That this House condemn the decision of Caterpillar Inc. to close its Electro-Motive Diesel plant in London, Ontario, with a loss of 450 jobs, and that of Papiers White Birch to close its Quebec City plant, with a loss of 600 jobs, and call on the government to table, within 90 days, draft amendments to the Investment Canada Act to ensure that foreign buyers are held to public and enforceable commitments on the ‘net benefit’ to Canada and on the protection of Canadian jobs.
She said: Madam Speaker, it is truly my privilege to introduce this motion on behalf of Electro-Motive Diesel workers of London, Ontario. This motion seeks to highlight the recent plant closures in my community of London and in a second community, that of my colleague, the MP for , with whom I will be sharing this speaking spot.
The motion also seeks to offer some remedy to workers across the country by calling on the House to draft amendments to the Investment Canada Act, amendments which most desperately are needed to ensure there are good paying jobs in Canada so that our families, communities and country can thrive. We need to protect Canadian jobs now. We can no longer allow the government to simply watch while good jobs disappear across our borders.
Many of the members across the aisle on the government benches have shrugged off any suggestion that this country is in the midst of a manufacturing sector crisis, but the figures from Statistics Canada do not lie. Canada has lost nearly 400,000 manufacturing jobs since the government took office in 2006. We have lost 40,000 manufacturing jobs in the last year alone. We are currently at a historic low in terms of manufacturing jobs going back to when these statistics were first gathered in 1976. I would like to note that this low is quite significant because both our labour force and our population have grown significantly over the same period. In other words, there are fewer manufacturing jobs in Canada now than there were in 1976.
Of particular note, the textile and clothing sector, which according to Statistics Canada has long been one of the largest manufacturing employers in the country, was the hardest hit among the manufacturing industries. From 2004 to 2008, clothing manufacturers and textile and textile product mills saw almost half of their jobs disappear. Manufacturing jobs are declining at a rapid rate in this country and most of these jobs are landing in China.
A Statistics Canada report found that China has become the world centre of manufacturing employment. In fact, the number of workers in manufacturing in China was estimated to be at 109 million in 2002, which represents more than double the combined total of 53 million in all the G8 member countries. The same report paints a dismal picture for the Canadian automotive industry, which is concentrated mainly in Ontario. In fact, my communities are still reeling from the effects of the closure of the Ford plant in Talbotville.
I would like to quote from the Statistics Canada report:
Automotive parts manufacturing lost more than one-quarter of its employees from 2004 to 2008, while motor vehicle manufacturing lost one-fifth. Parts manufacturers saw their jobs go from 139,300 to 98,700, which completely cancelled the strong growth from 1998 to 2004. For their part, motor vehicle manufacturers lost 15,900 jobs between 2004 and 2008, following a rather modest job growth of 5.0% from 1998 to 2004.
Just a quick reminder that most of these job losses have occurred under the watch of a Conservative government led by the . It is very clear that tax breaks to big businesses do not keep or create manufacturing jobs in Canada. We need a new strategy. We need an intelligent strategy.
The first step of the NDP strategy would be to make changes to the Investment Canada Act. We want to reduce the threshold for investments subject to a review to $100 million. We want to provide explicit and transparent criteria for the net benefit to Canada test. We want an emphasis on the impact of foreign investment on communities, jobs, pensions and new capital investment. We want there to be a required public hearing that allows for communities to have input into decisions on both the assessment of net benefit and conditions to apply to the investment. Last, we want to ensure public disclosure and enforcement of all commitments undertaken by potential investors. We also need to investigate and close the loophole in the Investment Canada process, whereby a takeover of a foreign company operating in Canada may not be subject to the act.
These changes would be the first step in the right direction for our manufacturing sector. A plant such as White Birch in Quebec City, when it was sold off to Black Diamond Capital, would have benefited from a requirement in the sale to provide a net benefit to Canada.
My own community of London has been particularly hard hit. The city's manufacturing sector has been shrinking at a rapid rate, and the auto sector jobs have all but disappeared.
Electro-Motive Diesel was one of those few plants offering good jobs that was still in operation. They were good paying jobs, jobs that helped support a family, jobs that helped support an entire community.
I have heard from the families of the workers who lost their jobs, from people such as Michele, who wrote:
My husband is one of the workers and he is devastated by the closure....How would people go about trying to attract a company like GE to come to Canada. It wouldn't be hard to line up a work force for them. How do you get government to offer incentives that protect the jobs of Canadians. There must be something that can be done for these workers....I hope the government does something about Cat doing business in Canada and makes them give back the money that the company received or provide good compensation packages to these workers.
The London community has been very supportive. I have heard from many people who have offered encouraging words to workers and their families, supporters such as Gary, who wrote:
First of all I give them credit for standing up to Caterpillar the way they did & for keeping a peaceful demonstration.
They deserve any penny they earned while working to build the best locomotive plant throughout the world & yet Caterpillar didn't appreciate all that these workers have done for them to build an excellent product & give Caterpillar fantastic profits, which would have continued if the workers had only been treated with respect.
Another London resident, Carl Campbell, headed out to the picket line and handed out 1,000 dollars' worth of $50 bills to locked out workers.
The loss of the Electro-Motive plant will impact our entire community. I heard from the local United Way just this week. The workers at EMD were very generous. They had raised over $100,000 in donations and payroll deductions for the United Way during its most recent fundraising drive. Sadly, the majority of this money will not be donated. Those jobs have been lost. The EMD families can no longer afford to support our United Way.
Canadians are recognizing what is happening to our communities. It is a crisis not just in my community but in many others. They have written to me and pointed to the obvious.
For example, Beth from Stratford, Ontario wrote to the Government of Canada to say:
The situation in London, Ontario with Electro-Motive and similar incidents in many communities across the land is destroying our country.
I urge you to review the June 2010 purchase of Electro-Motive by Caterpillar, under the Investment Canada Act. If it does not adequately protect Canadian jobs and workers then an overhaul of the act itself must be made and applied directly and immediately!
The EMD closure has been a hard lesson. What we have learned with the depletion of our manufacturing sector is that tax cuts to corporations are not a job creation strategy, nor do they keep good paying jobs here in Canada.
We have also learned that there are serious flaws in the Investment Canada Act that need to be addressed if we are to protect the remaining manufacturing jobs in Canada. We need to take action now. Communities across our country are begging the government to keep our jobs here. The families hurt by the loss of Electro-Motive Diesel do not wish that any other family suffer in the way that they as well as all of our community have suffered in London, Ontario.
Madam Speaker, this morning I am honoured to speak to this motion and defend the interests of thousands of workers across Canada. We are not talking about just the workers at Electro-Motive in London and White Birch Paper in Quebec City. We are talking about the large number of workers and retirees who have been directly or indirectly affected by the government's wholesale, reprehensible desertion of their cause.
I would like to sincerely thank my colleague from for having moved this motion and for giving me the opportunity to share my thoughts about it on this opposition day.
I will concentrate on the situation in Quebec City, beginning with some background information. It is important to understand all of the ins and outs. What happened at the Stadacona plant in Quebec City had nothing to do with market forces, constraint, profitability issues or anything like that, and everything to do with a manoeuvre that, unfortunately, within the existing legal framework, enabled outright theft, and I am choosing my words carefully. For months, I have been talking to the workers, the union and retirees to gain an understanding of the situation. I have had access to privileged information, and what happened in Quebec City is a real scandal.
Not long ago, on January 11 in Quebec City, White Birch Paper management sent employees a final offer, an ultimatum actually, which a staggering 91% of the employees rejected. We must not forget that, in December, around the holidays, these offers were preceded by a separate offer sent to the Rivière-du-Loup and Masson-Angers plants, which 99% of the workers rejected. From the start, White Birch Paper management has been trying to divide and conquer so that it can exploit Canadian families, families in Quebec City and elsewhere in the province.
On January 12, following what appears to have been an unfounded lockout ordered on December 9, 2011, White Birch Paper announced the permanent closure of the Quebec City plant without giving any reasons for the closure. Management talked about profitability and the impossibility of continuing operations. Unfortunately, White Birch Paper is a privately owned corporation, so it is not transparent and does not disclose information about production, profitability and what was really going on in its three plants. White Birch Paper also has a plant in the United States, where it is facing legal action because of manoeuvres that are considered fraudulent under U.S. law.
In response to the permanent closure, the union prepared a plan, a list of offers to reopen negotiations with management. In the end, management agreed, albeit half-heartedly, and negotiations are currently under way. Although I do not want to assume anything, I think I can guess the outcome. Unfortunately, there is a good chance the workers will be cheated once again, but we must give the negotiations a chance. We have always defended this principle. We defended it last spring during the Canada Post dispute, which was an unjust lockout. Thus, we must give the negotiations a chance.
Another important deadline is February 17, when the parties are scheduled to go back to court, and we know that the company has been under CCAA protection for the past two years. Justice Robert Mongeon will decide what happens next. Justice Mongeon has been very patient and very conciliatory, I might add. He has granted several extensions to allow White Birch Paper to come up with a solution and reach an agreement with its workers. The management of White Birch Paper has therefore had plenty of opportunities to address the challenges presented by the company's so-called difficult situation.
From the information I have gleaned and the conversations I have had with various stakeholders, the reality is that the current owner, Peter Brant, is a social misfit, an enemy of society in general, especially in Canada. Those are the facts.
The first company on the list of creditors is Black Diamond Capital Management, which happens to be the company that would buy back White Birch Paper's assets. White Birch owes Black Diamond Capital Management $157 million. Peter Brant, the current owner of White Birch Paper, is also involved in Black Diamond Capital Management, so this whole affair is quite dubious. I have a serious problem with that.
I do not want to name all of the creditors on that list, but there are several all over the world, particularly in the United States, including Credit Suisse—which is owed $32 million—GE Capital, Merrill Lynch and Dune Capital. White Birch Paper owes tens of millions of dollars to a slew of creditors and investment funds.
What really happened? The hon. member for provided an accurate summary of the situation. Unfortunately, under the existing legislative framework, money can be stolen outright, and it is Canadian families who have to pay the price. We are talking about 600 families of workers and as many, if not more, families of pensioners, not to mention a number of company closures. This has an enormous impact. Hundreds of other indirect jobs will also be lost as a result of the closure of the plant in Quebec City alone, not to mention the two other plants in Rivière-du-Loup and Masson-Angers.
Looking at the existing situation, we wonder why the current government is acting as an accomplice in outright theft—theft that, unfortunately, is legal because the laws are not adequate. I will not mention our private member's bill on the Investment Canada Act since the hon. member for has already given a clear and brilliant speech on that. I spoke with representatives of the Regroupement des employés retraités White Birch-Stadacona. They were shocked and gave their unconditional support for our bill on the protection of pension plan funds in the case of bankruptcy. The lawyer for the pensioners' association said it best when he stated that this is the law Canada needs to solve the problem.
