ancient sort of analogy, it is like saying you must give
the police the key to your mailbox. Codes have been used in commercial and
personal traffic for centuries. There has never been any suggestion before this
encryption debate began that somehow or other the police had to be given keys
to all these codes. I am not at all persuaded that the possession of these keys
would have any significant impact on criminal enforcement. If anything, it
would probably drive the criminally inclined to find some other means of
communication. This subject will be around with us for a while, but that is my
position as of now.
As for the banks and their arguments that the business will go offshore, I
would like to know where they would go. I think you should be sceptical of
these arguments. The chartered banks of Canada, by and large, have been
operating in Europe for decades where they have much more stringent data
protection laws than is proposed before the Parliament of Canada, and I have
never heard them complain once that they could not do business there.
Senator DeWare: I should like to follow up, Mr. Phillips, on
something Senator Taylor said, but my question would be in connection with Bill
C-68, the Firearms Act. When they presented that act, I imagine you looked at
the data that they were asking for to register a firearm or to buy a firearm.
It is not only your name, age and address, your criminal history, but you must
provide medical information, as well as psychological information, emotional
information, loss of job, failure in school, marital status, which is not
allowed in many cases, and other significant relationships.
You must have had some input into that and asked them how they would control
Mr. Phillips: You put your finger on the issue of how to
control the information. We have had many complaints about these forms,
senator. People were thinking that the questions put are altogether too nosy
We have taken that issue up with the firearms people. They have been able to
make a fairly decent case, if I can put it that way, that all those questions,
which have been psychologically approved, are necessary to make a considered
and informed judgment as to whether the person applying for the possession of
the firearm is likely to indulge in violent behaviour or misuse of a firearm.
You have to make what you will of that. There is no doubt that they are
The more relevant question for my office is how that information will be
managed and controlled. I must tell you that we are not terribly happy. We have
been working with the people charged with bringing this gun registration system
into effect. We have been looking at the forms. We raised a number of
questions. I will not go into them in great detail here. We suggested a number
of changes to improve the degree to which the confidentiality, security, and
privacy of the information could be protected. We urged them to be put into the
bill. They told us they would be put into the regulations. We did not see them
in the regulations. They told us they would be taken care of in the forms. The
forms are now out. We were not shown the forms before they were published, and
they have not acted on many of the things we suggested. We are not happy with
this situation. We think that it is altogether too loose, that there are too
many areas in which the information can leak to unauthorized places, and that
it should be fixed.
The Chairman: Honourable senators, I have exhausted the list of
All that remains, Mr. Commissioner, is for me to thank you for responding to
our invitation and giving direct answers to our questions. Your remarks
clarified for us the role you will be playing and they will certainly help us
in our future deliberations. Mr. Philips and Mr. Delisle, we offer you our
Senator Kinsella: Honourable senators, I think you will agree
that the Committee of the Whole has concluded its deliberations.
The Chairman: Honourable senators, you have heard Senator
Kinsella's proposal. Do you agree?
Hon. Senators: Agreed.
The Hon. the Speaker: Honourable senators, the sitting of
the Senate is resumed.
Report of Committee of the Whole
Hon. Fernand Robichaud: Honourable senators, the Committee
of the Whole to which was referred the report of the Privacy Commissioner for
the period ending March 31, 1998 has asked me to report that the committee has
concluded its deliberations.
State of Financial System
Consideration of Report of
Banking, Trade and Commerce Committee on Study-Debate Adjourned
The Senate proceeded to consideration of the seventeenth report (Interim)
of the Standing Senate Committee on Banking, Trade and Commerce entitled: "A
Blueprint for Change" (Volumes I, II and III), tabled in the Senate on
December 2, 1998.
Hon. Donald H. Oliver, for Senator Kirby, moved the adoption of
He said: Honourable senators, the past decade has witnessed the beginning
throes of the convergence of banking, insurance and funds management into a
single financial service marketplace - a North American marketplace if not a
global one. What only six years ago was thought to be a stable and level
playing field on which regulated and unregulated financial institutions alike
could operate has shifted once again. For a second time this decade, we as
public policy makers are being challenged to restructure the sector's
regulatory framework with a view to rebalance its competitive and prudential
profile, knowing full well that the landscape will continue to shift for the
foreseeable future and, as the Banking Committee was told by virtually every
witness at its hearing, the status quo is not an option.
At the outset I want to make it clear that the MacKay task force did an
outstanding job. Charged with the duty of making recommendations for reform of
this sector, the task force tackled all of the important issues head on. The
Committee on Banking, Trade and Commerce endorses most of the 124
recommendations of the task force but has many recommendations of its own to
I wholeheartedly endorse the committee's report. The committee's non-partisan
approach led it to draw conclusions and make representations that I believe
will leverage the task force work in a way that will obtain what has proven to
be an elusive objective - a vibrant, innovative, prudentially sound financial
services sector for the beginning of the next millennium.
The committee unequivocally makes the point that competition from tier two
financial institutions, such as trust companies, credit unions and the caisses
populaires, will not be forthcoming overnight. Instead, it will take from three
to five years for effective competition to take hold after the reforms are
introduced. We can only hope for speedy implementation of our path-breaking
recommendations so as to alleviate the sector's growing pains and establish a
solid footing for Canadian firms facing competition from Goliath-like foreign
financial institutions in an increasingly global marketplace.
