FINA Committee Meeting

STANDING COMMITTEE ON FINANCE

COMITÉ PERMANENT DES FINANCES

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, April 21, 1998

• 0915

[English]

The Chairman (Mr. Maurizio Bevilacqua (Vaughan—King—Aurora, Lib.)): I'd like to call this meeting to order, and welcome Mr. Tom Brzustowski, president of NSERC.

Sir, you have approximately 10 to 15 minutes to make your presentation, and thereafter we will engage in a question and answer session.

Mr. Tom Brzustowski (Canadian Millennium Scholarship Advisory Group): Good morning, Mr. Chairman, and ladies and gentlemen. First of all, please accept my apologies. It seems that when one is in the building, it's easier to be late than when one is coming in from far away. I do apologize.

I have a very short statement. I think it's extraordinarily appropriate that at the turn of the century, when we're moving very clearly into what Canadians now increasingly understand is an economy in which our knowledge and our competence will be the key to our success, the millennium project that is attracting the most attention—

The largest financial commitment should be one really devoted to learning, to enabling Canadians to have greater access to post-secondary education, which is becoming almost the most important level for starting a career.

What really impresses me—and I think time will show this is extraordinarily important—is that in the bill as proposed in the budget paper, the definition of learning, and the access, is not just for full-time students in post-secondary institutions, such as universities and colleges. In fact it transcends that. It allows learning to be supported, and made easier, for students of any age studying full-time or part-time in any pattern of distribution of their studies over their lifetime. In the long term, Mr. Chairman, that particular element of flexibility may prove to be extraordinarily important.

As you know, I'm here because I was invited. In fact I was honoured to participate in some general discussions of the concept before the budget was presented. I'm really very happy to be with the committee this morning to offer some opinions and to try to answer some questions on the concept, as I understand it.

I'll stop my statement there, if I may.

The Chairman: Thank you very much.

Mr. Ritz, do you have a question?

Mr. Gerry Ritz (Battlefords—Lloydminster, Ref.): Yes, I have a couple of quick points.

Thank you for your presentation, sir. You mention that education is very fundamental as we go into the next millennium. I certainly agree with that. I'm wondering why the wording in the millennium scholarship fund is limiting studies to publicly funded institutions?

Mr. Tom Brzustowski: That's a very good question. There is a clause in the bill that essentially says that it's going to be up to the board, when formed, to deem what institutions are eligible.

I think the decision was made on the grounds that one of the most important things this was meant to achieve was to reduce student debt. I don't know the extent to which there's a logical connection. The concern was that one should simply not create any circumstances in which the money would simply pass through the student's hands where costs might be increased in some way.

Now, I realize that when I say that, I'm not answering your question, because I could foresee circumstances where that might occur in publicly funded institutions, as well. But for better or for worse, that particular decision was made.

It could be partly that one understands the publicly funded system better. In future the board may in fact expand the definition of eligibility to include some of the private vocational schools. But I guess one has to begin somewhere, and the decision was to begin this way.

Mr. Gerry Ritz: Well, we see results of testing done in publicly funded schools, privately funded schools, and so on. Generally the privately funded institutions tend to have a higher degree of learning. The knowledge seems to be higher in the testing that we see.

So I'm wondering, if this is to be the best for the students and so on, why would they limit it? There's no access to information on the results of who they chose, why they chose, and so on. I think we need more accountability, more openness, in that process.

• 0920

Mr. Tom Brzustowski: I must say that I'm not familiar with those results. We're dealing here with universities, colleges, CEGEPs and technical institutes. I'm not aware—obviously you are—of wholesale testing that would show those differences. I'm simply not aware of that information.

Mr. Gerry Ritz: Thank you.

The Chairman: Thank you, Mr. Ritz.

Mr. Crête.

[Translation]

Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ): Mr. Brzustowski, before I begin asking questions, I would like you to explain the mandate of the advisory group of which you were a member and tell us who were the members of this group to which you referred. Then I will be able to delve into the technical issues.

Mr. Tom Brzustowski: Are you asking me a question about the Foundation's board of directors?

Mr. Paul Crête: We don't have a translation here. I am referring to the Canadian Millennium Scholarship Fund Advisory Group.

Mr. Tom Brzustowski: Oh, the Advisory Group. This was a group composed of university or college presidents, academics, a few individuals such as myself, former professors and former officials from the training sector. There were twelve people in the group. There were three four or five-hour meetings to discuss the principle of this project.

Mr. Paul Crête: Who gave you your mandate to work on this issue?

Mr. Tom Brzustowski: The Minister of Finance invited these people to meet.

Mr. Paul Crête: When this committee began discussing the issue initially, did you talk about the appropriateness of the federal government intervening in a sector under provincial jurisdiction, namely, education? Did you ask yourself any questions about this at the outset?

Mr. Tom Brzustowski: We were very aware of this aspect of the issue. This is why the bill states that the Foundation intends to work with the provinces to establish the terms and conditions of the program.

Mr. Paul Crête: Were you surprised to learn that a coalition was established in Quebec, bringing together people from all education sectors, including the university rectors and teachers, public officials, etc., a coalition chaired by Mr. Shapiro, the rector of McGill University? These people came to Ottawa to ask the federal government to hold negotiations in an effort to determine whether it was possible to respect provincial jurisdiction in this matter, and Mr. Chrétien agreed to this. In your opinion, should negotiations take place before any steps are taken to implement a program such as the one for the millennium scholarships?

Mr. Tom Brzustowski: You are the experts in the political sector, I am a former professor and I know my area. However, scholarships that will reduce student debt are so important that I am convinced that people of good faith will find some way to make this program work. I'm convinced of that.

Mr. Paul Crête: At the outset, you said that this legislation contains the definition of learning. Consequently, when we define learning or when we determine what will be covered by learning, we are obviously dealing directly with the field of education.

You are expecting that the negotiations—and this is what everyone is hoping for—will yield results. To date, there have been a few meetings between the two negotiators, Mr. Mel Cappe and the Quebec representative. It would appear that the negotiations are not very easy.

• 0925

In your opinion, what would be an attractive solution for Quebec, so that the money can be distributed in compliance with practices that have existed in Quebec for 35 years, where the financial assistance system, which includes loans and grants, resulted in student debt being considerably lower than in the rest of Canada? What direction should we be taking to get some possible solutions?

Mr. Tom Brzustowski: I can't answer that question. This does not fall within my area of expertise. I don't know what's happening with these negotiations. You should let the people who are aware of the situation answer the question. However, I do acknowledge the importance of the question.

The Chairman: Ms. Gagnon.

Ms. Christiane Gagnon:(Québec, BQ): The objective you are seeking through the Millennium Scholarship Foundation, which will be given 2.5 billion dollars, is quite laudable. However, the provincial transfers, of which a good part goes to education, have been cut back considerably. Don't you think that if the provinces don't have enough money to pass on to the universities and colleges, so that they in turn can put a freeze on tuition fees, all students will be penalized, whereas the Millennium Scholarships be benefit only some students?

Mr. Tom Brzustowski: This is another issue that is often raised in the House of Commons. I must clarify that I was part of this advisory group for three four or five-hour meetings, and that was all. My work stopped with that. I have no responsibilities with respect to the implementation of this program and I'm not informed about the political decisions. I hope to be able to answer questions dealing with the terms and conditions of the program and to present opinions on the value of the programs, but I have no authority whatsoever in the political field. I'm sorry.

Ms. Christiane Gagnon: And yet, you advise a minister who will be earmarking $2.5 billion to Millennium Scholarships. All of these analyses were not taken into account in the opinions that you provided to the minister.

Based on your advice, it has now been decided to set up this Foundation which, in our opinion, jeopardizes the education system and the way that we finance the system in Quebec. On the one hand, students are calling for a freeze on tuition and, on the other hand, the federal government will be investing in Millennium Scholarships that will be awarded on the basis of merit.

And what does "merit" mean? Does this mean that certain fields of study, at the university, will be given greater priority than others? For example, in awarding these Millenniums Scholarships, we have been told that preference will be given to computer science and engineering over the humanities. Did you give any thought to achieving some equity amongst the various disciplines taught at universities and colleges?

Mr. Tom Brzustowski: If I may, I will answer your question in English.

[English]

In this area it's very clear that the priority in this scholarship program was the need. Therefore, the issue of merit is one that was left pretty much undefined, except as you will see in the act. There is one place where merit can be used as the primary criterion, for 5% of the funds.

Generally I think the notion was that need was driving this, and that merit would be indicated by progress in the program in which the candidates were enrolled. That means that the institutions themselves would determine the merit, first, by accepting the applicants, and second, by allowing them to proceed, by promoting them in the programs in which they're registered.

• 0930

Only one part of this proposal is in fact dealing with merit as defined in strictly academic terms, exclusive of need. Again it is left up to the board of the foundation to decide whether to give priority to one field over another. That has not been designed.

That question and many others were consciously left to the board, on the understanding that quite an extensive consultation would be held across the country before those matters were decided. A group sitting for three meetings of a few hours each, talking about the concept and principle, could not answer those questions.

[Translation]

Ms. Christiane Gagnon: However, you did take it upon yourself to advise the minister with respect to the implementation of the Millennium Scholarship Program in an effort to fight student poverty and to improve their benefits during their course of study. The fact that a three or four-hour meeting of a few individuals can lead to a project of such magnitude makes me somewhat skeptical about just how feasible and logical this Foundation is. We have tried to find out what the administrative costs of such a project will be and we can't get an answer.