Our two bills—we are focusing on just these two—are important in order to maintain a balance in industrial labour relations and labour relations in general. At the same time, the government must take responsibility for its people and protect Canada's interests, which it is not doing. We have a legal framework, but it is not necessarily enforced. There are no constraints, as the Investment Canada Act currently demonstrates. The government can close its eyes and say that it is sorry, that it cannot help what is happening, and that it believes the rich and ultra-rich who are basically vulgar social misfits and behave like common criminals by stealing from the people around them.
This government is basically an enemy of workers, pensioners and all Canadian families. A good example of this is the private member's bill that the hon. member for is trying to introduce, which directly attacks the ability of workers to associate in order to negotiate in good faith, as equals, with their employers.
The government is handing Canadian families over, with their hands tied, to a few national, but mostly foreign, interests. It is scaring away jobs, billions of dollars in capital and an industrial potential of which we were rightly proud and which we are going to lose because this government has given up and refuses to face reality.
I will end on that point. I do not want to get involved in a chorus of insults. I am being upfront about what is particularly important to me.
Madam Speaker, I am disappointed by Caterpillar's decision to close the Electro-Motive Diesel facility in London. This facility has had a long history in London and our government sympathizes with the workers there. We will continue to monitor the situation closely.
That being said, in essence this is a labour dispute between a company and a union in a provincially regulated jurisdiction. The federal government does not have the power to interfere.
In addition, I would like to say that I especially empathize with the workers at White Birch Paper in Quebec City. This company was under the protection of the Bankruptcy and Insolvency Act for two years, and it is very difficult to see working men and women find themselves in this situation. It will come as no surprise to anyone that I disagree with what the NDP has said in this regard, both today and in the last month.
I would like to take the time today to address certain statements that have been made. First, I would like to quickly explain the situation of White Birch Paper to the members of this House. This company owned three paper mills in Quebec between 2004 and 2008, including the Quebec City paper mill, which was purchased in 2004, and the Soucy and Masson mills, which were purchased subsequently. These mills were profitable for a while. However, the company ran into financial difficulty and filed for bankruptcy protection in February 2010.
In September 2010, the court approved the purchase of the three paper mills by a new owner, but the purchase was conditional on a new agreement between—a new agreement with the employees. As we all know, the new agreement was never signed, so the paper mills have not yet been sold to the court-approved buyers. In the meantime, the current owners decided to close the Quebec City mill.
I think it is important to clarify that the Quebec City paper mill had already been sold once in a transaction that required the Minister of Industry's approval. I am referring to the 2004 sale. White Birch bought the mill in a transaction approved by the former Liberal government.
We sincerely hope that there will be a future transaction representing a net benefit to Canada. However, the current situation is not covered by the Investment Canada Act. This situation is about solvency and labour relations, which are governed by provincial legislation.
The opposition has not done its homework. Once again, it has proven that it is incapable of governing. The opposition is way out in left field on this issue.
Next, I will discuss the history of the Electro-Motive Diesel facility. As the facility is in the constituency of the member for , I am somewhat concerned that I need to inform her that this plant has never been Canadian-owned. It has been American-owned from the very beginning, back in the 1930s.
Electro-Motive Diesel was initially owned by an Ohio-based company. It was then purchased by General Motors who in turn sold it to American private equity firms back in 2005. Then Electro-Motive Diesel, including facilities in Canada, the United States and Mexico, was purchased outright by Caterpillar, another American company.
The history is important within the context of my second point that this transaction was not reviewable. The reason it was not reviewable is that the plant changed owners when Caterpillar, a company based in a WTO country, bought Electro-Motive outright, another company based in that WTO country. Electro-Motive also had assets in Canada.
According to the Investment Canada Act, indirect acquisitions are not subject to review under our World Trade Organization obligations. That is the law. Those are our trade obligations at the international level. This is based on the belief that free and transparent trade creates more jobs and opportunities in the long term than the protectionist barriers on the NDP's wish list ever could.
With respect to those who have said that the government approved this transaction, they are mistaken. No such approval was required.
With respect to those who have said that we should retroactively review the transaction now, the law neither required nor allowed for a review to take place in the first instance, so a second review would be equally out of the question.
Finally, with respect to the leader of the third party who on Monday asked in the House “...how it could be that the government could have allowed such an investment without receiving guarantees from the company with respect to its future intentions...”, I would point out that this is the same law his current party oversaw for 30 years and in such time did not see fit to block a single transaction.
There is also another misconception that I need to correct. The member for has referred in her public communications to a $5 million tax break, and she appears to be of the belief that Electro-Motive Diesel received a $5 million subsidy. She is wrong on that point. In fact, with the greatest respect for my colleague across the way, the member is so wrong that she is either deliberately misleading Canadians or does not understand how the tax system works.
For the sake of clarity, let me read the section of budget 2008 that addresses support for the purchase of new locomotives:
Both the Standing Committee on Industry, Science and Technology and the Standing Committee on Finance have recommended an increase to the CCA rate on rail equipment. Budget 2008 proposes to increase the CCA rate for railway locomotives to 30 per cent from 15 per cent. This change will ensure that the CCA rate for railway locomotives better reflects the useful life of these assets. It will also encourage rail operators to acquire a newer, more fuel-efficient fleet of locomotives (e.g. hybrid locomotives), which provide a more environmentally-friendly mode of transportation.
This change is effective for new locomotives acquired on or after February 26, 2008, as well as for reconditioning and refurbishing costs incurred on or after February 26, 2008. It is expected to reduce federal revenues by a small amount in 2008-09 and by $5 million in 2009-10.
How this works is simple. Companies that buy locomotives benefit from a 30% capital cost allowance rate, whereas they used to benefit from a 15% capital cost allowance rate. The manufacturers of locomotives get no special tax break.
This measure was brought in to promote the purchase of more fuel-efficient locomotives. It was brought in with the enthusiastic cheerleading of the NDP. While that party did not see fit to actually vote for it in budget 2008, the NDP members did support the measure when it was recommended by the industry committee back in 2007.
I know that the NDP understands how capital cost allowances work. The question is, why are those members now deliberately misleading Canadians in order to score cheap political points?
The only logical conclusion I can draw is that the NDP is using struggling workers as an excuse. Now Quebeckers are learning more and more about the NDP's hidden agenda, which is based on a radical ideology that will directly destroy thousands of jobs. The NDP does not want Canadian companies to be involved in international trade. Its members are hostile to foreign investment and do not want Canada to be an economically productive country.
NDP members have voted against every single measure that we have taken to support manufacturing in this country, for example, providing tax relief to individuals, families and employers. They voted against enacting a 50% capital cost allowance rate for machinery and equipment. They voted against eliminating tariffs on machinery and equipment and industrial inputs. They voted against investing in skills training and infrastructure. They voted against supporting research and efforts to commercialize innovation. They voted against extended work sharing agreements to assist workers. I could also speak about forestry measures, where the NDP voted against the softwood lumber agreement and the black liquor $1 billion subsidy. Those members also voted against the $1 billion for the community adjustment fund. They voted against the $1 billion community trust fund.
That is all we need to know. In the middle of the worst economic downturn of our lives, the NDP wants to create obstacles for businesses that want to create jobs. It wants to make Canada less attractive to investors. In practical terms, during the first six years of our government, foreign companies invested nearly $270 million in Canada through transactions requiring review and another $150 million through transactions that did not require review.
On the other hand, the NDP plan for high taxes, carbon taxes, trade barriers, a hike in gas prices by 10¢ a litre and opposition to our natural resources sector is a plan that would erase all of that investment in the blink of an eye.
Third parties have confirmed that if we were to apply the plans currently proposed by the opposition, Canada would lose over 400,000 jobs. In the middle of our fragile recovery, that is simply terrifying. Those jobs would disappear because the NDP's mediocre economic plan includes massive tax hikes.
It is clear that the NDP economic thinking leads to false promises, dead ends and economic ruin.
Our government has an economic recovery plan that is working and, unlike the opposition, our government understands the importance of attracting foreign investment to Canada. We welcome foreign investment, innovation, international expertise and, more importantly, we welcome job creation.
Our government has a long-standing good reputation for welcoming foreign investment because it is an important driver of Canada's economic success.
Our government is determined to send the most favourable message possible to investors around the world to promote Canada as a secure and stable country and a great place to do business and invest.
Major investments will continue to be subject to review under the Investment Canada Act.
However, it is important to point out that the purpose of the Investment Canada Act is to provide a review of major investments in Canada in a way that encourages investment, economic growth and job opportunities in Canada.
In 2009, our government amended the act to strengthen it and especially to encourage foreign investment.
On the strength of recommendations from the Competition Policy Review Panel, the act was amended to liberalize the foreign investment review process. Once in force, these amendments will raise the investment review threshold to focus our reviews on those investments that are most significant to the economy and to better reflect the increasing importance to our modern economy of service and knowledge-based industries.
What is more, in 2009, we eliminated the barriers in the Investment Canada Act that targeted certain sectors, in order to ensure that investment in those sectors is subject to the same rules as in other economic sectors; this improved certainty.
Those barriers were an additional unnecessary burden for industries subject to efficient government regulation.
In addition to these amendments, we also introduced a review mechanism with regard to national security into the Investment Canada Act in order to ensure that, with increased foreign investment, Canada's national security interests are protected.
Other changes were made in 2009 in order to improve transparency in the review process and we acknowledged that there could be room for more improvement when it comes to transparency in the legislation.
I would add that the previous Liberal government never felt that such an acknowledgement was necessary. It is funny to see the Liberals here today take a totally different position.
I can assure the House that we are looking at the best ways to provide more information to Canadians about the review process, while ensuring that confidential commercial information remains protected. It is a question of balance.
Once again, this government's objective is to promote foreign investment. It is vital that our system guarantee investors that their confidential information will have the same protection in Canada as is afforded elsewhere in the world.
This cannot be a one-way street. By encouraging greater foreign investment in Canada, we are leading by example. If Canadian businesses hope to expand to new markets and compete successfully with the best in the world, we must walk the talk here at home and demonstrate to the world that protectionism is not the path to economic growth.
Make no mistake, when a foreign investor breaches undertakings that it has made to our government, we will not hesitate to take it to court to ensure it lives up to its commitments. That is exactly what we did in the case of U.S. Steel. We took U.S. Steel to court when we felt it did meet its commitments. That action resulted in a new agreement between U.S. Steel and the Government of Canada.
Under the agreement, U.S. Steel agreed to important commitments. As well, U.S. Steel will continue to guarantee pension funding obligations for over 15,000 current and retired employees. This means jobs and continued economic activity in both Hamilton and Lake Erie. Therefore, Canadians can rest assured that when the government believes that undertakings are not being respect, we will act.