Let me now go over the salient differences between the proposals of the Banking
Committee and the MacKay task force. A major thrust of both reports is the
fostering of increased competition across the full range of financial services,
and particularly in banking services. The committee, however, proposes
alternative and, I believe, better ways of achieving this objective, whether
this competition comes from existing financial service providers, new
home-grown financial services providers, or foreign financial services
I want to focus on two areas of general interest that should not be overlooked
- organizational structure and taxation. In terms of the first, your committee
has taken a different approach from the task force on ownership rules,
grandfathering provisions with respect to these ownership rules for presently
non-conforming financial institutions, flexible corporate structures, and
accounting rules dealing with the treatment of goodwill involving corporate
acquisitions and takeovers. In terms of the second, your committee goes beyond
the task force recommendations to eliminate capital taxes and it recommends a
reduction in capital gains taxes.
Let us begin by focussing on the ownership question. The MacKay task force
recommends three classes of financial institutions based on their equity sizes.
Small businesses can be closely held, allowing for as much as 100 per cent
ownership in a single individual's hand. For medium-sized firms, a 35 per cent
equity float would be required. For large financial institutions, ownership is
required to be widely held; that is, no individual or company would be
permitted to hold more than 10 per cent of the voting shares of the
corporation. This can be increased to 20 per cent with ministerial approval and
the passing of a "fit and proper" test, and further on a temporary
basis, up to 30 per cent with ministerial approval.
Your committee, on the other hand, would raise the widely held ownership rule
for large financial institutions to 20 per cent of voting shares and 30 per
cent of all classes of shares.
This recommendation, the Banking Committee felt, will achieve three goals.
First, the ownership question will be left to market forces to sort out, not to
the Minister of Finance and his department who may be tempted to impose
unnecessary hurdles for approval or to cause uncertainty that will adversely
impact the company's share price. In these matters, free and unencumbered
bidding for title to these assets will best assure their proper allocation to
the highest valued uses. Second, it provides greater flexibility for mergers
and acquisitions that include share swaps in the transaction. Finally, and most
important, large shareholdings will provide a greater incentive for investors
to monitor and influence the performance of the financial institution's
management. It would also allow investors to take advantage of equity
accounting rules that provide more transparency to the investor company's
shareholders who, in turn, will have an incentive to exercise indirect
influence over the management of the financial institution.
The committee, by adopting this 20 per cent rule and not the 10 per cent rule,
distinguishes control from ownership. It is generally recognized by the
accounting profession and others that having 20 per cent or more of the voting
shares of a company, without anyone else having 20 per cent or more ownership,
provides such an owner with a significant influence, but not control, over
operational and financial decision making of the firm.
Moreover, equity accounting rules would also apply under these circumstances.
The equity accounting method recognizes the profits and losses from an
investment, in this case the financial institution, immediately when they
occur. That is, they are recorded on a quarterly basis on the investor's
financial statements. In contrast, investments of less than 20 per cent use
the cost accounting method, whereby the investor's books ordinarily reflect the
financial institution's historical purchase price. Under this valuation method,
the investor's books do not begin to reflect the operational performance of its
investments until extraordinary re-evaluations or write-downs occur.
Obviously, the more timely reporting of financial performance under equity
accounting rules provides more transparency to shareholders and would bring to
bear more pressure on an investor company's management to influence the
performance of the financial institution.
Let us now turn to the issue of financial institutions that do not presently
have ownership structures that conform to the proposed structure of the MacKay
task force. Specifically, we are talking about the Great-West Life Assurance
Company, which is owned and controlled by Power Corporation, and Canada Trust,
which is owned and controlled by Imasco.
The MacKay task force would grandfather the present ownership structures of
these corporations for as long as the current majority owners possess their
respective financial institutions, regardless of the possible graduation of,
say, Canada Trust to the larger financial institution class. The task force
would further extend the closely held privilege to immediately succeeding
owners of these institutions. The Banking Committee would instead grandfather
the current ownership structure of these financial institutions, provided they
remain in their existing institutional class only. Once Canada Trust graduates
to the larger classification, it must, within five years, comply with the
ownership rules of that particular class.
The committee would also extend all powers granted to financial institutions of
that class, regardless of their ownership structure, that is, whether or not
they presently conform or are provided an exemption through the proposed
grandfather provision. As for the MacKay task force rule that would extend the
closely held privilege to the next owners of these financial institutions upon
sale, the committee believes that this would introduce unneeded complexity and
be of little value to the current owners.
The committee is of the opinion that its proposed grandfathering provisions
will not inhibit Canada Trust's incentive to grow into the large financial
institution class and, at the same time, will provide the Great-West Life
Assurance Company similar powers to compete on a level playing field with its
larger rivals. Being accorded the ability to acquire the other financial
institutions will better equip the Great-West Life Assurance Company to be a
more effective rival and can only render the sector more competitive.
Furthermore, this proposition offers a more appropriate balance of equity and
flexibility than does the MacKay task force proposition.
I now turn to the committee's recommendations on a more flexible organizational
The task force acknowledged that one way to support more competition in the
financial services marketplace is to provide financial institutions with the
option of using more flexible organizational structures. To this end, the task
force recommended that a regulated holding-company structure be available to
allow financial institutions to organize their activities.
The committee believes that a holding-company structure could afford a much
needed level of flexibility to financial institutions without compromising
safety and soundness. A holding-company model would make it easier to separate
wholesale and other financial service activities from retail deposit-taking
activities that are now possible within the confines of a parent subsidiary
model. The ability to separate deposit-taking from other activities would allow
for regulation according to the level of risk, making the level of regulation
for those activities more closely aligned with the regulation of non-bank
A holding-company model would also allow subsidiaries of the company to engage
in a broader range of financial services. This would make it easier for
regulated financial institutions to raise capital, enter into strategic
alliances with business partners, and facilitate the grouping of medium-sized
financial institutions across different financial pillars.