In addition, we have tried to find out how this program will be administered in each of the provinces. However, the provinces are given very little flexibility. If, for example a province such as Quebec wanted to be compensated because it already had its own scholarships—

Given the difficult economic situation, it is quite difficult to believe in the appropriateness of implementing such a Foundation. Furthermore, we don't know how we arrived at this formula for, not a program to be imposed on the provinces, but a Foundation set up to help students. We are not against the idea of helping students, but this was not the desire that had been expressed during the premiers' meeting. The premiers had expressed a wish that a portion of the Canadian Social Transfer that had been cut back be reinstated and handed back to the provinces. Instead, the government is proposing a Foundation like this.

You will therefore understand why we have doubts about how serious this thing is and why are we skeptical when it comes to the interpretation we're given about what's going on in each of the Canadian provinces.

[English]

Mr. Tom Brzustowski: In a sense I find the question very flattering, because while my grandchildren might wish me to take credit for having thought of this foundation, I was only invited to offer some advice on some of the parameters.

But many of the issues that have been raised, for example— Mr. Chairman, I'd like to seize on one or two of the points, and offer some opinions.

On the operating costs of the foundation, there are examples from the provinces that operate financial aid programs for students in universities, and these are of the typical workload. I think the experience in Ontario would be that one employee can handle about 1,000 applications per year on average. These are of a very comprehensive nature, giving the financial background of the students, the families, and so on. I would hope that the foundation would not create new work that would have to be done either by the students or by people making the judgment. The costs could be kept very low, because information already being gathered would be used yet again.

So I would hope that the foundation could work for substantially less than 5% of its annual disbursement budget.

[Translation]

Ms. Christiane Gagnon: One final question. This morning we learn that you have been given a specific mandate from the minister and that you advised him. Would it be possible to see the wording of this mandate as well as the opinion that you provided to the minister, the opinion which the minister based himself on in order to create the Millennium Scholarship Fund Foundation? Did you receive a mandate? If you did in fact receive a mandate from the minister, it must be in writing.

[English]

Mr. Tom Brzustowski: Well, there's a limit to how much I can talk about a process on which I signed an oath of budget secrecy. But I think I can fairly say that all the members of that group were called in.

• 0935

In fact the budget plan precisely describes what this group did. Page 86 of the French version states that:

[Translation]

An advisory group—

This is an error in translation.

An advisory group, comprising representatives from the university sector and student groups, was consulted as part of the process to define the basic mandate.

A group was consulted as part of the process to define the basic mandate, however the idea to have a foundation had already been decided upon. This small group gave its opinion, but that's all.

Ms. Christiane Gagnon: Consequently, there is no list detailing the opinions that allegedly were given to the minister, that we could consult.

Mr. Tom Brzustowski: The budget outlines the principles, the general guidelines.

The Chairman: Thank you, Ms. Gagnon.

[English]

Mr. Brison.

Mr. Scott Brison (Kings—Hants, PC): Thank you.

We have some concerns relative to the Auditor General's role—or, rather, non-role—in overseeing the $2.5 billion worth of taxpayers' money, which is ultimately the seed money for the foundation.

We recognize that with respect to an arm's length foundation, there are reasons why the Auditor General would not be involved. The concern we have is related to the $2.5 billion worth of taxpayers' money, where the taxpayer will not have an ability to directly oversee the expenditures of those funds.

Under this legislation, the auditor will be appointed by the board. Again, this is highly irregular. How would you feel about the idea of the auditor being appointed by the minister or by parliamentarians, for instance, as a recognition of the Canadian taxpayers' interest in this foundation?

Mr. Tom Brzustowski: Well, again, I'm going to offer some opinions that may not be very well informed.

My experience with boards on which I have served—university boards, non-profit volunteer agencies, and so on—is that they always appointed their own auditors. If the process is made sufficiently transparent and the reporting is open enough, that generally has satisfied people. In this case I simply couldn't offer an opinion, but I can understand where you're coming from on the suggestion that Parliament might wish to be involved in the appointment of the auditor. I can't comment on that.

This is a unique structure. This is number two. The Canada Foundation for Innovation is the very first. It remains to be seen how its practices will be received. They are being set up to be very transparent, to follow all the rules precisely.

It's clear from my reading of Bill C-36 that the same intentions are being carried into this legislation. But I can quite understand the question, and I'm sure it will be debated at length if it's raised seriously.

Mr. Scott Brison: Sure, and you see that the concern also is that the books of the foundation are not even available through access to information. Again, as an arm's,length foundation—

But again, there is a significant investment of taxpayers' money, the same as for the Foundation for Innovation; there's a parallel there. It is a new trend, and it's one with which many Canadians feel uncomfortable at this stage, so that is the primary concern we have.

I would like to express another concern briefly. You were saying that need is considered more important than merit. But the wording of need and merit is extremely nebulous in the legislation. Depending on the make-up of the board, the emphasis on either need or merit could shift, and again the mandate isn't clearly spelled out.

• 0940

Second, in terms of need, this foundation will only benefit 7% of students seeking higher education in Canada. This is at a time when we have an average student debt of around $25,000 upon graduation after a four-year program. Would you address those concerns? I mean, it is very nebulous right now.

Mr. Tom Brzustowski: Let me address those concerns, but perhaps just add something at the front end that may be part of the answer. In terms of public accountability, we mustn't overlook the fact that the bulk of the spending, in terms of awards to individuals who are named, will be made known. That will be public information.

In terms of the outcome of public funding, that's perhaps as strong a statement of how the money is being used as any that we can come across. I mean, all the recipients will be named, and the amounts they receive will be listed.

The balance between need and merit is a very difficult one. As I understand it, this program was designed particularly to address the issue of student indebtedness. It was to be an accessibility-driven program, with need being predominant. Given the very public nature of the consultation process that will obviously take place across the country, I can't imagine that any board members would in fact depart from that.

Again, I borrow from the example of the Canada Foundation for Innovation. All of the detailed design of this program is based on an extensive and, I think, at least double—maybe even triple—consultation across the country, from coast to coast, with the groups involved. Here the group would be much larger, but there are organizations that speak for them.

I really feel that the members of the board would be quite constrained by the general direction and the general objects of the foundation to continue putting the emphasis on need.

The issue of quality and how it might be measured could be a little more variable, and here I would offer a hope. I would offer the hope that in this case the board selects the simplest, most direct indicator of merit that is readily available without doing additional work. I think this is, first, simply the admission to programs for which there is competition, and second, successful promotion by these people through the program.

To me the words in subclause 5(1) of the bill are not so ambiguous. The objects and the purposes are: “to grant scholarships to students who are in financial need and who demonstrate merit”. To me that sequence is quite clear: those who are in financial need and, in addition, demonstrate merit.

So I would hope that this language would be interpreted unambiguously and consistently by the board through future years.

Mr. Scott Brison: Thank you.

The Chairman: Thank you, Mr. Brison. Mr. Riis.

Mr. Nelson Riis (Kamloops, NDP): Thank you very much, Mr. Chairman.

You're obviously very excited about this project, and one can understand why. A lot of students will be assisted.

Your comments this morning, in terms of defining the relation between need and merit, are very comforting, because there has been a whole deal of questions around this. I think you have set a lot of our concerns at rest. So I'm very appreciative of your comments in that area.

My friend mentioned the auditor. I remember that a few years ago we had banks collapsing around us. All the auditors' reports were written in glorious terms about how wonderfully successful these banks were. Then six months later they didn't exist.

So we've become a bid jaded with auditors' reports, particularly from those auditors hired by the firms for auditing. So as you've indicated, that's a concern,

One of the concerns that has been expressed to me is that while this will assist 7% of students attending universities and colleges, an increasing number of people are attending other kinds of institutions. Around this table sometimes we've discussed the issue of people seeking a more practical training experience, a more direct route into the workplace. Can you tell us to what extent this foundation will be able to assist those people?

• 0945

Mr. Tom Brzustowski: All right. I must admit right off the bat that I'm somewhat surprised by the figure of 7%. My thought had been that this foundation might provide perhaps 100,000 scholarships a year to a group that is of the order of one million people.

I guess maybe the question of accounting is an interesting one, because it gets at the question you asked. There are about 500,000 university students, a somewhat smaller number of college and CEGEP students, but then we go beyond that.

One of the things we have to realize—and I think few people realize it—is that the education system, as we have it in Canada today, is made up of two components. Most of us initially think only of one.

One component is the educational institutions. The other component is what you might almost call the educational market. That involves people being taught at the community level, people getting on-the-job training, people being sent off for management courses, and people being sent off to do retraining. This is quite apart from the first pass through the educational institutions.

In my initial comments I pointed out that I thought the strength of this would be that it allows people of any age, at any time in their life, to seek such support. And it's really up to the board to determine just which people are eligible.

Paragraph 27(1)(b) refers to an eligible institution with full-time student or part-time student status combined. It's the part-time status that's so very important.

Paragraph 27(1)(c) refers to the pursuit of studies that lead to a degree, certificate or diploma. Once you include a certificate or diploma, you really broaden the range. It includes a great many activities in that education market that are accessible to people at any point in their lives.

So I welcome the breadth in there. I think it's—

Mr. Nelson Riis: Do apprenticeships come under that, people becoming journeymen and that sort of thing?

Mr. Tom Brzustowski: My sense is that this deals with post-secondary— it might rule out apprenticeships. But, you know, I don't see it in here in a cast-iron way. It may be that the board would wish to make interpretations on that.

I have not thought of apprentices falling within the definition of full-time or part-time students. But I would like to think that if the need is demonstrated, there is enough room here in terms of what the board would have to work with so that apprentices could be included if there was general agreement that they should be.

Mr. Nelson Riis: Thank you.