As an aside, I would like to point out that it is not just foreign investment that we want to attract. We want Canadians to continue investing in our country. That is why we have a low tax plan for jobs and growth, which is working.
Canadians gave us a strong mandate to protect and complete Canada's economic recovery. We cannot say it enough: the top priorities for our government are job creation and the economic recovery. We are working hard and tirelessly to support Canadian workers during the recovery with our economic action plan, which has a track record of 6,000 net new jobs since July 2009.
We have also acted in the interests of Quebeckers by settling the sales tax harmonization issue. All Canadians must realize that this is a government that takes concrete action. We will not be shifted off course by the opposition's smoke and mirrors, such as this motion.
The NDP would undo all of that good work. The motion before us demonstrates that the NDP wants to shut down foreign investment in our country, and at the root it exposes a reckless high tax, dangerous plan for our economy.
Canadians have sacrificed too much in the interest of keeping our country strong during the global recession to accept a plan as destructive as that of the NDP. Therefore, I urge all members of this House to vote against this motion.
Madam Speaker, I will be splitting my time with my good friend from . I appreciate his generosity in allowing me to say a few words today.
I listened carefully to the words of the minister and my colleagues from the New Democratic Party. Although it is difficult in the context of a very partisan House, we have to try to come to grips with some difficult facts about the economy and with difficult challenges that we face. I would say very directly to the minister that if it is the legal view of the government that the Conservatives had no power to review a transaction like the one between the investors who bought the company from General Motors and the fully owned subsidiary of Caterpillar, then we need to take steps to ensure that we can review those transactions. We need to discover exactly the intention of a company that is at the point of purchasing a plant like Electro-Motive.
Like the member for , I am familiar with this plant. It was producing locomotives for decades in the province of Ontario. It was a profitable company. It always had a strong relationship with the Government of Ontario in terms of its own mass transit plans. It was an important source of exports, not only in North America, but indeed around the world. The company is well known to me and to many other people. It is a company I visited regularly, as the did on March 19, 2008, when he visited in order to have a photo opportunity and talk about the benefits of low taxes.
The hard fact is that we now realize that there are situations and corporate cultures in which it does not matter what the tax regime is or how far one races to the bottom. The company will still make decisions with respect to its own intentions and its own plans which are exclusively in its interests and not necessarily in the interests of the whole country.
I understand why governments have to say it is not their responsibility, but that of the Government of Ontario. I want to tell the minister that this is not a simple labour dispute. It never was. A labour dispute is when a profitable company and its workers are arguing about 5% here, 5% there or 10% here, 10% there. They argue about going from a defined benefit plan to an employee contribution plan. These are all issues that have been on the table in corporate discussions for a very long time.
When a very profitable company that is not without means, that is not facing a financial crisis, that is not facing a restructuring issue with respect to its operations, tells its workers to take a 50% cut, this is not a labour dispute. This is a company which has made a decision to relocate the plant. It was positioning itself to force the workers to go out on strike and then not have to take it. There was no bargaining with respect to 50%, or 75% or 80%. There was no discussion at any of the bargaining tables, of which I have been aware, of options put forward.
We know that we operate in an open economy, a market economy, an economy in which individuals and corporations have to base decisions on their economic interests.
Since the beginning of this conflict, it was clear that it was not a typical conflict between a company and its workers. The company was demanding wage cuts on the order of 50%, which had never been seen before in the region. The plant was profitable and competitive compared to other U. S. employers, with the exception of some of the company's plants in the United States. Naturally, the workers said that they could not accept a 50% wage cut.
A cut of 50% starts a race to the bottom such that we do not want to see in this country. The harder question for my friends opposite is this: If all the tax cuts in the world do not create an environment in which companies truly embrace the notion of corporate citizenship, do we not then have a problem?
I say to my colleagues from London and from the region, think of the consequences of a 50% cut with respect to mortgages or the buying power of the workers in London. Think of the impact on the whole economy. We are going to see that impact even more strongly, not with a 50% cut, but with the closure of the plant.
There is a challenge to the government, to Canadians and obviously to trade unions. However, this is not just a trade union issue. I think we make a big mistake to say that it is a trade union issue or, with great respect, that it is an NDP issue. The government speech that I heard was not about trying to understand the challenges that we face in this country in remaining competitive, but also in remaining fair.
We have to be competitive. Our economy has to be able to compete and be productive. The question is: Are we going to have an economy that is also fair and that responds to a prosperity that needs to be shared?
What is happening here is part and parcel of a broader trend in our economy. Those who are doing well are doing very well, but those who are doing badly are falling further behind. We have many instances, and the statistical evidence is overwhelming, where we are not moving to an economy in which the rising tide lifts all boats. We are looking at a situation where the rising tide has lifted a few yachts, but it is not lifting all boats. That is the challenge we face.
I know the government would say that the Liberals were in power for 13 years and this is what happened. Frankly, I think we have to get beyond some of that rhetoric and understand that it is not just about scoring partisan points here.
We are saying to the government that it cannot ignore this problem. It cannot say that this is just a labour dispute, not in its jurisdiction, not its problem and that it is doing a great job with cutting taxes. This is not just about saying the government produced 600,000 jobs since such a date. That does not cut it when we look at where those jobs are and what they are.
What is happening to manufacturing in Quebec and Ontario? What is happening to the base of good jobs that pay good wages and produce a standard of living not just for the workers, but for an entire community? That is the challenge that we face.
I certainly do not think we can live in an economy that puts up barriers. We cannot live in an economy that is protectionist. We cannot live in an economy that says we do not want investment. We have to be in an economy that welcomes investment. However, we also have to be in an economy that understands there are certain standards of corporate behaviour that we expect from the most profitable multinationals in the world. Certainly Caterpillar meets that category.
This is where the issue becomes more complex than the one the government is prepared to put forward, or even my friends from the New Democratic Party sometimes in terms of the rhetoric that one hears. It is not about beating up on corporate bad guys. It is about understanding that corporations produce jobs and wealth. If we do not have successful companies, banks and enterprises, then we do not have a successful country.
On this side of the House in the Liberal Party, we accept that 100%. What we cannot accept is that there is no role for governments, both federal and provincial, to play in bringing a reasonable standard of behaviour, whether on pollution, labour standards or employment standards, and to say that there are serious consequences for the community.
I know my colleagues from London understand this question. What is remarkable about what has happened in London is that it is not seen as the trade union versus the company. That is not the issue. It is about some sense of what a reasonable and fair economy is, compared to what we are seeing take place. That is the issue we are facing. Can we have a prosperity that is shared? Can we have a prosperity that is sustainable? On our side, we say we can. These are the things that need to change.
Madam Speaker, I want to congratulate our leader, the member for Toronto Centre, for his excellent speech. I would be anxious to hear perhaps after my speech when there is time for questions and comments, if members of the NDP can think of a foreign investment that has occurred in Canada that they would have approved. I do not get the sense that there has been a time when they have ever approved of any foreign investment. I wonder if they think that foreign investment in Canada has any value.
In most countries governments and people do want to see foreign investment and the creation of jobs that results from that. That capital flow into a country is important. I would be curious to hear what the NDP would do to encourage that kind of capital flow and investment in Canada, rather than just trying to scare off companies.
Having said that, I do commend the member for for bringing this issue before the House today.
I know the members of the Liberal caucus are convinced that our party must be committed to fighting for prosperity for everyone. This is a clear case of why we can never take our prosperity for granted.
Of course our hearts go out, as I am sure those of members on all sides do, to the workers who have lost their jobs, and their families, who have been left wondering about their future. What comes now for those who have worked for Electro-Motive Diesel in London, or for Papiers White Birch in Quebec City? This debate will clearly show that the Conservative government's priority is neither to create jobs, nor to protect the jobs of these hard-working Canadians.
Let us put this in the context of the overall economic management of the Conservative government. It is a government that came into power with a surplus of $13 billion and by April and May of 2008, before the recession began later that fall, it had already put Canada into a deficit. What horrendous fiscal mismanagement.
It is important to keep that in mind when we think about what the government has done in terms of economic management, and when we think about jobs and investment in Canada.
Instead of moving to amendments to strengthen the Investment Canada Act, what is the government doing? It is attacking seniors' pensions. That seems to be a good response. What are the priorities of its caucus members? They are raising issues like abortion and the death penalty. The ministers are sitting on their hands while significant job losses occur right under their noses. This gives an indication of the priorities of the Conservative Party. As we see in such a range of ways, they are ideological priorities. We look at the choices it makes, such as saying that the OAS and the GIS are not that important, that we do not have to worry about people in the future who are getting older. That is nonsense.
We know the residents of London, Ontario are deeply upset about the loss of 465 jobs after Caterpillar Inc. announced it intends to close EMD, Electro-Motive Diesel. The media have also pointed out that this plant closure is also very troubling for what it says about Ontario's ability to compete for manufacturing jobs. We have all watched in recent years as our dollar has climbed to parity and sometimes above parity with the U.S. dollar, and what that has meant in Ontario and Quebec for manufacturing jobs. It is a very difficult and troubling time. I heard it said years ago that with our dollar below 90¢ and certainly below 85¢, we can be extremely competitive and it is easy for us to sell our goods elsewhere, especially into the U.S., but when it is above 90¢, it gets a heck of a lot tougher.
Naturally, we know there are benefits to having the dollar at par. Having a high dollar allows Canadians to have cheaper access to goods that come from outside the country. It allows Canadian companies to buy equipment that can help them become more productive and competitive. There are benefits as well, but the impact we have seen from a variety of things, not only the dollar, but the developments globally in places like China and India and the movement around the world of manufacturing are things that we and the government have to come to grips with.
With respect to Caterpillar, an article in the National Post recently stated:
Caterpillar seems to have been a particularly unscrupulous employer, intent on closing down the plant, even while it dragged its employees through the charade of wage negotiations that were never going to bear fruit.
What happened in Quebec is also disturbing. People are very upset about the closure of White Birch Paper, which meant the loss of 600 jobs. The and members of his cabinet keep saying that the economy and jobs are their top priority, but Canadians now know that those promises are nothing more than empty rhetoric.
Earlier this week when the was asked what measures he took to protect those jobs at Electro-Motive, he threw up his hands in defeat, acknowledging his utter failure. Here is exactly what he said:
[T]his issue falls entirely within the powers of the Ontario government and there was no ability for the federal government to intervene.
What a defeatist, unconfident approach. The workers at Electro-Motive deserve better from the government and the minister. He should have demanded a meeting, for starters, with Caterpillar instead of trying to pass the buck and avoiding any accountability. When there was a photo op in 2008, the was front and centre at Electro-Motive Diesel smiling for the cameras. When there was an opportunity to help the workers at EMD, the Conservative government left them to fend for themselves, which is generally the Conservatives' attitude toward most Canadians.
