[Recorded by Electronic Apparatus]
Wednesday, April 9, 1997
.1618 
[English]
The Chairman (Mr. Lyle Vanclief (Prince Edward - Hastings, Lib.)): I call the meeting to order and thank everyone for being present. We are still on consideration of Bill C-72, the amendments to the Canadian Wheat Board Act. We are prepared to start on clause-by-clause.
Mr. Leon E. Benoit (Vegreville, Ref.): Mr. Chairman, before you start on clause-by-clause, I'd like to table some documents that were requested by Marlene Cowling at the March 11 meeting. At that time, she commented that I had made a sweeping statement about poll results that suggested dual marketing was the marketing choice of farmers. She then said:
- For the record, I would request that Mr. Benoit table the factual documentation that supports
what he has said so it can be used by this committee, if that is in fact true.
- I'm just doing that at this time.
The Chairman: I think we already have those, but if you want -
Mr. Leon E. Benoit: So you know the results there.
The Chairman: Oh, of the Alberta plebiscite. I'm sorry, go ahead.
Mr. Leon E. Benoit: It shows that about 66% of Alberta farmers supported dual marketing in barley, and 62% did so in wheat. That certainly supports those statements.
The second is a poll I did in December in the Vegreville and Beaver River constituencies. It was commissioned by me and was done by a professional polling outfit out of Edmonton, Teleresearch Inc. This poll showed that 87% of all farmers who answered the survey - and it was a large survey - in the Vegreville constituency supported dual marketing, while 13% did not. In Beaver River 95% supported dual marketing, while 5% not. So I'll table that document.
.1620
The third is a study that you're aware of, so I won't get into the details of it. It was commissioned by the Saskatchewan government and was done by the Department of Agriculture and Food through Anderson Fast Market Research of Regina. It shows that roughly 56% or 57% of farmers in Saskatchewan support dual marketing rather than the board monopoly.
The fourth document is the final report and recommendations of the Western Grain Marketing Panel. In that study - which was done by your Liberal government, as you well know - there is a chart that shows that 55% of the farmers who responded wanted barley to be marketed under a voluntary wheat board system. Only 42% didn't want that.
I table these documents so that the members of the governing party can examine the evidence and really determine that it's pretty much a waste of time to be talking about this piece of legislation. We should instead be putting in place a voluntary wheat board.
The Chairman: I thank you for tabling that, Mr. Benoit.
Mr. Easter, do you have a comment?
Mr. Wayne Easter (Malpeque, Lib.): Yes, Mr. Chairman. While we're into the tabling of documents, I have something as well. It's called ``The Economics of Single Desk Selling of Western Canadian Grain'', by Collin, Carter, and Loyns. The key clause in it is that ``Prices did fall in the continental barley market period'' - this was when Charlie Mayer violated the system for a little while - ``shown between the two solid vertical lines.''
So I'll table that information, Mr. Chairman.
The Chairman: Thank you very much, Mr. Easter.
Mr. Wayne Easter: I wanted to point that out, because, sure as the devil, you guys would miss it.
The Chairman: We're not going to read all of these documents into the record. I'm sure everyone will want to read them at their leisure as soon as they get them. During the next seven or eight weeks, I'm sure you're all going to have time to read some of this material.
Mr. Chrétien.
[Translation]
Mr. Jean-Guy Chrétien (Frontenac, B.Q.): If I understand correctly, we will be called at 5:15 p.m. for a 5:30 vote, which means we have about one hour. Moreover, I myself must leave at 4:30. In view of the lack of time, I would like to ask the government party if they would agree to adjourn, or to postpone the meeting this afternoon.
[English]
The Chairman: From the chair, I'll rule that we had set the date and time for the meeting. I believe everybody was notified as far ahead as is usual for these meetings. I can't see that we adjourn the meeting because one of us has another commitment. We know there will be bells, and of course we usually adjourn to go to vote in the House. I'm at the direction of the committee if you wish, but I see no reason why we should.
Mr. Benoit.
Mr. Leon E. Benoit: Mr. Chairman, how much time has been scheduled for this meeting? Does it end at five o'clock?
The Chairman: We end at the bells.
Mr. Leon E. Benoit: Which is about what time?
The Chairman: You tell me when the bells are for sure, and we'll end at the bells. You know as well as I do -
Mr. Leon E. Benoit: Well, the case will be carried for the day, so the bells may not be tonight.
The Chairman: It's my understanding that everybody expects the bells around 5:30.
Mr. Leon E. Benoit: Oh, the closing, okay. It's just that two of us have to leave at five.
The Chairman: That's the notice I've been given on the bells. Because it was the anticipation of everyone, we'll go until around 5:30 and then reconvene.
Mr. Clerk, the notice is for 10:30 a.m. tomorrow.
Mr. Chrétien.
[Translation]
Mr. Jean-Guy Chrétien: I understand, Mr. Chairman. I have to tell you, though, that I've just had a chat with Jerry Pickard who asked me to co-operate, which I agreed to do, as usual, and I would like to point out that one good turn deserves another. Thank you.
.1625
[English]
The Chairman: We tried that two or three weeks ago, Mr. Chrétien, and it didn't work. We tried to scratch your back, but you didn't want to scratch back.
Do I have any direction from the committee? If not, I'm going to proceed with the meeting this afternoon as planned.
I know we've all been working on this bill for some time. Because it's a bill that amends others, it's sometimes a little tricky for us to understand just exactly which clause we're talking about. You may have to help us at times, but I will try to make the best effort to make sure that we're referring to the right clause in the bill. For example, you'll see a ``1'' and then a whole bunch of other numbers, because it's referring to sections of what I refer to as the main Canadian Wheat Board Act.
