ENSU Committee Meeting

STANDING COMMITTEE ON ENVIRONMENT AND SUSTAINABLE DEVELOPMENT

COMITÉ PERMANENT DE L'ENVIRONNEMENT ET DU DÉVELOPPEMENT DURABLE

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, June 4, 1998

• 0915

[Translation]

The Chairman (The Hon. Charles Caccia (Davenport, Lib.)): Good morning everyone.

[English]

I apologize for the delay due to another meeting.

We welcome our witnesses today. As you know, we are engaged in the examination of Bill C-32. We are beginning deliberations with clause 1 of the bill, as is customary.

We welcome three groups today, the Canadian Chemical Producers' Association, the Canadian Manufacturers of Chemical Specialties Association, and the Canadian Vehicle Manufacturers' Association.

Please try to incorporate a procedure whereby you are allocated ten minutes each. At eight minutes there will be a very gentle reminder that you have two minutes left. We have done that with some reasonable success with organizations that have appeared before you. That releases more time for questions and answers, of course.

Without any further delay, and again with my apologies, who would like to go first? Would you like to introduce yourself and your people?

Mr. Richard Paton (President, Canadian Chemical Producers' Association): My name is Richard Paton and I'm president of the Canadian Chemical Producers' Association. Mr. Chair, we will definitely honour your time limits and look forward to answering the questions you may have.

I'll introduce Gordon Lloyd, who is the vice-president of technical affairs for CCPA, an area that covers environmental matters. We also have two company people attending with us, Claude-André Lachance, whom you know well, Mr. Chairman, who is the public policy director of Dow Chemical; and Amardeep Khosla, who is the manager of global technical policy with Procter & Gamble.

We brought both of these companies because, combined with the association companies, they can provide you with on-the-ground experience of how they work under CEPA and the initiatives they take in the environmental area.

Since we have provided a thorough brief to your committee on the bill, I'll make a very short presentation outlining our main views on Bill C-32 and our proposed technical changes.

Before I start on that, Mr. Chairman, I want to help you understand who CCPA is and our approach to environmental issues. We think this is quite relevant to how CEPA will work in dealing with our industry, and some of the fundamental principles behind the bill.

The Canadian Chemical Producers' Association represents more than 70 companies that produce chemicals across the country. These chemicals are vital to all sectors of the economy and responsible for about $ 30 billion of sales each year. Our industry constantly works on how to improve environment while maintaining economic development that benefits Canadians.

CCPA is, as I know some of the members are aware, well known nationally and internationally for its strong support for improved environmental performance. We have done our environmental performance under a program or initiative called Responsible Care.

Under Responsible Care, we are committed to working with government and communities to improve the environment. We have an exceptionally strong program of open information, community dialogue and verification to ensure that all CCPA members meet the 6 principles and 150 codes that are part of Responsible Care. These are part of a book we developed in the mid-eighties, which has become our initiative that we've been working on for the last 12 years.

Although our initiative is often called voluntary, it is by no means voluntary within our membership. Responsible Care is an initiative where Canada has shown international leadership. What started here in Canada has now spread to 41 countries.

The CCPA doesn't just promote the Responsible Care initiative. We support the need for environmental legislation and regulation, and we do not see initiatives such as Responsible Care as a threat to necessary legislation or a supplement to necessary legislation. We believe that legislation, regulation and strong enforcement can go hand in hand with voluntary approaches to improve environmental performance. In fact, we believe that's the most effective way to achieve environmental performance. Governments that are able to count on responsible industries such as ours in carrying out their environmental obligations are able to focus their efforts, their resources, and their enforcement on those who are less inclined to be concerned about the environment.

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We also believe government and responsible industry can work together to achieve improved environmental performance while maintaining economic development.

We believe government can play a positive role in environmental improvement by engaging many players in working positively and cooperatively toward meeting environmental challenges.

We've distributed a chart here that gives a brief example of the kind of progress we can make under our own voluntary initiatives. In these charts, as you can see, every single line goes down.

In terms of our Responsible Care ethic, we believe in transparency, and in openness of information. We track all of our chemical emissions through NERM, a report we publish each year. It's a much more extensive report than the one Environment Canada produces in terms of coverage of chemicals and emissions.

As you can see, the result of the tracking and the Responsible Care ethic has been a dramatic reduction in emissions for all our members. Members have reduced emissions by 51%, while value of shipments have grown nearly 20%. That's why we say, in CCPA, “Track us, don't trust us”. We believe actions do speak louder than words, and we have the performance to show that.

Both Dow and Procter & Gamble can speak to how they implement Responsible Care in their companies or improve environmental performance, if you'd like to learn more about what industry really can do within the context of these kinds of voluntary initiatives. I know there are some members on the committee who have chemical plants in their riding. I see Mr. Gallaway has arrived. I know Mr. Jordan also, and Mr. Charbonneau is familiar with the chemical industry in Montreal. These members can probably also attest to the kind of progress their industries have made.

I know you were down in Sarnia on Friday, Mr. Gallaway, and saw what kind of work Dow is doing to improve their environmental performance.

This progress was achieved through our commitment to decrease emissions, which goes far beyond the requirements of legislation and regulation at the federal or provincial levels. One of the Responsible Care guiding principles is to meet or exceed environmental laws and regulation in letter and spirit. It's for these reasons we are pleased with the emphasis on pollution prevention and sustainable development in this bill. We are pleased to see some recognition of voluntary actions in the areas of emergency response plans and pollution prevention plans.

Even though we think the bill could have built more on the success we have shown in our industry through non-regulatory or cooperative initiatives, we think this bill strengthens CEPA considerably, and for that reason we support it.

In general, we agree with strengthening and modernizing CEPA. We agree with the implementation of the toxic substance management policy, which has, by and large, worked. We agree with the addition of the pollution prevention focus to the bill, and we agree with the addition of the sustainable development thrust to the purpose and orientation of the bill.

Our basic position, Mr. Chairman and members, is that we want to make the bill more workable. We basically agree with the overall thrust of the bill. There's no doubt it's a very complex act, and a very long act. Some of you may have found it somewhat difficult to get through when you read it. Over the last four years, however, we've had a very important parliamentary committee report, a government response, an earlier bill, and now Bill C-34. The bill is the result of a long and thorough consultation process—all parties have had input—and is far more workable in a number of important areas than the previous bill, Bill C-74.

We have reviewed the bill carefully and we think that although it's complex, it is workable. However, I'm going to briefly mention seven changes we propose—you could call them technical amendments—that we think would make the bill even more workable.

The two most significant changes we're proposing in our brief relate to the provisions for the environmental protection actions. Although we are aware that other groups may think the provision of the bill may not lead to many environmental protection action suits, we are concerned about these provisions of the bill on a fundamental policy basis. We think Canada should not be making the same mistakes as the United States by adopting a litigation approach to implementing policy.

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Abdicating government responsibilities to the courts through right-to-sue provisions will not be effective in improving the environment. It may create uncertainty, and we don't believe it's a sufficient replacement for wholehearted recognition of what responsible industry can do through non-regulatory approaches and what government can do through effective enforcement.

So we raise some issues on that. We think some limitations should be provided on these provisions, which we can discuss if you have further questions. We also have some concerns about recognizing the role of science more clearly in the administrative duties section of the bill. We've proposed some changes relating to the export of hazardous waste and how the bill intends to deal with prescribed non-hazardous waste. Finally, we think the tracking provisions for new substances are too complicated. Provisions adopted in Canada should be similar to those in the United States.

To summarize, Mr. Chairman, we support this bill because we believe it strengthens CEPA in several areas. We think it is unfortunate the bill does not fully embrace the potential voluntary approaches, such as what we've accomplished through Responsible Care, but we think the bill is a step forward, and is workable.

Finally, in our view—and I know a lot of other industry groups share this view—it's time to move forward with this bill and get on with making some real improvements to environment in Canada.

Thank you.

The Chairman: Thank you, Mr. Paton.

Who would like to be next?

Ms. Shannon Coombs (Director, Government Relations, Canadian Manufacturers of Chemical Specialties Association): Good morning, Mr. Chairman and members of the committee. We appreciate this opportunity to address the committee, and at this time will present supportive comments on Bill C-32 together with some specific recommendations.

CMCS is a national organization representing a $ 12.5-billion industry that provided over 40,000 jobs in Canada. Our members are small, medium, and large manufacturers, processors and distributors of household products that include soaps and detergents, sanitizers, disinfectants, deodorizers, and lawn care formulations.

At this time, I'd like to defer to my board member, Mike Welling, who'll make some comments.

Mr. Mike Welling (Second Vice-President, Board of Directors, Canadian Manufacturers of Chemical Specialties Association): Good morning. As Shannon said, I am a member of the board of CMCS. I'm also the vice-president responsible for the home-care business for Lever Pond's.