What does it say to the folks lined up for a double-double at the local Tim's when they see the priority of the Conservative government is to create jobs for an additional 30 MPs by adding 30 more seats to this House instead of protecting the jobs of those workers at the Electro-Motive or Papiers White Birch plants?
An hon. member: Interesting priorities.
Mr. Geoff Regan: Interesting priorities indeed.
Many Canadians are wondering why the Prime Minister and his government did nothing to strengthen the Investment Canada Act after the attempted foreign takeover of PotashCorp or the TMX Group merger. Afterwards, they promised to hold a meeting, but we are still waiting.
Today's motion calls on the government to table, within 90 days, draft amendments to the Investment Canada Act to ensure that foreign buyers are held to public and enforceable commitments on the net benefit to Canada and on the protection of Canadian jobs. The Liberal Party will vote in favour of the underlying principle of this motion, that is, that the Investment Canada Act must be reviewed in order to provide greater transparency and accountability to Canadians.
The Investment Canada Act as it currently stands does not give Canadians confidence that their best interests will be served. Under the Investment Canada Act, there are no requirements for the federal government to disclose the rationale on the approval or disapproval of the sale, nor are there requirements for public disclosure of the commitments made by companies, such as jobs and investment.
The Liberal Party supports amending the Investment Canada Act to mandate public disclosure of commitments and to strengthen enforcement measures to ensure commitments are adhered to. Loan guarantees, like the previous Liberal government provided to forestry companies, could have helped companies avoid bankruptcy.
The Liberal Party believes that foreign investment is a good thing for Canada's economy. Rather than being a passive observer, the federal government should use its powers in an engaged, confidant and strategic manner, not to put up walls as my colleagues in the NDP always seem to want to do, but to maximize our advantages in the rapidly changing competitive global economy. That is what I talked about earlier. Let us look at what is happening in places like the BRIC countries, Brazil, Russia, India, and China, and how jobs are being created there. Jobs are moving around the world. It is a globally competitive economy, and we cannot ignore that fact.
The Investment Canada Act states in its purpose:
Recognizing that increased capital and technology benefits Canada, and recognizing the importance of protecting national security, the purposes of this act are to provide for the review of significant investments in Canada by non-Canadians in a manner that encourages investment, economic growth and employment opportunities in Canada and to provide for the review of investments in Canada by non-Canadians that could be injurious to national security.
I see that my time for debate is at an end. I encourage colleagues to vote in favour of this motion.
Madam Speaker, I am pleased to engage in the debate for a few moments this morning. First I will thank my colleagues, the mover of this important motion, the member for , and the seconder, the member for . They did a wonderful job introducing this issue in debate today and I thank them very much for their concern. I know their constituents are very thankful that they were elected to this House.
This is a very troubling trend that we have seen in our country. It has been going on now since 2006, for far too many years. Since 2006, we have lost over 400,000 manufacturing jobs in the country. The impact that it has on our economy generally and the effect that is has on the communities in which these jobs were lost is extraordinary.
We heard the member for talk about some of her constituents who work at the Caterpillar plant and the impact that it was having. She cited some personal examples of families that were directly affected. She also talked about the United Way organization in her community and how the workers at that facility had raised over $100,000 in support of the United Way, an organization that supports communities and families to keep the wolves away, in large part. They will not now be able to donate the money they were able to raise. That is the kind of impact that these kinds of job losses have on these communities.
Madam Speaker, I was remiss in not saying that I will be sharing my time with the member for . Undoubtedly, he will be able to tell us stories about the kind of impact this is having on his community. I look forward to listening to that.
When the member from talked about the impact the shut down and loss of so many hundreds of jobs was having on the constituents in her communities, she also presented legislative solutions to the House that could in fact go some distance to prevent this kind of occurrence in the future. That, frankly, is the difference between us in the official opposition and the government, and, for that matter, the third party. We are engaging in debate here on this issue and on trade issues. We are trying to say to the government and other members of the House that when it comes to negotiating trade, that we need to ensure that in our negotiations we do not sell away important jobs in our communities. If we are going to negotiate a trade deal, we are saying that we must ensure that it is to the benefit of our communities and the workers of the companies and organizations from one end of our country to the other. We must not get carried away with putting pen to paper, signing a deal with whomever simply for the sake of saying that we signed another trade deal with x country, and then see tens of thousands, literally hundreds of thousands, of good jobs lost as a result of those kinds of decisions.
When the stood in his place today and engaged in this debate, he said that this was a tragedy and that he felt bad for the workers and their families. However, did he offer any concrete solutions? Did he say that his government would introduce changes to the legislation to ensure this does not happen again? Did he say that his government would work with its provincial counterparts to ensure this kind of thing does not happen again? Not once did he offer those kinds of changes.
That is why the constituents in my riding of Dartmouth--Cole Harbour and Canadians from one end of the country to the other are asking whose side the government is on.
Caterpillar, a company that has been making extraordinary profits and has taken tax dollars in this country, has moved its operations to the United States. It made a record profit for 2011 of nearly $5 billion, an 83% increase over its 2010 profit. Caterpillar's CEO earned more than $10 million in 2010. We on this side of the House have been saying that, when it comes down to choices, the government chooses the CEOs who are making $10 million. It chooses the corporations that are making billions of dollars in profits.
That is why the government has continued to lower the corporate income tax rate in this country. It is down now to 15%, which is one of the lowest in the G20. This is resulting in billions of dollars being stashed away in the bank account of very profitable corporations. Are these corporations creating jobs? No. It just the opposite.
Caterpillar is an example of a company that took generous tax breaks and it greased the skids as it was moving the equipment and the jobs away from this country. That is wrong.
The minister said another thing that I find quite troubling. He stood up in this place and accused the member for and other members of this caucus of playing cheap politics with this issue when we talk about what a devastating impact this decision is having on working people. He calls that cheap politics. When we stand and offer solutions or when we urge the government to use caution when making decisions, the minister calls that cheap politics.
We have seen the colour photo of the Prime Minister four short years ago hanging out of the window of one of the locomotives at that plant pulling down on the air horn with a big smile on his face. He was talking about how, as a result of the tax breaks that his government was affording that company, he was ensuring there would be secure jobs in this country. We know who was playing cheap politics. The cheapness, the bitterness and the meanness of those politics have resulted in the fact that those jobs are now gone.
In the intervention by the leader of the third party earlier, he castigated the members of the NDP by saying that they were against this and against that. However, what he could not do was answer for the record of the Liberal Party when it was in government for 13 years and allowed this very event to happen time and time again. Foreign companies were coming in and not only taking over our Canadian companies and then laying people off but they were taking our intellectual property, taking patents out of this country and moving them somewhere else to the benefit of another country. The Liberals did not do a thing about it.
What we are doing in this debate is saying that what is happening to working people is wrong. It is wrong that we are losing these important manufacturing jobs in this country. It is affecting our economy and we are proposing solutions. We are prepared, as the official opposition, to work with members of the House and, after 2015 as government, to make the kind of changes that will protect and encourage the development of manufacturing jobs in this country.
Mr. Speaker, I thank the member for for his good points. I would also like to thank the member for for her tireless work on this issue and for bringing this motion forward today.
I rise today to speak in support of this opposition day motion. The motion calls on the House to condemn the plant closures of Electro-Motive Diesel in London, Ontario and Papiers White Birch in Quebec City. Together, these two plant closures have resulted in the loss of over 1,000 good quality, family-supporting jobs.
The motion also calls on the government to table within 90 days draft amendments to the Investment Canada Act to ensure that foreign buyers are held to public and enforceable commitments on the net benefit to Canada and on the protection of Canadian jobs. Canada's New Democrats believe it is time that Canada take a strong stand on the issue of foreign investment, in particular to bring clarity to the vague concept of net benefit to Canada.
In the past several months, far too many Canadians have experienced firsthand the consequences of allowing foreign companies to take over Canadian based companies with no strings attached.
When Electro-Motive chose to close its doors, 450 jobs were lost after employees stood up and said no to a 50% wage cut and reduction in benefits. Another 600 jobs were lost when Papiers White Birch shut down its mill in Quebec City after workers refused to accept a 21% wage reduction and cutbacks to their pension plan, which would have seen the value of workers' pensions decrease by 45% to 65%.
Unfortunately, Electro-Motive and White Birch are not the only factory closures in recent months. On February 2, AstraZeneca announced that it would close its pharmaceutical research and development facility in Montreal, with 132 jobs lost. Just days before a dryer manufacturer, Mabe, also based in Montreal, announced it would close its doors with 700 jobs lost by 2014.
Another 750 workers at Rio Tinto Alcan in Alma, Quebec have been locked out since January 1. Moreover, last year, 900 workers at U.S. Steel were locked out for 11 months. Also, 3,000 workers were on strike for over a year at Vale's plant in Sudbury and Port Colbourne in Ontario. Another 200 workers were on strike for over 18 months at Vale's plant in Voisey's Bay, Newfoundland.
Thousands of Canadian workers in the past year have stood up to fight cuts to their salaries and pensions. For many, it meant standing on the picket line day after day for months on end. For some, the consequences meant being thrown out of work just after Christmas.
The federal government seems to be an all-too-willing partner in this race to the bottom for Canadian workers' wages and pensions.
Last year we saw how workers at Canada Post and Air Canada rejected their companies' offers to slash wages and pensions. When the federal government intervened, did it come to the assistance of the thousands of workers who were fighting for improved salaries and pensions? Did it come to the rescue? Who accepted having the next generation of workers as a second tier not deserving the same level of compensation and benefits?
The government took the side of the employers and supported measures to claw back salaries and pensions. It intervened in the collective bargaining process, taking away workers' bargaining rights by mandating the workers back to work.
Members of this place remember all too well the long hours of debate on the government's draconian, heavy-handed back-to-work legislation.
It is clear that the Conservative majority government has been nothing but bad news for Canadian workers. Only Canada's New Democrats have been standing up and fighting against this regression in workers' rights and compensation. If the government's intervention in labour disputes were not bad enough, it has gone so far as to give no-strings-attached tax breaks to companies, which can decide at the drop of a hat to close down operations and move good quality Canadian jobs to other countries.
The Conservative government's job creation strategy is simply not working. While the government prioritizes slashing the corporate tax rate, unemployment levels remain high and investment is lagging. For every percentage point the Conservatives cut the corporate tax rate, the government loses $2 billion in annual revenue. Over the past 12 years, six years under the Conservatives and six under the Liberals, the corporate tax rate has dropped from 28% to 15%, which has meant that some $26 billion in revenue has been lost.