Mr. Chairman, I have one last question.

Perhaps if you don't mind, you could seek some clarification on that point. There are organizations and a lot of individuals who have been asking that question particularly. Perhaps there are other areas surrounding the general description of apprenticeships, and it might be clarified. I urge you to consider that at the earliest opportunity.

My last question relates to subclause 5(2), which reads:

The Foundation shall grant scholarships in a fair and equitable manner across Canada.

Permit me to be a western voice around the table. Those of us in the west— I say this with all sincerity, although my colleagues may question it. I have yet to find a single federal-provincial program where the province of British Columbia, for example, gets their fair share, at least based on population. There may be one someplace, but I have yet to find one after being here for 18 years.

So I suspect that you'll understand why I see this with some skepticism. However, could you comfort me in some way, and comfort others of those who come from the regions of Canada, that in fact we'll understand what equitable means in this case?

Mr. Tom Brzustowski: Well, as I recall the discussions on this particular wording, it was seeking precisely what you're asking for. Here I depart into opinions, because the design of how the program would be delivered is really being left up to the board and its management team. But I imagine that a pretty obvious starting point would at least be to allocate scholarships to the provinces, for example, in proportion to the student enrolments or in proportion to population.

• 0950

As one reads through this, it is obvious that somebody will have to produce a list of students deemed to be in financial need, and deemed to be meritorious by whatever criteria the board chooses. These will come as indicated here. They may come through the provincial governments, or they may come from the Council of Ministers of Education of Canada. They may come in some aggregated way like that.

It is hard for me to imagine that this could happen without some a priori distribution of the numbers that might be expected. The obvious place to begin is with proportionality to the population of the provinces, proportionality to the student enrolments total, or whatever.

Mr. Nelson Riis: May I make a suggestion that you consider at least the population base. I say this for a number of reasons. The participation rate in post-secondary education in the province of British Columbia is one of the lowest in Canada. The reason for that is that there are pockets of extreme poverty where people feel access is simply not there. To be fair, there may be other reasons as well.

So if you are basing it on participating population, then I will be saying that once again we are getting skewered out there on the far west coast. If it is based on population, of course it is a different matter.

Mr. Tom Brzustowski: Mr. Chairman, even though that comment was directed to me in the second person, could I say that I think the record of this committee's discussions would advise the board, whoever that is, on how to proceed.

My involvement with this project is at an end, and I don't expect to have any more. I think that being an employee of the Government of Canada, I am enjoined from being a member of the board by what is in here. But I think it's an important point to make to whoever is on the board, that the record of this committee's discussions should guide them.

Let me just come back to apprenticeship. It's a question of definition, of whether post-secondary education does or does not include apprenticeship, because those words are explicit. I think that issue is worthy of discussion. That is in subclause 5(1).

The Chairman: Thank you, Mr. Riis. Ms. Torsney, followed by Ms. Redman.

Ms. Paddy Torsney (Burlington, Lib.): Thank you. Certainly one advantage of your experience is that you have worked at the provincial and federal levels at this point.

Maybe you could enhance the committee's knowledge of the fact that the federal government has been involved in post-secondary education for years. In fact it has had tools like the Canada student loans program, the granting councils, the Canadian health and social transfer, the CHST, and it has been involved in the delivery and accessibility of education for a number of years. Is that not correct?

Mr. Tom Brzustowski: That is absolutely right. I mean, when I was deputy minister of colleges and universities in Ontario it was very clear that we were very conscious of the then established programs financing. We were very conscious of the Canada student loans component of student assistance. We were very conscious of the support for post-graduate students through the granting councils. Those have been in place for decades.

Ms. Paddy Torsney: You travel in academic circles and with various people, including provincial ministers of education, who I understand are quite concerned about the level of student indebtedness right across this country at this time.

Mr. Tom Brzustowski: I certainly have heard that. I have heard it more from students than I have heard it from ministers.

Voices: Oh, oh.

Ms. Paddy Torsney: I think the first ministers agreed at their last meeting that they were quite concerned about this, and this is just another tool to help relieve that pressure.

I guess what is particularly interesting about this foundation is that this foundation, unlike other mechanisms, can also attract private sector endowments. Is that correct?

Mr. Tom Brzustowski: That is correct. It can attract gifts or any sort of donations from individuals, but it is very clear that the money would have to be used for scholarships.

Ms. Paddy Torsney: So that would further enhance the number of students that this program could help?

Mr. Tom Brzustowski: Yes.

Ms. Paddy Torsney: That is the extent of my questions.

I think you're next.

The Chairman: Thank you. Ms. Redman.

Mrs. Karen Redman (Kitchener Centre, Lib.): Thank you, Mr. Chairman.

To pick up on the two previous speakers' themes, obviously the thrust of the millennium scholarship is to address student indebtedness and post-secondary education. But I see it, as well, as a multi-pronged approached. One of them is to encourage students to go to educational institutions out of province. Can it not also be used as a tool to encourage enrolment in provinces where they may not have the uptake on post-secondary education? Again, I'm addressing the fair and equitable manner across Canada and exactly how it might unfold.

• 0955

Mr. Tom Brzustowski: It's a very interesting question. Certainly part of the bill does allow the board to recognize additional costs for people studying out of province. People study out of province because of an individual decision based on spaces available, admission standards, wishing to live away from home, and the particular strengths of the given institution. There's a lot of mobility across the country at the moment. Perhaps this would promote it; it would certainly recognize it.

I don't see mechanisms in here that would promote people making decisions to study out of province unless those decisions hinged on the cost factor of living at home or away from home. Many people make decisions for other reasons, but for those people, yes, it could make it easier.

Mrs. Karen Redman: Thank you.

The Chairman: Thank you very much. That concludes the question and answer session.

Do you have one final question? Okay, I go to Mr. Ritz and then to Mr. Crête, for two short questions.

Mr. Gerry Ritz: Thank you, Mr. Chairman. I have just a short question.

You talk about students being in financial need. Every student out there is in financial need to a different degree, so it makes it tough to pick and choose. As far as transferring to other provinces is concerned, students in the most need financially are not looking to educate outside their home area; it costs more, they just can't afford it.

Merit is a relative thing: it depends on the courses you're taking, and there are degrees of difficulty. These are all little addendums to your decisions on these students, so I'm wondering whether an appeals mechanism is in place for students who feel they have wrongly been left out.

Mr. Tom Brzustowski: I can't imagine any process that distributes money that wouldn't have some appeal process. My own organization, NSERC, has an appeal process, even though it's the community of peers who make the judgment. I'm quite sure that when the board actually decides the details of the mechanisms, they will make some provision for an appeal. I'm sure if they didn't, that decision would be appealed by somebody.

Mr. Gerry Ritz: You're one of the architects of this scholarship fund, and you seem to have problems with the mechanics of it as well. We as legislators are asked to vote this in, but we're buying a pig in a poke. Until the nuts and bolts of it are ironed out, how can we in good conscience vote this through?

Mr. Tom Brzustowski: I think you've given me unnecessary credit by calling me an architect. I think what we've got is a site plan. If the site plan is approved, the people who will become the board members will hire the architects, the staff. It will be an enormous management task to design this process.

I think it will trivialize the challenges to think a group, even a group of perhaps a dozen or fifteen very experienced people, could have nailed down the details, particularly since there are strong opinions on both sides of a number of issues that will have to be resolved before the design comes down.

What you're looking at here is a site plan. I fully expect that the board appointment process, which is spelled out in painstaking detail in the bill, will move forward and that the members of the board will then act to appoint the chief executive and the experienced staff, who will actually get involved in the design. I can't imagine they would actually design anything without extensive consultation across the country.

This is quite a challenging process. While I'm very pleased to be given as much credit as I seem to be for my contribution to it, I really must be accurately modest about it. This was a discussion of the site plan, and nothing more than that.

[Translation]

The Chairman: Mr. Crête.

Mr. Paul Crête: I would like to ask you for the names of the members of the group that worked with you, and I would also like you to clarify whether or not you participated in this determination that 5% of the expenditures for the Foundation would go towards administration. Did you in your group work on this issue and did you submit an opinion or opinions?

In addition, do you agree that the best way to proceed, with respect to Quebec's system of loans and grants, would be to enable the province to opt out with full compensation to ensure that the money earmarked for this program will be used as effectively as possible?

• 1000

[English]

Ms. Paddy Torsney: On a point of order, I think the first question Mr. Crête asked would be more appropriately directed to the minister or to his parliamentary secretary, rather than to the witness.

The Chairman: Mr. Crête.

[Translation]

Mr. Paul Crête: A member of the committee would, in fact, like to have the names of those people who worked on this committee.

[English]

Ms. Paddy Torsney: He is not the head of the committee, and it's more appropriately directed to the minister or to the minister's parliamentary secretary.

[Translation]

Mr. Paul Crête: I would like to clarify something, Mr. Chairman. It would appear that we are hearing Mr. Brzustowski this morning in his capacity as a representative of this group in order to assess the efficiency and relevance of the work. Generally speaking, we receive a brief containing a list of the members and another brief, which is tabled and which contains the text of the presentation. This is how we usually operate.

At any rate, I would like him to be able to answer the question. If he cannot do so, this may cast some significant doubt on the work done by this committee, on the flexibility it was given and on its effectiveness. Is this a secret committee? What about transparency?

[English]

The Chairman: Ms. Torsney.

Ms. Paddy Torsney: My premise still remains. Although the witness is here to discuss some of the thinking in terms of the mandate, the committee members, and the administration, this is an advisory group and he is here to tell us about his and their thinking in setting up this scholarship fund. Those technical details are more appropriately directed to the bureaucrats, the minister, or the parliamentary secretary. He is not an administrator. He is not responsible for that kind of information.

