Mr. Speaker, I thank the member for for sharing his time with me today. He is a leader not only in Abbotsford but within the Conservative caucus. I appreciate the effort he has put in today and every day.
It is a pleasure to speak today in support of Bill , the fairness at the pumps act.
I am proud to stand before members as my government takes decisive action to protect Canadians from inaccurate measurements at the gas pumps and other measuring transactions across the country. We pledged in our 2008 election campaign to expedite the issue of measurement inaccuracies, and today we take an important step toward making good on that promise.
The Weights and Measures Act has for many years set the measurement rules for the purchase and sale of products that Canadians enjoy every day and the Electricity and Gas Inspection Act sets rules for the purchase and sale of electricity and natural gas, critical commodities for sustaining our Canadian way of life.
Bill , the fairness at the pumps act, would amend those two pieces of legislation to protect Canadian consumers and retailers from inaccurate measurements. The bill is just one more instance of the 's energetic commitment to ensure fairness in all business practices across the country.
Bill may strike some of my hon. colleagues as a housekeeping law, but I can assure them that it represents far more than that. When measurement inaccuracies occur, whether deliberate or inadvertent, they represent a great potential liability for Canadians. The fairness at the pumps act attacks this critical and compelling consumer issue by increasing the onus on retailers to take charge of their measurement practices and ensure all customers get a fair reading of their product purchases.
The act would accomplish this by imposing fines on non-compliant businesses and by calling for mandatory inspection frequencies. This means that businesses would be required to have their measurement equipment inspected by a third party every one to five years, depending on the industry. If the equipment does not operate accurately, the business must have it repaired.
I refer to this consumer issue as critical and compelling because it has been top of mind with Canadians since 2008 when the news media reported on how very often gas pumps inaccurately measured the fuel they were dispensing. Canadians also learned from those news stories that the consumer was the loser in three out of five instances of incorrectly measured fuel.
Understandably, Canadians have become increasingly concerned about whether they are getting their money's worth at the pump. They wonder if they are being overcharged because they have no means of judging for themselves the accuracy of the neighbouring gas pump in question. It is a situation that is completely unacceptable, which is why the and his predecessor have followed such a decisive course of action in developing this bill.
Despite the bill's name, the fairness at the pumps act, it extends well beyond gasoline retailers. It calls for inspections in other sectors, including downstream petroleum, dairy, retail food, fishing, logging, grain and field crops, and mining. My government may add additional sectors to this list in the future according to the needs of Canadians.
One great strength of Bill is that it has been carefully crafted to anticipate a wide range of offences, from the relatively minor to the serious. The fairness at the pumps act would ensure not only that retailers have their measurement scales inspected frequently enough to guarantee accuracy in nearly all cases, but it would also impose stiff penalties on retailers who fail to comply.
As my hon. colleagues know, some people will only make the effort to comply if there is a criminal charge to be had, only if circumstances are dire. By raising the fine of non-compliance from $1,000 to $10,000 for minor offences, from $5,000 to $25,000 for more serious offences and up to $50,000 for repeat offenders, the is sending a strong signal to gas pump operators and retailers across this country: comply or pay.
Canadians are tired of being victimized by lax measurement standards. This new legislation would protect them from that. At the same time, Bill offers a means of penalizing offenders without actually prosecuting them as criminals.
Although the bill calls for swift punishment when necessary, it also recognizes that some measurement offences are relatively minor and inadvertent. As such, Bill offers what we have called a graduated enforcement approach, which means the penalty can fit the offence.
Canadians believe in appropriate justice and this legislation reflects that ethos. Indeed the fairness at the pumps act approaches the very issue of enforcement in the spirit of fairness and constructive encouragement rather than casting all offenders as hardened criminals.
Not only does Bill protect consumers and make allowances for minor offenders, it is also a boon to small business operators who will act as government appointed inspectors under the legislation. One of the media's principle criticisms of Measurement Canada's performance in 2008 was the organization's lack of capacity to protect consumer interests. My government has addressed this issue by requiring businesses to manage their own inspection schedules in compliance with this new legislation.
The fairness at the pumps act calls for the use of private sector operators as authorized service providers. These businesses would conduct inspections under the Weights and Measures Act on behalf of the government and charge for their services according to supply and demand.
Rather than imposing a top-down government-driven inspection regime, Industry Canada will train small businesses to undertake this important work. It will evaluate them every year to ensure they are doing the job correctly and then trust them to carry out their job with accuracy and integrity. If they violate that trust, Industry Canada may revoke their authority.
Will Bill put undue strain on small business operators required to comply? My government believes it does not. There will be minor additional costs for small businesses, but the conveniences inherent in the new system may well offset those costs.
For example, authorized service providers, the inspectors who the will designate, could also service and repair measurement devices as they perform their inspections. In this way, small businesses will find that they can kill two birds with one store and keep their equipment working at an optimally at all times.
Gas and food prices continue to be a concern of all Canadians. With these price pressures comes a great responsibility to ensure that the quality of the product is near perfection. No purchased good can approach perfection if its weight or volume has been calculated incorrectly.
This reality rings especially true for the single mother who is feeding her family on a shoestring budget, for the small business landscaper whose company has to pay onerous gasoline bills to reach rural customers and for working parents who have to heat their home with increasingly expensive natural gas through a bitter prairie winter.
