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Proceedings of the Standing Joint Committee on
Scrutiny of Regulations

Issue 2 - Evidence

OTTAWA, Thursday, March 2, 2000

The Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations met this day at 8:35 a.m. for the review of statutory instruments.

Senator Céline Hervieux-Payette and Mr. Gurmant Grewal (Joint Chairmen) in the Chair.


The Joint Chairman (Mr. Grewal): Good morning. I call the meeting to order. We have two agenda items, the budget and the routine review of the statutory instruments.

Mr. Wappel: On a point of order, Mr. Chairman, would you consider adding the RCMP matter to the agenda at the beginning? It is not on the agenda, as far as I can see. Pursuant to a previous resolution, it was supposed to come up every time until it was resolved.

I notice we have correspondence from the Solicitor General. Before we get into the main body of the statutory instruments, I would ask that we deal with that.

The Joint Chairman (Mr. Grewal): From the last meeting, four items on which we should take action have come forward. The first is the budget. The second item is asking the Speaker of the House of Commons to authorize payments if the House prorogues or something like that. We did not deal with that yet. The third item is the fisheries regulations. We were looking forward to a report to disallow them. The fourth item was the RCMP matter and preparation of a report from counsel. When we hear from counsel about their report, we will know how that matter is going.

Mr. Wappel: Mr. Chairman, I am not interested in discussing the report. I should like to discuss something else about that matter.

Mr. François-R. Bernier, General Counsel to the Committee: Mr. Wappel, just before the meeting, Senator Hervieux-Payette let me know that she intends to raise the matter of the letter received from the Solicitor General but that she thought we should wait for Mr. Lee to be here. Is that agreeable?

Mr. Wappel: I was not aware of that. If that is the case, I am happy with that.

The Joint Chairman (Mr. Grewal): Let us go now to the budget. I hope everyone has a copy of it. It is open for debate.

The Joint Chairman (Senator Hervieux-Payette): Perhaps we could have some explanation of possible changes from the clerk.

The Joint Chairman (Mr. Grewal): If we compare it to the last budget, there is one major change, which is payments to the Library of Parliament for legal counsel. I see an increase there. I do not see increases anywhere else. Does anyone wish to explain?

Ms Jill Anne Joseph, Joint Clerk of the Committee: The reason for that is that their collective agreement is up for renegotiation as of April 1, I understand, and there is the possibility of an increase in salary. I have added 3 per cent there. Also, one of the lawyers will be moving up one step in their pay scale. There is an increase only in that line; all other lines have been left the same.

The Joint Chairman (Senator Hervieux-Payette): With no indexation, whatsoever.

The Joint Clerk (Ms Joseph): No, and I think that is the last time we can do that. That might be cutting it a bit close to the wire.

Senator Finestone: You put a 3 per cent salary increase in here. Is this salary commensurate with the salary being paid out of the Ministry of Justice?

Mr. Bernier: Not quite.

Senator Finestone: I want to know why it is not, Madam Chair.

Mr. Bernier: With respect to the classifications for all four of us, two positions are reimbursed by the committee to the research branch of the Library of Parliament, and two of the staff are furnished to the committee by the research branch, for a total of four legal staff. The classification for all four positions is RO, research officer. In the research branch of parliament and the law and government division, the RO classification has never been anywhere close to the Department of Justice's LA classification for lawyers. Given that we are classified as ROs, the salary goes with that classification.

Senator Finestone: You are all lawyers, the four of you?

Mr. Bernier: I am not a member of the bar, so technically I should not say I am a lawyer. I am trained in law. I have a Master's of Law degree, but I am not a member of the bar. The other three are members of the bar.

The Joint Chairman (Mr. Grewal): As I understand counsel, these payments are for two lawyers?

Mr. Bernier: Yes, for two.

The Joint Chairman (Mr. Grewal): Are there any other questions?

Shall we put the budget to a vote?

Mr. Rocheleau: I would like a recorded vote.

The Joint Clerk (Ms Joseph): As there is a request for a recorded vote, I will begin with the senators.

Senator Cochrane.

Senator Cochrane: Yes, the budget gets my vote.

The Joint Clerk (Ms Joseph): Senator Finestone.

Senator Finestone: Yes.

The Joint Clerk (Ms Joseph): Senator Grimard.

Senator Grimard: Yes.

The Joint Clerk (Ms Joseph): Senator Hervieux-Payette.

The Joint Chairman (Senator Hervieux-Payette): Yes.

The Joint Clerk (Ms Joseph): Senator Moore.

Senator Moore: Yes.

Mr. Normand Radford, Joint Clerk of the Committee: I will call the vote for the members of the House of Commons.

Mr. Assad.

Mr. Saada: I am Mr. Saada, and I vote yes.

The Joint Clerk (Mr. Radford): Mr. DeVillers.

Mr. DeVillers: Yes.

The Joint Clerk (Mr. Radford): Mr. Murray.

Mr. Murray: Yes.

The Joint Clerk (Mr. Radford): Mr. Pillitteri.

Mr. Pillitteri: Yes.

The Joint Clerk (Mr. Radford): Mr. Rocheleau.

Mr. Rocheleau: No.

The Joint Clerk (Mr. Radford): Mr. Wappel.

Mr. Wappel: Yes.

The Joint Clerk (Ms Joseph): Mr. Chairman, there are ten votes for and one vote against the motion to approve the budget.

The Joint Chairman (Mr. Grewal): I declare the motion carried.


The Joint Chairman (Mr. Grewal): Our next item of business is the government response to the sixth report of the joint committee, Report No. 65 -- Indian Act.

Mr. Bernier: The sixth report, Mr. Chairman, dealt with four separate issues. I intend to deal with each of them in turn.

On the Stuart-Trembleur Lake Band Timber Regulations, the report summarized the lack of progress in terms of making promised regulatory and statutory amendments and stated the committee's view that the government should amend the regulations without further delay so as to bring their provisions in accord with current statutory authority.

In its response, the government undertakes to process new regulations that will not include those provisions that the committee considers to be unauthorized. Instead, those provisions will be included as terms and conditions of licences. If that is done, the committee will be in a position to close its file on the matter. So the progress of these new regulations will now have to be followed up.

The second item raised in the report concerns the lack of progress made in implementing the measures promised by the government in reply to the joint committee's report No. 39 of March 1987. The specific recommendations of the committee are listed on page 4 of the report. In terms of progress, on recommendations one to three, all of which relate to the bylaw-making process, the government response gives no concrete indication of progress, unfortunately. In regard to recommendation number four, a number of measures have been taken by the department, including the preparation of a handbook on bylaw drafting, which has been distributed as part of the material to members.

The recommendation that called for the tabling of the disallowance policy of the department in the House of Commons, and its referral to the appropriate committee of both Houses, has not been dealt with in the government response. It is clear at this stage that there is no intention to refer that policy to the appropriate parliamentary committees as recommended by the committee.

