[Recorded by Electronic Apparatus]
Thursday, April 17, 1997
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[English]
The Chairman (Mr. Andy Mitchell (Parry Sound - Muskoka, Lib.)): I call the meeting to order.
Before beginning our formal part, I'd like to recognize Mr. Reed for a comment.
Mr. Julian Reed (Halton - Peel, Lib.): Thank you, Mr. Chairman. I'm glad you're not ruling it out of order.
I would like to formally acknowledge the presence of the Forum for Young Canadians with us this morning. I have the privilege of knowing some of them personally and I was able to attend their banquet last night.
The Forum for Young Canadians is one of the finest activities conducted around this place. We all appreciate the fact that you come here to learn about political life, and we hope and pray that some of you will choose to run for public office in future years and serve your country.
Welcome on behalf of all of us. I'm sure it is unanimous.
Some hon. members: Hear, hear!
The Chairman: Thank you very much, Mr. Reed.
For all of our audience, what we are doing today is a committee study of a bill that's been referred to the committee, Bill C-249, an act to amend the Nuclear Liability Act. It's a private member's bill that was tabled in the House, has gone through second reading debate and has now been referred to us as the responsible committee.
As we normally do in these situations, we have asked individuals from our lead ministry, the Department of Natural Resources, to come and provide testimony as to their perspective on the bill.
We're pleased to have as the lead witnesses today Bob Morrison, special adviser, andMr. McManus. Both individuals have been here before and we're pleased that you've returned. I'll turn the floor over to you for some opening comments and then we'll move to questions.
Mr. Bob Morrison (Special Adviser, Uranium and Nuclear Energy Division, Energy Resources Branch, Department of Natural Resources): Thank you very much, Mr. Chairman. I'd like to begin by thanking members of the committee for the interest they showed and the support they gave in the passage of the Nuclear Safety and Control Act, which will be a major help in regulating the nuclear industry in Canada in the coming years.
With respect to Bill C-249, we support the objectives of that bill, which we see largely as trying to improve compensation for victims in the unlikely event of a serious nuclear accident. However, Bill C-249 addresses only one aspect of the act, and it does so in isolation from the other aspects.
Our view is that the entire Nuclear Liability Act has to be updated and modernized in a comprehensive way to meet our domestic needs and keep us in line with international practice. We're concerned that if this bill is passed as it is, it would compromise the review process we're engaged in to try to amend the act comprehensively. That review process is fairly advanced, and we hope to be in a position to offer the new government some very specific, comprehensive suggestions about how to amend the bill.
What I thought we would do today is provide you with an overview of the existing Nuclear Liability Act and what we're doing in our current review, and present you our preliminary proposals for the comprehensive amendments I've just referred to.
The purpose of the Nuclear Liability Act is to ensure that funds are available to compensate victims of a possible accident, and to ensure that the access to those funds is simple and fair. Another objective is to provide a stable and predictable liability regime for the nuclear power industry and its suppliers.
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The main provisions of the act are strict liability. The operator is responsible and there is no need to prove negligence to claim for damages.
The liability of the operators of nuclear facilities is also exclusive. They are the only ones who are liable and they are entirely liable. So people who supply equipment to a nuclear operator such as Ontario Hydro cannot be sued by the operator or by third parties. The entire responsibility rests with Ontario Hydro for the safety of its nuclear plants.
There is mandatory operator insurance, up to a specified limit. That is one of the subjects of Bill C-49.
The operator's liability is also limited in both amount and time.
The act has an insurance regime associated with it. The Atomic Energy Control Board - and my colleague John McManus will speak to the board's interests shortly - which is the federal nuclear regulator, designates facilities and establishes mandatory insurance levels. The insurance is provided by the Nuclear Insurance Association of Canada. Our Minister of Natural Resources must approve the insurer. The federal government supplements that insurance through reinsurance. Also in the current act is an implied federal government compensation beyond the liability limit.
The act establishes that a nuclear damage claims commission could be proclaimed by the Governor in Council in the event that the damages from the accident exceed the liability limit or if it is deemed in the public interest to do so. This claims commission would set up an administrative system to deal with large numbers of claims and would replace the judicial system, where you would have to have lawsuits brought under tort law. We believe it would provide, in the case of an accident, an efficient and equitable claims resolution process, rather than forcing everybody to go to court through the tort system.
About reviewing the NLA, it was proclaimed in 1976. At that time the minister indicated a review should take place in five years. In 1982 the AECB began a review of the NLA. In 1990 the AECB submitted a report to the minister. At that time our predecessor department, Energy, Mines and Resources, took over the policy responsibility and continued the review.
In 1991 we established a review committee, but in 1993 we were in court on a lawsuit that had begun in 1987. As we went to court we realized we didn't have the resources to deal with the legislation and the court case at the same time. Also, it was difficult to defend the legislation in court at the same time as we were in the process of revising it. So we abandoned the review for several years while the court case proceeded and resumed it in 1995.
