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Debates of the Senate (Hansard)

1st Session, 38th Parliament,
Volume 142, Issue 55

Wednesday, May 4, 2005
The Honourable Daniel Hays, Speaker


Wednesday, May 4, 2005

The Senate met at 1:30 p.m., the Speaker in the chair.



British Columbia

Kelowna—Centennial Celebrations

Hon. Ross Fitzpatrick: Honourable senators, I am happy to advise that tomorrow I will have the honour to participate in the city of Kelowna's centennial celebrations reflecting its past and embracing its future. At its incorporation, May 5, 1905, Kelowna was primarily a cattle-raising and fruit-growing agricultural settlement of 600 people. Today, after 100 years of progress, Kelowna has become British Columbia's largest city outside the Lower Mainland and Victoria, and one of the fastest growing areas in Canada. It is a city with a colourful past and an unlimited future, and I am proud that my family's association dates back to 1913 as pioneer fruit growers.

Owing to its location along the shore of beautiful Lake Okanagan and its unique geography, Kelowna is blessed with a magnificent temperate climate with long, sunny summers and short, mild winters. This has led to it becoming a popular tourist destination with year-round attractions. In addition to its tourism sector, the city features a diverse and vibrant economy. It is the centre of a premium fruit-and vegetable-growing economy; a world-class wine region; a modern, flourishing aerospace industry; and an award-winning, innovative biotechnology sector.

What pleases me most, honourable senators, is that Kelowna's economic progress has been guided by environmental responsibility. Kelowna residents enjoy much good fortune, and through participation in such initiatives as the Okanagan Partnership, which is a collaborative economic program applying green, sustainable, economic development principles to the whole Okanagan Valley, they are taking the appropriate steps to ensure that future generations will be able to enjoy the same enviable quality of life that we enjoy now.

Citizenship and Immigration

Comments by Minister

Hon. Donald H. Oliver: Honourable senators, I rise today to call the attention of senators to some language used by a minister of the Crown that many of us find unprofessional. I refer specifically to comments attributed to Joseph Volpe, Minister of Citizenship and Immigration. In a Canadian Press story by Terry Pedwell reported today, Immigration Minister Joseph Volpe compared Conservatives to the Ku Klux Klan. The article states:

The Opposition party is made up of racists, Volpe said Tuesday, calling members recognizable "notwithstanding that they don't have their cowl and their cape."

The minister added:

The Klan looks like it's still very much alive.

Later in the article, the minister is quoted as stating:

I think these are a couple of fine, upstanding members of the new Conservative Klan...

Honourable senators, I am a member of the opposition party and I am a member of the Conservative Party of Canada, and I take exception to allegations of me being a racist. Many of us on this side have spent decades fighting for equality and fairness and to break down racist barriers in Canada. I speak specifically of my leader, Senator Noël Kinsella, who for years has not only been a professor of human rights law but has also been a strong advocate for equity and fairness. I also refer to the extensive work done by the Chairman of the Standing Senate Committee on Human Rights, Senator Andreychuk. I have spoken several dozen times in this chamber about the need for fairness and equality in our judgment of other people.

The language of Minister Volpe evoking images of Ku Klux Klan members with their cowls and capes has done a disgraceful disservice to all parliamentarians, particularly those who have fought so valiantly to combat racism. More important, he has belittled and trivialized the experience of many Canadians who have been victims of racism.

Quite frankly, honourable senators, I cannot understand why a minister of the Crown would use such charged imagery when, in fact, it bears no connection or relationship to members Richardson or Schmidt or other Conservative members of Parliament. The language was insulting and unbecoming a member of Parliament and, in particular, a member of Her Majesty's Privy Council.

Honourable senators, thousands of visible minorities in Canada have been held back, discriminated against and treated as less than equal Canadians because of their colour or their race. Any person who has been discriminated against and who has been denied an opportunity or who has been shunned on the basis of race will immediately recognize the insensitivity and disrespect of these words from the minister.

I am certain the minister would want to immediately apologize for the misunderstanding that the implications of his statement have caused for Canadians from coast to coast. This flagrant act of partisan politics by a member of a minority government is shameful and cries out for a clear and unequivocal apology.


Centennial Celebrations

Hon. Pana Merchant: Honourable senators, Saskatchewan, Cree for "swift-running water," became a province in 1905. The Queen joins us this month in celebration of our contribution to Canada and the world.


Initially, we welcomed immigrants from all the countries of Europe, from the Baltic Sea to the Mediterranean Basin, from the Atlantic Ocean to the steppes of Russia. Together with the First Nations, we developed our distinct traditions.


Our ethnic diversity over these 100 years was the precursor of the diversity of which Canada is so proud today. We were the prototype of the multicultural community Canada has become.


We take great pride in our contribution in two World Wars, pride that our First Nations and Metis joined in record numbers and served with extraordinary heroism.

At Vimy Ridge, where Canada is said to have come of age, the North Saskatchewans, the Regina Rifles and the Saskatchewan Dragoons served with distinction.

The South Saskatchewan regiment and the Regina Rifles were there at the disastrous raid on Dieppe.

On D-Day, the first infantry ashore on Juno Beach was the Regina Rifles. Unlike what happened on other fronts, the "Farmer Johns," as they were called, reached the brigade's objective on the second day as planned.

Many will know Saskatchewan as the cradle of universal medical care, but few know that decades prior we had free hospitalization for tuberculosis patients. We led the world in the diagnosis, treatment and eradication of the disease.

Among our other firsts was the development of the cobalt bomb, enabling radiation treatments of cancer.


Saskatchewan is recognized as the world's bread basket. We have exported our agricultural techniques as well as our products, and we have influenced and helped the agricultural economy of many countries as different as Russia and Ethiopia.


As early as 1912, we developed the first producer cooperatives, followed by the wheat pools, dairy and freshwater fish co-ops, and also consumer cooperatives, from groceries to telephones and credit unions.

