Skip to main content
EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, May 30, 1995

.1530

[English]

The Chairman: I call the meeting to order.

Good afternoon, ladies and gentlemen. Welcome to the Standing Committee on Industry. Today we are pleased to welcome the Minister responsible for the Federal Office of Regional Development in Quebec and the Minister of Finance, the Hon. Mr. Martin.

Welcome, Mr. Martin. I understand you have some people with you, and perhaps an opening statement. I'll ask you to introduce your officials and proceed.

[Translation]

The Honourable Paul Martin (Minister of Finance and Minister Responsible for the Federal Office of Regional Development (Quebec)): Thank you.

Mr. Chairman, colleagues, it's a pleasure for me to speak to you today as minister responsible for the Federal Office of Regional Development in Quebec.

Let me first of all introduce the officials accompanying me: the Deputy Minister, Mr. Renaud Caron; the Assistant Deputy Minister, Operations, Mr. Robert Bourgeois; the Assistant Deputy Minister, Policy and Liaison, Mr. Michel Cailloux; and the former Assistant Deputy Minister, Corporate Services, Mr. Hugues Lacombe, who is now Assistant Deputy Minister at Human Resources Development Canada.

First of all, I would like to outline the changes that are currently underway at the Federal Office of Regional Development and which we consider of utmost importance.

It has been a year since I told your committee about our plan to carry out a strategic repositioning of FORD-Q. To achieve this the Federal Office decided to take concrete and effective measures to make the dynamism of SMEs the lead agency for developing the economic potential in every region of Quebec.

We undertook this repositioning in the context of the world economy with its changing trends, globalization of markets and greater emphasis on competitiveness. The entire process took into account the key role SMEs play in economic development.

[English]

Mr. Chairman, in repositioning FORD-Q over the last year, we have been very conscious of a number of things. I will mention three. First, there is the need to strengthen the co-ordination that is required if we are to have a fruitful relationship with many of the government departments and other interventions in the province. Second, there is the need to ensure that FORD-Q's activities maximize their impact and avoid overlap and duplication with other levels of government. Finally, there is the need to ensure that FORD-Q's activities are done in cooperation and partnership not only with other government departments and agencies, but above all with community stakeholders.

[Translation]

Over the past 12 months FORD-Q has been managing a heavy program and at the same time has been developing new tools in line with the new economic realities. I can tell you that in 1995 FORD-Q is no longer a mere funding agency but has become a bona fide support organization for economic development which, through its service delivery, is able to assist SMEs in all regions of Quebec in their efforts to keep abreast of world developments.

I want to make clear that this new strategy for action was not devised in an ivory tower but is the result of comprehensive consultations with leaders of SMEs from all regions of Quebec. They themselves expressed their needs. They no longer expect governments to provide abundant subsidies but want a collaborative approach focused on strategic information and networking. They would like government resources and services to be adapted to their performance criteria, and not the other way round, as has often been the case.

.1535

We have been guided by their wise advice. FORD-Q's repositioning, as I am outlining it to you today, is based on three major thrusts:

- first, a different approach;

- second, a redefinition of its regional development role;

-third, an overhaul of our strategies and development tools.

For the next few minutes I'd like to give you an overview of the elements I've just mentioned.

First, there's a different approach. For a long time the ultimate objective of regional development was to create an economic base in order to develop the potential of the various regions of the country. Over the years, as a result of this philosophy, the regions have developed valuable expertise in various sectors such as forestry, tourism and manufacturing.

After 25 years of this approach based on developing the capacities of each region, we must now consolidate our activity and build a solid economic framework. Through its centres of responsibility, FORD-Q will strive to develop the economic potential that already exists in the regions, supporting them in their efforts to move into new markets as part of the new economy. Our new approach will aim above all to help SMEs take advantage of new business opportunities, particularly in the fields of innovation, research and development and design.

Also underlying our new approach is the idea that, more systematically than in the past, our centres of responsibility will have to target their action in a federal perspective, in areas where FORD-Q can make a contribution that is original and complementary, for instance access to federal public procurement and access to the scientific and technical networks of the federal government such as the NRCC and the Canadian Space Agency.

As part of the second component of the repositioning of FORD-Q, our department will become an information hub and help SMEs get in touch with federal departments that offer strategic services with added value.

In a world where success depends largely on access to information, we will help small business leaders to obtain ready answers to their questions.

[English]

I have to tell you, Mr. Chairman, that it's quite fascinating. I can hear the translator. It's quite interesting; I'm making a very good speech.

[Translation]

For the benefit of these leaders, FORD-Q will draw on the treasure trove of information that is already available within federal departments and agencies.

One of the principle means of attaining this objective will be the development of strategic partnerships with other departments. For example, under a memorandum of understanding signed with the Department of Foreign Affairs and International Trade and with Industry Canada, the Federal Office has become a member of a team of federal experts in export assistance.

As part of this federal team, we will be able to make its export services available to SMEs in all the regions of Quebec. And we will extend this role to other economic spheres, notably the environment and agriculture.

[English]

Third, many people think of us as just one of the many organizations that provide financial assistance. Our new programs are based on an entirely new approach. They will broaden the range of services and assistance we offer our clients, and therefore financial assistance will no longer constitute FORD-Q's only product.

[Translation]

This new view of our role and our programs will not be complete if it is not accompanied by a corresponding transformation in the nature of clients relations. The traditional relationship based on assessing entitlement to financial assistance will be replaced with a more personalized and committed approach with a focus on providing information and services required by our clients.

.1540

I would like to say a few words on the financial aspect of the department. The budgetary rationalization measures adopted by the government applied to all federal departments and FORD-Q is no exception. It too has a part to play in our fight against the deficit.

The strategic course we have charted will allow FORD-Q to absorb these budget reductions while continuing to provide SMEs with the strategic services they need.

Access to investment capital remains an object of concern to SMEs, since the lack of such capital is so often an obstacle to their development. To remedy this problem, we decided to facilitate their access to capital while respecting the department's new fiscal framework.

In keeping with one of the measures I announced in the budget, FORD-Q is currently developing a strategic partnership with the Federal Business Development Bank as part of a pilot project to assist the funding of Quebec SMEs. The object is to create a special fund, which will have a leverage affect, in order to support projects undertaken by SMEs in unexploited niches.

At the present time, there are still a few stages to go through before the negotiations can be concluded, but I can assure you that this innovative process is progressing at a pace that is more than satisfactory and should be successfully completed as quickly as possible.

[English]

Going from the drawing-board to implementation is a huge step. I do want to say that the work of repositioning FORD-Q is well under way. Indeed, the officials who are with me deserve great credit.

Our new strategy addresses two realities. First is the necessity to target small and medium-sized businesses and their needs for strategic information. Second is the importance of making those services available in every region of Quebec.