[Translation]

Ms. Christiane Gagnon: Did this committee have a chairperson?

[English]

The Chairman: Excuse me, Mr. Crête.

Mr. Brzustowski, do you have a problem with the question?

Mr. Tom Brzustowski: I do. This is the second group I've been involved with in which I have had to swear an oath of secrecy, and I don't know—

The Chairman: Okay. I think we got your point.

Are there any further questions? Mr. Valeri, do you want to add anything? Mr. Crête.

[Translation]

Mr. Paul Crête: I asked a question that had nothing to do with the membership of the committee, and it seems to me that this is something that should not be secret. I also asked a question about the 5% administrative costs and the right to opt out with full compensation. None of this should be secret.

We are learning new things every day in this government. It is not at all normal that a committee responsible for advising the minister cannot know who is working on this committee. In my opinion, this should not at all be kept secret. That's what I have to say about it.

[English]

Ms. Paddy Torsney: On a point of order, you have misrepresented my position. I have not said that you shouldn't get the information. I am suggesting the question is directed to the wrong person. That was my point.

The Chairman: And Mr. Brzustowski agreed.

We have one final comment from Mr. Valeri.

Mr. Tony Valeri (Stoney Creek, Lib.): If what Mr. Crête is asking for is the list of names of those individuals who form part of the advisory group, along with our witness today, I don't see any reason why we would not be able to provide it. In fact, I believe there was a press release at the time of the announcement of the millennium fund that included the list of the members of the advisory group.

The Chairman: Mr. Crête, it's a matter of looking through your archives at your office to find that.

[Translation]

Mr. Paul Crête: Accordingly, the list is public. It is therefore not prohibited to provide the names of the members of the committee. According to my colleague, my question is simply not relevant at this time.

[English]

The Chairman: Mr. Valeri will provide you with the list.

Mr. Brzustowski, thank you very much for your comments. They've been helpful, and we thank you for helping us out with this.

[Translation]

Ms. Christiane Gagnon: Mr. Chairman, we haven't finished. We have two more questions.

Mr. Paul Crête: I'm waiting for an answer about the estimated overhead costs of 5%. Did they work on this? Moreover, the witness was prepared to answer this question.

[English]

The Chairman: He answered that one.

[Translation]

Mr. Paul Crête: My second question dealt with the right to opt out.

[English]

The Chairman: You didn't answer that question in a previous question?

[Translation]

Ms. Christiane Gagnon: No.

[English]

The Chairman: No? I thought you did.

Mr. Tom Brzustowski: What I didn't answer, Mr. Chairman, was on the basis on which I might have confidence in the 5%. My own organization, NSERC, operates at 4% with what I hope is a rather more complicated evaluation process than the foundation will have, so I think the 5% is entirely reasonable.

I must say that of the three questions, that's the only one I'm competent to answer.

• 1005

The Chairman: Thank you very much.

We'll now proceed to the next witness. From the Canadian Action Party, we have the Honourable Paul Hellyer.

Mr. Hellyer, welcome to the finance committee.

As you know, Mr. Hellyer, the order of reference is Bill C-36. We look forward to your comments, which I'm sure will be quite helpful in dealing with this bill. I think you know how finance committee hearings work. You may begin.

Mr. Paul Hellyer (Party Leader, Canadian Action Party): Thank you, Mr. Chairman and members of the committee. I would like to thank you for the opportunity to speak briefly concerning part 13 of Bill C-36, the section entitled “Financial Assistance to International Financial Institutions in Foreign States”.

If it were my privilege to have a vote on this section, my conscience would demand that I vote against it. In the few minutes available to me I would like to give you some of the reasons why.

The International Monetary Fund was part of a 1964 agreement by the major capitalist powers. Its role was to facilitate convertible exchange by providing temporary assistance to countries that had depleted their foreign exchange reserves. This allowed them to pursue high growth and full employment through low interest rate policies. It was an era when capital controls were permitted and the IMF was actually mandated to ask for such controls if deemed either necessary or desirable.

I'm informed that the IMF has never requested capital controls or suspended credits, even when there was a large or sustained outflow of capital. For most of the Cold War period its importance as an emergency lender took second place to official grants and credits designed as much for political as for economic advantage.

With the advent of commercial bank lending to third world countries and the increasing deregulation and globalization of financial service, it has abandoned its raison d'être almost totally. Instead of a lender of last resort, it has become the enforcer for international banks and financial institutions and performs a role comparable to the bouncer at a glitzy bar. The big banks invite third world countries to line up for drinks on credit. When they drink too much and exceed their credit limit, the IMF takes over as an enforcement agency.

• 1010

Its tactics are brutal. It refuses to allow supplicant countries to impose capital controls. Instead it demands that they raise interest rates to attract foreign capital. This slows the economy and results in increased bankruptcies and high unemployment.

Governments must also reduce expenditures for health and education. Food subsidies in most cases have to be eliminated. Instead of growing food for its own citizens, the government is coerced into growing crops for export to earn the U.S. dollars to repay the IMF.

It was this kind of Draconian policy that led me to ask in a book I published in 1996 whether the IMF had not outlived its usefulness. Since then I have come to the conclusion it has. It would be a great boon for the world to wind it up and turn its assets over to the World Bank to use partly for debt forgiveness to the world's poorest countries, including a number of African countries, and partly to provide a massive amount of capital for microbanking. This would offer hope and opportunity to millions of impoverished people worldwide. As ours is not a world of logic and common sense, however, one has to assume that the ideal is unlikely to happen in the short run, and it is more profitable to deal with more likely scenarios.

The IMF's current policy line stands the original Bretton Woods on its head. Instead of recommending, or at least permitting, capital controls to mitigate the consequences of massive inflows and outflows of capital, it takes the opposite position. It is making capital controls a major target of attack, in direct violation of article VI. It does this on the pretext that global financial markets reduce the cost of capital and permit a better allocation of resources worldwide.

This neoclassical assumption has been refuted by the actual trends since the 1970s. Removing capital controls has opened the floodgates to an accelerating volume of financial flows. Foreign currency transactions have increased from about $18 trillion a year to some $250 trillion a year, which is about a trillion for each working day, a 14-fold increase.

World trade by contrast has little more than doubled. The ratio of foreign exchange transactions to trade soared from 6:1 to about 35:1.

The explosive growth of cross-currency financial flows has been paralleled by increasing volatility of both nominal and real exchange rates by sharply rising real interest rates. Instead of the cost of capital becoming reduced, it has become more expensive.

International bank lending also surged many times faster than economic activity. Outstanding international bank loans grew from 4% of the gross domestic product of the 24 countries of the Organization for Economic Cooperation and Development to 44% between 1980 and 1991. The additional members of OECD have signed up since that time.

All of this has been paralleled, however, by slackened growth of investment, savings, output, trade volume, and productivity in both the third world and the OECD countries, with the main exceptions, the east Asian miracle economies, now joining the pack.

This is a dramatic change from the earlier post-war years. The architects of the Bretton Woods Agreement believe unregulated financial markets tend inexorably to short-term speculation and increasing financial instability. This led to acceptance of controls on capital movements and the establishment of the IMF as a lender of last resort.

The current vogue is that international financial markets act as policeman to keep politicians' feet to the fire. They reward governments that cut back social programs and other spending designed to make life better for their citizens and penalize governments that don't.

In practice this theoretically perfect control mechanism has resulted in one crisis after another. The increasing frequency and severity of the crises and the fact they have been unpredictable have eroded the credibility of the Washington IMF line.

Reflecting on the current Asian collapse, Alan Greenspan, chairman of the U.S. Federal Reserve Board, observed that excessive leverage and short-term bank lending may turn out to be the Achilles' heel of an international financial system that is subject to wide variations in financial confidence. Indeed it may. A system under which megabanks print money willy-nilly to lend to almost anyone in the world who will line up for it is inherently unstable.

• 1015

The IMF bailouts only exacerbate the situation. The 1995 Mexican bailout sowed the seeds of the current Asian crisis. The assurance that the IMF will ride to the rescue encourages international bankers and speculators to make still riskier loans. They escape the consequences of their actions, while the costs of their excesses are socialized and picked up by taxpayers at large.

In the face of all the evidence it is more than astounding that the IMF is now pushing to have its articles amended. With the active encouragement of the Clinton administration it is pressing for broad, new powers. The IMF is seeking global authority over a national government's ability to control capital inflows and outflows, including the power to require member countries to commit to full capital account liberalization.

This move should be recognized for what it is. It would mean the end of national sovereignty in economic matters. No country would be master in its own house. The IMF seeks the power to control the world economy. The urgency, according to the IMF's first deputy managing director, Stanley Fischer, is dictated by the fact that the alternative mechanism to achieve the same ends, the Multilateral Agreement on Investment, has been slowed down recently.

The world should view the prospect with fear and trembling. It should be obvious to all except the most encrusted ideologue that the world financial system has been completely disconnected from the real economy. Wall Street, or Bay Street if you prefer, is in cyberspace and programmed to ignore the real needs of the vast majority of the world's population still in need of food, clothing, and shelter. Only the holders of financial assets, a tiny fraction of the world's population and the ones whose needs have already been met, have anything to gain from perpetuating the global mythology.

Even they have reason for concern. A globalized financial system dominated by highly leveraged banks is a recipe for disaster. When that disaster strikes, the social consequences are completely unpredictable.