Our committee proposed a holding-company model.
Senator Carstairs: Out of respect for the parliamentary
reporter, could the honourable senator slow down just a bit?
Senator Oliver: I apologize.
Our committee proposes a holding-company model that is somewhat different from
the model proposed in the task force. Like the MacKay task force model, the
committee's proposal will be a regulated non-operating financial holding
company. The non-retail deposit-taking entities would operate under a
regulatory regime geared to the risk associated with their businesses. This
would allow the regulated financial holding company to more effectively compete
against other financial service providers that offer products and services in
an unregulated environment.
For example, in the case of the wholesale financial market segment, where
unregulated finance companies operate without CDIC insurance or to the
adherence of OSFI's prudential regulations, a non-deposit-taking affiliate of
the financial holding company could operate on the same basis, that is,
unregulated by OSFI, while at all times allowing OSFI to have access to the
information it requires. This feature, the Senate Banking Committee believes,
is superior to that of the task force requirement for nuanced regulation, which
would not offer any significant benefits to that of the existing
The last item I wish to comment on in terms of the organizational structure of
the sector deals with accounting for business combinations.
Currently, Canada and the United States treat goodwill differently when it
comes to business acquisitions and takeovers. The Americans use the
pooling-of-interest method, whereby goodwill is not recognized on the
purchaser's balance sheet. Canadian accounting rules use the purchase method,
whereby the goodwill associated with the combination is valued and is set up
as an asset on the balance sheet of the purchaser and is amortized over its
useful life. This puts Canadian firms at a competitive disadvantage since share
values are determined, at least in part, by market perceptions of their
earnings, which, in this case, will be reduced as a result of the acquisition
The banking committee concludes that this differential accounting policy
creates a competitive inequity for Canadian financial institutions in a period
of integration and consolidation on a North American basis and supports the
MacKay task force recommendations to harmonize this different accounting
treatment by next year. It would be preferable that the Canadian Institute of
Chartered Accountants, through current negotiating channels, be successful in
achieving the Canadian accounting standard, which is more transparent and would
support more shareholder scrutiny of management's acquisition strategies.
However, failing such an agreement with the American accounting profession,
OSFI should step in and use its power to specify principles of combinations and
accounting for goodwill to the American standard as an interim solution to this
Finally, I will turn to the issue of capital gains. I will omit the reference
to capital taxes. The MacKay task force did not address the capital gains
issue. This committee did and we recommended that this burden be reduced. The
committee strongly supports enhanced borrowing opportunities for small and
medium-sized businesses, but it recognizes that, in many cases, there is a more
important need for these businesses to acquire equity investment. This is
particularly true for the increasingly numerous and important knowledge-based
The committee came to the conclusion that one such policy initiative would be
to lower the capital gains burden on all businesses, but particularly to
encourage the provision of high-equity risk investment to small business by
financial institutions and individuals.
Entrepreneurs seeking to start up or expand an enterprise will tell you that a
major obstacle is raising capital. The answer to this problem is not a
proliferation of government entities, such as the Business Development Bank of
Canada siphoning taxpayer funds to fledging businesses. Rather, what is needed
is a financial inducement for the private sector to invest in small and
The committee was told specifically at its hearings that raising the exemption
on taxable capital gains and reducing the taxation rate would help small
businesses in acquiring equity financing, particularly from successful business
people who reinvest some of the profits that they have made into smaller
Moreover, at current capital gains tax rates, there is an unfavourable risk
reward relationship in extending equity financing to small and medium-sized
businesses. Investors face the downside possibility of losing their entire
investment with limited tax benefits, while on the up side they must share a
significant portion of their return with the government. They are, therefore,
better off making investments in less risky avenues where there exists a better
risk-reward trade-off. This committee means to correct this error.
In conclusion, I believe the committee's recommendations, along with those of
the MacKay task force, constitute a balanced package of reforms that will
provide appropriate ground rules for the sector in the coming years. However, I
stress the point that these reforms be treated as a package, and that the
government not "cherry-pick" a subset of these recommendations that
would add to the regulatory burden on business.
We look forward to working with the government when it introduces legislation
to implement the reforms that the report recommends.
Hon. John B. Stewart: Honourable senators, I should like to
rise on a point of order. I do so in order to obtain some clarification as to
where we are in the business of the Senate.
As I understand it, Senator Oliver is asking the Senate to concur in or to
adopt the recommendations set forth in the committee's report. Consequently, if
we proceed and there is an affirmative vote, these recommendations will become
the recommendations of the Senate; is that correct? Is that the position in
which we find ourselves?
The Hon. the Speaker: Honourable senators, if anyone else
wishes to speak on the point of order, I would be pleased to hear them.
However, my understanding of the situation is that Senator Oliver, by agreement
of the Senate, moved the consideration of the report.
What is presently under discussion is a consideration of the report. There must
be a further motion if we are to have the adoption of the report. At the
moment, this is simply a debate on the report. Out of that may then come a
motion to adopt. At this stage, it is purely for consideration.
Senator Stewart: I appreciate that, Your Honour. It is most
On motion of Senator Oliver, for Senator Tkachuk, debate adjourned.
