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Proceedings of the Standing Joint Committee for the
Scrutiny of Regulations

Issue 2 - Evidence, November 18, 2004

OTTAWA, Thursday, November 18, 2004

The Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations met this day at 8:30 a.m. for the review of statutory instruments.

Senator John G. Bryden and Mr. Gurmant Grewal (Joint Chairmen) in the chair.


The Joint Chairman (Senator Bryden): Our first order of business is a budget issue for the House of Commons. Perhaps Mr. Grewal can deal with that matter.

The Joint Chairman (Mr. Grewal): There was a steering committee meeting today to approve our budget. In a moment, I will ask the joint clerk of this committee, Mr. Lafleur, to explain

Our budget is a little less than the previous year's budget. The steering committee does not have any difficulty in approving the budget because it is straightforward. The items included in it are brought forward each year and are almost identical.

Mr. Jean-François Lafleur, Joint Clerk of the Committee: It is an annual procedure to present the budget through the liaison committee and to have it approved. As committee members are aware, the House of Commons has a 70 per cent share of the budget. We will present said budget to the liaison committee with the various rubrics attached. We will have an answer probably today regarding the adoption of the whole budget. If there are any amendments to the budget, we will notify all members of the committee as soon as we have those results.

For your information, the budget was adopted by this committee during the first meeting of this session on October 21.

The Joint Chairman (Senator Bryden): Could you provide us with the numbers in the shared budget?

Mr. François Michaud, Joint Clerk of the Committee: The budget contains the following items: meals, $1,800; hospitality, $1,000; hiring of consultants, $5,000; witness travel expense, $3,000; conferences, $2,500; photocopier rental, $2,500; printing of the agenda, $1,500; purchase of books, $2,500; and miscellaneous, $1,000. The grand total is $20,800. That is the entire budget. As Mr. Lafleur said, the split is 70 per cent for the House of Commons and 30 per cent for the Senate.

The Joint Chairman (Senator Bryden): A note to members of the committee: Those figures will be in your files.

The Joint Chairman (Mr. Grewal): We reviewed the budget at the last meeting and I am told there are likely no changes.

Are there questions? All those in favour?

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): The next item is preliminary to the main agenda. After meeting with the Steering Committee following our last meeting, it was suggested that we take a few minutes at the beginning of this meeting, now that new members have an idea of how this committee functions, to run through some of the parameters.

When I first became involved in this committee, I did not know what was happening. You operate by trial and error until you understand the system. There is a way to at least get us on the right track and, once again, that was in our first report but we do not always read these reports.

Mr. Michaud will circulate a document, in both official languages, outlining the criteria. If you have been a member of this committee before, this information will not be new to you. The document speaks to the mandate of the Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations and was prepared by Mr. Bernier and his office. It states:

The jurisdiction of the Standing Joint Committee (SJC) is defined by its statutory order of reference (s. 19 of the Statutory Instruments Act) and by an order of reference adopted on a sessional basis by the Senate and the House of Commons.

That mandate was in our first report, which has been adopted by both Houses.

Continuing at paragraph 2:

The Statutory Instruments Act provides for the ``review and scrutiny'' of statutory instruments by the SJC. This review is conducted in accordance with the criteria adopted by the SJC (see attached). Although the terms of s. 19 of the Statutory Instruments Act do not preclude review of subordinate legislation on its merits, the criteria adopted by the SJC do not provide for the review of instruments on policy grounds. This approach has been followed since 1974, and is in keeping with that taken in other jurisdictions that have parliamentary scrutiny committees. Among the factors in support of this approach are a desire to promote a non-partisan approach to scrutiny of regulations, the difficulties of securing expert technical assistance appropriate to the myriad of subjects dealt with in regulations, and the fact that standing committees (in the Commons at least) are empowered to review regulations on policy grounds.

The above does not mean that policy considerations are entirely absent from the deliberations of the SJC. In determining whether a regulation represents an unusual or unexpected use of power, (scrutiny criterion no. 11), for example, the Committee might be expected to look into the policy that the regulation is intended to implement. Similarly, a determination that a regulation involves the exercise of a substantive legislative power that is properly the subject of direct parliamentary enactment (scrutiny criterion no. 12), certainly involves policy considerations.

As for the sessional order of reference, it authorizes the SJC to enquire into the principles and practices to be observed in the drafting of enabling powers, the enactment of statutory instruments and the use of executive regulation, as well as the role, functions and powers of the SJC.

If you flip over, and without going into the fine print at the top, the terms of reference as set out by both Houses is as follows:

In scrutinizing statutory instruments on behalf of Parliament, thereby maintaining its sovereignty and supremacy, the Joint Committee uses the following criteria, first approved in their present form by the Senate on November 27, 1986 and by the House of Commons on December 17, 1986.

Whether any regulation or other statutory instrument within its terms of reference, in the judgment of the committee:

1. is not authorized by the terms of the enabling legislation or has not complied with any condition set forth in the legislation;

2. is not in conformity with the Canadian Charter of Rights and Freedoms or the Canadian Bill of Rights;

3. purports to have retroactive effect without express authority having been provided for in the enabling legislation;

4. imposes a charge on the public revenues or requires payment to be made to the Crown or to any other authority, or prescribes the amount of any such charge or payment, without express authority having been provided for in the enabling legislation;

5. imposes a fine, imprisonment or other penalty without express authority having been provided for in the enabling legislation;

6. tends directly or indirectly to exclude the jurisdiction of the courts without express authority having been provided for in the enabling legislation;

7. has not complied with the Statutory Instruments Act with respect to transmission, registration or publication;

8. appears for any reason to infringe the rule of law;

9. trespasses unduly on rights and liberties;

10. makes the rights and liberties of the person unduly dependent on administrative discretion or is not consistent with the rules of natural justice;

11. makes some unusual or unexpected use of the powers conferred by the enabling legislation;

12. amounts to the exercise of a substantive legislative power properly the subject of direct parliamentary enactment;

13. is defective in its drafting or for any other reason requires elucidation as to its form or purport.

Comments on particular statutory instruments are welcome by the Joint Committee. They may be addressed to the Joint Clerks....

I apologize to those of you who know this by heart already.

