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Proceedings of the Standing Joint Committee on
Scrutiny of Regulations

Issue 6 - Evidence

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OTTAWA, Thursday, May 1, 2003

The Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations met this day at 8:38 a.m. for the review of Statutory Instruments.

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

[Translation]

The Joint Chairman (Senator Hervieux-Payette): Mr. Grewal will take over since he is involved in the development of the work referred on the agenda, at first item.

First, Mr. Bernier will give us an overview of the entire report included in our document. For this study, we will go in camera.

The meeting continued in camera.

[English]

The committee continued in public.

The Joint Chairman (Mr. Grewal): We will now return to the public portion of our meeting.

Mr. Cummins: Point of order. Mr. Chairman, I am curious as to the state of the disallowance report and whether the committee has a response from the government on the Aboriginal fishing regulations. We were led to believe that something would be done before summer and we are now into May. There is talk that the House may rise early, yet I have seen and heard nothing from the government in response to the concerns that were expressed by the committee on the Aboriginal fishing regulations.

The Joint Chairman (Mr. Grewal): Could counsel give us an update on that?

Mr. François-R. Bernier, General Counsel to the Committee: I am in the same position as Mr. Cummins, Mr. Chairman — I too have heard nothing.

Mr. Wappel: Mr. Chairman, as Mr. Cummins said, we are into May — the first nine hours. It is premature to inquire but, in any event, for the committee's information, the Minister of Fisheries and Oceans is appearing before the Commons Fisheries and Oceans Committee this afternoon. As the official opposition critic for fisheries, I am sure Mr. Cummins will ask the appropriate questions at the appropriate time.

Mr. Cummins: That is all well and good but the committee had a disallowance report prepared and would have us believe that it is acting independently of the government and that it is making decisions based on legality and prudence without interference external to the committee — certainly without any interference by the government.

However, the facts of the matter are different. I have obtained information, under Access to Information that shows that the government was very active in trying to influence committee members on this issue and in trying to stall, if you will, the disallowance report. They talk in these documents about officials working with PCO to manage this issue and your staff have been in touch with the Whip's office and the Government House Leader's office. Briefing notes and speaking points were used by a member of the committee to be identified by your offices attached. This is a briefing note for the minister from February 7, 2002.

Another briefing note dated February 28, 2002 says that the minister has indicated that he would like to brief Liberal committee members prior to the Easter break but no dates were mentioned. He talked about a briefing, of course, on the Aboriginal Communal Fishing Licence Regulations, ACFLRs. Again, on Thursday, March 14, in briefing notes prepared for the minister, it says that the ACFLRs were discussed at SJC that morning and that, as anticipated, it was quite raucous and acrimonious. There was discussion on the implications of the disallowance. Mr. Wappel stressed the potential chaos that would result from disallowance, and he was supported by Senator Bryden.

On the question of the date for the minister's appearance, there was some discussion of asking him to appear next week but Mr. Wappel intervened in support of giving the minister sufficient time to prepare, particularly if he had already been told that April 11 would be acceptable.

This is only a smattering of the access documents that I have obtained that show that government was quite active in trying to influence members on this issue. My feeling, from talking to the minister and members of this committee and certainly from my participation on this committee, was that government members were assuring us that they were acting strictly in respect of the legality of the issue and that they were not influenced by politics in making these decisions.

I question that from the information that we have received. As I say, it is now May and the fishing season is underway. The natives have had fisheries for a number of weeks now. The department will be in the final stages of preparing for the fishing season at this time. Mr. Wappel should be aware that it is probably already too late.

I would like to know just where and what action this committee has taken to see if the government has lived up to the commitment that it made to the committee.

The Joint Chairman (Mr. Grewal): Thank you, Mr. Cummins. I would like to state that I am sure that all members around this table share your frustration. This is not only one season delayed but as many as seven or eight seasons delayed. Having said that, we all know that the government wants to prevent the regulations from being disallowed for obvious reasons. We had a letter from the minister in which he promised that he would be introducing legislation before the summer. Actually, I am not sure if he said ``before summer'' or ``before the fall.'' When the legislation is introduced, the issues of delegation of power and some of the legal issues will be addressed.

That is my understanding at this time. I have not seen any proposed legislation. I do not know about the time frame. Therefore, one point relates to when the proposed legislation will be before the House. If the proposed legislation were there sooner rather than later, it would have been beneficial to all of us. However, we do not have any control over that. We go by what we are told, as far as the tabling of proposed legislation.

For that reason, the committee members last time reached a consensus that we would look forward to that proposed legislation. Is there anything to add to that?

Mr. Bernier: No.

Mr. Cummins: Mr. Chairman, the fact of the matter is that in our meeting before Christmas, the committee asked that a disallowance report be prepared so that we would not end up in this situation again. This is exactly the same situation that we experienced last year. The confusion about the management of the fishery last year cost the economy of British Columbia almost $200 million. Over 7 billion fish went to the spawning grounds that should have been caught. That was the cost last year. Four years from now, because of that over-spawning, there will be another cost because the catches will be down considerably. That is the cost of inaction.

The committee, before Christmas, took the step of asking counsel to prepare the disallowance report so that we would be able to give the government clear warning of our intentions to ensure that they could know about the disallowance early in the New Year. That would give them the opportunity to have in place some different regulations by the summer.

That has not happened. I would like to know what this committee would do. There is no indication at all from the government that there is any proposed legislation coming forward. There is no indication from the government that there is a new set of regulations being proposed. What are we to do? We had a disallowance report prepared and we did not act on it when we should have. What will we do now?

The Joint Chairman (Mr. Grewal): I have a letter addressed to the Joint Chairmen dated April 16, in which the minister has stated:

As I alluded to previously, given my intent to work toward introducing a bill this session, I will also use the opportunity provided to further clarify the authority with respect to the designation as well as to fulfil the previous commitment to the SJC with respect to the requirement to comply with the licence conditions.