We are Canada's second largest oil producer. We have always mined coal, are a major timber producer, and have one of the largest deposits of uranium and potash in the world and, most recently, diamonds.


To celebrate Canada is to celebrate diversity and the unique strength of each of our regions.


Saskatchewan looks to the future with confidence.

Mental Health Week

Hon. Ethel Cochrane: Honourable senators, May 2 to 8 is Mental Health Week across Canada. This week is set aside each year by the Canadian Mental Health Association to increase awareness of mental health issues and to offer support to the many people who live with mental illness. Although it is difficult to pinpoint the actual number of people affected, it is estimated that one in five Canadians will face a mental health issue in their lifetime.

Each Mental Health Week is designated with a special theme, and this year focuses on "Mind and Body Fitness." As a society, we tend to concentrate primarily on physical fitness and exercise. However, mental fitness is just as important to an individual's overall state of health. We achieve mental fitness in a variety of ways, such as maintaining an optimistic outlook on life, building an emotional support network with family and friends, and engaging in activities that stimulate the mind.

Of course, there are also strong links between greater physical fitness and enhanced mental fitness. For example, an active lifestyle can improve a person's psychological well-being and help reduce depression or their level of stress.

Honourable senators, the Standing Senate Committee on Social Affairs, Science and Technology has been hard at work reviewing mental health, mental illness and addiction in Canada. Last November, the committee released three reports that summarized our mental health system and those of four other countries. The committee also presented issues and options for further consideration as our study goes forward.

I hope that our efforts will help bring about significant and lasting change in a complex and fragmented mental health system. It has been said in this chamber before, and I think it bears repeating, that Canada is the only G8 country that does not have a national mental health strategy. This must change.

I am sure I speak for all honourable senators in wishing the Canadian Mental Health Association a successful Mental Health Week and continued good luck in all of their efforts.

Alberta Scene

Hon. Tommy Banks: Honourable senators, I wish to join in respect of happy anniversaries in congratulating the city of Kelowna. My connection with it only goes back to the 1940s, not as far as Senator Fitzpatrick's. I would also like to congratulate the beautiful province of Saskatchewan, which is celebrating its one-hundredth anniversary this year.

However, I rise, honourable senators, just in case someone has been in a bottle for the last couple of weeks and has not noticed there has been an invasion of Ottawa by over 600 artists of every description. They are culinary artists, literary artists, novelists, poets, sculptors, painters, actors, singers and dancers of every description. If one were to open a closet in Ottawa these days, one would find a band from Alberta playing in there.

I commend the attention of honourable senators to these celebrations because there is wonderful music being played, wonderful arts to see and to hear. There is wonderful theatre in which to participate, and I would urge all senators to attend. The celebration opened last Thursday with a triumphant Ottawa premiere of a most remarkable thing, a successful Canadian opera, followed on Friday by an appearance, which can only be described as triumphant, by the Edmonton Symphony Orchestra playing all-Alberta music. Between last Thursday and next Tuesday, one cannot avoid Alberta art and artists in Ottawa. Once again, I urge honourable senators to take in the festivities.

Citizenship and Immigration

Comments by Minister

Hon. David Tkachuk: Honourable senators, Minister Volpe's desperate attempt to characterize Conservatives as racist members of the Ku Klux Klan is an example of the appalling means to which this Liberal government is determined and prepared to go to deflect attention from their own problems. Use of satire, public discourse and healthy freedom of the press are all rights to be valued and protected in Canada; libel and slander are not.

In referring to two Conservative members holding a satirical poster, here is what the minister said. They are chilling words:

These are the same Conservatives who think that every immigrant is a potential terrorist and criminal and everything else and that they parade up and down and say that everybody that doesn't look lily white like them is some refugee from high-level detention. I can't take their argumentation seriously.

Then, in response to a question, he said:

Am I calling these guys racist? Like if this guy had your name on that, what would you call it? Aside from the fact that they are recognizable notwithstanding that they don't have their cowl and their cape, the Klan looks like it's still very much alive.

Then, just so that we understood fully that he knew what he was saying — and he was deliberate in what he was saying — in direct reference to the people holding the poster, he said:

I think these are a couple of fine upstanding members of the new Conservative Klan. So, you know, when I say that they have one standard for people who come here, who come here legitimately, and another for whatever suits their interests.

No one expects Minister Volpe to be pleased about the outrage and criticism the media is directing at his government. However, it is his obligation as a minister of the Crown to defend his party and to defend the very rights of all Canadians.

Rather than do his job and even attempt to restore confidence in his government, he has reacted to criticism by hurling defamatory insults. Minister Volpe has the moral responsibility to refrain from slandering his colleagues in the House of Commons. Political differences aside, it is categorically inconceivable that Minister Volpe actually believed that Mr. Richardson and Mr. Schmidt are members of the Ku Klux Klan. For launching such accusations, all the while drawing on emotionally charged references to cowls and capes, Mr. Volpe owes Canadians, Mr. Richardson, Mr. Schmidt and the Conservatives an apology.



Canada-Europe Parliamentary Association

Twenty-Eighth Interparliamentary Meeting with European Parliament's Delegation Responsible for Relations with Canada, March 27-31, 2005—Report Tabled

Hon. Lorna Milne: Honourable senators, pursuant to rule 23(6), I have the honour to table in the Senate, in both official languages, the report of the Canadian delegation of the Canada-Europe Parliamentary Association respecting its participation in the twenty-eighth interparliamentary meeting with the European Parliament's delegation responsible for relations with Canada, held in Brussels, Belgium, from March 27 to March 31, 2005.

Parliamentary Mission Regarding Next European Union Presidency, March 31-April 2, 2005—Report Tabled

Hon. Lorna Milne: Honourable senators, I have the honour to table in the Senate, in both official languages, the report of the Canadian delegation of the Canada-Europe Parliamentary Association respecting its participation in the parliamentary mission in the country that will hold the next European Union presidency, held in London, United Kingdom, from March 31 to April 2, 2005.