Response of Government to
Requests and Recommendations-Inquiry-Debate Adjourned
Hon. Douglas Roche rose pursuant to notice of February 16,
That he will call the attention of the Senate to the urgency of the Government
of Canada saying "no" to becoming involved in a U.S. missile-defence
system; and the need for the Government of Canada to contribute to peace by
implementing the 15 recommendations in the report of the Standing Committee on
Foreign Affairs and International Trade, Canada and the Nuclear Challenge:
Reducing the Political Value of Nuclear Weapons for the Twenty-first Century
He said: Honourable senators, the Senate should be aware of a development that
will profoundly alter international relations, cripple disarmament work, and
tie Canada inextricably to U.S. ill-conceived military plans. I speak of the
U.S. government's current design of a ballistic missile defence shield over
Canadians thought this problem went away when Canada refused the U.S.
invitation to participate in the strategic defence initiative known as "star
wars," in 1985. SDI was abandoned, but in the 1990s it reappeared as a
national missile defence program designed to provide for the interception of
long-range missiles targeted on the United States.
A missile defence program for North America is now being promoted, and Canada
is inexorably being drawn into the web of U.S. military, industrial, and
complex interests. This is being done without the knowledge or consent of the
Canadian Parliament and people.
The Government of Canada keeps saying, "Relax, nothing will happen for a
long time." Honourable senators, there is plenty to worry about. The time
for us to speak out against this retrograde and dangerous proposal is now.
I shall briefly outline the facts. First, discussions are now taking place
between the U.S. and Canada on a North American ballistic missile defence
system. The U.S. is on track to deploy this system in Alaska and North Dakota,
possibly by 2005, and the administration is pumping $6.6 billion into the
project. The time for Canada to decide its course of action is now, on the eve
of deployment, not later, when Canada's options will be significantly reduced.
Second, the 1994 defence white paper unfortunately opened the door to Canadian
participation, despite a 1985 Canadian government decision not to participate
in the U.S. strategic defence initiative research. SDI closed down in the early
1990s and BMD is its successor. The U.S. wants Canada involved in BMD through
Third, BMD would violate the 1972 anti-ballistic missile treaty, known as the
ABM, which forbids a nationwide missile defence system. The ABM treaty is an
essential part of nuclear arms control. It has long been recognized that
constructing such national defences, leaving aside the improbability of their
working, would spur opposing nations to develop new offensive weapons to
circumvent defence systems. Thus, the nuclear arms race would continue to
Fourth, the U.S. recognizes that BMD would violate the existing ABM, and has
suggested to Russia that the ABM be renegotiated. Russia has so far adamantly
refused, and has threatened to stall the START II process even further if BMD
is proceeded with. The Chinese government has warned that a new nuclear arms
race will break out in Asia.
Fifth, the Canadian government said in 1995 that it opposed abrogating or
weakening the ABM, calling it absolutely essential for the maintenance of
international nuclear security. In 1996, the government added:
...Canada remains firmly committed to the 1972 ABM treaty.
Sixth, the Canadian government has consistently said it will work for the
continued development of international law. To join in the process of weakening
or abrogating the ABM to satisfy the demands of the U.S. military system, which
has not lost its appetite for expansion even though the Cold War ended nearly a
decade ago, would greatly endanger Canada's credibility in arms control and
disarmament work. Canada must speak now. By signalling that Canada is open to
the idea, the Department of National Defence is encouraging the U.S. to proceed
on the assumption that Canada will be involved.
Seventh, U.S. proponents claim that the BMD will protect the continent against
the incoming missiles of rogue states.
BMD is a bad idea because it presumes a potential attacker would develop an
extremely expensive delivery technology when it could more easily and reliably
deliver a bomb in a commercial airliner or shipping container - methods a BMD
would be powerless to stop.
Honourable senators, Canadian interests in the NORAD agreement are being
compromised through U.S. action. NORAD was not meant to be a ballistic missile
defence system. Yet NORAD is being used as the instrument to jump-start U.S.
ability to fight space wars of the 21st century. U.S. military interests are
playing on fears of a ballistic missile attack on North America by some rogue
state or terrorist and have even conjured up the ludicrous spectacle of North
Korea launching a ballistic missile attack on Montreal. The U.S. ambassador to
Canada has joined in this softening-up approach to getting Canada's compliance
by references to the needs of our two countries to stick together against vague
enemies of the future.
We must realize what is happening. The U.S. is extending its military capacity
in order to be the militarily dominant nation of the 21st century and to secure
this power by a comprehensive system of surveillance and communications
technologies. Is putting such immense power in the hands of a single state in
the best interests of international peace and security? Is abrogating the ABM
treaty justified by such an inordinate quest for power? Is Canada, which
campaigned hard for a seat on the UN Security Council in order to bring forward
new ideas for peace and security, served by tying ourselves to a military
machine out of order?
The Canadian government has got to stop saying, "Don't worry; be happy."
Every month that goes by without the government speaking out firmly against
participation in a ballistic missile defence system allows the U.S. government
to interpret our silence as tacit acceptance. Then when the system is about to
be deployed, it will be too late for us to pull out. Moreover, putting $600
million of Canadian taxpayers' money into this ill-conceived venture would be
an unconscionable affront to every Canadian who needs improved health,
education and social care.
The correct answer to what BMD seeks to accomplish, namely the security of
North America, is to pursue, as called for by the International Court of
Justice, comprehensive negotiations leading to the elimination of nuclear
weapons. Significant progress in this respect has been made in recent years.
This process is now jeopardized by BMD.