It is my hope that the minister will stand by his word and introduce the legislation this session. If that happens, it will be a positive step. However, if he does not keep his commitment, then I will be as frustrated as any other member of this committee.

Mr. White: Could I ask for a clarification? Assuming that the minister does introduce legislation this session, that still does not alter the fact that we consider the existing regulations to be ultra vires. How can the fishery proceed with regulations that are ultra vires, even if there is pending legislation? We know it will not pass before June 12, or whenever the house is rising. I agree with Mr. Cummins — this is a state of chaos.

The Joint Chairman (Mr. Grewal): As it has been for the last several years with one more year added, unfortunately.

Mr. Cummins: We received a letter from the minister earlier this year in which he indicated that amendments to the act would be introduced in time to have them passed before summer. That was his earlier commitment to us and it has not been fulfilled.

Again, what action will this committee take? Will we move ahead with the disallowance report or will we allow ourselves to be beaten about the ears by the minister again on this issue?

Mr. Lee: I will just express some confusion at what is driving Mr. Cummins. He appears to have a slightly different calendar than I do.

Be that as it may, the objective of the committee, when we have regulations that are ultra vires or improperly drafted or offend our criteria, is to have them revoked and replaced. That is precisely what the minister has agreed to do in this case. He has done it in writing. We had to reach the point of drafting a disallowance report in order to do that but we have reached that point.

Our current stance in respect of the Aboriginal fishing regulations is quite consistent with all the other years of practice of this committee. I do not understand why Mr. Cummins is describing the situation as he is. I suspect that he has other reasons behind his position on this. He is entitled to have those other reasons. However, I am asking members to keep their eyes on the committee's normal procedures because I think we are on track. There is no question about that. The last letter we had from the minister was only two weeks ago and we have not sat for two weeks.

We are fairly up to date on this particular file and I thank Mr. Cummins for keeping our attention on the file.

Mr. Cummins: I should like to respond. Mr. Lee suggested that I have a different calendar than he has. Mr. Lee was present when the committee agreed before Christmas to prepare the disallowance report. He was present when the discussion indicated clearly that it was prepared at that point so that it could be presented to the government early in the New Year to allow sufficient time for the government to respond with the appropriate legislation.

As I have indicated, briefing notes that have I obtained under access to information suggest that the committee has been compromised on this issue. It is not acting independently of government as it pretends to act. Government members are being given talking notes and briefings on what to say here.

That which Mr. Lee is saying reflects that. This is a serious issue. This is a crisis situation. The government is acting illegally. The matter has been before the courts in British Columbia all winter. We are expecting a judgment by June. The courts have promised us again that a judgment will come. There will be chaos unless this issue is dealt with.

Mr. Wappel: Point of order. Mr. Chairman. Mr. Cummins mentioned only one member's name in reading his so- called access to information; that was my name. I want the record to show that at no time was I given briefing notes by anyone. At no time was I told what to say or what to think, nor would anything like that be allowed by me. I resent the implication, and I want to make sure that it is on the record.

The Joint Chairman (Mr. Grewal): This committee does not agree with the government's position on many files. The Aboriginal fishing licence regulations is one of them. Some of them are more serious than others, but we are operating in a political spectrum.

Having said that, we cannot disallow all the 900 regulations as everyone agrees at this table. However, this particular Aboriginal fishing licence and its regulations are more serious than others. At the same time, the committee's first attempt is to rectify the problem. The minister promised this would be done by way of legislation.

I may not agree personally, but the committee members give all indication that the minister should be given a chance to have this legislation introduced during this session. That is where we stand.

We should move on to the agenda items.

Mr. Cummins: Mr. Chairman, it is not the committee members' position. It is what the minister said to the committee. The minister committed to changing the regulations by the beginning of the fishing season. That was his commitment to this committee. On the basis of that commitment, the committee withdrew its disallowance report. It did not proceed with disallowance. That is the issue here.

The minister has failed to meet his commitment. What will the committee do?

The Joint Chairman (Mr. Grewal): That is a very difficult question. Even if the minister had introduced the legislation two months in advance, it would have taken a certain amount of time before the legislation would have passed and the problem would have been rectified. The season would have started anyway, even if the legislation were introduced. Even if the disallowance procedure were underway, still the 30 or 40 days allowed may have been a problem.

I know that there has been a delay. The committee could have done its job a little faster. However, there are constraints under which we operate. I believe that we have that promise.

I may ask members if they think that we need to authorize a letter to the minister to seek further clarification about the legislation timetable. That is one thing that we could do. We may have to respond to the letter that we received. If we hear anything from the minister, we can share it.

I do not have anything else to report at this time.

Senator Nolin: It was suggested that Mr. Cummins raise the question with the minister this afternoon. Why do you not do that?

The Joint Chairman (Mr. Grewal): That would be a good step. If you hear anything, the members of this committee should be made aware of what is happening.

Mr. Cummins: I fully intend to raise it this afternoon, Mr. Chairman. Given that the minister has not fulfilled his commitment to the committee, the reputation of the committee demands that the committee itself take some action. I certainly will take action, but the committee should be doing the same.

The Joint Chairman (Mr. Grewal): I agree. The committee took the minister at his word and he should be accountable for the letter he has written. Committee members will be looking to the minister to keep his commitment.

Senator Moore: What is the date of letter, Mr. Chair?

The Joint Chairman (Mr. Grewal): April 16. 2003.

Mr. Bernier: Mr. Chairman, do I not recall that the parliamentary secretary indicated that the commitment was to introduce legislative amendments before June?

Mr. Cummins: Yes, he did.

Senator Moore: Before summer break.