I will review that court case briefly. The plaintiffs were Energy Probe, an environmental group, the City of Toronto, and Rosalie Berthell, who is a crusader against nuclear power on radiation grounds. The defendant was the Attorney General for Canada. Ontario Hydro and New Brunswick Power were interveners.
The basic argument of the plaintiffs was that the act is invalid because it contravenes the Constitution Act, the Charter of Rights, and the Canadian Bill of Rights. The decision of the court was to dismiss the action with costs. The court strongly upheld the constitutionality of the act. The plaintiffs filed a notice of appeal, but in May they decided to abandon their appeal. We're moving forward now with a review of the act.
We had an interdepartmental consultation on preliminary proposals in 1995 through the spring of 1996. We sent these proposals to major stakeholders: the provinces with nuclear facilities, the nuclear operators, and concerned people in the insurance industry. We did this in July 1996 and consulted with them in the fall of last year. We got written comments back from them in December, and we're now putting together a revised set of proposals based on those comments, which we hope to submit to the NRCan minister with recommendations for amendments to the act in June of this year, a few months from now. That comprehensive set of proposals will be ready for the next government to act upon. At that time the government will decide on what public consultation process it wishes to follow before submitting the bill to Parliament.
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I'd like to move on to our preliminary proposals for amending the act. As we see them now, they fall into four categories, and the first is improvements to the compensation provisions. Like Bill C-249, we want to increase the liability limits and the level of compensation. We want to revise the limitation period, and we want to simplify the compensation process. We also want to expand some of the existing provisions to define that compensation process before an accident happens rather than after. Under the current legislation you wouldn't set up the claims commission or its regulations until you actually had an accident, which would be a rather difficult time to set up a new organization and establish regulations. We'd like to try to do that beforehand and to enshrine that possibility in the legislation.
Second, we also think we have to define nuclear damage more explicitly.
A third objective is to reduce the federal financial liabilities through reducing the need for reinsurance by the federal government and also requiring federal facilities, such as those of Atomic Energy of Canada Ltd., to carry insurance so that the burden on the taxpayer will be reduced.
Fourth, there are a number of technical problems with the act. We think we have to clarify the wording and renegotiate some of the insurance agreements.
Those are our comprehensive objectives in proposing amendments to the act. I will go through them very briefly in a little more detail.
The first objective is to improve compensation for the victims, and that's also the objective of Bill C-249. But again, we think we have to do that comprehensively and to deal with the act as a whole and that it would be counter-productive to deal with this one element in isolation. The rationale for trying to improve victim compensation is that the $75 million limit was established in 1976. It represented the insurance capacity, I believe, that was available at that time in what was then an innovative kind of approach to insurance. That limit has devalued with inflation, and Canada is now one of the lowest of the G-7 countries in terms of the liability limits it has. We think we could make available alternative forms of financial security and could combine those forms in different ways to maximize the coverage while limiting the financial burden on the operator. Self-insurance is one that has been suggested by a number of operators.
We think there's a possibility of establishing domestic or international pools of both state and operator funding to increase the amount without increasing the burden on any individual source. We want to talk to the provinces about the possibility of provincial funding and look more specifically at the federal commitments in the legislation.
We also think the time periods for compensation have to be looked at. A number of the latent cancers that could result from the radiation emitted in an accident have a 30-year latency period, so the current 10-year limitation wouldn't capture those. We think that's something that should be looked at.
We also think that the process for victim compensation should be simplified. We think the administrative system is probably the best way to go. We also think that the regulations and the modus operandi of that claims commission, as I mentioned, should be established before an accident happens so we don't have to deal with it in a crisis situation.
In terms of expanding the existing provisions, we want to look at the operations of the claims commission and develop rules and regulations ahead of time. Once the revised act receives royal assent, of course, that would involve rules of procedure and regulations on how the commission would pay out compensation and how it would deal with interim payments that might be required in an emergency situation. We want to ensure that the appropriate provisions are in the act to enable those actions.
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Also, we want to enable the rules and regulations to be kept current. For instance, if with the current act we had regulations that allowed us to revise the liability limits on a periodic basis, we wouldn't have to come back to revise the act every time it was necessary.
We also want to revise the definition of nuclear damage to include environmental damage, preventive measures and pure economic loss, again improving the compensation regime at the same time.
We want to reduce the federal liability. A higher liability limit on the operators would do that. It would mean they would carry more of the burden because their limits would be higher, and the federal government would come in with the lower levels already better looked after.
