Debates of the Senate (Hansard)
3rd Session, 40th Parliament,
Volume 147, Issue 57
Wednesday, October 20, 2010
Donald H. Oliver,
Wednesday, October 20, 2010
The Senate met at 1:30 p.m., the Speaker pro tempore in the chair.
Hon. Elizabeth Hubley: Honourable senators, every year approximately
37,000 young Canadians participate in the Duke of Edinburgh Awards. Founded in
1956 by His Royal Highness the Duke of Edinburgh, the awards encourage youth to
be active and challenge themselves in four areas: community service, skills,
physical recreation and adventurous journey. By setting and achieving goals,
participants can earn bronze, silver and gold awards.
This year for the first time in Prince Edward Island, 13 Aboriginal youth
participated in the awards.
I offer my congratulations on earning their bronze level awards to Amethyst
Knockwood, Alisha Knockwood, Dion Bernard, Melissa Peter Paul and Joseph
Schurman Peters from the Abegweit First Nation; Denise Bernard, Dustin Bernard
and Brett Bernard from the Lennox Island First Nation; and Ebony Larkin, Bradley
Cooper, Dana Panchuk and Chance Banks of the Native Council of Prince Edward
These youth earned their award by participating in the Mawita'jik program. A
project of the Aboriginal Women's Association of Prince Edward Island, this
program works with Aboriginal youth, both on and off reserve, to help them
explore their potential.
By partnering with the Duke of Edinburgh Awards, these young people were
given a new opportunity to challenge themselves. I wish them every success in
pursuing their silver award.
Hon. Stephen Greene: Honourable senators, I rise today to praise the
government's position on the long-form census. I praise the government's policy
because I am a victim of the census police.
First, I am not one who takes to the filling out of forms easily. Therefore,
when the last census arrived in its incredibly long form, I put it to one side.
The one thing that saved it from the trash was that it was the census from my
There it sat for two, four, six — I do not know how many weeks. Then I
received a letter reminding me to fill out the census form. The census form —
where did I put that? I went through the first two or three pages and became
more and more amazed and concerned at the kinds of questions I was being asked
and their incredible detail. I thought about tossing the form in the trash but I
put it to one side again.
A few weeks later, I received a telephone call from Statistics Canada
reminding me about the census and informing me that I could face jail time if I
did not fill out the form. I thought the person was nuts or having a bad day but
obviously exceeding her authority. In any event, I made allowances for her
craziness and dutifully went back to the form.
After looking through the form again, I decided not to answer all the
questions. I felt that some of them were too personal, or at least some were not
the business of my government to ask, so I signed the bottom of the form and
sent it back.
A few weeks later, I received a notice that there was a registered letter for
me at the post office. I had no clue why someone would send me a registered
letter but registered letters are always bad news, so I worried about it. The
letter was strongly worded and threatened me with jail time if I did not return
a completed census. Included in the envelope was my partially completed census.
Honourable senators, I was mad. What kind of country was I living in that
would make me a criminal for not filling in a government form? Frankly, thinking
about this letter still infuriates me. Did this letter mean the government has a
licence to ask me anything it wanted, and could throw me in jail if I chose not
to answer? All I knew at that point was that I would not fill out that form.
When I arrived home, I asked my daughter, a teenager at the time, to fill out
the form as a kind of game or project, and to make up any answers she did not
know. She did so. I sent off the form and I did not hear from the census police
No one was happier than I with my government's new policy on the long-form
census. The rights of individual Canadians are more important than the
government's need for information.
Hon. Mobina S. B. Jaffer: Honourable senators, I rise today to speak
on the importance of embracing difference. On Friday, October 15, I had the
privilege of attending the tenth annual LaFontaine-Baldwin Symposium. This event
was founded by our former Governor General, the Right Honourable Adrienne
Clarkson, and is co-chaired by Mr. John Ralston Saul.
This year, the symposium attendees warmly welcomed His Highness Prince Karim
Aga Khan who delivered an inspiring speech on the topic of pluralism. In his
lecture, His Highness spoke about the Global Centre for Pluralism, which has
been established in partnership with the Government of Canada. He explained that
this centre is one of the first institutions dedicated to tackling the question
of diversity and pluralism in our world.
The Aga Khan went on to state that Canada was a natural home for this
institution, given that Canada is particularly well versed in the importance of
embracing difference and has an international reputation of perceiving diversity
as a strength rather than a weakness.
Honourable senators, throughout my life in Canada, I have learned that it
does not matter if someone is black or white; if they speak English, Italian or
Punjabi; or if they worship in a church, mosque or synagogue. Being different
does not hinder the ability to flourish in Canada.
I have never been more proud to be a Canadian than last Friday evening. I was
especially inspired after hearing the Aga Khan state:
What the Canadian experience suggests to me is that identity itself can
be pluralistic. Honouring one's own identity need not mean rejecting others.
One can embrace an ethnic or religious heritage, while also sharing a sense
of national or regional pride.
As a woman of Indian origin, Ismaili Muslim faith, who was born and raised in
Africa and who sought refuge in Canada, I have found great comfort in these wise
words. Regardless of my complex identity, I have not only been granted the
honour of identifying myself as a Canadian, but I have also been given the
privilege of rising before all honourable senators today and representing my
community and my province of British Columbia.
Honourable senators, the Aga Khan in his speech indicated:
Pluralism is a process and not a product. It is a mentality, a way of
looking at a diverse and changing world.
It is important for Canadians to acknowledge that although being home to the
Global Centre for Pluralism is a source of great pride, it also brings great
responsibility. We now have an obligation to show the rest of the world that
embracing difference can help foster a better life for all.
I congratulate the Right Honourable Adrienne Clarkson and Mr. John Ralston
Saul for making this year's symposium a great success. However, most important,
I congratulate all Canadians for showcasing to the world that, as the Aga Khan
said in his speech, "diversity has the capacity to inspire."
Hon. Yonah Martin: Honourable senators, this week we celebrate
Canada's Citizenship Week. Canada is a unique place not only for its natural raw
beauty but also for its diverse communities and people. From this diversity, we
learn what it means to be Canadian. It is not only a right; it is a privilege to
say, "I am Canadian." Some people may take the privilege for granted, but most
hold a Canadian passport with pride and in extremely high regard.
Canadians are recognized around the world as tolerant, open-minded people,
and Canada stands as a model of multiculturalism. Many Canadians have family and
friends in other countries. We may travel or live abroad for a while, but one
thing is certain: there is no better place than our home, Canada.
I am proud to carry a Canadian passport and to be a citizen of our great
Those fortunate enough to be born and raised in Canada, who know Canada as
their only home, may not at times see Canada in its full splendour and beauty.
However, new Canadians who fled to Canada from tyrannical regimes, or, like my
parents, left in search of a more just society and greater opportunities for
their children, treasure their new home and their new citizenship. They know
that this privilege comes with responsibilities and freedoms they were not
allowed to have in their countries of origin.
How can we show our appreciation for being Canadian? How can we strengthen
Honourable senators, what can each of us do this week and beyond? During this
week, we can attend a citizenship ceremony in our community or perhaps host a
reaffirmation ceremony. I encourage honourable senators to pick up a copy of the
booklet entitled Discover Canada: The Rights and Responsibilities of
Citizenship, or read it online if they have not done so already. It is a
useful booklet for those preparing to become a new Canadian, and a worthwhile
read for all Canadians.
Perhaps honourable senators may want to demonstrate Canadian hospitality by
hosting a newcomer or visitor to our country. They may want to join a community
host program, be a local guide and share ideas on what it means to be a
Canadian. Those are only a few ideas to consider to become involved.
By participating and showing our genuine warmth and openness, people will
learn and understand more about what it means to be Canadian. This special event
does not stop at the end of this week but carries on during the entire year.
Being a Canadian citizen is a year-long privilege and responsibility. This week
is set aside to remind us not to forget our rights and responsibilities, our
freedoms and privileges to be Canadian.
Hon. Claudette Tardif (Deputy Leader of the Opposition): Honourable
senators, I rise today to draw your attention to student concerns regarding
post-secondary education in Canada.
On October 6, I had the privilege of meeting with two representatives from
the Canadian Federation of Students, Michael Olsen of British Columbia and Katie
Haig-Anderson of Manitoba.
During our meeting, the students shared with me the content of their report
entitled Public Education for the Public Good.
The report focuses on issues pertaining to post-secondary education in
Canada, such as the increasing debt load of students, the lack of a national
strategy on education and the need for strong leadership and commitments from
the federal government.
The report also details five key recommendations that the Canadian Federation
of Students wishes to convey to the current government. The recommendations are
the following: develop and implement a national vision for a high-quality and
affordable system of post-secondary education; track success and measure results
by increasing funding by $10 million to Statistics Canada's branch for the
collection and analysis of post-secondary education statistics; reduce student
debt by increasing the value and number of non-repayable grants available to
students and by redirecting funds allocated to education-related tax credits and
savings schemes to the Canada Student Grants Program, and allow graduate
students to qualify for grants under the program; meet Canada's obligations to
fund Aboriginal education by removing the funding cap on increases to the
Post-Secondary Student Support Program, and by ensuring that every eligible
First Nations and Inuit learner is provided adequate funding to attend
post-secondary education; and foster innovation by increasing the number of
Canada Graduate Scholarships to 3,000 and distribute the funding proportionately
among the research councils according to enrolment figures.
Honourable senators, I believe we ought to consider seriously the
recommendations of the Canadian Federation of Students to strengthen
post-secondary education in Canada to meet the needs of the students and to be
more competitive on the world stage.
Hon. Dennis Glen Patterson: Honourable senators, I rise to draw your
attention to progress being made by the Inuit of Canada in challenging the
European Union in court. This August when the Senate was not in session, Inuit
welcomed a decision of the European Court on August 19 that decided to suspend,
pending further judicial deliberation, a proposed ban on the import of seal
products to the European Union, which had been scheduled to come into effect the
Honourable senators, Inuit — leading a coalition of Inuit and East Coast
sealing plaintiffs — are taking on the EU, and intend to demonstrate that the
proposed ban runs counter to their own European laws, as indicated by their own
When the EU court issued its ruling on August 19, national Inuit leader Mary
Simon stated at the time:
I would hope that the European Parliament would see fit at this stage to
do the right thing and withdraw its legislation.
The proposed EU ban is poorly founded in fact, law or reason, pandering to
myth and half-truth, and steeped in political hypocrisy and cynicism.
The proposed ban purports to offer Inuit some kind of exemption designed by
EU officials to salve the European consciences with precious little grasp of the
social, economic and cultural realities for Inuit. The exemption is based on
past record and current appearances — an empty box.
It is also important to note that the Government of Canada has already lodged
a complaint against the seal ban under the World Trade Organization rules. The
Inuit lawsuit and the federal government's current WTO action not only are
entirely compatible, they are also mutually supportive and beneficial.
We must be mindful that the EU is currently lobbying Arctic states, including
Canada, to increase the EU's influence in the circumpolar Arctic. Honourable
senators, so long as the European Parliament sees fit to ban Canadian seal
products, and in so doing, by extension, to destroy a way of life and livelihood
for many Inuit, I believe that the Canadian government and this chamber should
resist any further involvement of the EU in Canadian Arctic affairs. I call upon
all senators, other parliamentarians and the Government of Canada to offer their
full support for this timely and courageous stance by the Inuit of Canada.