Finally, the fifth recommendation dealt with the enforceability of certain membership rules and certain intoxicant bylaws that were enacted without respecting the requirements of the Statutory Instruments Act.

As regards the intoxicant bylaws, the department has chosen the approach of asking the band councils involved to re-enact their bylaws. That is fine and it is a workable approach. However, at this stage there remain 37 of those bylaws to be re-enacted, some 13 years after the problem was identified. I do ask myself whether it would not be simpler to introduce a bill deeming the requirements to have been complied with. At the very least, the minister should be asked exactly when he intends or forecasts that the remaining 37 bylaws will be re-enacted by the band councils involved.

In the government's response regarding membership rules, we now have a totally new assertion to the effect that failure to observe the requirements of the SIA in that case does not affect the enforceability of the rules. It is now claimed that it was always the view of the government that the 85 rules concerned were in force, despite the failure to comply with the Statutory Instruments Act. However, this is the first time that this committee has been informed of that position.

The fact is that there is really no incompatibility between the SIA and section 10 of the Indian Act. It is difficult to conceive that the Statutory Instruments Act would apply -- and the government accepts that -- but there would be no consequence for the failure to follow its requirements. It is very nice for the government response to speak of restorative goals. There is also reference to centuries of federal erosion of Indian band powers and to membership rules being self-contained and autonomous, as well as the nominal applicability of the Statutory Instruments Act. All this jargon, unfortunately, seems to have little to do with the law and the legal issue.

The response recognizes that the SIA applied to those 85 rules and that the law was not followed. Yet, at the same time, it claims that there were no consequences from that failure to follow the act. This is a new issue. It is the first time this claim by the government has been put to the committee. I think that the joint chairmen will have to deal with it in a letter to the minister.

Turning to item three of the report, that portion of the report dealt with the lack of progress in validating some legal proclamations reported on in committee report No. 40 in October of 1987. Once again, this is being wrapped up in broader issues flowing from the Supreme Court decision in the Corbière case. This is not a concern of the committee. The narrow concern of the committee is simply that legislation be passed to validate passed proclamations. The required remedy is nowhere in sight. I do not know how the committee wishes to proceed on that item.

The last item dealt with in the report concerns the validity of section 14 of the Indian Estates Regulations. That section purports to authorize the minister to grant dispensation from the relevant provisions of the act by deeming certain persons to be widows. The committee is of the view this regulation is illegal. The government acknowledges only that it is "vulnerable to legal challenge." Nevertheless, the response states that pending a legislative solution, the government will suspend the practice of issuing these deeming orders. The response goes on to state that "the Government will address the entitlement of common law spouses administratively in conformity with the Charter." No detail is given as to what is meant by that and it is suggested that an explanation must be sought.

As a postscript, I might add that the response makes much of the fact that section 14 has not been declared to be invalid by the courts. Curiously, though, the same government has no qualms assuming that section 48 of the act, which restricts the descent of property to widows, is contrary to the charter and unconstitutional, although no court has declared section 48 to be unconstitutional. If the government feels that section 48 is unconstitutional, the proper approach does not lie in ignoring it or in passing illegal regulations; it lies in proposing amending legislation to Parliament.

Senator Finestone: I have a point of information, Madam Chair. How do the changes that have recently been made in legislation with respect to common-law and same-sex relationships, and the consequent changes in the financing of common-law and same-sex widows and widowers, affect this particular section 14 or section 48? I may have misinterpreted or misread, but it would seem that you have left out the question of the state of widowhood, be it from a common-law relationship or from a married relationship. There is a potential for impact on the financial well-being of the surviving spouse from a conjugal relationship of any kind. What happens to those children? Has it gone through yet? I do not know how it relates to this.

Mr. Bernier: If you are referring to the recent government legislation, I would doubt that it deals with these provisions of the Indian Act. I think the government would probably prefer to deal with those separately, again after consultation with native people.

From a policy point of view, there can be no doubt that a provision that restricts descent of property to widows in the traditional sense -- that is, to the surviving married spouse -- is outdated and not in keeping with contemporary practice or policy. The committee has never denied that, of course. The committee is saying that, if section 48 of the act is out of step with current standards or policy or current public opinion, the proper approach is for the government to propose an amendment to Parliament and have Parliament change the section, not to adopt a regulation for which you have no authority and in which you purport to give the minister a power to deem common-law spouses to be widows for the purposes of the act. That is a significant power. It amounts to the minister amending the act every time he issues a deeming order.

If we want to talk about justice, we must also keep in mind the fact that there will be cases where there is both a widow in the traditional sense and a common-law spouse. One such case was drawn to the attention of the committee. When the minister deems the common-law spouse to be the widow for purposes of the act, unlawful as that may be, that other person is then deprived of an inheritance that she otherwise would have had. That is not dealt with by the minister. Presumably Parliament, if it addressed or revised section 48, would deal with those situations.

I am somewhat disturbed by this reference to addressing the entitlement of common-law spouses administratively in conformity with the Charter. It almost sounds to me as if the minister is saying, "I will not issue deeming orders under section 14 of the regulations, recognizing its dubious validity, but I will practically continue to do the same thing as a matter of administration." That is not much better, is it? I think that point should be clarified.

Mr. Wappel: I have a question and then a comment. I am referring now to the aspect of widows, not the other three parts, which I will address later. Am I correct in assuming that section 48 provides a result that is not the case for non-aboriginal widows? If I understand this correctly, in the event of intestacy, a legal widow inherits pursuant to statute. However, that is not the case under section 48, is that right?

Mr. Bernier: I am not an estate lawyer, Mr. Wappel. All I can tell you is that section 48 enacts that the property of an Indian who dies intestate is divided between his issue, if any, and the widow.

The Joint Chairman (Mr. Grewal): I think, Mr. Wappel, your assumption is right. This problem was also inherent in the Nisga'a treaty and we debated it during those discussions as well.

Mr. Wappel: My point is that the aboriginal peoples apparently see this in a different way. The law that would normally apply to non-aboriginal peoples is different from that in section 48.

The minister, throughout this document, has indicated the sensitive nature of the discussions between the government and the aboriginal peoples. It is, of course, absolutely true that Parliament can at any time issue any statute it wishes to issue, provided it is constitutionally valid. However, there are larger political issues, as I am sure we all realize, with the aboriginal peoples. The government is reluctant to force something -- I am reading through the minister's response -- onto the aboriginal peoples.

The problem is that, with well over 100 bands around the country, the minister will never get the consensus he keeps mentioning. In my view, he will be dead before consensus occurs on anything. That is just the nature of the situation when you have 150 band councils across Canada with all kinds of different traditions, from east to west and north to south.