There is no title to this bill, so we immediately start on clause 1. I'm not aware of any amendments that are before the committee for clause 1. Shall clause 1 carry?
Mr. Elwin Hermanson (Kindersley - Lloydminster, Ref.): No.
The Chairman: On division?
An hon. member: No.
The Chairman: There are no amendments to clause 1.
Mr. Leon E. Benoit: We'll call for a vote.
The Chairman: Shall clause 1 carry on division?
Some hon. members: Carried.
Some hon. members: No.
The Chairman: Are you formally calling for a vote or not? Make up your mind.
Mr. Elwin Hermanson: On division.
Clause 1 agreed to on division
On clause 2
The Chairman: Clause 2 is on page 2 of the bill. It starts about two-thirds of the way down. The bold print in the act says ``The Act is amended by adding the following after section 2''. That's where we are.
There are no amendments before the committee for clause 2. Shall clause 2 carry?
Mr. Leon E. Benoit: I have a couple of questions.
The Chairman: Go ahead, Mr. Benoit.
Mr. Leon E. Benoit: In subclause 1(8), listed among the provinces that are in the designated area it says ``parts of the Province of Ontario lying in the Western Division'' -
The Chairman: Leon, can we make sure that we're where you are.
Mr. Leon E. Benoit: Yes, it's on page 2 of the bill, under subclause 1(8).
The Chairman: You're still on clause 1, Leon? Clause 1 has carried.
Mr. Leon E. Benoit: Oh, I'm sorry.
The Chairman: That's what I said at the beginning. You have to hang with us here, because -
Mr. Leon E. Benoit: I was too slow on that. That's fine.
The Chairman: I don't want to rush it through, but that is the difficulty, because we have a lot of sub-numbers, etc., here.
Are there any discussions on clause 2? Elwin.
Mr. Elwin Hermanson: I have a question. Perhaps our legal counsel could help us.
Recently the Government of Alberta indicated that if this bill passes in its present form, Alberta may wish to set up some type of an exporting agency provincially. If clause 2 carries, I want to know if that would preclude any province from exporting wheat or barley, thereby taking that control away from the Canadian Wheat Board. Right now the Canadian Wheat Board has the sole power to export.
The Chairman: There is no legal counsel here. There are legislative clerks here. Can the department officials address that - Mr. Pickard or Mr. Migie?
Mr. Jerry Pickard (Parliamentary Secretary to Minister of Agriculture and Agri-Food): It's my understanding that the act does have a binding relation with the province. The province would therefore fall under the stipulations of the act in any sale. That means they would fall under the jurisdiction of sales through the Wheat Board.
.1630
Mr. Elwin Hermanson: Mr. Chairman, I don't want to be difficult, but I thought we would have legal counsel here when we did clause-by-clause. I've never done clause-by-clause without having someone sitting at the table -
The Chairman: Does the department have any legal counsel here?
Mr. Howard Migie (Director General, Adaptation and Grain Policy Directorate, Policy Branch, Department of Agriculture and Agri-Food): Yes, we do.
[Translation]
Mr. Jean-Guy Chrétien: Since we have no legal adviser present, we can adjourn the meeting. Is there no response?
[English]
Mr. Pickard: There is legal counsel here if you wish legal counsel.
An hon. member: Members' legal counsel or departmental legal counsel?
Mr. Migie: Departmental legal counsel.
The Chairman: There has never been a request by the committee, or any members of the committee, to have legal counsel present, but there is legal counsel here in the room. We'll ask them to come to the table. It's not necessary that there be legal counsel here for the committee, but there is legal counsel here.
Howard, would you please introduce counsel for the record.
Mr. Migie: This is David Byer from Justice Canada, assigned to Agriculture and Agri-Food Canada.
Mr. Elwin Hermanson: Do you want me to repeat my question, Mr. Chairman?
The Chairman: I think Mr. Byer is clear -
Mr. David Byer (Legal Counsel, Department of Justice): No, I would like the question again.
The Chairman: Please repeat your question, Elwin, if you will.
Mr. Elwin Hermanson: If clause 2, which makes this act binding upon the provinces, passes, could a province that is very unhappy with the bill, such as the province of Alberta...or, for that matter, a designated area that isn't included under the designated area come under the bill? Is there enough flexibility, or is this locked in place and no province could export wheat or barley outside of the Canadian Wheat Board if we pass clause 2 as it is? It has broader ramifications, but that's my primary concern.
Mr. Byer: If I understand you correctly, you're asking whether, if this clause carries as it's amended, it would preclude any province from exporting wheat or barley.
Mr. Elwin Hermanson: If the province of Alberta wanted to set up a provincial wheat exporting agency to be the agency that exports Alberta wheat or barley - and there's been some discussion, so this isn't just academic; I'm sure their legal experts are looking into it - and if clause 2 passes, is this binding upon the province in such a way that they could not legally export wheat or barley under some kind of provincial agency?
Mr. Byer: The clause states very clearly that the act will be binding on Her Majesty in right of Canada or a province. So the purpose and direction of the clause is to bind the Crown, whether it be a provincial or federal crown.
Mr. Elwin Hermanson: Would that apply to the board's exclusive ability to export wheat and barley?
You can't export a bushel of wheat or barley unless you get a licence from the Canadian Wheat Board. If this clause passes, does it mean a province couldn't legally, if they set up an agency, export wheat or barley? Right now an individual can, because they're under the jurisdiction of the Canadian Wheat Board if they're in a designated area. It's not as clear whether the current Wheat Board Act can impose that power upon the provinces.
I want to know, if clause 2 passes will that power also be imposed upon the provinces?
Mr. Byer: As I understand it, at the present time even provinces that are not in the designated area are under the jurisdiction of the Canadian Wheat Board.