The purpose is to put a reference point in our files. We can say this is what we are supposed to be doing, that these are our limits and our boundaries.

It is just like a budget, though. This is the last one that was created in 1986, but we cannot go outside of this. We could take it into consideration and decide we will change it, that we will make it bigger, but it is like a budget. You do not break your budget, but you can revise it. However, that would mean going back to each of our Houses.

Mr. Hanger: I appreciate the fact that you put this information forward. It does get very involved. Looking at it from where I sit, it could very well amount to a more in-depth analysis on just about everything that comes before this committee. For instance, does a regulation ``trespass unduly on rights and liberties.'' I point to criterion number 10 as well, which states, ``makes the rights and liberties of the person unduly dependent on administrative discretion or is not consistent with the rule rules of natural justice.'' We can get into in-depth discussions over those two points alone. If we were to look at all regulations in that light, the system would grind even slower.

I do not know if that is necessarily the intent here. I would assume that much of what comes before our committee, when I look at all the paperwork, has been analyzed in that regard already, but maybe not. If we get into a debate on how a particular regulation may impinge upon an industry or an individual, we could carry on for a long, long time.

The Joint Chairman (Senator Bryden): It has been the practice, and I think it is the intention, for this committee to look strictly at the empowering legislation and the regulations made under it, and to ensure that regulations made under the regulation-making power were authorized by Parliament.

I always find it difficult to talk about natural justice and the rule of law. The definition of those concepts is difficult to pin down because they are very broad. We can have an argument on the basis of natural justice because your idea of what is natural justice and mine may differ significantly.

In interpreting those broad provisions, I have found that as counsel goes through the analysis of a regulation, the regulation must technically comply with everything and must not violate the legislation. Someone may administer a regulation and arbitrarily apply provisions of it toward certain groups of people in a different manner than they have applied them elsewhere. That is an example of an issue that may come before this committee, in which case we would ask the following questions: Has there been a violation of our Charter of Rights and Freedoms or the rule of law? Is this guy making the law up as he goes along? Is he being arbitrary?

It has been my experience that the criteria are strictly applied. Therefore, let us not get off track in trying to change an entire parliamentary policy on the basis that we have a problem with an individual who is violating this. We need to take a regulation and strike it down if it cannot be corrected or is not corrected by the department, but we cannot use the review process as a lever to get into a policy or legislative discussion that is far better addressed by the people who are supposed to be doing that, which would be the House of Commons and the Senate.

The Joint Chairman (Mr. Grewal): There are many new members on this committee in addition to the members who have been here for a very long time. I want to make clear that the mandate of this committee is provided by the Statutory Instruments Act. That statute defines the mandate in only two words — the ``review and scrutiny'' of statutory instruments. ``Review and scrutiny'' is a very broad phrase, so many years ago the standing joint committee adopted a set of criteria. This does not mean that the criteria are carved in stone.

The terms of section 19 of the Statutory Instruments Act do not preclude review of subordinate legislation on its merits, meaning that it can be reviewed based on merit, and the criteria adopted by the SJC do not provide for review of instruments on policy grounds. I think if the new members wanted to take time to review the mandate and the criteria, that would be well understood.

Mr. Hanger: I understand clearly what you are saying. The question I have, and perhaps you can help me out in this area, is that last week at least a dozen regulations or changes to regulations came forward in regard to the Canadian Food Inspection Agency. If I were to look at those regulations, I would ask a series of questions.

One example of the regulations that came forward is that the agency wants to regulate the movement of potatoes from one farm to the next. Obviously I would have to ask the question: Why would they want to do that? Does the agency want a broader range of powers that will control the movement of produce, or is there a legitimate reason why they would want to do that? I did ask that question. I wanted to know if the agency wants to, as you put it, grab more power and restrict the rights of those who grow this produce, or whether there a legitimate reason. I did not get an answer. I guess I could say that I will rubber-stamp it and say that it is fine, but I grew up in a rural area and know what it is like to move produce around. I am also aware of the freedom that farmers have to do just that. If they are restricted in doing so, there will be a cost to business.

My worry is that if something comes up and all we do is just look at it and say everything is fine, then we might as well go ahead and rubber-stamp everything on the table. If I were to apply this criteria to every piece of legislation or regulation that comes here, then I would have to have a question on just about everything that came through, for my own clarification, if nothing else. I am not saying that I want to tie everything up, but at the same time, will there be answers to our questions?

The Joint Chairman (Senator Bryden): I will make a comment in relation to the potato issue. Like you, I come from a rural community. To answer your question, you would probably need to go back and look at the legislation behind the regulation. Purposes should be specified in the legislation.

PVYn can be a major problem for the potato industry, particularly the seed industry on Prince Edward Island and New Brunswick. If you are growing seed potatoes, there must be regulations to restrict the movement of potatoes from farm to farm. Because of that, the PVYn virus was restricted to seven acres in Prince Edward Island. It was identified and caught in this process. Then we thought we were past that and we ended up with potato wart, not on the same seven acres but somewhere else. In that instance, I know there was a legitimate reason.

I understand exactly what you are saying. If the regulation in question raises a significant suspicion that this may be a grab for power or may go beyond what the legislation intended, then we could ask our counsel to check the legislative base for this. We could ask counsel to give us an indication that this is not someone off on a frolic of their own.

Indeed, as we go through our agenda, some of the letters in here are very extensive, and that is exactly what is being checked. If members read them carefully, the letter are really testing the people who are trying to wiggle. I use the term ``wiggle'' because they wiggle to make their position fit into already fixed regulations as against having to wait for the long regulation-making process to amend. However, out of this review process often comes the requirement that these people go back and rethink whether this is really necessary. One of the things that happens is that they would rather take it out than go through the agony of running the regulations through the system.

Mr. Hanger: You gave an explanation to a question that I had, which I did not get from counsel last week. We did request it.

The Joint Chairman (Senator Bryden): In fairness, Mr. Hanger, I wonder if I could ask Mr. Bernier to comment.