I call on my hon. colleagues to recognize that on the issue of measurement standards, these Canadians cannot afford anything less than the protections in Bill . If retailers fail to comply with the perfectly reasonable stipulations of the fairness at the pumps act, they must be made to pay.
Mr. Speaker, I thank my hon. colleagues who have preceded me on the debate. I apologize I was not able to be here at the outset, so the parliamentary secretary and I did not have a chance to exchange a few ideas, but I am sure his colleagues will take it to him. I also want to thank our industry critic from Montreal.
I greet today, with some degree of trepidation, this legislation. Although much vaunted as being the panacea for all consumers in Canada, it is in fact significantly short on substance, short on proof and short on the deliverables. This seems to be one of the few things that could have been done, which would be, in some respects, a no brainer.
However, there are much more important issues dealing with the price of fuel and energy that should concern Parliament and the government. However, we need to consider the heat of the moment. An election campaign was triggered by the , who went back on his own word. In one evening gas prices went up 12.9¢ per litre. Most Canadians know that because this member and this party pointed out that the industry had become so monopolistic in the downstream that what took place was nothing short of tragic. The Americans had a major hurricane shut down refinery alley along the Texas Gulf coast. They witnessed a 6¢ a gallon increase at the most. I know that because I spoke to Ali Velshi, a senior correspondent at CNN, to get my information. In Canada it was 60¢ a gallon, converted to 12.9¢ to 13¢ a litre.
If that does not address the fundamental concern about just how clued out we are when it comes to the price of gasoline and energy costs, then I need ask members to look no further than the context in which that legislation was proposed two years ago. It took the government two years to finally come up with something and it said it would probably deal with one in twenty-five gas pumps which it thought was faulty, that it would call them pumps and that the likelihood was they had been tampered with. The minister referred to them as chisellers.
I can not think of an example that demonstrates such ignorance from a minister who obviously does not know anything about a gas tank, let alone how to pump it. Perhaps he spends a little too much time here with his driver and does not pump his own gas so he does not recognize that there can be mechanical failures.
The hon. member for talked about his experience working at a gas station. No doubt he will be familiar with the former 25, 30 year old equipment, which is used in many parts of the country that is not served by a number of gas stations. Very small communities may be using old electronics and very old equipment. It is very difficult to compromise and to break the electronic sequence that is in those pumps. What often happens, if there is an error, and that is assuming the error does not in fact benefit the consumer, is the product breaks down as a result of wear and tear.
That is why I asked the hon. member a very pointed question and I will ask the experts. In some communities pumps are not used as much. The introduction of ethanol could have an impact. Where we have higher use, there is a probability of breakdown. It is not someone's fault. That is the result of wear and tear on machines, and no machine is guaranteed to go forever, especially if it goes through sustained high use.
I am sure we will hear from Dresser Wayne, or Gilbarco, or Oppenheimer, which has been taken over by Dresser Wayne. We will hear from those individuals who work in the industry and who will pinpoint the shortcomings of their fuel.
Suffice it to say, my website, tomorrowsgaspricetoday.com, receives 30,000 or more hits a day. Out of those are generated hundreds of emails. I probably receive more emails on this subject than any member in the House combined, especially when the prices go up or when they go down and we see the fluctuation which is out of sync with world pricing.
I am concerned because this legislation is a distraction. It is a façade. It can be dealt with by regulation if indeed there is the presence of a problem. The minister has admitted that only 6% of pumps were found to be faulty. Of that 6%, 4% of the 100% that were done, did not favour the consumer.
If we are to prepare ourselves to embark on an idea of working to fix these problems, I want the committee, and I certainly want Parliament and the public listening right now, when we come to fairness at the pumps, there is a suggestion that there has been unfairness at the pumps. I can say with some certainty, it would be almost impossible for independent retailers or agents, as the previous member talked about, to trigger a mechanism that might make those pumps not work. It is very difficult to do.
More important, if we look at the way a pump is made and the way retailers take inventory, to skew the numbers to try to play games for a couple of days would only hurt their inventory. They would get a call saying, “You've used this much. How come you have this much left?” Unless, of course, there is a leak or a problem with the tank, in which case there might be some environmental concerns.
However, what it does not do is address the fundamental concern that I have, and I think many colleagues in this House should have, about where there is in fact a disconnect between consumer value for what they purchase and what in fact they get.
I can say with some certainty, with years of working on this file, that the last problem we have is accuracy in the pumps. If it were such a big issue, we would have had more than one conviction over the past three or four years. I am not saying it does not happen, but I am certainly convinced it is not because people are deliberately fixing the pumps. First, as I just mentioned, it is difficult to do. Second, it skews the inventory to such an extent that it becomes a self-defeating exercise. If they in fact do these things, they are only hurting themselves.
I received two emails this morning that dealt with a far more credible issue that the government could have addressed and may fall into the very same category that we had when we were in government. I note that the hon. member for and some of his colleagues said our government did very little about it. I want to encourage the members of the government to recognize not to make the same mistakes of fooling themselves into the belief that somehow what they provided here is a panacea. In fact, it is very much a tinkering, a glossing around the edges of a very serious problem.