[Translation]

As a result of this process FORD-Q will no longer merely manage programs but it will play an active part in stimulating economic activity. To guide its efforts more effectively, FORD-Q has a new tool which perfectly sums up its SME-centred approach - IDEA-SME.

It is important to note that as of April 1 of this year, IDEA-SME is FORD-Q's sole program and as such it will take over from its 40 or so former programs.

The acronym IDEA-SME refers to FORD-Q's four spheres of action geared specifically to SMEs: I stands for innovation, D for development, E for entrepreneurship and A for access to markets.

IDEA-SME is based on a new programming framework which emphasizes service delivery and addresses the economic realities of the 1990s.

We consider IDEA-SME to be the best possible tool for supporting SMEs which, I remind you, are generating new jobs for the economy here.

In conclusion, I would like to read you my department's new mission statement, which reflects the profound changes that have occurred within the Federal Office of Regional Development over the past year. The statement sets out the principles that will guide our action over the coming years.

The statement reads as follows:

I'd like to thank you for your attention.

[English]

The Chairman: Thank you, Mr. Minister. Before I ask our colleague from the Bloc to begin, I want to remind members we're dealing with the departmental outlook as well as votes 45 and 50 today. That's not on the agenda, and I wanted to make sure everybody understood that.

.1545

I want to remind members that the minister is prepared to answer questions on the departmental outlook, which I believe has already been circulated. This is his only appearance today for votes 45 and 50 and the departmental outlook. I just wanted that agreed.

[Translation]

Mr. Leroux (Richmond - Wolfe): Yes, we can deal with votes 45 and 50 in due time. We don't know how we're going to vote, but we will vote.

Thank you, Mr. Martin, for your presentation.

There is a very interesting dynamic in relation to Quebec. I'd like to make a comment at the outset, since you are the third minister to appear on regional development. You are not at all on the same wavelength as Mr. Dingwall, who is responsible for the Maritimes, and Mr. Axworthy, responsible for Western Canada.

When they're asked questions about cooperation with other departments, and about when they will be signing memoranda of understanding with other departments, they don't seem to be aware of any developments on that front. So the Quebec situation is rather special, if I understand correctly.

Anyway, following the death of ERDAs, since death can refer to passing from one stage to another, the agreements were not renewed, as you quite rightly pointed out. FORD-Q has embarked on a new direction.

In view of this new direction, how do you explain that fact that with the avowed intention of avoiding duplication and improving efficiency for SMEs, FORD-Q has reproduced a whole series of operations that already exist in Quebec for regional development, services offered by existing and recognized organizations? There's no denying that since the creation of MRCs, regional development in Quebec has been very dynamic.

Over the years there have been a number of important economic and social summits. There was the Picotte Reform, the exercise of redefining strategic plans region by region, the creation and maintenance of CRDs, the emergence of a great number of decentralized agencies in the 16 regions of Quebec where work is being done in all the areas described in the mission statement of FORD-Q.

I have here a table taken from something written by Daniel Allard, in the publication of the Association of the World Trade Center in Quebec City, which sets out all the programs found in the guide for export assistance programs - this would appear to be the focus of the new orientation, namely technology, exports and training.

This list contains nearly all the programs offered by regional structures in Quebec at the present time through the development plans of industrial commissioners or organizations such as MAIO. There will be 13 international commissioners providing a whole range of services that have been offered since the 1980s such as counselling for SMEs, strategic plans, expert studies, market expansion, development, support, funding, etc.

It's hard for me to understand how a new orientation for the Federal Office for Regional Development can be justified by a withdrawal from ERDAs because there is no longer any funding. Whole areas of regional development in tourism, cultural activities etc. have been abandoned. You know say that you're going to become experts or consultants for businesses, but such services are already provided by existing structures in Quebec. This is just a case of duplication.

A close analysis of the whole matter leads me to the conclusion that the difference lies in the federal claim.

.1550

What we are talking about are international markets through the 125 embassies. That is the source of information.

I can't understand why we would have 13 federal development offices, 250 public servants and an operating budget of $25 million to manage a databank. And when we look at the program, we wonder why an administrative structure...

[English]

The Chairman: I know you have a lot of comments to make, but could we get to some questions? We're here for the questions.

[Translation]

Mr. Leroux: If one wants to understand the questions, Mr. Chairman, what regional development is has to be explained. Strange to say, it's done differently in Quebec, witness the fact that the federal government is taking a different approach for regional development in Quebec in both its structures and procedures.

[English]

The Chairman: We all understand that. We're here to pose questions to the minister. He's here to answer questions. I encourage you to use your time to pose questions to the minister.

[Translation]

Mr. Leroux: I'll continue with my explanation of the question I intend to put on duplication and the fact that it will persist.

You talk about increasing business opportunities for SMEs in all regions. It so happens that such functions are carried out by Quebec agencies such as the Business Assistance Fund and the PAE which provides seed money to 300 businesses and a chance to set up a regional dynamic. And when we talk about regions, let's get one thing clear, Mr. Martin: in Quebec, we don't have 13 regions, but 16.

What do we call development in Quebec? You know the answer, because you are from Quebec. It is the coexistence in the same setting of health, education, municipal structures and all the structures that contribute to the development of life, it's not just SMEs but all these structures contributing to the development of life. That's what we call a region, regional development, a strategic development plan. It's not just something for the growth of a particular sector of economic activity.

FORD is proposing market development. In Quebec we already have APEX where 15 export commissioners do a type of follow through work on the international market with strategic and marketing plans; they provide expertise, do market analyses etc.

You say you'll be creating a climate to encourage entrepreneurship and business. The fact that such a climate has been in existence in Quebec for years is due to the many collaborative efforts that have taken place since 1985. The SDI is one of the prime factors in this favourable climate for business and entrepreneurship along with SDR, the regional development secretariat. There's a whole army of people working on this with the appropriate alignment of strategic planning.

As for innovations in research and development, there is the emergence of the Innovatech firms as well as SME Innovation, MIS, tax credits for research and development that are deductible as well as tax credits for design, reference to which was made earlier. Growth is taking place in Quebec.

There is significant overlap. Let me conclude with reference to the harmonization of different interventions and the appeal you made to your colleagues. We already have production assistance, SDI equity loans, the decentralized job creation fund, the FDCE along with a number of other funds that will soon be in operation.

[English]

The Chairman: Mr. Leroux, please. I've listened patiently. You're using up time.

[Translation]

Mr. Leroux: It's important.

[English]

The Chairman: Unfortunately, you have not been able to ask a question. I'm not sure I heard a question.

[Translation]

Mr. Leroux: Why is there this duplication when all the studies and strategic plans have been done in Quebec? There is no added value and in any case the strategic plans have been done and you have decided to carry out the same analyses, region by region, for Quebec. You've spend tens of thousands of dollars.

I haven't finished my demonstration.

[English]

The Chairman: Your time is up.