We want to look at the regime for supplementary insurance and reinsurance to try to ensure that the coverage better reflects the risks associated with each type of facility. Right now it's a $75 million limit for every facility no matter how small, university research reactors and that kind of thing. We think there should be provision for assigning a limit to each facility in terms of the likelihood of the damage it would cause. We would also like to clarify liabilities under the act, reducing the need for federal reinsurance. We want to renegotiate the agreement with the insurers to clarify those. And we want to require federal nuclear installations, as I mentioned, to carry private insurance or other financial security.
Finally, there are some technical problems with the act. If you have tried to read it, you will find some of it rather difficult to read and understand. We'd like to improve the readability and get rid of the ambiguities.
As I mentioned, we want to put in easier updating provisions so we don't have to go to Parliament to update the amount of money. That should be done by a formula of some kind to deal with inflation.
We want to revise the insurance agreements and strengthen the relationship between the federal government and the insurers.
To conclude, in general we support the objectives of Bill C-249, but it addresses only one provision, raising the funding level for compensation. We think it would be more effective to address that issue as part of the overall comprehensive approach currently under way. Basic principles of the act, we think, are still relevant. Our view is that a comprehensive review is needed to bring us up to date.
One major objective of that overall review is to improve the provisions dealing with victims' compensation. So we think the objectives of Bill C-249 can be included in our overall review, that they are not in conflict with it. They include raising the liability limits and the limitation periods.
As I mentioned, the first round of stakeholder consultations is complete and our interdepartmental review committee plans to come forward with recommendations on how to amend the act this summer, ready for a new government.
Thank you, Mr. Chairman.
The Chairman: Thank you very much, Mr. Morrison.
We'll now proceed to questions. First from the Bloc, Mr. Canuel.
[Translation]
Mr. René Canuel (Matapédia - Matane, B.Q.): Given that the Bloc Québécois is in favour of Bill C-249, I would simply like to ask you for some further clarification.
You have undoubtedly received favourable comments about this bill - which are not necessarily of interest to me - as well as unfavourable comments. What have been the most unfavourable comments? I'm not referring to comments made by companies interested in paying as little as possible. Did you receive any unfavourable comments that were not related to monetary matters?
Mr. Morrison: No. Companies and utilities are primarily concerned with money matters. These are the most serious comments we have received. At the provincial level, there were certain concerns about the emergency plans and how they related to our compensation system.
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This concerns us as well, because the amount that we would have to pay would depend on the measures taken by the provincial authorities after a state of emergency has been declared. Consequently, it is in everyone's interest to resolve this issue.
Mr. René Canuel: In your opinion, are there any companies that don't have the financial wherewithal to go from $75 million to $500 million? The company could say that it was capable of doing this, but at one point, we could realize that it doesn't have the necessary cash reserves required for a credible guarantee. Could that happen? Have some companies said that they could not go that high?
Mr. Morrison: No. We believe that all of the companies covered by this act will be able to pay. For the most part, this act covers nuclear facilities of a certain size, such as nuclear plants and uranium mines. We will try to improve the system for these facilities. One thing we would like to do would be to set a limit that is proportional to the potential danger rather than have a $500 million limit applicable to all facilities.
We believe that the big companies, namely the uranium mines and public utilities such as Ontario Hydro, will have the means to pay what is required. As I said earlier, we would like to improve compensation without imposing a proportional burden on the companies. There are other types of insurance that we could combine: pools, self-insurance, etc. It is not as though the entire burden is going to be placed proportionally on the backs of the companies.
Mr. René Canuel: Does this bill not increase the government's civil liability considerably?
Mr. Morrison: The federal government?
Mr. René Canuel: Yes, the federal government.
Mr. Morrison: No, we do not believe so, but perhaps I misunderstood your question.
Mr. René Canuel: If a company were unable to pay, would the government be compelled to make up the shortfall?
Mr. Morrison: No, I believe that companies should pay. A public utility that produces electricity has revenues that are almost guaranteed. It will always have access to this revenue. The insurance costs are not enormous.
Mr. René Canuel: Thank you.
[English]
The Chairman: Mr. Ringma.
[Translation]
Mr. Bob Ringma (Nanaïmo - Cowichan, Ref.): I believe that I understood Mr. Canuel's concern. I would like to ask a question along the same line.
[English]
Like Mr. Canuel, I would say that Reform certainly supports the thrust of this legislation. More than that, Mr. Morrison, your comments on expanding beyond that and the things you propose to put before the government between the month of June...seem very comprehensive. You're acting responsibly because you're a knowledgeable agency and you know all of the things that must be taken into account. So we're going in the right direction here.
But if I understand what was in the back of Mr. Canuel's mind, and certainly in the front of mine, I look at things like Chernobyl in the U.S.S.R. That was a disaster of major proportions. I wonder to what extent in your review of all this, which seems to me pretty comprehensive, you've looked at it as a two-stage thing. One is routine disasters, let's call them, up to an amount of $500 million, which is quite foreseeable. But go beyond that into step two, which would be a really big disaster. As we're all aware, anything having to do with nuclear energy, if it goes wrong, has tremendous ramifications to it.