As a prestigious U.S. National Academy of Science has concluded in its 1997
report entitled, "The Future of U.S. Nuclear Weapons Policy":
...deploying missile defences outside the bounds of the ABM Treaty could
greatly diminish the prospects for future reductions in nuclear weapons.
That is cautious language for what should be stated frankly: We can kiss
goodbye to nuclear disarmament if BMD proceeds. If strategic arms control
collapses, the non-proliferation treaty which Canada has always championed will
be in ruins.
Now is the time to debate this matter. Now is the time to inform the public.
Now is the time to obtain the consent of the Canadian Parliament.
Honourable senators, on the basis of my experience in personally meeting with
hundreds of informed Canadians in all 10 provinces on nuclear weapons issues, I
contend that the Canadian public opposes the madness of a missile defence
system. The Canadian government knows there is little support for this system.
Why then dally?
The government should couple its resistance to missile defence with a vigorous
implementation of the 15 recommendations in the report of the Standing Senate
Committee on Foreign Affairs and International Trade entitled "Canada and
the Nuclear Challenge: Reducing the Political Value of Nuclear Weapons For the
Twenty-First Century." This report has rightly pointed the way for Canada
to work with like-minded states in pressing the nuclear weapon states to make
an unequivocal commitment to commence negotiations leading to the elimination
of nuclear weapons. The committee wants Canada to argue within NATO for less
reliance on nuclear weapons so the way can be cleared for NATO nuclear states
to pledge no first use of nuclear weapons and to put their nuclear weapons on
That would be a positive contribution by Canada to enhancing peace and security
in the world. That is the way forward - providing confidence-building measures
and hope for the Canadian people who want an end to nuclear weapons.
On motion of Senator Prud'homme, debate adjourned.
Hon. Sharon Carstairs (Deputy Leader of the Government):
Honourable senators, before Senator Kinsella begins, I think he will go past
six o'clock. I think there is agreement on both sides not to see the clock, as
this is the final item for today.
The Hon. the Speaker: Honourable senators, is it agreed that I
do not see the clock?
Hon. Senators: Agreed.
Motion Condemning Article
Concerning Minister of Canadian Heritage Adopted
Hon. Noël A. Kinsella (Acting Deputy Leader of the
Opposition), pursuant to notice of February 16, 1999, moved:
That the Senate of Canada finds unacceptable and rejects the article and
contest dealing with a Member of Parliament as published in the February 1999
Canadian edition of
Hustler Magazine; and
That a Message be sent to the House of Commons requesting that House support
the contents of the aforementioned motion.
He said: Honourable senators, mindful of the hour of the day, I will attempt to
be brief on this motion which I trust will receive of the unanimous support of
all members of this house.
Some students of human rights have argued that the rights of freedom of the
press, freedom of expression, freedom of opinion, and the right to participate
in public affairs are the mothers of all other rights. A democracy, to be
active, makes freedom of speech the centre of its institutional agenda and the
right to participate in public affairs the engine of the practice of freedom.
History, however, has silenced women. For centuries it is men who have
governed. It is men who have spoken, written and communicated with each other.
Women had been subject to men's construction of history and their symbolic
expressions. Institutions, words, language, images and the system of
communication had an in-built prejudice in that they gave expression to the
symbolic, material world dominated by men.
Today, as we approach the third millennium, we happily see a change. Women are
at the centre in the practice of freedom and democracy and they have been
writing their own histories and communicating their own ideas. The monopoly
over language and political participation has been broken, but it is still an
uphill struggle for women in the private and public sectors of our society.
This ongoing struggle is an act of excavation, removing centuries of
assumptions and expectations by putting forward the contemporary Canadian
imperative of women's freedom of expression, especially in Parliament, free
from any fetter and, in particular, the fetter of lewd, pornographic, sexist
Hustler magazine hype.
Honourable senators, in her work entitled, Only silence will protect you:
Women, Freedom of Expression and the Language of Human Rights, the author
Jan Bauer reminds us that, in early common law, there was a type of offender
known as the common scold and the scold's bridle or brank, a cage-like device
which enclosed a woman's head and which was used on women who spoke out on
Believe it or not, honourable senators, a few centuries back, it was not
uncommon that women who spoke too much had their tongues cut out.
In today's society, of course, the "scold's bridle" is not used, but
there are other techniques or practices which diminish both the voices and
roles of women in society, as well as attitudes and customs that sustain a
climate in which it is clearly signalled to women that their main functions are
to remain silent and obey the commands of men.
Women have in the past, and today continue to reject the argument that silence
is their only protection. It is to the credit of Agnes Campbell MacPhail that
women are members of the other place, and to the credit of the women involved
in the Persons Case that the Senate of Canada now has the benefit of many
distinguished colleagues. These women in the Parliament of Canada know only too
well that throughout the ages, left to their own devices and cosy in their
solidly constructed institutions, men would not voluntarily have accorded women
the rights owed to them, whether in Parliament or outside Parliament. This is
not to attribute ill-will to anyone, but rather to speak to the reality of
systemic or institutional discrimination.
This is why, for example, a number of years ago I had the opportunity to take
the Lovelace case against Canada to the United Nations. We were thereby
able to repeal section 12(1)(b) of the Indian Act, which provided for
legislative discrimination against Indian women who married non-Indians. The
institutions are the systems through which society's function must be adapted
or changed to reflect the fact that women's experiences are different from
men's definitions of them. The rules of this place and the precedents of
Parliament, particularly the precedents of Parliament to be found in the
procedural literature, are the history of a different era and limited in
serious ways, frankly, by man's interpretations.