Now the Conservatives are trying to convince Canadians that we can no longer afford to let seniors retire at age 65, that our universal public health care system is unsustainable, that we cannot afford to eradicate poverty among seniors or provide funding for first nations education. This is ridiculous and incredible.
Governance is about priorities and it is clear that the Conservatives' priorities leave far too many Canadians out in the cold. The problem we have seen time and time again is that the rule book is too thin when it comes to the takeover of large companies operating on Canadian soil. The Investment Canada Act in its current form is simply not up to the task of ensuring that Canadian jobs are protected in the case of foreign takeovers. However, I believe there is a willingness among members of the House to make changes to the Investment Canada Act.
In 2010, Canada's New Democrats moved an opposition motion calling on the Government of Canada to take immediate steps to amend the Investment Canada Act to ensure that the views of those most directly affected by any takeover would be considered and that any decision on whether a takeover delivered a net benefit to Canada would be transparent. The motion passed unanimously, with the support of the Conservatives, the Bloc and the Liberals.
Today, I hope members of the House will again come together and agree it is time that the process for foreign takeovers be made more public, more transparent and more accountable. This would help Canadians believe that their government is acting in their best interests.
Our proposed changes to the Investment Canada Act are measured and reasonable. We propose reducing the threshold for investments subject to review to $100 million. We propose providing explicit, transparent criteria for the net benefit test to Canada, with an emphasis on the impact of foreign investment on communities, jobs, pensions and new capital investments. We propose requiring public hearings that would allow for community input into decisions on both the assessment of net benefit and the conditions to apply to the investment. We propose ensuring public disclosure and the enforcement of all commitments that are undertaken by potential investors. Furthermore, we believe it is time to examine the current loophole in the act that prevents the act from applying in cases where a foreign company takes over another foreign company operating on Canadian soil.
Since this act came into force in 1985, only two of the 1,500 takeovers have been rejected. Why is this? We do not really know. We do not know how or why the government deemed 99% of takeovers to be of net benefit to Canada. There are no criteria defining what constitutes a net benefit to Canada, nor does the act permit Canadians to know how the government arrives at its decisions on this.
It is time to make this act work for Canadians. Members of the House agreed in 2010 that the act required changes.
Today, Canada's New Democrats are calling on the government to table draft amendments within 90 days. I call on all members of the House to support the need for changes to the Investment Canada Act and to support our call for the government to bring these changes forward in 90 days.
Mr. Speaker, the closing of the Electro-Motive Diesel plant in London is a devastating blow to London, particularly to all the employees whose livelihoods have been impacted by this decision.
Ironically, the tragic news came out on the same day and within hours of finding out that London's unemployment rate had taken a dramatic drop. The reality of this situation is quickly settling in for the community, especially for the families and workers involved.
These workers are some of the best in the world and I believe their talents and skills will help them find future employment. Like them, I hope this is in our city of London. I truly ache for those who are now struggling to pay their bills, trying to take care of their kids and lying awake at night wondering where to go next. I will continue to do what I can, to help where I can.
Some will assert that the federal government did not do as much as it could have to save these jobs. I stand honestly before the House today to say that is not the case. The efforts of many parties were not enough in the end.
What has been most notable about this labour dispute in London was the amount of misinformation that was circulated. It was further complicated by many in the media, who continually repeated information without checking the facts. Like the overall situation at Electro-Motive, it was the workers in particular and the community at large that suffered from the constant circulation of misinformation.
It is important that Londoners and Canadians understand the situation more accurately before making judgment of those involved. I will share with the House some of the myths that were circulating in this past month.
The first myth was that Electro-Motive was a Canadian company that was sold to the American company, Caterpillar. The truth is that Electro-Motive has been owned by several American companies since 1930. In effect, Electro-Motive has been a Canadian subsidiary of different American companies for over eight decades. It was originally two Canadian companies, Winton Engine Company and Electro-Motive Corporation, that were purchased and merged by America's General Motors beginning in 1930. In 2005 an American equity firm bought the company and resold it to the American firm, Caterpillar Progress Rail Division, in 2010.
I will be sharing my time, Mr. Speaker, with the hon. member for .
Another myth was that the federal government gave money to Electro-Motive. The truth is that no federal government, Conservative or Liberal, has given money to Electro-Motive.
Another myth was that the visited the plant a few years ago to announce a tax break for Electro-Motive. The truth is that the Prime Minister visited the EMD plant to announce a tax change that would make it more affordable for Canadian rail companies to purchase newer, better and more environmentally friendly locomotives. This was a tax write-down for the customers of companies like EMD, but not for EMD.
To be clear, no monies were given to Electro-Motive. Nor were its taxes reduced as a result. In fact, customers like VIA Rail, CN Rail and CP Rail would benefit as they all ran a mix of both Electro-Motive and General Electric locomotives.
Another myth was that London's Conservative MPs did not meet with the Canadian Auto Workers Union representatives or the workers. The truth is that London's Conservative MPs did meet with members of CAW Local 27 in meetings in their MP offices. These meetings were intended to be productive and constructive conversations rather than photo opportunities.
There is no shortage of people willing to go to the picket line for a photo op, but as was too often the case, there was a shortage of thoughtful dialogue taking place. I met with workers privately and I also spoke to them at a demonstration in downtown London. Anyone with access to YouTube can see it for themselves.
Another myth was that the federal government had been silent about the Electro-Motive situation. The truth is that our federal labour minister had private discussions directly with Electro-Motive, the Canadian Auto Workers Union and London Mayor Joe Fontana in an attempt to encourage both sides back to the bargaining table. These discussions took place in mid-January. As the federal government had no legal jurisdiction over this labour dispute, although the Province of Ontario did, the federal labour minister appealed to the senses of both sides, but could not order that talks take place. She used her best moral suasion, but neither side was willing to blink.
I have not been silent either. I have now conducted more media interviews on this situation than on any other issue since being elected. While my comments are not always carried by the press, my message has been the same all along. Both sides should have returned to the bargaining table in good faith to bring an end to the uncertainty that lingered for the workers, their families and the community at large for more than a month. Nothing could be resolved until talks began.
It is also worth noting that I sent a very lengthy letter explaining this situation and my position to several thousand of my constituents. I have been providing weekly updates by email to almost 15,000 Londoners.
Another myth was that the federal government could legislate an end to this labour dispute. The truth is that if only it were that easy. The federal government did not have the power to end this labour dispute through legislation. It was a labour dispute between a private company and its labour representatives. The federal government did not have jurisdiction over this labour dispute.
The Government of Canada holds jurisdiction over federally-regulated workplaces, crown corporations and the federal public service. Some pointed to the example of recent federal labour disputes at Canada Post and Air Canada, one a crown corporation, the other a federally-regulated workplace, as examples of federal intervention. Electro-Motive is a private company. It is not a federally-regulated workplace.
I was genuinely surprised that the union in this case basically let the Province of Ontario off the hook. Instead, much energy was wasted trying to blame those with far less control over the situation for political reasons. Our mayor, a former Liberal minister of labour, jumped on the same bandwagon.
Another myth is that the federal government can order Caterpillar to continue Electro-Motive operations in London. The truth is Caterpillar is an American company that can legally decide where it wishes to operate in the world. The Canadian government cannot order any foreign company to do its business in Canada. This goes the same for Canadian companies.
Another myth is that the federal government could have reviewed the sale of Electro-Motive to Caterpillar and placed conditions and/or protections for the workers in the agreement. The truth is the sale of Electro-Motive did not trigger a foreign investment review by Industry Canada because the sale of the company was below the monetary threshold required for such a formal review.
Every day businesses are bought and sold by Canadians and foreign companies, and most do not trigger a formal review. This extraordinary intervention by the federal government is reserved for extremely large and sensitive transactions. They are triggered by the conditions in the legislation and they are not initiated at the whim of politicians.
When the Canadian Auto Workers was asked about the purchase of Progress Rail in 2010, CAW local 27 president, Tim Carrie, was quoted in the London Free Press saying, “This is an employer who has an interest in locomotive and rail. We’re looking at it in a positive light”. Had a review even been triggered at the time, it is likely, based in part on these comments, that the union would have been fully supportive of the sale. There was no indication that trouble lay ahead.
I again emphasize that the workers and the community were largely misled on many of the key issues. This did nothing to help bridge the gap between both sides, and I hope both sides have learned a lesson from this. The tragedy and fallout from this is that several hundred unionized and non-unionized workers from EMD, and even more firms doing work for EMD, are left to wonder what lies ahead for them.
Some have since suggested that the Canadian government ban Caterpillar products from being sold in Canada. While this would likely violate a number of trade agreements, Canadians can take action as they choose. Canadians can exercise their buying power however they wish. No government needs to legislate this power to citizens.
If people do not want to buy from Caterpillar, then they should not. If they can convince their friends and neighbours to do the same, they can. The power already rests with Canadians to make these decisions. Good companies should be rewarded with those dollars and those that fail to meet expectations should expect to find that it will affect their bottom line.
Has Caterpillar acted honourably in this labour dispute? If its intention was always to leave, then I would ask this question. Why did it not just make that announcement on January 1, which coincided, by the way, with the seven month contract extension that ended on December 31?
The misery and fear placed on all EMD workers was brutal. If Caterpillar truly intended to stay, was its in-the-face wage and benefit reductions due to local profitability concerns or because it had other options in Indiana? Now we will never know.
Clearly, the CAW was not prepared to preside over the single largest pay cut and benefit cut in its history. Neither side moved enough from their positions, and the workers in London are the losers for it.
I look forward to the rest of this debate and hope that these factual clarifications will help my colleagues debate honestly and factually about the issue at hand. I only wish to remind my hon. colleagues of the cautionary words provided to me by my Cape Breton mother. She said “Ed, no matter how many times they tell a lie, it does not make it the truth.”
Mr. Speaker, I know the hon. members from both sides of the House join me in expressing disappointment that operations at London's Electro-Motive Diesel have ended. My heart goes out to all those affected, especially the families and the workers.
However, my constituents, all Londoners and all Canadians deserve the facts. Our government never gave a tax break to Caterpillar. Rather, it was a capital cost allowance increase for the entire locomotive industry, an increase that all parties, including the NDP, supported at committee.
I am proud to be a Londoner and I have stood in this House on numerous occasions to point out the many achievements of organizations and businesses in my community and will continue to do so. However, I must say that I am exceptionally disappointed by the actions of the opposition, particularly the NDP member for . We on this side of the House take real action to sustain and create jobs in our community and strengthen our city's economy. Time and time again, the opposition has provided empty rhetoric aimed at tarnishing the achievements of businesses and organizations in my great city of London, Ontario.