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So did you in your thinking do a sort of two-step thing on it and say, well, fine, routine disasters are in this area; beyond that, of course, I think it would involve the Government of Canada? It would have to.
Mr. Morrison: Yes, that's always been the assumption for the existing legislation. I think we would want to try to make it a little more explicit in the new legislation as to certain precise levels of government responsibility. If we want to join international pools or international conventions, that would be necessary.
All the countries would have to commit to providing certain levels of funding. The initial funding would be from the operators in some form, probably under insurance. Then there might be a level of auto-insurance. The operators might then pool their resources, as they do in the United States, so each would help out in case of an accident to any one of them. Beyond that there would probably be a requirement for national government funding, and beyond that there might be a pool of national governments. All those would add up to a pretty good total.
We don't think a Chernobyl-type accident is possible in this country. We have legislation which, as I mentioned earlier, this committee looked at, the NSCA, which is intended, among other things, to ensure that good regulation is in place and accidents don't happen on that scale. This legislation is to say if there is, in an unlikely case, a serious accident, this is how we would deal with it.
If we ever had to face a disaster of the magnitude of Chernobyl from nuclear or from whatever other causes, I think that would be such a major political question that Parliament would take action on it. So we don't explicitly foresee accidents in the multi-tens of billions of dollars range, like Chernobyl, because we think in that very unlikely event Parliament itself would have to look at what it wanted to do on the specifics of that accident: where it happened, who was affected, and so on.
I might want to refer to my colleagues from the board and see if that's along their line of thinking too, though.
Mr. J.G. McManus (Special Adviser to the Director General of the Secretariat, Atomic Energy Control Board): Yes, we would support the unlikelihood of that type of accident, because of the many differences in the two systems - not only the difference in design and the difference in the regulatory structure but the difference in the measures to mitigate such an accident after it happened, and in particular the extra containment barriers that exist in the Canadian systems.
Mr. Bob Ringma: I agree with your assessment that it is very unlikely that we in Canada, because of our regulations and responsibility...and given too that the situation in the U.S.S.R. is very different from what we have in Canada. Nevertheless, other than the philosophy expressed here, in your opinion have lessons been learned for us in regard to legislation, lessons looking back at Chernobyl?
Mr. Morrison: About the compensation regime, the Soviet Union and Ukraine did not have one. I think one lesson is that it's good to have one.
Mr. Bob Ringma: Yes. It's good to have a different form of government too.
Mr. Morrison: Yes, indeed, and I think that is one of the lessons, that it does flow from the form of government they did have.
In trying to revise and update the act we have had the Chernobyl accident very much in mind: the environmental damage, the need for international agreements because of the radiation going across borders. So yes, I think we did draw many lessons from that accident. But again, the focus of our legislation is on accidents that are somewhat less catastrophic than that, because we think they are the ones we are more likely going to have to deal with.
Mr. Bob Ringma: I see. Thank you very much.
The Chairman: From the government, Mr. Reed.
Mr. Julian Reed: I have one question about insurance pools where you have international cooperation. Does that not mean you would somehow have to grade the technologies that are in place? It seems to me the technology Canada has in place has far less likelihood of catastrophic occurrence than the technology that's in place in Russia, where they had the Chernobyl accident, or for that matter some of these light-water boilers that are used in the United States, where they had the problem at Three Mile Island, for instance, and so forth.
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What I'm asking is, wouldn't an international pool put Canada at a disadvantage because we do have such a good system?
Mr. Morrison: Yes, that's certainly one of the things we would have to look at. We're not members right now of international pools, except to the extent that the insurance business is international. So when the companies seek insurance, I think the insurance companies among themselves pool their resources internationally. You're quite right that if we joined an international convention or an international pool, we would have to assess pretty carefully who our fellow members are in that.
On the other hand, the other argument is that by lending strength to an international convention or an international pool of resources, we're helping to bring other countries up to our standards. One of the problems in going in to help countries like those of eastern Europe with their safety is that our western suppliers have been rather reluctant to get involved, because they don't have liability regimes in place because they're not part of international conventions. Canada is not part of any international conventions at this time. It's a very interesting debate we'll have down the road as to whether or not we should join any.
Mr. Julian Reed: To just expand on it without belabouring it, I see some incidents, of course, that you can liken to supernatural disasters, if you like. They don't happen very often, but when they do, they happen big time. Let us assume we were locked in with Russia when Chernobyl happened. What would that do to our liability as a country if we were connected in a pool?
