SoVote

Decentralized Democracy

House Hansard - 154

44th Parl. 1st Sess.
February 6, 2023 11:00AM
  • Feb/6/23 5:28:00 p.m.
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Mr. Speaker, I thank the hon. member for standing up to exemplify what is called the “ratchet effect”, wherein Liberal ideology takes Conservative cuts and amplifies them and always holds them in place. This is the beautiful symbiotic relationship of having Coke and Pepsi in this House, where they will always rail against Conservatives for making cuts to the public sector, for austerity and for everything else. However, when it comes time for them to govern, they hold firm on the neo-liberal ideologies of austerity and cuts to public sector services. I thank him for exemplifying that and let him rise on another false point of order.
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  • Feb/6/23 5:28:47 p.m.
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Mr. Speaker, I thank the member for Hamilton Centre for that brief lecture. It would have been preferable if he had just answered my question. I am sure that on a number of occasions he has voted in favour, including on Hamilton budgets that would have included spending money on employing outside firms, despite the fact that he will grandstand in the House and suggest that no such thing should ever happen. In any event, I will move on. I would just like to take a moment before I get into my speech to recognize somebody from my community, Marie Louise Benson, who just turned 100 years old yesterday. Marie Louise was actually born in the Netherlands and was 17 years old when the Germans invaded Holland. She later moved to Canada after she married the former member of Parliament for Kingston and the Islands, Edgar Benson, who also served in the government of Pierre Elliott Trudeau as the finance minister for four years. I congratulate Mrs. Benson on 100 years. Yesterday she said, “I'm 100 on the dot, and starting a new year tomorrow”. If we all could have such a great outlook on life, I think this would be such a tremendous place to live in. It is an honour for me to stand in this place today and speak to the fifth report of the Standing Committee on Government Operations and Estimates, entitled “Federal Government Consulting Contracts Awarded to McKinsey & Company”. At the outset, I would like to thank the committee for undertaking this very important issue. Contracting for goods and services is a regular part of how the government operates to deliver programs and services to Canadians. The use of professional services complements the work of Canada's public professional service. For example, professional services might be needed to acquire special expertise or to meet the unexpected fluctuations in the workload. Time-limited projects, shortages in certain employment groups and shortages in certain geographic locations may also require the use of professional services. Consultants can also provide independent verification of decisions, offer another viewpoint or establish a set of options for consideration. I will share some examples of why professional services are needed. We can take, for instance, the firefighters who were brought to help quell the forest fires in British Columbia. Another example is the services needed to operate and maintain our assets and facilities, like cleaning our buildings or repairing our vehicles. The reality is that sometimes the use of external services is necessary. Fortunately, we have robust systems and mechanisms in place to ensure that contracts are awarded in a manner that is fair, open and transparent. With that in mind, I would like to outline the policies and processes in place for government contracting. As my hon. colleagues will know, the Treasury Board sets the administrative policy for federal procurement, guided by the principles of fairness, openness, transparency, competition and integrity, all while ensuring the best value. The directive of management of procurement sets the expectations and requirements that departments and agencies must follow so that their procurements are managed in a way that supports the delivery of programs and services to Canadians, demonstrates best value and is consistent with the government's and Canada's socio-economic and environmental objectives. This directive was updated in the last two years, and there is now an explicit requirement that every department have an appointed senior official responsible for procurement. This official is responsible for establishing, implementing and maintaining a departmental procurement framework that consists of processes, systems and controls for procurement. The framework supports the management of procurement so that it is fair, open and transparent. There are also clearly defined responsibilities for government departments when conducting procurements, including those for services. First and foremost, government departments and agencies are expected to maintain the integrity of the procurement process and protect government spending from fraud and unethical business practices. This is done through internal processes and controls, such as the standard contract clauses, and by effective mechanisms for disclosure of any wrongdoing. Second, government departments and agencies are responsible for clearly defining the intended outcomes of a procurement, including operational requirements, expected benefits and how those outcomes align with the government's strategic direction and total costs over the life cycle. Third, departments are responsible for ensuring that government gets the best value. In that regard, it should be noted that the lowest price is not always the