Mr. Elwin Hermanson: That's right.
Mr. Byer: If their producers wish to export, they require a licence from the Canadian Wheat Board to do so. There is jurisprudence going back quite a number of years now that reinforces the exclusive jurisdiction of the board.
Mr. Elwin Hermanson: So my understanding is correct, then, that a province couldn't set up an agency to export.
Mr. Byer: That's right. It's our position that they couldn't do it now, and certainly with this amendment they still couldn't do it.
The Chairman: Further on that, I think all the committee members received some weeks ago clause-by-clause comments.
In that document, Mr. Hermanson, it says:
- Clause 2 defines the Act to be binding on both Canada and a province. [Although this is already
considered to be the case, it is hereby being made explicit that a provincial government is bound
by the Act.]
The Chairman: I'm not a lawyer, but Quebec is part of Canada, and the act applies to every province. Quebec is a province of Canada, so it follows, in my humble mind, that it would apply.
.1635
Mr. Elwin Hermanson: So a distinct society resolution has no power over this act.
The Chairman: As I say, I'm not a lawyer, but Quebec is a province of Canada. This act applies to all the provinces of Canada. It therefore would apply to wheat exported by anybody out of the province of Quebec - unless I stand corrected by the legal counsel.
Mr. Leon E. Benoit: I have a question on this as well.
The Chairman: Sorry, Mr. Benoit, Mr. Hoeppner is ahead of you, then Mr. Chrétien and then you.
Mr. Jake E. Hoeppner (Lisgar - Marquette, Ref.): This leads up to another question,Mr. Chairman. As you know, I provided some information on the court case that Ben-Ron and M-Jay Farms were involved in. There we found out that farmers are not exporters, that contracts, when you get an export licence, are between the grain company and the Wheat Board instead of the farmer.
Now, this brings into question who is an accredited exporter. I know that is going to be tested in the courts. If we have an elected board of farmers, will they then be able to change or add to the list of accredited exporters because they will have the power to act on behalf of the board?
This is a very dicey subject, as far as I'm concerned, because it is before the courts. Right now it's closed shop as far as accredited exporters are concerned. If it is correct that a farmer cannot get an export licence except through an accredited exporter, there is a big problem somewhere. I think we should find out what the legalities are here if an elected board does change that and gives the right for accredited exporters to different companies or even to a province.
The Chairman: Any clarification on that, Mr. Migie?
Mr. Migie: This particular clause doesn't have any bearing on that. What it's confirming is what the Justice lawyers felt is the case right now, that the act is binding on a province. I don't see how it has any bearing at all on the question of the ability of a future board of directors to make any changes in how they're operating the export licensing. It's really just confirming in the act what others have said is implied by the act.
Mr. Jake E. Hoeppner: I gather that elected directors, or the people running the board, will have the power to direct the board in whichever direction they want to, whether they want to change the marketing procedure of it or not. That's the impression I got.
Mr. Pickard: Mr. Hoeppner, possibly I could suggest that once we have the act in place, and the act talks about the governance, the board and its responsibilities, the act would move ahead. What would happen in a future time, when you're talking about a speculation of another circumstance, is that there's absolutely no question that this board, in looking at the operations, could make recommendations back to the government and ask for alterations to be done within the structure of the act. But they certainly are responsible, as every government agency would be, to follow the act as the act is laid out.
Mr. Jake E. Hoeppner: I'm under the impression that we're changing the nature of the whole thing. It's not going to be a government crown corporation any more but only a partial one.
Mr. Pickard: You're very correct in that case. They can make recommendations back as to what changes should be required within the act. If they deem so to do, they can make those recommendations back and then that could be acted upon by the government.
Mr. Jake E. Hoeppner: So they could then recommend that a province could become an accredited exporter.
Mr. Pickard: That could be a recommendation, certainly.
The Chairman: But the act would have to be changed to allow that -
Mr. Pickard: That's correct.
The Chairman: - which would take another debate in a forum like this.
Mr. Jake E. Hoeppner: You know, this may be changed without us even going to the government, because there's a ruling as far as the barley challenge is concerned whether it's even constitutional.
The Chairman: That's in the courts, and we're not going to discuss today what's in the courts. What's in the courts is in the courts, and will be dealt with there.
Mr. Jake E. Hoeppner: But it could change the whole perspective on this.
The Chairman: A lot of things could change what happens tomorrow, Jake, but if it's in the courts, the courts will deal with it.
Mr. Jake E. Hoeppner: The courts will reform government, right?
Some hon. members: oh, oh.
The Chairman: That's a scary thought.
[Translation]
Mr. Chrétien.
Mr. Jean-Guy Chrétien: Bill C-72 is, of course, binding upon the Crown and all provinces in Canada including, of course, Quebec. However, this did not exist before in the previous Canadian Wheat Board Act. I find it unacceptable that the new version is being used to interfere once again in the affairs of a province, the province of Quebec.
.1640
I would like you to tell me what advantages there are because, in my opinion, this is once again chipping away at Quebec's powers. I find it unacceptable to take advantage of a bill to commit Quebec whereas in reality, only three provinces and part of British Columbia are involved. Can you answer that, Mr. Pickard?
[English]
Mr. Pickard: Mr. Chrétien, maybe I could say first of all that I'm still very cooperative with you and want to cooperate with you on our previous discussion.
The Chairman: Blame it on the chair.
Mr. Pickard: However, the act is stating what presently exists. It's not altering any existing circumstance. To be very clear, it's just stating what does exist presently and confirming that existence.
So we're not infringing upon a province. We're not changing the means by which the Wheat Board operates in that case. We're not altering the relationship between the Wheat Board and the provinces, or the Wheat Board and the federal government. All is the same; it's just confirmed within the act that this is where things are at.