Mr. Morrison: It depends very much on how these things are set up, how they work and which one of them we join. My colleague David McCauley has been active in that area and may wish to add some comments. I think if we had been involved with some kind of international convention on Chernobyl, we'd probably be on the hook for several tens of millions of dollars. But we also would probably have been able to buy, along with the other western countries, a more rapid upgrading of safety in those countries. It certainly would have been a great benefit to the people of Ukraine and Belarus, who were the most affected by this, to have had an international regime coming to their assistance and being able to help them. Yes, it would have cost us, but it would have probably improved the overall international regime for safety and for compensation considerably. So there are trade-offs that way.
Mr. Julian Reed: Thank you, Mr. Chairman.
The Chairman: Mr. Bélair.
Mr. Réginald Bélair (Cochrane - Superior, Lib.): Thank you, Mr. Chairman.
Briefly, I would like to go back to the history of your reviews. It took some 15 years to make some recommendations to the minister. I certainly think that in the meantime some other recommendations have been made to the different successive ministers. Do you have a timeframe on the actual review you are making now?
Mr. Morrison: Yes. As I mentioned, we hope to have a complete set of recommendations in the minister's hand by the end of June for a new government to be able to take action on.
Mr. Réginald Bélair: Thank you.
My second question has to do with the definitions on page 7, where it says, define nuclear damage more explicitly. Without being an expert on nuclear damage possibilities, this is going to be extremely difficult to attain. Further, there is the definition of contamination in the short term and the long term. Later in your presentation you mention 30 years. Is this enough?
Mr. Morrison: Those are good questions. That's precisely what we have to try to define a little more carefully in advance so that it doesn't come up in the courts.
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Mr. Réginald Bélair: Yes, because in the case of a major nuclear meltdown, commonly known as the China syndrome, $75 million would certainly not be enough to cover all expenses. I'm talking first about the physical expenses in the sense that some town may be totally eliminated, if not by the accident itself then by the contamination afterwards, and then about humans.
How do you project establishing those definitions, first in terms of death that will certainly occur if there is a meltdown, and second in terms of impairment afterwards? Do you have some guidelines today as to what you would like to see achieved in the near future?
Mr. Morrison: Again, I don't think we're talking about meltdown as our first line of attack. We're talking about off-site damage to third parties that could occur.
Accidents are unlikely, but in the spectrum of accidents the most likely would be some off-site radiation - no physical damage off-site, but some off-site radiation escaping and falling on a local community. The kind of compensation regime we're looking at is one that looks at compensation if people have to be evacuated, if areas have to be permanently evacuated -
Mr. Réginald Bélair: But that's minor, Mr. Morrison. I'm talking about -
Mr. Morrison: In the nuclear industry and in terms of the regulators, any off-site radiation that could affect people is a very major accident. That's what we consider a major breach of the responsibility of the operator. The operator is responsible for not having any off-site radiation.
Mr. Réginald Bélair: That's fine, but there could be a much more serious accident. That is what I'm saying.
Mr. Morrison: As you go up the spectrum toward more and more serious accidents, they become less and less probable. That's what we're trying to trade off.
Mr. Réginald Bélair: If we compare it to some other countries in the world... In other words, you're saying that the quality of the CANDU reactors produced by Canada is far superior, and therefore the possibility of a meltdown or an accident similar to the ones at Chernobyl and Three Mile Island is far less possible.
Mr. Morrison: Yes.
Mr. Réginald Bélair: You're very optimistic.
Mr. Morrison: Well, it's not just the design of the reactor, which we think is a good design. It's also our culture of safety in the nuclear plants, the training they undergo, the actions of our regulator, and the strength of our legislation, which all combine to produce a safety culture that we don't think would result in something as serious as Chernobyl.
Mr. Réginald Bélair: My second question deals with nuclear waste. It is my understanding that this issue is not addressed in this private member's bill.
Mr. Morrison: Only insofar as a nuclear waste facility might qualify - and I don't think it does, does it?
Mr. McManus: The actual disposal of the nuclear waste is another licensing matter, and it's a question in the early stages of development. Damage from the spent fuel that is produced in the reactor is covered by the Nuclear Liability Act, damage when it is in the original facility, if it is moved to interim storage and also when it is put into the final facility. There's extended coverage for that material from this act.
Mr. Réginald Bélair: That is for transportation and storage.
Mr. McManus: Yes.
Mr. Réginald Bélair: As my last question, why does Japan have a $350 million liability whereas Canada to this day has only $75 million?
Mr. Morrison: When we established it back in 1976, $75 million was the international norm. That's precisely what we want to do now - bring it up to the current norm, which would be somewhere in the range of $350 million to $500 million to $600 million.
Mr. Réginald Bélair: How recent is the Japanese figure? When was it established?
Mr. Morrison: It was probably within the last ten years. We would have to look that up, but we can check it.
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There has been a pretty steady movement of increase, partly through inflation but partly through considerations such as Chernobyl - certainly since Chernobyl.
Mr. Réginald Bélair: In this review, do you already have a number in your mind that you would like to propose to the minister?