Mr. Bernier: There was a date, as I recall, given in committee. It may not have been given in writing, but I recall Mr. Farrah specifying that this session meant prior to the summer recess to him.

The Joint Chairman (Mr. Grewal): We look to the minister to keep his commitment. Thank you for your intervention. We will move on to the next agenda item. If there are any developments, committee members will be made aware.

PARKS CANADA MASTER LIST OF FEES

Mr. Peter Bernhardt, Counsel to the Committee: Thank you, Mr. Chairman. Since 1994, all the fees for national parks and national historic parks have been fixed on an administrative basis by the minister, rather than by regulation. These fees are then put together in what is called the Parks Canada Master List of Fees.

At the same time, under the Parks Canada Agency Act, these fees stand referred to the joint committee just as if they were in fact regulations. That is how the committee comes to be seized of them.

The committee elsewhere has taken the view that the effect of certain provisions in the Canada National Parks Act is that fees relating to national parks can only be imposed by regulations made under that act and that there is no authority to put in place fees through this master list.

This issue, as I say, has been raised elsewhere. It is being pursued in connection with another file. Members have before them this morning the concerns arising from the master list itself — aside from the question of whether there is authority for it in the first place. We have two levels of concern.

The concerns here this morning came to light following a request for copies of all the original documents by which the minister had fixed the fees put out in the master list. This led to a bit of a shaggy dog story. The various details and chronology are set out in the minister 's letter of September 16.

The committee ultimately received a collection of rather unclear and undated documents that dealt with only a fraction of the fees that had been imposed. In short, there seems to be no paper trail whatsoever for most of these fees to verify when and by whom they had been put in place.

Both the Department of Canadian Heritage and the Parks Canada Agency recognized that there were shortcomings. Apparently, there are now more formal procedures in place. These are a parallel track. They follow some of the same internal steps as followed when making a regulation.

This situation should not arise again in future. At the same time, there is much uncertainty remaining in connection with the fees that are in place and continue to be enforced. To resolve this, it was suggested in the chairmen's letter that an entirely new master list of fees be adopted to provide a fresh starting point from which to proceed.

The agency's reply agrees there should be a fresh start. Somewhat curiously, it then proposes starting to send copies of original fee proposals to the committee as being this fresh start. I am not sure why this would be thought to address the concern.

I have some sense that they still do not grasp exactly the committee's position. They may feel that the committee's objection was merely that its nose was out of joint because it was not getting documents as opposed to being concerned with whether the fees were being properly fixed.

In any event, perhaps we should return to the agency to clarify the committee's position and again suggest that the master list should be remade completely. This does not involve any extra work. They publish the master list annually and consolidate it. They need only send that to the minister and have the minister sign it off before it is published. We could then be sure that all of these fees have been indeed fixed by the minister. It is a small administrative exercise.

The Joint Chairman (Mr. Grewal): Do we need any clarification?

Mr. Bernhardt: It is more a question of the committee clarifying its position for the agency and explaining exactly what is meant by a fresh start, what is involved and why it should be done. It is not an onerous exercise.

The Joint Chairman (Mr. Grewal): That would be done by a letter.

Mr. Lee: I was surprised at how the fee-setting exercise has muddled along within that particular agency.

In the absence of a regulatory framework, I guess they just did what they had to do. Sometimes it went on a piece of paper, sometimes it went on a computer and sometimes it was in a letter. The absence of something that I am about to describe is truly quite significant, in terms of modern governance. What we want to see in that department is what I would call a business-like foundation, fee-making document that is properly endorsed, signed, recorded, published and promulgated.

I do not care if they do it on the back of a Loblaw's paper bag, but it must be done. We simply wanted to see that document and they apparently did not have it. Counsel will now clarify where it is that we want to be. I hope my comments will be helpful to the agency as will counsel's comments.

The Joint Chairman (Mr. Grewal): We will move on to the next item.

SOR/93-3 — OIL POLLUTION PREVENTION REGULATIONS

(For text of documents, see Appendix A, p. 6A:1)

Mr. Bernier: The reply received from the Minister of Transport is satisfactory, Mr. Chairman. In that letter, the minister indicated that he expected the required amendments to be in place by May. The next issue of the Canada Gazette, Part II is due out on May 7. If members agree, in the event that issue does not include the requested amendments, the chairmen would then remind the minister of his undertaking.

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

Mr. White: I have a question. In the reply dated April 3 from Minister Collenette, it says at the bottom of the first page, ``I anticipate that the amendments will be made through a miscellaneous amendment by May of 2003.'' We just entered May. Have they been made?

Mr. Bernier: That is a proper lawyer's approach to the letter, ``by May.'' I am assuming that the amendments may have been made by May 1 by cabinet but they have yet to be published in the Canada Gazette, Part II, which is why I suggested waiting for the May 7 issue to see if, in fact, this commitment has been met.

The Joint Chairman (Mr. Grewal): We look forward to May 7. What do we need to do?

Mr. Bernier: We will verify the next issue, Part II, Mr. Chairman, and if the amendments are not included in that Canada Gazette or if we have no other indication that cabinet has adopted the amendment, the chairmen will write again to the minister.

The Joint Chairman (Mr. Grewal): We will look forward to that.

The next item is DNA Identification Regulations.

SOR/2000-300 — DNA IDENTIFICATION REGULATIONS

(For text of documents, see Appendix B, p. 6B:1)

Mr. Bernier: For some reason that will probably remain unexplained, the former Solicitor General directed a reply to Mr. Bernhardt's letter to one of the joint chairmen of the committee. It is quite an honour. I guess Mr. Bernhardt's letters are viewed with great importance. A correction of the discrepancy between the two versions of section 238 of the regulation was made by SOR/2000-2451, and this file can be closed.

Mr. Lee: May I acknowledge the remarkable courtesy of the former Solicitor General in allowing us the consideration to comment during the 30-day window of public comment, to which he refers in his letter. We probably missed that window, but fortunately, we in Parliament have other procedures available to us.