That is the reason I would not give the IMF any additional resources that would encourage it to continue on its present path. Nor would I make support for needy countries conditional on their submission to the IMF's hurtful demands. Nations that have been brought to their knees by the IMF's sharp whip are understandably resentful, and Canada should not contribute further to the source of their anger. The IMF has not earned the trust of the people who pay the bills and should be cut off at the pass before it can do more damage to more people.

There are, of course, other financial reforms essential to a stable world economy. But as of today, this day, a total reformation of the IMF is probably the most urgent.

Thank you, Mr. Chairman.

The Chairman: Thank you very much.

We will now move to the question and answer session. Mr. Ritz, please.

Mr. Gerry Ritz: Thank you, Mr. Chairman.

Thank you, Mr. Hellyer, for your thoughtful presentation.

As we move on a fast track to more and freer world trade, you talk about other financial reforms being essential and our wanting to safeguard Canadian business at home and abroad. Could you please expand a little on what you see we need?

Mr. Paul Hellyer: A number of things have to be done, some of them more urgent than others. I have just suggested the IMF should have its wings clipped, so it ceases to do what U.S. trade representative Charlene Barshefsky has said it is doing in Indonesia and South Korea, which is forcing them to open up their borders to more U.S. goods.

I think Washington, the IMF, and the OECD should cease trying to abolish all controls on international capital movements and should instead start enforcing article VI of the IMF charter.

The world banking system must be reformed. It has to have its wings clipped. It is too highly leveraged. The international settlement— the BIS capital adequacy rules have proven to be too lax, especially with the way they've been applied in some countries, a notable example being Japan. When they operate with too much leverage, they tend to get in trouble and build up too much debt all over the world.

• 1020

It's my opinion that we have to impose cash reserve requirements and to increase them gradually over a period of years, both to slow down the banks and to provide national governments with the fiscal flexibility to do some of the things their people expect them to do on their behalf.

I'm also a very strong supporter of a foreign exchange transaction tax, something along the lines of what has been suggested as the Tobin tax. The people who are against this are the people who spend their time making money by dealing in foreign exchange. They have a lot of power, especially in Washington. That's one of the reasons the Washington administration opposed the Tobin tax so vigorously a few years ago and suppressed a number of studies that showed it might be beneficial to the world.

Something like that has to be done to slow down the traffic in foreign exchange, which is now destabilizing on an unprecedented and unacceptable basis, and to encourage legitimate investment. Probably a third reason would be to provide additional revenues for governments as a result of the small tax that would be imposed.

Things like that are very broad and comprehensive, and we haven't time this morning to go into the details of all of these things, but there are some tremendously important, major reforms that need to be considered.

Mr. Gerry Ritz: Do you see the banks merging in Canada as a positive step or a negative step?

Mr. Paul Hellyer: Well, I'm unalterably opposed, because it's part of the trend to reinforce a global financial system, which is unsustainable. All we're doing is getting into the whirlwind at, I think, exactly the wrong time. It would certainly encourage our megabanks, assuming we don't interfere with the 10% rule, to get more involved in foreign lending and, because of the IMF policies, to engage in riskier and riskier loans. They already have a track record of getting involved in third world and real estate loans, which almost did them in, and I think allowing them to be too big is likely to encourage them more in that direction.

What the world needs is not more megabanks to finance more mergers, to create more oligopolies worldwide. What the world needs are smaller banks, microbanking, banks for small entrepreneurs who need small amounts of money to finance their operations and grow and employ people.

We are actually going in the wrong direction. The megabanks are financing the mergers and takeovers that inevitably result in downsizing and the elimination of personnel—this will be the immediate case with the bank mergers, since somewhere between 15,000 and 20,000 jobs will be lost in Canada with the first two mergers, and then more with the next one—at a time when we want to create more jobs. Banks have a role to play in creating more jobs, but they seem to prefer to ignore it because small loans are more work and you have to make a lot of small loans to make anything like the amount of money you would make, especially with front-end fees, by financing some sort of a major merger or takeover.

Mr. Gerry Ritz: Thank you.

The Chairman: I'd like some feedback on Mr. Ritz's comment. I was intrigued by your logic that if a bank gets bigger, it would be engaging in riskier loans.

Mr. Paul Hellyer: I think this is true.

The Chairman: You're saying they would actually go out there and give more money.

Mr. Paul Hellyer: Yes, they create more money.

The Chairman: They'll create more money.

Mr. Paul Hellyer: Yes, and create it under circumstances that involve more risk.

The Chairman: So are you saying that consumers will be better off because they'll be accessing more money?

Mr. Paul Hellyer: No.

The Chairman: No?

Mr. Paul Hellyer: Most of that money will be used to finance the huge international corporations and mega-operations in consolidating worldwide and, in the process, divesting themselves of personnel. So you have a situation in which the banks are really financing both inflation and unemployment simultaneously, instead of providing more loans for small entrepreneurs when they provide financing for job creation. This is going in the opposite direction to what was originally their trust, in my opinion.

• 1025

The Chairman: You're saying they would engage in this because— according to you, it's an act of self-destruction.

Mr. Paul Hellyer: It's an act based on primary concern for making easy money, fast money, and lots of money.

The Chairman: You can't make money if the economy collapses.

Mr. Paul Hellyer: I know, but this is what is likely to happen if you have too many big banks worldwide making these kinds of loans. Let's go back over the history a little bit.

After Mr. Paul Volcker introduced us to the major collapse of our economies in 1981-82 and interest rates went way up, third world loans, which had been made when interest rates were fairly low, could not be maintained. They became non-performing. But the world never knew, because Mr. Volcker did something that is just the opposite to transparency, which is the word everyone is using these days.

He actually got the big bankers together. The big American banks were all technically broke. He got them together in a room and said, “Look, I know you don't want to do this, but you have to do it because I'm telling you to do it. You have to make new loans to those third world countries so they will have the money to pay the interest on the old loans so those loans will not be non-performing—in other words, so the world, and especially your depositors, will never know—until I can get the IMF to ride to the rescue with taxpayers' money.” He ultimately did that.

If you want to go through this succession, it goes back to those third world loans, way back in the Volcker era, and then on to crises such as the Mexican and now the Southeast Asian. What a lot of economists are concerned about, I guess, is that the next crisis or the one after could be what they call the core, which is the United States. You could have a major financial disruption worldwide, which would result in tremendous deflation and cause untold problems worldwide comparable to or even worse than the Great Depression of the 1930s.

There is a real concern about this. I guess you might look at me as sort of a living history lesson, because I've lived through it all. The system we have now is the one we had before the Depression. The crash of 1929 is what gave us the Great Depression. We abandoned it and started a slightly different system in the late 1930s in Canada, after the Bank of Canada was formed. The Bank of Canada started creating money on behalf of the Government of Canada at, in effect, zero interest rates, which gave the Government of Canada some flexibility.

We started to pull out of the Depression. We used this facility to help finance the war and the immediate post-war years and then to finance the post-war infrastructure of the roads and the airports and to help launch our social security system.

Then in 1974 the world changed. At a meeting in Basel, Switzerland, the world banks decided to abandon the system that had worked so well for 30 years or so and to slowly but surely revert to the one we'd had before. They called it monetarism, but since monetarism didn't quite work out it was rolled into neo-classical economics. Now in effect we are repeating all the mistakes we made during those years, mistakes that have given us 44 recessions and depressions over a period of less than 200 years.

This is what has gone wrong. It has resulted, as I stated earlier, in lower growth rates for economies, higher average unemployment rates, a fantastic increase in debt, and now higher interest rates for all the G-7 countries. The debt is growing faster than the rates of the economy, which is unsustainable.

All of these things are happening as a result of what I call the economic religion, based on— Milton Friedman and his colleagues of the Chicago school of economics, which was introduced into the world economy and into the Bank of Canada in 1974. Now we are pursuing this road, which will lead one more time to a tremendous disaster if we insist on carrying on the way we're going.

• 1030

The Chairman: Mr. Ritz has a follow-up question, and then we'll go to Mr. Crête.

Mr. Gerry Ritz: You talk about 15,000 to 20,000 jobs being lost in the banking sector as they merge and so on, and then you also talk about the banks lending to large corporations so they can get out there in these world markets that are being created.

Would the jobs lost in the banking sector not be picked up by the corporate sector as they expand? Is there not a trade-off there?

Mr. Paul Hellyer: No. All of the merging so far has resulted in reduction in employment, and most of the jobs that will be created, if any are created, will be created outside of Canada. They are jobs that in many cases are at substandard wages and so on. So there are a lot of implications.

What is happening with this globalization is we're turning the monetary system back sixty years and we're turning the social system back a hundred years, to Dickensian days, with a lot of the things that are being done in third world countries, where production is being substituted for production that used to take place in OECD countries, including Canada and the United States.

[Translation]

Mr. Paul Crête: I was extremely interested in your brief, particularly in what you had to say about encouraging speculation.

You mentioned the example of a rescue operation in Mexico, which had a ripple effect. Speculators realized that they could take far more risks if governments provide assistance in situations of this type. You say in your brief that this contributed to the current situation in Asia. I would like you to talk a little more about that, and give us more details as to what could and should be done.

You also say that if you had to vote on this part of the bill, you would vote against it. Do you think that something different should be done? In my view, part of the bill is the result of our international agreements, and commitments that we have made throughout the world. What would you recommend we do to ensure that Canada is sufficiently able to monitor the place in which it decides to invest, so that this is not done automatically?

I understood from your presentation that by passing the bill in its present form, we are fostering a banking system that lacks a strong foundation. Could you tell us a little more about these two aspects?

[English]

Mr. Paul Hellyer: I'll try.