[Translation]

Mr. Leroux: You've done the same work but these people have come to look for the data here.

.1555

[English]

The Chairman: Mr. Minister, if you'd like to answer any one of those questions.... Mr. Leroux's time is up, so you can give him an answer if you feel it's appropriate.

[Translation]

Mr. Martin: Thank you.

[English]

I'll be as brief as I can.

[Translation]

First of all, I must say I greatly appreciate your drawing attention to our plans. It's a pity you weren't allowed to distribute them because they are our profiles. Not only are they our profiles, but the others you referred to also come from us.

Mr. Leroux: It's the other way around, Mr. Martin. You did them afterwards.

Mr. Martin: If there's any duplication, I can assure you that we are not responsible for it.

As far as the ERDAs go, we are quite willing to sign. We are quite anxious to start negotiations. As I said yesterday, the ball is in the provincial government's court. I know that they have other fish to fry, but we are certainly ready. Once they're willing to come to the table, we'll be there too.

Secondly, you made reference to duplication. With respect to the federal government network, as is the case for our embassies, only the Federal Office is able to carry out research and development. I want to stress that there is absolutely no duplication. The delivery arm of the federal government, the economic interventions relating to the great majority of our departments and the data they possess, come from the Federal Office. There is no duplication.

Mr. Leroux: There is a $25 million operating budget.

Mr. Martin: Thirdly, Mr. Leroux, I want to stress that the repositioning of FORD as well as its role were established in cooperation with local stakeholders. The matter was under discussion for a year and I myself met the business community in most of the regions of Quebec as part of this discussion. The proposals we are presenting here reflect their preferences.

If there is duplication, it is not necessary. But the question remains, why do the majority of the business community and SMEs in the regions want us to play this role? The answer is quite clear, they know perfectly well that FORD is able to provide them better service than any other organization, not only on matters relating to the federal government but also with respect to international prospects, research and development and, of course, relations with other organizations such as the FBDB.

Mr. Leroux: In all the regions, Mr. Martin...

[English]

The Chairman: I'm sorry, Mr. Leroux.

[Translation]

Mr. Leroux: Can we not finish?

[English]

The Chairman: Mr. Breitkreuz, you're next on my list.

Mr. Breitkreuz (Yellowhead): Thank you, Mr. Chairman. The way my colleague was going on, for a while I was thinking we might not get even one question in.

Mr. Minister, we have an idea of what's currently happening with FORD-Q, the expenditures, what the programs are, the budget. But I'm interested more in future projections and what the plan is, where we're going with this particular economic regional development program. We know, of course, that the infrastructure program has been rolled into FORD-Q as well and is being administered by it. We know that review program cuts are going on as well. I'd like to know what FORD-Q's budget will be after the third year of these program cuts.

Mr. Martin: The amount of free money we will have available in 1995-96 is $19.5 million; in 1996-97, $34.9 million; and in 1997-98, $27.7 million.

Mr. Breitkreuz: Those are the total expenditures -

Mr. Martin: No, that's the amount of free money we will have. The total expenditures - this includes infrastructure - are $487.5 million, $271.2 million, and $142.9 million.

Mr. Breitkreuz: That will be for FORD-Q.

Mr. Martin: That will be for FORD-Q, but that includes the infrastructure money.

Mr. Breitkreuz: So will the infrastructure program basically take over the role of FORD-Q now?

.1600

Mr. Martin: No. FORD-Q basically had its own programs. Those programs were, as with the other regional agencies, cut substantially in the recent budget. I tried to talk to the Minister of Finance, but I couldn't get him to.... He wouldn't listen.

Some hon. members: Oh, oh!

Mr. Martin: What we do is administer the infrastructure spending in the province of Quebec. That's why it's included in there. It really is quite a separate program.

Mr. Schmidt (Okanagan Centre): I'd like to follow that up with a question. Does this mean that instead of the infrastructure money.... Actually, you're moving from $47 million to $147.9 million. Is that correct?

Mr. Martin: From $47 million to $142.9 million.

Mr. Schmidt: $142 million. My apologies. What is happening in the other departments, such as the Department of Industry, the Department of Natural Resources and so on? They have certain programs too. Does this mean the money has shifted out of FORD-Q and is going to these other departments?

Mr. Martin: No. An understanding was signed with the Department of Industry last year in which money was shifted out and they accepted the responsibility for dealing with larger Canadian companies operating within Quebec, primarily in the area of manufacturing and some research and development, because we were concentrating on small and medium-sized businesses. That was the only one. The others all have their separate budgets, but we may well deliver for them. The moneys you have here, for instance...there is no EnerCan money there.

Mr. Schmidt: Then this is a distinct shift from the 1995-96 estimates. In the 1995-96 estimates you show, at least according to this particular document I have here, that you have administered for Industry Canada some $17 million dollars for tourism, you have administered for Natural Resources Canada...you have some $39 million; and for -

Mr. Martin: Those are agreements. That is not part of our funding.

Mr. Schmidt: I see.

Mr. Martin: We administer for other people.

Mr. Schmidt: I thought they administered for you.

Mr. Martin: No.

Mr. Schmidt: Well, that's what it says here. So this document isn't correct.

Mr. Martin: It says they administer for us?

Mr. Schmidt: It says ``administered by''.

Mr. Martin: I'm sorry. We did transfer certain responsibilities to other departments.

Mr. Schmidt: So these moneys were transferred from FORD-Q to Natural Resources or to Forestry or to Industry in these amounts, and they are then administering those for you. Does that mean that money is now shown in those respective departments, or is that money still shown as part of the FORD-Q expenditure?

Mr. Martin: Theirs.

Mr. Schmidt: Then I'd like to ask a question specifically about tourism. Under the FORD-Q program you show some $27.4 million in supply development for the tourism industry. Under Industry, we show tourism industry for market development, studies and services, $17 million. This suggests there is a total expenditure in the tourist area in Quebec of pretty close to $50 million, but it's divided - a little better than half of it under FORD-Q and the other part under Industry.

Mr. Robert Bourgeois (Assistant Deputy Minister, Operations, Federal Office of Regional Development-Québec): Yes. We administer a tourism agreement jointly with Industry Canada. There are three components to it, of which FORD-Q has responsibility for the first component, which is basically incentives to business. Two other components administered by Industry Canada would appear on their books, primarily to support international promotion of tourism products and studies. So it would be those two areas that together make up the total tourism agreement.

Mr. Mills (Broadview - Greenwood): Minister, under your statutory items here I notice you have liabilities under the Small Businesses Loans Act of $48 million. Could you or your officials tell me whether that number has been projected or is a fixed number? Is that a hard number or a provision?