The Joint Chairman (Mr. Grewal): Let us move on to the next agenda item, SOR/2000-24.

SOR/2000-24 — ORDER AMENDING THE DOMESTIC SUBSTANCES LIST AND THE NON-DOMESTIC SUBSTANCES LIST

(For text of documents, see Appendix C, p. 6C:1)

Mr. Bernhardt: Questions were raised about why the introductory portion of the order, as well as the regulatory impact analysis statement, bore no relationship to the amendments actually being made and why the order's title referred to amendments that were not contained in the order. Not surprisingly, the advice received was that an error had occurred.

More helpful is the promise to ensure that this order is at least properly indexed in the Canada Gazette on the basis of its actual content rather than on a misleading title. That has been done therefore I suppose there is nothing more to do.

The Joint Chairman (Mr. Grewal): Our next item is under the heading ``Reply Unsatisfactory.''

SOR/95-413 — CANADA GRAIN REGULATIONS, AMENDMENT

(For text of documents, see Appendix D, p. 6D:1)

Mr. Bernier: Mr. Chairman, under the Canada Grain Act, a person dissatisfied with the grade received for their grain can appeal the grade to a grain appeal tribunal. This is a statutory right and the grain appeal tribunals have a corresponding duty to hear the appeal.

Pursuant to section 116 of the Canada Grain Act, the Canadian Grain Commission is authorized to prescribe fees payable for services rendered by or on behalf of the commission. Pursuant to that authority, fees were prescribed in respect of appeals. However, an important characteristic of the fees is that they are only payable where an appeal is unsuccessful.

Initially, a concern was raised as to whether the hearing of an appeal could properly be characterized as a service rendered by the commission. As the term ``service'' is usually understood it would not, it would seem to us, include the hearing of an appeal where the person or the body has no choice but to fulfil its statutory duty. As noted in the letter of September 19, 2002, the committee decided to set that issue aside and focus instead on the fact that the fee in question is payable only if the applicant is unsuccessful but not if he is successful in his appeal.

If hearing an appeal is indeed a service, it stands to reason that the service is rendered in all cases, irrespective of the outcome of the appeal. Therefore, anyone who asks for the service should be made to pay.

In requiring only unsuccessful applicants to pay for the service, the commission is either seeking to penalize unsuccessful applicants or it is seeking to discourage frivolous appeals. The committee has questioned whether it is proper for a fee structure to be established for such a purpose and has suggested that this use of section 116 represents an unusual and unexpected use of the authority.

In its reply, the commission neither confirms nor denies that the purpose of the fee structure is to discourage frivolous appeals. The reply simply states that, in their view, the statute authorizes such fees. It goes on to say that this system has been in place for many years and that to charge for all appeals, irrespective of outcome, would have ``severe negative economic consequences on the grain industry.''

Mr. Chairman, I cannot help but think that this is a slight exaggeration. When you consider that the fee in question is $ 25. If the $ 25 fee would have such serious economic consequences if charged in all cases, why does it not have similar negative economic consequences when charged to unsuccessful applicants? This reply also fails to consider the alternative option, which is to not charge fees for any appeals. Under the guise of a fee-for-service, unsuccessful applicants are being penalized. It seems particularly inappropriate for this to take place in relation to persons who are exercising a right that Parliament gave them.

There was also a question raised with respect to the possible illegal collection of fees between August 1 and August 16, 1995. Members may recall that the commission had stated that it could not determine whether fees had been collected illegally during that period of time because the relevant financial records had been destroyed. When the file was last before the committee, a member of the committee specifically wanted counsel to obtain from the commission an acknowledgment that if the fees had been collected, they would have been collected illegally.

The response is not exactly that which was requested. Ms. Gilroy simply confirms that fees in excess of the legal amount may have been collected, but she does not acknowledge that such collection was illegal.

There are two questions: Do members want to pursue the first point, and do they wish to pursue this request for an acknowledgment?

The Joint Chairman (Mr. Grewal): Any comments?

Mr. Lee: Counsel have been assiduous in outlining difficulties with the current fee structure. This is one of those files where I tend to think if it is not broken, do not fix it. Counsel has suggested the various options that are available. However, the acknowledgement of possible collection of fees during a two-week period that would not have been legally collectible is reasonable. That was eight years ago.

I am inclined to leave the matter, having flagged the issues. Because it is only a $ 25 fee, the unusual or unexpected use of power item seems to be fairly small. We might end up spending that much for photocopies if we take this much further.

We have flagged potential issues, but I am not terribly motivated to move further on the item. I will listen to colleagues.

Mr. Wappel: I agree with Mr. Lee. That was my reaction when I read the material.

The Joint Chairman (Mr. Grewal): Is that acceptable?

Senator Moore: Does counsel write again, Mr. Chair? The letter asks how strongly the committee feels. Should we respond, or not bother?

Mr. Bernier: The best comment is that the committee does not feel very strongly.

Mr. White: I cannot share the comfort level that is being expressed. I have a bit of a problem in that we have pursued this fairly vigorously and we have made some fairly strong points made in our letter. We will now merely drop it without giving it one more push.

How does counsel feel? Do you feel that there could be anything achieved by having one more kick at the can here?

Mr. Bernier: I feel whatever the committee feels, Mr. White.

The Joint Chairman (Mr. Grewal): After working so hard on the file, it would not be a bad idea to give it another kick at the can.

Mr. Bernier: The fee is small; that is one consideration. On the other hand, from the point of view of principle, it is objectionable, when charging a fee-for-service to a number of people in the same position and using the same service, to have some people pay for it and others not pay without a rational basis to create these classes.