We issued a report and asked for a response. We received the response. So what? What else can we do? Assuming this is it, that there is no movement from this position by the government, what else can this committee do besides write letters? Writing letters will accomplish nothing. It is that simple. The minister will look for consensus, as previous ministers have. Numerous acts, as he points out, have come to Parliament and have failed for a variety of reasons, notwithstanding who was in government. So writing letters will do nothing, with the possible exception of obtaining clarification of what you said there.

Do we have any other option after we have received this report? That is my question.

Mr. Bernier: Mr. Wappel, it we are still talking specifically about --

Mr. Wappel: I refer to any of the four, Mr. Bernier.

Mr. Bernier: I do not believe they are all in the same class.

Mr. Wappel: I am sure they are not.

Mr. Bernier: I will deal with section 14 first with regards to widows. The response is in fact satisfactory from the committee's point of view because we have the minister agreeing not to issue further orders. He will no longer rely on the provision that we say is illegal.

Senator Finestone: That was my question, Mr. Bernier. He said he will not do it anymore. What happens to those women, whatever category they are in? What happens to the estate and to their children?

Mr. Bernier: They will be dealt with administratively in conformity with the Charter, which is why I suggested that we seek clarification of exactly what the minister and the department intend to do.

Mr. Wappel: That is my point. A band exists in a province. It does not exist out in the air. If there is no law dealing with intestacy, one presumes the law of intestacy is that found in the laws of the province. That law applies to all people in the province, including aboriginals. If it does not, then, as Senator Finestone quite rightly pointed out in her question, we have a legal vacuum about what happens to widows of intestates unless, as the letter puts it, administrative procedures will be put in place by the minister, which is, in effect, section 48 without section 48.

Mr. Bernier: Mr. Wappel, we do have a law in place. The minister is saying that he will not deem persons to be that which they are not under the statute.

Section 48 of the statute is still there. It is the law. It has not been declared unconstitutional by the courts. It could well be, but it has not been so declared. Until it is, it is still the law. The law provides that where an Indian dies intestate, the property is divided between his issue and his widow.

Mr. Wappel: Should the minister have stopped at "I will not continue to issue certificates"?

Mr. Bernier: That would have been reassuring. He did go on, however, to refer to taking some other measures. You have to wonder whether his intention is other than simply to apply section 48 as enacted by Parliament.

Mr. Wappel: Exactly.

Mr. Bernier: We must find out how he proposes to ignore section 48, if that is what he proposes to do.

Mr. Wappel: What happens on the other ones?

Mr. Bernier: On the other ones, you are dead right; on many of those, we will all be dead, unfortunately, before anything is done.

Mr. Wappel: Given that, can we do anything? Can we disallow any of these regulations?

The Joint Chairman (Senator Hervieux-Payette): Yes, we can, but we have to explain.

The Joint Chairman (Mr. Grewal): Moreover, does section 48 violate the Charter of Rights and Freedoms? Am I right in assuming that?

Mr. Bernier: It could. I suspect it probably would be held to contravene the Charter, but that is a section of the statute, so the committee certainly cannot meddle. We are a committee of Parliament and this is an act of Parliament. We deem it to be valid in this committee.

The Joint Chairman (Mr. Grewal): I think I heard you say that section 48 violates the Charter of Rights and Freedoms; is that correct?

Mr. Bernier: There is a good chance that it would be held by a court to violate the Charter of Rights and Freedoms.

The Joint Chairman (Mr. Grewal): Does section 14 fall there as well?

Mr. Bernier: No. Section 14 is simply ultra vires. It is illegal. There was no authority in the act of Parliament to make that section.

The Joint Chairman (Mr. Grewal): Because of those two important things, possibly the optimum solution for us is to disallow.

Mr. Bernier: We certainly cannot disallow a section of an act of Parliament.

The Joint Chairman (Mr. Grewal): I refer to the whole regulation.

Mr. Bernier: Section 14, I suppose, could be disallowed. Is it worth going to the trouble when the government has confirmed in a response that they will not use the section? I would think that that is satisfactory as an interim solution. I am not sure what more would be achieved.

The Joint Chairman (Mr. Grewal): We are not really sure that the minister has written clearly that he will not use section 48. Where is it? Can you point to it?

Mr. Bernier: I refer to the last page of the government's response, Mr. Chairman, at page 11:

Pending legislative change regarding the entitlements of surviving common law and potentially other partners... it is the Government's intention to suspend the practice of making deeming orders under section 14.

Mr. Wappel: Mr. Chairman, does counsel read that it is the government's intention to suspend the practice as the government will not issue further deeming orders under section 14? Is that how you read it?

Mr. Bernier: That is the way I would read that. I think it is the only way to read it.

Mr. Wappel: It can be read another way. That may be the government's intention, but it has not implemented its intention. I do not see a promise; I see an intention.

Mr. Bernier: A strict legal mind is at work. That probably could be confirmed with the minister by asking if he will go past mere intention and actually confirm.

Mr. Wappel: He should confirm that no further orders will be issued.

Mr. Bernier: To come back to the other parts of your question, Mr. Wappel, on the Stuart-Trembleur timber, we do have progress. That is fine.

The other core matters are the follow-ups on report No. 40 and report No. 39 of the committee. These require legislative action. There is really nothing to disallow except, I suppose, the invalid proclamation, but that would not be advisable. It would wreak havoc with elections within Indian bands, because those proclamations were designed to allow off-reserve members to vote in band elections. It would be an irresponsible use of disallowance. That is my opinion.

One could wait for legislation, as you say, but these consultations constitute a very vibrant industry.

The Joint Chairman (Senator Hervieux-Payette): That is a new avenue for lawyers.

Mr. Wappel: Where does that leave us, then?

The Joint Chairman (Senator Hervieux-Payette): We have recommendations for the four items. Perhaps the members could indicate where they would like to go with regard to the recommendations of legal counsel.

Mr. Grewal, did you have some questions?

The Joint Chairman (Mr. Grewal): Not at this time.

The Joint Chairman (Senator Hervieux-Payette): We need to go through the other items on the agenda, otherwise we will never finish today.

Senator Finestone: Madam Chair, we must ensure that the widows, the common-law wives and the children are looked after. I do not care what section it is under, so long as they are looked after and there is clarity as to their rights.

I should like to understand at some future point how we interact with the provincial law and the Indian law. The entire matter is a large problem and has been for 100-odd years. I do not know how it will be resolved, but I want to ensure that everybody is happy under what is happening right now.

The Joint Chairman (Senator Hervieux-Payette): As Mr. Wappel was saying, perhaps the government's intention may not be strong enough. Intention means something that is not very firm. Perhaps we could get a letter from the minister saying that he will continue this practice.

Mr. Bernier: If we ask the minister to continue the practice, we are condoning an illegal practice. Perhaps that suggestion should be left to other people, not this committee, of all committees.