Assemblée parlementaire de la Francophonie

Meeting of Co-operation and Development Committee, March 14-15, 2005—Report Tabled

Hon. Rose-Marie Losier-Cool: Honourable senators, pursuant to rule 23(6), I have the honour to table in the Senate, in both official languages, the report of the Canadian delegation of the parliamentary association of the Assemblée parlementaire de la Francophonie (APF) regarding its participation in the meeting of the Co-operation and Development Committee of the APF, held in Lafayette and Carencro, Louisiana, on March 14 and 15, 2005.


Inter-Parliamentary Union

Meeting of Steering Committee of Twelve Plus Group, March 11, 2005—Report Tabled

Hon. Donald H. Oliver: Honourable senators, pursuant to rule 23(6), I have the honour to table in the Senate, in both official languages, the report of the Canadian delegation of the Canadian Group of the Inter-Parliamentary Union respecting its participation at the meeting of the Twelve Plus Steering Committee of the Inter-Parliamentary Union, held in Brussels, Belgium, March 11, 2005.

Forty-Ninth Session of Commission on Status of Women: Beijing +10, March 3, 2005—Report Tabled

Hon. Donald H. Oliver: Honourable senators, pursuant to rule 23(6), I have the honour to table in the Senate, in both official languages, the report of the Canadian delegation of the Canadian Group of the Inter-Parliamentary Union respecting its participation at the one-day parliamentary meeting on the occasion of the forty-ninth session of the Commission on the Status of Women: Beijing +10, held at the United Nations, in New York, March 3, 2005.

Notice of Inquiry

Hon. Joan Fraser: Honourable senators, pursuant to rule 57(2), I give notice that two days hence:

I will call the attention of the Senate to the work of the Inter-Parliamentary Union.


Citizenship and Immigration

Comments by Minister

Hon. Noël A. Kinsella (Leader of the Opposition): Honourable senators, I know that all honourable senators on both sides of this chamber will be saddened by the comments made in the scrum yesterday by a minister of the Crown. We are fully cognizant of the fact that sometimes custody of the tongue is not a habit that is well honed.

The statement by Minister Volpe has been alluded to already in statements by honourable senators. I am sure all honourable senators deem it unacceptable for a minister to compare members of the official opposition to members of a notorious white supremacist organization. I would ask the Leader of the Government in the Senate if he would not think it appropriate that the statement of his colleague be taken as a statement not well thought out and perhaps not literally intended. If indeed that was the position, I am sure my honourable friend opposite would want to distance the government from that statement.

Hon. Jack Austin (Leader of the Government): Honourable senators, I listened with interest to the statements of Senators Oliver and Tkachuk, and the question just put to me by Senator Kinsella.

It is obvious to all of us that we are living in political times that raise emotions. For example, senators may not be aware that a parliamentary colleague, John Reynolds, Member of Parliament for West Vancouver—Sunshine Coast—Sea to Sky Country, described all Liberals as whores.

An Hon. Senator: Oh, no. Shame on him.

Senator Austin: I am not sure that description was one that he would not want to retract.

Yes, Senator Mercer, he is a campaign director for the Conservative Party.

I do not think there is any woman in Parliament who can be described correctly as a whore. Whether or not he will apologize, I do not know.

I raise the issue because the times are tense, and sometimes things will be said that probably should not be said and probably are not appropriate.

Minister Volpe is of Italian descent and was born in Italy, and one can understand that the reference might be taken as offensive to the Italian community. I will further advise this chamber that the matter of Minister Volpe's statement is one for the other place.

Senator Kinsella: Honourable senators, I chose my words carefully when I raised my question in principle, and I will attempt to be equally restrained in my supplementary question.

In this instance, we are dealing with a minister of the Crown, that is to say, a member of Her Majesty's Privy Council who is part of this government. My question is whether this is a statement of government policy that the leader shares with Minister Volpe or is it not government policy? If it is not government policy, would the minister simply make a clear statement that calling members of the official opposition racist and making reference to the Ku Klux Klan is not part of this government's policy and that Minister Volpe was not expressing government policy?

Senator Austin: Honourable senators, I chose my words of answer to the first question by Senator Kinsella quite carefully, and I will let that answer stand.


Democratic Reform—Validity of Motions of Confidence

Hon. Terry Stratton (Deputy Leader of the Opposition): Honourable senators, my question is addressed to the Leader of the Government in the Senate. Yesterday in the other place, Paul Martin's Minister Responsible for Democratic Reform, Mauril Bélanger, dismissed the role of Parliament as merely "advisory." He clearly indicated that the Liberals would not honour any motions regarding confidence passed by the House of Commons.


He stated:

Mr. Speaker, as per the Constitution, various branches of government have various responsibilities. The legislative branch has certain responsibilities, as does the executive branch. In the capacity of their relationship, one of them has an advisory role. In some cases the advice is followed and in others it is not. Nevertheless, both the executive and the legislative can carry on as we do in the House.

Paul Martin is holding Canada and Parliament in contempt. Will the government leader acknowledge that motions concerning the confidence of this government are, in fact, questions of confidence or not?

Hon. Jack Austin (Leader of the Government): Honourable senators, I am not familiar with Minister Bélanger's statement, but I will inform myself. In the meantime, I can assure this chamber that constitutional conventions with respect to matters of confidence remain unchanged.

Senator Stratton: The Prime Minister has made grandiose statements about his respect for Parliament, and I wanted to raise that fundamental question because his minister brought that whole issue into dispute.

The Prime Minister has made grandiose statements previously. In the Hill Times of January 19, 2004, he is reported as having said:

It's a return to the representative and deliberative functions of the House of Commons. It's about members being restored to the centre of decision and policy making.