The Parliament of the third millennium, honourable senators, must be reflective
of the systemic and institutional change which has been occurring since Agnes
Campbell MacPhail first took her seat in Parliament. We need to recognize the
systemic nature of the traditional male interpretation, historically, of the
parliamentary rights and privileges of its members. This reliance on tradition
has the unintended effect of directly and indirectly contributing to a
devaluation of the woman parliamentarian.
Women working in public affairs in our country are targeted, and there is a
growing body of documentation that demonstrates the degree to which such
targeting caused women not to partake in public affairs or to exercise their
freedom of expression. Jan Bauer writes:
This fear is most often articulated during discussions of violence against
women generally and rape in particular. The fear not only reflects concern over
the possibility of physical retaliation but is directly linked to customs that
lead to the social exclusion, marginalization and stigmatization of women.
The Canadian Panel on Violence Against Women stated that:
Canadian women have not enjoyed freedom of expression; rather, their fear makes
them reluctant to speak out about the violence they experience. Canadian
institutions have contributed to this situation - by denying that such
violence can exist, they have supported misogyny and abuse of power.
The Hustler magazine item, in my judgment, is a classical example of
interference with women parliamentarians by making one the object of a lewd
contest. Parliament, as an institution, must not contribute to this attack on
the freedom of expression in the exercise of a woman parliamentarian's duties.
By remaining silent, Parliament would be giving silent support to misogyny and
the abuse of Parliament.
It is important that we recognize in contemporary modern terms, given our
understanding of these institutional and systemic dynamics, that this kind of
publication does interfere in a manner that is sex-specific, and that it can
interfere with women parliamentarians in a manner in which it cannot interfere
with male parliamentarians. Nevertheless, it is an interference with
parliamentarians, and that is the critical issue that speaks to my finding this
great institutional offence of this particular item.
Parliament has in the recent past been passing legislation which has drawn our
attention to the language in which the statutes have been written. Only just a
few days ago our colleague Senator Maheu, Chairman of the Standing Committee
on Privileges, Standing Rules and Orders, brought in a report that spoke to the
correction of language and was based on our understanding and sensitivity to,
and demand for, language inclusivity.
All students of human rights know that words have power, and can either do good
or harm. Women know that words can include or exclude, and that language
defines the norm. Women know that the distinctly masculine cast of much legal
language and other instruments explicitly supports the male as the norm, in
spite of the provisions that theoretically guarantee equality for all.
Honourable senators, we have in Parliament an opportunity to have the rules of
Parliament reflect a framework of parliamentary practice which would be more
representative and inclusive of women's needs and concerns. The United Nations
Convention on the Elimination of All Forms of Discrimination Against Women
defines areas in which women most often experience discrimination in both law
and in practice. We must guarantee women the right to be eligible for election
to all publicly elected bodies and appointment to all public offices on equal
terms with men. We note that they must be entitled to hold public office and
to exercise all public functions on equal terms. When women members of
Parliament are made the subject of a lewd sex competition in a manner which is
woman-specific, then there is a direct interference with the exercise of their
public functions on equal terms with men in Parliament.
Honourable senators, I could speak to many international reports and a vast
body of available literature that underscores and explains how and why
pornographic publications interfere in very specific ways with freedom and
liberty in our society. For example, Undressing the Canadian State, the
Politics of Pornography by Catherine Itzin is but one document. From that
document I will conclude with a quote in which the author writes:
The part played by pornography in the subordination of women has been
unacknowledged, underestimated or ignored. But it is part of the picture, part
of the apparatus of oppression which contributes to constructing and
maintaining the sexual subordination of women.
Honourable senators, we are not unaware of these dynamics. We do not want this
offensive occasion caused by the publication of which I speak to pass without
rising and seeking the support of all parliamentarians in this chamber and in
the other place. Parliamentarians in the Parliament of Canada, in the words of
the Speaker in his ruling the other day, must reject that kind of
presentation. It is not the Canadian way.
Hon. Sharon Carstairs (Deputy Leader of the Government):
Honourable senators, I rise today to support the motion that has been put
before the Senate by the Honourable Senator Kinsella and to offer my personal
thanks to him for so eloquently expressing some of the difficulties that women
who have chosen to enter public life have been forced to experience. I will
now be a little personal for a few minutes about what some of these experiences
I first entered public life when I was a candidate in Alberta. Senator Taylor
was then the leader back in 1975. I remember knocking on doors and being told
that I should be home looking after my children. What they did not know was
that the Liberal Party in Alberta in those days was not a very vibrant
organization and my little children were outside with me while we were
knocking on those doors because I did not want to deny myself the opportunity
of spending the time door-to-door with those children.
When I entered public life in a more serious way, when I became leader of the
Liberal Party in Manitoba in 1984, I began to experience, on a first-hand
basis, the kind of personal comments that are made about women politicians but
are not made about male politicians - some of which I could laugh at. I must
be honest. I have been told that I am living proof that Donald Duck had
offspring. Clearly, that is a comment on my voice. I can accept that my voice
is probably not the most delicate piece of vocal equipment that anyone has ever
had. Some of it is a result of family characteristics and some of it is a
result of having been raised in the Maritimes. I guess I still have that bit of
Maritime twang that goes along with it.
I also found myself quickly subjected to criticism on everything from the way I
had my hair done to the fact that I was letting it go grey and why did I not
colour it - after all, 70 per cent of all women colour their hair. What was
wrong with me? The fact that I wanted to make a personal choice about that did
not seem to be acceptable to some individuals.