By that I mean the following. In every region in this country today, every community has the identical wholesale price, and I see that the rack price is out as of just a few minutes ago. I cannot think of a more vivid example of the lack of competition than when we see the exact same price in any community across Canada. I will be glad to show members, for the purposes of their edification. If I look today, for instance, I will see that the rack price is identical everywhere in Ottawa. Everyone will charge the same thing tomorrow. It will be somewhere in the vicinity of 60.8¢ a litre; Quebec's will be 61.4¢; Montreal's will be 61.4¢; Toronto's will be 62¢. The hon. member for will happy to know his will be 66.8¢. The point is that the price is determined by one player. No one challenges that price at the retail level nor at the wholesale level. And so, what Canadians are faced with tonight is a 2¢-a-litre increase. That is above world prices as established at the NYMEX just 25 minutes ago.
So when members talk about a skew in a pump of 1% on 80 litres, which would be the average fill-up of most cars in my community, that is .8¢.
How about the 2¢ ripoff that is going to happen tonight?
Let us deal with some real issues in this House for once and not go around contenting ourselves with some idea that we have a better widget than the people who preceded us or than the ones who preceded them. The reality is far more serious.
I know that members on the industry committee should have the benefit of all the questions, not just Measurement Canada, but to look beyond this first step. I am hoping it is a first step, because members will recall that, in the 2008 campaign, the Conservative Party pledged to deal with the issue of potential problems at the gas pumps, which I might point out came from an Ottawa Citizen article during the 2008 election. That Ottawa Citizen article seems not to have a lot of people backing it. Certainly people at Measurement Canada have not verified it. So, it is interesting that we have erected today two years of investigation based on an article for which no one really wants to take credit. More important, why should they?
When the CBC national news runs with a story saying 75% of all pumps are skewed, what a great horror. Every pump we are using now, almost every one is going to rip us off.
Let us try to infuse some facts into a debate on something that is important to Canadians. For every penny they save at the pumps every given week, that could mean hundreds for a family at the end of the year.
As members will know, if someone can get away with having a monopoly in the gasoline industry, one might be able to have the same or near monopoly in the propane industry or the natural gas industry.
I will not get into the issue of arbitrage because that is not for the debate today. However, it is important for us to understand another ripoff, which the government fails to understand.
How is it possible that a wholesale price of 60¢ a litre for regular versus mid-grade at 62.3¢, which is a 3.25¢ difference, or premium, which is always 5¢ above regular, translates into a 13.5¢ ripoff?
Someone has to have a lot of control and a lot of power to be able to move prices from a wholesale differential of 3¢ to 13¢. I want hon. members in the House to understand that we are dealing now with not one penny or one-eighth of a penny or 1% when it comes to premium, when it comes to mid-grade, which many vehicles must run on, or when it comes to diesel. We are dealing with a wholesale margin translated to the retail level that could be in excess of 8¢ to 10¢ a litre. Then multiply that by 50.
I can guarantee that, when we look at those kinds of numbers, it is very clear that the government has either tried to distract the public with this legislation, a bit of smoke and mirrors, a bit of a smokescreen, or it just does not want to address the fundamental problem that exists with this industry, as it may with others.
I am not saying there is not a desire to change. Members know that I have built part of my career on trying to deal with this, but I am very suspicious of the context of this legislation. It is a quick fix aimed at the wrong people, which gives false hope that somehow people are going to see better prices at the pumps come this summer.
Let us be honest. Summer driving season is coming up. Although demand for fuel across North America is low and supply is very high, we now see prices heading north for no reason. If we had competition that would not be the case.
Every week the Americans provide what is called the weekly petroleum status report. Since 1979 the Americans have ensured that every drop of energy that they produce, that they use, that they anticipate using for inputs and refineries, is accounted for.
I see three citations in this document, which gives transparency to the Americans and to the world as to what the price should be every Wednesday morning at 10:30. I see three footnotes here from Natural Resources Canada. We supply the Americans with data to help them get a better understanding of the world, to protect consumers and to ensure transparency, but we will not do it for Canadians. Why?
There was an attempt to do this in 2006. The member for talked about what he did in 2006 during the election. Wonderful. We had a little proposal that said we would replicate the exact same thing, a weekly petroleum report, through something called the office of petroleum monitoring. We would give Canadians a better and more accurate understanding of how much is produced in this country, including the stock market, the commodities market. Why would we want to fly blind? The rest of the world wants to know how much they are producing. That makes sense. But no, the first act of the Conservative government was to kill the petroleum price monitoring system. I still have not received an answer.
Some anecdotal discussions with people in the industry, the downstream, have told me that it was really the folks at Imperial Oil who did not like it. Esso did not like it because it did not like it. That is funny; Imperial Oil's parent Exxon Mobil in the United States has been required by law since 1979 to furnish all data on supply and demand. It just makes sense.
I would have thought that the government might have actually dealt with that particular issue, but it did not. It chose instead to go to defective pumps and translate that and torque it somehow into greedy little retailers conspiring in the dark of night to wreck their pumps to make sure Canadians do not receive full value for that which they have worked so hard to obtain.
It is important for us to recognize quite a few things that have not come forward yet.
The margins and the racks that Canadians are forced to pay are substantially higher than those around the world. This means that the infrastructure in which so much taxpayers' money has been invested over the years, to build a pipeline to serve the entire country, energy self-sufficiency being one of the goals, has now been translated into virtually a network, a system, an infrastructure that is controlled by a handful.