In Paul Martin's letter accompanying his action plan for democratic reform, February 4, 2004, he wrote:

We must reconnect Parliament to Canadians and renew the capacity of Parliamentarians — from all parties — to shape policy and legislation.

In his reply to the Speech from the Throne on October 6, 2004, Paul Martin said:

On this day, Parliament is at the centre of the national conversation. It must remain there.

However, as usual, there is a gap between his actions and his words. On several occasions, the Prime Minister has completely ignored majority decisions in the other place.

Will the government leader tell us when Paul Martin will start listening to the voices of members of Parliament and all Canadians, stop running this country like an absolute ruler and live up to some of the statements he has made, some of which I have just put on the record? Since he became leader and Prime Minister, he has repeated those remarks. Why would he not live up to them now?

Senator Austin: Honourable senators, I much enjoyed listening to the quotations that Senator Stratton gave us from the Prime Minister's presentation on the policies of this government with respect to democratic reform.

Where Senator Stratton and I differ dramatically is over whether this government has fulfilled its intentions with respect to empowering parliamentarians. In my view, individual parliamentarians are now far more free to express their constituents' and parliamentary objectives. Certainly, on the government side they are, and, of course, the Prime Minister was speaking for the government side while inviting the opposition side to join in the same practice.

In the other place, they have now adopted what is known as "one-line, two-line and three-line votes," with government members free to make their choice with respect to non-confidence measures. We saw just that on a vote on Bill C-38. It was interesting to note that the opposition members were of one persuasion with only the rarest of exceptions when that vote took place.

I believe that this government is following the policies of the Prime Minister, and I believe those policies are admirable.

With respect to Senator Stratton's question, I realize that the parliamentary tactics that may be ongoing in the other place will be somewhat frustrating to the opposition, but I know that there are expert parliamentarians on that side who understand the underlying events.

Senator Stratton: I thank the minister for his response. I realize that the vast majority of our caucus has a position with respect to Bill C-38. Therefore, to have an exception to a question or to have only a few opposing the opposition's position is not at all surprising.


Hon. Jean-Claude Rivest: Honourable senators, regarding the Honourable Prime Minister's policy on empowering parliamentarians and members of Parliament, can the minister tell us whether the Prime Minister held a caucus meeting before reaching his agreement with the NDP?

Senator De Bané: Of course, he did.


Senator Austin: I do not report to Parliament on Liberal caucus matters.


Changes to Budget 2005

Hon. W. David Angus: Honourable senators, speaking of stress levels, as described by Senator Cochrane and raised a little higher here by Senators Tkachuk and Kinsella, Canadians are becoming stressed as they recall the severe economic impact of the 1972-74 Liberal budget, propped up as it was by the NDP, when taxes climbed, spending soared and the budget surpluses that folks had enjoyed for a decade vanished suddenly into thin air.

In the National Post of April 28 under an article headed "Ottawa has not spent like this since Martin's dad was in cabinet:" Clement Gignac, chief economist and strategist for National Bank Financial, is quoted as saying:

If it's history repeating itself, you have to fasten your seatbelts...

We have to question regarding the long-term implications down the road.

In making this backroom deal with the NDP, did the government assess the risk and future impact that these changes would have on the Canadian economy and our global competitiveness, or did the government operate purely on political motive to secure a measly 19 votes to prop it up against the potential non-confidence motion?

Hon. Jack Austin (Leader of the Government): As I listened to Senator Angus' question, another of my famous vernacular phrases went through my head: "You have to be kidding in asking that question." For a Conservative senator to launch into the matter of budgets, comparing Liberal budgets with Conservative budgets is unthinkable. I would repeat, "You have to be kidding." The record is clear on which party has been successful in managing the Canadian economy.

Senator Angus: Clearly, the Progressive Conservative party under the great government of Brian Mulroney, but I am not here to answer the leader's questions.

An Hon. Senator: Are you still a member of that party?

Senator Angus: Great party it is, too.

In another article in the National Post on April 28, entitled "Two-headed beast spreads fiscal fear," Don Drummond, Chief Economist at the TD bank, stated:

Large businesses employ the bulk of Canadians...They also pay the highest wages, are the most productive, the most stable, have the best pensions and benefits and invest the money to create the jobs which Canadians need.

Yet, honourable senators, they are the ones penalized by this arrangement. Let us call it an "arrangement."

Could the Leader of the Government please explain why these drivers of our economies were sacrificed through the relinquishing of their much needed and deserved tax break?


Senator Austin: Honourable senators, I am really surprised. If I heard Senator Angus correctly, he said that large businesses employ the bulk of Canadians. That is not correct. Small and medium enterprises in this country employ the bulk of Canadians. Under this budget, small and medium enterprises are given tax deductions and tax credits to make them more competitive and to allow them to grow.

Honourable senators, these are businesses not only in urban communities but in rural communities across the country. When I say rural communities, I am referring to communities that are represented at the moment by only Conservative MPs in the other place. When those constituents discover that the Conservative Party wants to defeat a budget that provides credits and incentives for small and medium business, they will think about their voting.

Senator Angus: Are you sending a message?

Senator Stratton: Do you want to bet on that?

Senator Angus: Which budget? It changes every day. I understand it has just changed again. Should we send a message to the other place that tax breaks for business is on again?

Honourable senators, it is becoming increasingly evident just how desperate this government is to maintain the reigns of power. They keep changing their minds every five minutes. Now they are putting the financial stability of our great nation at risk for simple political means. History has taught us that Liberal-NDP coalitions are a recipe for sharp increases in government spending, higher inflation and a decrease in investor confidence.

I ask the minister once again about the consultation and risk assessment process the government used in creating this new coalition and amended budget in order to achieve political gain. What exactly is the Government of Canada trying to hide regarding the exact terms and conditions of this so-called unsigned but binding agreement?