Because the success of our industry depends extensively on the user of consumer-friendly products, we are sensitive to their use and disposal in the environment. Overall, our members see Bill C-32 as workable legislation that improves the management of the Canadian environment while recognizing the importance of a strong economy and sustainable society.

We commend the new strengthened provisions for pollution prevention and the proposals for stewardship. However, there are six areas in Bill C-32 to which the CMCS requests that this standing committee give further consideration—namely, the broadening and strengthening of the important role of voluntary initiatives; the singling out of cleaning products in the nutrient part of the legislation; the civil right to environmental protection action; the key role of sound science in policy-making; information gathering; and greater clarification in division 8, the management of wastes.

Due to the time constraints and the shared comprehensive comments presented by our CCPA counterparts, I will elaborate on the two key CMCS issues, voluntary initiatives and the singling out of cleaning products.

With regard to voluntary initiatives and non-regulatory tools, CMCS recommends that the legislation give more recognition to the important contribution of voluntary initiatives. We believe the minister or Governor in Council should have broad enabling powers to equate non-regulated instruments with meeting the requirements of CEPA. Such voluntary instruments would include codes, such as codes of practice, product stewardship programs, memoranda of understanding, and other environmental protection initiatives.

The chemical industry has provided much leadership in voluntary stewardship programs. CMCS members have actively engaged in this process and fully support the use of non-regulatory tools for the protection of Canadians and our environment. Voluntary initiatives maximize environmental improvements and promote sustainable economic growth.

Examples of CMCS member involvement in non-regulatory approaches include: the accelerated reduction and elimination of toxics program, or ARET; the national packaging protocol; the federal and regional smog plans; and the Canadian Aerosol Information Bureau, or CAIB, with which municipal governments across Canada recycle aerosol containers through blue box programs.

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With regard to nutrients in part 7, division 8, the CMCS recommends the definition and the words “cleaning product” be removed from all parts of part 7, division 1, and similarly—and I don't think this was identified in the original brief we submitted to you—from paragraph 46(1)(c) in information gathering, and be replaced with the word “product”.

CMCS is particularly concerned with specific references to cleaning products in the bill. The wording attributes unsupported negative environmental effects to cleaning products. As you will remember in the CEPA review, it was specifically noted that such singling out of cleaning products was inappropriate, and a comprehensive study was to be undertaken.

We know that a nutrient science study is under way, and offer our full assistance to it. In addition, we would like to be briefed on its methodology to ensure it's based on sound science. Similarly, in terms of any future studies, we're more than happy to make ourselves available to offer our assistance to aid in the development of the protocol of any such future studies.

Finally, we would request there be consultation to permit industry to analyse the study's findings.

The CMCS would like to thank the standing committee for taking the time to hear our recommendations. We believe they will significantly improve the legislation.

Thank you.

The Chairman: Do you have anything to add in terms of comments on Bill C-32, in addition to what you just said?

Mr. Mike Welling: With respect to not trying to repeat the efforts the other representatives have already brought up, the rest of it was identified in terms of our brief. So in the interests of time, unless there are some specific questions afterwards you wish to ask....

The Chairman: Thank you.

Who would like to be next?

Mr. Mark Nantais (President, Canadian Vehicle Manufacturers' Association): Thank you, Mr. Chairman. My name is Mark Nantais. I am president of the Canadian Vehicle Manufacturers' Association.

Let me begin by saying I'm certainly pleased to be invited back to appear before this committee to provide the views of the CVMA membership.

I would like to introduce to you Mr. Bruce Reid, who is the director, office of the environment, General Motors of Canada. I'm also assisted in the second tier by Mr. Larry Robertson, who is manager, vehicle, environmental and energy programs, Chrysler Canada Limited; Mr. Ron Bright, director, environment, energy and vehicle safety, Ford Motor Company of Canada Limited; and Ms. Lisa Kosma, office of the general counsel, Ford Motor Company of Canada Limited.

I've provided a summary of our recommendations, which I believe has been circulated, in addition to our written submission and a brochure on the CVMA and its membership.

The CVMA membership includes some of Canada's largest manufacturers of both light and heavy duty vehicles. In total, while we have six members, those members produce over 90% of all vehicles in Canada. Those members include Chrysler Canada Ltd., Ford Motor Company of Canada Ltd., Freightliner of Canada Ltd., General Motors of Canada Ltd., Navistar International Corporation Canada, and Volvo Canada Ltd.

The CVMA creates a framework within which member companies work together to achieve shared objectives on issues such as consumer protection, the environment and vehicle safety. Bill C-32, the Canadian Environmental Protection Act, is one such issue.

In the past, our member companies have had limited experience with CEPA because regulation governing construction and operation of manufacturing facilities resides primarily within provincial jurisdiction. On the other hand, new motor vehicle emissions and safety standards fall within the federal government's jurisdiction under the Motor Vehicle Safety Act, administered by Transport Canada. With the enactment of Bill C-32, however, this will change.

The vehicle manufacturing industry is impacted under the new CEPA as a result of specific regulations pertaining to vehicle engine and equipment emissions and fuels. Vehicle manufacturers will also be impacted by various other CEPA provisions, such as those applicable to toxic substances, wastes and enforcement.

Today we are here to provide you with our perspective, and we are recommending a number of enhancements to the bill to ensure that Canadians receive the maximum environmental benefits of the advanced technologies being introduced by motor vehicle manufacturers, both in their products and in their manufacturing operations.

In the interest of time, Mr. Chairman, I will simply highlight the elements of our submission along the following lines.

First, on part 7, division 4, fuels, the CVMA supports the federal government's leadership in regulating fuels. This is a necessary and positive step to ensure that consumers have appropriate fuels so the vehicle emission control equipment operates as designed, and contributes to improved air quality through the reduction of smog-related emissions. To date, almost all of the vehicle emission reductions are due to the emission control technologies that vehicle manufacturers have placed on cars.

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The vehicle manufacturers' ability to comply with increasingly stringent emission standards to contribute to improved air quality and to meet the expectations of the Canadian public is directly dependent on fuel characteristics. Reformulated fuels and cleaner-burning gasolines have been demonstrated in other jurisdictions, such as the United States, to effectively reduce real world vehicle emissions not just from the new-vehicle fleet, which represents only about 8% on an annual basis, but from 100% on the on-road fleet of vehicles. This is an essential element to reducing smog not just on a national level, but on a provincial level as well.

The renewed CEPA must provide the much-needed recognition that a total systems approach is required for fuels and motor vehicle emission controls. It must recognize that the full benefit of emission control technology cannot be realized without appropriate fuel quality being made available throughout Canada.

This fact has been readily demonstrated in the state of California, where it's estimated that the implementation of that state's cleaner-burning gasoline program was the equivalent of removing 3.5 million vehicles from California roads. In fact, the chairman of the California Air Resources Board, Mr. John Dunlap, has stated that it would have taken several years of ongoing air quality measures to match what cleaner-burning gasoline accomplished in just a few months.

The current CEPA contains only limited powers to regulate the formulation of motor fuels in Canada primarily on the basis of health impacts or where combustion could “significantly” contribute to air pollution. This limitation presents a critical impediment to CEPA's ability to protect the environment and prevent degradation to Canadian air quality.

Unfortunately, similar wording has been adopted in this newest legislation, Bill C-32. The provisions of subclause 140(2) of Bill C-32 only enable the federal government to regulate fuels where the regulation could make a significant contribution to the prevention of or the reduction in air pollution. As it is unclear what would constitute a significant contribution, the government's ability to enact legislation governing fuels will be limited in any enacted regulations subject to change.

Mr. Chairman, we are fearful of this. We are fearful that, for instance, the federal government will not be able to regulate fuels that are consistent with an announcement that was just made in Brussels this morning. It's an announcement of a worldwide fuel charter whereby 30 vehicle manufacturers from around the world put forth recommendations for fuel formulations to improve gasoline and diesel fuel quality to benefit consumers and the environment.

In addition to the U.S., European, and Japanese auto makers, the Canadian Vehicle Manufacturers strongly endorses the announced worldwide fuel charter. As motor vehicle manufacturers increase our efforts to market our cars and trucks globally, the need for consistent worldwide fuel quality has become increasingly apparent. At the same time, efforts to harmonize vehicle emission exhaust standards highlight the need to harmonize fuel standards. Mr. Chairman, you are probably the first to see that in Canada today.

Without the federal government having a clear and unencumbered authority to regulate fuels on a national basis, Canadians fail to gain the anticipated environmental benefit from the existing and advanced vehicle emission control technologies. Canada, by the way, will also have difficulty in securing future advanced technologies knowing that there will be greater reliance on higher-quality fuels to ensure design-intended emissions performance.