First of all, I guess based on the confidence that they would be rescued, world banks, including banks in the United States, to a very small extent in Canada, and to a very large extent in Japan, lent money, created money to lend to Korean banks, for example, and Korean large corporations. Then, when the Korean central bank did what most central bankers do, and tried to defend the won by buying it and giving up their U.S. dollar reserves to the point where they eventually created a crisis and a run on the won, the foreign banks were faced with what would have been loans that were non-performing.

In some cases, as in the case of their third world loans earlier on, those loans were sufficiently large that if they had had to write them off, their whole capital base, or most of it, would have been eliminated. The logical consequence of this—and this is one of the reasons the whole thing is so serious—is that if they have to write off their capital base, then they have to contract their loans, and this is what brings on recessions and depressions. But they created this money largely on the assurance, I think, that because they had been bailed out two or three times before by the IMF, it would happen again.

• 1035

One of the policy recommendations that is being made now is that in any future crises, the risk has to be shared between the people who make these investments and the world community, through the IMF or whatever. I think that's a good idea. That might make the bankers pause a bit before making some of the loans they have been making in third world countries and in Southeast Asia. But it's a very tricky business, because the whole world banking system is a deck of cards.

I have a book called The Confidence Game: How Unelected Central Bankers are Governing the Changed Global Economy, by Mr. Solomon. I would recommend that you get it out of the library and read it. It will not help your sleep at night, because it will just recite the kinds of extravagances the world financial system indulges in and how precariously close to the brink they have come and continue to come to bringing down the whole financial system. That's the reason, going back to how the banks operate and their high leverage, that I said we have to reinstate cash reserves on a much more substantial basis and certainly in Canada to reinstate them period, because we have no cash reserves with our banks, as you know, and to make a system that is more stable.

The other thing is if you have some capital controls, which the IMF is now insisting be removed, and if you have that kind of crisis, whether it's in Canada or wherever, and people start to get nervous— If there are no capital controls, what would happen? Canadians would start moving their money out of the country. That makes a bigger crisis. Then foreign corporations in Canada would say the Canadian dollar's going to take a beating, so we'd better get out—not the factory, but any excess money they've got. So they move that out, and the whole thing starts to crumble. This is what happens when you have such a volatile system as we have, with this highly leveraged banking system worldwide.

I think something has to be done about that. But in the meantime, I think we have to say that we could prevent some of that danger by saying if there is a crisis we're going to clamp on controls temporarily and stop the money going out until the crisis is over. It may be three days, it may be 30 days, it may be 60 days, but at least there's something we can do.

If we go along with the IMF and free capital movements totally, we lose that power. You talk about sovereignty—sovereignty's gone; it's a myth. The sovereignty is in the world financial system, and it can wreck your country. It could wreck you in three or four days.

If people want to vote for a world government, where it's all run from a couple of offices by bureaucrats somewhere, okay, let them vote on it and have that kind of a world. But we haven't voted on that. I think a lot of people would refuse to vote for that kind of a world. If we want to have the kind of world in which we can actually expect our government to do something to save us and to help us when we're in trouble, then we've got to have a world where they have the tools available to be able to do that. One of those would be to say we've got a crisis here and we're going to slap on controls for a few days until we can get this thing under control.

That is what we are being asked to give up, both by the IMF and by the OECD, and really pushed by the Washington influence.

[Translation]

Mr. Paul Crête: Your presentation convinced me how accurate a young member of Parliament's reaction was. He said yesterday that we no longer control anything in this universe, and that Parliament was not necessarily the place where we could solve problems. You are saying something similar in a more thoughtful way, and with more arguments to back up your position.

Let us look at this bill in concrete terms. Would you prefer the status quo or an amendment saying that we will accept the existing rules, but only for three to five years, or something like that? And if the IMF did not review its position in line of Canada's interests, would there be any way out for us? Finally, would you prefer the status quo or another type of amendment?

• 1040

[English]

Mr. Paul Hellyer: First of all, if I may refer to the action taken by the young deputé yesterday, when I heard what he said, I said bravo, somebody's got it right. It brings tears to my eyes to say that, but this is the kind of world we're creating. It's a world where nation states count for less and where voters count for even less, because in effect, when you vote for someone, you really know that they won't influence very much the course of what's going to happen. It is a travesty of democracy. We really do a disservice to the word.

Coming back to your other question, I think I prefer the status quo as far as the IMF is concerned at this moment, in order to signal, “You have gone as far as you can go. You mend your ways and then come back to us if you want more financial support, but first prove that you are worthy of it, and that you are doing what article 1 said you should do, and that is to engage in policies that are beneficial to the people of the world, instead of going in the opposite direction.”

What I fear is that it's hard to teach old dogs new tricks. I don't know exactly how to translate that, but I'm sure you know what I'm talking about. I'm afraid if you just say, “Okay, we'll approve all of these things”, then they will say, “Well, everything is going on the way it is, and the next thing we're going to ask you for is to sign on to the increase in our power so in effect we can run the world economy, which is what we have in mind.”

I think sometimes a signal— It's sort of like a policeman saying, “Hey”, and waving his flag and saying, “Slow down—not next time I see you, but slow down now, and pay attention.” If you don't give any signals, then they will not take you seriously.

It's exactly the same parallel as the banks. Until the IMF actually hurts them a little bit by saying, “You're going to have to write off some money, and you're going to have to take a beating, and you're going to have to go to your shareholders and explain why you make these kinds of loans and cut their profits and their prospects”—until they do that, they won't be taken seriously. But when they do, they will be taken seriously.

I would say that if we just go along with what they're asking for, then they'll say, “Good old Canada—one more time into the breach. You can always count on them to go along with whatever is being proposed.” They will not take us seriously because they will think we're just—I used to resent this phrase a little bit when I was a part of it—a rubber stamp for the world juggernaut.

I think you have to run the flag up and say, “No, we've thought this through. We will help countries in distress, but we're not going to help them only when the IMF beats them with a brush. We will help them when they need help, not in order to coerce them into going along with measures that are not in the interests of their citizens, that cut back on the health, education and welfare of their citizens”, which is the way the IMF has been operating for a number of years.

Mr. Paul Crête: Merci.

The Chairman: Merci, Monsieur Crête. Mr. Brison is next.

Mr. Scott Brison: Thank you.

Thanks for appearing before us today, Mr. Hellyer.

You have described an extremely volatile global financial system. In such a volatile global system, is it not important that we have strong, Canadian-owned financial institutions? We've signed the WTO agreement for financial services. If we do not allow these mergers to occur, are we not jeopardizing more than 15,000 jobs, in light of the merger with Citicorp and Travelers, with competition from organizations including ING and Wells Fargo? How would you comment on that?

Mr. Paul Hellyer: Well, that is not my view. My view is that we would gain more jobs, not just the 15,000 but thousands of additional jobs created by small businesses, if we said to the banks, “We want you to spend a little more of your time paying attention to Canadians, who after all have given you this licence to print money.”

It's our licence. We own it. Parliament owns it. We gave them the licence. We don't even charge them a royalty. It is a little bit ridiculous, in my opinion, that we should let the banks create money to lend back to the Government of Canada, because then the Government of Canada becomes a tax collector on behalf of the banks.

• 1045

So I think, no, they're actually expanding worldwide at a comfortable clip at the moment, and I think that's fine. I would encourage them to do that. They're filling niche markets in various places in the world, and I think that's fine. That will probably protect them from the kind of potential disaster that would be likely if they were too big and got too complacent and too reckless.

I think the other part of the solution, of course, is to say we'll go along with the arrangements we've already made for foreign banks, but we will not encourage any further, and we will certainly not allow them to take over our main banking facilities, because that's how we control our monetary system, and we don't want to lose it.

Mr. Scott Brison: On your concerns with the speculators—and these are the same concerns that people like President Suharto have voiced, and more recently Prime Minister Chrétien, referring to the guys in red suspenders, for not having as much confidence in this government's fiscal policies as he does—typically the greatest opportunities for speculators exist when a country's monetary policy is inconsistent with its fiscal policy. That's not to say that its fiscal policy is good or bad, but when it is inconsistent with its monetary policy. If a country's monetary policy and fiscal policy are being run in sync, there shouldn't be any opportunities for speculators.

Mr. Paul Hellyer: Well, not necessarily, because no country is an island unto itself. If the speculators force one country to increase interest rates, for example, on their bonds, then the speculators say, “Hey, Canada isn't keeping up with the increase, so we'll have a little fun with them.” Within a matter of hours, they'll kick us around. Then the Governor of the Bank of Canada will say, “Well, gee whiz, if we don't go along with the gang, we'll lose some investment”, so he then has to increase our interest rates, which means fewer jobs for Canadians and more cost per Canadian homeowners and for Canadian businessmen and so on.

I just think that speculators are taking all of the cream off the work that people are doing worldwide. If you just look at it, the increase in the value of bank stocks recently are 50% or more, so for people who have money and were lucky enough to own bank stocks, they've made this kind of—

Then you look at the increases being given to people who work in the fields and the farms and in manufacturing, and ask some of the people at Canada Packers, who've just taken a huge cut in pay, how they square this with these huge increases being made in the financial sector. Of course, the answer is you can't square it, because the world is moving towards a system where the people who play with money in this financial economy make far more and have far more claims on the real economy than the people who do the work and the people who actually labour in the fields.

This is what I mean by the complete separation, the “disjoint” between the two economies. Somehow we have to re-effect a marriage. The way to re-effect a marriage is to have tighter guidelines, for example, on our banks, and say, “We want you, when some of these little entrepreneurs come along to you, to take a little risk—not like your third world loans, but give them a little help and be prepared to lose a few of them, because you will lose a few of them. But at least you're going to create jobs in Canada. That way, you will justify our continued policy of leaving you this licence to print money, or some part of it.”