Senator Austin: Honourable senators, Senator Angus must be kidding when he raises the issue of policy changes because there is nothing more breathtaking than the policy changes that we are seeing from the Conservative Party with regard to cities, health care and child care. I could go down a long list. It is quite amazing to see the opportunism of this Conservative Party. They had principles they adhered to at one time which distinguished them from the Liberal Party, but today they are just a fake copy of Liberal Party policy. One of the great axioms of politics is that if the people want a Liberal Party, they will choose a real Liberal Party, not a fake Liberal Party.

The Hon. the Speaker: I rise to remind all honourable senators that it can be very difficult to hear the questions and the answers if there is too much interference by way of heckling or comment from senators' seats.

Prime Minister

Use of Private Health Care Facilities

Hon. Terry Stratton (Deputy Leader of the Opposition): Honourable senators, my question deals with health care. Does the Prime Minister of Canada visit private health care facilities or does he not? Yes or no?

Hon. Jack Austin (Leader of the Government): Honourable senators, I will have to obtain the answer to that question because I am not personally familiar with his health care plans.

I want to comment on whether Senator Stratton is asking a question about the Prime Minister's health. If he is, I can assure him that the Prime Minister is very healthy and is in shape to carry out any election campaign that may take place.

Senator Stratton: Going to private health care facilities would aid and abet that completely.


Vote on Budget 2005

Hon. Gerry St. Germain: In regard to Senator Angus' question, honourable senators, I have a supplementary. If the Leader of the Government in the Senate is so secure in his position, why are the Liberals filibustering their own legislation in the other place? Why not present the budget? If it is that great a budget, let them vote on it over there.

To use an analogy mentioned this morning, the position that the Liberal government finds itself in is like leaving the Enron executives in charge of the corporation while they are going through a judicial process in the United States. If there is all that confidence in this great budget that has been put together by the Liberals and their buddies, the NDP, why not allow a vote in the House of Commons?

Hon. Jack Austin (Leader of the Government): Honourable senators, first, the illustration that Senator St. Germain refers to is very strained, and I will not try to deal with it.

I wish to remind honourable senators that all parliamentarians are in a process of placing before the people of Canada our various programs. With respect to the budget as contained in Bill C-43, the Government of Canada is carrying out the normal process of presenting the merits of this budget to Canadians. We are finding that Canadians across the country want this budget passed. Of course, when we are ready, we will present this budget. We are waiting, and we will not wait too long, for the Conservative Party to go back to its first position, which is to support this budget so that the Atlantic accord can be passed, so that health care can be funded, so that Kyoto has its funding, so that child care has its money and so that cities have their money. Canadians want these programs and we want the Conservatives to see that Canadians want these programs. We want the Conservative to support those programs.


Changes to Budget 2005—Funding of Commitments

Hon. Donald H. Oliver: Honourable senators, my question is for the Leader of the Government in the Senate. On May 4, The Globe and Mail quoted New Democrat MP Pat Martin as saying:

I've gotten a very clear message from first nations leadership and from Liberal cabinet ministers that the money that was intended to be announced on May 31 has been redirected to form part of the NDP budget. The government intends to pay for its commitments to the NDP with money that they had already committed to first nations. If that's the case, it's even sleazier than I had ever imagined.

Given that the government has backed away from its plan to pay for this deal through business taxes, does it now in fact intend to meet the cost of the new budget with funds that were originally to be announced on May 31 for First Nations?

Hon. Jack Austin (Leader of the Government): Honourable senators, I do not take responsibility for the comments of a private member in the other place.

Senator Oliver: Could the Honourable Leader of the Government in the Senate answer the question: How will the government pay for the commitments to the NDP, and will the First Nations have the money that was to be announced on May 31?


Senator Austin: Honourable senators, the Minister of Finance has announced that the budget will accommodate the possible additional spending. I spoke yesterday of $2.3 billion in each of the next two years to be included with the government's budget measures. The Minister of Finance has made it clear that this government will not go into deficit and that no arrangements in the budget will be carried out if there is any concern with respect to deficit or contingency reserves.

Senator Oliver: Honourable senators, in Wednesday's Ottawa Citizen we were told:

Government Senate leader Jack Austin said Monday the Liberal-controlled Senate would work as long as required to pass the federal budget, hinting he will drag the senators into July sittings to approve the necessary budgetary legislation, probably including a separate bill for the additional $4.6 billion in spending.

Honourable senators, I am hoping that the government leader can provide a bit of clarification. Last week the Prime Minister said that the extra spending would only go ahead if there is still a surplus at the end of the fiscal year. The end of the fiscal year is March 2006, not July 2005.

Does the government hope to legislate this $4.6 billion now or does it hope to legislate it toward the end of the fiscal year when it is known whether there is still a surplus?

Senator Austin: Honourable senators, the two points raised by Senator Oliver are unconnected. I have just answered the second point, that is, with respect to budgetary management. With respect to the passage of Bill C-43, to which I was referring, I cannot believe that anyone in this chamber would not want to see that budget passed by this chamber, and I cannot believe that we would not want to work to ensure that budget would be passed.

Of course, I have just given additional encouragement to Senator St. Germain, who was worried about whether we would apply ourselves to the budget.

Fisheries and Oceans

Foreign Fishing—Comments by Prime Minister

Hon. Gerald J. Comeau: Honourable senators, my question is also directed to the minister. The Prime Minister railed against foreign overfishing on the weekend. He said:

Clearly, overfishing takes an environmental toll. But make no mistake: it takes an economic toll of staggering proportions. Worst of all, it takes a human toll...this cannot go on. We cannot allow it to go on.

It is unconscionable that even now, even given the perilous state of our fisheries...overfishing continues off the nose and the tail of the Grand Banks by foreign government will not stand by and watch it happen.

Could the minister tell us how the Prime Minister will translate those words into action to protect this very valuable and precious commodity that Canadian fishing fleets used to be able to access and that is now being overfished by foreign pirates?