.1605

Mr. Hugues Lacombe (Former Assistant Deputy Minister, Corporate Services, Federal Office of Regional Development-Québec): It is a provision. That number is produced by the Department of Finance. The SBLA program is in fact managed out of Finance, but because the actual loan activity is occurring throughout the country, the loan-loss provisions are attributed to each of the regional agencies and to Industry Canada for Ontario. So while the regional agencies don't manage these funds, Finance puts these numbers in our part III's for that purpose.

Mr. Mills: But it's strictly a provision.

Mr. Lacombe: Yes.

Mr. Mills: That's fair enough, because it's really twice what it was last year and I wonder....

Mr. Lacombe: It is a provision.

Mr. Mills: Okay, fair enough.

Minister, this leads to my next question. As the minister responsible for regional development for Quebec, you know - and you've stated this publicly before - that one of the greatest difficulties small business has is access to capital. You've supported this committee in the work we've been doing to try to move financial institutions to rethink their attitudes. We acknowledge, of course, the support you've given us on the FBDB.

I need to hear from you, not just as the minister responsible for regional development in Quebec, but also as the Minister of Finance. What specific actions are you taking to make sure that the nerve we all need to press on financial institutions continues to be pressed? With all these other programs and services you're offering - they're all positive and constructive - we all know, as members of Parliament, that the greatest complaint we're getting is that even today, with all the work we've done, the banks still aren't providing the access to capital that they should be.

The Chairman: I'm not sure I should allow that question, but go ahead.

Mr. Mills: Well, it's a regional question.

Mr. Martin: The first thing I should say to you, Chairman, in response to Mr. Mills' question - and in fact this is a substantial part of the answer to Mr. Mills' question - is in regard to the activities of this committee. I don't think anybody should underestimate the effect this committee has had not only on public awareness in terms of the need to provide capital to small and medium-sized business, but in fact the seriousness of the government in doing so.

When the Minister of Finance in his budget essentially stated that the government really wanted to see benchmarking, this committee very quickly picked up on that and basically said.... Let's be very honest - neither we nor the bank has a specific set of criteria for benchmarking. We're basically looking upon this committee to come up with it. The fact is, I think there was a giant step forward.

So to answer your question, as the minister for regional development within Quebec, the problem is very, very serious. The problem exists obviously - and I'm not going to speak about Quebec - within Montreal, either the southwest or the east end of Montreal, areas that have very high levels of poverty, where small business is really the only form of business that's going to get going. The problem is very great.

The problem is equally serious in the regions. I can tell you that the preparedness of financial institutions to not provide loan capacity in some of the farther away regions of Quebec is the same as it is in other parts of the country. When you're a regional development minister, it is a very important thing. That is one of the things I hope this committee will deal with.

If you were to ask me as Minister of Finance if I wanted to have to legislate, the answer is clearly no. Would I like to see the benchmarking set up? Would I like to basically see this function on the basis of financial institutions assuming their responsibilities? Yes, if we have to, we will. But if we can stay away from that, if you continue your efforts, then I think we would do it.

However, I would then almost return the question to Mr. Mills and to you, Chairman, in terms of this committee. The one thing we consistently hear is that the problem isn't that the banks won't lend; it's that small business doesn't have the equity capital, and that's not the bank's role. As the regional development minister, I would be very interested in the reaction of this committee as you continue to talk to people about whether there is, in fact, a shortage of equity capital, and whether that is the fundamental problem we should be dealing with.

Mr. Mills: Do I have a little more time?

The Chairman: Sure.

.1610

Mr. Mills: Mr. Minister, on April 4 the Canadian Finance and Leasing Association made a presentation to the Senate banking, trade and commerce committee, in which they talked about all these non-deposit-based institutions. They had all kinds of ideas for trying to access this market, not only because it was good business for them, but also because they felt it was a way of providing some opportunity for competition with the basic banks of Canada. I ask you to ask your officials to take a close look at the ideas those other non-deposit-based institutions are coming up with to see if we can include them in the mix in some way to try to meet this problem we're all trying to conquer.

Mr. Martin: I saw the testimony, Mr. Mills. I think the Minister of Finance did ask his officials to look at this and come back to him. It has not come back yet. I did not, as minister for FORD-Q, ask the officials to look at whether this in fact could be an additional arrow in the quiver. It's a very good suggestion and I'll do that.

[Translation]

Mr. Rocheleau (Trois-Rivières): Good morning, Mr. Martin. First of all, I would like to somewhat follow in the footsteps of my colleague and comment on certain passages of your presentation with respect to duplication. You know that this is a concern that is always the focal point of the debate.

You said that your consultations were rather sympton-oriented and that they were limited, as you mentioned in your statement, to companies and that the government of Quebec, which, at the very least, is the co-promoter of economic development, does not appear to have been consulted. You said that the issue of networking was listed as one of the concerns. I would like to draw your attention to the fact that networking is currently one of the areas where the Quebec Department of Industry, Trade and Technology is playing a role. If ever you decided to get involved in this area, we would have a good example of duplication, and Mr. Caron could probably confirm this.

I would like to refer you to page 5 of your document where you talk about the Federal Business Development Bank. You stated that a strategic partnership had been worked out or was just about to be worked out with the Federal Business Development Bank to cover underdeveloped market niches. When you read the act amending the mandate of he Federal Business Development Bank, you can see that, according to section 20, the Bank can sign agreements with federal or provincial departments or agencies or any other organization or individual and act as its agent for the delivery of services, etc.

Given the close cooperation that appears to exist between the FORD and the FBDB, I'm wondering whether or not you considered the Law on the Department of the Executive Council of the Government of Quebec. The Government of Quebec exists and it is a legitimately elected government. I'm wondering whether you considered section 3.11 which says, more or less, that any organization, school board, MRC, urban or regional community, etc., must first of all obtain permission before it can negotiate or sign an agreement with a government in Canada or any department or agency of that government. Did you concern yourself with this type of issue?

Mr. Renaud Caron (Assistant Deputy Minister, Federal Office of Regional Development-(Québec): When you talk about the Executive Council, what law are you referring to?

Mr. Martin: I will let my officials respond. But first of all, as far as the issue of the government of Quebec is concerned...

Mr. Leroux: You are not aware of this law?

Mr. Martin: You are telling me that we did not discuss these issues with the government of Quebec. We did hold discussions with that government. I certainly held discussions with the previous government of Quebec. I think that, after the election, Mr. Chevrette, my counterpart, was one of the first people with whom I met. We discussed several things during our meeting, including the ERDA. I would like to tell you very clearly that Mr. Chevrette did not ask the federal government to withdraw from regional development. Moreover, Mr. Chevrette clearly indicated his desire to renegotiate an agreement between the federal and provincial governments. I think that it's almost the opposite of what you are now telling us.

.1615

Secondly, I would like to point out, both to you and to your colleagues from the Bloc Québécois, that the questions that you raise in the House are never about us withdrawing from regional development. You are always asking: ``Why don't you do such and such?'' Your message is somewhat contradictory.