Throughout today's debate, we have discussed investment policies and other factors that have an impact on the Canadian economy. However, I find it strange and unfortunate that the NDP has no apparent interest in the economic performance of this country and my city of London. Any discussion we might have about job creation in London and across Canada would benefit from evidence showing how federal investments have been working. Actions, not empty rhetoric, are the solution.
In August, I was pleased to participate via teleconference in a job summit hosted by the mayor of the city of London, the job summit that the NDP member for did not attend. This summit brought together political representatives from all three levels of government, businesses and other stakeholders from across the city to discuss how together we can strengthen economic growth in our city.
Recently, Statistics Canada reported that London's unemployment rate dropped almost an entire percentage point, creating 1,000 new jobs in our city during the month of January. Nationally, some 610,000 more Canadians are working today than when the recession ended, resulting in the strongest rate of employment growth by far among the G7 countries.
Since being elected to represent my constituents of , I have been pleased to deliver nearly $20 million in federal investments to businesses and organizations in my riding. It is a shame that the member for fails to acknowledge the millions of dollars in investments our government has made in Western University located right in the heart of London North Centre.
What do these investments mean for businesses and institutions in our city? Ted Hewitt, former vice-president of research at Western University, had this to say:
By providing researchers with the tools they need to develop innovative ideas, treatments and technologies that benefit us at home, we are able to continue to enhance--
Mr. Speaker, I will finish reading the quote that I started:
--the country’s research reputation on the global stage.
Our government has supported London's arts community by investing $30,000 in London's renowned TD Sunfest, $15,000 for London's Heritage Council Doors Open London program, and $25,000 for the London Fringe Festival.
Our government has invested in seniors and the disabled in my riding of London North Centre and all Londoners by investing $3.2 million in the centretown project. This initiative will create jobs for Londoners and offer 72 affordable housing units for low income seniors and the disabled.
Our government has supported job creation for London's youth by investing nearly $500,000 in job skills programs at Youth Opportunities Unlimited, $471,000 for a job skills program at Leeds Employment Services, and $17,220 for a job skills program at London's Pathways Skill Development & Placement Centre. All of these excellent organizations are located in my riding of London North Centre.
Londoners are hard at work in almost every aspect of everyday life of Canadians and those living abroad.
In October, Quantum5X Systems, a fantastic small business in my riding, received a federal grant of $50,000. What has it done? Recently it signed a contract with the National Basketball Association for the utilization of wireless microphone technology developed by Londoners to mic up players in the league.
I recently visited a remarkable small business in my riding, Voices.com. Voices.com is an innovative technology firm that recently developed an app that will allow toddlers to learn the alphabet in a fun and exciting way.
I also was pleased to recently visit a dynamic tech company in my riding, Big Viking Games. Founded in 2011, Big Viking Games was the result of a shared desire to create “audacious awesome-sause and epic ridiculousness on Facebook & Mobile platforms”.
Synergy Manufacturing, a small business in my riding that manufactures windows for homes and businesses, has doubled its employment numbers thanks to our government's economic action plan.
McCormick Canada, located in London, produces 100,000 pounds of honey.
Londoners working at the Labatt brewery company in my riding of London North Centre produce 1,029 bottles and cans of beer every minute.
New York City will have 2.5 billion gallons of safe, clean water thanks to London's Trojan Technologies.
Employees of London's Brose Canada ensure one in three cars are safer and more efficient.
Two thousand tonnes of CO2 will not be in the air we breathe tomorrow thanks to the 100 new jobs created for Londoners at the London plant of the German Solar Corporation, KACO new energy, Inc.
Billions of dollars are traded on the New York Stock Exchange thanks in part to the design team at London's Cyborg Trading Systems. There is a number one best selling app for that created by the designers at the Big Blue Bubble Inc.
When it came time for the opposition to take real action by supporting our government's investment in Londoners and all Canadians, it said no. What exactly did the opposition say no to? It said no to extending work sharing agreements by up to 16 weeks so that companies could avoid layoffs. Since February 2009, work sharing has protected 300,000 jobs.
The opposition said no to extending the targeted initiative for older workers to support training and employment programs for older workers who have invaluable knowledge and potential. This initiative has helped over 10,000 Canadians since 2007.
The opposition said no to the arts community by opposing the children's tax credit, which delivers up to $500 for parents across the country who enrol their children in arts, cultural, recreational and development activities.
The opposition said no to our government's new family caregiver tax credit, which provides $2,000 for caregivers of all types of infirm dependent relatives, including, for the first time, spouses, common-law partners and minor children.
The opposition said no to the hiring tax credit for small businesses, which provides a one year EI break for 525,000 small businesses across the country, reducing payroll costs for new jobs and encouraging hiring.
Since we introduced Canada's economic action plan to respond to the global recession, Canada has recovered more than all of the output lost during the recession. What did the opposition say to this? It said no.
Where was the NDP when thousands of unionized workers across the province of Ontario were negatively impacted by the dreadful social contract the Ontario NDP government introduced in the early nineties? Where was the NDP when the disastrous Ontario NDP government caused Ontario's economy to take a nosedive in the early nineties? That party was saying no to Ontarians with an all-time high tax reckless plan that cost our province thousands of jobs.
Do members want to hear some irony? The author of this motion, the NDP member for , was a cabinet minister in that disastrous Ontario NDP government.
When the doors closed at EMD it was a sad day for London, a sad day for Ontario and a sad day for Canada.
However, today's NDP motion is empty rhetoric. While the opposition continually says no to Canadians, our Conservative government has stood up, and will continue to stand up, for Canadians by taking real action to create and sustain jobs, strengthen our economy and provide a low tax environment. Canadians deserve real action. That is exactly what our government has done and will continue to do.
Mr. Speaker, I will be sharing my time with the member for .
My heart goes out to the workers of the EMD factory. It is never ever easy when massive layoffs take place, in particular at a technologically advanced modern facility. It is one thing for a factory to close when it has old equipment or there are better competitors in the field. However, for a factory to close that has one of the most modern production facilities in the world beggars belief. It makes it very difficult to believe that this was not the plan all along.
This company has a myriad of patents on this equipment. They are worldwide patents. Nobody can build what it builds. It is against the law in most countries where these patents exist for anybody to copy this equipment. There are significant environment regulations about to hit North America that require railroad manufacturers and operators to make their engines cleaner, and ships at sea as well.
This company was on the leading edge of that technology. It was the only company that was going to produce this equipment efficiently, so that operators would not use a urea spray system to clean the air as it escapes. This means rail operators would not have to carry along a tank of urea. This company was on the verge of perfecting that technology. It is a crying shame that the technology and the patents have left Canada. Apparently the equipment is going to leave Canada, too. The expertise and the workers are disposable and have been shelved. The workers will be left to the devices of the EI system. People hope EI offices will not be closing in London soon because a lot of people are going to need them.
There is a United States connection to this disaster as well. President Obama has done what the Conservative government refuses to do. He has insisted that public money in the United States designated for public projects goes to American companies. That is not the case in Canada. There is a lot of public money being spent by all levels of government. However, it is only at the provincial level that there is any requirement whatsoever that the money be spent on workers in Canada.
The Province of Ontario currently has a 25% regulation. If it spends money on public transit projects, it has to spend 25% of the money in Canada on Canadian workers. That is not the case federally. The federal government spends an awful lot of money, though not as much as it should, on public transit projects in this country. Yet it does not guarantee that a nickel of it will be spent on Canadian workers. In fact, it encourages companies that operate in Korea and China to bid on those projects. The government hopes those companies get the projects because Conservatives think taxpayers benefit from cheap labour. The taxpayers are also the workers in London and they did not benefit by the notion of cheap labour.
In the U.S. there is a huge Amtrak order coming. Of course, if EMD wants to access that order, it will have to build the trains in the U.S. because of the U.S. protectionist stance. There is no such stance in Canada. It was easy to close the plant because Canada did not have to worry about whether federal money had any link whatsoever to Canadian jobs.
The folks who actually earned the benefit of that capital cost allowance, the $5 million that flowed through to orders to EMD, are in the process of renewing their entire fleet. CP is re-powering its older fleet of hundreds of engines. CN will follow shortly. GO Transit and VIA Rail will follow because those fleets are not environmentally sound.
They have signed a memorandum of agreement with the to re-power their fleets with more environmentally friendly fleets. Now they cannot have the work done in Canada. The plant is closed and they have to go to the United States. They will still get the capital cost allowance, the tax benefit to the Canadian owners is still there, but they will now have to buy that equipment in the United States because we did nothing about stopping it.
GO Transit, a provincially regulated, owned and operated heavy commuter rail system currently has 57 engines pulling its trains around Toronto. It is in the process of ordering many more because commuter rail is expanding in Toronto, in part with federal money. Every single one of those 57 original engines was built at the EMD plant. The shell was built elsewhere for some of them, but every one of those engines was built in London.
Now those workers can look as the money flows out from GO Transit. Every one of those engines has to be rebuilt within the next 10 years. Every dollar will now go to Muncie, Indiana or somewhere else in the United States where there is another manufacturer, because they cannot be purchased in Canada. Why not? Because the only plant that built locomotive engines in Canada has now closed.
There is no reason for this to happen. Ontario has a 25% buy Ontario policy. There is no equivalent buy Canada policy from the Conservative government because it prefers that the taxpayer be protected by being able to buy in China, Korea, or in this case, the United States. GO Transit is going to refurbish all of those locomotives very soon. It was looking at EMD because it was at the leading edge of companies providing the environmental protection that GO Transit has been ordered to provide by the minister of the environment in Ontario. Now it cannot do that.
The Province of Ontario has an air-rail link, a train from the airport. It uses diesel engines bought in Japan. Why? Because it said there was no manufacturer in Ontario. The Liberal premier of Ontario said, “we are going to waive our buy Ontario policy because there is no plant in Ontario that could build that”. There is, but there is some other business going on.
When GO Transit has to buy another 57 engines, the Province of Ontario will be able to say the plant is gone, so feel free to buy anywhere. If GO Transit has to buy from EMD because it has the best technology, then the workers in Muncie, Indiana making $16 an hour will be the ones to get the benefit of tens, probably hundreds of millions of dollars of our taxpayer money.
That is wrong. We have done a disservice to the whole transportation sector in this country. We had one of the best employers in the world, building the best engines in the world, at the leading edge of the best technology in the world. That employer has now gone.
CN and CP are Canadian companies and get the capital cost allowance. I do not know if VIA and GO get the capital cost allowance. Those companies now have to go elsewhere. The capital cost allowance does not generate a single Canadian job.
One of the speakers earlier suggested that EMD did not get a single tax break from the government. I did not realize that there was a clause in the $60 billion reduction in corporate taxes that said EMD is exempt from this reduction. I think it did get a pretty tax break, but now it has left the country.