best value. Best value can be defined in policy as a balance between pricing and outcomes, so it includes concepts like socio-economic and environmental considerations. In addition to these controls, the Treasury Board also sets contracting limits, dollar thresholds that determine which contracts will require Treasury Board authority to allow entry into the contract and which ones are fully delegated to a minister. Under these thresholds, individual departments may enter into contracts by themselves. Public servants at Procurement Canada and Shared Services Canada, as common service providers, can be the contracting authority for other departments and can provide additional due diligence to the department. These departments have higher contracting limits than other departments, so they will typically handle large-scale procurements. Transparency and accountability are core throughout all of these processes. For instance, government opportunities are posted publicly online at CanadaBuys. Perhaps more importantly, departments are accountable to Parliament and to Canadians through the disclosure of contracting activity, which is reported quarterly. This is in addition to the annual departmental results report, which provides detailed accounts of departments' activities to parliamentarians and to Canadians. The fact is that every government has an obligation to be transparent and responsible with taxpayer money, and it is an obligation we take extremely seriously. Unethical business behaviour by suppliers has numerous consequences. It undermines fair competition. It threatens the integrity of markets. It is a barrier to economic growth. It increases the cost and risk of doing business. It undermines public confidence in government institutions. Departments have a responsibility for protecting government spending from fraud, corruption, unethical business practices and collusive behaviour. That is exactly what Public Services and Procurement Canada's integrity regime aims to address. The integrity regime sets out guidelines that help Canada avoid entering into contracts with suppliers that have been convicted of certain offences, like fraud, bribery and bid rigging. Another critical tool is the Conflict of Interest Act. As hon. colleagues know, the act establishes conflict of interest and postemployment roles for public office holders, which include ministers, ministerial staff and Governor in Council appointees, such as deputy heads. It plays an important role in maintaining public confidence in the integrity of public office holders in government decision-making. The Conflict of Interest Act has strict guidelines to minimize the possibility of conflicts between private interests and the duties of public officer holders, including when it comes to external contracts. The act also provides a stringent vetting process, with critical safeguards in place to address potential or actual conflicts of interest. They are standard contract clauses, a requirement for proposals to be reviewed through a conflict of interest lens, and the need for evaluators to recuse themselves in the event of real or possible conflicts. In addition, all contracts can be subject to review by internal audits and the Auditor General of Canada. I would like to also mention the “Open and Accountable Government” document, which sets out core principles regarding the roles and responsibilities of ministers and ministerial exempt staff. For example, exempt staff may ask departmental officials for information, relay instructions from the minister or be informed of decisions in order to address communications and strategic issues. Let me be very clear on this issue. Exempt staff do not have a role in departmental operations. In fact, they are prohibited by law from exercising the delegated authority of a minister. Furthermore, they are prohibited from giving direction to departmental officials on the discharge of their responsibilities or on issues relating to the management of departmental resources or operational matters. As public office holders, exempt staff members are exempt and are expected to act with honesty and uphold the highest ethical standards. That means complying with the ethical guidelines outlined in the “Open and Accountable Government” document, as well as conflict of interest and postemployment obligations under the Conflict of Interest Act and the Lobbying Act. They may also “not knowingly or intentionally encourage or induce other governmental officials, including parliamentarians, Ministers, public servants and other exempt staff members, to act in manner contrary to the law”. Exempt staff are required to “make themselves aware of ethical standards, expectations, and obligations of public servants set out in the Values and Ethics Code for the Public Sector and departmental codes of conduct”. This means that they must not “engage public servants in any activity that is inconsistent with their ethical and legal obligations”. For public servants, the Values and Ethics Code for the Public Sector outlines the values and expected behaviours that guide them in the activities related to their professional duties. The code is wide ranging but, importantly, it provides a platform for employees to report any wrongdoing that they witness. Taken together, these measures play a critical role in ensuring accountability. They are part of a larger system in place to ensure that the government is open and transparent to both parliamentarians and Canadians. In our parliamentary system, the government provides Parliament with detailed financial information throughout the year. The estimates document, the departmental plans, the public accounts and