In division 4, subclause 140(3) and clause 146, which are regarding the variation of fuels, the references to “source” and “place” could be used to distinguish a fuel based upon its geographical point of origin. This may result in vehicles that are designed on a national basis to be subjected to different qualities of fuels throughout the country. This detracts from the total systems approach, which is an absolute requirement as we move forward. Vehicles operated on different fuels will have different environmental performance. Fuel and vehicle standards need to be dealt with as an integrated system on a nationally consistent basis without regional differences in fuel quality, which is critical to vehicle emissions operation. This is to ensure that the environment and all Canadians obtain the same emission reduction benefits from the emission control technologies on their vehicles.

Part 7, division 5, covers the responsibility for motor vehicle emissions authority. The CVMA has expressed concern previously about the transfer of legislative authority for vehicle emissions from the Motor Vehicle Safety Act to CEPA. Our concern resides in the fact that drive train, emission controls, and safety equipment are highly integrated, and a careful balance must be established in order to achieve the best overall compliance and performance at the lowest cost for the Canadian consumer.

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The Chairman: You can draw a credit of five minutes from CMCS. So you have another five minutes at least.

Mr. Mark Nantais: Our concern resides in the fact, as I say, that drive train, emission controls, and safety equipment are highly integrated and that there must be a careful balance established in order to achieve the best overall compliance and performance at lowest cost for the consumer and the environment.

For example, vehicle emission control technologies and many safety requirements that actually add weight to a vehicle may result in what we call a fuel economy penalty. In other words, the improvements to the fuel consumption of the vehicle that we have made and will make in the future could be eliminated by virtue of meeting other requirements or regulations.

In developing any new vehicle standards, a regulator must be aware of all the potential implications of the new requirements relative to other vehicle design elements and associated government programs. Transport Canada to date has been able to effectively perform this balancing requirement since they have had legislation authority in this area for a long time. CVMA would support the continuation of Transport Canada having that authority for all vehicle emissions and safety requirements to ensure that integrated approach. Environment Canada, on the other hand, would assume a policy and enforcement role regarding fuel quality standards.

The movement of the authority for vehicle emissions from the Motor Vehicle Safety Act to CEPA will require a fairly complicated transfer of administration and enforcement activities. Should this transfer occur, a provision should be added to CEPA requiring consultation with Transport Canada.

Also of concern to the CVMA are a number of other provisions in CEPA that have been addressed in terms of a seamless transfer of the Motor Vehicle Safety Act provisions, specifically: clause 149, which is the definition of a standard; clauses 150 to 155 inclusive, which cover the national emissions mark and the use of that mark; clause 156, which is the exemption from standards; and clause 157, which is the notice of defects, including contents of notice. In reference to each of these clauses, the CVMA in its written submission to the standing committee has cited concerns and provided recommended wording for improvements.

Turning to public participation in environmental protection actions, I would like to go on record as supporting CCPA's comments in this regard. Clauses 22 to 28 inclusive of Bill C-32 define the requirements for environmental protection actions that would allow citizens to sue for damage to the environment.

The environmental protection action duplicates existing provincial laws and common law rights of individuals and may serve to encourage frivolous litigation without any real protection to the environment.

The CVMA recommends amendments to the provisions in Bill C-32 with respect to the right-to-sue provisions along the following lines to include: the limitation of federal public resources, a bar to class actions, a defence on the basis of authorization by province or municipality, a defence on the basis of a reasonable interpretation of instrument, no court-ordered payments without the consent to the defendant, the deletion of the word “may” in paragraphs 22(3)(b) and (c), add five-year limitation period from the time of the offence to clause 23, and government must be a mandatory party of a suit.

Part 3 is information gathering. CVMA supports legislative authority for the minister to establish the national inventory of releases of pollutants under clause 46 of the act. However, the word “shall” in clauses 48 and 50 must be replaced with “may” to permit the minister to honour agreements as outlined in subclause 46(3).

As written, the provisions would not afford the minister the flexibility to decide whether or not to include information in inventories and reports that have been provided to her. The discretion should be retained by the minister to consider the need or necessity of publishing the information and the resource implications of this provision from both a government and private sector perspective.

The CVMA is also recommending changes or amendments to division 8 of part 7 regarding the minister's powers to limit movements of hazardous waste and to require plans for reducing or phasing out the quantity of waste that's exported. The minister's powers should focus on and be limited to those needed to fulfil Canada's obligations under the international agreements to which Canada is a party and implement the present manifest provisions and regulations in the Transportation of Dangerous Goods Act and ensure that hazardous wastes are properly tracked and destined for environmentally responsible facilities.

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The CEPA provisions under clause 188 also create a barrier to free market access to facilities that can best handle the particular waste. In many cases, the reason for export is the absence of suitable alternatives or technologies right here in Canada. In addition, recycling of hazardous waste should be encouraged. Materials that are recyclable represent valuable resources.

With respect to the interprovincial territorial movement of waste, we believe that this is adequately covered by the Transportation of Dangerous Goods Act and by provincial legislation.

Lastly, I'd like to turn to the issue of enforcement, environmental protection compliance orders, that is, part 10 of the bill. The stop-and-cease orders, specifically clause 35, are a powerful tool, as they enable inspectors to shut down an operation for up to 180 days prior to the determination being made of a contravention of the act.

While we recognize the need for enforcement actions, we believe these should be undertaken only in very specific circumstances. The scope of such a broad power needs to be clarified and limitations need to be placed on its use. Since a stop order could require operations to be shut down for up to 180 days, such powers should be exercised only where there is a contravention of CEPA and compelling evidence of imminent danger to the environment or to the health and safety of individuals. Stop-and-cease orders should also be made with the approval of a senior management person designated by the minister in order to ensure serious consideration of all the factors involved.

It appears that the appeal process under the renewed CEPA would be very time-consuming and cumbersome. A stop-and-cease order should be revocable by further order and there should be an expedited appeal process which would allow an appeal within several hours.

Finally, orders should be limited to a maximum of 30 days and reissued only if necessary.

Mr. Chairman, that concludes my remarks.

The Chairman: Thank you very much.

We will now proceed the usual way, with five-minute rounds, beginning with Mr. Gilmour, please.

Mr. Bill Gilmour (Nanaimo—Alberni, Ref.): Thank you, Mr. Chairman.

Thank you all for appearing before us. As you're aware, we have a pretty broad spectrum of people interested in this bill. One of the issues that I'm interested in is the litigation, the right to sue. The deputy minister was in about two weeks ago, basically saying that there was a balance. We had the environmental groups in on Tuesday saying it was not strong enough. And I understand and hear the concerns from your groups.

My concern is that it will be used as a vehicle to achieve results that may not necessarily be up front. I used the spotted owl example yesterday, where the spotted owl was used as a vehicle. It didn't have a lot to do with the owl but it had a lot to do with stopping logging. That's the concern I have with this type of litigation. It can be used by an individual or a group to go for other means.

I'd be interested in hearing your comments from that point of view. Do you see it that way? Where are the concerns?

Mr. Richard Paton: Can I suggest that Gordon Lloyd, the vice-president of technical affairs of CCPA, provide an initial answer to that? If necessary, Mr. Claude-André Lachance is ready to answer that question as well.

Mr. Gordon Lloyd (Vice-President, Technical Affairs, Canadian Chemical Producers' Association): I think this is a concern of a number of industry associations. All of us mentioned it here. We feel, I think, that the bill has made a fundamental wrong turn in having these environmental protection actions. What we're doing here is following a course that's been adopted in the U.S. We think that's led to litigation a lot more than it has to environmental improvement.

So we have some fundamental concerns about the environmental protection actions as a concept. However, I think that realistically speaking they are likely going to remain in the bill. They were a commitment in red book one.

We would be very pleased if the committee saw a way of dealing with the bill to delete that type of wrong turn. Failing that, I think the committee should look at how we can make sure those provisions are fair and balanced. Mark Nantais outlined a number of specific points, two of which I would like to focus on and which we mention in our brief.

We feel the whole purpose of these environmental protection actions, at least as set out in the red book, is to deal with persistent non-enforcement by the government of its legislation. If that's the situation, then one of the culpable parties is the government. If somebody is raising one of these environmental protection action suits, the government should be a mandatory party. I think that's logical.

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Right now the government is a discretionary party. I would be surprised if the government were to exercise its discretion to opt in very often. And if companies were discretionary parties to it, I don't think they would opt in very often either. But if you're going to have this provision, I think the government should be a mandatory party to it.