Hon. Gerald J. Comeau (Deputy Leader of the Government): Honourable
senators, I have the honour to table, in both official languages, the 2009-10
annual report of the Mental Health Commission of Canada, entitled On Our Way.
Hon. Gerald J. Comeau (Deputy Leader of the Government): Honourable
senators, I have the honour to table, in both official languages, the government
response to the third report of the Standing Senate Committee on Aboriginal
Peoples, entitled First Nations Elections: The Choice is Inherently Theirs.
Hon. Gerald J. Comeau (Deputy Leader of the Government) presented Bill
S-12, A third Act to harmonize federal law with the civil law of Quebec and to
amend certain Acts in order to ensure that each language version takes into
account the common law and the civil law.
(Bill read first time.)
The Hon. the Speaker pro tempore: Honourable senators,
when shall this bill be read the second time?
(On motion of Senator Comeau, bill placed on the Orders of the Day for second
reading two days hence.)
Hon. Jane Cordy: Honourable senators, I have the honour to table, in
both official languages, the report of the Canadian parliamentary delegation of
the Canadian NATO Parliamentary Association to the Visit of the Science and
Technology Committee, held in New York, Norfolk and Washington, D.C., United
States of America, from May 3 to 6, 2010.
Hon. Jane Cordy: Honourable senators, I have the honour to table, in
both official languages, the report of the Canadian parliamentary delegation of
the Canadian NATO Parliamentary Association to the Spring Session 2010, held in
Riga, Latvia, from May 28 to June 1, 2010.
Hon. Jane Cordy: Honourable senators, I have the honour to table, in
both official languages, the report of the Canadian parliamentary delegation of
the Canadian NATO Parliamentary Association to the Committee on the Civil
Dimension of Security and the Sub-Committee on Transatlantic Relations, held in
Missouri and Washington, D.C., United States of America, from July 9 to 14,
Hon. Mac Harb: Honourable senators, I have the honour to table, in
both official languages, the report of the Canadian delegation of the
Inter-Parliamentary Union to the 21st session of the Steering Committee of the
Parliamentary Conference on the World Trade Organization, held in Geneva,
Switzerland, from June 24 to 25, 2010.
Hon. James S. Cowan (Leader of the Opposition): Honourable senators,
today is World Statistics Day, proclaimed by the United Nations General Assembly
to recognize the importance of statistics in shaping our societies by enabling
governments, businesses and communities to make good decisions and policies for
The Secretary-General of the United Nations calls statistics "a vital tool
for economic and social development." However, Canadians sadly find themselves
shut out of the international community once again. Instead of supporting the
use of reliable statistics for Canadians, the Harper government has abandoned
statisticians and policy-makers with their senseless abandonment of the
In fact, the Statistical Society of Canada is marking World Statistics Day
with an online video of a mock funeral for the mandatory long-form census.
In light of this international acknowledgement of the crucial importance of
statistics in policy-making, will the leader admit, once and for all, that this
decision was not made in the best interests of Canadians, that it was simply a
bad decision, and agree to reinstate the mandatory long-form census?
Hon. Marjory LeBreton (Leader of the Government): I thank the
honourable senator for the question. I will absolutely not agree with what he
has just said. As I reported in the Senate several times in answers to questions
in the last few weeks, Statistics Canada does incredibly good work, gathering
information on many fronts. I think they have done 80 surveys that are all
voluntary. There is no evidence — in fact just the opposite — that this
information, because it was voluntary, is somehow or other less valid.
We have a mandatory census that will be distributed. Three questions were
added to it to meet the needs of the Official Languages Act. Nothing else has
changed. The same long form will be distributed to Canadians with the same
number of questions.
There are two differences. It will be more widely distributed, and we are
asking Canadians to fill out this form in the interest of having data that
complies with the rest of Statistics Canada. The only other difference is that
we are asking Canadians nicely to fill out the form. We have every reason to
believe that Canadians will, and we are not demanding that they fill it out
under threat of registered letter and further harassment, as my colleague said a
few minutes ago, and, in fact, jail terms.
Senator Cowan: Statistics Canada, to whom the leader referred in
response to my last question, has issued repeated warnings over the last couple
of days about bias and sampling errors that will occur in this census should her
government insist on proceeding with the abolition of the mandatory long-form
Instead of the 94 per cent response rate which was achieved in 2006,
Statistics Canada warned last week on their website that it expects only a 50
per cent response rate to the new voluntary National Household Survey. This
adjustment from 94 per cent to 50 per cent takes into account the planned
increase in the sampling amount that she has referred to and the sampling size,
and also the $30 million that this government is spending to advertise its new
form of household survey. It has adjusted for those two figures.
Statistics Canada tells us that this will lead to a serious risk in what they
call a non-response bias. In their words, "the results are not representative of
the true population."
The bottom line is what experts have been warning this government about for
months, namely that this new household survey will produce skewed and unreliable
or less reliable results. The leader has repeatedly told us, and told me on a
number of occasions, that she is confident that Canadians will fill out the form
voluntarily and that we will get even more people responding than was the case
The leader is alone in that belief. The experts — the people at Statistics
Canada, people who are working on behalf of provincial and municipal
governments, on behalf of non-governmental agencies, and on behalf of charities
from coast to coast to coast — disagree with her position. They clearly do not
share her sense of confidence.
Statistics Canada, for the first time, has sided themselves not with the
leader and her government, but with the people who have already criticized the
decision the government has taken. Will she finally admit the mistake and
reinstate this much needed long-form census?
Senator LeBreton: I am a great believer in people having the right to
their opinions. I happen to disagree with what the honourable senator has said.
I repeat — and I believe I speak for a great number of people — that I have
great confidence in the people of Canada that when they receive the household
survey, they will fill it out honestly and fairly, and not as was the case my
colleague mentioned earlier and not as was my own experience which I have
mentioned. I have every confidence in the good citizenship and good intentions
of fellow Canadian citizens.
I read in this morning's newspaper about what the honourable senator referred
to. Let us trust the Canadian people and hear what they have to say about it
before we jump to conclusions or prejudge a result that everyone is simply
assuming. I continue to have great confidence in the Canadian public. I believe
that many people support what the government has done, as we have sought
fairness and balance. I repeat: I have great faith in the honesty and decency of
my fellow citizens.
Senator Cowan: Honourable senators, let us take this a little further.
Let us assume that Statistics Canada is correct. Let us assume that the leader's
optimism is ill-founded. Let us find, when this has concluded, that the response
is not greater than 94 per cent, which is what the honourable senator is
expecting, but is somewhat closer to the 50 per cent that Statistics Canada is
planning. What will the leader do then?
Senator LeBreton: I am one of those people who used to preach to my
fellow workers not to assume anything. We know the old saying: Do not assume,
because if you do, you will make an ass out of you and me. I do not think that I
will answer questions based on assumptions.
The Hon. the Speaker pro tempore: Honourable senators, I
wish to draw your attention to the presence in the gallery of our distinguished
former colleague, Senator Trenholme Counsell.
On behalf of all honourable senators, welcome back to the Senate.
Hon. Senators: Hear, hear.
Hon. Marie-P. Poulin: Honourable senators, I would like to continue in
the same vein as Senator Cowan.
The distinguished Leader of the Government in the Senate just told us that
she believes Canadians will voluntarily complete the long-form questionnaire
sent out by Statistics Canada.
We know how important objective, factual, current information is to the men
and women who have to make major decisions that will have an impact not only on
legislation, but also on Canada's large corporations and small and medium-sized
I would like to know how the government reacted when the former Governor of
the Bank of Canada, David Dodge, and four former Clerks of the Privy Council
urged the Prime Minister and the Conservative government to reverse their
decision, because this information is vital to the country's economic, social
and cultural future.
Hon. Marjory LeBreton (Leader of the Government): Honourable senators,
as I reported in the Senate, the Governor of the Bank of Canada met with the
Honourable Tony Clement, Minister of Industry, who is confident they can work
together to deal with the concerns expressed by the Governor of the Bank of
I repeat and will continue to repeat that the government does not believe
that Canadians should be threatened with fines, jail times and registered
letters should they decide that this form is an invasion of their privacy and
that the questions are overly intrusive. That is why we will continue to have a
long-form questionnaire known as the National Household Survey. It will contain
the same number of questions and will be more widely distributed. We believe
that this is a fair and reasonable approach to find a better balance between
collecting data while protecting the privacy of Canadians. All information
gathered on the short-form mandatory census, including questions to satisfy the
Official Languages Act, will also be helpful. As the honourable senator cited,
other agencies and bodies rely on the data and material. They also rely on data
and material collected from various other sources, including the 80 or 90
surveys done on a voluntary basis by Statistics Canada.
Hon. Claudette Tardif (Deputy Leader of the Opposition): Honourable
senators, we learned last week that long- and short-form questionnaires were
distributed to some 110,000 suburban households in Montreal, Quebec City and Red
Deer in May 2009. The purpose of this exercise, which cost over $1 million, was
to test the 2011 census mechanism. In fact, everything was in place just one
month before the Conservative government decided to do away with the mandatory
Can the Leader of the Government in the Senate tell us about this test, which
cost over $1 million, and share the results?
Senator LeBreton: Honourable senators, I do not have that information,
as the honourable senator quite rightly knows. This government believes that the
long-form mandatory census was an invasion of Canadians' privacy. It asked
overly intrusive personal questions. Statistics Canada is free to ask Canadians
those questions, but this government believes that Canadians should respond to
those questions on a voluntary basis and should not have to do it under threat
of further actions by the government for refusing to answer questions that they
deem to be an invasion of their privacy and overly intrusive.
The long-form household survey, as I have said many times before, has the
same number of questions. Honourable senators can get over that because they
know we have a long-form survey. The only difference is that we trust Canadians
to fill out the forms accurately. We do not demand that they fill them out. As
we know from many examples, Canadians used other means to answer them when they
were under threat.
Hon. Jean-Claude Rivest: Honourable senators, you know that Statistics
Canada has always maintained a relationship with statistics bureaus in the
various provincial and territorial jurisdictions. Before making this unfortunate
decision, did the Canadian government consult with the provincial governments,
which have statistics bureaus, in order to assess the consequences the
government's decision will have on the quality of research and on the results
that will be obtained, not only at the federal level, but also for all the
statistics bureaus in other jurisdictions in Canada?
Senator LeBreton: Honourable senators, Statistics Canada is an agency
of the federal government and this is a decision for the federal government.
People can quarrel with the decision, but the government is completely within
its rights and the law to set the policy.
Hon. Jane Cordy: Honourable senators, my question is for the Leader of
the Government in the Senate. Will the government remove the threat of prison
for not completing the short form?
Senator LeBreton: Honourable senators, nothing has changed with regard
to the mandatory short-form census because it is sent to every household in
Canada. The long form is not a census. It was always just a survey. It is a
misnomer to call it a census, because only approximately 20 per cent of Canadian
households received it.