Senator St. Germain: Brian Tobin for leader.

Hon. Jack Austin (Leader of the Government): Is Senator St. Germain a supporter of Brian Tobin?

Where is Senator Furey? We will let him know as quickly as we can.

Senator St. Germain: He is my one Liberal friend.

Senator Austin: Senator St. Germain, I am so hurt. I thought we were friends.

The Hon. the Speaker: Honourable senators, I am having great difficulty hearing the proceedings. I ask for order.

Senator Austin has the floor responding to the question of Senator Comeau.

Senator Austin: Honourable senators, let me thank Senator Comeau for quoting the Prime Minister and putting the government's policy clearly on the record of the Debates of the Senate.

How this will be done is under active consideration at this time. The Prime Minister has been given a range of options. Our goal is clear and the methodology is being carefully considered.

Senator Comeau: Honourable senators, "under active consideration" sounds somewhat like "in the fullness of time."

Senator Austin: No, it is faster.

Senator Comeau: I would like to quote what the Prime Minister said two years ago, on May 6, 2003. He stated:

The time for talk is over: for too long we've asked our fishermen to bear the burden while we've allowed foreign fishermen to get away with sheer irresponsibility and murder...

He continued:

We have to hold their feet to the fire. We will look at all options...and I am telling you if one of these options is to impose our environmental management on the nose and tail of the Grand Banks, then if that's our option, then we are going to have to exercise it... Ensuring the viability of fish stocks is a responsibility that we as a sovereign nation have to our people and to our children and we will have to exercise our responsibility.

In the fullness of time, or with active consideration, this situation continues. The fish stocks keep dwindling and our people keep losing their jobs in the fish plants due to overfishing.

We cannot go through another election campaign with only words. It is now time to put words into action. Will the Prime Minister commit to custodial management on the nose and tail of the Grand Banks of Newfoundland?

Senator Austin: Honourable senators, I want to thank Senator Comeau again for putting the Prime Minister's statement on the record of the Debates of the Senate. I want to thank him, additionally, for making his own position clear. Perhaps that is also the position of the Conservative Party with respect to the action that should be taken by Canada with regard to the nose and tail.

As honourable senators know, that action would have to be taken unilaterally and against current agreements, the terms and details of which Senator Comeau is quite familiar with. That action, as recommended by Senator Comeau, would put Canada in conflict with the European Community.

Whether that is one of the options being considered I cannot say today, but I will certainly put Senator Comeau's representation before the Minister of Fisheries and Oceans.

Senator Comeau: Honourable senators, I hope the Leader of the Government in the Senate does that. I am very much in favour of custodial management. Rather than speaking for the Conservative Party, I speak for myself on this issue. I hope that the minister in this house will convey his own support for this position to the Prime Minister.

Senator Austin: I will send Senator Comeau's representation to both the Prime Minister and the Minister of Fisheries and Oceans.


Pages Exchange Program with House of Commons

The Hon. the Speaker: Honourable senators, before proceeding to Orders of the Day, I wish to draw to your attention the presence of two pages from the House of Commons. First I would like to introduce Travis Ladouceur from Fort-Coulonge, Quebec. He is a student at the faculty of education at the Université du Québec en Ouatouais, where he is specializing in preschool and primary education. Welcome to the Senate, Mr. Ladouceur.

I would also like to introduce David Maisonneuve. He hails from Guy, Alberta, and is a student at the faculty of social sciences at the University of Ottawa, where he specializes in political science.

On behalf of all honourable senators, I welcome you to the Senate.



Business of the Senate


Hon. Noël A. Kinsella (Leader of the Opposition): Honourable senators, before we move on to Government Business, given that the representative of the government in the Senate does not wish to dissociate the government from the racist statements of Minister Volpe with regard to the KKK, it is very difficult for members of the opposition in the Senate to be enthusiastic about working on government business, as sparse as that government business may be.

Therefore, pursuant to rule 15, I move:

That the Senate do now adjourn.

The Hon. the Speaker: Honourable senators, rule 15 reads:

(1) A motion to adjourn the Senate, unless otherwise prohibited in these rules or unless otherwise ordered by the Senate, shall always be in order.

(2) A motion to adjourn the Senate can only be moved when the Senator moving the motion has the floor to speak to a question before the Senate and not on a point of order.

(3) When a motion is moved, in accordance with the provisions of sections (1) and (2) above, the Speaker shall put the question forthwith without debate or amendment.

Honourable senators, Senator Kinsella rose. I was not sure whether he was rising on a point of order or on house business. In any event, I recognized him. He put his motion, and it is before the house.

Is it your pleasure, honourable senators, to adopt the motion?

Some Hon. Senators: No.

Some Hon. Senators: Yes.

The Hon. the Speaker: Will those honourable senators in favour of the motion to adjourn please say "yea"?

Some Hon. Senators: Yea.

The Hon. the Speaker: Will those honourable senators opposed to the motion to adjourn will please say "nay"?

Some Hon. Senators: Nay.

The Hon. the Speaker: In my opinion, the "nays" have it.

And two honourable senators having risen:

The Hon. the Speaker: Call in the senators. There will be a one-hour bell.


Motioned negatived on the following division:


Andreychuk LeBreton
Buchanan Lynch-Staunton
Cochrane Oliver
Comeau Prud'homme
Cools Rivest
Di Nino St. Germain
Johnson Stratton
Kelleher Tkachuk—17


Adams Joyal
Austin Lapointe
Bacon Lavigne
Baker Léger
Banks Losier-Cool
Bryden Maheu
Callbeck Mahovlich
Carstairs Massicotte
Chaput Mercer
Christensen Merchant
Cook Milne
Corbin Mitchell
Cordy Moore
Cowan Munson
Dallaire Nancy Ruth
Day Pearson
Downe Pépin
Dyck Phalen
Fairbairn Pitfield
Ferretti Barth Poulin
Finnerty Ringuette
Fitzpatrick Robichaud
Fraser Rompkey
Furey Smith
Gill Stollery
Grafstein Tardif
Hubley Trenholme Counsell
Jaffer Watt—56




Hon. Pierre De Bané: Honourable senators, I was not present when His Honour put the question, and so I did not vote. I am sorry to have been absent at that time.