Mr. Lee: They seem to have a system that is working reasonably well. I suppose that they could charge everyone the $ 25 as an administrative fee for the services of preparing and proceeding with the appeal by looking at the two kernels of grain and figuring out what is what. There are courier charges and postage charges.

They could charge everyone $ 25 with a rule that says that if one is successful on appeal, the $ 25 is returned. In that case, everyone would be in the same position.

Perhaps they are not having trouble collecting the $ 25 from the losers. That is appears to be what is occurring. If I were operating the service, I would charge the $ 25 from everyone and give a rebate to the winners.

Mr. White: I am concerned about the principle. There is a little bell ringing in my memory about a similar scheme in regards to immigration applications and appeals. I cannot remember the exact situation, but there is something similar about which I need to talk to my assistants.

I am a little uncomfortable that we should drop something like this. What would we do if we come across a more serious application of this process with higher fees than $ 25?

Mr. Lee: You have my attention.

The Joint Chairman (Mr. Grewal): We will write a letter. Is there any further comment? Counsel can give the matter another kick at the can. Let us move on. We have two more items under this agenda section.

Mr. Bernier: I am unclear on the current matter. Are we writing again to request this amendment? Your summation did not make the direction clear.

The Joint Chairman (Mr. Grewal): Mr. White said you have worked hard on the file and to proceed. However, Mr. Lee and Mr. Wappel think that we do not need to bother further. It would not hurt to write another letter to highlight the problem.

Mr. Bernier: Mr. Chairman, with due respect, the committee must decide that it either pursues an objection or it does not.

The Joint Chairman (Mr. Grewal): Should we pursue it?

The Joint Chairman (Senator Hervieux-Payette): I do not mind if we pursue this, but we need to know what we are going to write. If we write, we should stand by what we said previously explaining that we hope they will eventually understand and act upon our request. I would be willing to send that kind of letter. However, we do not want to start the debate over again.

Mr. Bernier: Perhaps an alternative that might satisfy everyone would be that the chairmen writes to the minister responsible to simply put on record the view of the committee that this practice is undesirable and leave it at that.

Mr. Lee: May I suggest a different compromise. We could simply send a copy of the transcript to the Canadian Grain Commission and leave the minister out of the loop. Counsel is quite right to point out the difficulty of carrying on correspondence when the committee is not motivated to pursue the matter.

I would like to be able to close the file, however, I would like to be able to close it in a way where we have crystallized our views with the Canadian Grain Commission. We should ensure that they are familiar with the position of the committee and will take what steps they should. If we receive a complaint on it in the future, then we will be back on the case, no doubt.

The Joint Chairman (Mr. Grewal): Is that good enough?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): We will move on to SOR/99-268.

SOR/99-268 — ORDER AMENDING THE SCHEDULE TO THE CUSTOMS TARIFF (FERRO- CHROMIUM AND CERTAIN AUTOMOTIVE GOODS)

(For text of documents, see Appendix E, p. 6E:1)

Mr. Bernier: In this case, counsel had written to the DIO for the Department of Finance in relation to this file in September 2000. When no reply was forthcoming, the chairmen wrote to the minister to request his assistance. The reply was made a month later.

Unfortunately, that reply left a number of questions unanswered. On November 13, 2002, Mr. Rousseau wrote again to the DIO to request further information. There has been no reply to that letter to date. The chairmen will apparently be called upon again to follow this up with the minister and seek again the minister's assistance in securing a reply.

Mr. Wappel: Mr. Chairman, my note on this one was to call Ms. Kilmartin as a witness.

The Joint Chairman (Mr. Grewal): Before the committee?

Mr. Wappel: Yes. I do not want to waste the minister's time. Get this lady here to explain why she has not answered the letter of November 13. I will bet that as soon as we send her the letter, she will answer.

Mr. Lee: Agreed.

The Joint Chairman (Mr. Grewal): It appears that we have agreement. It is possible to call the witness.

Our next agenda item is SOR/2000-221.

SOR/2000-221 — REGULATIONS AMENDING THE LETTER MAIL REGULATIONS

(For text of documents, see Appendix F, p. 6F:1)

Mr. Bernhardt: Mr. Chairman, we are dealing with subsections (4) and (5) of section 3 of these regulations. These put in place a mechanism that provides for an automatic increase in the domestic basic letter rate, effective January 1 each year, in an amount that is equal to two-thirds of the increase in the consumer price index for the period from the last increase to May of the current year. The enabling authority for putting in place postal rates is section 19(1)(d) of the Canada Post Corporations Act, authorizes the corporation, with the approval of the Governor in Council, to make regulations prescribing rates of postage.

While this mechanism in the regulations can be said to prescribe the manner in which rates are to be determined, it is difficult to see how it can be said to prescribe the actual rate as the act requires. This is underlined by section 19(2) of the act. This provision requires that certain considerations be taken into account prior to prescribing a rate of postage — namely that the rate be fair and reasonable and consistent so far as possible with providing a revenue, together with any other revenue from other sources, sufficient to defray the costs incurred by the corporation.

This requires that an assessment of these factors be made before prescribing the rate. Yet, what is not provided for here is an automatic rate increase. This means that the corporation will not be satisfying itself on the basis of the section 19(2) factors. As well, an automatic increase effectively does away with the requirement that the Governor in Council approve a prescribed rate.

As further ground, it was also suggested to the corporation that the legislative history of the act and the parliamentary debates that accompanied the passage of the Canada Post Corporations Act indicated that a regulation that did away with the obligation to adopt each particular rate at each particular time by means of a regulation that is made by the corporation, approved by the Governor in Council, and registered and published in accordance with the statutory instruments Act, was simply an unusual and unexpected use of the power and contravened the committee's scrutiny criteria.