[Translation]
Mr. Jean-Guy Chrétien: Mr. Chairman, I will now speak to our legislative adviser, who is a well-known lawyer. Is the minister correct in saying that we are adopting exactly the same principles that were found in the old Canadian Wheat Board Act when we add that this applies to all provinces?
[English]
Mr. Byer: The amendment that's been drafted here mirrors similar language that exists in the Canada Grain Act, which very clearly states that the act is binding on Her Majesty in right of a province as well as Canada. As I indicated earlier, there is jurisprudence to the effect that this legislation in its present form is currently binding on all of the provinces.
The purpose of the amendment, as has been previously explained, is to clarify the law to make certain that there is no doubt whatsoever. Whenever we are confronted with a question where there needs to be a clarification of law because there is a paragraph or a line missing but the courts have already recognized that the law applies in a certain way in order to be effective, we usually try to address that through subsequent amendments. That is in fact what's happening here.
[Translation]
Mr. Jean-Guy Chrétien: Then why do you not include only the provinces to which Bill C-72 applies? In that way, you would not risk involving all of the provinces. You know full well that this makes sense. Think of Newfoundland, for example.
[English]
The Chairman: It applies to Newfoundland as well.
Mr. Pickard: I would make a comment, and then we'll go to the legal counsel if there's anything else.
Presently all sales out of Canada, export sales, are given licence by the Canadian Wheat Board. We have a wheat board in Ontario; we have Quebec wheat being grown and sold there. They can grow it and sell it locally, but the export is controlled by export licences, which are in effect part of the Canadian Wheat Board responsibility.
The reason that responsibility is there is that when the Canadian Wheat Board makes its sales it must issue proper licensing. It stops the fact that some of the wheat might be taken to Ontario and sold under Ontario out of the country. So it's a matter of making all sales and export consistent with the rules that were meant to be and designed for that purpose.
[Translation]
Mr. Jean-Guy Chrétien: Mr. Pickard, do you really think that this clause is being respected at the present time? Every day we see in the newspapers and on television that there are trucks crossing without any Wheat Board Control.
[English]
Mr. Pickard: There's no question that the Canadian government has looked at those. They have dealt with those issues up front; there's no question about that.
.1645
The Chairman: Mr. Benoit.
Mr. Leon Benoit: First I have a question for Mr. Pickard. Did you or the Minister of Agriculture consult with the agriculture ministers from the provinces or the provincial premiers on this clause?
Mr. Pickard: There was wide consultation on all aspects of the bill, not only with the Department of Agriculture but with the provinces and with the industry people right across the board.
Mr. Leon E. Benoit: How many provinces did you actually consult with? All provinces?
Mr. Pickard: I'll let Howard take over the detail on consultation.
Mr. Migie: There was no consultation on this particular clause in the bill. It was not ready.
An hon. member: Oh.
Mr. Migie: As was pointed out, it came out from the need to make a clarification. Just as a lot of the clauses need to make a clarification, that's what this one in particular was there for.
Mr. Leon E. Benoit: A need to make a clarification... I would like to ask the legal counsel for his professional opinion on whether this change does in fact only clarify. Or could it, in his professional opinion, actually strengthen the control of the federal government and keep, for example, Alberta from doing what the former Minister of Agriculture has indicated they might want to do?
Mr. Byer: As I said at the outset, even without this amendment it's our opinion the Government Alberta would be acting beyond its authority were it to seek to set up an export agency. That is a matter which is being litigated before the courts. Beyond that statement I really can't add anything.
Mr. Leon E. Benoit: But my question was whether this amendment to the act in your opinion only clarifies, or it will in fact strengthen, to some extent, and give the federal government more power than before in this area.
Mr. Byer: The effect of the amendment is to reflect what the jurisprudence has already found. That's about all I can say.
Mr. Leon E. Benoit: You're saying it won't strengthen whatsoever, it will only clarify.
Mr. Byer: It's simply to reflect what the jurisprudence has demonstrated in the past, that the courts have found that the Canadian Wheat Board has an exclusive monopoly. The purpose of this clause is simply to make that crystal clear.
Mr. Leon E. Benoit: Are you relatively certain, with a high degree of probability, that this amendment wouldn't make it more likely for a court in a hearing possibly on Alberta's pulling out of the board's jurisdiction or some such thing, or just Alberta's acting as an intermediary so farmers can market outside the country without going through the board...? In your opinion, you're quite certain, or not really that certain, this wouldn't have an impact.
Mr. Byer: If you're asking me for my opinion on the subject, I would say the outcome of a court case on that matter would probably come out the same way regardless of whether this amendment were there or not.
Mr. Leon E. Benoit: Based on what?
Mr. Byer: Based on the history of the jurisprudence on this act.
Mr. Leon E. Benoit: To get to the possibility this amendment isn't even acceptable under the Constitution... I'm going to give a bit of background on that before I get into it. Mr. Hermanson, in Calgary at the committee meeting on March 20, asked... I'm going to read this. He's asking the Minister of Agriculture for Alberta, Mr. Paszkowski, about this, and he says:
- Clause 2 of this bill indicates more clearly than in the current legislation that this act is binding
upon the provinces. Whenever a province shows interest in federal legislation or is in fact
mentioned in the legislation, I believe it's appropriate for a fair bit of consultation to have taken
place.
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Then Mr. Hermanson continues:
- So I would ask you, as the Minister of Agriculture for Alberta, have you had extensive
consultations with Mr. Goodale...?
- And it goes on. I won't read the whole thing. But what Mr. Paszkowski answered was
- We certainly took every opportunity to present our views...