As for your question, I think that Mr. Manley gave you an answer. I'm very happy that he answered your first question yesterday because I didn't understand it. However, I would now like to ask Mr. Caron and my colleagues to provide you with an answer.

Mr. Caron: Earlier, you referred to duplication. One of the aspects we considered when developing our policy was, in fact, Quebec policy on regional development, which advocates, as one of its underlying principles, that the regions should assume responsibility for their own affairs. We took all of this into consideration.

Secondly, as regards duplication with the Department of Industry and Trade, Innovatech asks us on a regular basis, every week, to assist with the added-value aspect of their product, since we, as the federal government, are able to provide this technological development service. This company makes this request every week.

I can give you an example. In the Eastern Townships, last week, as part of our new program, an agreement was signed with the Quebec Department of Industry and Trade, the Quebec Department of International Affairs and Immigration, the Federal Office, the CRDs, the regional CRD, five MRCs of the Eastern Townships and all of the economic development corporations. Every group brought something special to the table to support export development in the Eastern Townships.

None of these stakeholders questioned any group's participation. We contributed by allowing the others to use 800 trade delegates that we have abroad and to use our strategic information. We agreed to join these people, at their request. Last week, we all signed an agreement.

Mr. Rocheleau: My question is not complicated. In fulfilling your duties, do you, as a Quebecker, consider the roles of both the Government of Quebec, which is responsible for promoting regional development, and the Government of Canada, or do you try to disregard Quebec?

Mr. Martin: No, not at all, quite the opposite.

Mr. Rocheleau: Mr. Martin, section 20 of the Federal Business Development Bank Act reads as follows:

No reference is made to the Government of Quebec as such without there being a prior agreement on the type of contact that the federal government may have with government-created bodies.

[English]

The Chairman: I'm going to jump in here as chair and try to sort this out. In New Brunswick we have different kinds of rules. We have ACOA. I want to say that the FBDB question to the minister is not relevant.

[Translation]

Mr. Rocheleau: Mr. Chairman, the minister is the one who spoke about a special agreement between the Federal Business Development Bank and the FORD, on page 5 of his document. We fully understand what this entails. This is why I am asking this question.

Mr. Martin: First of all, you are telling me that an agreement reached between two federal organizations is subject to provincial agreement.

Mr. Rocheleau: No, no.

Mr. Martin: But that is what your question is about.

Mr. Rocheleau: No, no.

Mr. Martin: That was your first question. Secondly, every time that we reach an agreement with a provincial agency, we try to obtain a variation order from the provincial government. Therefore, I have a great deal of...

Mr. Rocheleau: That's it. You're going to say that you would be willing to give us $500,000 if Quebec did as much. That is what you're going to say.

[English]

The Chairman: We're out of time. Do you have a quick response?

[Translation]

Mr. Caron: Mr. Rocheleau, we always comply with the act you mentioned. We have no choice but to do so. Every time we have dealings with the Government of Quebec or a municipal agency, we must have an order from the Government of Quebec supporting our actions. Each and every time!

[English]

The Chairman: Thank you. Mr. Rocheleau, you've never been this animated before. You just woke up.

[Translation]

Mr. Rocheleau: I have reason for doing so.

[English]

The Chairman: What's the reason? It must be spring or summer.

Mr. McClelland.

.1620

Mr. McClelland (Edmonton Southwest): Thank you, Mr. Chairman. I'd like to deal with the outlook document initially. My comments about the document are in general terms.

First of all, I was very disappointed to receive this document. In comparison with other outlook documents that other departments have provided, this is very shallow. I don't think it serves the purpose outlook documents are supposed to serve. It has no spreadsheets and no comparative numbers, which is the reason for my first question. If the departmental outlook document is to provide this committee with the kind of information we want and need, then we should have that in advance and be able to look at it.

I bring that to your attention, Mr. Minister, because I know that if you were presented with a document such as this you would be as offended, as I and perhaps other members of the committee were by this document. I would particularly bring it to compare with that of Western Economic Diversification.

Secondly, we have to do the comparing we can with the departmental outlook. Given that we can't make any changes to what we have today, we must look at how we deal with the future, particularly in view of the budget constraints we are all familiar with.

Western Economic Diversification is going from expenditures of $173 million net of infrastructure this year to $9 million two years from now. It would appear that FORD-Q is going from expenditures next year of $271 million net of infrastructure to $142 million. So it's about a 50% reduction. Could you tell me why Western Economic Diversification is going from $171 million in expenditures to $9 million - this is contributions - and FORD-Q is not? Why would all the cuts not be parallel?

Mr. Martin: In fact, the cuts are. Let me just say two things.

First of all, your comment that you were not provided with spreadsheets is well taken, and you should have been. It's no answer to provide them to you now. I apologize for that, but we will give them to you now.

The fact is, and perhaps Mr. Lacombe wants to speak on this, the cuts applied to all agencies were done on a comparable basis. I can't speak for WEDO, but I can speak for FORD-Q. The best example I can give you in terms of free money, money that has not been committed to, is that we will end up in 1997-98 with $27 million.

Mr. McClelland: Mr. Minister, what percentage of today's budget of $487 million is contribution, what is grants, and what would be repayable?

Mr. Martin: While they're looking up the numbers, at the present time, compared to WEDO, very little of it is repayable. WEDO got into the repayable business substantially ahead of FORD-Q. We've only gotten into it recently. So in terms of expenditures already committed, a very small percentage of that would in fact be repayable.

Mr. McClelland: Then in two years' time, in 1997-98, what percentage would be repayable?

Mr. Bourgeois: We have a policy to try to wrap up to a situation where 75% of the total portfolio is repayable. We've taken into account that some of our contributions are going to be made to not-for-profit organizations that in a significant way support the strategic orientation of the department. By definition we can't structure repayable contributions, but we've limited those contributions to the not-for-profit sector to about 15% to 20%.

.1625

So we're targeting to try to have at least three-quarters of the whole department's contribution base repayable. That will start kicking in more significantly, in terms of payback to the government, in years four and five. But that's beyond the financial tables we're speaking of here today.

Mr. McClelland: So we're going from - I'll guess, because we don't know - let's say 5% this year that's repayable to 75% two years hence.

Mr. Bourgeois: Yes. In fact, as of today all contributions to for-profit organizations of over $25,000 will be repayable.

Mr. McClelland: May I ask why there is the limit of over $25,000? Why would it not be a rule that all contributions are repayable?

Mr. Bourgeois: We examined that question. If you look at the nature of the programming, the very small projects tend to be for studies and things of that nature. For all intents and purposes you're looking at providing seed money to move into a development phase. Once a company gets into a project where they're actually coming back to the government for more significant projects, we kick in a recovery or a repayable. The policy we now have sets the threshold at $25,000 for a repayable contribution.