Mr. François-R. Bernier, General Counsel to the Committee: The only comment I can make, Mr. Chairman, is that I am not a potato farmer; I am trained in law. I look at whether, in the legislation, Parliament told the Governor General or the Canadian Food Inspection Agency that they may make regulations respecting the transportation of seed potatoes. If I see that authority there, I do not have a problem with the regulation, and I do not ask myself why they chose to adopt the regulation. That is a policy issue, which is better addressed either by an expert legislator, and we have them here, or by witnesses from the Canadian Food Inspection Agency.

If a member of the committee has a question like that, and the committee agrees, it can be asked of the agency in a letter.

There is not an unwillingness on my part to answer your question. I simply do not have that expertise.

Mr. Hanger: Just so I have a good, clear indication of what we are here for and how we are to conduct ourselves as a committee, the terms of reference outlined here, which I think are very good, do open the door for questions like I had last week, for which there were no answers.

In reference to that particular question, if I were to evaluate several of the points in the terms of reference, I would have to know what the policy is. If I do not know what the policy is, or if you do not know what the policy is, then we do not move ahead. Is that correct?

The Joint Chairman (Senator Bryden): If there is an issue, we could find out. In many instances you may say it is not an issue, but where there is a significant issue, the very least we can do is examine the legislation or ask the agency involved for the reason behind it and to provide a written reply. If for some reason we think — and it would be a last resort in obtaining more information — that they are trying to twist us around, then we can ask them to come before the committee. However, for the most part we get excellent cooperation from the departments. Sometimes we have to push them and write to their minister.

I visited the offices of our counsel and was shown a CD that had been forwarded from the Department of Justice. All of this stuff has already gone through the Department of Justice. When they cannot win their point that the department has no authority to take a certain action and the department has no right to veto it, in reviewing the disk it became very obvious that the department says, ``You may bully us but you will not bully the Scrutiny of Regulations Committee; they will pick you up.'' It often has the impact of making the departments and the agencies toe the line to their legislation. Am I fair in saying that, Mr. Bernier?

Mr. Bernier: Yes. I showed the senator a CD-ROM, which is essentially a compendium of the committee's case law. It was prepared by the Regulations Section of the Department of Justice and is a neat little tool. You can find the decisions of the committee on any subject or regulation. I take it that the disk is being used by our confreres in the Department of Justice.

The Joint Chairman (Senator Bryden): I do not want to take up our whole meeting with this matter, but I would like members to consider our criteria. If we had not been responsible in drafting the criteria, the catchalls at the bottom would not have been there. The criteria allows for a much wider spectrum than usual.

As a provincial Deputy Minister of Justice, I was involved in these matters. The job of regulations is to implement in a much more efficient way the policy laid out in the statute. A judge's job, in my time as deputy minister, was to determine that the regulations did not violate the powers granted by the legislation. Of course, since 1982 we do have to take into account the Charter of Rights and Freedoms.

Mr. Hanger: I am willing to put this issue aside, but I do have some questions I would like to ask you right after the meeting, if I may. It may not be of benefit to the committee, but it will certainly be of benefit to me and will allow the committee to move forward.

The Joint Chairman (Senator Bryden): Certainly.

Mr. Anders: If we have just received this document and if there are some questions concerning the mandate criteria of the SJC, should we not table this and set this aside?

The Joint Chairman (Senator Bryden): We did not just receive this document. This is an excerpt from the first report of this committee and was dealt with at our first meeting. I know that you were present at that meeting when it was reviewed. Other items are in the report, such as the budget, and I believe it was adopted by the Senate and by the House of commons that same week.

The Joint Chairman (Mr. Grewal): It was not on the agenda when we received it last night. We learned today that we would be reviewing it.

The Joint Chairman (Senator Bryden): I think we need to come back. It was used as an aide-mémoire for the members of the committee. Everyone has it in his or her file, including me, but we do not always read every piece of paper in our files. Bringing this document forward today was an attempt to highlight it to generate just this kind of discussion. Members should have an opportunity to review the document and we will come back to it.

The Joint Chairman (Mr. Grewal): We have one quick comment before we proceed with the agenda.


Mr. Bouchard: This concerns the criterion which states ``purports to have retroactive effect without express authority having been provided for in the enabling legislation.'' Do we often come across cases where regulations have a retroactive effect?


The Joint Chairman (Senator Bryden): I will ask counsel to respond to that question.


Mr. Bernier: In fact, there have been fifteen or twenty such cases over the past 20 or 22 years. This is a well-known rule of law and attempts are rarely made to override this rule.


The Joint Chairman (Mr. Grewal): Let us move on to the first item on the agenda.



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

Mr. Bernier: In their April 28, 2004 letter, the joint chairmen requested that the minister provide a precise timetable for the making of the amendments requested by the committee or to agree to proceed with them independently of the comprehensive global review of the regulations that had been mentioned in the minister's earlier letter of March 2003.

In her reply of June 9, Minister Bradshaw indicates that she has instructed her officials to proceed with the amendments requested by the committee ``separately and as quickly as possible.'' With the agreement of the committee an inquiry will be made as to the current status of those amendments.

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

Hon. Members: Agreed.



The Joint Chairman (Mr. Grewal): The next item under the heading of ``New Instruments'' is SI/2003-117.

Mr. Jacques Rousseau, Counsel: Counsel for the committee suggested a better way of drafting this amendment. No reply was requested and no further action is required on the committee's part. This file can therefore be closed.


The Joint Chairman (Mr. Grewal): We continue with the next item, SOR/2003-86, under the same heading ``New Instruments.''

Mr. Rousseau: Regarding this file, committee counsel again suggested a way of listing amending instruments in the Consolidated Index of Statutory Instruments. The letter of May 25, 2004 confirms that this suggestion will be acted on. Therefore, there is nothing more for the committee to do and this file can be closed.


The Joint Chairman (Mr. Grewal): The last item under the heading ``New Instruments'' is SOR/2003-88.

Mr. Rousseau: The date on which this amendment was adopted was not noted in the Canada Gazette. The Public Service Commission provided the documents allowing us to complete the review of this amendment. So again, this file can be closed.


The Joint Chairman (Mr. Grewal): We will move to the next item under ``Reply Unsatisfactory.''