I have daughters. Perhaps the saddest part of all for me was that both of them,
having witnessed what their mother experienced, are not the slightest bit
interested in entering public service. I think that is the real tragedy. I
accepted the challenge of public service because my father had been in public
service. I thought it was something that I should do at a certain stage in my
life. However, my two daughters have no interest in public service whatsoever
because of the experiences that they saw their mother go through. To me, that
is a tragic set of affairs.
There are many days when I think things are getting better and that no one else
will talk about a helium-driven voice. Yet I picked up a newspaper article just
last week and there was a reference to the Honourable Anne McLellan and her
helium-induced voice. I thought: Here we are some 15 years later and nothing
I do think, however, that some things have changed for the better. The very
fact that women now make up 31 per cent of this chamber is obviously a step in
the right direction. That there are more women in the House of Commons than
ever before is also a step in the right direction. The fact that there are more
women in legislatures across the country is also a step in the right
direction. Clearly, with all the difficulties that they know they may have to
face, they are still accepting the challenge.
Then, honourable senators, I also think things are worse. We notice and we
observe - and, quite frankly, I could not bring myself to read the article in
Hustler magazine after I saw both the headlines and the pictures - that
a minister of the Crown is used in an extraordinarily offensive way by someone
who is trying to sell a magazine. I have to believe that that degradation is
not the norm and that it is, for almost all of us, an unacceptable means of
speaking about a female person. I have to believe that the views expressed in
that magazine are minority views, not majority views. I have to believe that
things will be better for my daughters and, I hope some day, my granddaughters.
I have to believe that. To be honest with you, I could not get up and function
every day if I did not think that things were going to be better for them.
I read about the early experiences of some of our women in politics. Senator
Kinsella made reference to Agnes MacPhail. Her first battle in the House of
Commons was not her fight for the rights of those who had been imprisoned,
although that was certainly a fundamental part of her fight. Her first fight,
believe it or not, was whether or not she had the right not to wear a hat on
the floor of the House of Commons. That was the first fight that she had to go
through because women in the gallery had to wear hats. There had never been a
woman on the floor of the House of Commons. Therefore, it was assumed that she
would have to wear a hat on the floor of the House of Commons.
The first battle for Cairine Wilson, the very first woman senator in this
chamber, was what to wear to be sworn in? The ideas were that she should be
dressed in a formal evening gown in order to be sworn in to this chamber. She
decided on a business suit for the occasion and, therefore, made it a lot
easier for all of us.
I look at those kinds of fights. We fought all those fights, so they are in the
past. Other women will not have to fight those fights.
I take the entire history of women's involvement in Canadian politics and I say
to you that it is better. It will get even better. This is an aberration. We
must condemn it as such. We must insist that women enter politics on an equal
basis with males so that all views can be adequately represented in all the
legislative chambers of Canada.
Hon. Senators: Hear, hear!
Hon. Anne C. Cools: Honourable senators, I rise in support of
this motion. I would like to thank Senator Kinsella for bringing it forward.
Obviously, I will be voting for it.
I would like to thank Senator Carstairs on my side and the leadership on the
other side for supporting it. It is my hope that when the vote takes place in a
little while that it will be a unanimous vote because I think a unanimous vote
will be a fine and splendid statement for us to make.
As I said in my remarks on February 2, 1999, I supported Senator Kinsella's
question of privilege. Hustler magazine's depiction of Sheila Copps is
an offensive and vile piece of obscenity. It is unjustifiable by any defence of
freedom of the press or freedom of expression because there is no expression
and there was very little that was written. It was just an ugly and
indefensible depiction of Minister Copps.
As I said before, it was a piece of vulgarity which was aimed at achieving an
outcome. Thus, it was a piece of vulgarity with a purpose. In my opinion, that
outcome was the embarrassment of Minister Sheila Copps and the intimidation of
her political and parliamentary actions, as embodied and contained in Minister
Copps' Bill C-55.
That bill will be coming before us shortly, and at that time I plan to visit
this issue more substantially because, as we can see, the time is late and we
must be moving along today.
I re-emphasize the point that Bill C-55 is a bill of the Parliament of Canada.
It is a proceeding of the Parliament of Canada that has been impeached and
A degradation of Minister Copps is a degradation of all of us. It is a
degradation of public service. I would also add that an immorality against
Minister Copps offends all of us because it is an immorality against each and
every one of us. It is an immorality against the Parliament of Canada and
against public service.
Honourable senators, many are intimidated or impaired in the face of the
assaults that seem to be coming fast and furiously in today's community. The
assaults are coming faster than many of us can mentally process and respond to.
In this particular instance, I cannot help but feel that we are doing the right
thing, because I happen to know for a fact that Minister Copps was personally
very offended by this particular publication.
I feel privileged that, by having Senator Kinsella bring forward his initiative
and by having Senator Carstairs and myself speak to it, we are beginning to
shed some light in a huge darkness around many issues that need a lot of
In my remarks on February 2, I was trying to refer to a particular incident and
I said at that time that I was not sure if it was 1975 or 1976. According to
Hansard, the incident was on Wednesday, December 22, 1976. The issue
was a question of privilege, and the offending newspaper was The Globe and
Mail. The member of the House of Commons who was offended was none other
than the Speaker himself, James Jerome. Our former leader here, the Honourable
Allan J. MacEachen, on December 22, 1976, with the agreement of Mr. Walter
Baker, who was the House Leader of the Conservatives, and of Mr. Stanley
Knowles and Mr. Gauthier (Roberval), rose, moved, and passed, unanimously, a
motion in the House of Commons that said:
That the statement "Let it be said of James Jerome that he is not a
Speaker but a gambler who plays incredible odds for the popularity of his party"
contained in the editorial in the Globe and Mail on December 22, 1976, is a
gross libel on Mr. Speaker, and that the publication of the article is a gross
breach of the privileges of this House.