Mr. Scott Brison: One thing we have to keep in mind, though, is that over 50% of Canadians are bank shareholders, either through pension funds or mutual funds and RRSPs, etc. So when we speak of bank stocks having grown in value significantly, over 50% of Canadians and their retirement savings have benefited directly from that growth and wealth.

Just quickly, you mentioned— Did you read the article that was in the Atlantic Monthly about a year and a half ago by George Soros on the future of capitalism, and his concerns about the sustainability of capitalism?

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Mr. Paul Hellyer: Yes, I did. I remember him saying that unfettered—and he underlines that word as I do, because I have been a capitalist all my life and still am—capitalism has replaced fascism and communism as the greatest threat to open societies. I agree.

What we are developing now is unfettered capitalism. It doesn't help all the people equally. Although you say 50% of Canadians are shareholders in banks—and I can't dispute that because I haven't really done all the arithmetic—some of them would have very small numbers and some of the people I know have very large numbers.

But I don't think even shareholders in banks—and I am one of them and my wife is another one—would want them to prosper a little bit more at the expense of Canadians being unemployed, being discarded from the mainstream of society, not having any purpose in life, not having any hope and having their aspirations dashed. I just think there is a little common decency in most of us and that we could maybe take a slightly smaller increase in the capital appreciation and share the wealth a little bit.

Mr. Scott Brison: In closing, I hope we can continue this conversation at some point in the future.

There was another article in The New Yorker a few months ago. A Wall Street bond trader was discussing his concerns about the future and he felt that Marx may have been wrong about communism, but he was afraid that Marx may have been right about capitalism.

Mr. Paul Hellyer: He sees that it sows the seeds of its own destruction, which is what George Soros is saying and what I'm saying.

Mr. Scott Brison: For capitalism to be sustainable, everyone needs access to the tools. That means a strong health care system and a strong education system, etc.

I look forward to continuing this at some point in the future. Thank you.

The Chairman: Thank you, Mr. Brison. Mr. Riis.

Mr. Nelson Riis: Thank you, Mr. Chairman.

Mr. Hellyer, you make Las Vegas look like a Sunday school picnic in terms of the gambling that takes place there.

Mr. Paul Hellyer: That the primer.

Mr. Nelson Riis: It's a primer.

Your presentation is one of the most interesting ones I've heard in a long time and a great deal of food for thought.

We're being asked today to provide more authority and also more discretion to the Minister of Finance to allocate funds to the IMF. You would be aware of the Auditor General's 1992 report, where he makes a very strong point about the lack of transparency in the system at the moment.

Would you be advocating things like expecting our directors at the World Bank and so on to be reporting directly to Parliament in a more transparent way, or enabling parliamentarians to know how their funds are being expended through the IMF?

Mr. Paul Hellyer: I think there's a lack of transparency all through the process, and this is probably one of the things the young man yesterday was concerned about.

Without the Internet, most of us wouldn't know that these things are happening. Through the Internet we learn about the financial transaction agreement and what Canada's position was. It would have, I thought, have been helpful to have a great debate in Parliament and in the country before this sort of thing would be signed.

The same is true about capital liberalization, about the extent of foreign ownership, whether we should have the right to impose conditions and limits, which are equally important, on foreign ownership of Canadian resources.

These things somehow have not been debated widely in the public domain and it's only thanks to the Internet that a lot of people have found out what is going on in the world. It's as though after the fact you're running to try to catch up with the bus, as it were. You see it going down the road and you say, hey, stop, let's have a little chat before you put this stuff all in concrete.

I think the lack of transparency is a problem. It goes right up to the Bank for International Settlements, where, as you know, the central bankers of the world meet in secret. They don't even allow finance ministers. We talk about responsible government when Alan Greenspan has more power than the President of the United States and Gordon Thiessen has more power than the Prime Minister of Canada to determine the welfare of Canadians. They meet in secret and make decisions that not even, in many cases, our top elected officials know about.

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I guess it's a long way of saying I agree with you that there should be reporting from the people who represent us at these international organizations. They should at least be required to come before Parliament and say, “We've been at a meeting of the IMF or the World Bank and this is what was discussed and this was Canada's position. This is maybe some of the contrary positions that were put in by third world representatives and something you should know about.” That would help us with the kind of debate that these huge issues really require.

Mr. Nelson Riis: You mentioned in your presentation a number of points about various controls, and you commented about the Tobin tax or some version of that. Interestingly, Canada's very interested in Chile. We've just been down in Santiago, and a few weeks ago an article in the Globe and Mail pointed out, in an interview with the Minister of Finance from Chile, that under their particular system—I can't pronounce the Spanish word—foreign investors, whether they're buying stocks and bonds or investing in a mine, have to deposit funds equivalent to 30% of their investment with the country's central bank and leave it there, interest free, for one year. It goes on to say this reserve requirement discourages at the margin only investments that are very short-term, and biases investments towards long-term, meaningful, job-creating investments.

He goes on to say, and this is presumably the point you're making, that institutions such as the IMF and institutional investors in developed countries don't like Chile's investment restrictions and are urging them to drop them. So, again, if we're looking to see why the economy of Chile is particularly hot compared to others, presumably this might be one of the reasons.

Mr. Paul Hellyer: I think the Chilean policy is a legitimate one. I'm certainly on their side of this argument.

I heard a Canadian mine executive on the radio the other day describing the situation in Chile, because he's just opening a mine down there. He said it's a nuisance, but it's not a big enough nuisance to prevent you from opening a mine. What it does is eliminate a lot of the instability from hot cashflows, which are the things that are most disturbing the world.

I think that every country should have the right to be able to impose something comparable to what is called the “Chilean bump”. Just say, show us your legitimacy, show us that you're here to start a mine, or to build a factory or to do something serious. You can take profit out in the meantime, but you have to show your bona fides and not just come rushing in and try to make a few fast bucks over the weekend and then rush out and leave us all picking up the pieces.

I think the Chilean example is a very valid one for anyone considering the prospect or the lack of desirability of opening the world up totally to free capital flows without restrictions.

Mr. Nelson Riis: You'd be familiar with our Minister of Finance's initiative in the international supervisory surveillance secretariat, which he has proposed. He suggests that the possibility would be that this secretariat would serve and report to the IMF and the World Bank. Do you know anything about this, Mr. Hellyer?

Mr. Paul Hellyer: I know that the World Bank—at least the IMF—is pushing it and I think, to be honest, they're attributing a potential that probably exceeds what is likely to result from it.

The one thing that has become very clear is that no one can predict the crises. The IMF has been ticked off for not predicting the Asian crisis. The World Bank has been— a lot of, I presume, individual bankers have been in their back rooms, but in an open world, global, financial system, things happen so fast that nobody can predict them. And this is the problem. You may not have more than 24 hours or 48 hours notice of a tremendously important crisis. Then if you can't do anything about it, it's just going to get worse.

Sure, it's not a bad idea to have a few people out keeping an eye on what's happening in various parts of the world, but it is no substitute for the tools that are necessary for national states to be able to act in case of emergency. I think it's the loss of these tools that one should be most concerned about.

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Mr. Nelson Riis: I have one more quick question to allow my colleagues a good opportunity.

You mentioned that we are on this road to disaster. I don't think there is any other conclusion one could draw from your presentation. In terms of the IMF's activities in countries in the last handful of years, can you identify any area where they actually imposed something good on a country? When I say “good”, I am of course referring to the majority of the population.

Mr. Paul Hellyer: I am not familiar enough with the details. You can get their individual agreements on the Internet, and it is probably a good idea to call them up and take a look at them. A friend who brought up the one on Korea the other day said it was Draconian and requires them to do all sorts of things, including totally opening up their banks to foreign ownership. In my opinion that is not good. In my opinion it is unacceptable behaviour. But this is the kind of policy being imposed on the world by the people who believe in what they call the Washington consensus—that the world has to be run the way the IMF, Wall Street, World Bank and others say it should be run.

So I am very skeptical about the trend. I said disaster was inevitable, but that would take us into the banking system to a depth that we don't have time to go into this morning. But the way the banking system works, almost all new money created is debt. It is debt on which interest has to be paid, and if no one creates any money with which to pay the interest, then what do you do? It is obvious—you have to borrow more in order to pay the interest on what you already owe, so just keep going deeper and deeper into debt. This is the system.

Every once in a while consumers do not have enough cash to buy the goods and services being produced by all of these dramatic new developments worldwide, and that is when you have a depression or recession. It has happened many times before, and as long as we pursue this system, which has been tried and failed over and over again, it will happen again. So we have two choices. Either we can change the system now and try to avoid that kind of disaster, or we can just fail to learn from history and go on the way we are going. Everybody should have a few gold coins in the basement and no mortgages on their house or farm or whatever, because they are likely to lose it next time around.

Mr. Nelson Riis: Thank you.

Thank you, Mr. Chairman.

The Chairman: Thank you, Mr. Riis. Ms. Torsney.

Ms. Paddy Torsney: Just to clarify, Mr. Hellyer, it is not all of part 13 that you are opposed to, just clause 127 on the payment to the IMF, and clause 129 on the clarification on the payments. But the general concept of part 13, where the Minister of Finance is required to be consulted before the Minister of Foreign Affairs makes any payments, is not a problem to you.