We support the mandatory short-form census. What used to be called the
mandatory long-form census was misnamed; it was a survey.
The Canadian public will continue to have the right to fill out the long-form
census, those 60-odd pages with the intrusive questions that invade privacy, but
we are asking them to do so, because we trust Canadians to fill it out honestly.
We are not demanding that they fill it out, as the previous government did.
Senator Cordy: Will the threat of prison remain for Canadians who do
not fill out the short-form census?
Senator LeBreton: Honourable senators, we did not change any of the
requirements for the mandatory short-form census. That is a completely different
issue. Senator Greene was talking about the long-form census. As the honourable
senator knows, that is a completely different issue.
Senator Comeau: It is like income tax.
Senator LeBreton: That is correct; it is like income tax.
The mandatory short-form census is actually a census that is sent to every
Canadian household. It collects information on language, population growth and
origins that is very valuable to the government.
Senator Mitchell: Oh, oh!
Senator LeBreton: Senator Mitchell, the mandatory short form is a
census. The long form was never a census; it was a survey, and we are properly
Hon. Céline Hervieux-Payette: Honourable senators, I would like to
make a suggestion to the leader that might be helpful and that respects
individuals' rights. I regularly fill out forms that take a great deal of my
time. I do so to make sure we are buying good-quality products. Generally
speaking, I am offered a prize for my troubles.
What prize should your government offer to Canadians who voluntarily
participate? I would suggest a trip to the pool that you built for the G20,
where they can go boating or spend a weekend with the opposition leader. In any
event, there needs to be an incentive.
We have to trust Canadians. I can tell you one thing: this is a public duty.
Canadians are not doing us a favour. They are doing this for other citizens. I
fill out forms voluntarily and sometimes I receive samples of soap. I am simply
trying to point out that by using the word "voluntary" and talking about a
person's choice, you are suggesting that you do not believe that Canadians will
carry out a public duty for the good of everyone and to allow us to plan
federal, provincial and municipal policies.
For that matter, Madam leader, the short-form census could be just as much an
invasion of privacy by virtue of the fact that people are forced to fill it out.
I am not buying this theory. I am trying to help you with your theory of
volunteerism. Would the leader agree to find an incentive to make volunteers
Senator LeBreton: The honourable senator just made my point. Senator
Hervieux-Payette fills out surveys all the time on a voluntary basis. Trust a
Liberal to look for an incentive to do anything.
We have all filled out the mandatory short-form census. It collects important
statistics with regard to where our people live, population growth, language
issues, et cetera. I do not think Canadians have to be offered an incentive to
fill out a form. As I have said many times, I have great faith that Canadians
will fill out the household survey when it goes out with a wider distribution
base. It has the same number of questions as the previous mandatory long-form
census, which should not have been called a census.
Senator Hervieux-Payette made my point. Canadians are more than willing to
fill out surveys, and I am sure that they will be even more willing when they
are asked nicely to fill out this survey rather than being told to do so.
Hon. Lillian Eva Dyck: Honourable senators, my question is for the
Leader of the Government in the Senate.
On March 4, 2010, Finance Minister Jim Flaherty announced that the Government
of Canada had promised $10 million to help address the human crisis in Canada
concerning missing and murdered Aboriginal women. Honourable senators, it has
been seven months since that announcement and honourable senators may be shocked
to learn that none of the funding promised to address this national problem has
been disbursed. Families of missing Aboriginal women have been waiting, living
with pain and immense grief. They have been waiting far too long for government
Can the Leader of the Government in the Senate tell this chamber when the
money promised for missing and murdered Aboriginal women will finally be
disbursed so that Aboriginal families and communities will no longer have to
live quietly in suffering?
Hon. Marjory LeBreton (Leader of the Government): Honourable senators,
Senator Dyck is quite right; this is a very sad situation, which is why Budget
2010 committed to investing $10 million to address this problem. I believe this
is the first time a government has ever made that kind of a commitment.
The Minister of Justice has been meeting with various sectors across the
country including provincial and territorial justice systems, public safety
agencies, policing and women's and Aboriginal groups.
I will be very happy to get an update from the Minister of Justice and the
Minister of Indian and Northern Affairs on the status of this very serious file.
Senator Dyck: I thank the leader for that answer.
Native women's organizations are concerned that, if and when the money is
finally disbursed, they will be unfairly put into a race against the clock
because seven months of this fiscal year have already elapsed. They fear that if
money is not spent within the fiscal year, the unspent money will have to be
returned to the government.
Can the Leader of the Government in the Senate assure us that there will be a
fair time allotment process so that recipient organizations or communities can
continue to do their important work without fear that the rug may be pulled out
from under them with regard to their funding?
Senator LeBreton: I wish to assure the honourable senator that those
fears are unfounded. This was part of the budget process. The government is firm
with its commitment.
Interestingly, the budget was strenuously opposed by the opposition in the
other place and it took some time to get it through here as well.
When Senator Dyck is speaking with Aboriginal women's groups on this serious
issue, I urge her to inform the groups that the government is extremely
committed to disbursing these funds to help resolve this serious situation.
Senator Dyck: On April 21 of this year, Honourable Senator Lovelace
Nicholas asked a question of the Leader of the Government about funding to the
Native Women's Association of Canada with regard to the Sisters in Spirit
initiative which was researching the issue of missing and murdered Aboriginal
women. At the time, the leader responded by saying:
The prudent way to proceed is to put some of this money to use in the
communities and to work with our Aboriginal partners to resolve these
matters, rather than to study what is known to be a terrible tragedy.
In other words, the leader said the government was tired of conducting
research and wanted to do something active; they wanted to take action. It has
been seven months and we do not see any action.
Which communities will be helped out with the promised funding? By the way, I
am not in any way promoting fear-mongering with any of these organizations; I am
simply trying to obtain answers.
Senator LeBreton: I absolutely understand and appreciate the
honourable senator's motives and I do not question them for a moment, because
she has worked extremely hard on these serious issues.
My words to our colleague, Senator Lovelace Nicholas, have not changed. I
agree that there is only so much study that can be undertaken on a problem.
There needs to be expenditure of funds to solve some of these problems.
I committed to the honourable senator in my last answer to obtain up-to-date
information, because I know that my colleagues have been working on this serious
issue on many fronts. I indicated to Senator Dyck that I will be happy to
provide a full update for her as to what actions have been taken in the various
communities, and what the various provincial and territorial governments have
committed to. I will provide that update by written response.
Hon. Rose-Marie Losier-Cool: Honourable senators, my question is for
the Leader of the Government in the Senate. We are all familiar with the
disturbing statistics. Not a week goes by without reports in the media about
some form of violence against women: rape, spousal abuse, murder and other
On November 25, 2008, the other place unanimously passed a motion to develop
a violence prevention strategy to end violence against women.
Can the Leader of the Government tell us if her government has abided by the
motion and developed such a strategy?
Hon. Marjory LeBreton (Leader of the Government): Honourable senators,
it is obvious that violence against women is something that must not be
tolerated ever. As I responded in the previous question, I can say only that the
government, through our increased funding of money to combat violence against
women in the Aboriginal community, has increased incredibly the amount of money
expended through Status of Women Canada — money that is distributed into the
Obviously, with the news we have been living with for the last little while,
no person in their right mind would stand up and say that they would not support
doing everything possible to end the scourge of violence against women.
The Hon. the Speaker pro tempore: Honourable senators, I
draw your attention to the presence in the gallery of the participants of the
eighth Canadian Parliamentary Seminar.
On behalf of all honourable senators, I welcome you to the Senate of Canada.
Hon. Senators: Hear, hear.
On the Order:
Resuming debate on the motion of the Honourable Senator Brown, seconded
by the Honourable Senator Runciman, for the second reading of Bill S-8, An
Act respecting the selection of senators.
Hon. Serge Joyal: Honourable senators, in the past four years, the
government has introduced four different bills involving Senate reform, either
in the Senate or the other place, which have dealt with either the length of
term or the election of senators: Bill S-4 and Bill C-43 in 2006; Bill C-19 in
2007; and Bill S-7 in 2009. They all died on the Order Paper.
A fifth bill dealing with senators' tenure, Bill C-10, was introduced in the
House of Commons on March 29 and is currently at second reading in the other
place. Still a sixth one, Bill S-8, was introduced in the Senate on April 27,
and establishes a scheme for the election of senators. The constitutionality of
all six of these bills, based on section 44 of the Constitution, has been
questioned by a large group of constitutional experts and scholars from
universities across the country.
At least four provinces — Ontario, Quebec, New Brunswick, and Newfoundland
and Labrador — have sent extensive briefs to the Senate supporting their common
position, which is that any change that would alter the fundamental
characteristics and nature of the Senate, and would impair its independence in
providing sober second thought to legislation, is a constitutional amendment
that requires the formal concurrence of the provinces under the 7/50 amending
In view of this overwhelming testimony, the Standing Senate Committee on
Legal and Constitutional Affairs recommended, with respect to Bill S-4 in 2007,
that the question be referred to the Supreme Court for a ruling to determine the
constitutional right of the Parliament of Canada to proceed with such a
fundamental change. The government, however, refused. This refusal was despite
the fact that the government has recently decided to refer the issue of its
capacity to establish a national security commission to the Supreme Court for a
ruling considering the clear opposition of Quebec and Alberta, and of
reservations by Manitoba and British Columbia. The government seems to be of the
opinion that it is important, if not essential, to clarify the jurisdiction
issue for the stability of the stock market, but it does not think that the
certainty of the legislative process in which the Senate plays an integral and
essential role should be guaranteed. The issue is not a trivial one. If a change
is made to the status of the Senate without the appropriate legal process, the
validity of any legislation adopted by such an altered Senate will be null and
void. This effect is no small matter.
The Canadian government chose to introduce this bill without any in-depth
study or reflection on the introduction. Each of the bills introduced
successively by the Canadian government were modified without any explanatory
paper that demonstrated a convincing reflection on the role of Parliament and
the role of its components.
Bill S-8, which is under discussion, is a strange if not bizarre legislative
creature. In my opinion, Bill S-8 is a totally ultra vires bill and is invalid
on at least three counts.
First, Bill S-8 is in open conflict with section 42 of the Constitution,
which provides that "the method of selecting senators" falls under the 7/50
amending formula. In other words, it is not up to the Parliament of Canada,
acting alone, to make changes that affect "the method of selecting senators."
The second count of invalidity centres on the long-recognized constitutional
principle that the federal Parliament cannot delegate powers to the provinces.
Each legislative authority is sovereign in its exclusive field of jurisdiction.
This principle, in fact, is at the core of our federal structure of government.
The third count of invalidity contends that the legislature of a province
cannot usurp or legislate in a field or domain of competence that is not
allocated to it. In other words, a provincial legislature cannot act in areas
that are clearly under the competence of the federal government or Parliament.
Each of these three counts of invalidity is substantive. Each needs to be
more fully explained.