Budget Implementation Bill, 2004, No. 2

Third Reading—Debate Adjourned

Hon. Joseph A. Day moved the third reading of Bill C-33, a second act to implement certain provisions of the budget tabled in Parliament on March 23, 2004.

He said: Honourable senators, I appreciate the opportunity to present Bill C-33 for third reading. As honourable senators have just heard, the bill is the second budget implementation bill of the budget of 2004. In addition, proposals from that year's budget concerning the Air Travellers Security Charge, legislation enabling interested Indian bands in Quebec to enter into sales tax agreements with the Government of Quebec, income tax relief to Armed Forces personnel serving in dangerous settings, and relief for disability caregivers are also included in Bill C-33.

Honourable senators, I will avoid the temptation to deal with only two aspects of this bill. The two aspects that were dealt with in committee and took up a great deal of time were with respect to charities and the General Anti-Avoidance Rule. I will give a brief outline of the outcome, as I perceive it, of our committee deliberations. I think it is important when I stand here as sponsor of the bill and ask for support of this legislation that I put those two items in perspective. I also want to refer to the many other aspects of this bill that I submit are very important government initiatives.

Before I begin, honourable senators, I wish to thank those members of the National Finance Committee who participated in the long and sometimes difficult hearings that we had with respect to technical issues. Their diligent efforts over several days of hearings are much appreciated.


Permit me to reflect on the new agenda for achievement set out by the government in Budget 2004 to illustrate how Bill C-33 fits into that. At the heart of Budget 2004 is the recognition that we continue to work toward improving the standard of living for all Canadians. We must also work toward improving fairness and the integrity of our tax system. Those goals form the integral part of the agenda set out in Budget 2004. Indeed, the measures in last year's budget were designed to respond to priorities identified by Canadians; and the initiatives contained in Bill C-33 reflect those priorities, which I will discuss. Those are: health, learning, communities, the economy, our place in the world, and the fairness and integrity of the tax system. I will conclude with two other tax measures found in the bill.

In respect of health, the Technical Advisory Committee on Tax Measures for Persons with Disabilities was formed in 2003 to advise the Minister of Finance and the Minister of National Revenue on ways to improve the tax system to help Canadians with disabilities. Bill C-33 responds to the committee's proposal to strengthen tax assistance for Canadians with disabilities. Beginning with the 2004 tax year, when Bill C-33 is passed, expenses for sign language interpreters and talking textbooks will be legitimate deductions against income if the expenses are incurred for educational or employment purposes. Therefore, income used to pay for these expenses will not be taxed and it will not affect income tested benefits. Bill C-33 also contains a measure to allow caregivers of persons with disabilities to claim more of the medical and disability-related expenses they incur on behalf of dependent relatives. This will benefit many Canadians who care for disabled family members.

Honourable senators, Budget 2004 introduced a number of initiatives to help families save for their children's education. As honourable senators are aware, education is a life-long pursuit and is not restricted to youth. Tax measures proposed in this bill will help taxpayers continue their education while they are in the workforce. Currently, the education tax credit for the non-tuition costs of post-secondary education and training, such as textbooks, apply only to students enrolled in a full-time or part-time educational institution. People who pursue work-related learning can be left out because employed individuals are not eligible to claim the credit relevant to the cost of programs directly connected with their current employment. This applies even if the employees pay for the courses.

To help more students and taxpayers undertake life-long learning connected to their jobs, Bill C-33 proposes that, effective January 1, 2004, taxpayers will be allowed to claim the education tax credit for education related to current employment where the costs are not reimbursed by the employer. This measure makes the tax system fairer by giving Canadians who are upgrading their work skills access to the same tax benefit that is available to other post-secondary students.

Another priority in Budget 2004 is our communities, and Canadians' recognition of the importance of non-profit organizations. Indeed, we rely on them for the delivery of services related to a variety of items such as education, the environment, and cultural and social activities. We heard from witnesses before the Finance Committee that there are 161,000 non-profit organizations and charities in Canada. Together, non-profit and voluntary sector groups contribute $75.9 billion annually to the economy, which represents about 8.5 per cent of the GDP. In addition, about 2 billion volunteer hours are provided to charities annually by 2 million Canadian workers who choose to make their communities and their country a better place for all of us through their participation.

In recognition of the contribution of these organizations to Canadian society, Budget 2004 contains a variety of initiatives that will benefit the voluntary sector, some of which appeared before the committee.

Honourable senators, it is important to recall that in March of 2003 there was an initiative between the Government of Canada and the voluntary sector to examine and report on the rules that govern charities under the Income Tax Act. After extensive consultation, the Joint Regulatory Table reported 75 recommendations to government for improvements to those rules.

In response to the report, Bill C-33 proposes a number of significant improvements to the regulatory framework for registered charities. During the hearings, witnesses from the voluntary sector told the committee that they were supportive of the process leading to the changes in respect of registered charities. However, they were concerned that certain initiatives would be burdensome to some charities, such as the annual disbursement quota that had not been fully discussed before the Joint Regulatory Table. The committee told us that it is a complex system that may serve as an irritant for smaller organizations in the voluntary sector and may lead to non-compliance as volunteers struggle to understand rules that even professionals may have difficulty understanding. The government is urged to continue the consultation and discussion process with the voluntary sector in pursuit of a resolution to these concerns expressed to the committee and to further improve the rules relating to this important sector of our society.

Honourable senators, in the area of the economy, Bill C-33 proposes certain initiatives, in particular with respect to small and medium-sized businesses. The bill proposes to extend the non-capital loss carry forward for a period of 10 years. This will benefit innovative start-up businesses that may experience losses while new products and new technologies are being developed.