The position put forward by Canada Post is that the power to prescribe a rate brings with it the power to fix a formula by which that rate can be calculated. As a bald statement, this is true. However, it is true only where the variables in the formula will not be determined by future events. The corporation says, in its words, the equation must be based ``on non-variable numbers ascertainable and quantifiable at the relevant time.'' The relevant time, however, is the time when the formula is enacted. The formula for determining the rate cannot be used simply as a means to avoid having to make future amendments through the vehicle of building in automatic increases.

As for section 19(2) — the relevance of these factors to be taken into account — I think the corporation misunderstands the committee's point. It seems to think that what was suggested was that in and of itself, an automatic increase could not be fair and reasonable. That is not the point at all. The point is that before putting a rate in place the corporation has to undertake a consideration of these factors and decide that it would be fair and reasonable. If the fee increase is automatic, obviously there is no consideration of any factors.

As an aside, I suppose I must also take issue with the characterization of references to legislative history and parliamentary debates as dealing with ``political and public policy considerations'' as opposed to dealing with issues of law. Recourse to these materials is an accepted aid in interpreting legislation. That proper interpretation of legislation is clearly not a political or public policy matter.

This having been said, the unexpected and unusual use of power criterion is not a legal one, in any event. I would suggest that concerns on this file should be pursued by a letter to the corporation.

Mr. Wappel: Mr. Chairman, I was personally impressed by Canada Post's response. I do not read it in the way our counsel reads it. I do not think they misinterpreted what we were saying in respect of section 19(2). I have no difficulty with the ``if it ain't broke, don't fix it'' philosophy that Mr. Lee mentioned in the previous file.

In my view, they have provided a very open and above-board method by which to fix postal rates so that everyone who relies on postal rates is able to determine well in advance what the likely increase will be. They are looking at it as less than the rate of inflation. I will not go through the whole formula.

When I read this, I realized that it was probably the first time in all the years that I have been on the committee that under the heading ``reply unsatisfactory,'' I thought that two of the three items were satisfactory. That is most unusual.

This letter satisfied me and I would not want to see it pursued. Having said that, if someone has an alternative argument, I would be happy to hear it. It seems to me that the way in which the letter was written satisfied my concerns that were brought by our counsel.

The Joint Chairman (Mr. Grewal): Do you propose proceeding on this?

Mr. Wappel: I propose that we do not proceed.

Senator Moore: I want to make a comment. We get used to the term ``postal rate,'' which is a tax. It was one of our first forms of taxation. We are now treating it as just a rate and we let them change it without going before anyone for approval. I do not like that. I do not care if the tax is fifty cents or $50,000, I do not think it is right. I would like to see him proceed and try to get this thing knocked down the way he suggested.

Mr. Lee: I agree that the reply from Canada Post was what I would call ``a dedicated, fulsome response.'' They are clearly trying to address the issues for us and to help us with this.

I also have almost the same concern as Senator Moore. The baseline question is whether a predetermined decision that two-thirds of the cost of living increase would always be, as a formula, a reasonable increase in the charges for postal services. We are talking about the cost of a postage stamp only and not all the other services that they offer.

How could it not be reasonable to charge two-thirds of the cost of living, generally, in our society? There may be some logic to that and most people would agree. However, the history of postal rates, as Senator Moore points out, has been closely monitored in this society. In fact, the people still own the post office. The statutory scheme for increase in postal rates includes requiring those who are to set the rates to consider the issue of appropriate increase levels and fairness, and, perhaps from the perspective of the people, the politics of the people.

Will we accept in Parliament that the people whom we have asked to turn their minds to the fairness issue in setting rates have subsumed that exercise into simply taking two-thirds of the cost of living?

If we accept it in this case, will we have to accept the formula approach from here on in everywhere across government, such that it would be two-thirds of this and one-half of that? Will it always be that way? I am not comfortable with simply walking from this. I would like a chance to do some more thinking about it.

Mr. Wappel: I want to point out to that on page three, the second and third paragraphs specifically acknowledge that the price-cap formula may not, in all cases, be fair and reasonable. The document also indicates that they are well aware that the fee be fair and reasonable. In the third paragraph, they acknowledge that there may be economic circumstances that would require a further decrease or an increase depending on the circumstances. They are well aware of that. That is part of their thinking. It is not that they are saying that the price-cap formula is the answer, full stop.

They acknowledge that there might be circumstances where that cap formula might not be appropriate and that is where section 19(2) would come into play. That is why I was inclined to leave it alone.

However, if the majority of the committee feels that we should pursue it, we can go with it.

Mr. Lee: We are now talking as if we are the other committee in the House of Commons that deals with the post office. We are talking policy, almost.

Senator Moore: We are talking about oversight of taxation.

Mr. Lee: In this committee, we are supposed to talk law. We are back to the issue. Is the procedure and mechanism put forward by the post office in compliance with our law? Mr. Wappel, Mr. Moore, Mr. Lee, and Ms. St-Hilaire are waiting to hear from Mr. Bernhardt.

Mr. Bernhardt: You are making a good point, Mr. Lee. The issue of 19(2) was raised as a buttress to the primary point, which is that the power here is to prescribe a rate. Does this prescribe a rate?

If the power were to prescribe the manner in which a rate is to be fixed, I would have no problem. The question for the committee is, does it prescribe a rate? I would suggest that it does not. Members may have other views.

Mr. Wappel: The Justice Department's argument is that in order to prescribe a rate the rate itself must be set in regulation, or it must be possible to determine that rate from the application of a formula. Do you reject that argument by the Department of Justice?

Mr. Bernhardt: In and of itself, no. However, the variables in that formula cannot be determined by future events. Those variables in the formula must be fixed at the time.

Mr. Bernier: On the face of the regulation, the formula must yield a rate. That is the rate prescribed. It should not generate a multitude or a succession of future rates. That is what Mr. Bernhardt is referring to by a fixed formula, not a variable.