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

Mr. Bernier: The fees applicable to national parks used to be fixed by means of regulations. In the 1990s, this approach was abandoned and the minister was given the authority to fix fees by means other than regulation. There remained an obligation to publish any fees fixed by the minister, and these have since then been published in Part I of the Canada Gazette. The relevant legislation also provided that any fees fixed by the minister would stand referred to this committee, even though they were not made by way of regulation.

The examination of the fees was hampered by the fact that it quickly became apparent that the department simply had failed to put in place internal procedures designed to ensure that the fees and any amendments to the fees were made in a way that allowed us to establish that they had been made validly by the minister. The documentation simply was missing.

The lack of these procedures meant that in a number of instances the department found itself unable to provide evidence to counsel and to the committee to show that the fees had in fact been made by the minister, as required by statute. The committee recommended to the department that it should consolidate all existing fees and proceed to have the minister make those fees in order to put all national park fees on a sound legal footing. The committee also recommended that to avoid the problems created in the past by repeated amendments to the fees that were poorly documented, the department should consider having the minister remake all fees on an annual basis. The first of these suggestions was accepted but the second was not.

The 2003-04 list, as previously published, was presented to the minister and she was asked to approve it, which she did. The process under the act, of course, is that the minister first fixes the fee and then the fee is subsequently published. In this instance, they reversed the process.

Legally, that is more or less satisfactory. The purpose of publication is to ensure that the attention of those affected by an instrument is drawn to that instrument. I suppose that objective has been achieved. It would be a little pointless now to say that the fees, as approved by the minister, were published in Part I, but please republish them to respect the statutory sequence. We suggest that the solution, or what the department did in this case, be accepted as resolving the issue of authority.

In an examination of the 2003-04 consolidation of fees, it was pointed out to the department that a number of previously established fees had apparently been rescinded or dropped. They did not appear in this new consolidation.

When we asked for evidence that these fees had in fact been rescinded by the minister, as they ought to have been, the department candidly acknowledged that the fees were removed but the required ministerial approval was not obtained, on the ground that the master list was already so voluminous that it was decided to omit the deletions. The result, of course, is the minister never approved those deletions.

We suggest that the minister's approval of a complete new master list can possibly be seen as affecting the implied repeal of fees previously established but not repeated in the latest master list. Again, this is not an ideal way of proceeding, but in the interests of moving forward, we suggest the committee accept this recommendation.

The file illustrates the very serious problems that result from some of those so-called deregulation attempts. The regulatory process that was previously required to be followed for the establishment of fees provided for a disciplined, orderly procedure which ensured that the requirements of the law were observed and the fulfilment of legal conditions was properly documented.

When this model was abandoned, the result was an almost complete breakdown of the mechanism designed to verify compliance with the law. This created a situation in which it became nearly impossible to verify that fees were properly imposed on Canadians in accordance with the law.

While counsel still believes that it would be preferable for the department to re-enact fees on an annual basis, for reasons I have mentioned, the department is not willing to take this approach. I suppose time will tell who is right and whether the procedures that the committee has been assured have now been put in place administratively within the department will be sufficient to ensure that fees are fixed properly from now on.

Senator Moore: Would it not be appropriate for the committee, or the joint chairs, to write to the department and to set out the message from the committee as per counsel's comments? We could say that if we do not find it to be a satisfactory process, we will go for this 2003-04 list in the interests of moving things forward, but do not consider this to be a precedent. We want it done properly hereafter.

The Joint Chairman (Mr. Grewal): All right.

The Joint Chairman (Senator Bryden): That is an appropriate thing to do.

Senator Moore: I am just asking.

The Joint Chairman (Senator Bryden): Doing the list every year, is that an exceptional weight to put on the department, or is it no more difficult? Perhaps counsel could you answer that question.

Mr. Bernier: The department seems to feel that it would be difficult. In this day of computers, I find it a little difficult to understand why it should be so difficult, if a fee has been changed, to simply put it up in a gazetted version. That is their choice, in a sense.

The committee made a suggestion that it thought would be helpful in terms of process. If they do not want to follow it, they are the people to whom the power has been delegated. I suppose we have to accept that.

I think the senator, however, has made a valid point. I would counter-suggest that a letter from the chairmen go to the minister, indicating that in the interest of putting this matter behind the committee, the committee will accept the practical approach suggested by the department.

Senator Moore: For the 2003-04 list, but thereafter we expect it to be done in a more open fashion for the benefit of all. Do we need a motion to that effect?

Mr. Wappel: Frankly, I do not see the need to republish fees yearly. I see the need to publish fees when they are changed. For example, if the admission fee to a national park is set at $10 in the year 2004, then the admission fee to the national park is $10 until that fee is changed or revoked. I see no purpose in republishing that on a yearly basis. It is just extra work for the department.

However, it is clear to me that that fee cannot be revoked, decreased or increased without the permission of the minister. I think that is the point counsel was trying to make. I would not go so far as to require the republishing of every single fee every single year, but rather only changes.

With respect to what counsel said earlier, if we were to accept this approach — and I agree that we can and should — it would not be a huge exercise to add a sentence to the list of fees stating that ``any fees not mentioned herein remain the same.'' That is it. One can refer back to previous times.

On a procedural question, in the agenda we receive showing the items we will consider, this item appears under ``Reply Unsatisfactory.'' I do not want to make a lot of noise about this for new members, but normally, given what counsel said, this item should have been put under ``Reply Unsatisfactory(?)'' because, in effect, counsel is accepting the proposal or recommending that we accept the proposal and it is therefore not unsatisfactory; it is unsatisfactory, question mark. I am just wondering if counsel had given that any thought.

Senator Moore: Question mark in brackets?

Mr. Wappel: This is just a lesson for new members as to what goes on here.

The Joint Chairman (Senator Bryden): It gets more intriguing as time goes by.

The Joint Chairman (Mr. Grewal): Should we write a letter as suggested?

Hon. Members: Agreed.

Mr. Hanger: Will Mr. Wappel's comments be included in that letter?

Mr. Wappel: Mr. Hanger, that is up to the committee.

Mr. Bernier: As I understood the senator, the two issues that would be raised are those where, in terms of the solution brought forward, there is a legal question hanging over the course of action. The decision to not have an annual consolidation does not involve a legal issue at all. That is an administrative decision. The committee made a suggestion that the department has not accepted. I did not take it, from what Senator Moore said, that this matter would be commented on but it can be, if only to indicate that if there is a need, other than on the record of this committee, the committee accepts that that is the department's choice.