Mr. Morrison: Yes. I should think it would be in the $500 million range for the liability limit.
Mr. Réginald Bélair: You would think that is enough.
Mr. Morrison: Yes. We're also going to look at topping that up with some of these pool arrangements.
The Chairman: Just before letting our witnesses go, I have a couple of questions. One of them is going to build on Mr. Bélair's question, because I want to make this very specific and get it on the record.
The recommendations you will be in a position to provide to a minister at the end of June will be such that if that minister so chose, he or she could table in the House a piece of legislation.
Mr. Morrison: No, my understanding of the process is that the minister would take it to cabinet and get approval.
The Chairman: No, I understand that part. What I'm asking you is whether the advice to the minister will be in a form such that the minister can undertake what he or she needs to do to get a bill in the House.
Mr. Morrison: Yes, but it wouldn't be drafted in legalese in that point. Once approved, it goes to the drafters. They take some time to put it into -
The Chairman: I understand that, but on the bureaucratic level your job will have been completed, as far as you are concerned, by the end of June. Then it becomes a political process, and then a drafting process.
Mr. Morrison: That's our ambition. Once it gets into the political process a lot of views have to be taken into account. I don't think it will be out of our hands forever at the end of June.
The Chairman: I understand that, but I want to get it clearly on the record that from the bureaucratic perspective of Natural Resources Canada you will be in a position to provide advice to the minister by the end of June that will allow that minister to go forward with the political process to get a bill in the House.
Mr. Morrison: That's our ambition, yes.
The Chairman: My second question is this. Your consultation with stakeholders: has that included consultation with what we would roughly describe as the environmental community?
Mr. Morrison: No, and that's a caveat on the previous question. I think I mentioned in this presentation that once we present our views to ministers based on interdepartmental and stakeholder consultation, it will be up to ministers to decide what form of public consultation they wish to embark on at that point.
The Chairman: Third, you mentioned to Mr. Bélair a dollar figure you were perhaps targeting. To ask the question slightly differently from Mr. Bélair, is that figure driven by the amount of insurability that might be available or is it driven by an analysis of the possible liability?
Mr. Morrison: A bit of the former, in that we think that is available.
The analysis of what liability you have to deal with is... If you look at it on a graph and go from some number such as $100 million or $500 million into the billions, you have to start putting on an estimate of probabilities. Our view is that without going into the form of that curve, whatever probability you have for a $100 million accident, the one for $500 million is less, the one for $1 billion is less, and so on. So it's a question of how far out you go. You get into some fairly small probabilities for an accident in Canada on the scale of Chernobyl. With this legislation we're already under criticism by some in the industry for spending money on something that's not going to happen.
So there's a balance there. We think $500 million is something like the international norm, but we might look at topping that up through pools.
The Chairman: Am I right in assuming the amount of liability insurance that would have to be covered by any facility would be part of the licence, and that would be one of the ways you would control it; you will not license unless somebody carries that liability insurance?
Mr. Morrison: Yes, that is my understanding.
Mr. McManus: That's the structure now, but it may not necessarily be the structure in the new act. That's the way the act works at the moment.
The Chairman: Whatever structure you use, I take it, though, you will not license. You will make sure you have legislative authority that you can refuse a licence if they don't put on the liability insurance.
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Mr. McManus: I don't think it's necessary, Mr. Chairman, to tie the health and safety licence to the nuclear liability. There are other ways to make sure the Nuclear Liability Act operates properly.
The Chairman: I also understood from the testimony that you're suggesting there be an automatic escalating clause to deal with the inflation factor on the $500 million.
Mr. Morrison: That would be our intent, but to try to enshrine that in regulations so that we don't have to come back to Parliament every time.
The Chairman: We'll anxiously await to see how you would word that in the legislation before thinking it's necessarily a good idea.
Mr. Morrison: If I could come back on one point, I don't want to give the impression that we're saying $500 million is the maximum we could ever possibly envision for a nuclear accident. We do think there's a tail of probability that would say there is a very small chance of a more serious accident. That's a continuum.
What we are saying is that we want the act to be able to deal realistically with accidents that we can reasonably foresee. It would provide at least a basis for dealing with the more serious ones, but as I mentioned in my response to Mr. Ringma, I think once you've gone beyond an accident of a few billion dollars, you're into a serious political problem that Parliament would want to address in its specifics.
The Chairman: Thank you very much, Mr. Morrison and Mr. McManus. We appreciate the testimony.
Before letting you go, this is very fortuitous because the committee was discussing a motion yesterday by Mr. Ringma that dealt with the AECB. It related back to the estimates. I would ask if you could remain here, as I understand there is some additional information.
To recap briefly, we had a motion by Mr. Ringma dealing with vote 20 that called for a reduction of $1.3 million. In the discussion Mr. Ringma referred to a couple of the charts in the estimates. One had to do with minor capital and one had to do with grants from other areas.