The Joint Chairman (Mr. Grewal): How do we conclude?

Mr. Bernier: Progress is satisfactory. There is progress on the timber regulations. On the widows, section 14 of the Indian Estates Regulations, a letter will go to the minister seeking clarification of this reference to the administrative process and seeking confirmation as well that the intention to suspend means they will actually suspend the practice.

Mr. Wappel: Have actually suspended it.

Mr. Bernier: Yes, have actually suspended it.

On the first of the committee's reports, this has really bogged down and all we can do is monitor the file and keep bringing it up from time to time.

On the validation of illegal proclamations, there is possibly something a little more concrete that can be done. For example, one could have a private member's bill. It is a simple matter to validate illegal instruments. The applicable law reads that the instruments listed in the schedule shall be deemed to have been validly made.

It is somewhat unsatisfactory because, as I say, those proclamations allow off-reserve members to vote on reserve. That is illegal. What is the impact in terms of elections that have been taking place under these illegal proclamations where people that legally should not be entitled to vote are voting? That is a significant issue. To just let it drift until we have all consulted the very life out of the issue is not really satisfactory. There should be more of a sense of the importance on the government's part of getting this cleaned up.

Frankly, I do not see why it would involve so much consultation with Indian bands. The Indian bands concerned requested those proclamations. By validating those proclamations, all the government is doing is giving effect to the wishes of the particular Indian band. It affects and is of concern to no one but those 77 bands. You are validating. In other words, you are confirming what was the wish of those bands. I am not sure why that cannot be done without the agreement of all native organizations, et cetera. I presume the bands concerned would be happy to have the proclamations validated.

The Joint Chairman (Senator Hervieux-Payette): There is a parallel to people living abroad and being given the right to vote or not. In Quebec, in the last referendum, I know that there were many people in Florida who had the right to vote but who were not necessarily in Quebec at the time.

Residence is a concept in law. Domicile is the one that is a fiction of the mind. I am domiciled in Quebec in order to be a senator, but I could have a residence here in Ottawa. There are two legal distinctions.

It does not bother me that off-reserve members have the right to vote if they consider that they are attached and their domicile is on the reservation but they can reside in Winnipeg or anywhere else. The band is giving them that right and I do not see anything abnormal about that.

The Joint Chairman (Mr. Grewal): In my opinion, I think the committee should not depend on private members' bills. That is the least efficient tool members have in Parliament and we should not depend on that. We should have another alternative.

Mr. Bernier: The alternative, Mr. Chairman, would be to write to the minister, set out some of the factors I just mentioned before him, and renew the request that the government introduce discrete legislation that is not part of a broad reform package in order to deal specifically with validation.

Mr. Wappel: On page 7 of the government's response, the government rejects the committee's analysis. As I read it, the government has considered the committee's analysis with respect to the membership rules and has rejected it and has stated at the bottom of page 7 that the Indian Act provides a method for looking after this. They do not accept that something needs to be validated, because they consider it to be valid. A letter reiterating our position is useless since they have already looked at it. That is why I asked if there is anything else we can do. You said we could disallow, but that would cause disarray because it would bring into question the validity of numerous elections that have taken place under these provisions.

We are at an impasse. We do not want to disallow something and thereby cause major disarray on past elections. On the other hand, the government does not accept our point of view and indicates that, in their view, it is perfectly valid. I do not see any purpose in further correspondence on this issue. We cannot force the government to bring in legislation.

Mr. Bernier: Mr. Chairman, I hate to do this, but, Mr. Wappel, you are dealing with the wrong report. Those are membership rules. We are dealing with proclamations, page 8. Mr. Wappel was looking at the new government argument on membership rules, which I referred to earlier, at page 7. We deal with those proclamations and with extending voting rights to off-reserve people at page 8.

Mr. Wappel: Joint committee recommendation No. 3 -- is that what we are talking about?

Mr. Bernier: Yes. I would say that the government has never stated in so many words that it accepts the committee's position that these were illegal. That would still be correct. However, it agreed at the time to suspend the issue of any further proclamations. As far as I am concerned, that is as good as saying the committee was right, but they will not say that.

The Joint Chairman (Mr. Grewal): I agree with Mr. Wappel that we must choose between doing the right thing and causing disarray. The committee has a moral responsibility to do the right thing and not bother about the disarray it will cause.

Senator Finestone: Do we say that while we do not like it, we have to swallow it?

The Joint Chairman (Mr. Grewal): If we do not like it and if, in the committee's opinion, no progress is expected, disallowing it would be better than letting the problem continue without finding any solution to it.

Mr. Wappel: Mr. Chairman, I am obviously confused, because I quoted from the wrong page. Could counsel go through each of the four areas of concern and clearly state a recommendation? For example, "Recommendation No. 1, nothing further needs to be done. Recommendation No. 2, here are the options the committee could consider. Recommendation No. 3, do nothing. Recommendation No. 4, get clarification." Could you do that for us, counsel? Obviously, I am jumping around here.

Mr. Bernier: Concerning recommendation No. 1, as I have said, Mr. Wappel, I believe there has been progress on this file and new regulations will be made. It is a matter of following up on that.

With regard to recommendation No. 2, there are different things lumped together. By and large, at page 3, what you were saying applies to that recommendation. It is consultation, consultation, consultation. I cannot think of any practical thing this committee can do other than follow up and, from time to time, remind whoever happens to be the Minister of Indian Affairs that those reports are there and they are outstanding.

Concerning recommendation No. 3, I was seeking the direction of the committee on how to proceed because, with the nature of the issue raised there, there is still some room to, perhaps, convince the minister that he can actually introduce a validating bill without risking a general uprising on reserves and elsewhere. I would suggest that that be tried.

We have dealt with recommendation No. 4, regarding the Indian Estates Regulations, at length. We would then write to the minister to deal with the points that have been discussed.

Mr. Wappel: May I suggest that we proceed on those items as just outlined by counsel?

The Joint Chairman (Senator Hervieux-Payette): Is it agreed?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Let us now take a detour and deal with the RCMP issues.

The Joint Chairman (Senator Hervieux-Payette): We have received correspondence from the minister, and more detailed correspondence was sent to the general counsel of the committee. Perhaps you could give us a summary, Mr. Bernier, so that everyone can share the information.

Mr. Bernier: A letter has been received from the Solicitor General. In that letter, the Solicitor General refers to the September draft having been reviewed and he expresses his view that, as a result of consultation on the September draft, the January draft represents a more permissive regulatory framework for members of the RCMP.