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

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): There is a similar regarding the Parks Canada Master List for 2003-04. Do we want to deal with it later on, or do we want to go in sequence?

Mr. Bernier: In sequence, Mr. Chairman.


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

Mr. Bernier: This file will be more to Mr. Wappel's liking, I assume, Mr. Chairman. The correspondence on this file is a textbook example of a government agency disregarding the law on the basis of policy considerations.

The Canadian Grain Commission is usurping the role of Parliament in making itself the judge of whether section 68.1 of the Canada Grain Act is still required, given changes in the grain industry. This is a judgment for Parliament to make, not for the Canadian Grain Commission to make.

Contrary to its assertion, the Canadian Grain Commission was not given a discretion to decide when section 68.1 of the act would cease to apply. That is, in fact, the authority it is claiming when it asserts that it has a right not to prescribe any period for the purposes of that statutory provision. In other words, the commission is claiming for itself the de facto authority to set aside the statutory provision through not making a regulation prescribing a time period.

I believe the committee should pursue this matter with the responsible minister and ask him to make it clear to the Canadian Grain Commission that it is Parliament, not the commission, that is the judge of whether the policy requiring producers to pay out their grain within a fixed time is still desirable. The issue is one of vires. It would be a case where it would be appropriate for the committee to also argue that the making of this amendment involves an unusual or unexpected use of the enabling authority granted by Parliament.

The Joint Chairman (Senator Bryden): Are there questions? Agreed?

Hon. Members: Agreed.

Senator Moore: I understand that we will write to the minister.

Mr. Bernier: That is right.



Mr. Rousseau: In their letter dated September 9, 2004, the department announced for the first time that the Chlorobiphenyls Regulations would be repealed and new regulations developed. Judging from the timeframe mentioned in the letter, our guess is that the promised amendments will be adopted in 2005 at the earliest.

I would like to mention in passing that in the original version of the letter, the department noted that the new regulations would not be completed until next year, whereas the English translation states that this process will not be completed before the end of next year. This introduces a new timeframe. I would point out, however, that we are dealing with two separate amendments respecting the drafting of the regulations. This is one instance in which we could continue to be patient. If the committee agrees, counsel will monitor developments as it usually does and keep the committee apprised of the situation.


Mr. Rousseau: The committee learned in a letter dated April 29, 2004 that the Transportation Safety Board of Canada is exploring the possibility of amending the Canadian Transportation Accident Investigation and Safety Board Act, which would mean putting any proposed amendments to the regulations on the backburner.

A total of six amendments had been promised, one of which involved an illegal provision. Under the circumstances, it would be advisable nevertheless to ask the Board to specify the date by which the promised amendments will be made. If the committee agrees, counsel could send a letter about this matter to the Board.



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

Mr. Bernier: Once again, we are looking at the same master list of fees. This file focuses on some of the actual fees that have been imposed. First, I should note that action is promised on the issues raised in points numbered one and five of Mr. Bernhardt's December 9 letter. On the other three points, I would suggest that the reply under paragraph number 3, regarding the parking charge, be accepted as satisfactory.

Under point two, the fee imposed for the issue of a licence to sell alcohol takes the form of a percentage of alcoholic beverage purchases by a business in the park. The legality of this charge was queried in relation to a previous list of fees and the department conceded at the time that the charge was not appropriate. That was the term used, ``appropriate.'' The committee, perhaps wrongly, took this as an admission that the department agreed with the committee that this charge was in the nature of a business tax, which would not be authorized under the Canada Parks Agency Act, rather than a fee-for-service provided, which is authorized.

When the same charge appeared in this list of fees, the committee asked the agency not to collect it until such time as the provision was amended. Faced with this request, the agency now states that its earlier response was misinterpreted in that while it agrees that there may be better ways of establishing this fee, the current fee is nevertheless legal.

As advisers to the committee, counsel maintains the view of the committee that a charge made to turn on the volume of business under a licence is a business tax and is not a fee for the issue of a licence. Unless it is expressly authorized by statute, it is illegal.

The second unsatisfactory reply concerns the fee imposed for impounding animals found running at large in the parks. Again, the authority is to charge fees for services. These fees are now described as fees for boarding. The claim is that this is a service provided to pet owners. One might as well argue that inmates of penitentiaries are not imprisoned but are simply being provided lodging services by Her Majesty.

I suggest to the committee that this stretches the ordinary meaning of the concept of ``service'' beyond what is acceptable and that this issue should also be pursued with the department.

The Joint Chairman (Mr. Grewal): Does this kind of fee fall under tier one or two, or is it a different kind of fee? In the first issue when the department argues that this was a fee, their original communication was misinterpreted. I want to clarify the kind of fee that we are talking about. Is it a fee like the ones we discussed in respect of broadcasting, for example — tier one or tier two? At that time we learned more about different kinds of fees.

Mr. Bernier: You are referring to the Treasury Board classification of fees. I would have to look at that because I do not know how the government would classify such a fee.

The Joint Chairman (Mr. Grewal): If it is fixed to recover the cost of operations, would they do it differently?

Mr. Bernier: It is and it is not thus. One can accept that the amount of money collected from these fees can be considered a business tax because it is based on the volume of alcohol purchased, which is another way of getting at the alcohol sales, essentially. Presumably businesses do not purchase alcohol unless they can sell it. The amount collected does not exceed the costs of the Canada Parks Agency so it is within cost. However, we have to look at the nature of the charge. This is supposedly a fee for the issue of a licence. At the time this licence is issued, no one knew what the volume of alcohol purchases would be. Perhaps we take it on the purchases of the previous year and take 5 per cent of that figure.

In issuing the licence there is no correlation to costs. For example, the national parks regulations used to include different levels of fees set in accordance with how many seats were in a bar. If a bar could seat between 10 and 50 occupants, based on the approved occupancy of the business, and the larger establishments paid a higher fee for the licence, that was fine. All the parameters are fixed at the time the fee is paid. One knows it is a licence for this establishment, at this location, and here is the approved occupancy level. You are being charged on the basis of your sales, essentially, because even though it is in terms of purchases, eventually it is your sale. That has always been considered a business tax; that is what they are.