Mr. Speaker, I would like my colleagues from all parties to support this motion. It clearly condemns Caterpillar's decision to close its locomotive assembly plant, which has resulted in the loss of 450 direct jobs. Another 600 jobs were lost when White Birch Paper, in Quebec City, closed its doors.
We are calling on the government to table, within 90 days—which is feasible because we will surely have the time with all the time allocations it is moving—draft amendments to the Investment Canada Act to ensure that foreign buyers are held to public and enforceable commitments on the net benefit to Canada and on the protection of Canadian jobs. Hundreds of thousands of Canadians work in the manufacturing sector, which is in decline, but which is nonetheless important to a modern industrial society such as ours.
The Investment Canada Act is the main mechanism we have to review foreign investment proposals and approve or reject them. The act came into force in 1985 with the main objective of ensuring that foreign acquisitions represent a “net benefit”, a benefit to Canada. However, since it came into force, more than 1,500 foreign acquisitions have been approved under the act, and only two have not. More than 12,000 others were not reviewed under the act because they did not exceed the thresholds of $5 million for a direct acquisition, $50 million for an indirect acquisition, and $330 million for acquisitions by or from WTO investors.
The act has often been criticized for its lack of transparency, consultation and effectiveness, and for certain shortcomings with respect to its enforcement. It has very strict provisions concerning confidentiality, which make it difficult to disclose information. However, I have heard the say that he wanted an accountable, responsible and transparent government. This is definitely not evident in his recent actions.
The NDP's 2011 election platform contained several proposals regarding the Investment Canada Act, including reducing the threshold at which it would apply, increasing transparency, clarifying the meaning of “net benefit”, holding public consultations and ensuring public disclosure of all relevant information, particularly with regard to the quality and ethics of foreign investors. There are communities that are affected by these investments, and we must ensure that there will not be any negative impacts on the social fabric of these societies and communities, which are often rural but can also be major centres.
The hon. member's motion gives two prime examples of how the government's formula for giving large companies tax credits has failed. As I was saying, Electro-Motive in London and White Birch Paper in Quebec City alone represent a loss of 1,000 jobs, 1,000 families. That is not counting the other companies that have closed or have cut their staff. The job losses in these cases are certainly smaller, but they are just as significant to the communities that welcomed these companies. Often, the red carpet is rolled out. Communities want to welcome companies. The regions need these companies and they need the manufacturing sector. The departure of these companies is brutal. This is a very poor track record for a government that boasts about valuing job creation in our communities and the economic health of our country.
The hon. member's motion gives the government the opportunity to do things differently, to not turn its back on the Canadian families that it claims to hold in such high regard. Given the abject failure of the current system, the government should have the humility and decency to admit that the Investment Canada Act, as it now stands, is not effective and should agree to work with the opposition—for once—in order to bring about change and give Canadian families a chance to get out of this crisis. We often hear the government say that it has created 600,000 jobs. Where are they?
In the current climate of budget cuts, the Conservatives are determined to keep giving gifts to their big business buddies. Canada has become the laughingstock of big international corporations. It is too easy for them.
They are well aware that they can just come here and take advantage of our system and our workers. Our workers work hard and sacrifice their health to work for these companies. Then the companies leave town after they have sucked as much as they can out of these families with our government's help. That is scandalous. When will the government side with Canadians instead of with the big companies that take advantage of them?
The motion moved by my colleague from is extremely important to the future of our manufacturing sector. Hundreds of thousands—perhaps millions—of Canadians depend on this sector for their quality of life. These people are society's middle class. They are the people who contribute the most to our quality of life because they are the ones who consume the most and keep the economic wheel—the wheel of life—turning.
The middle class has been hit the hardest by all of the economic crises we have seen over the past 30 years, since 1980. After the “glorious 30” came the “laborious 30”. What does the future hold? The industrial sector—since that is what we should really be talking about today—started to decline in the modern era of globalization, and this is having a serious impact on Canada's morale. The industrial and manufacturing sector used to flourish in this great country in several domains, including the processing of leather, textile, paper, wood and metal, as well as appliance assembly. All of these domains have been hit hard by the inaction of successive Liberal and Conservative governments.
I am well aware of the principles of economic theories that say we must do away with the weak sectors when they are not performing. But this has no longer been the case for the past several years. Businesses that are doing very well and providing immediate benefits to their communities are being shut down and their owners are leaving. Someone else acquires them and then it is all over. Contrary to what this government believes, it is not a question of labour relations when an investor hijacks our economy and takes our jobs out of the country.
The NDP has absolutely no objection to foreign investment, contrary to what people here sometimes say. We simply want to ensure some sort of framework for investments in order to better protect our interests, our quality of life and the social fabric of an entire modern society in Canada. I truly believe that this government is completely out of touch and does not care about ordinary Canadians, especially considering some of the stand-up comedy routines we hear from its members to defend policies and ideas that are completely biased by an ideology that is not shared by the majority.
Everything they say in the House is nothing but insults and nonsense. The Conservative members from Quebec should be ashamed of themselves, because they are not standing up to defend the interests of Quebeckers or the manufacturing sector. The same goes for the members from Ontario. I feel as though this government no longer wants to work for the middle class. The social fabric created by these stable, good jobs forms the foundation of a modern, advanced society. I have yet to see the Conservatives do anything to support that. No sensitivity, no compassion, no logical reasoning on the part of a 21st century government. It is with great sadness that I conclude with a quote from our former leader:
My friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we'll change the world.
We can do it.
Mr. Speaker, I will be splitting my time today with the member for .
I am very pleased to speak to the motion presented by member for . It goes without saying that we are disappointed by Caterpillar's decision to close its Electro-Motive Diesel facility in London and by White Birch Paper Company's decision to close its idled Stadacona plant. I can tell members why from a very personal perspective.
I grew up in Cape Breton and unfortunately witnessed the closing of the coal mines, steel plant and the collapse of the fishery during the time when I was in high school there. I have great sympathy for the workers and their families affected by the decisions of these companies.
Unfortunately these events come at a time of global uncertainty. Because of that uncertainty, and as has already been pointed out, the government has taken significant steps toward helping manufacturing in our country.
Specifically, we have provided tax relief. We have enabled a 50% straight-line cost allowance rate for machinery and equipment. We have eliminated tariffs on machinery and equipment and on industrial inputs. We are investing in skills training, infrastructure, supporting research and efforts to commercialize innovation. The results are clear. Nearly 610,000 new Canadian jobs have been created since July 2009.
It is also important to reaffirm our government's commitment to welcome foreign investment that benefits Canada and Canadians. Foreign investment is absolutely critical to the Canadian economy. It introduces new technologies and practices that promote growth, employment and help spur innovation here at home. Foreign investment brings some of the most productive and specialized firms in the world to Canada and results in some of the highest paying jobs for Canadians.
Our government also realizes that Canada is a player in a globalized economy that provides opportunities to connect our firms to the rest of the world, and that is important. It allows our firms to grow, compete and become global industry leaders. In fact, Canadian firms have invested billions of dollars throughout the world and that has expanded markets and stimulated Canadian exports.
Therefore, foreign investment, both into Canada and by Canadian firms abroad, is a win-win for the economy. As a performer in the world economy, Canada has continuously attracted far more than its share of foreign investment and the result has been job creation for Canadians and economic growth for the country.
A policy opposed to any foreign investment, and make no mistake that is the real NDP policy here, simply ignores the facts. If we shut Canada's doors, it would have a devastating affect on our economy. Our productivity would fall, jobs would be lost, Canadian firms would be denied access to world markets, consumers would suffer and Canadian innovation would lag behind. It is obvious that foreign investment brings critical benefits to Canadians and we just cannot afford to fall behind.
Forbes magazine has recently named Canada as the top destination to do business in the world. To maintain our top ranking, we need to stay open for business and we need to welcome foreign investment that benefits Canada. This government will continue to bring the benefits of foreign investment to Canada by providing the right economic climate so firms in Canada will continue to prosper and create jobs for Canadians.
I want to be clear about the jobs. Companies recruit, hire and employ Canadian workers and terminate employment. However, foreign buyers also have to know that they must operate under federal, provincial and territorial standards and regulations. Federal and provincial legislation governs collective bargaining between the employers and the bargaining units. Once a union is certified, the employer must bargain with the union in good faith and attempt to reach a collective agreement because labour relations are a key issue for businesses and workers.
In our federally regulated sector, we strive to help the parties co-operate and work effectively toward common goals. Labour-management conflict does get the headlines, but labour-management co-operation really is the norm in our country. We know that Canadians take pride in their work and they want their businesses to be successful. We all realize that we have very strong common interests. Therefore, a spirit of co-operation guides our efforts to promote a harmonious industrial relation in our sector.
We work closely with workplace stakeholders to achieve that common goal of facilitating agreements between workers and employers. In the vast majority of instances, collective bargaining does work. The parties involved negotiate in good faith, are willing to compromise and end up with an agreement with which everyone can live. It is seldom necessary for the government to step in. However, where necessary, mediators and conciliators can and do assist employers and unions to resolve their differences without resorting to a work stoppage.
As I stated at the beginning, I am deeply disappointed that the parties in the two cases we are discussing today were unable to successfully negotiate a new deal. However, in all cases, whether federal or provincial jurisdiction, the deal which the two parties are able to reach on their own really is always the best one.
Although federal laws govern employment in federal workplaces and businesses, such as aeronautics, banking and communications, the vast majority of employment relationships in Canada are governed by provincial or territorial authorities. In the case of Caterpillar and White Birch Paper, provincial laws and standards apply. We believe that treating employees affected by a termination of employment with respect and dignity is of the utmost importance.
For federally regulated workplaces, the termination of employment is covered by the Canada Labour Code. Termination and severance provisions help protect workers from those sudden changes in employment. They also provide security through the transitions.
We know, we realize and it is accepted that Caterpillar and White Birch Paper are not federally regulated workplaces. Nevertheless, our government is quite aware that the workers who have been laid off need to be helped. That is why Service Canada is quick off the mark to provide direct assistance to the affected employees during this very difficult period.
Service Canada has been in contact with the employees to offer information sessions and provide them with information on how, where and when to apply for employment insurance benefits. General information and other applicable Government of Canada resources, such as income support programs, skills development and training, labour market information, as well as programs and services from the provinces, will also be provided at these information sessions.
Let me just underline that we help Canadians gain the skills and opportunities to achieve self-sufficiency. We also provide targeted supports for those facing particular barriers. We do all of that in partnership with the provinces and territories because our goal is to build a fair and a prosperous Canada where no one is left behind. Strong economic stewardship is a critical ingredient of this. We will ensure that Canada remains on the right track for economic growth and jobs. That is our commitment to Canadians.