Secondly, there's no limitation period in this. There's sort of a limitation period in that nobody can bring an action two years after they become aware of it. But it could be 40 years in the past that something happened—or even longer. And there's an issue here: companies keep their records for only so long. With most provisions there are limitation periods, and we think there should be one with this. We've suggested five years. That's not a critical number. We think it makes sense, but what is more important is that there be some limitation period.

Those are the two fundamental areas where we would like to see the legislation cleaned up if the committee leaves this in the bill. We think the government should be a mandatory party to those actions and we think there should be a limitation period.

The Chairman: A very brief answer, please, Mr. Reid.

Mr. Bruce Reid (Director, Office of the Environment, General Motors of Canada Limited; Canadian Vehicle Manufacturers, Association): Certainly.

I very much support what Gordon has suggested. The concern we've expressed about the potential for frivolous action in this respect is one that does bother us. As companies, we all have a very great deal invested in our environmental reputations. This could provide an adverse influence in terms of how and how quickly we would want to settle something of this nature should it arise. And further, I would suggest, there is the fact that it needs only one person to bring such a suit forward. That certainly does concern us.

Thank you.

Mr. Bill Gilmour: In terms of fuels—

The Chairman: You'll have to come back on the second round.

Mr. Bill Gilmour: Okay.

The Chairman: Yes. Come back on the second round, and if I may,

[Translation]

Mr. Bigras, please.

Mr. Bernard Bigras (Rosemont, BQ): As I was reading your briefs, it seemed to me that you give a lot of importance and a lot of merit to voluntary initiatives. You point out that, in fact, some companies are good corporate citizens and do care about the environment. Personally, I tend to agree with you. I am one of those who believe in the notion of sustainable development.

However, when we were reviewing the issue of enforcement, a number of people who are responsible for that and who came before the committee told us very clearly that the legislation is better enforced when it includes material sanctions. It's a fact. We were given examples of companies which, presumably, behave better because of such sanctions.

Could you tell me very clearly what kind of balance you would like to have between voluntary and coercitive measures. It's true, some companies behave properly, and I personally know some of them in Quebec, but there are also companies which behave badly, and this has an important impact on the environment.

So how can we balance these voluntary initiatives and legislated provisions to reach our objective, which is to protect the environment?

[English]

Mr. Richard Paton: Perhaps I could start to answer that, but I'd like to ask Claude-André to perhaps.... No, sorry, it was Deep from Procter & Gamble who was going to come forward to give you more of a company perspective.

It's hard to answer your question in generic terms, because probably in every bill in every area we have the very specific kinds of equilibriums you mentioned. But I think our view is that you need a clear legislative base for government to exercise its responsibility with respect to environment—a regulatory base—recognizing that in the world of business there are companies that are extremely high in terms of their environmental responsibilities and companies that are extremely low, and recognizing that you need a floor of regulation that deals with the extremely low performers. We call them the “free riders”, the people who are perhaps not as concerned about the environment as some of our companies or our colleagues' companies are.

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But that legislation should not just be premised—and this is a concern I have had about legislation in the past and even about this legislation to some extent—on the idea that all players are bad, that all players are not responsible. In fact, there is much evidence to show that there are many companies out there doing far more for the environment than any legislation requires them to do. And they really believe strongly in voluntary initiatives, as you can see from our own NERM report on emissions.

So this legislation should also create the possibility for positive improvement and for responsibility of industry, and it should give them some room to pursue what they see as their ethics or their responsibility in improving the environment. Most legislation in the environmental area is premised on a punitive control philosophy that assumes companies will not improve themselves automatically and that many times puts rules, regulations and permitting structures in place in provinces that actually limit environmental improvement by companies who want to improve.

So in my view, we still don't have the balance. We are not opening up enough opportunities for some companies to pursue positive improvements.

Other environmental groups will say the more voluntary initiatives you have, the less enforcement. I've heard that argument. Our view is that it's completely wrong.

If government focuses more on enforcement for those people who are the free riders or who are not very good in terms of their environmental performance, they may improve their enforcement record. And they may spend a little less time on those companies that are performing well and more time on working out mechanisms to encourage those companies that are responsible to continue to be responsible and to improve their responsibility.

I think there is a way to get a better equilibrium, and that equilibrium is to open up voluntary initiatives more in legislation, in a transparent way, in an accountable way, and in a completely open way, so that government can know whether we're performing or not performing and can verify the results or whatever.

Now could I just ask a company to say something on this, because Deep—

The Chairman: We are talking right into Mr. Bigras' question.

Mr. Richard Paton: Oh, okay. We can't—

The Chairman: Mr. Bigras, if you want to ask a second question, please do it now.

[Translation]

Mr. Bernard Bigras: My second question mainly concerns the way we can track the movements of hazardous waste. The Canadian Chemical Producers Association does not seem to deal with that issue in its brief.

I'd like to know if you have assessed the impact of clause 185 which has to do with regulatory fees companies would have to pay although they do take environmentally-sound initiatives. Some companies do follow the ISO standards regarding waste management, but there would be regulatory fees they would still have to pay. I know that the Vehicle Manufacturers Association deals more or less with that issue.

[English]

Mr. Mike Welling: I think you're looking for some input from both associations, and perhaps I could just ask you to clarify the question. Was your concern with regard to the definition of household hazardous waste, the handling of household hazardous waste? Perhaps I could just ask you to clarify that for me.

[Translation]

Mr. Bernard Bigras: Some Quebec companies told us that, because of this provision, they could face an additional burden in the order of several hundreds of thousands of dollars, which could, in some cases, threaten their survival. I'd like to know if, in each of the sectors of the industry you represent, the same concerns have been expressed in the past several weeks, following the review of the bill by some of your representatives.

[English]

Mr. Gordon Lloyd: Is this clause 188 you're speaking of?

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[Translation]

Mr. Bernard Bigras: Clause 185.

[English]

Mr. Gordon Lloyd: So this is a question about the fees for waste management, the charges for waste management. This isn't really an issue on which we have had concerns expressed to us by our members.

We have concerns about how the government deals with cost recovery generally. We would want to make sure there is an actual service being provided that companies are being asked to pay for, but in this particular area we haven't look at that.

Our concern in the waste area is more focused on what the government's powers are for prescribed non-hazardous waste, and also the potential in here to prohibit the export of waste to the U.S. when often that will be the most environmentally and economically sensible solution.

The Chairman: Thank you.

Mr. Herron, please.

Mr. John Herron (Fundy—Royal, PC): Thank you, Mr. Chairman.

I was reviewing some of the recommendations you have toward the back, where you've focused upon seven specific technical amendments.

I want to know if you could explain in a little bit more detail your recommendation 3, where you state that the government has stated that the role of science underpins government policy and actions. You go on to say that should be clarified.

Can you tell me how the recommendation you've put forth would actually clarify it? One could be concerned that this really doesn't embrace the precautionary principle that the bill has actually embraced in this legislation.

Mr. Gordon Lloyd: The precautionary principle is referred elsewhere in the legislation, and we have no problems with that. In fact, the chemical industry, both in Canada and globally, has supported utilization of the precautionary principle as it was articulated in the Rio Earth Summit in 1992. It's spelled out in the bill in that way. So we think that makes sense, and that's part of making sure that decisions are based on sound science.

We think the bill actually does a lot better job of that than its predecessor, Bill C-74, part of it being the appropriate wording for the precautionary principle being in there.

But we think when it comes to making sure that decisions are based on sound science, you should try to get the glass as full as possible. Although the glass is fuller here than it was with the last piece of legislation, we think the statement that we suggest should go into clause 2:

Decide to take actions and attribute priority to these actions based on consideration of environmental and health risks and other social, economic and technical matters

provides a useful underpinning for the rest of the legislation. It's not intended to take away at all from the precautionary principle but to complement the fact that the precautionary principle is also embedded in the bill.

Mr. John Herron: My second question relates to a section around clause 300—I don't have it in front of me—with respect to alternative measures for negotiated disputes.

I asked yesterday's group whether they were comfortable with that as a kind of progressive way to address, we'll say, minor violations or things where we say, well, what's the best thing we could do for the Canadian taxpayer or for the environment? Could you advise me of your opinions on that?

Mr. Gordon Lloyd: Yes, we would agree with this. We think this is, in broad strokes, a good provision that makes sense. We see some areas where we think it could be better. When we had a lot more detailed concerns that we expressed with Bill C-74, this was one of the issues we raised. There haven't been changes in here.

I'd point out to the committee that there has been an inconsistency in this section. One basis of this clause is that you have to admit responsibility, and that's fair enough. There are also provisions in here, in subclause 296(3), that no admission can be then used if there is a subsequent court proceeding. But then there are contradictory provisions in paragraph 306(1)(b) that say the reverse, that anything the government has in its records from development and discussions with the company for these alternative measures can be brought forward in court proceedings. We're not quite sure how to land in the middle of those two seemingly contradictory remarks.