I also received a phone call from Mr. Paul Dubrule, senior counsel at the department. As far as I was concerned, it was an informal phone call in which I quickly reviewed the main issues we thought existed in the draft. I was surprised, two days later, to receive a formal response based on that conversation, dated February 25. I indicated to Mr. Dubrule, both orally and in writing, that I took exception to what I considered an informal conversation being turned into part of a formal process. If Mr. Dubrule had indicated that he wanted the formal views of counsel to the committee, I would not have accepted to discuss them over the telephone. That is not the way to deal with that kind of issue.

That being said, we had a draft in September that was quite acceptable. Counsel made some observations on it. It was then also made the subject of consultations with members of the RCMP. In January, some four months later, we received another draft. According the commissioner, it was said to contain additional improvements flowing from that consultation process with members and observations from counsel. We now also have the Solicitor General referring to the draft as an improvement.

In dealing with this, Madam Chair, we have slowly come to the view that the commissioner and the Solicitor General are acting in good faith and, in good faith, probably do not understand the fundamental shift in terms of underlying policy that exists between the September draft and the January draft, because it has not been explained to them. I will go as far as saying that it is almost certain they were not given the correct information, which is why, in the mind of both the commissioner and the Solicitor General, the January draft is simply an improved September draft. However, the policy reflected in those documents is not the same at all. There was a fundamental shift.

The changes that were brought to the September draft included changes requested by members and some changes flowing from counsel's observations in the September draft. However, that is not all they do. Some other changes have been bootlegged in there. They are not mentioned anywhere. We have a copy here of an internal memorandum, from the head of the internal affairs branch, describing the January draft. It simply presents this draft as being the September draft with the addition of what members wanted to be put in and some observations of counsel.

The January draft goes much further. If that were all that was involved -- and I discussed this yesterday with my colleague, Peter Bernhardt -- we could take the September draft and add the amendments requested by members and some changes to reflect the committee's concerns and have a perfectly acceptable draft. However, something else has taken place.

In September, you had a whole range of political activities that were simply permitted. The regulations simply provided that a member, as a peace officer, may, while off duty and not in uniform, engage in political activity, subject only to the general obligation under section 36 to conduct himself in public in relation to any political issue, party, candidate or election so that impartiality in the performance of his duty is not affected and does not appear to be affected. That was the only limitation; members may engage in political activities subject to that conduct requirement. In a second stage, the regulation identified some primary political activities, such as running as a candidate and fundraising, which required a member to take leave of absence with pay. That is fine.

If we go to January, all those secondary activities that a member could engage in under the September draft, subject only to his obligation to maintain the appearance of impartiality set out in section 56, may now be made subject to a requirement to take leave. Again, that is a fundamental shift in the underlying policy. At this stage, the issue is a policy/political issue.

One must find out what happened between September and January. In September the commissioner communicated a draft to this committee that reflected, I presume, a policy with which he was happy and with which his superior, the Solicitor General, was happy. What happened in those four months to make the policy as reflected in that draft suddenly no longer acceptable?

The best way I have found to describe the January draft is to say it is SOR/99-26 in sheep's clothing. The aim is the same. I have six pages of notes here on other differences between the drafts. I do not want to go into them now.

The Joint Chairman (Mr. Grewal): May we have copies of those notes?

Mr. Bernier: They will have to be cleaned up, Mr. Chairman, but eventually, yes, they are intended for use by the committee.

Senator Finestone: You have done a comparison between the two, is that right?

Mr. Bernier: Yes. This explains the extent to which there has been a shift here. I have questioned whether the commissioner and the minister are aware of that shift. In this internal memorandum, the shift I have described is clearly not referenced. The change is simply identified as something that committee members wanted. Frankly, the same memo states that counsel to the committee have no problem with the January draft. That memo was written four days before the joint chairmen even received the January draft. I certainly had not seen it. Seeing that in a memo makes me question whether the commissioner was given that same information that counsel was agreeable to that draft, which, I am sorry to say, is an outright lie.

Mr. Wappel: Madam Chair, we have two situations here. First, we have a set of regulations currently on the books that this committee believes are improper. Counsel have been instructed to prepare a disallowance report, as I understand it.

Second, we then have a set of proposed regulations. We are attempting with those regulations, probably for the first time, to do in advance what we usually do in arrears. We are trying to clean up the regulations so that, by the time they get to us, they will simply be listed as regulations without comment.

I found Mr. Bernier's final response of March 1, 2000 amusing because he is usually unflappable. This time he flapped.

Having said that, the answer to his question about what happened is that senior management, not members of the force, got a hold of the regulations. They saw a whole lot of problems on a detachment-by-detachment basis. They gave their opinion to the commissioner, who then gave it to the working group, who then revised their views.

We already have a disallowance report coming to this committee. If we disallow those regulations and that is confirmed by the House, then the commissioner will immediately put in whatever regulations are ready at the time to prevent any vacuum, I presume. Then we will be back here discussing this again.

Mr. Lee was very successful, or so we thought, in meeting with the commissioner in the summertime. You seem to feel, Mr. Bernier, in the words of the old movie Cool Hand Luke, that there has been a failure to communicate. At the very least, there has been some miscommunication. Would Mr. Lee -- and I have some indication that he would -- be amenable to representing this committee at a further meeting with the working group and/or the commissioner and/or the Solicitor General and/or the parliamentary secretary and/or the senior management, with a view to communicating to them what we find troubling about the January version of events? Perhaps there can be some bridging of the gap.

We must understand that this matter has nothing to do with the current regulations. We already agree those should be disallowed, I presume, since we have instructed the preparation of a disallowance report. I presume we are considering disallowance and not simply making work for counsel who have plenty of work.

If Mr. Lee agrees to be our envoy at a further meeting, counsel's notes, as referenced, should be cleaned up and given to Mr. Lee. Mr. Lee can invite anyone to attend with him, including Mr. Bernier and Mr. Bernhardt. Let us see if we can bridge the gap.

If not, it is ultimately the decision of the commissioner and the Solicitor General which regulations they wish to bring forward. When they do that, the regulations will come back here and, if we do not like them, we will repeat these discussions. Maybe we will disallow them again. That is my recommendation.

The Joint Chairman (Mr. Grewal): Do you suggest any time frame?

The Joint Chairman (Senator Hervieux-Payette): May I give you some more information? It does not seem that the gap is very big. We knew what we wanted in September and we were in agreement then. There may be a reconciliation of our points of view.

Legal counsel told me that the disallowance report is awaiting translation and will be ready for the next committee meeting. Hopefully Mr. Lee has a little spare time in the coming week. It should not take ten meetings to resolve this. If we arrive at the next meeting and receive assurances that replacement regulations will be tabled shortly, then we can just suspend the adoption of the report for one meeting.

I do not think we should go any further. In that two-week window of opportunity, we can review it and try to reconcile our views with the political authority of the ministry. Mr. Lee can act as our envoy. The time frame of two weeks is something we can manage, providing there is goodwill on the other side.

Do you agree, Mr. Lee?