Mr. McClelland: This may not be the appropriate time to ask this question, but it would seem to me that if a venture is successful, then the venture should repay the money regardless of what the initial contribution is. What difference does it make whether it's above $25,000 or below $25,000? If the venture is able to repay, it should repay.

We are going to be getting more involved in this as other witnesses appear - for instance, with the FBDB - and don't respond to that. I would leave that for now.

The Chairman: Your time is up.

Mr. McClelland: The time is up and there's no way you can answer that anyway.

Mr. Martin: I understand what you're saying. The concept, as Mr. Bourgeois has pointed out, is that a number of the contributions under $25,000 are essentially made where there's a study required, which may or may not point to something that's going to succeed. Obviously if development of an export market, or whatever the reason for the study, does not result in success, then the people will not pay it back. As I understand it, you accept that. You're going on to say, however, that if the project does develop and does become profitable, why shouldn't you pay it back?

Mr. McClelland: Exactly.

Mr. Martin: That's a valid point and I don't think we would dispute it. What I think Mr. Bourgeois is saying is that the vast majority of those are either going to be done for those initiating studies or.... The other thing that often happens is that in a lot of the regions outside Montreal or in the poorer sections, these may well be initiating studies to bring groups of people together to develop a market. What you're really doing is the vertical and horizontal integration of many companies coming together for one project, and we're the principal catalyst.

The Chairman: I'm going to jump in here and invite Ms Bethel to ask some questions.

Ms Bethel (Edmonton East): Mr. Minister, it's really a good initiative you have in the change in direction of FORD-Q. I think it's the way of the future. However, I'd ask two questions.

First, how do you ensure that with these new initiatives in client service there won't be duplication and overlap with what's already being done by the province?

Mr. Martin: The answer to your question is that we're very conscious of that. What you see when you read the report is that we have focused on one of two things. On the one hand are those areas where only the federal government can provide the services or has the skill or the information. Therefore by definition there clearly could be no duplication. On the other hand are areas where there has been overwhelming pressure from the local community that we act.

.1630

I have to say that based on the consultations we have done and the discussions with the business communities in those areas, there has been that kind of support and pressure.

Ms Bethel: The other question relates to performance standards. How do you intend to measure these programs? In your outlook document you've talked about strengthening your commitment to your clients and setting a system of service quality standards. I noticed there was no mention of how you measure the other programs.

Mr. Martin: That really depends again on the individual programs. If I understand your question correctly, within manufacturing, for example, the Canadian Manufacturers' Association itself has a set of quality standards that it uses.

Ms Bethel: No. How do you measure the programs? Are they effective? Are they cost-effective? Are they efficient? Are they doing what they are supposed to do?

Mr. Martin: Let me answer that in a slightly broader way. It is a very important question. In 18 months of government - and again I have to look to the industry committee - if there is one thing I have learned it is that governments at all levels really do not evaluate their programs properly. They consistently wake up far too long after the fact to suddenly discover that things have gone wrong.

My own view is that your question should not only apply to FORD-Q, but it should also basically involve all government spending. I guess the only way I can say it is that you have to do it on a timely basis. You simply cannot allow too much dust to gather under your feet before you act. Therefore, we will be monitoring each of these programs very quickly, looking for results and looking for the benchmarks they've been established against.

Ms Bethel: Has FORD-Q identified any key growth areas?

Mr. Martin: We essentially said the newer economy - either innovation design, which is obviously very important in the Montreal area.... Those export areas are rising out of our natural resources, environmental technologies. Essentially it would be the basic strengths of any individual region and the relationship of those strengths to their export capacity.

Ms Bethel: Industry Canada is focusing on results and has developed a guide to performance measurement. When we asked them if they measure the productivity or success of the agencies they oversee, they said no. I'm asking if you have developed a guide to performance measurement for FORD-Q, and whether we could ask for it next time you come before us.

Mr. Martin: Yes, we have developed one. As to whether we're satisfied with it, the honest answer is that we'll probably let you know in a couple of years when we've seen how the whole thing works out.

Ms Bethel: Two years? We only have [Inaudible - Editor]

Mr. Martin: All right then, we'll come back here later.

The Chairman: Mr. Bélanger, please.

[Translation]

Mr. Bélanger (Ottawa - Vanier): Mr. Minister, is tourism among those industries that FORD-Q tries to promote?

Mr. Martin: Yes.

Mr. Bélanger: I want to ask you a question straight out. If the Government of Quebec were to request from FORD-Q some help to convince the federal government of the rationale of Expo 2005, how would the FORD-Q and the minister respond?

Mr. Martin: I am looking at Ms Bethel.

[English]

Ms Bethel: Yes. And I didn't ask that question, I want you all to know.

[Translation]

Mr. Bélanger: You could ask any question you wanted, Madam.

Mr. Martin: Obviously FORD-Q would certainly support the province of Quebec's initiatives.

Mr. Bélanger: To date, has the Government of Quebec contacted the office in this regard.

Mr. Martin: Not as far as I know.

Mr. Bélanger: Thank you.

Mr. Martin: I can check with my colleagues.

Mr. Bélanger: I am waiting for your answer.

[English]

The Chairman: Mr. Mills, my guess is you're going to have a short last question.

Mr. Mills: I have a short question, Minister. I want to go back to my opening question on the provision that has been put in your document for liabilities under the Small Businesses Loans Act. This concerns me because it's approximately twice as much as last year. I realize the float is a lot larger, but I've heard from many financial institutions that the Small Businesses Loans Act is working very well and that the default rate is down considerably.

.1635

Two things concern me about this provision. First of all, I hope the banks aren't dumping some of their weaker loans into the Small Businesses Loans Act portfolio. Second, I think it is going to give the Small Businesses Loans Act a bad name if all of a sudden we're having 100% increases in our loan-loss provision - and it's only a provision. It might cause people to start backing away from that very important catalyst that helps some of those smaller organizations get going when they're on the borderline, in terms of taking risks.

Is there some way you could show me, with a fair amount of detail, how you arrived at that amount in terms of a provision?

Mr. Martin: As you know, there has been a tremendous explosion in Small Businesses Loans Act loans. The answer may well arise out of that increase. Mr. Lacombe has just said that the size of the provision is not FORD-Q's decision; it's Finance's. If Finance were here, it would tell you it's the Auditor General's. This is something that should not be applied just to FORD-Q. The provision should be applied right across all the government's accounts. But that doesn't mean your question isn't valid.

Mr. Mills: If all of a sudden it's not $48 million but half of that, your FORD-Q budget would look a hell of a lot better. You might become a little more active in supporting that particular act.

Mr. Martin: We'll talk to Finance.

Mr. Mills: Thank you. If you can find them.

The Chairman: Colleagues, I'm just watching our time because we have a vote called for 5:15 p.m. Mr. Minister, could you give us a few more minutes?