First objection is that Bill S-8 aims to change "the method of selecting
senators" through provincial elections. Bill S-8 does not propose, as did its
predecessor, Bill C-43, to select senators following a federal election under
the supervision and responsibility of the federal Chief Electoral Officer, with
financing rules based on those similar to the election of members of the other
place. Rather than producing a federal electoral process, Bill S-8 has turned
the tables around. It now assigns the whole electoral process to the provincial
legislature and its lieutenant governor.
Bill S-8 contains three "whereas" clauses and three other short clauses
relating to the federal government, not more than one page, while the bulk of
its 51 provisions outline the electoral processes that the provinces must adopt
for the election of candidates to Senate seats. Those provisions are entitled
"Framework For The Selection Of Senators."
However, before going into further detail regarding that framework to elect
senators, the first question is does Parliament have the power to enact that
kind of framework for the election of senators?
The Constitution provides a clear answer to that question and so does the
Supreme Court ruling of 1979 known as the Senate reference.
Honourable senators, section 42 of the Constitution states quite clearly that
the powers of the Senate and the method of selecting senators may be made only
in accordance with the 7/50 amending formula.
The title of Bill S-8 is clear on its substance: "An Act respecting the
selection of senators" and in French, "Loi concernant la sélection des
The bill does not hide its intent to provide for a different selection
process for candidates to the Senate. As its summary states, it establishes ". .
. a framework for electing nominees for Senate appointments . . ." Moreover, the
bill establishes a statutory obligation for the Prime Minister to consider the
elected nominees. The summary provides:
. . . the Prime Minister, in recommending Senate nominees . . . would be
required to consider names from a list of nominees submitted by the
provincial or territorial government . . .
The last section of the bill, section 3, states it more forcefully:
. . . the Prime Minister . . . must consider names from the most current
list of provincial nominees elected . . .
It would not be up to the Prime Minister to look at that list and set it
aside to pick nominees of his or her own choice. According to Bill S-8, on the
basis of the electoral framework provided in the bill and implemented by a
province or territory, the Prime Minister has a clear statutory obligation. The
Prime Minister must consider those names. The courts have interpreted the word
"must" in statute law. If the process provided in any act is followed in its
entirety, the obligation that ensues is conclusive. In the opinion of the court,
the word "must" is a common imperative. "It expresses command, obligation, duty,
necessity and inevitability."
There is no doubt that Bill S-8 proposes a radical departure from the current
practice whereby the Prime Minister has sole discretion in submitting any name
for summons by the Governor General provided that the conditions of
qualifications stated in the Constitution are met. No one would question that.
The intent of the bill is expressed in the very first "whereas" of the bill,
and I quote:
Whereas in 1987 the First Ministers of Canada agreed, as an interim
measure until Senate reform is achieved, that any person summoned to fill a
vacancy in the Senate is to be chosen from among persons whose names have
been submitted by the government of the province or territory to which the
vacancy relates . . .
The text of that "whereas" has a well-known constitutional history. It stems
from the failed Meech Lake Accord of June 1987. As honourable senators are
aware, two provincial governments failed to adopt the accord in their
legislature within the prescribed limit of three years. Despite the sincere
efforts made by its proponents, the accord failed in the end when both Manitoba
and Newfoundland did not endorse it. The Meech Lake Accord proposed at its
paragraph 4 that during the interim period of three years from 1987 to 1990, to
fill vacancies in the Senate, the Prime Minister had to choose among the names
that would have been given by the provincial government provided — and it is a
major, if not inescapable, condition — that they were acceptable to the Queen's
Again, we all know that the Meech Lake Accord failed June 23, 1990, and that
it was never proclaimed as the new constitution. It had no legal force or
The Premier of Alberta, Don Getty, recognized it with sadness in a formal
declaration on June 25, 1990. He said, "The dramatic gains that we would have
obtained through Meech Lake are gone and it is a huge loss to this province."
Premier Getty commented on Senate reform: "We just do not have the tools for it
or the commitment."
Two years later, the federal government proposed a new accord to all
Canadians through a national referendum; the Charlottetown Accord. The accord
provided for an elected and equal Senate at sections 7 and 8:
. . . that senators are elected either by the population . . . or by the
members of the provincial or territorial legislative assemblies.
Federal legislation should govern Senate elections, . . .
. . . Senate elections be held as soon as possible, . . . at the same
time as the next federal general election.
However, the Charlottetown Accord failed to be endorsed by six provinces.
Even Alberta, which was so keen to act on Senate reform, voted 60.2 per cent
against the accord, as did all three of the other Western provinces, with
British Columbia having the highest opposition at 68.3 per cent. Consequently,
as with the Meech Lake Accord, the Charlottetown Accord died and never had legal
force or effect.
Let us return to Bill S-8. What does the very first "whereas" of the bill
state? It declares:
. . . any person summoned to fill a vacancy in the Senate is to be chosen
from among persons whose names have been submitted by the government of the
province or territory to which the vacancy relates;
The second "whereas" provides that those names submitted by the provincial
government be determined by democratic election.
In other words, the first "whereas" of Bill S-8 restates the substance of the
Meech Lake Accord and the second "whereas" restates the substance of the
The intention of the bill is clear. It is made up of the same constitutional
substance as were the amendments in the Meech Lake and the Charlottetown
Accords. Those two "whereas" clauses shed light on the understanding of the
statutory obligation imposed by section 3 of the bill whereby the Prime Minister
must consider names from the most current list of nominees selected through the
process of provincial or territorial election.
Can we conclude otherwise that the nature of Bill S-8 is identical in pith
and substance to those amendments that were contemplated in the constitutional
accords of 1987 and 1992 and that they are, in fact, equivalent to a fundamental
change in the method of selecting senators?
What did the Supreme Court have to say about such changes? The analysis of
the nature of the changes contained in Bill S-8 has in fact been the object of a
ruling by the Supreme Court of Canada in the Senate reference of 1979. The
question put to the court by the Canadian government of the day following the
contestation by some provinces of the capacity for the Parliament of Canada to
enact the kind of changes contained in the form of Bill C-60 was the following:
Is it within the legislative authority of the Parliament of Canada to
adopt legislation altering the upper house of Parliament so as to change the
method by which members of the house are chosen by providing for the direct
election of all or some of the members of the upper house by the public?
The court unanimously answered:
The selection of senators by a provincial legislature or by the
Lieutenant Governor of a province would involve an indirect participation by
the provinces in the enactment of federal legislation.
The court stated:
The substitution of a system of election for a system of appointment
would involve a radical change to one of the component parts of Parliament.
As already noted, the preamble to the Act referred to "a Constitution
similar in principle to that of the United Kingdom," where the Upper House
is not elected. In creating the Senate in the manner provided for in the
Constitution Act, 1867, it is clear that the intention was to make the
Senate an independent body which could dispassionately canvass the measures
adopted by the House of Commons. This was accomplished by providing for the
appointment of members of the Senate with tenure for life. To make the
Senate a wholly or partially elected body would affect a fundamental feature
of that body.
The court was clear. The appointment of senators, currently the function of
the Governor General, having some members selected by another body, the
Lieutenant Governor-in-Council or selected following public election, is beyond
the power of the federal Parliament. Hence, the introduction in 1982 of section
42(e) of the new Constitution, which states that "the method of selecting
senators" is beyond the capacity of the federal Parliament acting alone.
Since the changes brought by Bill S-8 are in pith and substance of the nature
of a constitutional amendment, they cannot be enacted by Parliament alone under
section 4 of the Constitution. Such changes are covered by section 42 and
require the concurrence of seven provinces totalling 50 per cent of the Canadian
population. If the government wanted to initiate such a constitutional
amendment, there is only one way to proceed, which is not the way of Bill S-8.
The government has to introduce a formal constitutional resolution in the House
of Commons or in the Senate and ask the concurrence of the provinces as provided
in section 38 of the Constitution.
Our conclusion on the first count of unconstitutionality is clear. Bill S-8
in substance and form is ultra vires of the power of the federal Parliament.
The second reason why Bill S-8 is constitutionally invalid centres on the
long-recognized constitutional principle in our federal system that Parliament
cannot delegate any of its responsibilities to the legislature of a province.
What does Bill S-8 purport to achieve? Bill S-8 does not provide for a
framework or selection of senators to a federally controlled process, one which
former Bill C-43, introduced in 2006, proposed to enact.
The fundamental defect of Bill S-8 is that it is not a federal bill for a
federal process under the control of federal authorities. Bill S-8 seeks to
enact a framework for the legislature of the provinces and territories. In other
words, the federal Parliament is using its legislative power to enact provincial
legislation. The third "whereas" of the bill explains this provision:
And whereas it is appropriate that a framework be established to provide
guidance to provinces and territories for the text of legislation governing
There is no side door or quid pro quo to the meaning of the objective. The
federal Parliament intends to adopt an act that clearly delineates, in all its
details, the kind of act that the legislatures of provinces and territories need
to adopt to elect senators. This shift of responsibility to the provincial
legislatures is unconstitutional and the courts have said so for more than 130
The seminal case on this issue is known as the Lord Nelson Hotel Co, Ltd.
case, decided by the Supreme Court in 1950. The issues involved in that famous
case are analogous to those at stake in Bill S-8. The Parliament of Canada then
enacted legislation to delegate to the Nova Scotia Legislature the capacity to
adopt legislation concerning matters that had not been assigned to it. The court
The Parliament of Canada and the Legislatures of the several Provinces
are sovereign within their sphere defined by the . . .
They can exercise only the legislative powers respectively given to them
by sections 91 and 92 of the Act, and those powers must be found on either
of these sections . . . . Under the scheme of the . . .
— Constitution —
. . . they were to be . . . watertight compartments which are an
essential part of the original structure.
This interpretation of exclusive and respective legislative authority for
each level of government, whether federal or provincial, is almost as old as our
own federation. In 1880, Justice Taschereau, in Citizen's Insurance Co. v.
Parsons, stated that the:
. . . Federal Parliament cannot . . . give, either expressly or impliedly
to the local legislatures, a power which the Imperial Act does not give
them. This is clear, and has always been held in this court to be the law .
In 1899, in the case of C.P.R. v. Notre Dame de Bonsecours, the court
I think we must get rid of the idea that either one or the other can
enlarge the jurisdiction of the other or surrender jurisdiction.
Justice Kerwin, in the Lord Nelson case, stated:
The Constitution divides legislative jurisdiction between the Parliament
of Canada and the Legislatures of the Provinces and there is no way in which
these bodies may agree to a different division. . . . To permit of such an
agreement would be inserting into the Act a power that is certainly not
stated and one that should not be inferred.
What Bill S-8 purports to achieve is the transfer of responsibility for
electing Senate nominees to the provincial legislatures and
lieutenant-governors, giving them sole responsibility over supervision and
Bill S-8 contains a "text of legislation" — those are the very words of the
bill — governing such elections for the provinces to enact. This technique of
legislative delegation hurts the very core of our federal structure of
government. The courts have long understood that the outcome of such an approach
would be the destruction of the very division of power between the two levels of
For it is within the Powers of Parliament and of the Legislatures to
confer upon each other by consent, a legislative authority which they do not
otherwise possess . . . the same powers will naturally exist to enact laws
affecting all the classes of subjects enumerated in Sections 91 and 92 of
Justice Taschereau added:
It is a well settled proposition of law that jurisdiction cannot be
conferred by consent.