Mr. Lee: I do not have a problem with anything that has been said except that I do have a serious time problem over the next two weeks. My own personal ability to complete this over the next two weeks is non-existent. I could not spend any time on this until the house resumes after the one-week break. That would not give us much time before the next meeting. If members can bear with that time element, I would be happy to do it.

It is my perception, as has been expressed here, that the minister and the commissioner and others in the loop are proceeding in good faith to try to bridge the gap. We do get tangled up in some of the weeds. This committee has clearly labelled certain changes as being substantial in relation to Charter rights. I am beginning to suspect that those who urged the most recent changes regard those changes as procedural or minor changes.

If we look back at the September draft, as Mr. Bernier has pointed out, it says that the officers out of uniform can be active politically, but there is a subject-to clause that we all agree seems like a reasonable statement. The only difficulty is that if there is a need to use the subject-to clause, there is no procedure that goes with it in the regulations. I am beginning to suspect that what was placed back into the regulations in January is a procedure to accompany the subject-to provisions, and my perception is that that is a substantial retraction of what had earlier been extended as rights, whereas the force may view it only as the providing of a procedure to deal with the subject-to problem. I do not know that for sure. Maybe I am being too generous, but I think we are very close on this and it would be useful to engage in some serious discussion on the matter.

Mr. Saada: First, perhaps I should remind myself of the role of a parliamentary secretary: to arrange good communications between the Solicitor General and the parliamentarians. That is my first role. In that regard, I would certainly welcome the proposal that Mr. Wappel is making.

In terms of timing, one of the only reasons I was assigned to this committee, given my job on other committees, was the RCMP regulations. Over the last two years I have seen that these regulations have been going on and on, back and forth, and they are not settled. Even though there has been some progress, it is always accompanied by some backlash, and so on.

I believe that everybody is acting in good faith in this regard. I believe that we are lucky to have the quality of counsel we have here. We are also lucky to have people like Mr. Lee who is willing to help us out yet again.

I suggest that we should not be blocked by the time concept, providing it is reasonable. The cost of not having an extra two weeks might be an extra two years. Why not be reasonable, go through this process; and I would certainly suggest that we follow the schedule that Mr. Lee is able to follow. I think there are ways to resolve these issues that are far more beneficial to every one and far more constructive than the disallowance. I would invite the committee to follow that route.

The Joint Chairman (Senator Hervieux-Payette): Do we need a formal resolution?

Mr. Bernier: No, we do not need a formal resolution.

The Joint Chairman (Senator Hervieux-Payette): I would just express our thanks to the person doing some volunteer work on our behalf and say that we expect a report on this not at the next meeting but the meeting after that.

Mr. Lee: Just to clarify for committee and counsel, one of our counsel will be able to accompany me in the process; is that okay?

The Joint Chairman (Senator Hervieux-Payette): Yes.

Mr. Saada: If I may, in this regard, I should like to mention that unless it is really deemed necessary, I do not wish to sit at these meetings because the issue is of a technical nature. If I can be of any assistance to the committee in terms of facilitating things in political terms, I will be more than happy to do it.

The Joint Chairman (Senator Hervieux-Payette): Just ensure that everyone is around the table when we want to meet and try to accommodate Mr. Lee and we will be happy.

The Joint Chairman (Mr. Grewal): I suggest that Mr. Lee send a brief memo to all members, and if any member wishes to be present that would be beneficial.

The Joint Chairman (Senator Hervieux-Payette): Is it agreed?

Hon. Members: Agreed.




Mr. Bernier: Various issues in relation to these files, Mr. Chairman, are laid out in the February 3 letter from the Chair.

Before asking the clerk to arrange for the appearance of the minister, I thought I should seek confirmation by the new committee that it wishes to hear the Minister of Transport in relation to these matters. The decision to ask the minister to appear had really been made in the last Parliament by the previous committee.

It is a question of refreshing that mandate, if it is still there. At the end of the letter, it was stated that once the new committee resumed meeting in the new Parliament, the clerk of the committee would contact the minister's office and ascertain his availability to meet with the joint committee.

The Joint Chairman (Mr. Grewal): Do you mean that we should extend the invitation?

Mr. Bernier: Does this committee still wish to hear from the Minister of Transport?

Mr. Wappel: Madam Chair, I think we should schedule an appearance.

The Joint Chairman (Senator Hervieux-Payette): Is it agreed that we send the letter of invitation?

Hon. Members: Agreed.


Mr. Bernier: The correspondence is before the committee for information, Mr. Chairman.

Mr. Wappel: Mr. Bernier, will you be monitoring whatever they come up with to ensure that the sailing school is dealt with in the letters patent? Is that your job?

Mr. Bernier: I have not received instructions to do so. The concern of the committee was with regard to legality. If the minister preparing letters patent wishes to authorize Hamilton Harbour to run their sailing school, that will be that.

This matter is before the committee for information. I do not think there is anything further to be done, Mr. Chairman.


Mr. Bernier: Members have before them the government's response to Report No. 64 concerning the payment branch line subsidies to CN in relation to the Chandler Subdivision. I point out in passing that the response was not tabled within the time required by the Standing Orders of the House of Commons.

Judging by the response, Mr. Chairman, I guess the cynical comment would be that the committee could have spared a few trees and not bothered with a reasoned analysis of the respective positions and arguments of the committee and the Department of Transport in this file. It seems the Department of Transport, at any rate, could not be troubled to read the actual report and simply repeated its previous position in the response.

The key provision of the act involves section 178. In a nutshell, subsidies could only be paid under that legislation, which is now repealed, in respect of a claim period. Section 178 prescribed how a claim period was established. It clearly provided that for a claim period to exist, a date had to be fixed for the commencement of that period and a date had to be fixed for the end of that period.

In the case of these subsidies, however, the government has stated that the claim period existed even if no date had been fixed for the end of the period. While the government has repeatedly asserted that the order authorizing the payment of subsidies, which total some $3 million, was consistent with both the letter and the spirit of the legislation, it has also failed consistently to identify the words of section 178 which support its position. It has failed to do so again in the response to this report, although the report made it abundantly clear that this was the central issue that had to be addressed by the government.

On that basis, I think one could say that this is not really a comprehensive government response. It is a response, but not a comprehensive one.

The suggestion made in the covering note for the committee's consideration is that officials be asked to appear before the committee to answer one question and one question only, namely: What words in section 178(1) of the act does the department rely upon to support its conclusion that the variation order is consistent with the letter of the law? That reply should not give the history of the file nor explain why the department thought it would be unfair not to give $3 million to CN. That reply should not make general claims that they have acted within the spirit and the letter of the law. However, they should answer that one very specific question: What is the statutory language in section 178(1) that supports your position?

That is our suggestion to the committee.