- As far as clause 2 is concerned, the federal government did not consult with us. We feel it's
important that at the end of the day we have a piece of legislation that is going to work toward
the maximum benefit of the producers of this province.
The Chairman: That's a point of clarification.
Mr. Pickard: That's wrong.
Mr. Leon E. Benoit: No, the board has to issue a permit, but it's done freely. It doesn't in any practical way interfere. I've talked to enough farmers and grain companies from Ontario to know that is the case. I doubt you could point to a case in the past several years where the Wheat Board has said no when someone from the province of Ontario has asked for an export permit for a seller, for example, in the United States.
Mr. Pickard: I can tell you quite clearly that in Ontario all grain for export is marketed through the Wheat Board. That is the case. They belong to the Ontario Wheat Producers' Marketing Board rather than the Canadian Wheat Board.
Mr. Leon E. Benoit: Exactly.
Mr. Pickard: The same process is there, outside the fact that the Canadian Wheat Board issues licences to the Ontario Wheat Producers' Board for export. So we do have a similar grain marketing board in Ontario, only it is within the Ontario structure of the Ontario wheat board.
Mr. Leon E. Benoit: I'm quite familiar with the Ontario wheat board.
So if Alberta wanted to set up an Alberta wheat board parallel to the Ontario wheat board, could the changes in this clause in fact make that more difficult? Then are we into a case where the Constitution might say that really shouldn't be allowed to happen? Ontario already has it. Alberta only wants what Ontario has.
I guess it's really the same question for Quebec, when you think about it. What if Quebec wanted to get involved in the Canadian Wheat Board on the same basis as Saskatchewan is involved, for example?
There are a lot of constitutional questions. I'm just wondering if this doesn't just muddy that water, rather than clarify it, in terms of constitutional questions.
Mr. Byer: If you're asking me whether the Alberta government could set up a wheat board of its own, within its own jurisdiction it can set up anything it wants. But when it comes to exporting grain, could it operate the same way as the Ontario board? Yes, if the Canadian Wheat Board issued licences for the export of Alberta grain.
Mr. Leon E. Benoit: So the Canadian Wheat Board has more power than the Canadian government, the federal government, in this case?
Mr. Byer: I'm simply responding to your first question, which was whether there could be an Alberta wheat board which would operate in the same way as the Ontario board.
Mr. Leon E. Benoit: It seems a little funny that the Canadian Wheat Board could stop something like Alberta's forming its own wheat board, parallel to the Ontario wheat board.
Mr. Byer: It's not the formation of the board they would be intervening on, it's the export of the grain without a licence.
Mr. Leon E. Benoit: Yes; and of course I'm talking about the practical working of a board -
Mr. Byer: But that's a matter of policy.
Mr. Leon E. Benoit: - that has been set up and is operating.
Mr. Byer: That's a matter of policy, though: under what circumstances licences would be issued by the Canadian Wheat Board.
Mr. Leon E. Benoit: But in your opinion this clause...
Maybe I should ask you a little about your involvement in the process of developing this bill. Have you been involved in the process from the beginning, checking out or doing the legal work on this bill?
Mr. Byer: I've been one of lawyers involved, yes.
Mr. Leon E. Benoit: Did you have constitutional experts involved in this process as well?
Mr. Byer: I'm not sure what you mean by ``constitutional experts''.
Mr. Leon E. Benoit: I know it is a fairly loose question. You would have to judge, and I would trust your judgment in that case. I mean someone who has a high degree of expertise on the Canadian Constitution and in particular how it might apply to the less than equal treatment between provinces.
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Mr. Byer: I can say that constitutional issues were considered.
Mr. Leon E. Benoit: In fact, on this change to the act, did you have somebody you would classify as a constitutional expert involved in the process?
Mr. Byer: Yes, we have lawyers who are knowledgeable in constitutional law, and they looked at it.
Mr. Leon E. Benoit: What kinds of questions did they bring up during the process regarding this particular clause? I'm talking about clause 2 here, and the change.
Mr. Byer: There weren't a lot of questions around this clause, because it's not innovative. It's not a new clause. This type of clause has been used in many pieces of legislation, such as the Canada Grain Act, and has been upheld to be valid by the courts.
Mr. Leon E. Benoit: Are you saying exactly the same clause?
Mr. Byer: It is exactly the same clause, word for word.
Mr. Leon E. Benoit: When was that put into the Canada Grain Act?
Mr. Byer: Offhand, I couldn't say.
Mr. Leon E. Benoit: So you're not aware whether it was when a Liberal government was in power.
Mr. Byer: I wouldn't know.
Mr. Leon E. Benoit: Mr. Migie, are you...?
Mr. Migie: It's been there for many years.
Mr. Leon E. Benoit: So again, constitutional experts were consulted. You're quite certain that the change isn't going to restrict the provinces further than what was there before.
Mr. Byer: I believe that's what I said earlier.
Mr. Leon E. Benoit: I just wanted that verified. Thank you.
[Translation]
Mr. Jean-Guy Chrétien: Jerry, when Mr. Benoit asked you if the provinces had been consulted, you stated that all the provinces had been consulted. When he then asked your adviser how many provinces had been consulted in the very specific case of clause 2, he answered ``no province''.
I protest. We have to have the true answers, and witnesses' answers must be consistent. Personally, I take everything you tell me at face value, but it seems to me that we haven't yet started campaigning.
[English]
An hon. member: You go further than I do.
[Translation]
Mr. Jean-Guy Chrétien: I would simply like to know if Quebec was consulted in the very specific case where all provinces in Canada are included.
[English]
Mr. Pickard: As to the answer I gave - and I took it on a broader scale and I apologize - I believe my answer stated that all the provinces and much of the industry were consulted on all the aspects of the bill.