I come from Toronto, and my region used to have three or four refiners. How many do we have today? None. Half the supply in my riding comes from Montreal because of the number seven line that was produced to push petroleum from the west to the east to create energy self-sufficiency.
My colleagues from the Bloc and all hon. members of the House are well aware that another refinery is closing. I told them that would happen in November. The declining number of refineries is worrisome. In 2007, a report indicated that the small number of refineries in Canada would create a supply problem. Even before the Petro-Canada and Sunoco merger and the proposed closure of the refinery in Montreal, regulatory officials were concerned.
To put this in proper context, if Canada is in a tight supply situation and, even though there is plenty of crude going around, we cannot produce enough, it puts us at a strategic disadvantage not only for our ability to ship abroad but, more importantly, to make sure premium prices are not charged to Canadians because we do not have enough refinery capacity in this country.
It is important for the government to recognize this. It can pay lip service to the idea that fixing the pumps is going to somehow prevent prices from going up unduly. Frankly, that is hollow. It is irrelevant and untrue.
I can say with some certainty that, if we do not deal with the issue of supply in this country, we are going to wind up as truckers did in western Canada. Yes, western Canada. I am speaking of Saskatchewan, Mr. Speaker, your very region. Truckers were scrambling for supply because of the way in which crude can be bent or configured and the way in which refineries are made. Some emphasize gasoline and some emphasize diesel.
It is very clear to me that we cannot afford a repeat of what happened in 2008. It seems to me that the first responsibility of any government is to ensure adequacy of supply, regardless of what party it is. It failed. It utterly failed, and it is important for the government to clue into that as well.
I will come to my last concern. I want to devote the last three minutes remaining to something far more serious, which Parliament appears not willing to understand, much less address. The government, in particular, must understand this in the context of the comments by the and I am sure it must concern the . That is the speculative and changing nature of our markets.
Ten years ago it was acceptable to see NYMEX, the New York Mercantile Exchange, as being the way in which prices were derived. A producer or consumer would go in and trade, and on a 30-day or 60-day basis, act on the deal, sell a bit of oil and take delivery of the oil. That has all changed.
With the growth of Goldman Sachs Commodity Index, AIG, Lehman Brothers, Bear Stearns, Morgan Stanley and over-the-counter derivatives, traders right here in Canada, in Winnipeg, through the Intercontinental Exchange, we have seen massive distortions in the price of fuel, which hurt industry, retailers and refiners. Bringing the price of crude up to $147 and then dropping it to $35 is in no one's interest. Yet it happened.
Whereas that happened two years ago, what happened just last Thursday? I know some are wanting to say there are fat fingers and someone made an error and put million or billion. The way in which trades take place today is that there are high-frequency traders on computers who, if they see something drop 1%, will suddenly sell everything they have. The market then closes and many companies are left in ruin.
We have a golden opportunity at the G20 and G8 next month to lead the charge to regulatory reform, which is at the heart of the cost of energy for Canadians and the price they pay for gasoline. I know what I am talking about on this subject. The Obama administration is trying to tackle this, and I think Canada can play a leading role at precisely the right time to signal to the rest of the world that we want real people consuming and producing. We do not want index investors or sovereign investors, people who go in high, bid, hold the product at a certain price and create volatility in the market, which destroys the market.
I call on the government to look a lot further than the nano or micro step it has taken with respect to regulation of gasoline pumps. Look at the bigger picture, stand up for constituents, hear what I have said and measure it against what we have seen around the world today. Stand up for Canadians and I think Parliament will have their support.
Mr. Speaker, I wish to thank the House for giving me this opportunity to voice my support for the fairness at the pumps act, an act that upholds the integrity of many Canadian industries, an act that boosts consumer confidence and promotes competition in the marketplace, and an act that honours the promise my hon. colleagues and I made to Canadians when we formed this government.
I urge members of the House to recall that promise now, to remember the events of two years ago. At that time, gas prices were rising steadily across the country. With each passing month Canadians were pressed to dig deeper into their pockets to drive their children to school, commute to work, and to purchase consumer goods transported long distances to local stores. By spring, the cost of fuel was reaching historic highs.
That is when the news hit. Some retailers were capitalizing on the hardships of Canadians fraudulently. Media outlets covered the story recalling that as a result of inaccurate measurements at the pump, many people paid for fuel they never received. Canadians cried foul and rightly so. The fundamental rights of consumers had been violated. The vital trust between buyers and sellers had been broken. The time-honoured principles that formed the very basis of this country's market economy had been dishonoured.
The Government of Canada took action immediately. We vowed then and there to amend the Electricity and Gas Inspection Act and the Weights and Measures Act. We vowed to ensure that people across the country receive what they pay for at the pumps. We vowed to protect consumers in all trade sectors that depend on accurate measurements of goods.
We made a promise in 2009. Today, we keep that promise. We keep that promise through the introduction of the fairness at the pumps act, a piece of legislation that holds retailers accountable to buyers for the volume of product sold, that enshrines consumers' rights to know what and exactly how much they buy of any product, and that promotes fairness, honesty and decency. These are the values all Canadians cherish.