Mr. Wappel: Madam Chair, we already have the Minister of Transport coming to appear before us. I suggest that the letter be as clear as Mr. Bernier said. We want that answer, no preamble, no justification -- just an answer and nothing else.

What I would like to know, Madam Chair, is what else can we do? Here is another one of these situations. We have issued a report and asked for a response. We have received a response. So what? What else can we do if we get a response that we do not particularly like?

Mr. Bernier: We are doing it.

Mr. Wappel: I would like to do something else; however, you have recommended this course of action. I want to know what else we can do. Can we disallow?

Mr. Bernier: The order is spent. The money has been given. I do not know what CN has done with it. Presumably, the remedy in terms of proper application of the law would be an act of Parliament validating those payments.

Mr. Wappel: Again, we have a report that we can do nothing with other than writing a letter or calling them here to testify.

Mr. Bernier: Yes, moral suasion and insistence.

The Joint Chairman (Senator Hervieux-Payette): Your suggestion is accepted. It will be on the agenda and there will be a specific paragraph of the letter referring to this particular case. We want one specific answer regarding section 178.

I do not think a government can pay money without any legal authority.

Mr. Wappel: My concern is this: Once they get that letter, they may answer the question. However, I would like them here so that I can ask them why they did not put that answer in the comprehensive report. I do not want them weaseling out of an appearance by answering the question in response to the letter inviting them here. I want to ensure they actually appear before our committee.

Mr. Bernier: That would be quite a feat, Mr. Wappel, because that question cannot be answered, I assure you.

Mr. Lee: I repeat the point that it is imperative that when the minister comes he is accompanied by an official capable of addressing the issue. If they are to meet with the lawyers from hell, then they better have their final legal word with them because we do not want to have this matter referred out to some other legal expertise at the time. They must bring that with them. The letter should make that clear.


(For text of documents, see Appendix p. 2A:1)

The Joint Chairman (Mr. Grewal): The next item is C.R.C. c. 1325 -- Public Lands Mineral Regulations.

Mr. Bernier: As has been the case in this file for a while, Mr. Chairman, the grounds relied upon by the government keep shifting. For example, reliance on section 13(2) of the Statute Revision Act, apparently, has been abandoned as the minister does not even address the committee's rebuttal on this point.

I also note that the minister avoids answering the very specific questions that were put to her by the chairmen on page 3 of their letter.

Having said this, the minister acknowledges that the standing joint committee has put forward a number of arguments that warrant serious consideration. She states that she has requested her officials to further study the issues raised in an attempt to remove any uncertainties regarding the constitutional validity of unilingual federal regulations that are still in force or may still be in force today.

In light of this, I would ask the committee whether the best course of action might not be for the chairmen to simply follow up on the progress of this item at the time of the summer adjournment.

The Joint Chairman (Senator Hervieux-Payette): Send a letter stating that the committee wishes to have the whole of the answer and not just part of it.

Mr. Lee: Madam Chair, for reasons I cannot recall, I tried to engage in informal discussions on this issue as a member of Parliament in the government lobby, as we say. I think this is an item that could see some progress. The fact that our chair or co-chairs would pursue the matter with the department is constructive. I, for one, would be relatively optimistic about making some progress on the file.

The Joint Chairman (Senator Hervieux-Payette): Mr. Bernier will prepare the proper correspondence.

The next item falls under the rubric "New Instrument."


Ms Margaret Jodoin-Rasmussen, Counsel to the Committee: Regarding the new instruments being introduced, SOR/96-292, the Air Services Charges Regulations, as the committee has probably realized, the problem identified by counsel initially with respect to this instrument is that the charges imposed were zero cents. The position of the committee is that this is not acceptable. That problem no longer exists. Any further discussion on this file would not be worthwhile. We recommend that the file be closed.

The Joint Chairman (Senator Hervieux-Payette): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix p. 2B:1.)

The Joint Chairman (Mr. Grewal): Our next item of business is SI/97-80.

Ms Jodoin-Rasmussen: An incorrect citing of the authority for this order was drawn to the attention of the responsible department. As the correspondence indicates, they promise to take care of this.

The Joint Chairman (Mr. Grewal): What do we do?

Ms Jodoin-Rasmussen: There is nothing to be done. It has been drawn to the attention of the appropriate parties that the authority was incorrectly cited. This item is merely for information purposes.

The Joint Chairman (Mr. Grewal): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix p.2C:1 )

The Joint Chairman (Mr. Grewal): Next, we have the Order Authorizing the Issue of Nineteen Non-Circulation Coins.

Mr. Wappel: Presumably, the same action applies to this next item, too.

Ms Jodoin-Rasmussen: Yes.

The Joint Chairman (Mr. Grewal): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix p. 2D:1)

The Joint Chairman (Mr. Grewal): Under the rubric "Reply Unsatisfactory," the next item is the Non-Canadian Ships Safety Order.

Ms Jodoin-Rasmussen: Section 420(1) of the Canada Shipping Act permits the Governor in Council to direct that Part V shall "apply to any ship or class of ship registered elsewhere than in Canada while within Canadian waters." Section 3 of the regulations does exactly that. However, the section with which we are having problems, section 4 of the regulations, deems that such vessels comply with Part V. There is no authority in the act for this deemed compliance and the department, throughout the correspondence, has been unable to refer counsel to one such authority, although they keep offering up a number of provisions.

In the last paragraph of Mr. McCullough's recent letter of April 26, 1999, the waters are further muddied. On the one hand, he appears to imply that section 420(1) supports section 4, but then he goes on to say that they will keep hunting for a provision other than section 420(1).

We suggest that the committee request clarification of this position by writing another letter to the department explaining why we are confused.

The Joint Chairman (Senator Hervieux-Payette): Is it agreed?

Hon. Members: Agreed.


The Joint Chairman (Mr. Grewal): Our next item of business appears under the heading "Progress", SOR/83-654.

Mr. Bernier: The concern of the committee in this case arose when it was found that the Public Harbours Regulations were being applied to harbours that were treated as public harbours but had never been lawfully designated as such. The committee suggested a legislative solution to this problem, but it was rejected by the minister. The minister chose, instead, to have in-depth historical research of 132 harbours undertaken to ascertain their actual status -- that is, whether they were indeed properly designated as a public harbour. By March of 1998, there remained only 56 harbours that required verification. Concurrently with this research process, there is a decommissioning or deproclaiming process being followed as a number of harbours are privatized.

Approximately 20 of the remaining 56 harbours are to be deproclaimed, at which time the department states it will continue the task of researching the remaining 36 harbours on a priority basis.

Given the timing of the last piece of correspondence, at this time a letter should be sent asking whether the work that was being conducted on a priority basis has now been concluded.

The Joint Chairman (Senator Hervieux-Payette): The harbours at one time were ours and now we are selling them to local authorities. Defining their status -- that is, whether we have jurisdiction over them -- is redundant.