The particular aspect of the question I then asked Howard to clarify, and Howard said on this clause it was not, I misinterpreted. I guess I was broader on the aspect when I said on all parts of the bill and I was not focusing in on the particular clause that was put forth. I would just focus on that. There was no intention to give you a misinterpretation in any respect. My point was that we had broad interpretation on the bill and broad consultation with the provinces.
Again, I would have to go to our officials to get a clarification on what consultation was done with each province.
Howard, do you want to talk about Quebec?
Mr. Migie: Before the bill was drafted, we did not take individual clauses and consult on it. That's not our normal practice. It's only once it became public and tabled in the House that it was made available to all of the provinces, and the officials have appeared in each of the provinces.
We had meetings with industry. We did not have any questions or comments from any of the provincial governments in eastern Canada. So the point is, we did not take this clause and consult with a provincial government, but once it was published and in the public domain it was available, and then we did make ourselves available to appear and to answer any questions.
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Mr. Elwin Hermanson: I have two questions. First, and this is more subjective, given the interest in this bill by at least two provinces - I think three, but certainly the Government of Saskatchewan has said it is prepared to go to court over what happened to the future of the Canadian Wheat Board, and the Government of Alberta has indicated something similar, and there are already legal challenges to the board in the courts - given that controversy, why would the government include clause 2, which binds this bill on the provinces, without first talking to them to see if there might be some other arrangement it can make with the provinces that felt so strongly about this legislation that they were already talking about going to court even against each other?
The second question is a follow-up. Mr. Byer, I think what you said was this. Suppose the Government of Saskatchewan and the Saskatchewan Wheat Pool wanted to set up a Saskatchewan wheat marketing board similar to Ontario's. Are you saying they could do that without the approval of the Minister of Agriculture, Governor in Council, and the board of directors of the Canadian Wheat Board - they could actually set up another agency, the equivalent of what is in Ontario, which would then have to export with an export permit from the Canadian Wheat Board? I certainly didn't see that in this bill, and I think that's what you just said. I wonder how you can clarify that for me.
Mr. Byer: What I said was that within its own area of authority nothing prevents the provincial government from setting up a crown agency. However, if that agency is going to engage in the export of grain, it would require a licence from the Canadian Wheat Board to do so.
Mr. Elwin Hermanson: That is extremely interesting.
The first question wasn't answered. The first question had to do with consultation with the provincial governments on such a divisive and controversial issue. Clause 2 might have been different had there been some consultation with the provinces.
Mr. Migie: About the meetings we did have, where at least the prairie provinces came and met, no arguments were presented that would suggest any changes to that clause. It's taking the same statement as is in the Canada Grain Act and making clear what the federal justice lawyers have said would be the case anywy; but let's make it clear, and that's what the clause does. Nothing was presented that would suggest changing language or anything of that type. It was presented and we didn't get those kinds of comments, in the case of Alberta, objecting to the clause itself.
Mr. Elwin Hermanson: So Alberta objected to clause 2 after the bill was made public. There was no consultation about this before. I'm wondering why, in light of the fact that Alberta was musing about setting up its own export agency and wondering whether or not it could do that within the framework of the existing act, you wouldn't sit down and talk with these people before you drafted clause 2.
The Chairman: A point of clarification, Mr. Hermanson. The regulations of the Canadian Wheat Board, etc., right now cover - it's in there at present - that no one can export wheat or barley from Canada unless they go through the Canadian Wheat Board. This just clarifies it. It states the same thing here. It's already there, whether it's the Ontario wheat board or the Saskatchewan wheat board or the Newfoundland wheat board. If they go to export wheat or barley, they have to get the export permit from the Canadian Wheat Board.
Mr. Elwin Hermanson: I accept what you say, but the Government of Alberta was trying to find some other mechanism for having this situation. That being known, when this bill was drafted, why wasn't there consultation with the province to see if perhaps this clause shouldn't even be there or it should be worded differently? That's what I'm asking about.
Mr. Wayne Easter: We had consultation with producers. That's what we were doing in Alberta.
The Chairman: I'll move to Mr. Benoit for a couple of questions to end the discussion on clause 2 and then we will deal with clause 2. Mr. Benoit.
Mr. Leon Benoit: Thank you, Mr. Chairman.
Just a bit of follow-up on the Ontario wheat board and if Alberta were to set up a similar wheat board. I had a question answered earlier. I'm not sure it was quite accurate. Isn't it true that in Ontario milling wheat can be sold domestically, within Ontario, without going through the board in any way? In the other provinces, of course, we don't have that freedom for milling wheat. All of it has to go through the board, even within our own province, even if there's a company in our home town.
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Mr. Wayne Easter: It's not freedom. It's marketing. Let me just point that out to you.
Mr. Pickard: In fact the Ontario Wheat Producers' Board -
The Chairman: Can someone answer that?
Mr. Pickard: The Ontario Wheat Producers' Marketing Board deals with the wheat coming through Ontario in the same way that the Canadian Wheat Board deals with the wheat going through the prairies. The Ontario board has jurisdiction in Ontario. When export sales are required, they must get permits from the Canadian Wheat Board.
Mr. Leon E. Benoit: Yes, but my question was specifically about domestic sales. Is it necessary for Ontario farmers who want to sell to a flour mill in their home town to go through the board to do that?
A voice: Absolutely.
The Chairman: We will -
Mr. Leon E. Benoit: Through the provincial board, I'm talking about here, through the Ontario -
The Chairman: I'm not so sure we can answer that, but we'll get it clarified if we can.