The Joint Chairman (Senator Bryden): I understand, but is there no legitimate basis in the regulations that would allow the parks authority to recover the cost of keeping the animals that they have picked up who are strays? It may be forced boarding; nevertheless, when the owner comes to pick up the animal, if it has been there for a week, it has cost something to feed it. If it was a car that they impounded, there would be a cost.

I can understand the word is wrong. It is not a voluntary thing, but it is not like attaching a fee that ranges with the amount of volume, as in the case of alcohol. I think you are absolutely on the wrong ground there. Is it worth taking a look to see if there is something that would allow for cost recovery?

Mr. Bernier: The authority is that the minister may fix the fees or the manner of calculating the fees to be paid for a service or the use of the facility provided by the agency.

I suppose it could be said that if your pet is being kept at a facility, you are using the facility. There is a use of a facility provided by the agency. Is it a use that allows the government to impose a fee?

We have always, and the committee has always, looked at these types of enabling authorities as involving an element of voluntariness. In other words, if we are talking about a service, it is because a citizen has requested the service or has requested the use of a facility. In this case there is no voluntary element at all. No one is questioning that the animal is seized and impounded for good reason.

The Joint Chairman (Senator Bryden): In a sense, is that not a service to the people who inhabit the park?

Mr. Bernier: Then perhaps they should pay the fee.

The Joint Chairman (Senator Bryden): Another solution is to shoot the dog. What is the solution?

Anyway, I am doing what I should not be doing.

Mr. Wappel: No, I think you are doing what you should be doing, Mr. Chairman. I agree with you. I think that the element of voluntariness for the person entering the park is the choice to bring their pet into the park. If they choose voluntarily to bring their pet in, and somehow that pet is lost, a domestic animal in a national park is a danger to wild animals, or certainly can be argued to be so. I do not think it should be called boarding; I think it should be called an impoundment charge, or however you want to phrase it. If someone inadvertently or negligently allows their pet to escape their control in a national park and it has to be caught and looked after by park staff, I have no difficulty with that cost being recovered from the owner.

Senator Moore: What Mr. Wappel says makes sense. What if you lost your pet and did not know it? The pet could be dead in the wilderness. There is no contract between the owner and the authority. Is there something posted when you enter the park or when you sign in? Is this one of the things that you agreed to? What if you lose a dog and a couple of days later, in checking to see if they found it, you are told that you owe $50 a night. What is the basis of that? In signing into the park, did you agree, in the event that your animal got loose and the park officials retrieved it, that you would pay the boarding and impounding fee? Was that set out? What is the authority for that? What notice is a citizen given that he or she may have to pay if this situation occurs? Where is the contract?

Mr. Bernier: I suppose if one was adamant and wanted to find a contract, you could say the notice setting out the fee has been published in the Canada Gazette, Part I.

Senator Moore: So everyone has a stack of these.

Mr. Bernier: Everyone reads in Canada. Part I is the official gazette of the government; it is a very interesting newspaper. Having read it, in entering a park, people are by implication requesting the boarding or impoundment of their animal should it happen to run at large. That is the best I can do for you to find a contract.

The Joint Chairman (Mr. Grewal): Where do we go from here?

Mr. Anders: Another way to look at it is that the contract is made with the rest of the public. When people go to enjoy a park, they do not expect to be bothered by someone else's animal. There is a flip side.

I agree with Mr. Wappel that the voluntary nature of it is such that you are bringing something that you own into the park, and if it is causing someone else problems and the state has to impound it, then they have to recover costs. If it was not an animal but, let us say, a noise-making device or an engine that backfires, and the park felt that it had to confiscate it or somehow look after it in some way, you could be paying a fee for parking the vehicle or whatever it is in that case.

I think they are probably going along the right path with regard to animals. I do not agree with their approach on alcohol.

I wonder what the cost recovery mechanism is with regard to animals and whether that recompense they get for the impounding goes directly back to them for compensation, or does it go to general revenue? Where does it go?


Ms. Guay: As a rule, owners are responsible for their pets. If a pet runs at large, most municipalities will catch and impound the animal. The owner will then be required to pay a fine to get the animal back. It is normal for owners to be responsible for their pets. If I go to a park and my pet runs off, it is unfortunate, but I will have to go the pound and pay to get it back. I do not see the problem.


The Joint Chairman (Mr. Grewal): I see a consensus.

Ms. Wasylycia-Leis: I would like to ask counsel's advice. The emphasis in the notes is on the fact that the legislation itself does not authorize such fees. Given the role of this committee to ensure that regulations are in line with legislation, is there an issue here that we have not addressed fully?

Mr. Bernier: Obviously, a number of members feel that this can conceivably be seen as a fee-for-service. The department thinks it is so and will be glad to hear that a number of committee members also think it is so. We are here to advise the committee and serve the committee. If the committee wishes to reach that conclusion, it is perfectly proper. Then we would pursue the item under the business tax of the liquor sales, that aspect of the fee, and the reply of the department will be accepted as satisfactory on this business of impounding and boarding. It is a bit of a stretch on the concept of service, but it is not wrong.

The Joint Chairman (Senator Bryden): I used to sell insurance. They said that once the contract is sold, be quiet so you do not talk yourself out of it.

Presumably, as done with other fees, these fees could be posted at the entrances to the parks, such that the care of an animal in their pounds is $50 per day, for example. It would be quite unreasonable to know what the animal weighed going in and going out.

I would ask counsel to consider whether there is something that could be done somewhat easily with the regulations that would make this absolutely kosher from his point of view? If so, then suggest it. Otherwise, let us proceed and do as the committee suggested, if it will be enforceable.

The Joint Chairman (Mr. Grewal): Is there agreement that counsel draft the issue on pets and follows up with the tax?

Hon. Members: Agreed.





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

Mr. Rousseau: For your information, 59 points were initially raised by the committee pertaining to SOR/98-2 and SOR/99-169 and a total of 11 amendments were made. Letters continue to be exchanged concerning a number of these points, including the letter in question this morning. Except for those points that I will be addressing today, the letter of August 3, 2004 from the Canadian Food Inspection Agency contains promises to move forward with the amendments. Therefore, the reply can be considered satisfactory.