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We think if that is going to work, the spirit behind that means that if you go into the alternative mechanisms, then discussions you had there shouldn't be held against you if there's a subsequent court proceeding. That is an area that would be possibly useful to clean up and clarify.

The Chairman: Thank you.

Mr. Knutson, please.

Mr. Gar Knutson (Elgin—Middlesex—London, Lib.): Thanks very much, Mr. Chairman.

Mr. Paton, I don't have a question. I just want to make a comment, that I agree quite strongly; I think governments have to find a way of rewarding good behaviour and hammering the bad behaviour. I think we need to find a new word other than “voluntary”, but I don't know what it is.

Mr. Richard Paton: Another word, for sure. So we can work on that.

Mr. Gar Knutson: Yes.

Mr. Nantais, I'm surprised by your submission on the citizen suit provisions of the bill. My understanding is that similar legislation has existed in Ontario for some time, and while a number of requests have gone in to the government, it hasn't resulted in one lawsuit.

I'm curious; given that the bulk of your membership are manufacturers in Ontario, what hardship has the Ontario legislation put on, for example, Ford or General Motors or Chrysler? And if none, why are you raising alarms about this legislation, on this particular provision?

Mr. Mark Nantais: Mr. Chairman, I'd like to ask Lisa Kozma to step forward to provide an answer to Mr. Knutson.

Ms. Lisa Kozma (Office of the General Counsel, Ford Motor Company of Canada; Canadian Vehicle Manufacturers' Association): Specifically, our concern with this legislation is that it doesn't enact the protections that were negotiated through a lengthy process when the Ontario Environmental Bill of Rights was enacted.

At that time there was a very large coalition—industry and government and ENGOs—that sat down and decided what provisions would be necessary to make a right to sue work. It did include a number of provisions along the lines of what we have recommended adding to the federal legislation.

Specifically, Ontario's legislation is limited to public resources. It has a two-year limitation period from the time they became aware of the offence, rather than five years, and I think the other ones are pretty much broken down. But those are our real concerns.

Mr. Gar Knutson: Can I assume that if we were to incorporate the whole language of the Ontario provision, you would think that would be an improvement on the bill? Environmental groups have also suggested that the Ontario provisions are better from their point of view as well.

Ms. Lisa Kozma: Yes, that would be correct.

Mr. Gar Knutson: I don't have anything else at this point.

[Translation]

The Chairman: Mr. Charbonneau, please.

Mr. Yvon Charbonneau (Anjou—Rivière-des-Prairies, Lib.): My question is directed to the Vehicle Manufacturers Association. In your brief, you talk about gasoline emissions, etc., but I did not find any commitment on your part to build cars which would use less gas.

I know cleaner-burning fuels and reducing emissions are important issues, but isn't it possible, technologically speaking, to build cars which would use less gas and also, less and less?

Most advertisements focus on cars which go faster and faster and can be driven at 250 or 220 kilometres per hour, etc. What's the point? Over 100 kilometres per hour, you run the risk of being stopped. Certainly, if you drive at 120 kilometres per hour, you take a lot of risks. What's the point of putting on our roads cars you can drive at 220 kilometres per hour, which take only half a second, six-tenth of a second to reach 100 kilometres per hour, etc.?

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Could you tell us about your commitments in this regard? It seems to me that if our preventive action is to be aimed at the source of emissions, we should target gasoline use. Emissions are the product of gasoline use.

[English]

Mr. Mark Nantais: Mr. Chairman, the auto industry has a very big commitment to continuously improve not just their products but their manufacturing processes.

We need to talk about and we need to separate emissions from fuel economy. When we talk about emissions it's the oxides of nitrogen; it's the hydrocarbon emissions and carbon monoxide. When we talk about fuel economy we talk about CO₂ emissions, carbon dioxide.

To date, vehicle manufacturers have reduced vehicle emissions by 98% for hydrocarbons, for instance, and 90% for NO_x. We are committed to go even further with the national low emission vehicle program, which will take us to 99.3% on hydrocarbon emissions, for instance, in the year 2001 and 96% on NO_x.

In terms of fuel economy, we continue to make improvements year over year. They are incremental improvements because in fuel economy it's hard to get major gains. We've pretty much taken the low fruit from the tree in terms of those improvements. And we must respond to the marketplace. We must respond to what consumer demands are. So we have several challenges that affect our ability to do this.

But in terms of our commitment to fuel economy improvements in the future, the big three auto makers have set up a technical consortium to deal with huge improvements to fuel economy. We're talking about the partnership on new generation vehicles, where we're talking about improvements to 80 miles per gallon through a whole host of different things that go into vehicle design and manufacturing. That's why we've contributed, as partnerships in Ballard Technologies on British Columbia's coast, to make huge improvements to the fuel economy through fuel cells, for instance.

As I mentioned earlier, we have to respond to consumers' demands, and in so doing we have to provide a broad range or spectrum of vehicles. We're doing that now, and we're also of course pursuing alternative fuels where there is some additional benefit, not just from an emission standpoint but in some cases also a fuel economy benefit.

So the industry is very committed to the future. We are in the business of producing personal transportation and we intend to do that for the long term. In order to do this, it's absolutely necessary that certain fuels fall into place, because we're becoming more and more dependent on the characteristics of the fuel. That's why this worldwide charter came out this morning issued from Brussels, and it's in recognition of the fact that gasoline and diesel quality impacts the drivability, the fuel efficiency, durability and the environmental effects.

We can't make leaps and bounds because some of the technology is unaffordable at this point in time. That's why I said we'll put huge investments into alternate fuels, which include batteries. But you'll probably likely see things like hybrid vehicles come to the fore fairly soon, and those vehicles that can use the existing fuel distribution system are likely to make a larger penetration or have a more accelerated penetration into the marketplace. So the industry's very committed to that, sir.

The Chairman: Mr. Pagtakhan and Mr. Gallaway, five minutes each.

Mr. Rey D. Pagtakhan (Winnipeg North—St. Paul, Lib.): Thank you, Mr. Chair.

You indicated the need to encourage more voluntary initiatives versus the penalty approach, or at least enhancing that component. Is there an existing code of ethics within the association?

Mr. Richard Paton: You missed my earliest comments.

Mr. Rey Pagtakhan: Yes. I apologize for that.

Mr. Richard Paton: And I explained in them that since the mid-eighties we've had a Responsible Care initiative, which is outlined in this booklet, with six principles and 150 codes.

Mr. Rey Pagtakhan: And the code of ethics contains penalty provisions as well?

Mr. Richard Paton: It includes a verification structure.

First of all, all our members have to commit to this, otherwise they're not members. All CEOs have to sign personal commitments. We have a structure; for example, we produce a report on all emissions of all our companies, so we're constantly monitoring emissions. Companies, as part of the code, have to enter into a community dialogue process, because part of the ethic is that the chemical industry cannot operate independently of the community. It must be working with its community and must be open to its community.

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Mr. Rey Pagtakhan: In the history of the code of ethics in the association, has there been any breach of the code of ethics?

Mr. Richard Paton: That's not a simple thing to answer. Let me answer it this way: we verify our companies to find out whether they are meeting the code.

Mr. Rey Pagtakhan: Is there a disciplinary body?

Mr. Richard Paton: The verification process is, and then the board of directors of our association is the control body. So when a company doesn't meet the requirements of the verification, a report is published...including community representatives, other company people and environmental groups. A typical example would be that your community dialogue process is not sufficient; you haven't been open enough with your community and you haven't provided them enough information. And the company goes through a process of improving that, and only when they've improved on all the areas that the verification process has identified do they pass what we call “round-one verification”.

Mr. Rey Pagtakhan: What proportion of those who have been reproached as not meeting the standard within the code of ethics would you see among the membership of the association?

Mr. Richard Paton: Our goal is that all members of our association—

Mr. Rey Pagtakhan: I realize the goal, but in the actual review of the statistics, what proportion in fact had breached the code, didn't fulfil the requirement, and then only on intervention by the voluntary code of ethics did the change happen?

The idea behind my asking this is to see if indeed there is a need for a code of ethics—for example, if you do not find any culprits at all. If you do find a lot of culprits, say 50%, then of course it creates a different perspective in my mind. That's why I'm trying to gauge a sense of the operation of that code of ethics within the association.

Mr. Richard Paton: First of all, people don't join our association generally unless they think they can meet the Responsible Care code.

Mr. Rey Pagtakhan: I realize that.

Mr. Richard Paton: Only one company that we know of has left the association because they would not be able to meet the code. All the other companies that have been through the verification process—it's not a breaching process, it's a learning process—have reached a point where I think 45 of our 70 companies have now completed round-one verification, which they have to complete within three years of joining our company. By the end of this year, all companies that were to have completed the process will have completed the process. There will be no breaches. All companies will meet the phase one verification requirements in the timeframe we have specified.