Mr. Leon E. Benoit: But certainly if that is the case, then Alberta's setting up of a wheat board would make sense. At least we would be able to sell our wheat to the miller in our home town without having to go through the board. That would be a starting point. It's unbelievable that we don't have that freedom now.
Along the same lines, if Alberta sets up a board that is similar to the Ontario board, and let's say that the Canadian Wheat Board... Because it was indicated earlier that the Canadian Wheat Board may decide to issue permits or they may decide not to, whereas the Ontario board issues permits freely. Let's say that for this Alberta board the Canadian Wheat Board throws these permits in the way and restricts exports when they wouldn't do so in Ontario. This is for you, Mr. Pickard. If your government was in power at the time, would it intervene and stop the Wheat Board from throwing these permits in the way? It's unfair treatment of Alberta compared to Ontario if it does happen.
The Chairman: Mr. Migie.
Mr. Wayne Easter: On a point of clarification, Mr. Chair, are we talking about Bill C-72 here -
Mr. Leon E. Benoit: Clause 2.
Mr. Wayne Easter: - or are we talking about some hypothetical Alberta wheat board that Leon wants to promote, which will in essence undermine the Canadian Wheat Board? Because that is his objective.
What do we have on the table here?
The Chairman: You took the words out of my mouth, Mr. Easter. We're talking about a hypothetical situation. If Mr. Pickard wants to address a hypothetical situation, he's at liberty to do so, but he isn't obligated to do so.
Mr. Pickard: Mr. Chairman, I think we've drifted from where we were moving.
The Chairman: I've allowed a bit of liberty here, but it is a concern. Also, before Mr. Benoit spoke, I said we were moving on when he finished, and he's finished.
Mr. Leon E. Benoit: No, I'm not finished, Mr. Chairman.
The Chairman: Yes, you are. We're going to move on.
Mr. Leon E. Benoit: No, Mr. Chairman. I have some more questions.
The Chairman: I'll give you one more question, Leon, and it had better pertain to the bill and not to a hypothetical situation.
Mr. Leon E. Benoit: All I'm doing is I'm really -
The Chairman: We know what you're doing: you're talking about a hypothetical situation.
Mr. Leon E. Benoit: No.
The Chairman: So if you can bring your discussion back to the bill, we will hear it. If it's not pertaining to the legislation before us, we're going to deal with clause 2.
Mr. Leon E. Benoit: I think I was asking a question regarding clause 2. It's my concern that this clause wasn't properly thought out before it was put in this legislation and that this clause has implications that haven't been considered. And I think the lack of an answer on these issues indicates that in fact is the case.
The Chairman: You have shared your views very clearly.
Mr. Pickard.
Mr. Pickard: Mr. Chairman, I believe that what we have said with regard to this is very clearly a practice that's happening now. It's in the Canada Grain Act. It is not a change, but a confirmation of the present-day practice.
The Chairman: Shall clause 2 carry?
Mr. Leon E. Benoit: No.
A voice: Yes.
The Chairman: Do you wish to vote?
Could the clerk conduct a recorded vote, please?
Clause 2 agreed to: yeas 6; nays 3
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On clause 3
The Chairman: We shall move on to clause 3 on page 2. It starts out in bold print: ``Section 3 of the Act and the heading ``Constitution of the Board'' before it are replaced by the following''. It then goes on.
There is an amendment before us on clause 3. Mr. McKinnon.
Mr. Glen McKinnon (Brandon - Souris, Lib.): Yes, I'd like to propose that an amendment be put in place to replace the present language on lines 5 and 6 of page 3. It would read:
(2) The board shall consist of 15 directors, including a
This puts into the bill a specificity that was apparently lacking, at least according to the views of a lot of the presenters we heard out west.
The Chairman: Are there any further comments on that amendment? Mr. Chrétien.
[Translation]
Mr. Jean-Guy Chrétien:
(2) The Board will consist of 15 members...
Do we remove the word ``eleven'', Mr. McKinnon?
[English]
Mr. Glen McKinnon: There would be fifteen directors. I'm sorry, I wasn't listening carefully, Mr. Chrétien.
[Translation]
Mr. Jean-Guy Chrétien: Must the Board consist of 15 members of 11 members?
[English]
Mr. Glen McKinnon: Fifteen.
[Translation]
Mr. Jean-Guy Chrétien: That's not what is written here.
[English]
The Chairman: Yes, it is. It's in the very first amendment. This amendment replaces lines 5 and 6 on page 3, and those two lines will read:
(2) The board shall consist of 15 directors, including a
and it will the go on to line 7 and read ``chairperson and a president''. So if I understand it correctly, and if this amendment is passed, the total clause will read:
(2) The board shall consist of 15 directors, including a chairperson and a president.
Mr. Glen McKinnon: My apologies for excluding that last part, Mr. Chairman.
The Chairman: That's fine.
Any further discussion? Mr. Chrétien.
[Translation]
Mr. Jean-Guy Chrétien: This is an amendment introduced by the governing party. Mr. Jerry Pickard, can you tell me why we've gone from 11 to 15, and why you insist on 15 and not 11, 12, 13, 14 or 15?
[English]
Mr. Pickard: To my knowledge, we never did set a figure in stone. We were talking about a potential number of people, anywhere from say ten to eighteen, or whatever. In looking at the structure of the board and in listening to all of the testimony and information that was put forward, it was decided that with the number set at fifteen you could have a good elected representation from the west, while dealing with the fundamental expertise. There are questions, though. If you get too large, it's a very unwieldy body. If you're too small, you may not be able to represent numbers well.
I believe fifteen was the number chosen after all of the testimony was listened to, after all of the members had discussions, and after your witnesses came forward. That was what they felt to be the optimum number.