Senator Finestone: Will we be sending grants to clean up the harbours if we fix them up before we sell them? I want to know where they are located.

The Joint Chairman (Senator Hervieux-Payette): No.

Is it agreed?

Hon. Members: Agreed.



The Joint Chairman (Senator Hervieux-Payette): Next is SOR/88-230.

The Joint Chairman (Mr. Grewal): Yes, and SOR/88-263. We will do both together.

Ms Jodoin-Rasmussen: According to Mr. Cameron's letter of November 17, 1999, the amendments are promised to the committee and are to be submitted to the regulations section once they have completed consultations on the specific issues identified in his letter.

We recommend that the committee continue to monitor the progress of these amendments.

Senator Finestone: What do they mean when they say that officials will continue to consult with CAPP, which represents Canada's major oil and gas companies? The oil and gas picture in the Maritimes is an interesting one. What is happening in this regard?

Ms Jodoin-Rasmussen: I do not think that is the issue.

Senator Finestone: What is the issue, then?

Ms Jodoin-Rasmussen: There were amendments in these regulations promised to the committee. The amendments deal with the refining of notice provisions under the regulations.

Senator Finestone: Will it bring gas prices down?

Mr. Bernier: Our amendments are being held up by these. They want to do everything as a package, so they want to wait until they reach a solution.



The Joint Chairman (Mr. Grewal): The next two items deal with the Canadian Exploration Incentive Program Regulations.

Ms Jodoin-Rasmussen: The department has committed itself to revoking the regulations once the last outstanding claim is resolved. We will continue to monitor that situation.

The Joint Chairman (Mr. Grewal): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix p. 2E:1)

The Joint Chairman (Senator Hervieux-Payette): The next item is the Newfoundland Offshore Petroleum Installations Regulations.

Ms Jodoin-Rasmussen: In this instance, Mr. Cameron has written that he will keep us informed as to the progress of the amendments. Perhaps we should write about the status of those amendments.

The Joint Chairman (Senator Hervieux-Payette): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix p. 2F:1)

The Joint Chairman (Mr. Grewal): Next, we have an item under the heading "Reply Satisfactory."

Mr. Bernier: In this instance, Mr. Chairman, section 3(3) of these regulations purported to retroactively validate an illegal freezing by Crown corporations of their 1993 grants in lieu of taxes which were made to municipalities to 1992 levels. Section 3(3) is not authorized by the Municipal Grants Act. The result is that monies are owed by Crown corporations to the various municipalities to which they pay grants in lieu of taxes in amounts representing the difference between what was paid based on the 1992 figures and what they should have paid had they not unlawfully frozen their grants to 1992 levels.

An obvious option to resolve this matter would have been to amend the Municipal Grants Act to validate the 1993 payments.

The Joint Chairman (Senator Hervieux-Payette): Retroactive legislation on payments?

Mr. Bernier: Yes. There is no problem with Parliament doing that. By nature, validation is always retroactive.

Senator Finestone: Money was transferred in 1992 and we are asking for some recognition of where and how it was spent?

Mr. Bernier: In 1992, Crown corporations were at a set level every year. They made those grants to municipalities where they operated and had buildings.

As a deficit-fighting measure, in 1993 they froze the grants instead of following the regulatory process and increasing the amount. They did that based on an unauthorized directive from Treasury Board. Crown corporations said that, in 1993, they would pay you only the same amount they paid you in 1992.

In 1997, an attempt was made to adopt section 3(3) of the regulations to retroactively validate what had taken place. There is no authority for retroactive regulatory provisions under the Municipal Grants Act. That is what brings us to our problem today.

Senator Moore: You may know that Bill C-10 covers the issue of municipal grants in lieu of taxes, because I am sponsoring it in the Senate. It is still in the House of Commons. There may be an opportunity there to talk to Minister Gagliano, who is the sponsor for it, to slip in a section to tidy this up.

Mr. Bernier: Senator, we were aware of that bill coming up at the time, which is why the committee made the suggestion that a legislative solution might be the best way to go. However, for whatever reasons, the minister and the department have rejected that approach. I can only go with their view.

Mr. Quail now informs us that, as of September 1999, the legislative route has been rejected and that instead his department will simply inform Crown corporations of their increased liabilities for 1993. The department will also support a proposal that Treasury Board made to require resources available to those Crown corporations to pay the grants that should have been paid in 1993, whether that is with accumulated interest or not, I do not know.

Clearly, that would be quite an acceptable way of dealing with the situation. We do have some questions as to the efficacy of that approach. In the first place, informing Crown corporations that they owe additional monies is no guarantee that those Crown corporations will pass on the information to the municipalities who are owed those monies. In addition, the department states that it will support a request to Treasury Board for additional money. Again, that is hardly a guarantee that those monies will be made available.

Obviously, the payment by Crown corporations of monies they should have paid in the first place is an acceptable solution so long as they are actually paid. To that end, counsel would feel better about this proposal if there were a clear and verifiable guarantee that municipalities who are owed those monies are informed of the fact. It is then up to them. If they do not wish to pursue the matter, fine; it is their money.

The Joint Chairman (Senator Hervieux-Payette): What is your recommendation?

Mr. Bernier: Perhaps the solution might be to write back to the department and say that the committee wants the department not only to inform Crown corporations that they owe money, but also to inform municipalities who are owed the money of that fact and to provide proof that that has been done.

Mr. Pillitteri: Is this only for 1993?

Mr. Bernier: Yes.

The Joint Chairman (Senator Hervieux-Payette): We will write a letter and I will follow it up with the minister. I think it is a nice gesture. Mr. Bernier's suggestion to inform the municipalities as well is a good way of doing it.

The Joint Chairman (Mr. Grewal): We will now move to action promised and action taken.


(For text of documents, see Appendix p. 2G:1 )


(For text of documents, see Appendix p. 2H:1)


(For text of documents, see Appendix p. 2I:1)

Ms Jodoin-Rasmussen: Under the heading of "Action Promised", we will note for the record that, taking these instruments as a group, we have 28 promised amendments.


(For text of documents, see Appendix p. 2J:1)


(For text of documents, see Appendix p. 2K:1)


(For text of documents, see Appendix p. 2L:1)


(For text of documents, see Appendix p. 2M:1)


(For text of documents, see Appendix p. 2N:1)



(For text of documents, see Appendix p. 2O:1)


(For text of documents, see Appendix p. 2P:1)



(For text of documents, see Appendix p. 2Q:1)


(For text of documents, see Appendix p. 2R:1)

Ms Jodoin-Rasmussen: Turning to "Action Taken", we have done a tally. With respect to these instruments, 10 amendments have been made at the request of the committee. There has been a complete revision of the construction standards of small vessels, and there have been two revocations and one statutory amendment.

The committee adjourned.