I put that on the record today so that colleagues can know that, in 1976, our
own Senator MacEachen moved a motion without debate, with unanimous consent, on
the issue of a breach of privilege.
This is an issue I plan to revisit. I do not see this Hustler
matter totally as a gender issue. I see it as even larger than the peculiar
historical aspects that have been raised. I see it profoundly in terms of
morality and ethics as they marry the definition of what is fitting in debate.
I think one of the finest things Mr. Bruce Phillips did earlier was that he
talked about tastelessness and scruples and ethics. We are now living in an era
where, in raising these issues, one is placing oneself at a certain kind of
risk of perhaps being considered old-fashioned or conservative. There is a new
language developing in this country. Conservative? I have never thought of
myself as a Conservative. It would be an interesting perception, but I do not
think of myself as a Conservative.
In any event, I thank Senator Carstairs from the bottom of my heart for
supporting us. It would be my wish that Minister Copps could know how we in
this chamber really feel about this and that we have sent a strong message to
the master pornographers in the United States of America, including Mr. Flynt,
that this type of thing will not be tolerated by the Senate of Canada.
Hon. Marcel Prud'homme: Honourable senators, I am certain that
if my colleague Senator Roche were present, he would want to take part, if only
briefly, in this debate.
I wish to support the motion by Senator Kinsella and reiterate the words of
Senator Carstairs. I knew her in Alberta and then in Manitoba.
It is a long story between Senator Carstairs and me. I spoke in one of her
classrooms, in Alberta, not in Manitoba where she became so well known. That
goes back a long time.
I want to join in what Senator Cools has also said. I share her words about
I have had a long association with Minister Copps. I ran as chairman of the
national Liberal caucus and there was no opposition. It was delayed for three
months until someone suggested to Minister Copps that she take me on. Of
course, I said, "Sheila, I will have fun. I am not running against you.
Let us fight." It was quite a fight because she is a fighter. I do not
have to explain the outcome today.
Even though I won the contest, some years later I did not hesitate to support
her. It was a very difficult situation, and I say that in front of my friend
Senator Mercier. The Montreal Liberal Saint-Denis Association was the only
non-aligned delegation for the entire convention, and we only decided in
Calgary which candidate we were going to support. Of course, our decision was
not very good for my career. We gave Sheila Copps 14 votes on the first ballot.
I want to say that publicly.
Politics has always been very important in my family. I am glad to say that my
father and mother understood independence. I can relate to what Senator
Carstairs said. It is clear in my mind, in 1944 my mother had been doing her
bit to advance the rights of women to vote, and guess what? On the same night,
on the same corner of Beaubien and Saint-Denis, my mother was on the main
stage with André Laurendeau and the Bloc populaire canadien while my
father was across the street presiding over the Liberal gathering. Many people
said to my father, "What is wrong with your wife? Can you not talk to her?
She is going against your decision?" My father said, "She fought for
the vote and now she is voting that way," and that was the end of the
Many of you know my family, and if our society would have been fair and right
for women, one of my sisters who would have been in politics before me because
I was younger than she, but that was not to be. People say a woman should help
politicians but not be politicians.
I use this opportunity to say that I have great admiration for that gutsy lady
called Sheila Copps. She is full of courage, we all know that. It is not
necessary to expand on that tonight. We may agree or disagree at times, but she
always tries to do what she thinks is best.
En passant, we should get our act together here in the Senate to decide how to
answer one of the members of the House of Commons who is viciously attacking
the Senate, because it is not helping the entirety of the Senate. Senator
Carstairs said herself that there are now 31 women in the Senate. Under Jean
Chrétien, we may have more before long, before the millennium. Is it
because women are better represented in the institution that the institution is
coming under attack now? I have to ask myself that question.
I believe reform of the Senate, like reform of the House of Commons, is a
highly debatable issue. Just because you want change, you do not need to be
vulgar about it. Change will take place.
Everywhere I go, I am proud to say that we now have 31 women in the Senate, and
we should have more. When I arrived in the House of Commons, there were two
women, and there are now 63. That is still not enough. When I arrived here 35
years ago, there was only one woman in the Senate. There are now 31.
We should continue to fight. I am sure Senator Roche wanted to support Senator
Kinsella's resolution, and I fully agree with it.
The Hon. the Speaker: If no other honourable senator wishes to
speak, I will proceed with the motion.
It was moved by the Honourable Senator Kinsella, seconded by the Honourable
That the Senate of Canada finds unacceptable and rejects the article and
contest dealing with a Member of Parliament as published in the February 1999
Canadian edition of
Hustler Magazine; and
That a Message be sent to the House of Commons requesting that House support
the contents of the aforementioned motion.
Is it your pleasure, honourable senators, to adopt the motion?
Motion agreed to.
Leave having been given to revert to Government Notices of Motions:
Hon. Sharon Carstairs (Deputy Leader of the Government):
Honourable senators, with leave of the Senate and notwithstanding rule 58(1)(
That when the Senate adjourns today, it do stand adjourned until Tuesday, March
2, 1999, at 2 p.m.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
Motion agreed to.
The Senate adjourned until Tuesday, March 2, 1999, at 2 p.m.