departmental results report play a critical role by presenting parliamentarians and Canadians with details on the government's activities and spending. All of the latest financial information, including planned spending authorities and estimated expenditures, is publicly available on the Government of Canada InfoBase and Open Government. This wide range of financial reports supports Parliament's scrutiny of public funds. That said, there is always room for improvement, which is why the government committed to taking steps to strengthen our procurement policy by integrating human rights, environment, social and corporate governance, and supply chain transparency principles into government procurements. There is no denying that we have a world-class public service. Whether from a formal work site or a home office, public servants across the country continue to provide Canadians with the services they rely on. Like all of us in this place, they are dedicated to serving Canadians. Providing the services Canadians rely on sometimes requires additional support. That said, we know a strong federal public service is the best way to deliver for Canadians. The government is developing a long-term government-wide public service skills strategy, including increasing the number of public servants with modern, digital skills and improving external recruitment. As we modernize legacy systems and further digitize operations and services, increased investment in IT is essential. Where it makes sense we use internal resources, and where we need to we supplement those with external resources. The Treasury Board of Canada Secretariat is developing government-wide digital talent and digital skills strategies designed to identify and fill critical digital skills gaps while advancing learning and recruitment. The TBS is also developing new guidance for departments on digital talent sourcing to help plan for its digital talent needs, increase the volume of ready-to-hire talent in pools and ensure recruitment is aligned to priority areas. It is intended to reduce dependency on contracting and to fill digital talent gaps. These efforts are expected to result in improved business intelligence, interdepartmental collaboration and access to digital talent. Clearly, Canada has robust policies and tools in place to ensure that contracting is done in a professional and non-partisan manner. As an extra level of assurance, the Prime Minister has asked the Minister of Public Services and Procurement and the President of the Treasury Board to undertake a review of all procurements by government departments with McKinsey & Company. The intent of the review will be to verify if these procurements were conducted in accordance with Treasury Board policies and directives. The government takes its responsibility as the steward of public funds very seriously, and it is committed to ensuring that government spending stands up to the highest levels of scrutiny. To that end, the government welcomes a performance and value-for-money audit, by the Auditor General, of the contracts awarded to McKinsey & Company since January 1, 2011, by any department, agency or Crown corporation. It will, therefore, be my pleasure to vote in support of this motion.
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  • Feb/6/23 5:43:54 p.m.
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Madam Speaker, I thank my colleague for his speech. However, we have questions about McKinsey. We know full well that we are talking about deliverables and contracts, even if my colleague says the contrary. Are they verifiable and quantifiable? This firm has a history of non-verifiable and non-quantifiable deliverables, which enables it to do whatever it wants without any accountability to parliamentarians and journalists. Can my colleague respond to that?
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  • Feb/6/23 5:44:56 p.m.
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Madam Speaker, the member started off by saying that she has questions about the contracts, and what this motion does is specifically ask for those questions to be answered. I do not have the answers to those specific questions. I told the member how I would be voting on this, and I think that if we let due course occur, she will get the answers to those questions. I hope the manner in which they are presented to her satisfies the questions that she has.
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  • Feb/6/23 5:45:02 p.m.
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Madam Speaker, I appreciate that the hon. parliamentary secretary spends quite an amount of time in the House on all debates but, particular to this one, I just have one question for him. It is a simple one. He just spoke at length. Did McKinsey prepare his speech today?
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  • Feb/6/23 5:45:27 p.m.
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Madam Speaker, I am pleased to know that the government will be voting for this motion. I will as well. Does the hon. parliamentary secretary agree that, really, McKinsey is the tip of the iceberg, as the hon. member for Hamilton Centre said moments ago? We had $17 million this year for McKinsey, and a total of about $100 million since 2015. That is a lot of money. In this year alone, it is $22 billion. If we do some quick math, it takes 1,000 million to make a billion. In that context, should we not be looking more broadly at the IBMs, the Deloittes, the defence contractors and all the outsourcing that occurs to foreign corporations in this country?
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  • Feb/6/23 5:46:14 p.m.