I am sure many members of the House agree with me. Such legislation is vitally necessary, but will Bill be effective? Will Bill C-14 accomplish the goals to which it aspires? Will Bill C-14 prevent fraud in the retail petrol sector? These are valid questions.
Too many well-intended laws lack the robustness needed to bring about real change. The Electricity and Gas Inspection Act and the Weights and Measures Act are proof enough. By virtue of these laws it has long been a criminal offence to cheat the measurement of goods and services and so deceive consumers. Still, many retailers fail to follow the letter of the law.
In 2006-07 Measurement Canada made it a priority to get to the bottom of the issue. Indeed, the special operating agency declared its resolve to address the problem of measurement inaccuracy in eight trade sectors, including the retail petroleum sector in Industry Canada's 2006-07 report on plans and priorities.
Since then, Measurement Canada has consulted extensively with industry leaders, small business owners and with members of the public. In each discussion one truth continually resurfaced. One truth that now provides the rationale for the specific amendments to the Electricity and Gas Inspection Act and the Weights and Measures Act presented in the fairness at the pumps act.
There are two types of non-compliant retailers. There are retailers who mislead consumers inadvertently and much more seriously, there are retailers who cheat consumers maliciously.
Let me speak first of all to those who mislead consumers inadvertently. By and large, these are honest retailers. These are decent, otherwise dependable men and women who through ignorance or negligence fail to monitor and maintain the accuracy of their equipment.
At present, the only means to punish even minor contraventions to the Electricity and Gas Inspection Act and the Weights and Measures Act is in the courts. Prosecution, however, is not always the most appropriate means to penalize careless retailers. After all, these are not necessarily felons. These are not people whose actions are so monstrous as to warrant a lifelong criminal record. These are people who should be warned, who should be disciplined, and who should be taught to be accountable for the distribution of their products and services.
For those retailers the solution is simple: more frequent inspections. Under the fairness at the pumps act, businesses would be required to have the accuracy of their gas pumps or other measurement equipment validated and certified regularly by the authorized service providers trained to meet Measurement Canada's performance criteria. Retailers found to be non-compliant with consumer laws would face monetary penalties in line with the severity of their offence.
What about retailers who cheat consumers maliciously? What about the second type of non-compliant retailer who knowingly undermines the accuracy of his or her devices so as to profit at the expense of others? Periodic audits of measurement accuracy are not enough to protect Canadians from such racketeers. Strong enforcement mechanisms are necessary.
Here is where the existing legislation falls flat. At present, the maximum fine for non-compliance is $5,000. A minor offence runs retailers a mere $1,000. The penalties are a pittance compared to the money dishonourable retailers stand to gain. Make no mistake. Tampering with the accuracy of measurements is not a crime of passion or revenge. It is not a crime of hatred or a crime of fear. It is a crime of greed. Money is always the motive. Therefore, let money also be the deterrent. Let criminal behaviour be made less lucrative. Let criminal behaviour be made less compelling.
The fairness at the pumps act would increase court-imposed fines up to tenfold and would add new administrative monetary penalties. Retailers who commit minor transgressions would pay for their non-compliance with a fine of $10,000. Retailers who are more conniving, unscrupulous and deceptive would face fines of up to $25,000 and could find themselves before a judge. Retailers who are found to measure fuel or other goods inaccurately more than once would risk a $50,000 and legal prosecution.
In this way, the fairness at the pumps act would provide what existing legislation lacks: a strong arm to enforce the law and deter criminal behaviour before it starts. For this reason, I am confident that Bill is not merely a mouthpiece for consumers. Bill is a champion of consumer rights, with the backbone to defend the interests of Canadians at the gas pump and everywhere else consumer goods are sold on the basis of measurement across this country.
I urge my hon. colleagues to also defend the interests of Canadians. I urge my hon. colleagues to contemplate the merits of the fairness at the pumps act and pass Bill . Indeed, I urge my hon. colleagues to vote in favour of this act with as much conviction, as much determination and as much principle as Canadians did when they elected us as their representatives and entrusted us with the responsibility to protect the rights of consumers.
Mr. Speaker, I am pleased to rise today to speak about a subject that affects a number of citizens. Everyone has an opinion about the price of gasoline and how that price is calculated. In past years, some reports and newspaper articles shed a light on gas pumps that were not accurately measuring the quantity of gas at some retailers. Consumers were frustrated, especially since at the time, gas was even more expensive than it is now. Bill was introduced in response to these reports.
The Bloc Québécois believes that it is important to modernize the legislation to guarantee better consumer protection and to deter businesses that could profit from these inaccuracies. The government must act as quickly as possible. But first, I would like to outline the position of the Bloc Québécois before I talk about our concerns about this bill.
I would like to begin by saying that the Bloc agrees with the principle of Bill C-14. However, the bill does not respond directly to the issue of collusion, such as recently came to light in Quebec, nor does it effectively prevent sudden gas price increases.
This is an important issue for the Bloc Québécois and we believe that we must continue to try and respond effectively to gas price increases with Bill because Bill C-14, which we are talking about today, still does not allow the Competition Bureau to initiate an inquiry. It has to wait until it receives a complaint from an individual before launching an investigation. The Competition Bureau does not have the power to investigate if it has not received a complaint.