As for SOR/99-169, the letter dated August 3, 2004 does not contain a reply to the question raised under paragraph one of points 14, 18 and 24. The CFIA informs the committee that is has not completed its consultations. Nor does it provide a reply under paragraph 2 of points 15, 23 and 38. Regarding points 22 and 24, the CFIA announced planned amendments, but it not clear about how it intends to resolve the problems identified. Obviously, committee counsel will be writing to the CFIA again to obtain a more detailed reply to the points raised. Furthermore, it would be advisable to write back to the CFIA to request further clarification on two other points, namely paragraph 2 of point 12 respecting SOR/98-2 and point 11 respecting SOR/99-169. In the first instance, there is no way of knowing from the reply provided what the CFIA's exact intentions are. In the second case, the CFIA merely restates its previous reply, without addressing any of the arguments put forward by counsel.

The other points mentioned in the correspondence have to do with two aspects of the Fish Inspection Regulations on which the CFIA and the committee disagree. The first concerns the various provisions in the regulations that require operators of establishments to keep records or to report back to the Agency on activities that are part of the normal course of business. This element is discussed on page 2 of committee counsel's letter and the reply commences on page 2 of the CFIA's letter. The committee is of the opinion that the legislation does not allow for such requirements to be set out in the regulations. The CFIA cannot base its position on any substantive legislative provision. It tries to give a general explanation to the effect that the power to adopt these provisions stems from the nature of the activity in question and that certain enabling provisions can thus be interpreted as granting sufficient authority. In essence, this reply shows why the act needs to be adapted to the present situation.

The inspection regime that Parliament has provided for in law no longer appears to be adequate or appropriate and efforts are being made to bring in a system that will involve operators or establishments. Basically, if the CFIA truly wants record-keeping requirements to be imposed on operators of establishments, then the act must first be amended.

The second area of disagreement is the requirement that only establishments registered in accordance with the Act can carry on activities. This matter is discussed in point 3 on page 4 of counsel's letter, and on pages 3 and 4 of the CFIA's reply.

The committee is of the view that the act does not provide for the creation of a regime that transforms the right of an establishment to carry on activities into a privilege that depends on its registration. This principle lies at the heart of the debate. Parliament did not decree in the act that activities could only be carried on in registered establishments. None of the enabling provisions cited by the CFIA clearly assigns authority to impose this kind of scheme by way of regulations. The provisions of the act do impose requirements on persons who carry on activities pursuant to the act and violators can be fined. However, these provisions do not allow for requirements to be imposed prior to the activities being undertaken.

As for the last two paragraphs in the letter, counsel for the committee recommends that the Chair write to the Minister to stress the need to review the legislation to bring it in line with current market conditions.


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

The Joint Chairman (Senator Bryden): That was a lengthy and complicated presentation, of necessity. Some people on the committee may wish to follow up on that item. The solution would be to obtain a copy, in English and in French, of what was just presented. Perhaps it could accompany this lengthy correspondence in the event that someone who did not understand all of the presentation could return to this agenda item a few weeks from now.

Senator Hervieux-Payette: I understand that this will be printed in the minutes of the meeting. Most often, these presentations are done in English. I understand your concern, but once in a while we have a French presentation.

Each meeting we receive hundreds of pages of documentation. Receiving additional pages would cause me concern, although I am not saying that we should not understand the material. Mr. Rousseau read quite slowly, and most of the arguments are in the English version of the document as well. He was simply emphasizing that the committee maintains the same position. I am already overwhelmed with documents, and that is my biggest concern. The previous letters sent are provided to us in both languages. We generally receive the information a few days before the meetings.

The Joint Chairman (Senator Bryden): I am not suggesting that this be circulated to the committee.

Senator Hervieux-Payette: We have the text. If we want to revise it, we can do so.

The Joint Chairman (Senator Bryden): When?

Senator Hervieux-Payette: The minutes are always printed soon after the meeting.

The Joint Chairman (Senator Bryden): My point is to make members aware that if the need for further detail arises, they can request the blues, and we have the correspondence, as it was circulated. I am not suggesting that all members be sent the blues.

The Joint Chairman (Mr. Grewal): The suggestion is simply a reminder to those new members who want additional access to the blues or to the minutes. Members have options in that regard. Those who need the extra help can have that delivered to them.

I think this is quite complicated. Out of 59 recommendations, only 11 changes were made. Do members agree with counsel's recommendation?

Hon. Members: Agreed.



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

Mr. Bernier: Mssrs. Chairmen, the committee was concerned as to why some steps in the grievance process were not required to be taken as soon as practicable when all other steps in the process were. The reference is to the procedural steps set out in sections 76, 77(1) and 79(1) of the regulations. The department has responded with the explanation that the obligation to provide an inmate with a decision in a section 75 grievance as soon as practicable means that all intermediate steps leading to that decision, including those set out in sections 76 and 77, must also, by necessary implication, take place as soon as practicable.

While an express statement may be thought to have been preferable, we believe there is value to the argument that has been made and we would suggest that it be accepted. As regards section 79(1), however, the department now proposes to add the words ``as soon as practicable'' to that section as requested by the committee.

As regards the points raised in respect of sections 125, 128 and 129 of the regulations, a review of the committee's comments and of those sections has yet to be completed. The committee is assured, however, that its comments on the relevant provisions ``were well-received and remain an important element of the review.'' The committee is to be kept informed of the further progress of that review.

The Joint Chairman (Mr. Grewal): Are there comments? Is it Agreed?

Hon. Members: Agreed.



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


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


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


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




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

Mr. Bernier: With your permission, I will deal with all of the files under the headings ``Action Promised'' and ``Action Taken'' as one item. Under the heading ``Action Promised,'' the committee has an undertaking that a discrepancy between the two versions of section 9 of SOR/2001-494 will be corrected.


Under the heading ``Action Taken,'' four illegal provisions have been formally revoked and one amendment has been made to correct a practical problem with the application of the National Parks of Canada Water and Sewer Regulations. Under this heading I wish to draw the attention of members of the committee to amendments to the National Battlefields Park By-law. A number of significant amendments have been made at the request of the committee and as a result of the work of the committee. Of particular note is the fact that in some instances this instrument takes action on concerns particularly in respect of unjustifiable restrictions on freedom of speech that were first raised some 27 years earlier.