While we disagree with the actions of Caterpillar and White Birch Paper and we really wish that this situation would have been handled in a vastly different manner, we advise members to defeat this motion as worded.
Mr. Speaker, as a member representing the great area of London in southwestern Ontario and as a small businessperson, I am happy to take part in today's discussion.
First I want to say how disappointed I am with the decision by Progress Rail and its parent company, Caterpillar, to close the London facility, and I express my sympathy and empathy for the families involved at that workplace.
I am going to attempt to discuss a couple of areas today and would like to share some thoughts about my home and paint a picture of London and southern Ontario, a picture that is far different from the doom and gloom of my colleagues opposite. I would like to set some records straight also, because in this place and back home some stories have been told that do not reflect reality. I would also like to share a vision of positive actions that are taking place and the support for jobs that this government has brought to London and southern Ontario. Southern Ontario is my home. I grew up in London and my kids went to school there.
This motion, much like everything else the party opposite has done, is pretty negative. If we were to listen to the rhetoric coming from the other side of this House, we would think that London had a great big grey cloud over top of it and it rained all day long, every day in London. That is just not true. My Canada, my Ontario, my London, my area of southern Ontario is often full of sunshine. It is full of smiles and hard-working people and full of people who go to work every day and are happy to do so. Unlike the member for , I believe in thinking positively toward solutions. London smiles. Londoners are proud of the job they do. Yes, the global economic recession has had a significant impact on southern Ontario, including London and the area where I live. However, southern Ontario has been there before.
I was a small business owner in bad times in the early 1990s when an NDP government caused a provincial recession in Ontario. It made being an employer and a job creator very difficult, but we grew. We put an effort into economic growth and passed into one of the greatest times of prosperity my province has ever seen. We have done it before and we are doing it again. We have people who are well trained in our work force. We have great skills training for those who still need it. We have land and facilities for businesses to grow and new enterprises to locate, and many are doing just that. Kongsberg, a company from Norway, through its great relationship building, decided it would come to London. Dr. Oetker, a food processor from Germany, has decided to locate in London. It is not all doom and gloom; there is sunshine out there.
We have infrastructure, great roads and highways, water and energy. We have close access to the United States by land through both Windsor and Sarnia within an hour or two of London, with the Great Lakes surrounding us and rail services and air cargo facilities available. Thanks to a forward-thinking city and to the help of this government, the London airport has a new air cargo facility to facilitate new enterprises looking to locate in London.
I would like to move to some of the mistruths and misinformation that I suppose my opposition friends feel they must use, because if they stick to the facts they cannot make the same political points or grandstand.
This government has helped business in many ways during this world economic downturn. Just a few examples are its lowering of corporate taxes, creating retraining opportunities and effective work-share programs and trade. The is out of Canada right now, doing some great things on trade with another country. We are looking for new customers because our largest customer, the United States, is suffering too. When a customer who purchases about 80% of everything bought in southern Ontario is hurting, we hurt too. These are just a few examples of what we are attempting to do as a government.
This government has also invested in London's infrastructure. Why? Because it creates immediate jobs and gives our area lasting assets for our children and my children's future.
The member for was all too quick to grab a great big cheque and stand in front of a construction site and say, “Hey look at me, this is great, my city is getting great jobs”. In true hypocritical fashion, when the cameras were off, she came back to Ottawa and voted against all of those things for London. That is just not right. When looking through some old photos last night, I found a picture of that event and discovered people celebrating London's growth under the economic action plan. The member for was right in front, funnily enough with a Caterpillar loader in the background. Apparently it is okay to use Caterpillar when it is about her job.
Speaking about being hypocritical and misleading, we continue to hear stories from the party opposite about some phantom investment given to Electro-Motive Diesel. Again New Democrats just cannot make points on the facts. They just twist them until they work for them.
Here is how the practices with the capital cost allowance work. First, in 2008 the entire industry committee, including the NDP member for , unanimously recommended an increase in the capital cost allowance rate for rail equipment. This change was effective for new locomotives acquired on or after February 26, 2008, as well as for reconditioned locomotives and the refurbishment costs incurred. This benefit went to the customers of Electro-Motive, not to Electro-Motive. My office received no calls during that time demanding that we stop getting more customers for the plant.
Let me now move to another piece of truth that will just not make the story if told correctly. When I grew up on Fairmont Avenue in east London, I remember the GM diesel plant. I remember the big, brown buses it made for the City of London. GM Diesel from 1950 on was a very fine employer in London; it employed a lot of people. GM Diesel, just for those who are not catching on yet, is General Motors Diesel, a fine American company operating in London since 1950.
The myth involved here is maybe best explained by Andrew Coyne in the National Post. He stated:
It’s a compelling story—foreigners buy “our” plant, steal “our” technology, and all with our money! Except:
EMD is not a Canadian company, and never was. Caterpillar bought it from a pair of American private equity firms in 2010; they bought it from General Motors in 2005, who bought it from its Ohio-based founders in 1930. Since 1935 it has been headquartered in La Grange, Illinois. The London branch plant was opened in 1950.
Caterpillar didn’t buy the London plant. It bought the whole company, including its La Grange operations, which is where EMD does its design and engineering work, as well as making parts. It seems unlikely it would have stashed its most valuable intellectual property at a far-off final assembly plant. (Incidentally, as the economist Michael Moffatt points out, GM moved all final assembly work to London from La Grange shortly after the Free Trade Agreement went into effect. The jobs we’re worried about losing to the States are jobs we took from them.)
Even if it were a Canadian company, and even if it possessed a Valhallah of patents, it still wouldn’t belong to “us”. It would belong to them: its Canadian owners, who shelled out good money for it, presumably in anticipation of selling it one day. Caterpillar didn’t steal the company: it paid for it. If its proprietary technology had any value, its previous owners would be just as capable of realizing this—
In every labour dispute, the answer lies with two parties getting together for a solution. As I have said before, I feel that Progress Rail and its parent company did not play the role of good corporate citizens in this, but it appears that very little attempt was made to negotiate a solution to this and save the jobs and keep them in London.
I would love to go on to explain all of the things that our government has done and will continue to do to bring those new industries to London. We have made investments in London with many jobs, including the startup of FedDev Ontario, an organization that my party started to look at economic development in southern Ontario. We have been asked many times by the members opposite, and it seems like it is always a one-off, about what we are going to do about something or why can we not do this or that. The one thing this government has been able to prove over time is that it can multi-task: it can do all of those things. It can create trade when our trading partners go away. It can create new jobs and help retrain workers.
I again want to say there are smiling people in London and it is not all doom and gloom. There is sun shining.
Mr. Speaker, I will be sharing my time with the hon. member for . This is a debate. What do we want here? The motion proposes to amend the Investment Canada Act to ensure that foreign buyers are held to public and enforceable commitments on the net benefit to Canada and on the protection of Canadian jobs.
What is the Investment Canada Act? This act is the main mechanism for reviewing foreign investment proposals and for approving or rejecting them. The legislation came into force in 1985. Its main purpose was to ensure that foreign acquisitions represented a net benefit to Canada. Since its coming into force, more than 1,500 foreign acquisitions have been approved under this legislation and only two acquisition applications have been rejected. More than 12,000 other acquisitions were not reviewed under this legislation because they did not meet the threshold for application of the act.
The NDP's 2011 electoral platform contained a number of proposals with regard to the Investment Canada Act, namely: reducing the threshold for investments subject to review; providing explicit, transparent criteria for the “net benefit to Canada” test; requiring public hearings; and ensuring public disclosure of important information. Our detailed proposals were included in that section.
As far as the closure of the Electro-Motive plant in 2012 is concerned, as we know, the employer, Electro-Motive Canada, had been acquired in 2010 by Progress Rail Services, a wholly owned subsidiary of Caterpillar. In accordance with our Investment Canada Act, a notice regarding the acquisition of Electro-Motive was submitted to the and approved. A receipt was issued in September 2010 declaring that this investment did not require further review.
This plant is located in London, Ontario. It produced diesel locomotives. The 465 plant workers were represented by Canadian Auto Workers union Local 25. During the collective bargaining process, the employer sought concessions, the result of which would have cut the salaries of a number of employees in half, eliminated the defined benefit pension plan and reduced a number of other benefits. Naturally, the workers refused to accept those terms.
I want to add here that the community, the chambers of commerce and all those involved in London should have taken a stand as soon as they knew the employer wanted to cut employees' salaries in half. They should have asked: what does that mean for the economy? What does that mean for small businesses? What does that mean for their families?
On January 1, 2012, the plant's workers were locked out. Picket lines were set up in front of the plant. Then, on February 3, Caterpillar announced it was closing the London plant. The union thinks that Caterpillar wanted to move the plant's operations to a non-unionized plant in Muncie, Indiana. As hon. members are probably aware, just a few days before that, Indiana passed a law recognizing the “right to work”, which means that workers do not have to pay mandatory union dues in order to be employed. Most of the states that have this kind of legislation are in the southern United States. Unions are much less common there and salaries are lower.
As we know, there is a movement in the United States whereby unions are no longer required by law in several domains, including the public sector.
Because this labour dispute came under provincial jurisdiction, it was not examined by the . However, Caterpillar's acquisition of Electro-Motive in 2010 was subject to a federal decision under the Investment Canada Act. It is important to note that Caterpillar recently announced record profits for 2011—nearly $5 billion. Reuters reported that these revenues far exceeded Wall Street's expectations. The profits represented an 83% increase over 2010. The forecast for 2012 is just as positive. Caterpillar's CEO had an income of over $10 million in 2010.
So people are wondering what is going on here. We have a multinational corporation earning record profits, yet it wants to close the plant. We have no doubt that offering workers 50% of their salaries was just an excuse to close the plant and move its operations south to the United States.
Rumours abound in the media suggesting that Caterpillar bought the plant simply to get its hands on the technology and patents. The union claims that the company had no intention of keeping the plant open. The Canadian Labour Congress says that Caterpillar should be forced to find a Canadian buyer. The Canadian Auto Workers' Union, the Communications, Energy and Paperworkers Union of Canada, the United Steelworkers and the Canadian Labour Congress have asked the government for stricter criteria for the approval of foreign takeovers so that workers' jobs, salaries and benefits are protected.
It is interesting to see that the members across the way are sympathetic to the workers' plight, but that is not enough. People have lost their jobs because of a policy that lets businesses do as they please. As the people's representatives here in the House of Commons, it is up to us to try to help these people. Sympathetic words are not enough. These workers need policy that protects them. These people belong to a community and contribute to the economy. With their good salaries, they buy cars, go to restaurants and contribute to the vitality of the community. We see that across Canada. Sympathy is not enough. The government must act. I urge the government to do something so that these people can get their jobs back in London, Ontario.