Although the Bloc Québécois agrees with the principle of Bill , the bill is not an end in itself. It does not deal with the major issue of apparent collusion in this industry. We believe that it is time to make amendments to the Electricity and Gas Inspection Act and the Weights and Measures Act.
First, any retailer that violated the Electricity and Gas Inspection Act would automatically receive a fine of up to $2,000. Inspectors who discover the violation would issue a ticket ordering the offender to pay the fine. The offender could then pay the fine or contest it within the timeframe and according to the terms of the ticket.
The defendant could present a due diligence defence, demonstrating that he had exercised due diligence in order to prevent the offence from being committed. Consequently, it would be up to the retailer to prove that he is not guilty, and there could be additional penalties if the retailer continues to operate in violation of the law.
However, the most important thing, I feel, is that the act would allow the names of offending businesses to be published. In an area such as gasoline sales, if a retailer were found guilty, there would be a serious impact. Word travels quickly in some neighbourhoods and since there are numerous gas stations, some businesses could lose customers. This measure would definitely force certain retailers to obey the new law.
Second, the amendment to the Weights and Measures Act will allow authorities to impose much stiffer fines on offenders.
Under the new provisions of this bill, government appointed inspectors will be authorized to enter the premises where they have reasonable grounds to believe that an infraction has been committed. They will be authorized to examine, seize and keep anything found there, use any computer or communication system found there and prepare documents based on that information. They can also restrict access to the premises and force the shutdown of defective equipment.
As is the case with the Electricity and Gas Inspection Act, a retailer who violates the law repeatedly over several days will face cumulative sentences for each of the days.
Bill also amends section 35 of the Weights and Measures Act to increase the penalties imposed on offenders. In the case of a first offence, a conviction will carry a maximum fine of $10,000 and/or up to six months of imprisonment.
In the case of an offence prosecuted by indictment, the maximum fine will be $25,000 and/or up to two years of imprisonment.
In cases of repeat offences, the maximum fine for an offence punishable on summary conviction will be $20,000, although the maximum prison time remains unchanged at six months.
If the offence is prosecuted on conviction on indictment, the maximum fine will be $50,000, still with the possibility of a maximum prison sentence of two years.
Lastly, a fine of $10,000, or $20,000 in cases of repeat offences, has been established for offences that are not already covered by the legislation.
Bill C-14 is not meant to frighten retailers, but simply to correct a piece of legislation that no longer meets current standards.
It is only natural that, in 2010, inspectors should be able to ensure that consumers are not being cheated. Consumers must receive the amount they pay for. They must get their money's worth.
All the same, we do have some concerns about the bill, and we intend to raise certain issues when this bill goes to committee for examination.
We believe that Bill C-14 could have included an amendment to the Competition Act. The government should use this bill as an opportunity to introduce additional measures to protect consumers.
I have been a member of the House of Commons since June 2004, and every time we have debated the price of gas and rising prices, the government, be it Liberal or Conservative, has always said the same thing: their hands are tied because the Competition Bureau found no evidence of price-fixing among oil companies. There was therefore no problem.
What we really need to grasp here is the fact that the Competition Act has some major loopholes. The Competition Bureau cannot launch an inquiry of its own accord. Inquiries can take place only at the minister's instigation or if a consumer, a legal entity or otherwise, files a complaint.
I know the government says that it implemented measures to fix the problem as part of the 2009 budget implementation act. However, these new provisions still do not enable the Competition Bureau to inquire of its own accord or to take this kind of initiative.
The inquiry process cannot be launched until a complaint is received. That is how it works right now.
In fact, that is why we believe that the Bloc Québécois' Bill is still needed. It would enable the Commissioner of the Competition Bureau to inquire into an industry sector if he or she deems it necessary to do so. As it stands, Bill C-14 does not address that issue.
Bill C-452 gives the Competition Bureau the power to take the initiative to carry out real inquiries into the industry if it has good reason to do so, which is not something it can do right now. It cannot act until it receives a complaint.
It goes without saying that if we pass such a bill, the Competition Bureau will be far better equipped to fight companies that seek to take advantage of market dominance to fleece consumers.
I hope that my colleagues of all political stripes in the House will tell us what they think of Bill C-452 and whether they agree with us about the Competition Act's shortcomings. As I said before, the current Competition Act does not allow the Competition Bureau to hold inquiries of its own accord. It cannot launch an inquiry unless it receives a complaint or is authorized to do so by the minister.
For years we have also been calling for a petroleum monitoring agency to closely monitor the price of gas and to address any attempt at collusion or unjustified price increases.
The Bloc Québécois is not alone in recommending changes. For years we have been repeating the recommendations of the Standing Committee on Industry, Science and Technology made in November 2003. The federal government has never done anything to help consumers and has a fine opportunity here to set up a system to monitor the petroleum industry.
In November 2003, the Standing Committee on Industry, Science and Technology strongly recommended the creation of an agency to monitor the oil sector. A committee would be asked to submit an annual report to Parliament on the competitive aspects. The creation of such an agency would enable the government and us as legislators to keep a close eye on the industry.
To the Bloc Québécois, there is no doubt that the Competition Bureau must have more freedom to act and more discretionary power over its inquiries. The Competition Bureau must have access to all documentation when conducting an inquiry. The Competition Bureau could then effectively play its role as an advocate for competition. When there is competition, the consumer pays a fair price.