There are 89 instruments submitted without comment.

Mr. Wappel: We got the job done.

The Joint Chairman (Mr. Grewal): May I remind members that the December 2 meeting will be televised, for which there will be further notice. The steering committee met to discuss reviewing the recommendation we received for regulatory reform involving the PCO, the so-call Smart Regulations. We will come back to the committee on that later.

Mr. Hanger: I assume that the formal meeting is now complete. I do have some questions.

The Joint Chairman (Senator Bryden): Do you want to stay on the record?

Mr. Hanger: I do not mind staying on the record. Adjourn your meeting, but I want to stay on the record.

The Joint Chairman (Mr. Grewal): Please proceed.

Mr. Hanger: In looking at the criteria that were presented as guidance for this committee, I want to use an example that seems to apply when it comes to the actions of the committee in dealing with regulations. I will point out the area that I think is appropriate. This concerns the DNA policies that came out of government two or three years ago and the impact that the regulations had on municipal and provincial agencies to fund their own operations for the collection of DNA. None of it was ever supported by the federal government, but they left and imposed a substantial debt burden on the different agencies and provinces.

Is this an area that a committee such as ours would look at in terms of the costs of federal policy that is placed on the shoulders of the provinces and municipal agencies?

The Joint Chairman (Senator Bryden): The answer would be no. In my opinion, with our terms of reference, it is not likely something that we would look at. We would normally look at the statute. Are you talking about a Criminal Code issue?

Mr. Hanger: Yes.

The Joint Chairman (Senator Bryden): The compliance of the regulations with the provisions of the statute empowering the making of regulations to deal with the collection of DNA — the ability to do that and the funding of it — is not within the purview of this committee. We tend to concern ourselves with the legality of the regulation as it applies to the individual. That is my opinion, although others here have more experience in this area. Mr. Lee or Mr. Bernier may wish to comment. If a municipality has a complaint, presumably it is because they cannot do what they are directed to do until such time as they receive financial assistance.

Mr. Hanger: The policy goes through the House and then the regulations are drafted. There is always a substantial cost to bear when initiating a collection of samples and being expected, on a local level, to follow the regulations so that the system works. The issue was not discussed anywhere, including in the House, as to who would pay the start-up costs. I am sure you can appreciate the fact that any agency, police or other, has a tightly restrained budget that will be affected when regulations are imposed.

Millions of dollars of additional costs thrown on top of an already tight budget bites hard into those available funds just for operational costs. Someone has to bear them. It was most unfair that local agencies had to bear that entire cost. That could have been addressed. It does hit on possibly two or three of the criteria that were presented at this committee.

The Joint Chairman (Senator Bryden): Mr. Anders and Mr. Lee, I was on the Standing Senate Committee on Legal and Constitutional Affairs when that was legislated and can attest that this issue was never discussed. We had dozens of witnesses appear before us — municipal police, mayors and many others — and no one ever raised that point. Whether we are the committee that should address the issue, I do not know.

Mr. Hanger: I am looking by way of example. If we impose regulations on an agency outside the federal government, I think there then has to be some discussion because it does fall under this criteria. I am using this as an example of what has happened in the past. I am not saying we have to redress it now or make a correction to it.

The Joint Chairman (Senator Bryden): There are more examples than just this one.

Mr. Hanger: There are many examples.

Mr. Anders: One could argue that it would violate the sense of natural justice should one level of government impose fees or costs upon another level of government. I imagine that within our criteria one could possibly find a rationale, such as being ultra vires, for a certain jurisdiction of government to impose budgetary constraints or problems on another jurisdiction. My sense, however, is that under natural justice alone there probably would be some leeway.

Mr. Lee: I am sure counsel will correct me if I am wrong, but on the basic issue of the House adopting statutory reform, this committee generally does not deal with any of that. That is the business of the House and the appropriate standing committee would deal with those issues. This committee is focused on the regulatory piece that follows the adoption of a statute, and in this case there were regulations. The committee looks for compliance with our criteria.

One of the areas where we follow compliance is in adherence by the department or by the government to the regulatory process that is in place for the adoption of new regulations. That includes prepublication, consultation with stakeholders and that kind of thing.

There have been instances in the past where the committee has actually looked in greater detail at adherence and non-adherence to that process. It is arguable that where there was a conspicuous and material non-adherence to the process, you might have an unusual or unexpected use of power or some other defect that the committee might wish to weigh in on.

However, other than that, the committee would, straight up, use its criteria in looking at the regulations. Cost implications are not normally a part of our criteria provided for the fees imposed or that they are properly imposed in accordance with the legislation. Indirect economic impacts of a new regulation or statute could be considered, but that would normally be dealt with in the regulation adoption process and the procedure that is already set out in the consultation process in the prepublication.

The general answer is that we might address it if there were a defect in the process or in the steps that were taken in implementing the new regulations. Other than that, the costs imposed are a policy issue. We would not normally address that issue unless there were technical legal defects.

Mr. Hanger: In all fairness to any committee that may scrutinize regulations, I would suggest that there must be an examination at this level of the impact. I know that the criteria do not specifically say this, but it can be construed that two or three of these points will directly impact the analysis of how an agency or municipality may be affected.

Mr. Lee: In this case, Mr. Hanger, it would be possible for you and I to look at the regulatory impact analysis statement, or RIAS, that accompanied the implementation of those regulations. If the RIAS addressed those financial issues to which you have referred, then we would normally consider those as being adequately dealt with by the process. If the RIAS did not mention it at all, then one could question whether the RIAS was adequately done.

Mr. Hanger: I think that would be a fair analysis. This issue would be open for examination at that point.

Mr. Lee: Yes. Perhaps you could look at the RIAS that accompanied those regulations or ask counsel to look at it.

Mr. Hanger: Could we obtain those for the committee?

The Joint Chairman (Senator Bryden): Certainly. Depending on the outcome, we could then address the matter of this committee doing anything about it.

Mr. Hanger: That is fair.

The committee adjourned.

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