[Translation]
Mr. Jean-Guy Chrétien: Knowing how strongly Jerry feels about the democratic process, and since you voted in favour of clause 2 which involves all of the provinces, and since Quebec represents one quarter of the Canadian population, could we expect that, in a democratic fashion, four board members would come from Quebec? Jerry, be careful how you answer, because this is being recorded.
[English]
The Chairman: I want to hear his answer.
Some hon. members: Oh, oh!
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Mr. Pickard: I have absolutely no problem answering that question. If all the expertise required the best people who could do those jobs, who could make certain that our sales our done, that our corporate interests are served, that our legal interests are served, if everything happened and we had the four top people in the country out of Quebec, I guess it would be a remote - because that would leave everybody else out - possibility. But the reality is we do need some representation in different aspects, and I think that representation would mainly be elected from the western provinces we've talked about and appointed from across the country, to make sure the expertise is there. I'm not going to speculate any further on whether that would be out of Quebec or not.
[Translation]
Mr. Jean-Guy Chrétien: We know full well, Jerry, that the prime minister chose his ministers from each province when he formed his Cabinet, so as to appear credible before the electorate, which is perfectly understandable. It would therefore be wise to find some men or women from Newfoundland since you have bound all of the provinces. With this in mind, do you intend to consult the Minister of Agriculture in each province this time in order to obtain suggestions for future appointments to positions on the Canadian Wheat Board?
[English]
Mr. Pickard: I will guarantee you there will be thorough consultation in the process before it is finalized. But remember, we're talking only about the up-front group. Eventually it's going to be taking over elected members from the Canadian Wheat Board area. There is a process where some will be appointed, some will be some elected. The more quickly we can get to the democratic stage, where we have the total elected group and the appointed people, the better off we will be.
[Translation]
Mr. Jean-Guy Chrétien: When will there only be elected members?
[English]
Mr. Pickard: December 1998.
The Chairman: Mr. Hermanson, that's a fifteen-minute bell. It started at 5:17. So we'll take five more minutes and then we're out of here and we'll see you tomorrow at 10:30 a.m.
Mr. Elwin Hermanson: We'll probably take up Mr. Chrétien on his offer if we can get Saskatchewan farmers running the ports in Montreal and maybe out in Vancouver.
Some hon. members: Oh, oh!
The Chairman: With all due respect, what do Saskatchewan farmers know about running ports?
Mr. Elwin Hermanson: You might be surprised. They might make it run a lot better than it is right now. There won't be any ships sitting out there in English Bay.
Back to clause 3, I'm not surprised you picked fifteen - you had to pick a number - but I'm surprised you left the president as a member of the board. He or she is one of the fifteen members. When we were touring the prairies two or three weeks ago... And this may not be a complete list, Mr. Chairman, because I didn't have all the briefs in front of me when I was calculating this. In their briefs, on whether the CEO should be on the board of directors of the newly structured Canadian Wheat Board, UGG said no, Manitoba Pool Elevators said no, Keystone Agricultural Producers said no, and Saskatchewan Wheat Pool said no. Mr. Fulton, from the University of Saskatchewan, said no. The NFU said no. The Alberta Grain Commission said no. Wild Rose Agriculture Producers said no. The Western Barley Growers Association said no. You can't get a much broader group of farm organizations, very responsible farm organizations, and they specifically said the president or CEO of the Canadian Wheat Board should not be a sitting member or a voting member on the board.
This amendment you have just presented states that the board shall consist of fifteen directors, including a chairperson and a president. I would like to know the rationale for going against the consensus right across the prairies.
.1720
Mr. Victor Jarjour (Director, Grains and Oilseeds Division, International Markets Bureau, Market and Industry Services Branch, Agriculture and Agri-Food Canada):Mr. Chairman, during the hearings there were a number of people who did express that view.
It was noted, particularly with respect to the western cooperatives that are involved in the grain industry, the three pools and UGG, that their board of directors is entirely elected. Therefore, in some respects, it's virtually by definition that an appointed chief executive officer could not be a member of the board of directors. Secondly, the chair of their board of directors is also a full-time position.
Both of those things are different with respect to the Canadian Wheat Board. The chair of the board would be a part-time position and the CEO would be an appointed position.
Mr. Elwin Hermanson: Further to that, Mr. Chairman, this CEO is in a conflict of interest position, being on the board and being the sole person responsible for the operations of the board. You just don't set up things like that.
When Deloitte & Touche did their management study of the existing system of five commissioners, they said part of the problem with the Canadian Wheat Board, or a big problem, was that it had a 1940s management structure. Going into the 1990s, it needed a more corporate management structure. This is not a corporate management structure; this is an unworkable situation.
Mr. Jarjour: Mr. Chairman, if I may, we looked closely at various examples of corporate governance in -
The Chairman: We have only five minutes, so be very quick.
Mr. Jarjour: Let me be very brief.
In virtually 80% or 90% - I think the number is 80% - of the cases in the private sector where the president is the CEO, the president sits on the board of directors and is a full member of the board of directors.
The Chairman: We're going to have to adjourn. We meet tomorrow at 10:30 a.m. I'm going to ask the clerk to send out an extension of the meeting tomorrow from 10:30 a.m. until 1:30 p.m.
Mr. Pickard: Can you make that earlier?
The Chairman: We can't, because of other meetings.
Mr. Pickard: Oh, okay.
[Translation]
Mr. Jean-Guy Chrétien: Mr. Chairman, why not start at 9:00 tomorrow morning?
[English]
The Chairman: The government members have other business. We notified everybody yesterday it would be 10:30 a.m.
The staff tell me that before we adjourn we have to stand the amendment and the clause so that we start in tomorrow where we left off today.
Some hon. members: Agreed.
The Chairman: The meeting is adjourned.