Mr. Rey Pagtakhan: My last question relates to the statement that control of the regulation of the fuel quality is as important, if not more so, than that we achieve this emission control. And later on allusion was made to the fact that regulation of fuel relates to a specific ill effect, whereas the vehicle emission control regulation relates to another specific ill effect.

You mentioned the carbon monoxide and the carbon dioxide, and of course the two have an immediate effect on human health in terms of the respiratory system and the blood system, whereas the other one, the CO₂ emission, although perhaps not immediately so, nevertheless is equally important.

So my question is, what is the proportion you think would be contributed in terms of controlling the emission control, in terms of ensuring good-quality air, by regulating fuel and by regulating...in other words, I'm trying to find out the magnitude of the contribution of each variable.

Mr. Mark Nantais: That is a fairly difficult question to answer. We are now meeting emission standards that are the most stringent national standards in the world on the vehicles on the hardware side. We have to remember that those emission standards apply just to the new vehicles.

So one needs to look at two things. One is the fact that this technology, as we know it today, is becoming limited in its ability to reduce emissions. Even though we're at very clean levels, 99.3% for instance, it will be the level compared to pre-control levels in the year 2001.

So we need to measure, or at least take note of the fact, that this technology is becoming limited and therefore you must look at the other side of the equation, which is the fuel side of the equation.

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The fact that cleaner-burning gasolines, for instance, will reduce emissions from vehicles—not just new vehicles but old vehicles—in a very significant way will play a very major role not only in the government's ability to meet its smog reduction plans but also in the industry's objectives in terms of ensuring that those vehicles, which are intended to contribute to improving air quality, really perform as they're designed. If we don't have the fuels, we cannot do that.

A good body of knowledge has come forward now. When we talk about sulphur, for instance, in gasoline, it seems to be the ultimate culprit. It seems to raise emissions on just about all fronts. So the fuel side of the equation must be filled in at this point in time. The technology, the hardware, has really accounted for about 90% of all the emissions reductions to date.

So it's very difficult to give a specific answer, but that's generally how we see things to be shaping up.

The Chairman: Thank you, Mr. Pagtakhan.

Mr. Gallaway, you have five minutes.

Mr. Roger Gallaway (Sarnia—Lambton, Lib.): Thank you, Mr. Chairman. Very quickly, I wanted to ask Ms. Coombs a question.

You mentioned, in your spoken submission, concerns about the role of science. I wondered if you could very briefly elaborate on that.

Ms. Shannon Coombs: Would you mind if my board member spoke?

Mr. Roger Gallaway: No, not at all.

Ms. Shannon Coombs: Go ahead, Mike.

Mr. Mike Welling: I think the key issue in terms of the role of science, as has already been articulated by the members from the CCPA, is basically to try to make sure that what we're doing is acting on the basis of facts and substantiated evidence as opposed to acting on emotion, for example, in terms of making decisions. So our key concern is to make sure, recognizing that there are economic impacts and what have you in terms of decision-making, that we are in agreement that the fundamental basis for the policy is based upon sound science.

Mr. Roger Gallaway: Mr. Nantais, you've indicated a number of concerns with respect to the fuel provisions of this bill. As I understand this bill, it strikes a balance between government policy, industry needs, and other concerns raised by NGOs. I would suggest that your requests...you've requested that a number of changes be made in the provisions with respect to fuel.

Now, you may be aware that sulphur reduction is a concern and that in fact the industry has reduced sulphur in diesel fuels, and they did that through a voluntary approach. So I'd ask you, would you advocate a legislated approach to sulphur reduction, or would you embrace what some of your colleagues here at the table are saying, which is to do it by a voluntary approach such as was done with diesel fuel?

Mr. Mark Nantais: Well, I've had direct experience in the diesel fuel negotiations that took place. The petroleum industry did move forward on a voluntary basis, but that was only for part of the market. That was only for 25% of the market. That was the direction in which the government of the time decided they wanted to go. It so happened that the petroleum industry came back to us, specifically asking us to support regulation of diesel fuel on the basis that some of the independents, for instance, were unwilling to play the voluntary game. As a result, they were suffering a disadvantage in the marketplace. We said yes, we would support them on the regulation.

We endorsed the voluntary approach, but as I think somebody referenced earlier, there will be free riders, which is why we've always said that in terms of a voluntary program there should be a regulatory backdrop.

We see a great deal of resistance in moving forward on fuel quality from the petroleum industry. They do have some legitimate concerns relative to costs. The fact of the matter is that this is the direction in which the world is going. We only know how to do things so well with the technologies we have and we don't see any breakthrough, for instance, on catalyst technologies.

Sulphur is a known poison to catalysts. The petroleum industry themselves experience that at the refinery, where they have to shut down catalysts in the refinery process that are very, very expensive in terms of maintenance. So they understand what goes on in catalysts, and there's a good deal of independent scientific study now that clearly shows, in terms of its effect on technology, image control technology, in terms of its health effects, in terms of the emissions or the emissions relative to air quality, that sulphur is the ultimate culprit.

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Mr. Roger Gallaway: I want to relate what you've just said to what Mr. Welling talked about, and that is in terms of the role of science.

As you know, there's going to be ruling released in the next few days by a NAFTA trade tribunal on a bill that was passed in the last Parliament, which was in fact on catalysts, and the appearances seem to be that it's not going well for the government. That decision is unlikely to be in favour of the government's position on that legislation.

There was quite a public debate as between the petroleum industry and your industry, and there was a lot of science tossed around. The members of our caucus saw a lot of catalytic converters produced on tables. In the case where your science conflicts with someone else's science, who should decide? Are you in favour of an independent third body to assess the scientific evidence, or do you think it should be up to government scientists to make the final determination?

Mr. Mark Nantais: In the case I believe you're referring to, the government made a decision. They weighed the evidence at hand in the context of the precautionary principle and they made a decision. And they made the right decision.

The Chairman: Thank you, Mr. Gallaway.

We have to vacate this room at 11 a.m. because of another committee, so we'll start a second round very quickly after a few questions from the chair on the following.

Mr. Paton, your figures, namely figure 1-4, exclude carbon dioxides for very good reasons. Could you indicate them to us.

Mr. Richard Paton: Mr. Lloyd is going to address this. This area is under his responsibility.

Mr. Gordon Lloyd: We do track greenhouse gas emissions in our NERM report, and we've done that since 1992. We recognize that is an issue of concern. We haven't lumped it in with our other emissions reports because it would swamp them. The CO₂ emissions are just so much bigger that these graphs would all be meaningless. They would all just be CO₂ emissions.

Now, we do have among the graphs in front of you, I think, a graph about the global warming potential of all of our greenhouse gas emissions.

The Chairman: That's number 5-3.

Mr. Gordon Lloyd: Yes, thank you. What we have done there is taken all of the greenhouse gases that we emit.... Carbon dioxide has basically been flat. We've grown, while energy efficiency has kept out CO₂ emissions flat. Our other greenhouse gas emissions have led, when you take the waiting factors, to the 5-3 graph that's in front of you.

So we do track that, but we segregate it out because it would just swamp the other numbers.

The Chairman: Thank you.

In general terms—Mr. Paton, perhaps you may want to comment on this—would it be fair to say that these impressive graphs downwards, particularly figures 1-4, 2-1, 3-2, 3-3 and 4-2, are the combined result of efforts through improved technology and also the regulatory system?

Mr. Richard Paton: No, I couldn't quite totally agree with that. I think the legislative and regulatory framework is always helpful for providing some direction and guidance for industry, but I think it would be fair to say that without Responsible Care and without the commitment of companies—and these submission reductions go far beyond the legislative and regulatory framework—you wouldn't see these numbers.

The Chairman: Are you saying that the regulatory system in the last twenty years has been of no significance?

Mr. Richard Paton: No, I didn't say that. I said the legislation—

The Chairman: Would you admit that the regulatory system has also played a role in the reduction and in these fantastic graphs?

Mr. Richard Paton: I always would argue that legislation, regulation, plus voluntary initiatives go hand in hand and can produce a win-win solution.

The Chairman: Very logical.

Mr. Richard Paton: However, Mr. Chairman, regulations can also do the opposite.

The Chairman: All right, yes, but that is poor legislation.

Mr. Richard Paton: That's right.

The Chairman: I think it was Mr. Lloyd who expressed some reservations about citizens' actions. Are you familiar with the clause in the bill, clause 38, which makes a provision for the awarding of costs, which could be an effective safeguard against frivolous actions, don't you think?