In other words, Bill S-8 proposes a "text of legislation" governing the
election of nominees for the provinces to enact, even though this principle is
contrary to the long-standing interpretation of the courts that each level of
government is restricted to act within the confines of its exclusive field of
authority under section 91 and section 92.
In The Law of the Canadian Constitution, third edition, W.H.P.
Clement, a noted constitutional scholar, writes:
Provincial legislation which, ex hypothesi, requires federal
legislation to support it is not legislation at all.
The corollary is also true, as Justice Taschereau has concluded in the
The powers of the federal authority cannot, to such an extent, be
dependent upon the consent and good-will of the provincial authorities.
In other words, the federal Parliament cannot delegate its legislative
authority to the provincial legislature even though they would accept to enact
the proposed "text of legislation," just as the federal Parliament cannot be
dependent upon the consent and the goodwill of the provincial authorities to
fill Senate seats in the manner it deems appropriate.
However, there is still more implied in Bill S-8. Bill S-8 proposes to have
the nominees elected under provincial legislative authority. The question is
this: Does the federal Parliament have authority to legislate for the
establishment of an electoral process to select Senate nominees? As mentioned
earlier, such a proposal is equivalent to a fundamental change in the method of
selecting senators, and it is clearly beyond the capacity of the federal
Then the trick is, if the federal Parliament cannot legislate on its own to
establish such an electoral scheme, can it not subcontract it to the province by
offering to appoint the nominees that are elected through a process that the
federal Parliament seeks to establish through Bill S-8? This scheme is a shell
game — hiding the pea under a different shell. This principle is at the core of
the objective of Bill S-8.
The federal Parliament cannot push or invite the provinces to act on its
behalf or for its own purposes when the Constitution does not allow it to do so
directly. The courts have already put their finger on such a scheme and have
In 1936, the Manitoba Court of Appeal held as follows:
Neither the Dominion nor the Province can delegate to each other powers
they do not expressly possess under the B.N.A. Act.
In other words, if the federal Parliament cannot legislate on such a scheme
of electing the senators, it cannot subcontract it to the provincial
legislatures and incite them to do so by a commitment to appoint their elected
nominees according to an electoral process already defined by the federal
Parliament and for future enactment by the provinces.
Bill S-8 is legislating an election scheme for the provinces to enact. This
bill is strange on legislative grounds. The federal Parliament, which consists
of the Queen acting by and with the advice of the Senate and the House of
Commons, would enact a "text of legislation" to provide the legislative text to
provinces and territories, which thereafter would be adopted by another
legislative authority of a different constitutive existence, that is, the
lieutenant governor with the consent of the legislature.
In such a twist, federal law becomes provincial law, adopted under a
different legislative authority. The court in the Nelson case has been
adamant on the issue:
The exercise of delegation by one for another would be an incongruity . .
— in federal organization —
. . . for the enactments of a State are of its own laws, not those of
In plain words, a delegation of responsibility implies a delegator capable to
delegate and a delegatee capable to accept. The Supreme Court has clearly and
definitely stated that the federal Parliament can no more delegate a legislative
responsibility to the provincial legislature than can the provincial legislature
accept on its own the delegation of legislative authority. Such jurisprudence
from Canadian courts fully answers the second count of constitutional invalidity
of Bill S-8.
The third constitutional objection to Bill S-8 is that the legislature of a
province cannot legislate in a field or domain of competence that is not
allocated clearly or that falls under one or the other paragraph enumerated in
section 92 of the Constitution Act, 1867. To be clear, without the formal
constitutional amendment, provincial legislatures have no jurisdiction to enact
legislation to establish an electoral scheme to elect Senate nominees.
Let me be clear. The Senatorial Selection Act of Alberta, first adopted in
1989 and amended in 2000, and Bill 60 of Saskatchewan to similar effect adopted
in 2009 but not yet proclaimed, are of no constitutional validity, being ultra
vires of the power of provincial legislatures.
The premise of Bill S-8 lies in the fact that the legislature of Alberta
enacted a bill in 1989 for the election of senators for the province to fill a
vacated seat for Alberta. Once elected, they are referred to as "senators in
The origin of the Alberta act stems from the Meech Lake Accord of 1987. Let
us recall that at the time of its signature, it was provided that until the
accord comes into force within three years, that is, becomes part of the
Constitution of Canada, the government of a province "may submit the names of
persons to fill a vacancy and those summoned shall be chosen from among whose
names have been submitted."
By those words, the provinces have no obligation to provide names. However,
once names have been given, a person among those names would be recommended to
the Governor General for appointment, provided the name "be acceptable to the
Queen's Privy Council for Canada."
It was paragraph 4 of the Meech Lake Accord. There was no mention in it of an
election process from which the name of such a person should be provided, and
discretion was still left to the Queen's Privy Council to determine if that
person was deemed acceptable. The accord mentions no criteria of any sort to
determine such acceptability. It was left entirely to the good judgment of the
Queen's Privy Council. That section of the Meech Lake Accord was meant to be
enforced during the three-year period of its ratification until June 23, 1990.
Before the accord came into force, the Government of Alberta at the time
introduced legislation entitled the Senatorial Selection Act, which was adopted
in August 1989, one year before the Meech Lake Accord lapsed. The Alberta act
contained three "whereas" provisions which gave the overall intent of the act.
The first "whereas" recalled the position of Alberta in relation to the
The second "whereas" referred specifically to the Meech Lake Accord, and the
opportunity for the government of the province to submit names of persons to
fill vacancies. However, it should be noted that the discretion left to the
Queen's Privy Council in the accord was omitted from the "whereas." It is not
mentioned anywhere in the Alberta act.
The third "whereas" goes way beyond the text of the Meech Lake Accord by
providing for the election of senators, an issue which was not even mentioned in
the text of the Meech Lake Accord.
The Alberta act continues with the establishment of an electoral scheme to
elect senators-in-waiting under the sole responsibility of the provincial
legislature. Those same "whereas" provisions were kept in the new Alberta act,
which was adopted in 2000, and in Saskatchewan's Senate Nominee Election Act,
which was adopted in 2009 but not yet proclaimed. Those acts offer the same
intent in the two opening "whereas" provisions.
As one realizes by the historical background of those two acts, the Meech
Lake Accord never committed to transfer the responsibility to provide for the
election of the respective senators to the provincial legislature. There might
have been talk, but the text of the accord never refers to such a constitutional
amendment. Moreover, the commitment of the federal government to appoint persons
to the Senate whose names would have been submitted by provincial governments
only lasted during the ratification of three years and certainly ceased to have
any effect when the accord collapsed in June 1990.
Beyond June 1990, no provincial government could claim to expect that the
names of persons it would submit should be appointed. It could mount public
objections, make multiple statements, lobby or use pressure of whatever sort,
but such claims have no legal legs to stand on.
Moreover, the Senatorial Selection Act adopted in Alberta in 1989 and in
Saskatchewan in 2009 has no legal base with regard to the Meech Lake Accord and,
thus, have absolutely no effect.
The evidence is that everything had to be renegotiated in the Charlottetown
Accord of 1992, but the Charlottetown Accord was also rejected by a majority of
Canadians in a national referendum held on October 26, 1992, including Alberta,
with 60.2 per cent; and Saskatchewan, with 55.3 per cent. Any commitment to
which the federal government might have subscribed in those two accords has
become null and void and is of no legal effect.
Let us ask another question. Since there is no constitutional authority
granted to the provinces because those two accords failed, does the Constitution
Act, 1867 allocate to the provinces, in section 92, the jurisdiction necessary
to enact legislation providing for the election of Senate nominees? This is the
crux of the question.
Let us put it in simpler terms. Did the Fathers of Confederation want to give
to the provinces, in section 92, the jurisdiction necessary for the provinces to
enact an election act for senators? We do not think that anyone with a minimum
knowledge of the Confederation debate could doubt for one instant the intent of
the Fathers of Confederation on the nature of the Senate. Would it be an elected
body or an appointed body? There can be no doubt about the answer to this
question. The intention of the Fathers of Confederation was to have an appointed
Senate, not an elected one. As a matter of fact, our institutional forerunner,
the Legislative Council of the Parliament of the United Canada, was made into an
elected body in 1856, well before Confederation. The ensuing problems between
the two elected chambers at the time were well known to the Fathers of
Confederation. They did not want to continue to extend such a system in the new
Would the Fathers of Confederation have been so unwise and careless as to
have left the back door open so that, one day, the provinces could restore an
The Supreme Court has had an opportunity to consider the nature of the Senate
and its essential character as an appointed body. In the Senate reference of
1979, the court stated:
In creating the Senate in the manner provided in the act, it is clear
that the intention was to make the Senate a thoroughly independent body
which could canvass dispassionately the measures of the House of Commons.
This was accomplished by providing for the appointments of the members of
the Senate. . . .
Considering the intent of the Fathers of Confederation and the court
interpretation of the appointed nature of the present Senate, can we again
identify in section 92 of the act any heading that would give the provinces the
legislative capacity to enact election schemes to elect persons for Senate
appointments? When one considers the 18 headings of section 92 and the scope
they entail with regard to the past court decisions, there is not even the
smallest opening left for the provinces to enact such legislation.
There is no way that the federal Senate can be part of the constitutional
power of a province. There is no constitutional base in the Constitution Act,
1867 upon which to draw the conclusion that a provincial legislature could have
the competence to enact legislation for senatorial election.
Let us take another example: judicial appointment. Section 96 of the
Constitution is entitled "Appointment of Judges." It states:
96. The Governor General shall appoint the Judges of the Superior,
District, and County Courts in each Province . . .
Could we make a parallel reasoning and contend that a legislature could enact
a bill providing for the election of nominees for judges to be appointed by the
federal government for that province? Raising this hypothesis illustrates the
kind of outcome one might expect if one were to contend that provincial
legislation can wade into any federal field of responsibility.
Section 24 of the Constitution Act, 1867, entitled "Summons of Senators,"
24. The Governor General shall from Time to Time, in the Queen's Name, by
Instrument under the Great Seal of Canada, summon qualified Persons to the
Senate; . . .
By legislating to elect senators-in-waiting to occupy a seat in the Senate,
both the Albertan and the Saskatchewan legislatures have attempted to make laws
in relation to a matter "assigned exclusively to Parliament or the Government of
Canada and consequently prohibited in their provincial legislatures."
On several occasions, the Supreme Court has established the limits to the
legislative initiative open to each level of government in our federation. As
recently as in 1998, in the Reference re the Secession of Quebec, the court
unanimously defined the scope of the principle of constitutionalism in the
That purpose would be defeated if one of those democratically elected
levels of government could usurp the powers of the other simply by
exercising its legislative power to allocate additional power to itself
The meaning is clear. A provincial legislature cannot usurp the powers of
federal Parliament or government by adopting legislation to unilaterally give
itself additional power that it does not have constitutionally.