Have all members received the additional information that was prepared to give some explanation of those? It's being passed out right now.
We had a discussion yesterday. Bob, perhaps you'd like to add a few comments and then we could have some more discussion.
Mr. Bob Ringma: This is a fairly important thrust I'm going to make here, and I beg the indulgence of the AECB witnesses for just a few minutes while I lay the groundwork.
The fact that I made a motion to cut $1.3 million from the AECB budget was in a sense symbolic. But as soon as I made it, a government member said they would want to hear my back-up for this. In other words, the onus was put on me to justify why I would call for a $1.3 million cut.
I would like to suggest to us all that this is backwards. We have to go back a few centuries - and I'm addressing these remarks to the whole parliamentary process. If we go back centuries, the king had the right to say, this is a taxation load, so you guys pick it up and respond. That didn't sit well, and as we know, over the years the Commons in particular developed and was able to question the king's taxation rights. This has drifted down to us and is in the refined form of the estimates that are presented yearly.
Back about 30 years ago this Parliament examined those estimates, the request for money, in detail, perhaps in so much detail that it got a reaction and they said, whoa, we're just bogging down here and we're not able to cut through this. As a result some changes were made. It was taken out of Committee of the Whole and put to committees such as this one to examine the details of those estimates.
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I'm going to quote from something here, but just before I do I'm going to suggest to us all -
The Chairman: Mrs. Cowling, on a point of order.
Mrs. Marlene Cowling (Dauphin - Swan River, Lib.): Mr. Chairman, it was my understanding that Mr. Ringma was to bring to the table some supportive documentation and some analysis to support his motion. I have not received anything in my office and I'm wondering if that has been circulated.
Mr. Bob Ringma: What I am bringing forward, Mr. Chairman, is what I hope is a reasoned argument that is terrifically important to this parliament, to this committee, and to future parliaments. I think it's important. Let's not try to niggle or put me on the defensive again, saying, well, you just haven't produced sufficient...
Please listen to my argument. It will not take long. In fact, if you want it in the form of written argument I'm going to quote a bit. I would like to do that.
The Chairman: Bob, the chair is going to let you make your point and then we can have a discussion around it. I just ask you to be relatively concise, if you wouldn't mind. But make your point.
Mr. Bob Ringma: The point is that the onus should not be on me to prove why I believe$1.3 million should be cut. The onus should be the other way around. In the way we handle this sort of thing in Parliament the burden should be elsewhere, to say, this is why I need the $40 million or whatever it is, or even the $1.3 million, in detail. Specifically, this country is now $600 billion in the hole because the system has just gone from Committee of the Whole to committees such as this and nothing is happening to it. We are not examining things, which is our responsibility.
Parliamentary Government is headed by the Hon. Mitchell Sharp, a name you will recognize, I hope. It has members such as Doug Fisher, Herb Gray, Senator Macdonald, Nelson Riis as an NDP. I'm going to quote very briefly from an article in here - this is January 1994 - by Peter Dobell, who I think members will recognize as well. He says:
Canada inherited from Britain the convention that the executive branch of government may not expend funds until it has secured the approval of the legislature. In the exercise of this traditional responsibility, the Canadian Parliament has been ineffective, its direct impact on expenditure insignificant.
Indeed, since 1969, Parliament's annual review of the estimates
- which we're pretending to do a bit of here -
- has led to a total reduction in percentage terms of only one millionth of one percent in the
expenditures that the government has submitted to Parliament for its approval.
A final quote from Mr. Dobell's article:
With the poor past record of the House of Commons in reviewing estimates, there are no models for new MPs to follow. If committees are to become effective, it will take much time and hard work by Members, a cooperative relationship between government and opposition Members within committees, well-organized work plans, and good staff support. Some lessons -
Mr. Benoît Serré (Timiskaming - French River, Lib.): I have a point of order,Mr. Chairman. We're not here to get a history lesson. I can go to university for that. We've all had our history. We're not here to discuss political philosophy. We're here to discuss the estimates. If there's a proposition, let's have a vote. I'm not going to sit here another half an hour and listen to -
The Chairman: The chair is not going to go on for half an hour, and I don't think Bob is going to go on for half an hour.
Mr. Bob Ringma: No, I certainly am not. In fact, that's the end of the quotations. I can now get down to the real specifics, following which we can vote. I am happy to do so.
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The real specifics are here. My finger's not directed at you, gentlemen, or at your organization; it's symbolic of what's going on. The 1995-96 main estimates for AECB for minor capital were $661,000. In actual fact, that $661,000 became $1,394,000. When we look at the 1996-97 estimates, once again the figure $661,000 appears. When we look at 1997-98, $661,000 reappears. So the routine figure is thrown forward there. It gets no examination that I can see, and therefore I'll say again, it's symbolic for me to attack the figure put forward and suggest, as I'm doing to this committee, that we reduce that. Obviously, implicit in this is that we as a committee, we as a House, would have to do an awful lot more homework to be on top of figures like this. I've done a certain amount of homework. I wonder if the others have.