Mr. Paul Hellyer: I don't object to consultation between the two ministers. There are two things that I object to. First is giving the IMF any more financial resources before they have proven they can use them more judiciously in the interests of the world's citizens. Second, it is not good that Canada should encourage the kind of Draconian policies that the IMF has been imposing on countries around the world by saying they will only lend money if they sign an agreement with the IMF. There may be some time in the future when that would be okay, after the IMF changes—if and when it ever does—but if it continues the way it has been going for the last 15 years, I would not want to tell any poor country that we will lend them money only if they knuckle under to the demands of the IMF.

Ms. Paddy Torsney: To clarify again, you are only concerned about part 13 of this particular bill, which relates directly to the IMF—the increased payments for instance. And with regard to how the IMF works and our policies vis-à-vis the IMF, which technically are not in this bill, you would like a review.

Mr. Paul Hellyer: The two provisions are really the guts of the bill, though. One is for increased resources for the IMF and the second is to make loans to countries in need, provided they have agreements with the IMF. So it is really the guts of the bill.

Ms. Paddy Torsney: Second, I wanted you to note that at the recent Inter-Parliamentary Union meeting, the supplementary resolution was on countries indebtedness. The Canadians there took a position that we absolutely had to be aware of making sure that human rights, health and education and social services were not the first to go, and that the plans for restructuring or working through the economy were plans that those countries themselves had a fairly high level of determination in making.

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Mr. Paul Hellyer: I'm glad to hear that. Actually, Canada's record in debt forgiveness and so on is pretty good as compared to some other countries, so I think we can give ourselves a little pat on the back there.

Ms. Paddy Torsney: We mentioned that we had forgiven a debt, in particular in sub-Saharan Africa, so we did advocate a positive position, as I think you would agree.

Mr. Paul Hellyer: They are still in need of a little additional debt forgiveness, I think.

One of the changes, and I'm sure you're aware of this, is that back in the days when governments provided more of the assistance, they were in a position to be more flexible and to write them down or write them off if they wanted to. But then the international banking system sort of took over and the IMF became the enforcer, and the IMF is much more inflexible. It doesn't write off its loans. It sets the terms of repayment and it asks for these Draconian measures in order to make sure it gets its money back in U.S. dollars.

I think that is part of the objection, and of course insisting that countries open their borders to more imports or to capital inflows may exacerbate the situation. After all, more imports from the United States won't solve the currency crisis in Southeast Asia, it's going to exacerbate it. Under those circumstances some national government might want to say we need import substitution until we get out of this mess, but what is being proposed worldwide is taking away their ability to do that sort of thing.

Ms. Paddy Torsney: Thank you.

The Chairman: Are there any further questions? Mr. Riis.

Mr. Nelson Riis: Tony Valeri sits in rather a special position around our table because of his more direct attachment to the world of finance.

How does Mr. Valeri feel about this report? This report is scathing. It condemns almost everything we do as a country. It seems to me to be worth more than simply a couple of questions and then we leave. Perhaps it's up to you, Tony, to give us some guidance and leadership on this issue. He's questioning the fundamental work that we do as a country through the IMF and World Bank, let alone our banking system. We've raised the bank mergers. We talked about the possibility of more foreign banking coming into Canada, etc. Wouldn't it seem that we have more questions?

The Chairman: You had your questions, right?

Mr. Nelson Riis: I have hundreds more, but I was going to give my time to my colleagues across the way who haven't had a chance to ask any yet. I have hundreds I'd that like to ask, but I assumed others would want to ask questions.

Fair enough. If they don't, that's fine, but it seems odd to me.

Ms. Paddy Torsney: Can I make an intervention?

In the last Parliament we had a joint foreign affairs and finance subcommittee on international financial institutions. It met from time to time to discuss some of these issues and to hear from some of the development banks. We had some great meetings with Wolfensohn from the World Bank. If there's an interest, we could look at setting up something like that again.

Mr. Paul Hellyer: I asked to be heard by that committee, but the chairman lost my letter.

Ms. Paddy Torsney: As the vice-chair of that committee— we did not meet terribly frequently and we mostly restricted it to the big banks—the African Development Bank and the Asian Development Bank.

The Chairman: Mr. Hellyer, I was happy you were here today.

Mr. Paul Hellyer: Thank you.

The Chairman: I found your perspective to be quite unique.

Mr. Valeri.

Mr. Tony Valeri: Thank you, Mr. Chairman.

I just want to tell Mr. Riis that I take every opportunity I can to digest and read and question individuals on areas of interest. So I appreciate your intervention, Mr. Riis, but everything I heard from Mr. Hellyer this morning was information that I have heard before with respect to the IMF.

• 1110

There was a meeting in Washington last week with the IMF and the World Bank where the discussion, as you are probably aware, Mr. Hellyer, was about the role of the IMF in the Asia crisis.

This is all information that's been out there for weeks, Mr. Riis. While I appreciated Mr. Hellyer's interventions this morning, I would have hoped that perhaps he would have had a little bit more to say about the proposal put forward last week by Canada. It was fairly well received by other countries in that there was and still seems to be a real need for some type of entity that would provide a greater transparency to individuals when it comes to investing in other countries.

It was in the communiqué, I believe, that the idea of burden sharing was certainly front and centre after the Asia crisis. There has to be a mechanism for the sharing of burdens. There should no longer be a free ride for speculators to come in and out and do a bunch of things that makes them money and leaves countries in devastation.

So perhaps in another forum we could continue a discussion more particularly about the proposal that's out there: the upcoming meetings that will take place in Birmingham, England, with the leaders of the countries that are going to follow through now on this finance ministers meeting on what the roles should in fact be.

To answer your question, Mr. Riis, a lot of this information is information that I've heard before.

Mr. Hellyer, I want to echo the comments made by the chairman and thank you for coming before the committee. I think everything you said this morning was certainly helpful for this committee to hear.

Mr. Paul Hellyer: I appreciate the opportunity to be here. As you may have guessed, I just don't trust the IMF. They're the world's number one meddlers in other people's business.

I remember it wasn't long ago that they told Canada that our NAIRU should be 8.75%. I can't remember many bits of advice that we've received from foreigners that I appreciated less, because when I was young there was no such thing as a NAIRU or a natural rate of unemployment. There was high unemployment or low unemployment.

Professor Friedman and his colleagues invented these things to try to explain the inexplicable. For them to say that we should have an 8.75% floor on unemployment in this country is just absolutely, totally unconscionable, and I know Mr. Martin agrees with this. He has, in effect, said as much.

So it's that kind of advice— and if you look through the file, they just give what I consider bad advice to one country after another. They're part of this total neo-classical approach to what's going on in the world, which I say has to be reversed, and quickly, or else we'll do what we've done before. We'll have the crash and then the phoenix will rise out of the ashes as it has before. It's the same old questions. If we don't learn from history, we're doomed to repeat its mistakes, and that's our position as of now.

Mr. Tony Valeri: I believe Canada has learned from the Asia crisis. Unquestionably, as we move into this global economy the success that Canada has had in dealing with the deficit situation— certainly the burden has been shared by all Canadians. It's incumbent upon us as a government to ensure that we don't put the success we've had domestically at risk because of a financial crisis in another part of the world and because of the impacts of globalization.

In a large measure that's really the genesis behind this type of proposal that Canada put forward. We want to protect the success that Canadians have had. The way we need to do that is certainly to learn from the mistakes of the past but also to put in place some type of entity or mechanism that is a World Bank, an IMF and a member country initiative. We can all assist with the financial expertise, which all countries participating in this entity have, to ensure that other countries are in fact coming clean with what is going on in their country.

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That's really the proposal that Canada put forward last week, and perhaps for a long time member countries have looked to Canada for leadership on this issue. It was very well received, and as a country and as members of Parliament for Canada, we can certainly support and appreciate what went on last week. It was something that Canada has done.

Mr. Paul Hellyer: Don't give away your independence.

Mr. Tony Valeri: I agree.

Mr. Paul Hellyer: The greatest leadership you can give the whole world at the present time is to say no, we're not going to give up all of our power to the IMF or the OECD or anybody else.

Mr. Tony Valeri: Sure, and the comments were made that the Chilean experience perhaps needs to be looked at in more detail. We should not allow the IMF to take over all kinds of jurisdiction with respect to capital flow. Those interventions were made on behalf of Canada.

The Chairman: Thank you, Mr. Valeri.

Once again, Mr. Hellyer, thank you very much for your intervention.

Mr. Paul Hellyer: Thank you. I appreciate it.

The Chairman: For members of the committee, this is just a reminder that the next meeting will be held Wednesday, April 22, from 3.30 p.m. to 5 p.m. We will be dealing with parts 4 and 7. From 7 p.m. to 8.30 p.m. we will be dealing with part 11. The meeting will be held in room 362, East Block.

Mr. Crête.

[Translation]

Mr. Paul Crête: Mr. Chairman, will we be hearing from the groups in the order in which they appear on the agenda, that is the Canadian Cancer Society, followed by the Indian band?

[English]

The Chairman: We will be meeting with the Kamloops Band first.

[Translation]

Mr. Paul Crête: The band first and then the Canadian Cancer Society. Different members may be here for the two witnesses, given that the issues are very different.

[English]

The Chairman: So that's the rule. That's what's going to be done. The Indian band is going first.

Ms. Torsney.

Ms. Paddy Torsney: I'd just like to note that we're meeting on Wednesday night. Most of us have a forum for young Canadian students in Ottawa each Wednesday night for the next couple of weeks. If we could try to avoid missing those events with our constituents, it would be very helpful.

The Chairman: Okay.

Ms. Paddy Torsney: Thank you.

The Chairman: That completes our meeting. The meeting is adjourned.