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Madam Speaker, despite the fact that the member for Hamilton Centre decided to use the limited time he had for a question for me on such a frivolous question, I actually think he had a really good point earlier in his speech, and that was when he brought up the issue of why it is not expanded. I personally do not have a problem with that. I spent a great amount of my time talking about the openness and transparency of government and what our commitment was to that openness and transparency. This motion could have been brought forward in a way that addressed that on a more holistic scale, because I think the member for Hamilton Centre has a good point: Why just limit this to one? Why not make it more open? I do not think that anybody on this side of the House is afraid to hear the answers that come out of that. Unfortunately, to the member for Saanich—Gulf Islands, we are debating this motion, which is very specific in nature, and I think it is a topic for another day. Perhaps the committee responsible for this will open up the scope to address that concern.
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  • Feb/6/23 5:47:23 p.m.
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Madam Speaker, I have to say to my colleague from Kingston and the Islands that, in all my time in the House of Commons, that is the best speech I have heard him give. Thank you for that. Thank you for supporting the motion we are putting forward here, in getting exposure on these contracts in particular, and thank you for not bending to opening this up so that we are boiling the ocean, as people used to say in consulting work, where we are going to have to look at things that will take us years to look at. This is one specific contract. I will ask the member if he will actually commit to doing this as efficaciously and quickly as possible, to get this done within the next few weeks so that we can totally expose the amount that McKinsey has taken from this government and what results the government has actually gotten from that $100 million-plus of advice over the last handful of years.
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  • Feb/6/23 5:48:14 p.m.
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Madam Speaker, well, the member said “you” on a number of occasions. You have not indicated how you are going to be voting yet, so I would hate to put that in your mouth, to suggest that you are voting in favour of this. To answer his question, in terms of how quickly, I can guarantee him one thing. We will vote on this much sooner than the Conservatives let the average piece of government legislation pass through the House.
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  • Feb/6/23 5:48:43 p.m.
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Madam Speaker, since my colleague is being so transparent, I would like to ask this question. Is it a conflict of interest that McKinsey was receiving millions while Dominic Barton was on the economic advisory council? Could he answer that for me?
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  • Feb/6/23 5:49:05 p.m.
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Madam Speaker, as I indicated in my speech, we have a number of acts that can address that. We have a Conflict of Interest and Ethics Commissioner who oversees order in council appointees, as well as parliamentarians and others. I will leave it up to those professionals, whom we as a collective body have tasked to oversee this to determine whether somebody has acted in a manner that is a conflict of interest. Despite the rhetoric between the member for Hamilton Centre and I a few minutes ago, the problem is that the Conservatives' only objective with this motion is to try to create a new conspiracy for people to believe in. It is something brand new. I listened to Green and NDP members, and they have reasonable ideas. It is unfortunate that the Conservatives cannot follow suit.
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  • Feb/6/23 5:50:21 p.m.
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Madam Speaker, in my remarks, I referenced the cuts under Harper to our public sector. He cut our public sector by 8% up until 2014. In the spirit of some fairness, I will throw the hon. member a bone. Will he respond to his government's plans to restore capacity within our public sector by paying our public sector's market rate, or will he stand by his defence for contracting out so we continue to pay private sector consultants three times that rate?
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  • Feb/6/23 5:51:09 p.m.
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Madam Speaker, there was a follow-up question to that of the member for Hamilton Centre from a Bloc member. I thought I heard her say that we cut the public service and scaled back on it, which is not true. To the member for Hamilton Centre, I agree that when we can, we should be utilizing our public service. That is what we pay them for. When we pay them well and treat them well, they will want to stay and work for us. However, I also respect the fact that there are times when contracting something out makes more sense. It might be something extremely specialized. It might be for something we know will mean a short-term increase in workload. We have to be willing to be flexible in our approach, and we have to use all options available.
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  • Feb/6/23 5:52:07 p.m.
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Madam Speaker, in the vein of reasonableness, I have a question for my colleague. I will agree with my friend from Calgary Centre that that was probably one of our Liberal colleague's best speeches. However, I do not think we have decreased the size of the public service. I think it has gone up by about 30%. Also, third party contracts have gone up by 30% to 35%. With the public service being increased and the number of third party contracts being increased for consulting, does he believe Canadians are getting fair value for their dollar? If they are paying more, are they getting better services?