Mr. Martin: I can give you at the outside ten minutes and then I will really have to go.

Mr. Breitkreuz: We're interested in understanding how these regional development programs operate and are administered and so on. We know that the minister for ACOA has stated they're getting out of the direct contributions and grants end of their program, as is WED, hence its reduced budget to $9 million in two years. FORD-Q obviously is not.

Mr. Martin: That's absolutely wrong. We are getting out of the business. We're going to repayables. There should be no doubt about that.

Mr. Breitkreuz: Over what kind of timeframe?

Mr. Martin: As Mr. Bourgeois said, I think we're there. We are not now providing grants as in the past. Everything is now repayable. We're there. The only reason for delay is that in our numbers, loans may have been granted in previous years that are still in the process of being furnished. But we're out of it, and we've been out of it for some time.

Mr. Breitkreuz: I just wanted to make that clear Mr. Chairman. Thank you.

Mr. Schmidt: I want to follow up on that previous series of questions, Mr. Minister. By the way, I want to thank you for the straightforwardness of your answers so far.

My question has to do with tourism, supply and marketing between the Department of Industry and FORD-Q. You have $27 million, I think, under FORD-Q and about $70 million in your department. How does this relate to the Canadian tourist commission that has just been set up? How does that fit in with all of this? Your total budget here is almost the equivalent of the whole CTC.

Mr. Martin: As I mentioned earlier, there were three components to that tourism agreement. The first component was basically to handle incentives or contributions to projects.

Mr. Schmidt: You're talking about this program here?

Mr. Martin: That is now exhausted; there are no more funds left.

Mr. Schmidt: So that $27 million disappears?

Mr. Martin: The portion of the $27 million that related to that first component disappears. The components that are now left in the tourism agreement are under the authority of Industry Canada, and the officials who sit on the federal-provincial agreement are part of the Canadian Tourism Council. There's a link, to that extent. So in a sense Industry Canada officials who were administering tourism have now been transferred to the Canadian agency.

.1640

Mr. Schmidt: I appreciate that. Do I understand correctly then, Mr. Minister, that $27.4 million out of 1995-96 will just disappear now? Or will there still be a component that FORD-Q does on tourism?

Mr. Bourgeois: Yes.

Mr. Schmidt: There will always be a part?

Mr. Bourgeois: Under our baseline programming, which the minister indicated, we will have a provision to support tourism projects. However, the only funds left under the federal-provincial agreement, which has been in place for several years and which expires in 1997, will be administered by Industry Canada. Those components are specifically to support international promotion of tourism and studies. Our department will still be in the tourism business under our main-line programming.

The Chairman: Mr. Leroux, I'm going to allow you a very short question.

[Translation]

Mr. Leroux: On what was said earlier about the legislation on the executive council, regional development in Quebec is in the hands of agencies that come under the Quebec Government. Regional municipalities, school boards, cegeps, universities, health boards, etc., they are all creatures of the Quebec Government.

Mr. Caron, you mentioned earlier the exclusion order. Don't you think that by specifying in the bill that the minister can directly conclude agreements with all sorts of organizations of that kind - as is specified also in the legislation restructuring the Department of Industry, which can also directly conclude agreements - , it creates a situation where pressure might be put on policy-makers for a great number of exclusion orders, and that might spawn off new parallel organizations?

Mr. Martin: Not at all. It is out of the question. Overlap and duplication are of great concern to us. We want to eliminate them as much as possible. The business people in Quebec want us to continue to play a role. We do want to sign an agreement with Quebec. We want to do it in order to eliminate duplication. The ball is now in the provincial government's court. As soon as they are ready, we will meet with them in order to get rid of those problems you have mentioned.

[English]

The Chairman: Thank you, Minister. Officials, thank you very much. We appreciate your being here today.

Mr. Martin: Thank you, Mr. Chairman.

FINANCE

Vote 45 - Operating expenditures $23,419,000

Vote 50 - Grants and contributions $397,987,000

Votes 45 and 50 agreed to on division

The Chairman: Shall I report these votes to the House?

Some hon. members: Agreed.

The Chairman: I guess I'll have to present this report tomorrow, because we don't have it.

Tomorrow the subject-matter of Bill C-91 will be coming to our committee, if it leaves where it's supposed to leave tonight. If so, Minister Manley will be appearing tomorrow at 3:30 p.m. for the Federal Business Development Bank.

Also, if you have specific witnesses other than the ones being proposed, I wish you'd contact our researcher so he will be able to have those witnesses contacted.

I'm also advised that Santosh is going to be withdrawing from this committee for a period of time. I'd like to introduce you to George Etoka, our new clerk at the industry committee for the moment.

Are there any procedural questions?

Mr. Schmidt: My procedural question has to do with the report on the CTC. You have a sixth report that was circulated as a draft and confidential.

The Chairman: Right.

Mr. Schmidt: How is that going to be handled?

The Chairman: The purpose of my circulating it to you was that I had a chance to have a very quick look at it. I asked our researcher to prepare it and circulate it for review and comment. If you have comments, concerns or issues, I'd appreciate your dealing directly with the researcher. If we don't hear from anybody, then I'll be asking for it to be put into a final form.

.1645

As you can tell, it's a very short report. If it's your pleasure that we deal with it in a larger committee focus, I'm happy to consider that, but I haven't heard any large concerns about it yet.

Mr. Schmidt: Should I raise my concern with you as chairman of the committee or with the researcher?

The Chairman: I think it would be more helpful to deal with the researcher. He can deal with you on an individual basis if there are some specific issues relating to that.

An hon. member: Could we get a list of witnesses who have been invited?

The Chairman: The preliminary list prepared from some time ago is the minister and his officials, and officials from the Federal Business Development Bank, the Canadian Bankers Association, the Canadian Federation of Independent Business, the Trust Companies Association of Canada, the Canadian Finance and Leasing Association, Fédération des caisses populaires, and Credit Union Central of Canada.

That's the list. The list is eight witnesses, so it's a fairly short list. We're not sure whether any of those witnesses are even going to respond, so it could be a very quick turn-around.

On behalf of the committee, and obviously on behalf of the minister, who's advised us of an urgency to the bill - and I think we've respected his interest in trying to respond to him as quickly as we can by holding tomorrow's meeting - if there are some issues that any members of this committee wish to bring forward, I would appreciate it if they would please contact either me, George or Terry.

Tentatively, in terms of planning your schedules, colleagues, we would try to have an early Thursday meeting. It would be a morning meeting for an hour to an hour and a half, to perhaps deal with FBDB.

Mr. McClelland: If in the odd circumstance we may suggest amendments, will we be able to suggest these amendments verbally in committee?

The Chairman: I think your colleagues would prefer to have amendments or suggestions written.