Only if it is given more responsibility can the Competition Bureau undertake a real inquiry into the true nature of the activities of an industy sector.
Today we are no further ahead than we were seven years ago. Bill C-14 is a step in the right direction, but it is just the first step. For a long time now, the Bloc Québécois has been urging the government to take action to deal with the high prices of petroleum products. Bill C-452 is just the first step in fighting the high price of gas.
Bill C-452 aside, the Bloc Québécois is more convinced than ever that the industry must do its fair share. With skyrocketing energy prices and the oil industry's profits, the economy as a whole is suffering while the oil companies profit. We have to do away with the fat tax breaks the oil companies are getting.
One year after coming to power, in its 2007 economic statement, the Conservative government announced additional tax cuts for the oil companies, which will see their tax rate go down to 15% in 2012. Canadian oil companies will pocket nearly $3.6 billion in 2012 alone because of these tax breaks.
Third, we must reduce our dependence on oil. Quebec does not produce any oil, and every drop we consume makes Quebec poorer, in addition to contributing to global warming. The Bloc Québécois therefore proposes that we reduce our dependence on oil.
In 2009 alone, Quebec imported $9 billion worth of oil, less than usual because of the recession, but in 2008, oil imports totalled $17 billion, up $11 billion from 2003.
To reduce our dependence on oil, the Bloc has proposed substantial investments in alternative energy to create a green energy fund, launch a real initiative to reduce our consumption of oil for transportation, heating and industry, including an incentive to convert oil heating systems, and introduce a plan for electric cars.
We have to get ready, because by 2012, 11 auto manufacturers plan to introduce some 30 fully electric and hybrid models, more reliable cars with better energy efficiency and much lower operating costs than gas-powered cars.
I do not want to get away from the objectives of Bill , but for the Bloc Québécois, any discussion of oil consumption has to include a real plan and a structure for attaining these three goals.
In closing, I will briefly go over the three steps to a more effective law. First, we have to bring the industry in line by giving the Competition Act more teeth. Second, the industry has to pay its fair share of taxes, which means doing away with fat tax breaks. Third, we have to reduce our dependence on oil by, among other things, introducing incentives for consumers to buy electric vehicles.
Better ways to prevent fraud, as Bill is proposing, are needed, but we must introduce measures that will really benefit us in future, with a comprehensive action plan.
Madam Speaker, I am very grateful for the opportunity to speak to the government's Bill . What it is calling a fairness at the pumps act seems to me to have more to do with politics than real fairness.
I was particularly impressed with the long, detailed and interesting speech by the member for . He seems to have identified what I have identified, that this is mostly about what the current government has been very good at, very skilfully and successfully, quite often, at changing the channel on what the real issues are.
As I read between the lines, along with the hon. member for , this deals with a lot more than just pumps and a lot more than just fixing gas pumps with small errors in them. It would amend the Electricity and Gas Inspection Act and the Weights and Measures Act and would increase mandatory inspection of measuring devices in a whole host of industries like dairy, retail, food, fishing, logging, grain, field crops, mining, et cetera. However, the way it is being marketed and sold here is that it is supposedly about the petroleum sector.
There are about 125,000 gas pumps in Canada, with about 60,000 of them to be inspected every year for accuracy under this bill. Why does this come all so late? It was over two years ago that the Ottawa Citizen and our party in the House reported on investigations that showed government inspections found that about 5% of pumps delivered more or less fuel than reported in the pump display on pumps across Canada. In the 2008 election campaign, the Conservatives were emphatic in saying that they would take immediate action. That is two years of consumers getting hosed, on average, twice a year per consumer. The government has collected taxes on all those overcharged consumers during that time. Why did the government not act sooner?
One thing that is interesting about the bill is it would outsource inspections on all sorts of measuring devices, including gas pumps, to private companies and private inspectors. There would be about 400 to 900 private sector inspectors required to carry out the inspections of the pumps alone. This would add perhaps $2 million in costs for the taxpayers each year. There would be the question of oversight of all these private inspectors. What is to stop a company in the oil business from having its inspectors in this position in a biased position?
A lot of questions are left unanswered by the bill. One problem the bill tries to solve is that while occasionally the pumps give consumers extra gas they did not pay for, far more often they give them less gas than they paid for. That can hardly be coincidental. As a former scientist, the degree of difference here does not seem to be random or accidental.
The bill would increase fines for pump discrepancies to $10,000, or $25,000 for big offences, and would add new fines of $50,000 for repeat offenders.
However, the biggest problem is not inadequate fines right now. Getting caught with inaccurate pumps already results in fines. The problem is authorities do not have the investigative power to gather evidence to impose fines where they are needed in the first place, not with inaccurate pumps, but with the price of gas itself.
Gas station owners should have properly calibrated pumps, and in fact the vast majority do. However, targeting them with more frequent inspections and higher fines is missing the big mark. The bill would use them as scapegoats, and the government seems to be unwilling to tackle the real problem. The bigger problem is not faulty pumps. It is high gas prices and unconscionable margins and probably collusion and price-fixing, prices among competitors that mysteriously go up in lockstep with one another and prices that shoot up quite quickly when the price of oil rises, but never seem to fall very fast or very far when the price of oil drops.