However, the disturbing consequence following from the Alberta Senatorial
Selection Act was the ensuing decision taken by Premier Stelmach of Alberta on
Thursday, April 29, 2010, whereby he unilaterally postponed the forthcoming
election of senators-in-waiting, taking by surprise all proponents and
supporters of Senate elections in the province. Through a cabinet decree, the
premier extended the terms of its existing senators-in-waiting by three years,
that is, until 2013, after the terms run out this coming December. The Alberta
press was very critical, denouncing the decision by stating that this
illustrated the Alberta government's fear of the Wildrose Alliance Party winning
the election. An article in the Edmonton Journal stated that "to do
otherwise would be to widen the democratic deficit, not close it. To do
otherwise by not calling the election would be to offer Canadians more proof
that for too many Conservative politicians the definition of democratic deficit
is simply a time when we do not get our way."
Some Hon. Senators: Hear, hear.
Senator Joyal: Honourable senators, is this the kind of thinking that
Bill S-8 invites the provinces to enact in bringing new ideas and modernizing
the institution of the Senate of Canada, to quote from the text of the former
The argument alleged by the sponsor of Bill S-8 that the Alberta legislation
has not yet been contested in the Canadian court system does not give it any
more validity. It is not by appointing a senator-in-waiting for an Alberta seat
that the federal government has cured the fundamental defective nature of the
Alberta Senatorial Selection Act. The precedents here are of no value to cure
the ultra vires nature of that act. Even if 10 or 20 senators-in-waiting would
have been appointed in the past, this would not have made the process of their
election valid. One has only to remember the decision of the Supreme Court of
Canada in 1985, declaring null and void after almost 100 years all legislative
activities of the Manitoba legislature in relation to the use of official
languages. Time and numbers are of no healing value. What is null and void
remain always of no effect and can only create uncertainty and deception in the
It is not by inviting the provinces to act legally, by circumventing the
Constitution, that the political objective of an elected Senate will be reached.
The Constitution of our federal state contains a clear demarcation of
legislative authority. The election of senators cannot be achieved by ignoring
the legal framework that defines the nature of our system of government. The
Constitution guarantees the certainty, reliability and trust that Canadians
enjoy under our rule of law. One would expect another measure of statesmanship
and transparency in the process to transform our institution of Parliament so
fundamentally. Constitutionally, this approach is doomed to fail.
Honourable senators, I have not addressed the institutional aspect of making
the Senate of Canada an elected "provincial" chamber as provided in Bill S-8. I
would need just as much time to review the overall implications of transforming
the Parliament of Canada so fundamentally.
Make no mistake: to have two elected chambers in the same legislative process
would have numerous and profound consequences. To enumerate some of them to
persuade you that such a proposal needs sober second thought, here are five
elements of concern. First, according to Bill S-8, there would be the
introduction in the Senate of members who could be, for the large part, elected
members for provincial rather than federal parties. In other words, the
composition of the Senate would resemble that of 10 provincial legislatures. The
political allegiance of senators would then be to their own provincial political
parties. In any debate of federal legislation, amendments and votes, the elected
senators would take the position of their alter ego in provincial legislatures,
whether on the side of the government or that of the official opposition. Would
that make Canadian Parliament more effective and the country more united? To ask
the question is to raise a thousand questions that need to be seriously
Second, if the Senate becomes a house of provincial parties, should the
Senate have the equivalent powers in relation to legislation to those of the
House of Commons, minus the budget bill and constitutional change?
Third, would such a house become easily fractured with no majority and become
the ploy of interest groups with no bearing for the sake of Canada as a whole?
Fourth, how would adjustments be made between the federal parties represented
in the Commons and the provincial parties in the Senate, when the groups operate
independently from one another with different provincial election acts? For
example, financial contributions range from $9,300 in Ontario, open to corporate
donations; $3,000 in Quebec, with no corporate donations; $15,000 in Alberta,
$30,000 during an election year; and no limits in Saskatchewan and New
Are we making the Senate more effective, representative of a better federal
state, or are we not bringing the cat into the pigeon's house?
Such an initiative would bring radical change to the structure, dynamics and
distribution of power between the two houses of Parliament. Is the initiative of
Bill S-8 so innocuous and of such limited substance that these changes can be
brought without constitutional amendment?
That is certainly not the view held by several provinces. At the request of
the Leader of the Opposition, three provinces clearly stated their position.
Then New Brunswick Premier, Shawn Graham, wrote the following on April 9, 2010,
to the Leader of the Opposition in the Senate with respect to Bill S-8:
It remains the view of our government that holding election for senators
and adjusting the tenure of office without addressing other more pressing
concerns regarding the nature of the institution, including its size,
composition and powers relative to the House of Commons would give the
illusion but not the substance of democratic reform.
The Minister of Intergovernmental Affairs of Ontario, Monique M. Smith, wrote
the following regarding Bill S-8 on April 20, 2010, last spring:
As you know, real Senate reforms require constitutional change, and we do
not think it would benefit Ontario or Canada for Parliament to be launched
into a discussion on Senate reform that could lead to broader potentially
divisive constitutional negotiations. We do believe, however, that changes
to the Senate require the consent of the provinces and that unilateral
federal action is unconstitutional.
On March 31, 2010, Quebec's minister of intergovernmental affairs, Robert
Dutil, wrote the following about Bill S-8:
Senate reform, as proposed by the federal government, would change the
fundamental characteristics of that institution. Accordingly, such a change
is beyond the power of Parliament acting alone. We believe it is vitally
important that Senate reform, and the subsequent impact on all federal
institutions and on the balance of relations within the federation, be
debated in the appropriate constitutional context.
As one realizes, to quote former Senator Michael Pitfield in the foreword of
the book Protecting Canadian Democracy, the initiatives contemplated in
Bill S-8 are of untested consequences. He said the following:
In constitution-making it is important to bear in mind that the first
step in reform is almost never the final step.
Because a government is a large system with an overall equilibrium of its
own, any change in one place is bound to have repercussions elsewhere —
sometimes in surprising and far-off places, sometimes with far-reaching and
even contradictory effects.
Honourable senators, we cannot proceed with Bill S-8 without guarantees of
its constitutionality. Moreover, the changes that Bill S-8 would implement
cannot be adopted by this chamber without a complete study of their substance,
of their impact on our federal system and of the overall consequences they would
have on the federal-provincial quality of our country.
Hon. Hugh Segal: Will the honourable senator take a question?
Senator Joyal: With pleasure.
Senator Segal: I thank Senator Joyal for accepting a question.
Honourable senators, I was struck, if I may say so in the preamble to my
question, by three aspects of senator Joyal's argument, that I found profoundly
troubling. I ask, whether on reflection, might Senator Joyal also find them
The first is that even though we are the only federation in the world that
has its constitutional court, the Supreme Court of Canada, and our second
chamber appointed solely by one level of government, does Senator Joyal not
think any constructive effort that is constitutional to improve on that
circumstance might be in the interests of the federation and the survival of
this country over the long haul? Other federations have come to similar
The second part of my question is with respect to the Senatorial Selection
Act of Alberta, which is one of the provisions that led to my seatmate being
with us, the only individual in this chamber with a direct
multi-hundred-thousand vote plurality, sending him in this chamber to the
consideration of the Prime Minister for appointment. There has been no
constitutional challenge of that act, despite its so-called controversial
nature, as our good friend has pointed out in his analysis. Does Senator Joyal
not think that the burden of proof with respect to that constitutionality should
be on those who might challenge it and take it to the courts? The absence of
such challenge, although the provision exists for any jurisdiction to have done
so, indicates that on a de facto basis it has been accepted as democratically
feasible and appropriate.
Third, on various occasions in his analysis and very thoughtful speech, he
made the assertion that Bill S-8 changes the way our Constitution provides for
the appointment of senators. One of the reasons I would argue he might consider
this bill going to committee for thoughtful analysis and interpretation is that
many of us would take the view that the right of the Prime Minister, by
instrument of advice to His Excellency, to appoint a senator is in no way
diluted, diminished, diverted or reduced by this bill. All this bill does is
create the radical, insane proposition that the people of a province might be
given the chance to democratically express a view as to who might be on the list
from which the Prime Minister would make a recommendation to His Excellency or
Her Excellency, as the case may be.
On the basis of that difference of opinion, would the honourable senator not
be of the view that the great Liberal Party, committed as it has always been to
the future of Canada, not in ways with which I agree but nevertheless sincere,
would benefit from participating in moving this bill to committee so that
Canadians could hear his arguments, could hear contrary arguments, and could
have the kind of thoughtful analysis that stopping the bill before approval in
principle would deny the country?
Does he not in any way worry that the many efforts, to which he made
reference quite graciously at the outset of his comments, to reform this place
having been frustrated, set aside, diluted, allowed to die or referred in some
kind of spiritual way to the Supreme Court for further analysis, might create
the impression, perhaps unfairly, that the Liberal Party remains a centralist,
status quo, anti-democratic, anti-federal, anti-cooperative federalism
institution working against the survival of Canada if they take his advice on
The Hon. the Speaker pro tempore: I regret to inform
Senator Joyal that his time is up. Would he like to ask the house for more time
Senator Joyal: Yes.
Hon. Gerald J. Comeau (Deputy Leader of the Government): Five minutes.
The Hon. the Speaker pro tempore: Honourable senators,
is it agreed that Senator Joyal can have five more minutes?
Hon. Senators: Agreed.
Senator Dallaire: He can have how much time? No one says absolutely
five minutes. It could be ten minutes.
The Hon. the Speaker pro tempore: Senator Comeau, did I
correctly hear you to say "five minutes"?
Senator Comeau: Yes.
Senator Joyal: I would like to thank Senator Segal for his three
questions, and I hope to answer all three of them.
First, is it not strange that we are one of the only federations in the world
in which appointment to the Supreme Court bench and the upper chamber lies
solely in the hands of one level of government? Canadian constitutional history
is full of proposals for changes to the Supreme Court of Canada. My honourable
colleague will remember Quebec's five proposals in the Meech Lake Accord for
changes to the process for appointments to the Supreme Court that would have
given Quebec some guarantees it was seeking. There were also provisions to that
effect in the Charlottetown Accord.
The problem is not that this or another Parliament did not want to proceed
with that. In fact, in those days there was a consensus in Parliament to move
with the Meech Lake Accord and Charlottetown Accord. The problem was that
Canadians rejected them for reasons other than that specific amendment, but the
overall result was that they were lost. As I said, they were not lost because
only Quebec or only Ontario refused. Six provinces voted to put it in the
Clarity Act in a clear way.
On the second question, those changes have to be well thought out. One thing
puzzles me about the six bills relating to Senate reform that we have seen pass
like trains in the last four years. When the Blair government in Britain wanted
to reform the House of Lords, they appointed the Wakeham Royal Commission. Some
may think that royal commissions take a century to come forward with
recommendations, but that is not true. The Wakeham commission came forward with
recommendations for substantive reform within a year and a half of its
There was the intellectual capacity under the leadership of Lord Wakeham to
make proposals to allow for serious and rational debate on changes. Moreover, in
the three years following the tabling of the Wakeham report, the then government
published three different white papers on different aspects of reform of the
House of Lords. In the end, they were able to achieve some of the reforms,
albeit not all.
At least they now have a statutory commission for appointments.