So I'll throw to you again that because of the past record, $661,000 is a symbolic figure, which I'm putting forward to cut, plus the other one in there, $605,000 in transfer payments, which I'm not sure is to their worth.
That's it. Thank you, Mr. Chairman.
The Chairman: Are there any comments? Mr. Reed.
Mr. Julian Reed: Mr. Chairman, I'm not unsympathetic to the fact that the way we do estimates and the way we give approvals and make decisions can't be improved upon. They certainly can. I would say to Mr. Ringma that the one thing he has is complete access to all the public accounts records as they go back, and he can, if motivated, review the public accounts records of a particular ministry and bring them to the table and compare them to estimates that are being brought forward.
I think what Mr. Ringma would like to do is review estimates and approve estimates before they go to the House and so on, not unlike the American system, I suppose.
What I'm saying is that to accomplish what you want to accomplish, Bob, is for another debate at another time, because it's fundamental to the whole system we use here. So to get back to the specifics of this motion, I can't support it in the context in which you raise it. But in future, if you want to bring in a proposition that's going to change the way we do estimates and improve it, I would have no quarrel with that.
Mr. Bob Ringma: I'd like to make just a very quick response to that. I thank you for that input, Julian.
The Chairman: Bob, Mr. Canuel asked to speak first.
Mr. Bob Ringma: I'm sorry. I saw my light on here, and I thought...
[Translation]
Mr. René Canuel: I would like to thank my colleague. I completely agree with him that this is a substantive debate. This is very important and I would like the Standing Committee on Natural Resources to have more of a say. When granting supply to some entity, it might perhaps be understood that we have some proposals to make.
For some time, we have been talking about rural communities, forestry, mines, etc. Personally, I don't know how I would like to contribute to this and say exactly what we could do with all of this. However, while I respect this motion, I would like to discuss this further at the start of the next session or in the fall, if Parliament continues to sit. I would like to have a substantive debate on this issue.
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I'm going to abstain from voting on this motion because I don't have enough data. I'm not making a motion, however, I would like to propose that we hold a substantive debate on the question.
[English]
Mr. Réginald Bélair: That's a new motion.
The Chairman: He's not making a motion, he's making a suggestion.
Mr. Réginald Bélair: In French ``propose'' is much more than ``suggest''.
[Translation]
Mr. René Canuel: At any rate, I was not making a motion.
Mr. Réginald Bélair: You are not presenting a motion?
Mr. René Canuel: No, because I wish to make one in the fall.
Mr. Réginald Bélair: You are making a suggestion.
Mr. René Canuel: That's right. I will present a motion in the fall.
[English]
The Chairman: Mr. Ringma.
Mr. Bob Ringma: My reaction to both Mr. Canuel's and Mr. Bélair's intercession here is a very positive one. You see what I'm trying to do. It's not necessarily this specific thing, but we have to get things moving in the right direction. I thank you both for that.
We can vote on this. It won't hurt my feelings. Let's take a vote on it and dispose of it. Then we can maybe get our poor members from the AECB off the hook.
Mrs. Marlene Cowling: I would just like to make the point that if in the future motions come before this committee we should have supportive information and documentation that in fact really do support the motion, and they should at least be prepared ahead of time and distributed to the people around the table so in fact we know what we're talking about.
I understand you would like to make some changes, Mr. Ringma. However, it is not fair to the committee members to have a motion brought to the table without any kind of supportive information.
With that, Mr. Chairman, I certainly cannot support the motion, and I would hope we could move ahead fairly quickly.
The Chairman: Which we shall. Mr. Bélair.
Mr. Réginald Bélair: Mr. Ringma is proposing two very different things here this morning. This is the explanation that has been supplied to us. In many ways it's a happy coincidence that the witnesses we have this morning have everything to do with what we have here. We discussed this in their presentation and in our questions. Everything is there.
The second point is that if it is Mr. Ringma's intention to have a fundamental debate, asMr. Canuel said a while ago, on this very subject, then the proper place to do it would be in the House affairs committee. That's where it should be done, not in this committee.
What I am saying is that the motion we have before us is on this substance here and not on the process.
The Chairman: I agree.
To close the debate, as I mentioned yesterday, the liaison committee has recognized what has been brought up here. As the chair, I will undertake to report our feelings, which seem to be general, about the whole view of the estimates at the next liaison committee meeting. I will bring that forward. Then that will be something we will look at in the fall session. Everybody agrees we should have as much information as possible when we undertake these things.
Motion negatived
The Chairman: This meeting stands adjourned.