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  • Feb/6/23 5:52:42 p.m.
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Madam Speaker, two Conservatives have now told me this was the best speech I have ever made. However, about three months ago, I made a speech on the environment and on how Conservatives used to be such great champions of the environment. I thought that was a pretty good speech. Actually, Brian Mulroney sent me a letter afterwards congratulating me on that speech, but if they think that was a good speech, I will take it. To the member's question, we have processes in place to make sure we get the best value for money. I spent a great length of my speech going into the details of how that is done. I trust the processes. I also trust the fact that sometimes the processes might not be properly followed, in which case we have rules and processes in place to correct that behaviour and deal with it appropriately.
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  • Feb/6/23 5:54:02 p.m.
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Madam Speaker, I will be splitting my time with the hon. member for Calgary Midnapore. After eight years, we have had an opportunity to assess the results of the latest grand experiment. We know the experiment we are always told we need to conduct. The experiment is that socialist parties come along and tell voters that life is not fair, that there is too much greed and that the solution to greed is for government to get big and powerful, take the people's money and spread it around in a way that is fair so that everybody gets their rightful due. The question is who actually gets to carve up the spoils and decide who gets what. The answer, of course, is government itself, and government makes its decision based on politics. Of course, politics is based on, unfortunately, influence and those with influence tend to be those with money. As a result, those with money can convert that money into political power, and that power back into yet more money, and that money back into more political power, and the cycle goes and goes and goes. The promise was that the government would get grand and powerful and take from the rich to give to the middle class and those working hard to join it. Do members remember those people? We do not hear about them very much anymore, after eight years. In fact, in practice, the game is played very differently. Let us talk about the very simple question of public finance: from whom to whom. From whom has the money come, and to whom is it going? Let us start with “From whom?” The money is coming from the working-class people of this country, who are under a siege not seen in at least 40 years. Inflation has reached a 40-year high, as the cost of government has bid up the cost of living. Half a trillion dollars of inflationary deficits have increased the cost of the goods we buy and the interest we pay. The real human impact of this highly predictable economic phenomenon is that 67% of Canadians now agree that everything feels broken in Canada. We have nine out of 10 young people who do not own homes say that they never will. We have students, according to media reports, living in homeless shelters while they study. We have 1.5 million people eating out of food banks in a single year, some of them asking food bank presidents for help with suicide, with medical assistance in dying, not because they are sick, but because the poverty they experience after eight years of the Prime Minister is so insufferable that they would rather end their misery altogether. The average mortgage payment has doubled from $1,500 to over $3,200. The average rent payment in our 10 biggest metropolitan centres has doubled as well. By the way, food prices are up 12%, and energy prices have, off and on, experienced inflation at times 100% year over year, and these are the commodities that make up a much larger part of the budgets of the low-income and working-class people. The answer to the question “From whom?” is, of course, Canada's working-class people, the people who get out of bed every day and do the nation's labour. They are the ones who are paying the bills for this experiment. The second part of the question is “To whom?” Who is getting all this benefit? When we look around our communities, we do not see a lot of people putting up their hand and saying, “Boy, I sure have received a windfall.” I do not know how many constituents of the members in this chamber here today are getting $1,500-an-hour contracts from this government: zero. We are talking about a very small group of people who are getting benefits. Who are they? Well, let us start chronologically. Let us go back and start with SNC-Lavalin. This is a perfect example of the experiment of which I speak. They went to a socialist country called Libya. The word “socialist” is actually in the republic's name, so one would think it would want nothing to do with a multinational. Of course, that multinational bought influence and stole over $100 million from the poorest people in Africa. Now the Prime Minister was not going to let a company like that face criminal charges, so he actually fired his attorney general because she refused to have those charges dropped. We saw the Prime Minister protecting a corporation that had stolen from Africa's poorest people, a corporation of amongst the most privileged people on Planet Earth. After that we saw the Prime Minister give multi-million dollar grants to Loblaws to pay for fridges and to highly profitable credit card