One could question the way that has operated due to various situations that I
will not go into here, but those who are interested certainly know of them. At
least they now have a body for appointments that seems to have made the House of
Lords more legitimate than it was when appointments were the sole prerogative of
the Prime Minister.
It is possible to move forward when one takes the right course of action to
provide for intelligent debate — not intelligent design. I think that we have
put the cart before the horse. We have had six bills in the last four years,
each one different from the others, each one changing something different, but
the explanation and the reflection do not seem to be tangible. In my opinion, we
should be reflecting on that on both sides of this house.
Finally, as I stated in my opening remarks, at least four provinces
questioned the constitutionality. That was not me, not Senator Fairbairn,
Senator Fraser, nor any other senator. Among them were my own province,
Newfoundland and Labrador, and New Brunswick. If in 2008 the government had put
forward the question of the constitutionality of the Alberta Senatorial
Selection Act, we would have today a framework for moving ahead. As long as we
move around in the dark, we will have to find our way by feeling for the walls
and, in the end, we will not be sure of reaching the door. That is what concerns
Hon. Bert Brown: Honourable senators, I thank Senator Joyal for his
The Hon. the Speaker pro tempore: Senator Joyal's time
is up, so it is not possible to ask a further question. If Senator Brown speaks
now, it will have the effect of closing the debate.
(On motion of Senator Cowan, debate adjourned.)
On the Order:
Resuming debate on the motion of the Honourable Senator Brazeau, seconded
by the Honourable Senator Lang, for the second reading of Bill S-11, An Act
respecting the safety of drinking water on First Nation lands.
Hon. Charlie Watt:
[Senator Watt spoke in Inuktitut.]
Honourable senators, I thank the government for making clean drinking water
for First Nations a priority. We all agree that the right to clean drinking
water is important to all Canadians, and we want legislation that addresses this
My concern with Bill S-11 is the impact of clause 4(1)(r) on the rights of
Aboriginal peoples in this country. In particular, regulations under this act
would abrogate or derogate from our constitutionally protected rights under
section 35 of the Charter.
It is my role as an Aboriginal senator to bring these elements to the
attention of honourable senators as we study this bill.
The special trust relationship and the responsibility of the government to
Aboriginal peoples must be our first consideration in determining whether the
legislation can be justified. We must ensure that fair resources are available
and that the Aboriginal nations in question are properly consulted at the
This issue of trust is a delicate matter. At the tip of the iceberg,
Aboriginal leaders are wondering why this legislation is being introduced. It
appears to be about water quality but the wording of it has many in the
Aboriginal community questioning whether there is more to this legislation than
meets the eye.
Aboriginal leaders have asked me about the justification for this bill. We
are concerned by the wording of this particular bill because it takes a position
that is very different from the recommendations made by the Standing Senate
Committee on Legal and Constitutional Affairs in their 2007 report titled
Taking Section 35 Rights Seriously: Non-derogation Clauses relating to
Aboriginal and treaty rights.
In this report we are reminded of the scope of section 35 rights, as we are
from the Sparrow decision of the Supreme Court of Canada. This report is
an excellent overview of the responsibility of the Crown.
I am also concerned because this bill seems to contradict the recommendations
in the 2007 report of the Standing Senate Committee on Aboriginal Peoples on the
subject of safe drinking water in First Nations communities. In this report on
the issue of resource allocation, Dr. Harry Swain, Chair of the Expert Panel on
Safe Drinking Water for First Nations, said his personal conclusion is that if
we want to see the completion of what has been a fairly considerable national
effort to get good water on Indian reserves, then we should worry about the
basic resources first and about a regulatory regime later.
On the point of consultation, the Supreme Court of Canada has elaborated on
the legal requirement for this study to consult. As we consider Bill S-11, it
seems that clause 4(1)(r) suggests that the Crown contemplated that the
forthcoming regulations might have a negative or adverse affect on Aboriginal
rights or titles protected under section 35.
Honourable senators, I am troubled by the precedent we are setting. The way I
see it, the government is venturing into provincial jurisdiction and outside of
parliamentary scrutiny with this bill. On the issue of section 35 rights, I
again refer honourable senators back to the Standing Senate Committee on Legal
and Constitutional Affairs report, which says:
This approach appears to establish a precedent for dealing with
non-derogation of Aboriginal and treaty rights as a regulatory matter rather
than addressing the issue explicitly in legislation, with obvious
implications for Parliamentary scrutiny.
On this note, I would like to state for the record that I have met with
Assembly of First Nations representatives and received written correspondence
from those who are alarmed by the actions of this government, actions which seem
to be forcing them into a serious agreement with a yet-unknown third party
without adequate consultation.
I remind those who are new to this chamber that Aboriginal peoples have
struggled for generations to achieve legitimacy at the negotiating table. We
take the issue of consultation and respect seriously.
Although I do not often speak of this, honourable senators, Aboriginal
leaders carry a tremendous burden; their communities and their families have
paid dearly for our involvement in political life. My involvement in the
repatriation of the Constitution is one of the highlights of my career; the
James Bay and Northern Quebec Agreement is the other. In both of these
proceedings I was honoured to negotiate on behalf of my people, but I did so at
great personal expense.
Honourable senators, although those issues may seem old news to some, the
embers of those political battles still burn in the hearts of those who
negotiated with the government. Some of us have lived through the bitter and
violent days of negotiations. We made advancements for our people, at a cost.
Although we have achieved much, it appears that Aboriginal people still have
less respect from the government and we still do not enjoy the same equality
provided to other Canadians. The fact that this bill contemplates abrogating
Aboriginal rights through regulation that will not be scrutinized by Parliament
is an embarrassment to Canadians and it is offensive to Native leaders. Once
again it seems that government is trying to out-muscle us in a publicly
Honourable senators, as I conclude my remarks, I would suggest that we have
many potential problems with the bill in its current form. We are not working
from a position of trust, we have not heard any solid justification for this
bill in any of the government's own reports, there is no provision for the
resources in this bill and the consultations with the First Nations were weak. I
repeat: they were weak.
Honourable senators, it is our duty to ensure that Aboriginal and treaty
rights are protected. We must insist on the cooperative framework between the
Government of Canada and First Nations because that is the Constitution we live
(On motion of Senator Mitchell, debate adjourned.)
Leave having been given to revert to Senate Public Bills, Item No. 8:
On the Order:
Resuming debate on the motion of the Honourable Senator Hervieux-Payette,
P.C., seconded by the Honourable Senator Tardif, for the second reading of
Bill S-205, An Act to provide the means to rationalize the governance of
Canadian businesses during the period of national emergency resulting from
the global financial crisis that is undermining Canada's economic stability.
Hon. Céline Hervieux-Payette: Honourable senators, I rise today for
the second reading of Bill S-205, a bill that will restore Canadians' trust in
corporations that have received government assistance, bailouts or support, and
that will ensure that directors act solely in the best interests of those who
have provided the financial assistance: Canadian taxpayers.
Bill S-205, An Act to provide the means to rationalize the governance of
Canadian businesses during the period of national emergency resulting from the
global financial crisis that is undermining Canada's economic stability, will
limit to $500,000 the remuneration paid to officers of corporations receiving
The financial crisis that started in 2008 caught people off guard despite all
the obvious warning signs. This event demonstrated a number of things: first,
that our economy and the global economy are interconnected; and second, that
some people's lack of accountability and greed gave some individuals free rein
to turn a profit at the expense of hundreds of millions of people who lost their
homes, their savings and their jobs. The government must therefore assume its
responsibilities and help these people and businesses keep their jobs. Canadians
should not have to pay for the mistakes of profiteers.
At a time when Canadians are angry with their leaders for not doing enough to
prevent the crisis and are demanding, with increasing insistence, that the
government and the private sector be more transparent and accountable, they
deserve the assurance that their hard-earned money will be put to good use and
benefit Canada as a whole.
Accountability and transparency are two concepts that are frequently used in
these hard times and they represent the type of values we must install in all
spheres of our life, whether it be in this place, our government and
institutions or the private sector. Bill S-205 seeks to reform corporate
governance to restore both corporate and consumer confidence in the economy.
Many important international organizations have commented on the link between
corporate governance and the performance of a company. In 2005, during the sixth
Global Forum of Reinventing Government organized by the United Nations, Chul-kyu
Kang, then Chairman of the Korea Free Trade Commission, said in a paper entitled
Market Economy and Corporate Governance — Fairness and Transparency for
According to various experimental studies, ethical management has shown
positive influence on business performance. Companies, which ensure
high-level of ethical treatment, have seen improved productivity and profits
for giving more motives and encouragement to their staffs to work harder.
Honourable senators, we must remove the negative stigma associated with the
government taking on the responsibility of enforcing positive changes in the
private sector. The government, like other governments in Europe and the United
States, can and should take every possible step to improve ethical corporate
governance. Responsible corporate citizens can play an important role in our
society and our economy. We must create terms for which they hold respect and
will abide by certain moral standards and lead by example in good and bad times.
According to Mats Isaksson, Head of Corporate Affairs at the OECD:
. . . when there is a very weak link between pay and performance it is
obviously a case of poor governance.
People who lost billions of dollars were still paid annual salaries of over
$20 million. He added:
When looking at various models for compensation, boards should explicitly
ask themselves if the company's compensation model is aligned with prudent
risk taking and the long term objectives of the company.
Like some of its G8 partners, Canada needs to take measures to create a
climate of greater financial responsibility. We need to follow the examples of
the United States and Germany, which have taken measures to cap incomes of
company executives at $500,000 U.S. or 500,000 euros if their business has been
bailed out with taxpayers' money. Bill S-205 would follow that lead and cap, at
$500,000, the remuneration of company executives running Canadian businesses
that have been saved, bailed out or helped.
Our economic well-being is closely intertwined with that of the United
States. We should not hesitate to impose these rules on businesses that receive
public monies. This bill is a commitment to fixing the moral problems that led
to this mess we are in, which required the use of pension funds to pay the bill.
Strong business governance must become one of our priorities. Other countries
have understood this, and it is time that we did too.
I can already hear some of my colleagues crying foul and wondering about the
poor executives who run their business well and respect the deadlines for
reimbursing their debt to Canadian taxpayers. Bill S-205 also proposes to limit
executive bonuses to one third of their salary or stock options, which would
allow for good performance to be reasonably rewarded. In addition, by not
allowing excessive bonuses, we are working towards restoring public confidence
and making people understand that stock options and bonuses are a privilege to
be earned, not a right, and that this privilege must not negatively impact the
real owners, namely, shareholders and those who helped bail out the businesses
European countries were hit hard by the economic crisis and, like Canada,
were forced to question whether our current capitalist model was to blame. The
European Commission was mandated to study how to reform the financial system in
order to avoid a future crisis. We know that we do not need another crisis.
Allow me to read two passages from one of their green papers entitled
Corporate Governance in Financial Institutions and Remuneration Policies:
Strengthening corporate governance is at the heart of the Commission's
programme of financial market reform and crisis prevention. Sustainable
growth cannot exist without awareness and healthy management of risks within
The paper continues:
Although corporate governance did not directly cause the crisis, the lack
of effective control mechanisms contributed significantly to excessive
risk-taking on the part of financial institutions.
