Notes for an address by Honourable Judy A. Sgro, Privy Council
Member of Parliament, York West
Opposition Day Motion

Gas Prices

Tuesday, May 8, 2007

Thank you, Mr. Speaker; I am very pleased to participate in this extremely important debate this afternoon.

Today, we have the following motion before us:

That, in the opinion of the House, the government should move an amendment to the Competition Act so that the Commissioner of Competition have the power to initiate investigations of the price of gas and the role of refining margins in the determination of the said price.

I would like to begin my remarks by reminding Honourable Members about the current role of the Competition Bureau and of its present mandate.

The Competition Act contains regulations that ensure Canadians are treated fairly in the marketplace and that corporations in positions of market dominance do not abuse their status to the detriment of consumers.

The Competition Bureau is an independent law enforcement agency responsible for the administration of the Competition Act, which includes provisions against price fixing, price maintenance and abusive behaviour by a dominant firm resulting in a lessening of competition.

The Competition Bureau’s role is to protect competition in the marketplace so that Canadians can benefit from competitive prices, product choice and quality service.

All of its provisions apply to gasoline and other petroleum products.

Each year, the Bureau receives numerous complaints about gasoline prices. Complaints are examined to determine whether the provisions of the Competition Act have been violated.

Since 1990, the Competition Bureau has conducted six major investigations into allegations of collusion in the gasoline industry.

But, Mr. Speaker, it has consistently found no evidence to suggest that periodic price increases resulted from a conspiracy to limit competition in gasoline supply.

Instead, it has always found that market forces such as supply and demand and rising crude oil prices caused the price spikes. In fact, after each increase prices fell to normal levels.

But the Competition Bureau has limitations.

It does not possess up-to-the-minute information on all developments in the world-wide petroleum industry. And, it is not the Bureau's mandate to conduct ongoing economic research and analysis of developments in the petroleum sector of the economy.

Today’s motion calls on the government to amend the Competition Act so that the Commissioner of Competition would have the power to initiate investigations of the price of gas and the role of refining margins in the determination of the said price.

I would like to be clear to everybody watching at home that the federal government does not control the price or distribution of most goods and services sold in Canada - including gasoline.

Where prices are not regulated they are determined by market forces.

That being said, I understand that Canadians are seeing gasoline prices rise and that people are upset at what they see as unfair prices and taxes at the pump.

Gasoline pricing is one of the most talked about and studied consumer-related issues in Canada.

Just last week, this issue was raised to me at a local meeting of the North Islington Seniors.

Seniors who are on very limited, fixed incomes simply cannot afford to pay the astronomically high prices that we have seen lately. Just putting gas in the car to get to their appointments is creating hardship in their lives.

High gas prices affect all Canadians. From the trucking industry that delivers food to our grocery stores, to low income families trying to make ends meet, rising gas prices are creating strains on budgets across the country.

Mr. Speaker, it’s not just the rising price of gasoline that is affecting my Constituents in my Riding of York West.

The price of natural gas, which has almost doubled since last year, will hit senior citizens hard this winter.

The Ontario Energy Board has approved a 19 per cent increase in natural gas prices to reflect the rising cost to distributors. With this increase, rates will have risen 45 per cent since October 1999.

That translates to about $430 a year per residential customer. Seniors on pensions simply cannot afford another $400 or $500 dollars to keep warm this winter.

The volatility of gasoline prices and recent high fuel prices continue to generate discussion about market fairness and the competitive nature of the retail gasoline market in Canada.

The Liberal Government understood that the majority of the pump price of gasoline comes from the price of crude oil, a globally traded commodity.

The Liberal Government acted to diversify our fuel supply. Some examples include:

• We supported initiatives that will diversify Canada’s fuel supply such as Alberta’s oil sands, Hibernia in Newfoundland and Labrador, and Nova Scotia’s Terra Nova
• We worked toward increasing performance standards for vehicles, to make them more fuel efficient.
• We invested money in “green” fuel research and using fiscal policy to promote the development of green energy.
• We also developed Energuide to promote energy efficiency in homes and places of business. Sadly, this program fell victim to the Minority Conservative Government’s radical cuts.

The Liberal Party is certainly sympathetic to consumers paying high prices for gasoline, and our record shows this.

We support any measure that increases transparency in the international and domestic markets for gasoline.

This motion proposes to strengthen the Competition Act to allow for investigations into gasoline prices, specifically their relationship to the refining margin and corporate profits -- so I am pleased to support it.

On October 6, 2005, the Liberal Party introduced measures to strengthen transparency in the energy market.

As part of Bill C-66, $13 million was set aside to give Canada’s Competition Bureau more powers and to strengthen the Competition Act in response to high energy costs.

This would have clearly given Canada’s Competition Bureau more powers and would have strengthened the Competition Act.

Bill C-66 also committed $15 million to establish an Office of Energy Price Information to monitor energy price fluctuations and provide clear, current information to Canadians.

However, Bill C-66 was one of the first casualties of the minority Conservative government when they took power.

The Conservative Government has flip-flopped on this issue since the first days of the Minority Conservative Government.

The Prime Minister had pledged to Canadians that a Conservative government would eliminate the GST on gas entirely if prices escalated above 85 cents per litre and is now reneging on that commitment.

Another broken promise.

And if that isn’t bad enough, after long advocating tax relief for motorists, The Prime Minister has told Canadians they’ll have to “get used to” high gas prices.

High gas prices aren’t the only thing Canadians will have to “get used to” under this government – the list includes sarcasm, arrogance, hypocrisy, flip flops, contradictions and more broken promises.

Thank you, Mr. Speaker