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Mr. Gordon Lloyd: Yes, that is some safeguard. Also, that clause is a bit of a concern, because the way that clause is set up, it could be a surrogate for damages. We had thought one of the principles in the bill, or in these environmental protection actions, was that there weren't supposed to be damages awarded. I gather, from what Mr. Knutson said, that the environmentalists were of the same view.

The Ontario legislation is a lot clearer in a number of these areas. If the environmental groups want us to replicate all of the provisions in the Ontario legislation, which...

[Editor's Note: Inaudible]...the product, as was mentioned, a multi-stakeholder consensus, we would like to see those built in here. That deals with costs much better.

I'd just like to note, though, that if we do copy Ontario, the two concerns I highlighted won't be addressed. Ontario, just like any other government, didn't really want to be a mandatory party in these actions; they wanted to get out of the pot. As I said before, I think that's a wrong policy.

Also, the limitation period problems that I described wouldn't be addressed—they'd be improved somewhat, but they wouldn't be fully addressed—by adopting the Ontario legislation. But generally it's preferable to what you have in front of you.

The Chairman: Thank you, Mr. Lloyd.

Second round, Mr. Gilmour.

Mr. Bill Gilmour: Thank you, Mr. Chairman.

Going back to the sulphur in fuels, my numbers will be a little bit off, but I believe California is about 50 parts per million, B.C. is around 200 parts per million, and Ontario is about 500 parts per million. There's basically 10 times more sulphur content in our fuels in Ontario than in the fuels in California. Perhaps you can explain for me how much of a regulatory role....

Obviously California have mandated that it would be that low. B.C., I believe, have followed because of the problem they have in the lower mainland, where the gases get trapped within the Fraser Valley. But the concern I have is that Ontario has the highest concentration of vehicles, yet it also has the highest or, for want of another term, the dirtiest fuel. How much of the regulatory role is provincial versus what we might put into CEPA? It would appear that it's very much a provincial responsibility as opposed to federal.

Mr. Mark Nantais: We've always maintained that the vehicle standards should be national standards, and as I pointed out in our remarks and in the submission, if you have different types of fuels or different qualities of fuel regionally, it will present problems for the emissions performance of those vehicles. We believe it's absolutely necessary that a national approach be taken and we think that's what the role of the federal government should be.

There were guidelines through the Canadian General Standards Board, for instance, that some provinces adopted in their jurisdictions. You need to know, however, that as an industry literally all vehicle manufacturers in Canada resigned from the CGSB on the basis that the process was broken in terms of coming up with a balanced development of gasoline guidelines. We'll be glad to come back to that table when the system is fixed, but right now we don't see that happening.

But we believe a national approach needs to be taken here, because vehicles move around. Somebody commented to me this morning on the huge increase in leasing numbers, for instance. What we find, of course, is when a vehicle is leased, it could be leased in Sudbury but the vehicle actually resides in Toronto and could be subject to different fuel quality, and therefore the performance is affected. If that performance is affected, then if that vehicle enters an inspection maintenance program, for instance, and that malfunction indicator light comes on, that vehicle automatically fails. So that will present problems for the provincial governments in terms of their inspection and maintenance programs, which are critical to their smog reduction plans.

Mr. Bill Gilmour: But you still didn't answer my question. How much of the regulatory role is provincial versus federal? And you mentioned costs earlier. Costs in B.C. are roughly equivalent to costs in Ontario per litre, so why the discrepancy? Is it a provincial push? Is there not the push in Ontario to regulate the fuels to the level they are at in B.C. or California? Where's the fix?

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Mr. Mark Nantais: There is a role in the provinces, and you've seen evidence of that role when they adjust or regulate read vapour pressure, for instance, and sulphur levels in the case of British Columbia. So there is a role there; there's no question about that.

In the province of Ontario we would like to see them take a bigger role, which they've not yet done.

The Chairman: Thank you. That's a very interesting angle you are pursuing here, no doubt.

Mr. Herron, please.

Mr. John Herron: Thank you, Mr. Chair.

Just to enlighten the group, the bells ringing are not for a quorum. They are for a vote in about 20 or 25 minutes.

The Chairman: Yes, the vote will be in half an hour, at exactly 11.05 a.m., and it is a motion by Mr. Laliberte seeking the adoption of the report from this committee on emission and enforcement.

Mr. Gar Knutson: Do we have to go and vote against that?

An hon. member: No, no, you vote with it.

Some hon. members: Oh, oh!

Mr. Bill Gilmour: It's all lost, Gar.

Mr. John Herron: I always appreciate the fact that Mr. Knutson's a team player, so he'll be on-side with us on that one.

Moving along down your recommendation list, just to get some further clarification, I have some questions. The language you use in your recommendation number 4 with respect to the provisions that are equivalent in performance and intent, could you explain a little further how it would augment the existing legislation by adding that phrase, “performance and intent”?

Mr. Gordon Lloyd: Yes. It's important that in the bill there be a recognition of the duality in Canada of federal and provincial involvement in environmental protection. That duality shouldn't lead to a lowering of standards, and both the harmonization accord, talking about higher standards, and the bill make sure that's the case. But companies will sometimes be doing things under provincial requirements for which there are also federal requirements, and there is recognition of that in clause 10, for equivalency to be granted. That's very important, but we're concerned about what equivalency might mean.

I don't think anybody would want equivalency to have to mean you had to do identically the same thing federally and provincially. We think the intention here is to see, if you're meeting the provincial requirement, are you achieving what the federal government intended in performance and intent? And if you are achieving that, then the equivalency provision should be able to apply. We're concerned that without inserting those words, “performance and intent”, to describe what the benchmark is, somebody might look at the provision in terms of looking at requirements for identical provisions.

So the amendment we're suggesting here is one that would be consistent with the intention of the legislation, and it would make it more practical.

Mr. John Herron: Okay, that makes some sense.

Your point number 5 is about the export of hazardous wastes. Instead of phasing out, you want to be reducing the export of hazardous wastes. I'm just going to challenge the question and maybe push the envelope here a little bit. In an industrialized country, as Canada is, and as one of the more affluent countries in the world, shouldn't we be world leaders at looking after our own wastes under our own house?

Mr. Gordon Lloyd: Well, yes.

Mr. John Herron: I'm just trying to push the envelope here.

Mr. Gordon Lloyd: I would agree with that, but we can also expect the Americans to have similarly top-notch facilities. The issue here is if you have similar facilities in, let's say, Buffalo and Swan Hills, and you have some waste in Toronto that you're looking at disposing of, from both an environmental perspective and an economic perspective, it's going to make more sense to be able to dispose of it in Buffalo.

Mr. John Herron: So how about phasing out going to non-industrialized or emerging nations within only OECD?

Mr. Gordon Lloyd: That's what this was put in here for. Within the Basel Convention they have language along those lines, and we would agree that there should be a phasing out if anybody's exporting waste to Nigeria or something like that. I don't think that's what's happening in Canada. That's not what's happening with our membership. But we have a lot of facilities that use the north-south regional agreements we have with the Americans for waste. It's a two-way flow and we want to make sure the legislation here doesn't hinder that.

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Mr. John Herron: Thank you, Mr. Chair.

The Chairman: Thank you.

Now we have Mr. Knutson.

Mr. Gar Knutson: Mr. Lloyd, would it make sense to just treat the U.S. as a domestic market? Would that solve the problem?

Mr. Gordon Lloyd: It would solve the problem if somehow the legislation could be drafted so it was there, but I think the way it reads right now, going to the U.S. would be an export, just as going to Nigeria would be an export. I think you want to make the distinction. It's bang-on that you want to be able to do something to make sure people aren't shipping stuff to a third world country. But as I said, with Canada and the U.S., I don't think we'd want to hinder the solution there.

Mr. Gar Knutson: Mr. Nantais, I wasn't here for the MMT debate. I wasn't on the committee.

Mr. Mark Nantais: Lucky man.

Mr. Gar Knutson: I don't know what role the committee will play in the sulphur debate, but does passing this legislation make it any easier or any more likely we can change the regulations regarding sulphur?

Mr. Mark Nantais: I think it will, but as we pointed out, the wording in Bill C-32 is essentially the same as in the previous bill. We would like to see that wording strengthened along the lines we've recommended so it would be easier and both industries could move forward with greater certainty with their technology plans and their business plans.

Mr. Gar Knutson: I've always been of the mind that Ontario should more or less have the same standards as Michigan or Ohio in the cars that are built in St. Thomas and get driven there. It doesn't make a lot of sense to build one car one way and another car another way out of a plant with a world class mandate. Are we likely to see Michigan and Ohio with higher standards or cleaner gasoline than Ontario or Canada?