The real problem is that once again we are changing the channel away from the real issues. My region of northwestern Ontario knows this all too well, perhaps better than almost anywhere in Canada. My office hears over and over again from people who feel they are getting hosed. I do not blame them. Over the last 48 hours, eight out of the top ten most expensive pump prices in Ontario were in northwestern Ontario and the other two were in northeastern Ontario. In fact, our gas is usually more than 20¢ a litre more than in most parts of Ontario or in Manitoba.
This weekend while gas prices were as low as 89¢ a litre in Ottawa and 95¢ in Toronto, they were $1.10 or more in Thunder Bay, $1.13 in Terrace Bay and $1.15 in Longlac, among some of the highest prices in Canada. It is outrageous and fines for faulty pumps will not fix this. The problem is not with the pumps and it is not with the small gas station owners either for the most part, who as I said, the vast majority are honest and have accurate pumps. Most do not make very good margins themselves. Most do not even set the prices. It is the big oil companies that set those prices.
If we want to help a minority of consumers getting cheated at faulty pumps twice a year, that is okay. However, what about helping the vast majority of Canadian consumers who are getting gouged every time we fill up on gas? There are lots of unanswered questions. Why are prices in some regions like northwestern Ontario 25% higher most of the time? Obviously, different provincial taxes and periodic problems with refinery supply and shipping play a role in gas prices. The freight cost of transporting gasoline to the northwest is often given as a reason as well, but other regions in Canada just as far away do not have a whopping 25% price difference. As Thunder Bay's the Chronicle Journal newspaper wrote on July 10 of last year when things were really out of hand:
||—the one definitive study into city gas prices...determined that prices here should be a maximum of only four cents a litre higher than the rest of Ontario.
What is needed is a public inquiry into price fixing in the gas market and industry oversight with real teeth. I know that when my colleagues in the NDP have called for public inquiries before, the government has suggested that consumers should take their concerns to the Competition Bureau. It knows full well that the Competition Bureau cannot do anything without a smoking gun. About the only time something really gets done is when an informant comes forward from inside the scheme, like we saw in the Quebec gas fixing cartel in 2008.
Virtually all the convictions from price fixing in the last two decades come from that one single case because someone on the inside came forward. In that case, the Competition Bureau commissioner at the time, Sheridan Scott, said an overwhelming majority of gas businesses in the markets involved were accused of participating in the scheme.
Eleven companies were charged with things like illegally fixing gas prices. They were able to convict four and only because they had an informant. I wonder how much similar activity goes on today across Canada that we cannot prove because there are no informants tipping the Competition Bureau off and the bureau does not have the authority to perform more than a cursory investigation of any consumer complaints. It can only investigate violations to the Competition Act, so a great majority of gas price complaints can go nowhere.
I hope the government will be open to starting a real inquiry into the matter and a public investigation of what can be done to really improve the situation for consumers.
One thing my party has been calling for is a gas price ombudsperson. Since the Competition Bureau is so limited in what it can do, we need an ombudsperson who could handle public complaints and give us strong and effective consumer protection.
Our member for has tabled Bill , which would do just that. It would enable Parliament to appoint an independent ombudsperson to investigate complaints about gas pricing and report to the ministry of industry if it is not satisfied with the response from the oil or gas supplier.
If given adequate investigative powers, the ombudsperson would help provide strong, effective consumer protection, including fines of half a million dollars if necessary, to ensure the really big offenders did not get away with swindling consumers. It would help ensure that we paid a fair price for gas so small and independent retailers would finally have proof that they were the good corporate citizens, as most of them are. It would ensure there would be greater oversight and accountability on the big oil companies. It is these big offenders and big distributors we need to go after, even more than those small business people with faulty pumps or the rare unscrupulous gas station owner who might nickel and dime customers.
There is one more thing I would like to bring up when it comes to fairness at the pumps.
No discussion of gas fairness is complete without talking about the harmonized sales tax. As we know, the HST being imposed by the Conservative government on consumers will raise the price of gasoline by 8% in Ontario. This price hike is orders of magnitude more costly than any savings Bill might ever bring to consumers.
Passing Bill off as a magic bullet to fix gas gouging, as the government is doing, while hiking gas prices across the board, is the biggest bait and switch in gas marketing history. It has been calculated that the average family of four, through the HST in Ontario, will be hit with an increase of $232 per year, even more in Thunder Bay where it is based on a higher price, and about $900 million across Ontario each year. It is a tax grab.
The Conservative government is tabling a fairness at the pumps bill to crack down on the 5% of pumps that are faulty, but hitting 100% of pumps with the biggest gas tax hike in history. Is this what Conservatives think of as fairness?
To conclude, this bill pays lip service to controlling unfair business practices in the sale of gas. Significant measures need to be added to the bill to make it really worthwhile for Canadian consumers who need it desperately. Do the Conservatives really care about consumers? Do they care about taxpayers? Do they care about average Canadian citizens, or do they really just care about big oil and oil and gasoline distributors?
It is my understanding that the amount of oil and gasoline that we export to the United States is roughly equivalent to what the east coast imports from Saudi Arabia and Venezuela. We know where the real priorities of the Conservatives lie, especially the Alberta-based Conservatives.
I hope the government will prove me wrong and will be open to stronger consumer protection measures in Bill . It will be a litmus test to see whether the government really wants to tackle gas price gouging or if it is all just political positioning.