Excessive risk-taking by corporations can be reduced with strong corporate
governance and remuneration policies that are proportional to the accurate
financial health of corporations. Bill S-205 requires the creation of
remuneration committees to ensure that remuneration will be no more than 20
times greater than the annual average industrial wage as calculated by a famous
institution, Statistics Canada, and by examining the book value of the
corporation for the current fiscal year compared to its book value for the
preceding fiscal year.
In the last 20 years, the gap between workers and managers, honourable
senators, has increased dramatically, up to 240 times in some corporations.
These checks and balances are right on the money. They are good for business,
good for Canadians and reinforce the fact that corporations indebted to the
federal government must act in the best interests of their companies, their
employees, their shareholders and the Canadian people.
Since the crisis started, world leaders have come together to seek greater
cooperation in stabilizing the financial system at G8 and G20 summits and the
World Economic Forum. Canada participated in these meetings, but has yet to do
its homework and to show leadership in reforming the financial sector. One thing
is perfectly clear: Canadians want the economy up and running again, they want
the money they loaned to struggling companies to be paid back, they want global
business culture to become more accountable and transparent, and most
importantly, they want more fairness between workers and management.
Honourable senators, it is possible that we weathered the economic crisis
better than others, at least in some respects, but that does not mean we are
less vulnerable to the abuses being committed around the world. The longer we
take to fix these endemic problems in the financial system, the longer they will
persist. Publicly traded Canadian companies must be held accountable to
Canadians. Our population is aging, and Canadians need the job security that
comes along with sound management practices. As we saw with Nortel, a poorly
managed company can make a real mess. Those who chose to invest some of their
savings in securities for retirement want to be sure that no publicly traded
company will act irresponsibly.
The Canadian taxpayer has invested over $70 billion in bailout funds and
needs to be reassured that regulations are imposed on companies who have
received some of this money. Bill S-205 proposes realistic and achievable
regulations that will foster better corporate governance, restore faith in the
private sector and assure a stable economic recovery.
Some of my colleagues opposite might be of the opinion that Canada should not
force regulations upon the financial and private sector at the risk of choking
any form of economic recovery in this country or abroad. Honourable senators,
let me be clear. Bill S-205 is not aimed at reducing the private sector's
ability to create jobs, stimulate innovation and improve communities. It aims to
send a warning that all that incompetence and greed will not be rewarded by this
government, by any other government or by the Canadian taxpayer.
The regulations I propose for companies that receive money from the federal
government would cap officers' salaries at $500,000 or, as I said, roughly 20
times what the average Canadian worker earns, prohibit bonuses or stock options
worth more than one third of the officer's salary, so one third of $500,000,
prohibit directors — people who sit on boards of directors and who currently can
sit on several boards at once — from sitting on more than four boards at the
same time, and require them to invest in the corporations they direct. These
rules will change the culture of irresponsibility and greed that shook the
global economy, ruined families and left thousands unemployed.
I would like to quote someone who talked about how countries needed to take
action to reform the financial sector instead of just talking about reform. This
person said that:
. . . an agreement to act is just a start. It is acting on the agreement
Those words were spoken by none other than the Prime Minister of Canada, Mr.
Harper, when he addressed the World Economic Forum in Davos, Switzerland, last
Bill S-205 will force Canadian companies that received loans from the federal
government to lead by example. Canadians deserve to know whether their
investments have paid off and whether the money they loaned is being put to good
use. Bill S-205 will require these companies to report on the benefits their
officers receive, whether for travel, entertainment, living expenses or personal
benefits such as health insurance and, in some cases, exotic trips to attend
board meetings in locations that generally are warmer than our country. This
measure is aimed at deterring officers from abusing their privileges and putting
an end to hypocritical behaviour at the expense of workers, whose hours,
salaries, and benefits get cut, if not their jobs outright.
Business cannot go on as usual. The invisible hand of the market has slapped
us right in the face. Public monies cannot and should not be used to enrich
company directors who line their pockets with cash as their companies continue
to sink into the abyss.
I think mainly of a former Canadian jewel, Nortel, whose former employees now
are left with nothing. Pensions are gone; disability insurance is gone; jobs are
gone; and, of course, for all the shareholders, their money is gone. All the
while, executives were walking away with million-dollar bonuses and golden
Honourable senators, even my personal hairdresser lost half her pension by
investing in Nortel. This situation cannot go on, and Canadian families should
never have to live through similar ordeals. The responsibilities of board
members and officers must be made clear, especially when the federal government
becomes a major creditor.
Honourable senators, supporting this bill means that you support the role of
the private sector in our economy. When public monies are involved, there must
be responsibility, accountability and economy. This will help companies
restructure effectively, survive, thrive, and pay back their monetary and moral
Honourable senators, Canada has the opportunity to take a leadership role in
reforming the global financial system in Canada to foster growth while promoting
fiscal responsibility. The pen might be mightier than the sword, but actions
speak louder than words. Supporting this bill is morally the right thing to do
because the state of the economy is everyone's business, and I feel that we owe
this bill to them.
Hon. Hugh Segal: Will my honourable friend take a question?
Senator Hervieux-Payette: With pleasure.
Senator Segal: I wonder if Senator Hervieux-Payette might share her
best advice with us on the instruments of execution and enforcement that she
thinks might be the best way to put this legislation into effect, should it
For example, if the government of the day has a program of providing loans
and assistance for research and development, or loans and assistance for
environmental innovation — whatever might be the goal of a program — and
publicly traded companies in the federal jurisdiction are encouraged to apply
and they apply, would they, upon receipt of the loan or prior thereto, have to
satisfy the federal Crown through an attestation or through a contractual
agreement that they have met, prior to receiving the funds, all the terms and
conditions that she has argued for in this piece of legislation?
Will the federal government need a special audit capacity to determine
whether the status quo ante had changed, whether the status quo as provided for
by the corporation, continued appropriately in response to the legislation?
Finally, corporations run into financial difficulty, for whatever reason —
good faith or misfortune, for instance. I think she would agree many
corporations ran into difficulty because lines of credit evaporated in 2008; it
was not necessarily because they had done anything bad but because others had
played with the system in a way that she has accurately described as unhelpful
and inappropriate. Would she then move those kinds of companies in that
circumstance into this category on a retroactive basis?
I am just trying to understand because in the end, if the bill passes,
somebody will have to draft regulations. Those regulations will have to be
realistic and manageable. For those of us who are trying to understand the bill
in its full depth, any advice the honourable senator might give us with respect
to that implementation process would be most helpful.
Senator Hervieux-Payette: I thank the honourable senator for the
question. First, I come from the telecommunications world, so I am more familiar
with the sector. A great deal of money was invested in the telecom business. I
can go back to the disaster of Nortel because they received millions of dollars
in incentives to develop new products and so on. Most of the time, such products
did not reach the marketplace.
I remember the CEO of that company saying that the federal government was
very badly run. The next thing we knew, the company submitted flawed financial
statements to the shareholders and probably to the government. For three
consecutive years, the financial statements did not reflect the corporate
When the honourable senator refers to the major funding that the federal
government provides to the private sector to innovate, my experience is that the
accountability of these monies can be improved. I can see that we provide a lot
of money for research at the first stage and very often we never see it again,
and nothing emerges from such investment.
I am talking about Canadian taxpayers' money compared to people who are in a
publicly traded company. We saw the bubble burst in the 1980s when everything in
the high-tech sector blew up. I do not want a third phase because I do not think
our economy can support it.
I am saying that if they do everything outside of government money — no BDC,
EDC or Innovation Fund — and they go on their own with the private sector, they
can pay their executives as much as they want. However, we also have to remember
that most of our publicly traded companies are financed with pension funds. All
these pension funds have put money away. I do not think that many of the
directors who were appointed did their jobs, so I want the directors to be more
responsible at the remuneration committee level. I want to close the gap.
We have seen countries like Argentina going in the same direction as Canada.
There, you have the very poor and the very rich, with a very small middle class.
To keep the middle class investing in shares and pension funds and to continue
investing in the marketplace, we need to protect these investments and we need
these managers to be accountable.
My $500,000 cap is something for debate and discussion, but this is what Ms.
Merkel and Mr. Obama did, and of course I inspire myself. However, to say that
from 1980 to 2010, we went from about 40 times the average salary for executives
to 240 times, I think we need to reflect on that and see how we can limit that
type of increase.
Senator Segal: Will the honourable senator accept a further question?
Senator Hervieux-Payette: Yes.
Senator Segal: I share with the honourable senator a profound anxiety
about the gap that has developed between the people working on the floor with
relatively well-paid industrial wages and the compensation level for those who
are at the senior levels. I think that gap is a huge problem for the health of
capitalism going forward.
I want to understand whether the honourable senator is referring to what
Chancellor Merkel and President Obama did relative to companies that had been in
trouble and for which the state stepped in to provide liquidity, hopefully for a
shortened period of time. Is the senator also referring to companies that would
avail themselves of normative government programs, grants and loans while they
were in a state of health, while the government programs existed?
Would the senator want to impose the same restrictions, which make very good
sense in the former case, on those other companies who may be participating? I
think, for example, of a great Quebec and Canadian company, Bombardier. In order
for it to appropriately compete with the aerospace industry around the world, it
will have to avail itself of BDC and EDC financing in the normal course, and I
am delighted to see them get it, quite frankly.
Would it be your view that if they were recipients of that type of program,
until the money was paid back, the rules in your legislation should apply to the
way they manage their affairs, even within the context of needing to have the
very best executives and design engineers in the world so that the superb
product they produce continues to excel worldwide?
Senator Hervieux-Payette: Indeed, what I am proposing would apply to
more than just companies we saved from bankruptcy. Consider the automotive
sector, in which our government had no choice but to invest. Whether we are
talking about the CAA in Quebec or any other business in Canada, when taxpayers'
money is invested, I do not see why the senior management would go beyond the
limits I have proposed, for the simple reason that those are more or less the
salaries paid to the people who give these grants — presidents of corporations
such as BDC, EDC and other organizations. They are also competent executives. I
am quite certain that they do not take pleasure in having to help a company grow
and in doing business with an executive who is asking for millions of dollars to
expand but who, at the same time, is paying himself or herself 10, 15 or 50
times their salary.
I would simply say this: if companies are not receiving public funds, their
presidents and CEOs can continue paying themselves $20 million a year if they
like. However, when the government has to intervene and invest in those
companies, I think we must be accountable to taxpayers and pension funds. It is
the government that makes the rules. I think it would show greater
responsibility on our part if this applied to all public companies. I would not
include private corporations in this, because they get their funds elsewhere.
However, in this case, whether it is a question of innovation, modernization
or general funds for the sector, for example, for the forestry industry, which
has been struggling, we want to take companies to the next level to make them
more competitive. I think this bill will reassure Canadian workers who pay
taxes, and at the same time, help ensure that these people are working in the
best interest of the company, and not only in their own personal interest.
(On motion of Senator Comeau, for Senator Gerstein, debate adjourned.)
(The Senate adjourned until Thursday, October 21, 2010, at 1:30 p.m.)