companies to provide them with corporate subsidies. Recently, his finance minister was confronted about the plan in the budget to fund $2 billion to a company that does not exist. The finance minister, when she heard that allegation, said that was absolutely false, it was not $2 billion, it was $15 billion. We can imagine who is going to benefit from that. Now, we have McKinsey. The Prime Minister gave a glowing speech about his non-friend friend, the non-friend who likes to hug, Dominic Barton. The Prime Minister said he had hired Mr. Barton for $1 a year. Somehow $1 became $50 million, then it became $100 million and then it was $120 million. As the price tag kept rising I actually asked the Prime Minister, close to a dozen times in the House of Commons, what the total dollar value was of all the contracts paid to this company after eight years. He still cannot answer the question. We know that the company is making a lot of money. According to the government departments that hired it, in many cases it did no work of any value. The public servants who could have done the job themselves say the company came in with a bunch of fancy charts and graphs, and the latest MBA-isms, and made off with millions, and no one can actually figure out what they did for the money. That is to whom the money is going. In fact, the government has increased the budget for high-priced consultants by nearly 100% to over $15 billion. For context, we have 15 million families in Canada. That means each family is spending $1,000 in federal taxes for high-priced consultants. That is to whom their money is going. For those sitting at home wondering why their paycheques evaporates in federal taxes and asking where it all goes, that is one answer to the question. Should we be surprised that these are the people who are getting all the money? This is the circle the government travels in. These are the friends that it hangs out with at Davos. None of my members went to Davos. We are not going to Davos. We stayed in our communities while the meeting in Davos was happening recently. We worked for our people, on the ground, the common people. This is the House of Commons, and the common people deserve to have a voice in the House of Commons. We learned the lesson here, that just because the state takes over the economy does not mean it transforms human nature. It does not mean that it abolishes greed. It just redirects greed. As Macaulay might say, if I might paraphrase him: Wherever you throw the carrion, the raven's croak is loud;Wherever you fling the honey, the buzzing flies will crowd; Wherever down river garbage floats, the greedy pike you see;And wheresoever such lord is found, such clients soon will be. Macaulay referred to the flies chasing the honey. Flies do not make honey; they take honey. Bees make honey. That is the kind of difference we have. When the government runs the economy, people get rich by taking. When there is a free market economy, people get better off by making. Bees make honey, through voluntary exchange, through pollination with plants. A voluntary exchange of work for wages, product for payment, investment for interest. Millions of these voluntary exchanges are what make people better off. Instead of a state-controlled crony capitalist economy, we want a free market economy with small government and big citizens that empower individuals to do what they want with their money. That is how we put an end to this kind of crony capitalism, and put people back in charge of their money and their lives.
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  • Feb/6/23 6:04:13 p.m.
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Madam Speaker, to be clear, all capitalism is crony capitalism. The question is, does the leader of the official opposition have the courage to expand the scope of this study to investigate all the pigs at the trough, including Deloitte, Ernst & Young, the Conservative favourite PricewaterhouseCoopers, and KPMG? Why stop at McKinsey when we can go for all of them? Does the leader of the official opposition have the courage to do that?
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  • Feb/6/23 6:04:56 p.m.
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Yes, Madam Speaker. Is that clear? Let us be clear about something. The member believes in capitalism; he just believes that capital should be controlled by bureaucrats and politicians. He believes that if we take the same human being who is a CEO and move him over to make him a top bureaucrat or top politician, suddenly he will become an angel. He believes in allocating capital. He just wants it to be done by force of the state rather than the free enterprise and voluntary exchange of customers, workers and entrepreneurs. He believes in the ultimate control, crony capitalism, which is controlled by the state and directed by people with power. That is what he believes.
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  • Feb/6/23 6:05:49 p.m.
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Madam Speaker, I find that answer very interesting because it begs the question of why the Conservatives did not bring forward a more holistic motion. If the Leader of the Opposition is genuine in saying the opposition motion today is one that opens the books up, as he said, and looks at everything, why would he bring forward a motion that is centred on one specific company? If it were not for anything other than political gain— Some hon. members: Oh, oh!
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