Mr. Bernhardt: If the formula were to be based on 42 cents plus two-thirds of the consumer price index, as it existed on this date, I would have no objection. That would be a formula with variables and be fixed. To me, that would be as good as prescribing 48 cents. It would come to the same thing.

The difficulty is that they presume that they will know in advance, what factors make the future consumer price index.

Mr. Bernier: An important point to emphasize is the approval function of the Governor in Council. Perhaps the government finds this somewhat convenient, because often when you hike up the cost of stamps, it is accompanied by displeasure by consumers. Cabinet has to answer for that.

With this formula, everyone can walk away and say, ``It has nothing to do with me. It is a formula.'' However, Parliament presumably meant it when it said that it wanted cabinet involved in the fixing of postal rates. It did not mean for the regulation maker to find a way to avoid involvement by cabinet. A proposal to increase a rate must be authorized. The formula may be reasonable. That is not the debate. The debate is whether the increase has been authorized.

We are saying that you cannot do it in advance. Every year, Canada Post Corporation must go to cabinet and request approval for an increase. Cabinet then retains the possibility to say no. Even though it is reasonable, there are other factors in play. The government can reject a proposal on the basis that it does not consider this is an appropriate time for an increase for whatever reason. That is political control. That is the control Parliament meant to be there, and that is being bypassed.

Mr. Wappel: With all due respect, I do not think that was clear in the letter of September 24. Certainly, it was not clear to me. If we write, let us make it clear that the committee feels that cabinet must address this every year. That is the bottom line, is it not?

It must be proposed every year because the formula provides for six months back on the CPI.

Mr. Bernier: If they wish to retain that.

Mr. Wappel: If they wish to retain that. The critical issue is that it must go to cabinet each time.

Mr. Bernier: The other critical issue is the scope of the enabling power. This is a power to fix rates. That does not provide authority to have an open-ended formula or formula that includes variables.

Mr. Wappel: Let us make that crystal clear in the next letter and ask them to respond.

The Joint Chairman (Senator Hervieux-Payette): Perhaps I can add something, Senator Moore. It is a question of whether it is an indirect tax. We will deal with CRTC on a later date on the question of a Crown corporation charging a fee to provide a service that they are supposed to provide.

Questions like that will have to be addressed as one. This file is one of the examples that could be brought forward.

I would support that we clarify this question and that we respect the regulatory process. We should write to them that we agree that they have made a reasonable effort, but at the same time, they must comply with the regulation principle.

Senator Moore: I agree with what you say, Madame Co-chair. However, postal rates are a tax experienced by everyone across the board. It is one of our first taxes. Whether a citizen or businessperson, everyone bears it. The CRTC detail is about fees and charges.

The Joint Chairman (Senator Hervieux-Payette): You pay at the end of the day, when you pay for the service.

Senator Moore: This is very easily identifiable. It is a fundamental service. Parliament should be accounting for it.

Mr. Bernier: That is why Parliament has always considered matters relating to the post office as matters of great sensitivity.

The Joint Chairman (Mr. Grewal): Agreed. We will write a letter on those two points.

The next item is SOR/91-317.

SOR/91-371 — MAPLE PRODUCTS REGULATIONS, AMENDMENT

Mr. Bernier: There remains only one small correction to be made before we can close this file. In a letter that came in after the agenda was prepared, CFIA stated incorrectly that all amendments relating to this instrument had been made. I have already written to point out this is not correct in that this one amendment remains to be made. The letter was sent a week ago or so.

The Joint Chairman (Mr. Grewal): The next four items relate to national parks fishing regulations.

SOR/96-245 — NATIONAL PARKS FISHING REGULATIONS, AMENDMENT

SOR/97-111 — REGULATIONS AMENDING THE NATIONAL PARKS FISHING REGULATIONS

SOR/98-268 — REGULATIONS AMENDING THE NATIONAL PARKS FISHING REGULATIONS

SOR/99-352 — REGULATIONS AMENDING THE NATIONAL PARKS FISHING REGULATIONS

Mr. Bernier: It would appear that the proposed amendments have yet to be pre-published for consultation. Therefore, it is unlikely that they will be made by the time originally forecast. A further letter should be sent enquiring into the current status of the promised amendments.

Mr. Lee: Agreed.

Mr. Wappel: Mr. Bernier, forgive me, what is the meaning of the sentence on page 2, by Carolyn Strauss in the letter of July 9. 2002?

Mr. Bernier: There were two packages of amendments being processed by the department. The amendments promised to the committee were to be included in package number two. Ms. Strauss is simply explaining that package number one is too far along to be modified to include the amendment, which they will put in package number two.

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

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): We will move to the next item, SOR/91-152.

SOR/91-152 — CHLOROBIPHENYLS REGULATIONS

Mr. Bernhardt: The need for two amendments to correct the drafting of these regulations was first identified in 1992. There were delays in making the amendments. These delays, together with other delays, were discussed when officials from the Department of the Environment appeared before the committee in December 1997. At that time, they told the committee that the amendments would be pre-published by early 1999. The amendments have not yet been made. Most recently, the department advises it is now anticipated that the revisions to the regulations will be made this fall.

The Joint Chairman (Mr. Grewal): That is fine.

Mr. Lee: Progress is slow; yet, at least there is progress.

The Joint Chairman (Mr. Grewal): The next two items on the agenda fall under the heading of ``Part Action Promised.''

SOR/2000-202 — GENERAL NUCLEAR SAFETY AND CONTROL REGULATIONS

SOR/2000-206 — URANIUM MINES AND MILLS REGULATIONS

(For text of documents, see Appendix G, p. 6G:1)

Mr. Bernhardt: As a covering note on SOR/2000-202 explains, these regulations repealed two previous regulations that were the subject of numerous long-standing concerns of the committee. The new regulations in turn gave rise to several new points. These are discussed in the correspondence on SOR/2000-202. Amendments have been promised in connection with all of them, except for points one and three. On these, it is suggested that the commission's explanations can be taken as satisfactory. All that remains at this time would be a progress report on the promised amendments.