I'm reminding you that this bill is being referred to us after first reading, which gives us reasonable flexibility. In other words, we're not as constrained as with a bill coming after second reading. Now, some people have been less than happy with that process, but I think it's a little more relaxed in terms of the rules and I would appreciate it if we could try to keep that relaxed atmosphere.

The only question I would throw back to you is, having had the experience of at least Bill C-43, you must remember and respect the fact that when the bill comes back it is effectively a redrafted bill coming back from our committee. It's almost in stone when it comes back to the committee, so the negotiation effectively occurs in committee. In other words, there's no second or third wave here. I'm reminding you of that just to get ready for the mind-set.

With Bill C-43 there was lots of discussion and there were loads of in camera meetings in which to bat things around. We had a good understanding of where everybody was. Then the posturing occurred. I'm trying to avoid the posturing that sometimes goes on with all sides.

Mr. Schmidt: Mr. Chairman, I hope you can carry that forward. That's a good idea.

Mr. McClelland: Then we will have the opportunity to go into clause-by-clause after the witnesses.

The Chairman: Yes.

Mr. McClelland: If we know we're going to make substantive changes, then we'll have those in writing.

The Chairman: I think that's -

Mr. McClelland: Others would be on the floor.

The Chairman: The chair is going to be flexible. Just for your interest, Mr. McClelland, I've already been advised by some Liberal colleagues that there are some things on this bill they have questions about. For example, the name of the bank itself is an obvious question that has come forward already. I might as well throw it on the table so that everybody understands it may become an issue.

Mr. McClelland: It is an issue.

Mr. Schmidt: It is an issue.

The Chairman: I think it is an issue, because obviously our committee had recommended something different.

.1650

In terms of preserving the chair, if there are some interests, I would ask you to deal with colleagues informally so that we avoid time.

The House leaders have obviously spoken. The government office has already spoken to the Bloc and to Reform about certain kinds of agreements there may be. FBDB is very high on everyone's list because of a very practical problem, that being that limits run out in July. We had already talked about this prior to that.

I would respectfully ask colleagues that you keep your schedules flexible so that we can get at least one more meeting this week - I've requested it for Thursday. The following week we would conclude. We would then have a draft report available by the end of next week if there are amendments, and it could come back to the House for a report on June 12 or June 13.

An hon. member: [Inaudible - Editor]

The Chairman: I'm just telling you that this is what the House leader advised. I have not spoken to the minister, but I've spoken with the House leader.

Mr. Schmidt: I hope we can carry it off, but by the same token I don't think -

The Chairman: I'm not rushing this, you know.

Mr. Schmidt: No, that's good, and I appreciate that very much.

The Chairman: I'm just laying out my schedule because it's our schedule. That's what I'm trying to put on the table.

Mr. Schmidt: I understand that.

[Translation]

Mr. Rocheleau: If we wanted to invite other witnesses, besides the eight you mentioned earlier - could you repeat their names, please - when would we invite them for?

[English]

The Chairman: We need to know who they are immediately.

[Translation]

Mr. Rocheleau: The witnesses' names?

[English]

The Chairman: But there has to be a cut-off. In other words, I can't let witnesses get dragged in. We are all agreeing to a set of witnesses -

[Translation]

Mr. Rocheleau: What would the deadline be?

[English]

The Chairman: The deadline for hearing witnesses would be -

Mr. Leroux: July 1.

Some hon. members: Oh, oh!

The Chairman: No. I don't want to set deadlines. If we have a legitimate person who has a contribution to make, we as a committee will make the decision.

You know, Mr. Rocheleau, that you may be ruled out of order; you may put a witness forward and it may not be acceptable. Equally, one of the Liberal colleagues may do the same, or the Reform may do the same.

Mr. McClelland: Mr. Chairman, I would like to ask that we consider inviting the Canadian Imperial Bank of Commerce, the Royal Bank of Canada, and/or any other bank specifically. I know the CFIB and the Bank of Montreal have departments working specifically in areas that may be overlapped by the new FBDB, so rather than discuss this with the Canadian Bankers Association, I think it would be of value to our committee to discuss some of these things with the bank itself.

The Chairman: On that specific point, Mr. McClelland, I have not heard from anybody in the minister's office whether or not they have anyone interested in this subject. Like you, I read about the amendments to the FBDB in the newspaper. I would say that presumably if there are banks out there wishing to make interventions before our committee, they would have the opportunity. They would contact the clerk.

An hon. member: If they know we're holding hearings.

Mr. McClelland: They have to know and they have to be invited. You already have their list. Why can't we send them a letter?

The Chairman: I understand that we've talked to the Canadian Bankers Association and that they've advised.... The researcher has spoken to the Canadian Bankers Association. About a week ago they advised the respective banks that hearings were likely and that the likely dates were going to be in the next few days. We haven't heard from anybody. Because of time, I can't write a letter and get a letter back. The researcher will therefore contact CBA, if that's agreeable to all of us -

Mr. McClelland: Mr. Chairman, I've been in conversation with the Canadian Imperial Bank of Commerce about this. Today was the first they had heard about it. We're talking about putting a -

The Chairman: No, that's not possible.

Mr. McClelland: Well, this was the first time the person I was talking to today had heard that this was going to happen.

The Chairman: Okay, that's possible; it's a big bank.

Mr. McClelland: Because of the importance to the banking industry, I would again ask that we formally ask the banks if they would care to appear. That has to come under your signature. It can't come from me.

The Chairman: Are there any other views on Mr. McClelland's point? Mr. Mitchell.

Mr. Mitchell (Parry Sound - Muskoka): I agree with it.

.1655

The Chairman: Mr. Bélanger, did you want to comment on this?

[Translation]

Mr. Bélanger: No, Mr. Chairman.

[English]

The Chairman: Okay. We have one meeting going on.

I want to say that we agree, then.... Mr. McClelland?

Mr. McClelland: Under your signature.

The Chairman: I don't know if it's going to be a signature or a phone call.

Mr. McClelland: Or a phone call, but under your -

The Chairman: Under the authority of the chair, we'll ask the researcher to contact the Royal Bank and the CIBC specifically.

Mr. McClelland: And the Bank of Montreal.

The Chairman: And the Bank of Montreal. Those are your three. Do we all agree to that?

Mr. McClelland: If anybody else wants to suggest others, go ahead.

Mr. Discepola (Vaudreuil): I don't see what those banks are going to add to the debate. We have the Canadian Bankers Association. They certainly represent -

The Chairman: We're going to sort it out.

Mr. Discepola: It's up to you, but you may get all six of them wanting to come.

The Chairman: I know, and that's the difficulty. But as long as you leave the chair some prerogative to try to sort it out, I can avoid turning this into another hearing on benchmarks. As you know, the banks can drag things on as well.

The researcher hears what you're saying. I think he heard what Mr. Mitchell said. We will come back to you with a response.

Mr. McClelland: Thank you.

The Chairman: The meeting is adjourned.

;