Mr. Mark Nantais: Obviously I can't speak for the governments in those jurisdictions, but I think we will and I'll tell you why. We've been promoting sulphur levels of 30 parts per million on average, 80 parts per million maximum, which are essentially the California levels. Those are the levels to which we designed our technology.

Our counterpart organization, the American Automobile Manufacturers Association, has recently come forward specifically asking for those levels now. Previously, when they announced some new technology for the 2001 period, which was the national vehicle emission program, they were not all that specific on the requirements for fuel. But the jury's now in. More testing has been conducted. The results are now available, and they confirm their worst fears. So I think you will see cleaner gasoline in those jurisdictions.

Mr. Gar Knutson: Thanks.

[Translation]

The Chairman: Mr. Charbonneau, please.

Mr. Yvon Charbonneau: Mr. Chairman, first, I'd like to make a comment about the answer given to me earlier by the Canadian Vehicle Manufacturers Association's spokesperson. If he wants to respond to this comment, that's all for the better.

When I asked about gasoline use, he said that the views of the association's members is that they have to go by the consumers' demand and the market. On the issue of tobacco use, in particular, the consensus was not to go by the consumers'demand but, on the contrary, to try to influence the market and reduce the demand for tobacco.

When we talked to the petroleum industry people, they told us that they have to adapt to the engines which are produced. You tell us you have to adapt to the consumers'demand or to the type of gasoline which is produced. We are going in circles. How are we going to get out of this vicious circle? Can you put on the market cars which use less gas and make some real commitments in this regard? It would be a major contribution.

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This is only a comment. It seems to me that we're running in circles.

I also have a question on the part of your brief where you deal with public participation. How can you be in favour of preventive action and, at the same time, ask that the work "may", or "peut" in French, be removed from subsection 22(3), when this word is actually used to prevent offences, situations which could put the environment at risk? Having the word "may" in this provision means that it's possible to check whether there is a need to go further. If you wait until an offence is committed, this is not taking preventive action. It's corrective action.

Why would you insist that the government be a mandatory party in these suits? At the same time, you want to limit federal public resources. I don't really understand why you would insist that the government be a mandatory party in a suit when you also say that we should not adopt a litigation approach. I don't see the logic behind all these recommendations. You want to bar class actions: why?

[English]

Mr. Mark Nantais: I would again like to ask Lisa Kozma to step forward to assist with answering the question on the legal issues here.

The Chairman: It is a policy question.

Ms. Lisa Kozma: Yes, that's correct.

Specifically, though, in terms of dealing with the removal of the word “may”, we're directing our comments with respect to action the court may take. We don't feel it's appropriate for a court to require a business to take specific actions in the event that something may constitute an offence. No offence has been proven, and we feel it's more appropriate for industry to determine a response in consultation with government, but not shift this burden to the courts. So that's the specific answer to “may”.

As we previously mentioned, on the environmental protection actions in general we have significant concerns that we're putting the burden for environmental protection in the wrong arena. It's inappropriate to force the courts to make these decisions, and very costly for business and government, which is why, if this is going to happen, we'd like government to come along with us through this process. We feel it's more appropriate to try to resolve these things outside of the courts. The safeguards that were negotiated in Ontario help to ensure that the majority of issues are addressed outside of the court arena.

I hope I've addressed most of your concerns.

[Translation]

Mr. Yvon Charbonneau: You also mention class actions. You want them barred. You want the government to be a mandatory party in those suits and you want to settle out of court. I find it difficult to understand your logic.

[English]

Ms. Lisa Kozma: The bar to class actions is primarily to limit frivolous complaints. Our view is that this would be one attempt to minimize that type of action, because you wouldn't get a number of minor complainants dealing with that type of issue.

Essentially, we think there is a significant government role in these matters. If a violation occurs the government has a responsibility, which it should not just abdicate to the courts. I'm not necessarily saying these actions would be resolved before they go to court, but hopefully we would be addressing any issues before we go into lengthy court proceedings.

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The Chairman: Merci, Monsieur Charbonneau.

Time is pressing. We have Mr. Pagtakhan, Mr. Gallaway, and then we'll adjourn.

Mr. Rey Pagtakhan: Thank you, Mr. Chair.

It is my understanding that our current judicial system does allow the court to assess costs on the plaintiff in a case clearly deemed frivolous. So I think there is a protection again frivolous cases.

Having said that, in terms of settlement outside of court, part of the concept is the so-called no fault wherein damage has been established and payment has to be made, although there should be no finding of criminal culpability.

Is that something that appeals to the association?

Mr. Gordon Lloyd: I think these actions are all fault based. There's nothing in the bill that—

Mr. Rey Pagtakhan: No, I realize that, but it's the concept of no fault but paying for the damages that I think has been discussed by your group. Do you have any opinion on that?

Mr. Gordon Lloyd: This is another example of where companies will do more under voluntary approaches than they will want to see embedded in legislation. We have member companies that have gone far beyond their legal obligation in cleaning up spills and dealing with a number of environmental issues, such as what we've illustrated here in these charts.

That's kind of what you're talking about there. They're not at fault. If you use the regulations to define a benchmark of what fault is, they're going well beyond that. I think that's a benefit of what you can achieve through a voluntary approach. However, in terms of a legislative approach, I think generally the foundation of our legal system has been that you're liable when you're at fault, and we would not want to see that eroded. We don't see any basis for a change in that area.

Mr. Rey Pagtakhan: My last question, Mr. Chair, relates to the statement that the stated government purpose of environmental protection action is to deal with persistent non-enforcement by government of its legislation, and that it's been used as a basis to include the government as party to the suit.

I'm not on this committee; I'm a substitute. Where is that stated as a provision in the bill itself?

Mr. Gordon Lloyd: That's not in the bill. In the first red book—and I don't have it in front of me, so this is by recollection—I believe that was one of the bases for why the Liberal Party committed itself to introducing this type of environmental protection legislation. They fall—

Mr. Rey Pagtakhan: Let me interrupt you in the interests of time. I get the point.

I would like to make the distinction that you have not made an editorial comment between non-enforcement by government and non-compliance with the law. There is a fundamental difference. The way it is stated, your argument is persuasive, but I'd like to know that the premise for your argument is indeed valid, sound, and correct. That is why I wanted to know whether it indeed says “non-enforcement” or “persistent non-compliance with the law”. There's a hell of a difference.

Mr. Gordon Lloyd: I wouldn't want to bet the house on it without having looked at the red book.

Mr. Rey Pagtakhan: Could you look at it and provide that to the committee?

Mr. Gordon Lloyd: Yes, we will. I believe it says we've quoted it, but I'll take a look and let you know.

Mr. Rey Pagtakhan: Thank you, Mr. Chair.

The Chairman: Mr. Gallaway.

Mr. Roger Gallaway: Thank you, Mr. Chair. I have two brief points, because I know we're under 15 minutes now.

This is with respect to the disposal of hazardous waste and the recognition that the U.S. may be a site for such disposal. The legal counsel for MVMA has raised the whole issue of costs, and I know at least two associations here have raised it.

Mr. Paton, and anyone else who wants to answer, would you be more comfortable if in fact the provision of the act was changed so that the U.S., as suggested by Mr. Knutson, was in fact recognized as a part of the disposal area? I'm not certain what the term is there.

Mr. Richard Paton: The answer is yes. Absolutely. It makes more sense economically and environmentally.

Mr. Bruce Reid: I would certainly concur with that. I think there are facilities in the U.S. to which we could have access for technology that we do not have in Ontario, or indeed in Canada, i.e., for PCBs.

I can also provide an example wherein we had occasion to remediate and decommission some equipment that contained mercury. We were unable to find a reuse for that. In the U.S there was a recycling facility manufacturing products that needed mercury, and we could use it for that purpose as opposed to having to dispose of it in a hazardous landfill, for instance.

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So there are certainly opportunities and technologies available.

Mr. Roger Gallaway: I want to go back to the idea that this legislation as proposed, although not perfect, strikes a balance amongst government, industry, and perhaps the consumer. Obviously cost is of interest to everyone. Certainly if you're in business, more onerous government legislation is costly. Oftentimes I think we should be much more aware of that here. As a result of that, I'd like to ask Mr. Nantais about his suggestion on reformulated fuels.

That's a grand idea, but if we were to adopt California-style reformulated fuels, could you tell us what that would mean to the average consumer in terms of cost increase per litre of gasoline?

Mr. Mark Nantais: The studies that were conducted as part of the recent working group activity on sulphur have set the cost to the consumer at about 1¢ a litre.

Mr. Roger Gallaway: Thank you.

The Chairman: This is very good timing. We have eight minutes left for the vote and enough time to thank you all for appearing here, for your contribution, for your frank answers, and for the help you have given us in understanding better the implications of the bill. We hope to see you again on another occasion.

This meeting is adjourned.