The two satisfactory matters also came up in connection with SOR/2002-206, the uranium mines and mills regulations. That is why that file is together with this one this morning.

Those matters are satisfactory on this file, as well. There was also one amendment promised on SOR/2000-206 and that should be chased up as well. On both of those files, it is simply a matter of following up on the progress of what has been promised.

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

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): We will go to the next item, under the heading ``Reply Satisfactory.''

SOR/91-517 — RADIO REGULATIONS, 1986, AMENDMENT

(For text of documents, see Appendix H, p. 6H:1)

Mr. Bernhardt: The authority for providing that certain requirements apply to licensees unless the condition of the licence provides otherwise, was questioned. The commission replied that in its view, the act did contemplate that there would be two regimes: The regime of general application in the regulations and a series of specific individual regimes put out in the licences. Upon examining the act and upon reflection, it is suggested that the commission's view reflects a reasonable reading of the act and that it should be accepted.

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): The next item is under the heading ``Reply Satisfactory,'' question mark.

SOR/2001-1 — ORDER ADDING A TOXIC SUBSTANCE TO SCHEDULE 1 TO THE CANADIAN ENVIRONMENTAL PROTECTION ACT, 1999

Mr. Bernhardt: The question arose as to whether an error that appeared in the version of this order as published in the Canada Gazette was such as could be corrected by an erratum. An erratum is appropriate to correct a printing or typographical error, but change to the regulation as it was made, no matter how minor, requires a formal amendment.

The Assistant Clerk of the Privy Council advised that the error was indeed a printer's error and she provided certified true copies of the instrument that were approved by the Governor in Council to verify this. The trouble was that these certified true copies differed materially from the certified true copies given the committee.

This then was questioned. The explanation was given that the one that she had provided was indeed the ``true'' certified true copy and the certified true copy provided to the committee was not in fact a certified true copy but contained an error. Thus, we have multiple certified versions and certified true, untrue and partly true copies.

The committee has no further means to verify what was or was not passed by the Governor in Council. I suppose there is no choice but to accept that the committee's certified true copy was not the true certified true copy.

It is my understanding now that the promised new procedures that were to be put in place have been implemented, with the result that all certified true copies are now made from one single original. That way, this will not happen again in the future.

Mr. Bernier: The problem is that two different copies were being used to produce certified true copies for different purposes. Inevitably, that would, at times, give rise to this kind of situation. Now, one master copy is being used so we can trust and rely on the certification.

Mr. Lee: That is good work all round; the problem has been resolved.

Mr. Wappel: It is amazing that it takes until the year 2002 to straighten something like this out.

Mr. Bernhardt: Members experienced in the practice of law could just imagine going off to the registry office and getting extracts of things only to find that everyone and his brother had a different version of the same thing, all purporting to be certified true copies.

The Joint Chairman (Mr. Grewal): We will move on to the next items under ``Action Promised'' and ``Action Taken.''

SOR/92-446 — TRANSPORTATION SAFETY BOARD REGULATIONS

(For text of documents, see Appendix I, p. 6I:1)

SOR/97-302 — REGULATIONS AMENDING THE MAPLE PRODUCTS REGULATIONS

(For text of documents, see Appendix J, p. 6J:1)

SOR/98-267 — REGULATIONS AMENDING THE NATIONAL ENERGY BOARD COST RECOVERY REGULATIONS

(For text of documents, see Appendix K, p. 6K:1)

SI/2001-113 — ORDER REPEALING ORDER IN COUNCIL P.C. 1995-325 OF FEBRUARY 28, 1995

(For text of documents, see Appendix L, p. 6L:1)

SOR/2002-26 — REGULATIONS REPEALING THE ACTION LOAN REGULATIONS

(For text of documents, see Appendix M, p. 6M:1)

SOR/2002-124 — REGULATIONS AMENDING THE FISH INSPECTION REGULATIONS (MISCELLANEOUS PROGRAM)

(For text of documents, see Appendix N, p. 6N:1)

SOR/2002-127 — REGULATIONS AMENDING THE P.S.S.R.B. REGULATIONS AND RULES OF PROCEDURE, 1993

(For text of documents, see Appendix O, p. 6O:1)

SOR/2002-247 — REGULATIONS AMENDING THE PARI-MUTUEL BETTING SUPERVISION REGULATIONS (MISCELLANEOUS PROGRAM)

(For text of documents, see Appendix P, p. 6P:1)

SOR/2002-323 — REGULATIONS AMENDING THE REGULATIONS RESPECTING THE ELECTION OF DIRECTORS OF THE CANADIAN WHEAT BOARD

SOR/2000-302 — REGULATIONS AMENDING THE REGULATIONS RESPECTING THE ELECTION OF DIRECTORY OF THE CANADIAN WHEAT BOARD

(For text of documents, see Appendix Q, p. 6Q:1)

SOR/2002-370 — REGULATIONS AMENDING THE NATIONAL PARKS BUSINESSES REGULATIONS, 1998

(For text of documents, see Appendix R, p. 6R:1)

Mr. Bernier: I will deal with all the files under ``Action Promised'' and ``Action Taken'' as a group. Taken together, they are eight undertakings to make amendments to address concerns of the joint committee. Some 14 amendments, including two repeals, have been made in compliance with undertakings given to the committee. I would add that there are 48 statutory instruments submitted without comment.

Mr. Lee: Well done.

The Joint Chairman (Mr. Grewal): Thank you.

Mr. Bernier: In two weeks, we will have a partial agenda with witnesses from Treasury Board to discuss cost recovery.

The committee adjourned.

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