Another important initiative proposed in the bill is designed to encourage small businesses to conduct scientific research and experimental development, and to facilitate raising funds from investors through an enhanced tax credit.


Honourable senators, the next area I would refer to is our place in the world. More than ever, Canadians are thinking, living and acting internationally. The face of Canada seen around the world is often that of the brave men and women of our Armed Forces and our police. Indeed, Canada has a proud history of responding to threats to global security and contributing to peacemaking and peacekeeping efforts around the world. Our soldiers and police are often involved in dangerous assignments and, for that, they deserve our thanks.

In recognition of their service to Canada, Bill C-33 contains a measure aimed specifically at helping these soldiers and their families. When Canadian soldiers and police are on high-risk missions overseas, they will no longer be required to pay income tax on their income earned while deployed on these missions. That tax relief will come if and when we pass this bill. The relief will apply on income up to the highest level of pay earned by a non-commissioned member of the Canadian Forces.

I would now mention the initiative in Bill C-33 intended to prevent abuse of our tax system. I am speaking of the proposal to clarify certain applications to the General Anti-Avoidance Rule that was enacted by Parliament in 1988. The aim of this rule is to protect the tax system against abusive tax avoidance, as such tax avoidance undermines the fairness and integrity of the tax system. If some taxpayers can abuse the system and thereby avoid paying tax, others will be required to pay more.

The clarification does not preclude good tax planning; neither does this proposed amendment change the General Anti-Avoidance Rule that has existed since 1988 in the act. Rather, this clarification would ensure that everyone understands the position that has been taken by Revenue Canada from the beginning in 1988 that the rule applies not only to the act, but equally to regulations that flow from the act and international treaties based on avoiding double taxation that flow from national tax legislation.

In short, this proposal seeks to ensure that Canada Revenue Agency has the authority to challenge transactions that abuse our tax system. If the scheme is not abusive, then this amendment would have no application.

According to some witnesses, the proposed amendments to the Income Tax Act will expand the range of transactions to which the General Anti-Avoidance Rule may apply. Others strongly disagreed, including the minister and some practitioners. The Canadian Bar Association and the Institute of Chartered Accountants confirmed the point made by the minister that the position of the government from 1988 forward is that the GAAR, the General Anti-Avoidance Rule, applied to regulations as well as tax treaties in addition to the act. The Canadian Bar Association and the Institute of Chartered Accountants, however, said that some of their professional advisor members did not agree with that position and were prepared to advise their clients that there may be the possibility of arguing the position in court.

The point, honourable senators, and it is a critical point, is that the position of the government was known throughout that this applied to regulations and to tax treaties.

Other measures, honourable senators, in Bill C-33 that I should like to touch on briefly are the non-income tax measures. One is a reduction in the Air Traveller Security Charge. The Air Traveller Security Charge was first introduced in 2001. The government has been monitoring the amount of money spent and the amount of money taken in and has determined, in Budget 2004, that a reduction would be appropriate if this bill is passed. In that instance, the Air Traveller Security Charge would be $6 for one-way travel or $12 for a round trip.

The proposals in this bill provide the legislative authority for those reductions, which apply to tickets purchased on or after April 1, 2004. These reductions illustrate that the government continues to honour its commitment to review this charge to ensure that revenue remains in line with planned expenditures over a five-year period.

Honourable senators, I mentioned briefly at the beginning of my remarks that First Nations have expressed an interest in entering arrangements whereby they can collect, within their area, a tax similar to a goods and service tax, and that requires legislative approval. There has been some expression of interest by the Province of Quebec and First Nations in that province to enter into such an arrangement, and the approval is contained in Bill C-33 to allow that to occur.

In conclusion, I trust that my comments have convinced honourable senators that there are many significant government provisions in Bill C-33, arising out of the budget of 2004, which are deserving of your support. These are important matters, and I respectfully request your support for this legislation.

On motion of Senator Oliver, debate adjourned.

Judges Act

Bill to Amend—Second Reading—Debate Continued

On the Order:

Resuming debate on the motion of the Honourable Senator Cools, seconded by the Honourable Senator Keon, for the second reading of Bill S-8, to amend the Judges Act.—(Honourable Senator Cools)

Hon. Anne C. Cools: Honourable senators, I was planning to speak to this order today, but our time has run out. I do not want to ask that the order stand because, should that request be granted, I will lose a day. It will not be spoken to if I cannot begin my speech today because we will have run out of time.

Hon. Bill Rompkey (Deputy Leader of the Government): Perhaps we could agree not to see the clock. Before I deal with that I would refer to the fact that Senator St. Germain's bill, Bill S-16, has been referred to committee. It should, however, remain on the Order Paper so that when it is reported from committee it will be on the Order Paper.

The Hon. the Speaker: Before I see four o'clock, I will try to dispose of these two matters.

First, Senator Cools, I take it that you will begin your remarks, which will give you additional time, and that you will adjourn the debate in order to resume your remarks. Is that correct?

Senator Cools: Yes.

On motion of Senator Cools, debate adjourned.

First Nations Government Recognition Bill

Second Reading—Debate Continued

On the Order:

Resuming debate on the motion of the Honourable Senator St. Germain, P.C., seconded by the Honourable Senator LeBreton, for the second reading of Bill S-16, providing for the Crown's recognition of self-governing First Nations of Canada.—(Subject matter referred to the Standing Senate Committee on Aboriginal Peoples on February 22, 2005)

The Hon. the Speaker: Is it agreed, honourable senators, that Item No. 7, Bill S-16, the subject matter of which has been referred to committee, remain on the Order Paper until such time as the committee has reported back to this chamber?

Hon. Senators: Agreed.

The Senate adjourned until Thursday, May 5, 2005, at 1:30 p.m.