There is an opinion piece in the Toronto Star today I would like to share with you. It was written by Sinclair Stevens who was minister of regional industrial expansion in the Mulroney government and who introduced the first Investment Canada Act in December of 1984. It is particularly poignant for this reason and directly related to my previous posts about RADARSAT-2.
Highlights of the full article:
When I was minister of regional industrial expansion in the Mulroney government, I introduced the first Investment Canada Act in December 1984. At that time, I pointed out that the Foreign Investment Review Agency created by the former Liberal government in 1974 had become an obstacle to legitimate investment by non-Canadians in Canada. That act required every foreign investment to be reviewed by cabinet. We changed that by saying if acquisitions involved $5 million or more, there would be a review. That would catch 90 per cent of them in dollar terms while filtering out 80 per cent of what the previous government was reviewing in volume. The previous Liberal government had used up more than 20 per cent of its cabinet agenda reviewing cases that included takeovers valued at less than $5 million.
Under our Progressive Conservative government, purchases worth more than $5 million were reviewed and we were able to hammer out conditions that a foreign buyer had to meet before the deal could close.
Our government continued to monitor the operation after closing and could bring the new buyer into line if any conditions were broken. I understand this approach continued under succeeding governments.
The provisions in Flaherty’s budget legislation will raise the review levels in the Investment Canada Act so that only acquisitions of more than $1 billion, to be defined in regulations, will be reviewed. That means practically any foreign purchase of a business in Canada is now virtually non-reviewable.
It is unbelievable that the government would smuggle such a change into its budget bill to avoid meaningful debate. It is even more unbelievable that the Liberal opposition would acquiesce to such a move when 30 years ago they reviewed virtually every foreign purchase of a Canadian business, including, for example, hair stylist shops, hamburger stands and popcorn vendors.
Do our elected representatives not have enough national pride, now that the world is in a financial crisis, to ensure our businesses will not be allowed to be picked up for cents on the dollar and then closed down by non-Canadian concerns?
Even now, Statistics Canada states in a recent communiqué that foreign acquisitions of Canadian-controlled firms, “particularly in mining, manufacturing, retail and accommodation and food services industries, drove the 13.7 per cent increase in assets under foreign control in 2006, the fastest rate of growth since 1999.”
Investment Canada is certainly not overworked. Under the Harper government, in 2008 it reviewed only 28 applications out of 526 foreign acquisitions referred to it. That is 5.32 per cent. The cumulative total since June 1985 that have been reviewed is 1,605 out of 13,178. That is 12.18 per cent.
As a result of the latest political manoeuvres, Ottawa has essentially lost control of Canadian businesses being acquired by foreigners. And the public was not given the opportunity to offer its views on the many non-budgetary items tacked onto the stimulus measures.
“I do not want the bill divided,” Flaherty responded to questions from senators. “You’re making an assumption that the stimulus package is severable. It is not.”
His opinion, however, was neither constitutional nor parliamentary reality.
Canada’s sovereignty has been lessened by a bullheaded government and our future prosperity will suffer.